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In another blow to would-be reformers of the Model Rules of Professional Conduct of the American Bar Association, the policymaking House of Delegates has rejected a proposal that would have removed what is effectively a client’s veto power over lawyers who change jobs in the middle of a dispute. The vote ended two days of debate in Chicago in which the house voted on proposed changes rule by rule. The next step will be to ratify the entire package at the ABA’s next meeting in February in Philadelphia. While the house will not cast a final vote on the ethics rules until next year, Tuesday’s unexpectedly swift and decisive votes against key provisions may mean there is little left to fight about. The changes were suggested by the Ethics 2000 Commission, which was assigned to overhaul the rules for the first time since their inception in 1983. But the changes met fierce resistance from a minority group of commission members, led by Philadelphia’s Drinker Biddle & Reath partner Lawrence Fox, who eventually swayed house delegates to reject the two most controversial proposed changes. Before winding up its debate Tuesday afternoon, the board voted on the less emotionally charged conflict-of-interest issue. The change would have greatly affected lawyers representing commercial clients, especially in long-running cases in which the roster of lawyers may change numerous times before the case is concluded. Now, if a lawyer wants to quit one firm and join another that represents the opposing side in a case, he must get permission from all sides, or the firm that hires the lawyer must withdraw from the case. The change would have allowed lawyers to switch firms as long as they had nothing further to do with the case. Opponents, such as Fox, say that there is no real way to wall off the job-switching lawyer and that even innocent hallway chatter could harm the lawyer’s previous client. Geoffrey Hazard, a University of Pennsylvania Law School professor who sits on the Ethics 2000 Commission, said that the proposed change was reasonable but that he didn’t think it was necessarily a mistake that it was rejected. “I guess the question is, can that second firm provide insulation for the lawyer in question so that no conflicts will occur?” Hazard said. “It’s not a life-threatening thing, but [Fox] seems to think that you can’t trust lawyers to do that. So it all comes down to whether you can trust lawyers to do the right thing.” Hazard, though, has a major disagreement with Fox over the two more controversial proposals that didn’t make it past the house Tuesday morning. The house rejected a change to Model Rule 1.6, Paragraph b(2), which would have permitted attorneys to disclose information to law enforcement officials to prevent client crimes or frauds. Facing likely defeat, the majority opinion holders on the commission pulled a second proposed change to Paragraph b(3), which dealt with disclosing privileged information to authorities to rectify the financial losses resulting from a client’s crime or fraud in which a lawyer’s services were used. Delaware Supreme Court Chief Justice E. Norman Veasey, the commission chairman, said he might try to reintroduce the proposal at the midyear meeting in Philadelphia. Hazard said the commission would meet in the interim to see if it could rework the language enough to make it more amenable to its detractors. One idea, he said, could be to remove the word “fraud” and stick with “crime” since most frauds are crimes. “When you look at it, 41 of 50 states already have something like [the b(2) proposal] in case of fraud disclosures,” Hazard said. “The problem is that a lot of lawyers will read that the ABA rejected it and automatically think that it’s wrong — especially lawyers at smaller firms. “I really think this stands as a professional embarrassment and shows that we’re out of step. It doesn’t reflect any core value because truthful statements are protected, not crimes.” Fox, who wrote a minority report and led the opposition by trying to thwart the proposed changes with a series of suggested amendments, said the changes represented a dangerous violation of the rule of secrecy between lawyers and clients. “The ultimate duty of a lawyer is to the client,” Fox said. “You have a problem every time you introduce an exception to privilege because you create a duty to someone other than the client.” As for altering the language of the commission’s proposals, Fox called b(2) “dead on arrival” and said his colleagues shouldn’t hold their breath waiting for him to sign on. “They’re just headed down the wrong path,” he said. Litvin Blumberg Matusow & Young partner Clifford Haines, one of two ABA delegates from the Philadelphia Bar Association along with Fox Rothschild O’Brien & Frankel’s Abraham Reich, voted for b(2) and b(3). “I think that if a lawyer is aware of this kind of behavior, he has a responsibility to disclose information that would prevent innocent people from getting hurt,” Haines said. “And I think that Abe and I went into this with the perspective that something like [the b(2) proposal] is already in place and all of the horror stories that were suggested are not accurate.” However, Haines did side with Fox’s camp when it came to the conflict-of-interest debate concerning lawyers switching firms in the middle of a case. “The more the profession can do to recognize problems of conflict of interest, the better off we are,” Haines said. “What’s a lawyer going to do when he gets to his new firm? Put earplugs on when he walks in to the hallway or turn around when he sees papers on a colleague’s desk? Maybe it could work out, but we work for clients. And I can’t think of a client that would like it if a lawyer left the firm that was representing them and went to join the opposing counsel.” On Monday, the house voted, 243-184, to modify Paragraph b(1) of the model rules, which loosens ethics rules on when lawyers can report risky behavior by clients. The rule change potentially makes it easier for lawyers to stop the release of harmful chemicals or defective products. Until now, lawyers could only turn in a client if the lawyer feared the client was about to kill or harm someone. The rule change approved Monday means that lawyers can report things that may not be a crime, such as a suicide, or that may cause harm a long time down the road, such as the release of a harmful product. The ABA also voted Monday not to change its rules on whether lawyers should put all fees in writing up front. The ABA will continue to recommend written fee agreements. The delegates did back a proposed prohibition on lawyers having sex with their clients. Until now, lawyers and dentists were the only major professions without a strong policy on that issue, said Boston University law Professor Nancy Moore, also a member of the panel that drew up the proposed changes. The ABA’s ethics recommendations are not law but are often adopted by states to write laws governing lawyers. In Pennsylvania, it would be up to the state supreme court to adopt any of the changes to the ABA Model Rules that are not already in place. The Associated Press contributed to this story.

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