If you’ve ever received a letter from opposing counsel threatening to file a motion for sanctions or a disciplinary complaint, or refer a matter for criminal prosecution, you’ve likely raised the question of whether the threat violates that attorney’s ethical obligations. The answer, of course, depends on the circumstances. Primarily, a threat is impermissible if it does not relate to the subject matter of the dispute and is communicated solely to gain leverage in a civil dispute or negotiation.

Indiana no longer has a rule explicitly addressing threats of criminal prosecution, but attorneys who threaten opposing parties or opposing counsel may be subject to discipline under various Indiana Rules of Professional Conduct, including:

• Rule 3.1 (Meritorious Claims and Contentions)
• Rule 3.4 (Fairness to Opposing Party and Counsel)
• Rule 4.1 (Truthfulness in Statements to Others)
• Rule 4.4 (Respect for Rights of Third Persons)
• Rule 8.4(b) (Honesty, Trustworthiness or Fitness) and (d) (Prejudicial Conduct to Administration of Justice)

ABA guidance, Indiana opinions, and decisions from other states assist in analyzing whether a threat is permissible.

Evolution of the Rule

Prior to 1983, the ABA Model Code contained a rule stating, “A lawyer shall not present, participate in presenting, or threaten to present criminal charges solely to obtain an advantage in a civil matter.” This rule was withdrawn in 1983 and was not retained in the ABA Model Rules. Indiana had a similar rule (D.R. 7-105(A)) in its previous Code of Professional Conduct until 1987.

In 1992, the American Bar Association released Formal Opinion 92-363 (“the Formal Opinion”) to provide some guidance on the scope of threats that attorneys are permitted to make. There, the ABA opined that an attorney can threaten to refer the opposing party for criminal prosecution if the attorney has a well-founded belief that 1) both the civil claim and the criminal charges are warranted by the law and the facts; and 2) the subject matter of the criminal conduct is related to the underlying civil suit.

The Formal Opinion was issued to reinforce that introducing an unrelated criminal issue into civil negotiations solely to gain leverage in settling the civil claim furthers no legitimate interest of the justice system and tends to prejudice its administration. The ABA also drew the line for disciplinable conduct at threats that could be considered “extortionate” or “compound a crime.”

Examples of Non-violations

These cases illustrate examples of conduct that did not warrant discipline related to threatening criminal charges.

In Washington, D.C., an attorney threatened criminal charges solely to obtain an advantage in the civil matter. However, the attorney only referenced “a violation of the California Penal Code” and threatened to invoke “all governmental investigative resources.” See In re Pelkey, 962 A.2d 268, 276 (D.C. App. 2008). The threat was found to be sufficiently vague to dissuade recommending a violation occurred.

A Kentucky opinion held that there may be insufficient evidence that a threat of criminal prosecution was made solely to gain advantage in a civil matter where the criminal case was filed by someone else. See Kentucky B. Ass'n v. Hines, 399 S.W.3d 750, 764 (Ky. 2013).

The key elements of non-violations that courts have found include 1) language that is “sufficiently vague”; 2) the threat was limited to the civil litigation; and 3) the criminal action was filed by someone other than the attorney.

Examples of Violations

The following cases illustrate that threats to report opposing counsel or opposing parties for misconduct unrelated to the dispute at issue will fall afoul of the rules:

• Mark Christoff, the then-chief deputy Fountain County prosecutor, was publicly reprimanded for his role with then-Fountain County Prosecutor Richard Holmes in threatening to renew a dormant criminal investigation against a potential candidate for Fountain County, Indiana, prosecutor – unless the potential candidate decided not to run for the office. Christoff also filed a Disciplinary Grievance against the potential candidate. The potential candidate decided not to run. The Indiana Supreme Court found that Christoff “improperly used his prosecutorial discretion to discourage the lawyer for seeking office.” See In re Christoff, 690 N.E.2d 1135 (Ind. 1997).
• An attorney overcharged a client and threatened criminal prosecution to resolve the billing dispute. The attorney indicated in an email to the client that the client was subject to criminal prosecution and a $500 penalty for writing a bad check. The attorney closed the email by writing, “I don’t expect to hear from you about this again, but reserve all my rights in the event that I do.” The attorney was charged with threatening criminal prosecution solely to obtain an advantage in a civil matter. See In re Hoffman, 408 S.C. 186, 189 (2014).
• An attorney sent emails to her former clients’ new lawyer, threatening legal action and criminal charges if the former clients did not dismiss their lawsuit against her. See Sallee v. Tennessee Bd. of Prof. Resp., 469 S.W.3d 18 (Tenn. 2015).
• A Texas attorney tricked his wife into a sham divorce to allegedly protect marital assets. He defrauded her during the divorce proceedings by misrepresenting the marital assets. When she sought to set aside the divorce decree and obtain an appropriate property distribution that considered all of the couple’s marital assets, the attorney communicated a paltry settlement offer and threatened that he would report her alleged criminal conduct (or burglarizing the couple’s vacation home) if she did not accept the settlement offer. See Vickery v. Comm'n for Lawyer Discipline, 5 S.W.3d 241, 261–62 (App. 1999).

Generally, an Indiana lawyer may present, participate in presenting, or threaten to present criminal charges to obtain an advantage in a civil matter if:

• The criminal charges (or ethical charges) are related to the civil matter;
• The lawyer reasonably believes the charges are well-grounded in fact and warranted by law; and
• The lawyer’s conduct does not constitute a crime or rise to the level of extortion.

Accordingly, it is permissible to advise opposing counsel that you will file a motion for discovery sanctions if the matter does not settle, provided that you believe the sanctions are warranted and the settlement demand on the table is reasonable in relation to what your client might obtain at trial. In contrast, it would be impermissible to threaten to file a disciplinary grievance against opposing counsel for conduct in an unrelated matter unless his client pays $5 million in settlement of a contract dispute where only $1,000 is at issue.

Keep these guidelines in mind as you proceed in civil matters to ensure you don't find yourself disciplined for making an impermissible threat.