Most law firms need new clients to grow their business. As part of a new client intake meeting, a lawyer may ask questions of the potential client to ascertain whether the new representation could create a conflict of interest with any of the lawyer’s current or former clients. But even if the prospective client does not choose that lawyer for the representation, there can still be a risk of a conflict if the lawyer then gets involved in the same or a substantially related matter.

Rule 1.18 of the ABA Model Rules of Professional Conduct provides that where a lawyer has received information from a prospective client “that could be significantly harmful to that person in the matter,” the lawyer is prohibited from representing another client who is adverse to the prospective client in the same or a substantially related matter. This restriction can come as a surprise to some lawyers, who may believe that there is no risk of a conflict as long as no attorney-client relationship is formed.

This column discusses the limitations of Rule 1.18, as well as some tips for lawyers in how to navigate the resolution of any conflicts.

What is a “Consultation”?

The restrictions of Rule 1.18 apply to meetings with a “prospective client.”

Part (a) of the rule confirms that “[a] person who consults with a lawyer about the possibility of forming a client-lawyer relationship with respect to a matter is a prospective client.” But that does not end the inquiry. For example, Comment [2] notes that if a lawyer “specifically requests or invites the submission of information about a potential representation without clear and reasonably understandable warnings and cautionary statements that limit the lawyer’s obligations,” a party’s submission of confidential information in response likely constitutes a “consultation,” indicating that the party is a “prospective client” under Rule 1.18. That is because the lawyer has indicated, either in person or through their advertising, that they are willing to accept potentially confidential information in order to consider a representation.

On the other hand, the comments to the rule note that when a person “communicates information unilaterally” to a lawyer, without a reasonable expectation that the lawyer would be willing to discuss a potential representation, that person is likely not a “prospective client.” To that end, comment [2] also confirms that “a person who communicates with a lawyer for the purpose of disqualifying the lawyer is not a ‘prospective client.’” Although such an inquiry would likely be very fact-specific, this comment could enable a lawyer to take a representation adverse to a prospective client if the only potential conflict arose from the prospective client’s efforts to interfere.

What is Disqualifying Information?

The rules recognize that a prospective client is generally not entitled to the same protections as a current or former client: “A lawyer’s consultations with a prospective client usually are limited in time and depth and leave both the prospective client and the lawyer free (and sometimes required) to proceed no further. Hence, prospective clients should receive some but not all of the protection afforded clients.” Rule 1.18, cmt. [1]. In recognition of that sometimes brief relationship, the interaction only gives rise to a conflict when the lawyer learns information about the client “that could be significantly harmful to that person in the matter.” Rule 1.18.

In Formal Opinion 510, the ABA’s Standing Committee on Ethics and Professional Responsibility built on prior opinions to identify what sort of information may be disqualifying. Disqualifying information could include “views on the potential resolution options, personal accounts of relevant events, sensitive personal information, and strategies.” Whether information is “disqualifying” is a fact-based inquiry that will review what was discussed, how long the lawyer and prospective client met, and whether the lawyer established any boundaries to reduce the risk of receiving disqualifying information.

Comment [4] to Rule 1.18 recognizes that a lawyer may try to limit their discussion with the prospective client, at first, to just the type of information that would allow the lawyer to review for a potential conflict of interest. Such discussions are less likely to lead to disclosure of disqualifying information.

A lawyer is also permitted to expressly limit the scope of their discussions with the prospective client. Indeed, the lawyer may “condition” the consultation on the prospective client’s informed consent “that no information disclosed during the consultation will prohibit the lawyer from representing a different client in the matter.” Cmt. [5].

Even if a lawyer does receive disqualifying information, however, the lawyer can still proceed to  represent  another party adverse to the prospective client in the same or a substantially related matter if all parties provide informed consent.

Imputation of the Conflict

Rule 1.18(c) recognizes that a conflict with a prospective client may be imputed to the lawyer’s entire law firm—unless the prospective client and affected client give informed consent, confirmed in writing.

In recently-issued Formal Opinion 510, the ABA provided additional guidance under Model Rule of Professional Conduct 1.18. Part (d) of the Model Rule provides that even if a lawyer has received disqualifying information, others in the firm may continue with a representation adverse to the prospective client if: (1) the disqualified lawyer took “reasonable measures to avoid exposure to more disqualifying information than was reasonably necessary to determine whether to represent the prospective client”; (2) the disqualified lawyer is screened from the matter; and (3) written notice is provided to the prospective client.

Formal Opinion 510 provides that “once a lawyer has decided there is any basis on which the lawyer would or must decline the representation, stopping inquiry on all subjects would place the lawyer in the best position to avoid potential imputation of a conflict to other lawyers in their firm.”

Additionally, a lawyer can remind a prospective client that the lawyer has not yet agreed to take on a representation and that the information shared should be limited to what the lawyer asks. Notably, such a warning “need not have particular wording” because “the reasonableness of a lawyer’s measures depends on whether they are designed to limit the information received before a lawyer-client relationship is established.”

Considering the risk of disqualification when consulting with a prospective client can help lawyers walk the line between learning sufficient information (that helps the lawyer decide whether to take the matter) and learning “disqualifying information” that could limit the lawyer’s future representations.