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Monday, March 16, 2009

While I wasn't blogging, I was lecturing lawyers on ethics

I had many distractions from blogging during my hiatus, but one was preparing a continuing legal education paper and lecture. I like lecturing on ethics topics. That's not because I consider myself an expert on legal ethics. I'm not — and indeed, I begin every such lecture with full disclosure that I'm nothing more than one of the audience members' peers who's tried to practice in an ethical fashion for almost 30 years now.

But it's appropriate, I think, for the rank-and-file members of a profession that is almost entirely self-regulated and self-policed to interact at least some of the time with one of their own, rather than an "expert" (perhaps from academia), on ethical topics. It's useful to bounce around some ideas, do some of the "issue spotting" exercises that we all remember so well from law school, and see whether (to use some very tired but appropriate clichés) we're speaking the same language, working from the same page, and playing in the same ballpark.

In particular, I'm genuinely interested in the way that the traditional Canons of Ethics and their modern-day equivalents find application in the day-to-day practice of law, particularly in civil litigation matters of the sort I handle. And — although I know that there will be dissenters from the statement I'm about to make — after such CLE teaching expeditions, I'm generally reassured and comforted about the degree to which my fellow professionals seem to share with me a common understanding of our basic ethical responsibilities.


So last December, I called up the good folks at one of Houston's several local law schools, South Texas College of Law, to volunteer my services. South Texas runs a monthly luncheon series called "Just Ethics" on the second Friday of every month, each of which delivers a nicely catered lunch plus 1.0 hours of CLE credit for ethics education (toward the satisfaction of any Texas Bar active member's required 3.0 ethics hours each year). I volunteered to be the speaker for February (with my speech to be replayed again on video at the March session).

For my specific topic, I chose Insurance-Generated Ethical Concerns in Business Litigation. The main reason I picked that topic this year was that the Texas Supreme Court recently decided a very significant case on that subject, Unauthorized Practice of Law Committee v. American Home Insurance Co., 261 S.W.3d 24 (Tex. 2008), which had been working its way up through the system since back in the days when Bill Clinton still had a law license and lived in the White House, Barack Obama was a state senator and part-time con-law lecturer, and George W. Bush lived in the Texas Governor's Mansion.

As it happened, not long after I'd volunteered to speak for the February "Just Ethics" luncheon presentation, South Texas asked me to fill in on short notice for a genuine expert on legal ethics — William J. Chriss of the Texas Center for Legal Ethics and Professionalism in Austin — who'd been scheduled to present a paper and speak during their three-day Texas Insurance Law Symposium in January. Chriss left big shoes to fill, and I don't think I did a very good job of it. I think even the title of his proposed presentation, in fact, may be the best one I've ever seen for a CLE ethics talk: "Ethical Challenges of the Brave New World of Litigation: How to Cope with the Death of Perry Mason." Whatever good I may have done, I'm quite sure I didn't equip any of the lawyers in the audience to cope with the death of Perry Mason. I even failed in my effort to use as my "time's-up alarm" the Perry Mason theme music that I have as a favorite ring-tone on my cellphone. But in any event, I ended up preparing and giving essentially the same speech twice (and then once more by video), albeit to three different audiences. And we all survived (and got our CLE credit).

Broadly speaking, the UPLC v. American Home Assurance case represented the State Bar of Texas' attack on the growing national practice by major liability insurance companies of using either "captive law firms" (all of whose business comes from one such company) or the insurers' own staff-attorney direct employees to defend their insureds on claims and lawsuits filed by third parties. The UPLC took the position that so doing constituted the illegal practice of law by those corporate insurers themselves, and that it also required unethical conduct (mostly but not exclusively of the "aiding and abetting" variety) on the part of the individual lawyers so employed.

The insurance companies won this protracted battle, for now anyway. But the case came up in a pinched, odd procedural context — no lawyers were parties by the time it went up on appeal, so no one's license was at stake, and the factual record from the cross-motions for summary judgment in the trial court was laughably thin from both sides. There are good reasons to question whether their win was as broad as originally interpreted, and indeed in many respects, Justice Hecht's majority opinion forms a road-map for private-party plaintiffs who may wish to sue their insurers and/or their insurers' staff-lawyer employees for ethics-related malpractice whenever there's been a judgment above policy limits. If you're genuinely interested, you can read the paper I prepared in connection with the speech, the bulk of which is devoted to that case.


The paper doesn't contain, however, a long-winded first-person war story with which I started each speech — a story that might be entitled, "How, as a Young Whippersnapper, Dyer Got His Law Firm Fired from Sixty Cases in One Day by Its Best Client's Insurance Company Because Dyer Was Being Too Damned Ethical." It's basically a whistle-blower story from a multi-party multi-million dollar wrongful death lawsuit, a story that (as my suggested title hints) is still somewhat painful to me over 20 years later.

But even though the insurance companies involved are now long out of business and their culpable personnel long since retired, and even though the client has been restructured under a different name, and even though I'm probably the only one around who still remembers it in much detail — and even though I think it is indeed instructive, and I've told it to dozens of young lawyers as a cautionary tale, and I still think in hindsight that I didn't do a damned thing wrong, and I would do it all exactly the same way if I had it all to do over again — it's a story that I'm still not comfortable blogging about. Sorry for the long tease here. Maybe in 20 more years. (Of course, by then, it'll be too late for Julia Roberts, or even Matt Damon, to play me in the movie version.)

The moral of the story, though, I can tell, and it is this:

Don't forget, young corporate defense-lawyer Jedi, that your actual client is the named defendant — and not the insurance company who pays your firm's bills but whose interests may not always coincide with those of your actual client! This was a time when there was a personal and professional cost to me from "the zealous pursuit of my client's interests within the bounds of the law." But that's part of the job, and if you can't deal with that prospect, you ought to find a different profession.

Posted by Beldar at 07:45 PM in Law (2009), Trial Lawyer War Stories | Permalink


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(1) Legal Aid made the following comment | Mar 16, 2009 11:29:22 PM | Permalink

More than making money, Ethics should be considered the main area of concern especially in this hard times when people tend to be unethical.

(2) Gregory Koster made the following comment | Mar 18, 2009 9:25:53 PM | Permalink

Dear Legal Aid: Unethical behavior flourishes in hard times? Rubbish! There was a cornucopia of unethical behavior during the late boom, say from 2002-07, which is only now coming to light. The ochlocracy that rules us now bawls for the rack, the rubber hose, and the bayonet. Result: everyone is afraid of the cops and is, in general, behaving themselves, to the point of being afraid to take decisions that are needed to get the economy going again. Unethical behavior flourishes in boom times, when everyone is making millions and those who have doubts are jeered at as suckers. See e.g. Geithner, Timothy, Daschle, Tom, and rest of the rogues The One has sent up. See also the denizens of Washington D.C., which is far from a recession, and hence in a business-as-usual mode. Ethics and integrity are not often productive assets. More likely than not, all you will get from them is mockery and trouble as our genial host discovered all those years ago. Not however, completely: he is behaving unethically by teasing us and semi-promising that if we read his blog for the next 20 years, we might find out what he did. Reading 20 years of Beldar posts. What a deal!

Mr. Dyer it is a pleasure to have you back. I myself spread rumors that you were too weak with laughter at the antics of The One to type. I know I have been snickering more or less continuously since His ascent. This is self-defense; stop laughing and it starts hurting. As I said in the runup to the election, The One promises to be the gaudiest Prez since US Grant. The tuition bills will be appalling, but there's precious little the adults can do until 2010, and maybe past then.

Meanwhile, keep laughing, and keep your snickersee sharp.

Sincerely yours,
Gregory Koster

(3) SPQR made the following comment | Mar 18, 2009 10:54:53 PM | Permalink

Ah, I'm reminded of my days during insurance defense work ...

(4) LLB made the following comment | Mar 19, 2009 11:29:59 PM | Permalink

Hello Mr. Koster: Unethical behaviors are rampant even back in the times that's why I said unethical behaviors are even rampant especially now in the hard times when everyone's goal is to make a living and feed their families. I am sorry if i had not relayed what I really wanted clearly. Thank though!

(5) HasItBeen4YearsYet? made the following comment | Mar 22, 2009 3:33:57 PM | Permalink

Lecturing Lawyers On Ethics?

Wow, you must be a masochist. But, seriously, have you ever seen this?

It's quite interesting how much we can learn when, instead of using our feelings Luke, we actually probe them to see if they hold true.

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