Ethics in Brief


Representing Multiple Classes?  You May Be Violating Your Duty of Loyalty.

You represent a putative class action of former employees against a corporate employer in federal court.  During discovery you learn of facts supporting an entirely separate class action against the corporation, which you want to bring as a separate action. You’ve found an adequate class representative for the new class action.  But, can you represent both classes?

The Northern District of California recently considered just this question during a motion to dismiss, in Sandoval v. Ali.  While some authorities suggest as a blanket rule that an attorney who represents another class against the same defendant may not serve as class counsel, the Sandoval court found the more nuanced position set forth in Newberg on Class Actions persuasive.  Thus, class counsel may represent two classes, even in related cases, as long as the litigants’ interests do not inherently conflict.  Examples of inherent conflicts include where “a limited fund means that the recovery of one claimant will cut directly into recovery by another, where substantive law permits recovery by only one or the other set of litigants, where one client is litigating an appeal to a class action settlement in which another client claimed recovery, and where counsel’s actions have generated conflicts between class representatives and the class.”

What if during your representation of the employee putative class, a former manager of the corporation asks you to represent her in a separate individual action, not related to the class action. You had identified the manager as a witness in the employee class action.  Can you represent the manager, consistent with your ethical duties?

The Sandoval court addressed this situation as well, and suggested the answer to this question may be no.  The problem—the same problem with representing two classes against the same defendant—is the attorney’s duty of loyalty, and the rule against representing concurrent adverse interests (Rule of Professional Responsibility 3-310).  A current client who is a potential adverse witness in another action puts the attorney on the horns of a dilemma:  either the attorney will “have to cross-examine [the witness] and impeach his credibility or ‘soft-pedal’ [the] examination of the [witness] to the detriment of their representation of the” other client.  Not only does the attorney potentially violate his or her duty of loyalty to one or the other client in that scenario, but “[t]he spectacle of an attorney skewering her own client on the witness stand in the interest of defending another client demeans the integrity of the legal profession and undermines confidence in the attorney-client relationship.”

In both of these situations, the Sandoval court declined to disqualify counsel for the putative class because of the early stage of the proceedings, and because the record was not developed.  But, the court suggested it would seriously entertain a request to disqualify plaintiffs’ counsel at the class certification stage.

-Leah Strickland, Solomon Ward Seidenwurm & Smith LLP

Discussing Sandoval v. Ali, 2014 WL 1311776, Case No. C-13-03230(EDL) (N.D. Cal., Mar. 28, 2014), and Rule of Professional Responsibility 3-310.

**No portion of this summary is intended to constitute legal advice. Be sure to perform independent research and analysis. Any views expressed are those of the author only and not of the SDCBA or its Legal Ethics Committee.**