Legal Developments and Risk Management Tips Impacting the Professional Liability Community.
Many professionals work on a contingency fee basis. If they achieve a favorable result for their client, they receive a percentage of the profit; no win, no fee. The basic arrangement assumes that the professional will continue to represent the client throughout the duration of the matter. But what are a professional’s rights when a client decides to hire new counsel in the middle of a case?
Many law firms employ law clerks, or hire summer associates. The former are often current law students, while the latter are almost always current law students. There are benefits to both the firm and the student in these situations; the student gains real-world legal experience and an opportunity to work alongside experienced attorneys, while the firm gets capable and often short-term employees. Many firms use these experiences as a way of determining future hiring, as a sort of “trial run” used to assess whether any of the clerks or associate could fit in well at the firm after graduating. It’s a practice that is as widespread as it is common.
Employee wellness programs are all the rage. While the concept is still relatively new, the potential implications of such programs are still being ironed out. Consider for example our recent post about how such plans can comply with other existing federal regulations. As employers struggle to make sure that their programs comply with existing regulations, another aspect of the employer wellness programs cannot be forgotten: taxes. The potential tax implications for both the employer and employee are an important aspect of any wellness program. In a recent Chief Counsel Advice (CCA) the IRS addressed what constitutes taxable income when benefits are provided to employees through a wellness program. Employers and tax-preparers should take note.
Social media is ubiquitous in the workplace. Professionals use social media to write about their achievements, to discuss developments in their field, and to promote their practices. Professionals who use social media as an extension of their practice must be cautious, however, that the discussion of pending matters does not violate their duty of confidentiality to clients or expose confidential information that would prejudice others.
Model Rule of Professional Conduct 1.6(c) provides that “A lawyer shall make reasonable efforts to prevent the inadvertent or unauthorized disclosure” of client information. Generally that isn’t too difficult but things get complicated when it comes to electronic communication. Over 220 billion e-mails are delivered each day. According to reports, e-mail remains the most “pervasive form of communication in the business world.” Given the rampant use of e-mail, eventually there will be mistakes: your e-mail will land in the wrong hands or you will receive an e-mail meant for someone else. In some cases, the disclosure can be harmless, but what happens when the information lands in the hands of counsel for your adversary?
We work hard. We achieve results. We want to develop business as a result of those successes. That’s all understandable since self-promotion is an important part of the development of professionals. By touting personal achievements, professionals are better able to position themselves to compete for new clients. Not surprisingly, many professionals include personal accolades in advertising materials. While the use of awards may be an effective advertising tool, if can also lead to ethical violations when done improperly.
Just like in life, directors must sometimes decide between taking what seems to be an unnecessarily formal route, or simply reaching the inevitable conclusion. Anyone who has spent an entire day putting together IKEA furniture only to finish with a few “leftover” screws can certainly understand that completion is often more important than the path it took to get there. However, the Delaware Chancery Court has made clear that when it comes to director liability, “no harm, no foul” is not the rule of law.
In a recent and ongoing case out of California, a successful attorney’s highly visible public profile may have contributed to a judge ordering the disclosure of the attorney’s personal financial records in relation to a malpractice action initiated against the attorney. A Los Angeles plaintiff’s attorney was recently sued by 28 former clients, who allege that the attorney misappropriated more than $12.5 million of settlement funds. The plaintiffs claim that their former attorney never informed them of the terms of the $17 million settlement agreement, or provided accounting records related to the allocation of the settlement funds.
Have you heard of the “Pharma Bro”; the CEO who, according to reports, notoriously purchased a drug used to treat AIDS patients only to dramatically increase its price? He’s made considerable press recently and now he’s turning on his lawyers. In a recent hearing, lawyers for pharmaceutical hedge fund manager Martin Shkreli requested a delay in scheduling trial as they contemplate asserting “reliance of counsel” as a defense.
Employee wellness plans are a hot item these days. Increasingly, wellness plans are seen as a benefit to both employees and employers alike. As many employers jump on the bandwagon of this growing health trend, they should be aware of the other legal implications of creating and implementing these programs within their company. For example, a popular topic ever since the EEOC issued its proposed regulations last year has been how employee wellness programs can comply with existing regulations such as the ADA and Title II of the Genetic Information Nondiscrimination Act (GINA). Well now it’s time for employers to take note because the EEOC has just finalized its rules in this regard.