PROFESSIONAL RESPONSIBILITY: THE TEXAS ... attorney cannot be liable for malpractice allegedly resulting in a criminal conviction absent a showing that the plaintiff has been exonerated

PROFESSIONAL RESPONSIBILITY:THE TEXAS SUPREME COURT’S GREATEST HITS

CHARLES W. SCHWARTZVinson & Elkins L.L.P2300 First City Tower

1001 Fannin StreetHouston, Texas 77002

(713) 758-3852(713) 615-5504 (fax)

[email protected]

State Bar of TexasLITIGATION UPDATE INSTITUTE

January 10-11, 2003Austin

CHAPTER 7

CHARLES W. SCHWARTZ2300 First City Tower

1001 Fannin StreetHouston, Texas 77002-6760

(713) 758-3852(713) 615-5504 (Fax)

[email protected]

EMPLOYMENT

Partner, Vinson & Elkins L.L.P., Business Litigation Section, 1986 to PresentAssociate, Vinson & Elkins, Business Litigation Section, 1980 to 1986Law Clerk, Honorable Homer Thornberry, United States Court of Appeals for the Fifth Circuit, 1977 to 1979

EDUCATION

LL.M., 1980, Harvard University, Cambridge, MassachusettsJ.D., with Honors, 1977, University of Texas, Austin, TexasM.A., 1980, University of Texas, Austin, TexasB.S., with Highest Honors, 1975, University of Texas, Austin, Texas

PROFESSIONAL

• Chairman of Board, State Bar of Texas, 2002 to present• Member, Executive Committee, State Bar of Texas, 2001 to present• Director, State Bar of Texas, 2000 to present• Panel Chair and Chairman, District 4I Grievance Committee, State Bar of Texas; 1993-1999• Texas Disciplinary Rules of Professional Conduct Committee of the State Bar of Texas, 1995-1998• State Judiciary Relations Committee of the State Bar of Texas, 1995-1997

LICENSES

• State Bar of Texas, 1977 to present• Board Certified - Civil Appellate Law, Texas Board of Legal Specialization• Licensed to practice before United States Supreme Court, all United States Circuit Courts of Appeals, and the

Northern, Western, Southern, and Eastern Districts of Texas

ORGANIZATIONS

• Member, American Law Institute• Sustaining Life Fellow, Texas Bar Foundation• Life Fellow, Houston Bar Foundation• Fellow, College of the State Bar• Member, American Bar Association

Litigation and Antitrust Sections• Member, State Bar of Texas

Litigation, Antitrust and Business Litigation, and Appellate Sections• Member, Houston Bar Association

Litigation, Antitrust, and Federal Practice Sections• Member, Bar Association of the Fifth Circuit• Life Member, Texas Law Review Association

10/2002

Professional Responsibility Chapter 7

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TABLE OF CONTENTS

I. DUTY........................................................................................................................................ 1

A. Peeler v. Hughes & Luce, 909 S.W.2d 494 (Tex. 1995)................................................ 1

An attorney cannot be liable for malpractice allegedly resulting in a criminal convictionabsent a showing that the plaintiff has been exonerated from the criminal conviction.

B. Barcello v. Elliot, 923 S.W.2d 575 (Tex. 1996). ............................................................ 1

An attorney retained by a testator or settlor to draft a will or trust owes no professionalduty of care to persons named as beneficiaries under the will or trust.

C. Commission for Lawyer Discipline v. Benton, 980 S.W.2d 425 (Tex. 1998). .............. 2

An attorney is not denied the right to free speech or equal protection by Rule 3.06(d) ofthe Texas Disciplinary Rules of Professional Conduct.

D. Bohatch v. Butler & Binion, et al., 977 S.W.2d 543 (Tex. 1998).................................. 2

Law firms do not have an ethical duty to refrain from terminating employment of alawyer for reporting suspected over-billing by a partner of the firm.

E. Latham v. Castillo, 972 S.W.2d 66 (Tex. 1998)............................................................. 3

An attorney’s affirmative misrepresentations to his clients can constitute anunconscionable action thereby violating the Deceptive Trade Practices-ConsumerProtection Act.

F. Burrow v. Arce, 997 S.W.2d 229 (Tex. 1999)................................................................ 3

An attorney who breaches his fiduciary duty to his client may be required to forfeit allor part of his fee, irrespective of whether the breach caused the client actual damages.

G. Douglas v. Delp, 987 S.W.2d 879 (Tex. 1999)............................................................... 4

An attorney cannot be liable for mental anguish damages in a claim for legalmalpractice.

H. McCamish v. Martin, Brown & Loeffler v. F.E. Appling Interests, 991 S.W.2d 787(Tex. 1999)....................................................................................................................... 5

An attorney may be liable to a non-client for the tort of negligent misrepresentation,because under the tort of negligent misrepresentation, liability is not based on thebreach of a duty a professional owes his or her clients or others in privity, but anindependent duty to the nonclient "based on the professional’s manifest awareness of

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the nonclient’s reliance on the misrepresentation and the professional’s intention thatthe nonclient so rely."

I. Lopez v. Munoz, Hockema & Reed, L.L.P., 22 S.W.3d 857 (Tex. 2000)...................... 6

The dissenting opinion written by Justice Gonzales discusses and confirms a lawyer’sduties of (1) fully and honestly informing his or her client of a fee arrangement and (2)refraining from collecting an unconscionable fee from his or her client.

J. Johnson v. Brewer & Pritchard, P.C., 73 S.W.3d 193 (Tex. 2002). ............................. 6

An associate owes a fiduciary duty to his or her employer not to personally profit orrealize any financial or other gain or advantage from referring a matter to another lawfirm or lawyer, absent the employer’s agreement otherwise.

II. DISQUALIFICATION.................................................................................................................. 7

A. NCNB Texas National Bank v. Coker, 765 S.W.2d 398 (Tex. 1989). .......................... 7

When contemplating whether disqualification of counsel based upon priorrepresentation is proper, the court must determine whether the matters embraced withinthe pending suit are substantially related to the factual matters involved in the previoussuit.

B. Phoenix Founders, Inc. v. Marshall, 887 S.W.2d 831 (Tex. 1994).............................. 8

Disqualification of a secretary or legal assistant, who has previously worked foropposing counsel in the same lawsuit, is not required, providing the supervising lawyerat the new firm complies with the Texas Disciplinary Rules of Professional Conduct soas to ensure that the nonlawyer’s conduct is compatible with the professionalobligations of a lawyer.

C. Texaco, Inc. v. Garcia, 891 S.W.2d 255 (Tex. 1995)..................................................... 9

An attorney is disqualified from suing a former client when the former client can "provethe existence of a prior attorney-client relationship in which the factual matters involvedwere so related to the facts in the pending litigation that it creates a genuine threat thatconfidences revealed in his former counsel will be divulged to his present adversary,"pursuant to Texas Disciplinary Rule of Professional Conduct 1.09.

D. Henderson v. Floyd, 891 S.W.2d 252 (Tex. 1995)......................................................... 9

An attorney may be disqualified from representing a client/plaintiff when an attorneywith whom she is associated formally represented the defendant even if that attorneyhad not personally and substantially participated in the litigation.








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E. Anderson Producing, Inc. v. Koch Oil Co., 929 S.W.2d 416 (Tex. 1996).................. 10

An attorney is not prohibited from testifying as an expert witness even though theattorney engaged in pretrial, out-of-court matters such as preparing and signingpleadings, planning trial strategy, and pursuing settlement negotiations because suchrepresentation is not in an "adjudicatory proceeding" within the meaning of TexasDisciplinary Rule of Professional Conduct 3.08.

F. National Medical Enter., Inc. v. Godbey, 924 S.W.2d 123 (Tex. 1996). .................... 10

An attorney can be disqualified from representing a party in a lawsuit against anonclient when the attorney is obliged to treat information regarding the nonclient asconfidential pursuant to a joint defense agreement.

G. In re American Home Prods., 985 S.W.2d 68 (Tex. 1998). ........................................ 11

An attorney and a law firm may be disqualified for employing a legal assistant to workon a litigation matter when that legal assistant was formerly employed by opposingcounsel to work on that same litigation matter.

H. In re Meador, 968 S.W.2d 346 (Tex. 1998). ................................................................ 12

An attorney who receives an opponents’ privileged materials through no wrongdoing ofhis own may be disqualified.

I. In re Users Sys. Serv., Inc., 22 S.W.3d 331 (Tex. 1999). ............................................ 13

A lawyer may be disqualified from continuing to represent a litigant in a civil case formeeting with an opposing party, at the party’s request, if prior to the meeting the partystated that he was no longer represented by counsel, but his former attorney had notmoved to withdraw from the case.







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PROFESSIONAL RESPONSIBILITY:THE TEXAS SUPREME COURT’S GREATEST HITS

I. DUTY

A. Peeler v. Hughes & Luce, 909 S.W.2d494 (Tex. 1995).

In Peeler v. Hughes & Luce, the TexasSupreme Court addressed whether an attorneymay be liable for malpractice allegedlyresulting in a criminal conviction absent ashowing that the plaintiff had been exoneratedfrom the criminal conviction. Peeler wasconvicted of federal crimes after pleadingguilty. Peeler later learned that prior topleading guilty, the United States Attorneyhad offered her absolute transactionalimmunity. Alleging that her attorney failed toinform her of the USA's offer, Peeler sued herattorney for violations of the Texas DeceptiveTrade Practices-Consumer Protection Act andlegal malpractice. The Court stated that inorder to recover under either cause of action,Peeler was required to prove causation. TheCourt stated that "plaintiffs who have beenconvicted of a criminal offense may negate thesole proximate cause bar to their claim forlegal malpractice in connection with thatconviction only if they have been exoneratedon direct appeal, through post-convictionrelief, or otherwise." Id. at 497-98. The Courtconcluded that since Peeler had not beenexonerated, her illegal acts remained the soleproximate and producing cause of herindictment and conviction as a matter of law.The Court reasoned that public policyprohibited a convict from profiting from theirillegal conduct and that allowing recovery forconvicts impermissibly shifts responsibilityfor the crime away from the convict. TheCourt noted that the opportunity to shift much,if not all, of the punishment assessed againstconvicts for their criminal acts to their formerattorneys drastically diminishes theconsequences of the convicts’ criminalconduct and would seriously undermine thecriminal justice system. Accordingly, the

Court held that "as a matter of law, it is theillegal conduct rather than the negligence of aconvict’s counsel that is the cause in fact ofany injuries flowing from the conviction,unless the conviction has been overturned."Id. at 498.

B. Barcelo v. Elliot , 923 S.W.2d 575 (Tex.1996).

In Barcelo v. Elliot, the Texas SupremeCourt addressed whether an attorney whonegligently drafts a will or trust agreementowes a duty of care to persons intended tobenefit under the will or trust even though theattorney never represented the intendedbeneficiary. Elliot drafted an inter vivos trustagreement and will to provide for specificbequests to Barcelo’s children, siblings, andgrandchildren. However, the trust was notfunded during Barcelo’s lifetime. Barcelo’sgrandchildren sued Elliot for legalmalpractice. The Court noted that at commonlaw an attorney owes a duty of care only to hisor her own client, not to third parties who mayhave been damaged by the attorney’snegligent representation of the client. TheCourt stated that without this "privity barrier,"clients would lose control over theattorney-client relationship and attorneyswould be subject to almost unlimited liability.The Court found that allowing such a cause ofaction in favor of beneficiaries would createproblems with disappointed heirs attemptingto prove that the defendant-attorney failed toimplement the deceased testator’s intentions.The Court concluded that this potential tortliability to third parties would create a conflictduring the estate planning process, dividingthe attorney’s loyalty between his or her clientand the third party beneficiaries. The Courtstated that it was unable to craft a bright-linerule that allows a lawsuit to proceed wherealleged malpractice causes a will or trust tofail in a manner that casts no real doubt on the





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testator’s intentions, while prohibitinglawsuits in other situations. The Court furtherconcluded that the greater good would beserved by preserving a bright line privity rulewhich denies a cause of action to allbeneficiaries whom the attorney did notrepresent. The Court stated that this wouldensure that attorneys may in all caseszealously represent their clients without thethreat of suit from third parties compromisingthat representation. Accordingly, the Courtheld "that an attorney retained by a testator orsettlor to draft a will or trust owes noprofessional duty of care to persons named asbeneficiaries under the will or trust." Id. at579.

C. Commission for Lawyer Discipline v.Benton, 980 S.W.2d 425 (Tex. 1998).

In Commission for Lawyer Discipline v.Benton, the Texas Supreme Court addressedwhether Rule 3.06(d) of the TexasDisciplinary Rules of Professional Conductviolated the right to free speech or equalprotection provided by United States andTexas Constitutions. Rule 3.06(d) provides:"After discharge of the jury from furtherconsideration of a matter with which thelawyer was connected, the lawyer shall notask questions or make comments to a memberof that jury that are calculated merely toharass or embarrass the juror or to influencehis actions in future jury service." TEX. DISC.R. PROF. CONDUCT 3.06(d). Benton wasdisciplined after sending a letter to adischarged jury which he admitted violatedRule 3.06(d). Applying the standard set forthin Gentile v. State Bar of Nevada, 501 U.S.1030, 1060 (1991), the Court concluded thatthe application of Rule 3.06(d) to Benton’sletter did not violate the First Amendmentbecause Benton’s letter created a "substantiallikelihood of material prejudice to theadministration of justice." The Court foundthat Benton’s letter was insulting, abusive, andthreatened damage to the jury system bydiscouraging jury service and affecting thejurors’ service while a trial was still in

progress. The Court concluded that Rule 3.06did not violate the Texas Constitution or theEqual Protection Clause for the same reasons.The Court also concluded that Rule 3.06(d)was not unconstitutionally over broad notingthat the Fifth Circuit had upheld completerestrictions on post-verdict communications.Finally, the Court concluded that although theterm "embarrass" was vague, Rule 3.06(d)was not unconstitutionally vague because theterm "harass" was not vague and theunconstitutional provision was separable fromthe remainder of the Rule.

D. Bohatch v. Butler & Binion, et al., 977S.W.2d 543 (Tex. 1998).

In Bohatch v. Butler & Binion, et al., theTexas Supreme Court addressed whether thefiduciary relationship between and amongpartners creates an exception to the at-willnature of partnerships; that is, whether it givesrise to a duty not to expel a partner whoreports suspected over-billing by anotherpartner. Bohatch, a partner in theWashington, D.C. office of Butler & Binion,reported to the firm’s managing partner thatshe suspected over-billing by another partnerin the firm. Shortly after announcing hersuspicion, the managing partner informedBohatch that a major client was not satisfiedwith her work and wanted her work to besupervised. Bohatch then repeated herconcerns to the firm’s managementcommittee, which advised her to beginlooking for other employment following aninvestigation revealing no basis for hercontentions. The trial court granted partialsummary judgment for the firm on Bohatch’swrongful discharge claim and denied thefirm’s summary judgment motion onBohatch’s breach of fiduciary duty and breachof the good faith and fair dealing claimsoccurring before her termination. The Courtof Appeals concluded that Bohatch could notrecover for breach of fiduciary duty becausethe firm’s only duty to Bohatch was not toexpel her in bad faith.


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The Texas Supreme Court relied on Texascommon law to evaluate the principlesgoverning Bohatch’s claim that the firmbreached fiduciary duties when terminatingher employment. Bohatch urged the Court torecognize that public policy requires a limitedduty to remain partners where one partnerreports suspected over-billing of a client byanother partner. Specifically, she argued that“such an extension of a partner’s fiduciaryduty is necessary because permitting a lawfirm to retaliate against a partner who in goodfaith reports suspected over-billing woulddiscourage compliance with rules ofprofessional conduct and thereby hurt clients.”Id. at 546. While recognizing that suchretaliation “virtually assures” that others willnot take similar appropriate and ethical stepsin the future, the Court rejected Bohatch’sargument finding that “[t]he threat of tortliability for expulsion would tend to forcepartners to remain in [an] untenablecircumstance — suspicious of and angry witheach other — to their own detriment and thatof their clients whose matters are neglected bylawyers distracted with intra-firm frictions.”Id. at 547. However, the Court emphasizedthat while the ethical duty to report may createan irreparable schism between partners, suchconflict “neither excuses failure to report nortransforms expulsion as a means of resolvingthat schism into a tort.” Id.

E. Latham v. Castillo, 972 S.W.2d 66 (Tex.1998).

In Latham v. Castillo, the Texas SupremeCourt addressed whether an attorney’saffirmative misrepresentations to his clientsconstituted an unconscionable action therebyviolating the Deceptive TradePractices-Consumer Protection Act. Pursuantto the DTPA, an unconscionable action is "anact or practice, which, to a person’s detriment. . . takes advantage of the lack of knowledge,ability, experience, or capacity of a person to agrossly unfair degree." The Castillos engagedLatham to file a medical malpractice claimagainst the hospital the Castillos believed was

responsible for the deaths of their twodaughters. Latham affirmatively representedto the Castillos that he was actively pursuingthe claim against the hospital. However,Latham never filed suit and limitations ran.The Court concluded that "Latham tookadvantage of the trust the Castillos placed inhim as an attorney," and that the Castillos"were taken advantage of to a grossly unfairdegree." Id. at 69. Accordingly, the Courtconcluded that Latham’s actions were"unconscionable," and therefore violated theDTPA.

F. Burrow v. Arce, 997 S.W.2d 229 (Tex.1999).

In Burrow v. Arce, the Texas SupremeCourt addressed whether an attorney whobreaches his fiduciary duty to his client maybe required to forfeit all or part of his fee,irrespective of whether the breach caused theclient actual damages. Arce and others werepersonal injury plaintiffs represented byBurrow and other attorneys at his firm. Arceand other plaintiffs alleged that Burrow andhis firm, in violation of the rules ofprofessional conduct, solicited businessthrough a lay intermediary, failed to fullyinvestigate and assess individual claims, failedto communicate offers received and demandsmade, entered into aggregate settlement onbehalf of all plaintiffs without plaintiffs’authority or approval, agreed to limit their lawpractice by not representing others involved inthe same incident, and intimidated andcoerced their clients into accepting thesettlement. Plaintiffs asserted causes of actionagainst Burrow and his firm for breach offiduciary duty, fraud, violations of the DTPA,negligence, and breach of contract. Thefactual disputes were not resolved in the trialcourt, rather, the trial court granted summaryjudgment for the defendant attorneys on thegrounds that the settlement of plaintiffs’claims were fair and reasonable and thereforeplaintiffs had suffered no actual damages.The trial court ordered that absent actualdamages plaintiffs were not entitled to a




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forfeiture of any attorneys’ fees. On appeal,the Court of Appeals observed that Texas haslong recognized fee forfeiture as a remedy forbreach of fiduciary duty involving theprincipal-agent relationship with or withoutactual damages. The Court of Appeals foundno reason to make an exception for breachesof fiduciary duty in the attorney-clientrelationship. Accordingly, the Court ofAppeals held that fee forfeiture is a recognizedremedy when an attorney breaches a fiduciaryduty to his or her client and that one whoclaims a breach of fiduciary relationship needonly prove the existence of a breach to beentitled to fee forfeiture. The Texas SupremeCourt addressed four sub-issues: (a) are actualdamages a prerequisite to fee forfeiture? (b) isfee forfeiture automatic and entire for allmisconduct? (c) if not, is the amount of feeforfeiture a question of fact for a jury or oneof law for the court? and (d) would theplaintiffs’ allegations, if true, entitle them toforfeiture of any or all of the attorneys’ fees?

The Court held that actual damages arenot a prerequisite to fee forfeiture, explaining,"the central purpose of the remedy is toprotect relationships of trust from an agent’sdisloyalty or other misconduct. Appropriateapplication of the remedy cannot therefore bemeasured by a principal’s actual damages. Anagent’s breach of fiduciary duty should bedeterred even when the principal is notdamaged." However, the Court determinedthat fee forfeiture is not automatic and entirefor all misconduct. The Court explained, "torequire an agent to forfeit all compensation forevery breach of fiduciary duty, or even everyserious breach, would deprive the remedy ofits equitable nature and would disserve itspurpose of protecting relationships of trust."The Court concluded that whether an attorneymust forfeit any or all of his fee for a breachof fiduciary duty to his client must bedetermined by applying the rule stated insection 49 of the proposed RESTATEMENT(THIRD) OF THE LAW GOVERNING LAWYERS.Section 49 provides, "In determining whetherand to what extent forfeiture is appropriate,

relevant considerations include the gravity andtiming of the violation, its wilfulness, its effecton the value of the lawyer’s work for theclient, any other threatened or actual harm tothe client, and the adequacy of otherremedies." In addition, the Court addedanother factor that it stated "must be givengreat weight in applying the remedy of feeforfeiture: the public interest in maintainingthe integrity of attorney-client relationships."Reasoning that factors like the adequacy ofother remedies and the public interest inprotecting the integrity of the attorney-clientrelationship present legal policy issues wellbeyond the jury’s province, the Courtconcluded that "[t]he ultimate issue on theamount of any fee forfeiture must be made bythe court." Finally, based on the factualrecord, the Court concluded it could notdetermine whether the plaintiffs’ allegations,if true, entitled them to forfeiture of any or allof the attorneys’ fees and remanded the caseto the district court for a factual determinationon the alleged misconduct.

G. Douglas v. Delp, 987 S.W.2d 879 (Tex.1999).

In Douglas v. Delp, the Texas SupremeCourt addressed whether mental anguishdamages are recoverable in a claim for legalmalpractice. The Delps sued Douglas for hisallegedly negligent advice to sign a settlementagreement, the result of which allegedlybankrupted the Delps' corporation. The Courtheld that "when a plaintiff’s mental anguish isa consequence of economic losses caused byan attorney’s negligence, the plaintiff may notrecover damages for mental anguish." Id. at885. The Court noted that other jurisdictionshave allowed mental anguish damages whenthe client’s direct injury is not exclusivelyeconomic, but is more personal in nature, forexample, the loss of a child or the loss ofliberty. The Court further noted that otherjurisdictions have allowed mental anguishdamages when an attorney acted with aheightened degree of culpability. However,the Court explicitly stated that it expressed



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"no opinion on what standard may beappropriate when additional or other kinds ofloss are claimed or when heightenedculpability is alleged." Id.

The Court also addressed issues involvingthe DTPA and bankruptcy law. First, theCourt concluded that although Texas lawprohibits the assignment of legal malpracticeclaims, when a legal malpractice plaintiff filesbankruptcy, his legal malpractice claimsbecome part of the bankruptcy estate and onlythe bankruptcy trustee has standing to pursuethem. Second, the Court concluded that whenan attorney advises his client to sign asettlement agreement "a general representationthat the agreement would protect the [client’s]interest is too vague" to support DTPAliability. Id. at 886. The Court reasoned that"[w]ithout any evidence about which interests[the attorney] represented would be protected,a jury would have no standard by which tomeasure the accuracy of the representation."Id.

H. McCamish, Martin, Brown & Loeffler v.F.E. Appling Interests, 991 S.W.2d 787(Tex. 1999).

In McCamish, Martin, the Texas SupremeCourt addressed whether a law firm may beliable to a nonclient for the tort of negligentmisrepresentation. An attorney withMcCamish, Martin affirmatively representedto F.E. Appling Interests that the settlementagreement executed between it and VictoriaSavings Association was enforceable againstthe FSLIC. However, the Victoria SavingsAssociation's Board of Directors failed toapprove the settlement agreement beforeconsenting to voluntary supervision. VictoriaSavings was later put into receivership, andthe FSLIC refused to satisfy the settlementagreement. F.E. Appling sued McCamish,Martin alleging that McCamish, Martin wasliable for negligent misrepresentation.

McCamish, Martin argued that Applingdid not have a cause of action against

McCamish, Martin for the tort of negligentmisrepresentation as defined by theRESTATEMENT (SECOND) OF TORTS § 552,because under Texas law, an attorney ownedno duty of care to a third party absent privity.According to McCamish, Martin, privity wasrequired by Texas law because of theimportance of the attorney-client relationshipand the nature and demands of the adversarialsystem.

The Court noted that at common law, therule of privity limits attorney liability to thirdparties. The Court acknowledged the generalrule that persons who are not in privity withthe attorney cannot sue the attorney for legalmalpractice. The Court found that in practicalterms, the privity requirement means that anattorney is not liable for malpractice to anyoneother than his or her client. Nevertheless, theCourt affirmed the conclusion of the Court ofAppeals that a legal malpractice claim is notthe equivalent of a negligent misrepresentationclaim. The Court reasoned that under the tortof negligent misrepresentation, liability is notbased on the breach of a duty a professionalowes his or her clients or others in privity, butan independent duty to the nonclient "basedon the professional’s manifest awareness ofthe nonclient’s reliance on themisrepresentation and the professional’sintention that the nonclient so rely." Id. at792. The Court found nothing in the languageof Section 552 that warranted an exception forattorneys. The Court reasoned that allowing anonclient to bring a negligentmisrepresentation claim against an attorneydid not undermine the general rule thatpersons who are not in privity with an attorneycannot sue the attorney for legal malpracticebecause applying Section 552 to attorneys didnot implicate the policy concerns behind theCourt’s strict adherence to the privity rule inlegal malpractice cases. Specifically, theCourt concluded that applying Section 552 toattorneys did not cause a client to "lose controlover the attorney-client relationship," nor didSection 552 "threaten[] lawyers with almostunlimited liability." Id at 793. Finally, the



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Court stated that the RESTATEMENT (THIRD)OF THE LAW GOVERNING LAWYERS § 73(Tentative Draft No. 8, 1997) validated thatapplication of Section 552 to an attorney whenthe attorney invites a nonclient’s reliance. TheCourt found that although a nonclient is notnormally justified in relying on an attorney’sstatement, pursuant to Section 73, an attorneyowes a nonclient a duty of care if the attorneyinvites the reliance. Id. at 795.

I. Lopez v. Munoz, Hockema & Reed,L.L.P., 22 S.W.3d 857 (Tex. 2000).

In Lopez v. Munoz, Hockema & Reed,L.L.P., the Texas Supreme Court held that aplaintiff’s law firm did not breach itscontingent fee agreement, allowing recoveryof an additional five percent fee in the eventthe case was appealed to a higher court, bycharging the additional fee after the defendantfiled a cash deposit with the trial court shortlybefore settlement documents were signed.The Court found that the firm was entitled toadditional compensation following itsdetermination that the case was “appealed to ahigher court” when the defendant initiated theappellate process by filing a cash deposit inlieu of a cost bond. The Court also disposedof the plaintiff’s breach of fiduciary dutyclaim, as this claim was contingent upon anaffirmative finding of breach of the contingentfee contract. The plaintiff’s remaining claimsof fraud, negligence, and violations of theTexas Deceptive Trade Practices act wereremanded to the trial court.

Writing for the dissent, Justice Gonzalesopined that the contract allowing additionalcompensation was ambiguous because thereare multiple interpretations of the point atwhich a case is “appealed to a higher court.”Id. at 865. In light of such ambiguities, heargued that the fee contract should beconstrued against the lawyer-drafter, therebydisallowing the additional fee award. Relyingupon the Restatement of Contracts, JusticeGonzales concluded that “construing[ambiguous] contracts against the drafter is

justified when the drafter is in a better positionto know of uncertainties of meaning or whenthe drafting party has the stronger bargainingposition.” Id. at 866. In the alternative,Justice Gonzales argued that the case shouldbe remanded to determine an objectivemeaning of the contract term “appealed to ahigher court.” Id.

In dicta, Justice Gonzales addressed twoadditional ethical issues not addressed in themajority opinion. First, he advanced theproposition that attorneys owe a fiduciary dutyto fully and honestly explain the ramificationsof their employment contracts to their clients.Id. at 867. He reached this conclusion basedupon his opinions that (1) a lawyer andclient’s negotiations are often imbalanced infavor of the lawyer because of informationinequalities; and (2) the client customarilyrelies upon the lawyer’s legal advice. Id.Second, Justice Gonzales emphasized alawyer’s fiduciary duty not to collect anunconscionable fee from his or her client. Henoted that “[w]hile a contract may entitle alawyer to a substantial fee for little or nowork, a lawyer may nonetheless be requiredby his or her fiduciary duty to decline the fee.”Id. at 868.

J. Johnson v. Brewer & Pritchard, P.C., 73S.W.3d 193 (Tex. 2002).

In Johnson v. Brewer & Pritchard, P.C.,the Texas Supreme Court addressed whetheran associate of a law firm may refer a matterto another firm or lawyer without breaching afiduciary duty to his or her employer. The lawfirm of Brewer & Pritchard sued its formerassociate, Chang, and another lawyer withwhom that associate formed a partnership,Johnson, following the associate’s referral ofmultiple claims relating to injuries sustainedin a helicopter crash to Johnson. The Courtevaluated the firm’s claims, in part, byanalyzing the duties of agents in a principal-agent relationship. In citing the Restatement(Second) of Agency, the Court elaborated on





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the extent of an agent’s fiduciary duties to itsprincipal:

The agreement to act on behalf of theprincipal causes the agent to be afiduciary, that is, a person having aduty, created by his undertaking toact primarily for the benefit ofanother in matters connected with hisundertaking. Among the agent’sfiduciary duties to the principal is theduty to account for profits arising outof the employment, the duty not toact as, or on account of, an adverseparty without the principal’s consent,the duty not to compete with theprincipal on his own account or foranother in matters relating to thesubject matter of the agency, and theduty to deal fairly with the principalin all transactions between them.

Id. at 200 (citing RESTATEMENT (SECOND) OFAGENCY § 13, cmt. a (1958)). Consistent withthe Restatement, the Court also cited KinzbachTool Co. v. Corbett-Wallace Corp., 160S.W.2d 509, 514 (Tex. 1942), for theproposition that where a fiduciary “takes anygift, gratuity, or benefit in violation of hisduty, or acquires any interest adverse to hisprincipal, without a full disclosure, it is abetrayal of his trust and a breach ofconfidence, and he must account to hisprincipal for all he has received.” Johnson, 73S.W.3d at 200-01.

However, in contrast, the Court noted thatan employer’s right to demand and receiveloyalty must be tempered by society’slegitimate interest in promoting competitionand encouraging lawyers to secure the mostappropriate representation for clients. Id. at201-203. “[A]n at-will employee mayproperly plan to go into competition with hisemployer and may take active steps to do sowhile still employed,” however, there are“certain limitations on the conduct of anemployee who plans to compete with hisemployer.” Id. at 201-202. One such

limitation pertains to an associate’s “fiduciaryduty not to accept or agree to accept profit,gain or any benefit from referring orparticipating in the referral of a client orpotential client to a lawyer or firm other thanthe associate’s employer.” Id. at 203. In theinstant case, the Court found no evidence thatChang profited or gained any advantage fromreferring the case to Johnson, yet remandedthe firm’s breach of fiduciary duty claim forfailure to assert Chang’s lack of profit oradvantage in its pleadings.

II. DISQUALIFICATION

A. N.C.N.B. Texas National Bank v. Coker,765 S.W.2d 398 (Tex. 1989) (orig.proceeding).

In N.C.N.B. Texas National Bank v.Coker, the Texas Supreme Court consideredthe appropriate standard for courts to applywhen reviewing a motion to disqualifycounsel based upon prior representation.N.C.N.B. Texas National Bank (“N.C.N.B.”)filed a petition for writ of mandamus seekingto compel the Honorable Bill Coker to rescindhis order of disqualification of the law firm ofVial, Hamilton, Koch & Knox (“VialHamilton”). N.C.N.B. brought suit in districtcourt based upon credit insurance policies andwrongful collection and retention of fundsgained by Defendants as a result of sellingequipment which was collateral for equipmentleases now in default. Id. at 399. Defendants,Western Fire & Casualty Insurance Company(“Western Fire”) and Walker General Agency,Inc. (“Walker General”) initiated thecontroversy presented in this mandamusproceeding upon the filing of a motion todisqualify counsel for N.C.N.B. for previouslyrepresenting Defendants in an unrelated lawsuit. Western Fire and Walker General arguedthat the prior representation gave VialHamilton access to confidences and secretswhich would be violated by Vial Hamilton’scurrent representation of N.C.N.B (formerlyFirst Republic Bank of Dallas).







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After evaluating the parties’ claims, theCourt held that “when contemplating whendisqualification of counsel is proper, courtsmust determine whether the matters embracedwithin the pending suit are substantiallyrelated to the factual matters involved in theprevious suit.” Id. at 399-400 (emphasis inoriginal). The Court provided the followingguidelines in making this determination:

The moving party must prove theexistence of a prior attorney-clientrelationship in which the factualmatters involved were so related tothe facts in the pending litigation thatit creates a genuine threat thatconfidences revealed to his formercounsel will be divulged to hispresent adversary. Sustaining thisburden requires evidence of specificsimilarities capable of being recitedin the disqualification order. If thisburden can be met, the moving partyis entitled to a conclusivepresumption that confidences andsecrets were imparted to the formerattorney.

Id. at 400. In the instant case, the Courtdetermined that the trial judges’ finding “thatthe two orders were ‘similar enough’ to givean ‘appearance’ that confidences which couldbe disclosed ‘might be relevant’ to therepresentations falls short of the requisites ofthe established substantial relation test. Assuch, the Court directed the trial court tovacate the order of disqualification. Id at 401.

B. Phoenix Founders, Inc. v. Marshall, 887S.W.2d 831 (Tex. 1994) (orig.proceeding).

In Phoenix Founders, Inc. v. Marshall,the Texas Supreme Court considered whethera law firm must be disqualified from ongoinglitigation because it rehired a legal assistantwho had previously worked for opposingcounsel. The law firm of Thompson & Knightwas retained to represent Phoenix Founders,

Inc. to collect a federal-court judgment againstDefendants, Ronald and Jane Beneke. TheDefendants were represented by the law firmof David & Goodman. While the collectionsuit was pending, Denise Hargrove, a legalassistant with Thompson & Knight, left herposition at that firm to commenceemployment with David & Goodman as aparalegal. While at David & Goodman,Hargrove billed six-tenths of an hour on thecollection suit and discussed the casegenerally with the Defendant’s lead counsel.Upon Hargrove’s return to Thompson &Knight only three weeks later, counsel forDefendants sent a letter to Thompson &Knight demanding that the firm withdrawfrom its representation of Phoenix, assertingthat its renewed employment of Hargrovecreated a conflict of interest. When the firmrefused to withdraw from the case, theDefendants filed a motion to disqualify. Thetrial court initially overruled the Defendants’motion, however, later disqualified Thompson& Knight on motion for reconsideration.

Relying upon the standards governingdisqualification whenever counsel undertakesrepresentation of an interest that is adverse tothat of a former client, the Texas SupremeCourt held that disqualification of Thompson& Knight was not required if the firm was ableto establish that it had effectively screenedHargrove from any contact with theunderlying suit. Id. at 833. In reaching thisholding, the Court recognized the conclusivepresumption that confidences and secrets wereimparted during the course of the paralegal’swork at the previous law firm. However, theCourt noted that it should not be conclusivelypresumed that the confidential informationwas shared with members of the paralegal’scurrent law firm. Id. at 834. Thus, “while acourt must ordinarily presume that somesharing will take place, the challenged firmmay rebut this presumption by showing thatsufficient precautions have been taken toguard against any disclosure of confidences.”Id. Factors to consider in determiningwhether the screening of information was




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effectively achieved, courts should consider(1) the substantiality of the relationshipbetween the former and current matters; (2)the time elapsing between the matters; (3) thesize of the firm; (4) the number of individualspresumed to have confidential information; (5)the nature of their involvement in the formermatter; and (6) the timing and features of anymeasures taken to reduce the danger ofdisclosure. Id. at 836. Applying thisreasoning to the present case, the Court deniedthe writ of mandamus without prejudice toallow the trial court to reconsider thedisqualification in light of the aforementionedfactors.

C. Texaco, Inc. v. Garcia, 891 S.W.2d 255(Tex. 1995).

In Texaco, Inc. v. Garcia, the TexasSupreme Court addressed whether the districtcourt abused its discretion by refusing todisqualify plaintiff’s trial counsel. Plaintiff’strial counsel, Ronald Secrest and the firm ofBeck, Redden & Secrest, sued Texaco andothers for environmental contamination.Secrest and the named partners of his firmformerly practiced with Fulbright & Jaworskiwhich was long-time counsel to Texaco,representing Texaco in no fewer than 106litigation matters. While at Fulbright &Jaworski, Secrest participated in defendingTexaco in another environmental litigationmatter. Texaco moved to disqualify Secrestand his firm pursuant to Texas DisciplinaryRule of Professional Conduct 1.09. The Courtexplained that Rule 1.09 required Texaco to"prove the existence of a prior attorney-clientrelationship in which the factual mattersinvolved were so related to the facts in thepending litigation that it creates a genuinethreat that confidences revealed in his formercounsel will be divulged to his presentadversary." Texaco, Inc. v. Garcia, 891S.W.2d at 256. In the environmentalcontamination matter handled by Secrestwhile at Fulbright & Jaworski, the plaintiffsalleged that Texaco and others polluted theplaintiffs’ land with leaching and/or improper

disposal of petroleum by-products, chemicalsand hazardous wastes. In the environmentalcontamination matter at issue, the Plaintiffsallege that Texaco and others polluted theirlands by improperly disposing and handling ofcertain battery cases which contained lead,and petroleum products which leaked fromunderground storage tanks. Trespass,negligence, nuisance, strict liability, andnegligence per se were alleged in both cases.The Court found that the factual and legalmatters involved in the environmentalcontamination matter Secrest handled forTexaco while at Fulbright & Jaworski "wereso related to the facts in the pending litigationthat it creates a genuine threat that confidencesrevealed in his former counsel will bedivulged to his present adversary."Accordingly, the Court disqualified Secrestand his firm pursuant to Rule 1.09 and1.09(b).

D. Henderson v. Floyd, 891 S.W.2d 252(Tex. 1995).

In Henderson v. Floyd, the TexasSupreme Court addressed whether the districtcourt abused its discretion by refusing todisqualify plaintiff’s trial counsel. Henderson(defendant) was represented by Clint Lewis.One month before trial, plaintiff’s counselretained Ken Lewis (no relation to Clint) asnew co-counsel for trial. An associate at KenLewis’ firm, Brett Thomas, was previouslyemployed by Clint Lewis’ firm during thependency of the litigation. While employedby Clint Lewis, Thomas never met Henderson,never served as Henderson’s attorney ofrecord, and never worked on any specificbriefing assignment in the case. However,Thomas saw Henderson’s files and may havehandled them. Additionally, Thomas mayhave seen plaintiff’s settlement video and mayhave proofread briefs. Moreover, Thomas wasunable to deny that he had some involvementin the case. Finally, Thomas attendedsemi-weekly "file review" meetings at whichattorneys at the firm discussed litigationstrategy. Upon discovering that Ken Lewis






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agreed to represent plaintiff, Thomas avoidedall contact with the case, and his firmattempted to shield him from any accidental orintentional exchange of confidentialinformation. Henderson does not claim thatThomas actually divulged confidentialinformation.

Henderson moved the district court todisqualify Ken Lewis pursuant to TexasDisciplinary Rule of Professional Conduct1.09. Rule 1.09 provides in part:

(a) Without prior consent, alawyer who personally hasformerly represented a client ina matter shall not thereafterrepresent another person in amatter adverse to the formerclient: . . .(3) if it is the same orsubstantially related matter. . . .(b) Except to the extentauthorized by Rule 1.10[successive government andprivate employment], whenlawyers are or have becomeassociated with a firm, none ofthem shall knowingly representa client if any one of thempracticing alone would beprohibited from doing so byparagraph (a).

The Court stated that under this rule, ifThomas "personally represented" Hendersonwhile associated with Clint Lewis, then KenLewis could not represent plaintiff. The Courtfound that Thomas may have done actualwork on the case and was exposed toconfidential information. The Courtconcluded that it was not necessary to showthat Thomas "personally and substantiallyparticipated" in the case. The Court held,"[t]he simple fact is that [Henderson’s] formerlawyer is now associated with his opponent’slawyer. Rule 1.09 does not permit suchrepresentation, and the district court clearlyabused its discretion in reaching a contrary

conclusion." Henderson v. Floyd, 891 S.W.2dat 254.

E. Anderson Producing Inc. v. Koch OilCo., 929 S.W.2d 416 (Tex. 1996).

In Anderson Producing Inc. v. Koch OilCo., the Texas Supreme Court held that TexasDisciplinary Rule of Professional Conduct3.08 did not prohibit an attorney fromtestifying as an expert witness even though theattorney engaged in pretrial, out-of-courtmatters such as preparing and signingpleadings, planning trial strategy, andpursuing settlement negotiations because suchrepresentation was not in an "adjudicatoryproceeding" within the meaning of Rule 3.08.Rule 3.08 provides in applicable part: "Alawyer shall not accept or continueemployment in a contemplated or pendingadjudicatory proceeding if the lawyer knowsor believes that the lawyer is or may be awitness necessary to establish an essential facton behalf of the lawyer’s client." TEX. DISC.R. PROF. CONDUCT 3.08. The Court reasonedthat Rule 3.08 is grounded in the belief thatthe finder of fact may become confused whenone person acts as both advocate and witnessbecause it may not be clear to the jury whethera statement by an advocate-witness should betaken as proof or as an analysis of the proof.The Court concluded that this rationale did notapply when the testifying lawyer is merelyperforming out-of-court functions, such asdrafting pleadings or assisting with pretrialstrategy. The Court further concluded thatthis interpretation of Rule 3.08 was enforcedby a subsequent amendment providing thatRule 3.08 only applies to "employment as anadvocate before a tribunal in a contemplatedor pending adjudicatory proceeding."

F. National Medical Enter., Inc. v. Godbey,924 S.W.2d 123 (Tex. 1996).

In National Medical Enters. v. Godbey,the Texas Supreme Court addressed whetheran attorney can be disqualified fromrepresenting a party in a lawsuit against a






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nonclient. NME retained Tomko to representan ex-employee. Subsequent to Tomko’srepresentation, another attorney at Tomko’slaw firm sought to sue NME on behalf of aclass of plaintiffs in matters substantiallyrelated to the lawsuit in which NME retainedTomko to represent its ex-employee. Duringthe course of the representation on behalf ofthe ex-employee, Tomko received informationfrom NME that he was obliged to treat asconfidential pursuant to a joint defenseagreement. The Court was called upon todecide whether the confidences received byTomko prevented Tomko’ s firm from suing anonclient. The Court concluded that anattorney’s duty to preserve confidences sharedunder a joint defense agreement was no lessbecause the person to whom the confidencesbelong was never a client. The Courtreasoned that the attorney’s promise placeshim in the role of a fiduciary, the same astoward a client. Perceiving no reason why thepresumption that an attorney in a law firm hasaccess to the confidences of the clients andformer clients of other attorneys in the firmshould not apply, the Court held that "anattorney’s knowledge of a non-client’sconfidential information that he has promisedto preserve is imputed to other attorneys in thesame firm." Id. at 132. Accordingly, theCourt concluded that Tomko's firm should bedisqualified because even though theex-employee was not a party to the lawsuit,the small but serious risk to the ex-employeeposed by the lawsuit made it adverse to him.The Court reasoned that "[t]he chances ofbeing struck by lightening are slight, but notslight enough, given the consequences, to riskstanding under a tree in a thunderstorm." Id.at 133.

G. In re American Home Prods., 985S.W.2d 68 (Tex. 1998).

In In re American Home Products, theTexas Supreme Court addressed whether alaw firm must be disqualified for employing alegal assistant to work on a litigation matterwhen that legal assistant was formerly

employed by opposing counsel to work on thatsame litigation matter. The Court held that thetrial court abused its discretion by failing todisqualify the law firm. The Court found thatwhether the legal assistant actually possessedconfidential information as a result of heremployment with the first law firm wasirrelevant. The Court reiterated an earlierholding that a legal assistant who has workedon a case must be subject to a conclusivepresumption that confidences and secrets wereimparted. Stating that the issue is whetherthere is a genuine threat of disclosure, notwhether disclosure materialized, the Courtfound that the presumption that a legalassistant received confidential informationwas not a rebuttable one. However, the Courtnoted a distinction between lawyers andnonlawyers: while the presumption that alawyer shared confidential information with anew employer cannot be overcome, thepresumption that a legal assistant sharedconfidential information with a new employercan be overcome. Citing prior opinions, theCourt restated that uncontroverted testimonyfrom lawyers that a legal assistant did notreveal confidential information wasinsufficient to overcome the presumption thatconfidential information was shared. TheCourt explained that the presumption may berebutted only by establishing that sufficientprecautions have been taken to guard againstdisclosure of confidences. To establishsufficient precautions, the new employer mustshow: (1) that the legal assistant wasinstructed not to work on any matter on whichthe legal assistant worked during the prioremployment, or on matters on which the legalassistant has information relating to the formeremployer’s representation; and (2) that thenew employer took reasonable steps to ensurethat the legal assistant did not work inconnection with matters on which the legalassistant worked during the prior employment,absent client consent. The Court noted thatthis test was recommended in ABA InformalOpinion 1526.




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The Court also addressed whetherco-counsel to a law firm employing a legalassistant formerly employed by opposingcounsel must be disqualified. The Court heldthat the trial court did not abuse its discretionby failing to disqualify co-counsel. The Courtnoted that two analyses were required; first,whether co-counsel received confidentialinformation from the nonlawyer legalassistant, and second, whether co-counselreceived confidential information from thelawyer-employer. With regard to nonlawyers,the Court stated that disqualification isrequired if: (1) there has been an actualdisclosure of confidential information by thenonlawyer; or (2) the nonlawyer andco-counsel work so closely together or thenature of their communications is such thatthere is a substantial likelihood thatconfidential information was shared. TheCourt explained that once a party seekingdisqualification has established that there wascontact or communication between the taintednonlawyer and co-counsel, the burden shifts tothe party resisting disqualification to offerevidence that there was "no reasonableprospect that the opposing party’s confidentialinformation was disclosed and that it was notin fact disclosed." Id. at 78. With regard tolawyers-employers, the Court noted that inthis case there was no indication that taintedcounsel had actual, rather than imputedknowledge of the adversary’s confidentialinformation. However, the Court rejected theargument that it would be unwise or improperto apply the concept of double imputation.The Court concluded that "the proper balanceis to place a burden of producing evidence ofnon-disclosure on the party resistingdisqualification once the requisite showing hasbeen made by a party seekingdisqualification." Id. at 81. The "requisiteshowing" requires the party seekingdisqualification to demonstrate that there were"substantive conversations betweendisqualified counsel and co-counsel, jointpreparation for trial by those counsel, or theapparent receipt by co-counsel of confidentialinformation." Id. Upon such a showing, a

rebuttable presumption arises that disqualifiedcounsel shared confidential information withco-counsel. The Court stated that thispresumption may be rebutted by providing"probative and material evidence that thetainted person . . . did not disclose confidentialinformation of his adversary." Id.

H. In re Meador, 968 S.W.2d 346 (Tex.1998).

In In re Dana Meador, the TexasSupreme Court addressed whether a lawyerwho receives an opponents' privilegedmaterials through no wrongdoing of his ownmust be disqualified. The Court recognizedthat no specific Texas disciplinary rule appliedto the circumstances of this case, butconcluded that a court has the power todisqualify an attorney even though he or shehas not violated a specific disciplinary rule.Although it had not been adopted by the Courtpursuant to the exercise of its rulemakingauthority, the Court found that ABA FormalOpinion 94-382 represented the standard towhich attorneys should aspire in dealing withan opponent's privileged information.However, the Court stated that it even ifFormal Opinion 94-382 had been adopted asthe disciplinary standard, it would only be aguideline for disqualification. Indeed, theCourt stated that it would be impossible toarticulate a bright-line standard fordisqualification where a lawyer receives anopponent's privileged materials through nowrongdoing of his own. Accordingly, theCourt identified six factors for a court toconsider when determining whether theinterests of justice required disqualification:(1) whether the attorney knew or should haveknown that the material was privileged; (2) thepromptness with which the attorney notifiesthe opposing side that he or she has receivedits privileged information; (3) the extent towhich the attorney reviews and digests theprivileged information; (4) the significance ofthe privileged information, i.e., the extent towhich its disclosure may prejudice themovant’s claim or defense, and the extent to



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which return of the documents will mitigatethat prejudice; (5) the extent to which themovant may be at fault for the unauthorizeddisclosure; and (6) the extent to which thenonmovant will suffer prejudice from thedisqualification of his or her own attorney.The Court expressed no opinion on the properstandard for disqualifying an attorney whowas directly involved in wrongfully procuringan opponent’s documents.

I. In re Users Sys. Serv., Inc., 22 S.W.3d331 (Tex. 1999).

In In re Users System Services, the TexasSupreme Court addressed whether a lawyershould be disqualified from continuing torepresent a litigant in a civil case for meetingwith an opposing party, at the party’s request,if prior to the meeting the party stated that hewas no longer represented by counsel, but hisformer attorney had not moved to withdrawfrom the case. Landerth, a plaintiff, phonedFrazier, a defendant, proposing a meeting atthe offices of plaintiffs’ counsel. Frazieraccepted. At the meeting Frazier presentedplaintiffs’ counsel with a letter stating that hehad terminated his representation with hisattorney and was no longer represented by anattorney. However, Frazier had not informedhis attorney that his services were beingterminated, and Frazier’s attorney had notwithdrawn as counsel. Defendantssubsequently moved to disqualify Plaintiffs’counsel based upon a violation of TexasDisciplinary Rule of Professional Conduct4.02(a), which provides: "In representing aclient, a lawyer shall not communicate orcause or encourage another to communicateabout the subject of the representation with aperson, organization or entity of governmentthe lawyer knows to be represented by anotherlawyer regarding that subject, unless thelawyer has the consent of the other lawyer oris authorized by law to do so." The trial courtdenied the motion. On writ on mandamus tothe Court of Appeals, the Court of Appealsreversed, reasoning that the Landerth-Fraziermeeting "at the law firm in the presence of a

firm attorney can only be interpreted as anencouragement" of communicationsprohibited by Rule 4.02. On writ ofmandamus to the Supreme Court, the Courtconditionally granted the writ directing theCourt of Appeals to vacate its order reversingthe trial court. The Supreme Court explainedthat "Rule 4.02 forbids a lawyer fromcommunicating with another person only ifthe lawyer knows the other person has legalcounsel in the matter." Although noting thatin some circumstances confirmation may benecessary before an attorney can determinewhether a person is no longer represented bycounsel, the Court concluded thatconfirmation is not required in every situation,and that in this case the attorney had no reasonto doubt Frazier’s assertion he was no longerrepresented by counsel. In so holding, theCourt expressly disagreed with ABA FormalOpinion 95-396, which provides that "ifretained counsel has entered an appearance . . .and remains counsel of record . . . thecommunicating lawyer may not communicatewith the person until the lawyer haswithdrawn her appearance."

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PROFESSIONAL RESPONSIBILITY: THE TEXAS ... attorney cannot be liable for malpractice allegedly resulting in a criminal conviction absent a showing that the plaintiff has been exonerated