Even careful law firms and clients involved in significant litigation might have their conduct jointly questioned in a sanctions motion filed against them. Because the law firm and the client are on the same side, many lawyers fail to recognize that such sanctions motions can create conflicts of interest. Thus, lawyers should remain mindful of the steps they should take if an opposing party threatens or files a sanctions motion against a client and/or the firm.
Because a sanctions motion involves the law firm’s previous work on behalf of the client, such as the filing of an action of questionable merit or preparation of responses to requests for electronic discovery, the law firm’s interests and the client’s interests may not be aligned. The firm may need to obtain consent to a conflict of interest, if obtainable, to continue representing the client in response to the motion for sanctions. It is important for lawyers to recognize that handling sanctions motions requires an objective review of the conflict before proceeding.
Sanctions Motion as a Material Limitation
A sanctions motion may create a material limitation conflict of interest if there is a substantial likelihood, based on the lawyer’s prior work for the client, that the lawyer’s ability to competently and diligently represent the client, going forward, is limited in a significant way. The lawyer’s advice and representation leading up to the sanctions motion may be called into question along with the client’s conduct. The lawyer and the client may have differing interests.
Client’s Consent to Lawyer’s Continued Representation
Consistent with the rules of professional conduct, the lawyer should advise the client of the risks and reasonable alternative of continuing the representation not withstanding a potential or actual conflict caused by the alleged conduct of the lawyer and/or the client leading to the filing of the sanctions motion. Depending on the lawyer’s role in conduct leading to the filing of the sanctions motion, the lawyer may or may not be able to provide competent and diligent representation such that informed consent may be obtained.
Obtaining Written Consent
To ensure the lawyer’s communications to the client about the potential or actual conflict caused by the threatened or filed sanctions motion is documented, the conflict must be confirmed in writing by a communication to any affected clients. While a confirming letter to the client may meet this requirement in some instances, the signed acknowledgement of the consent to conflict is a better confirmation that the client was fully informed.