can a lawyer who has an ownership interest in the company represent the company

An attorney representing a corporation does not represent its directors, officers, shareholders, employees, members, or other constituents. The corporation’s lawyer has “but one client—the corporation.” Attorneys may not represent the interests of one group of owners against the interests of another under the guise of representing the corporation.

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Can a lawyer for a corporation represent the shareholders?

As a general rule, the lawyer for an entity does not automatically represent the entity’s constituents. But sometimes the structure of a corporate family will create an attorney-client relationship with a corporation’s affiliates or subsidiaries even though the lawyer’s engagement letter says the lawyer does not represent them.

Does your law firm have a client-lawyer relationship with its corporations?

Feb 23, 2016 · 0 found this helpful | 0 lawyers agree Posted on Feb 24, 2016 While the corporation cannot represent itself in court, the corporation is not barred from engaging it's owner -- an attorney -- to represent it. If you find my answer is "HELPFUL" and/or the "BEST ANSWER" please mark it as such. I am not your attorney.

Can a company represent itself without an attorney?

Oct 04, 2016 · For many years, some lawyers have acquired an ownership interest in certain of their clients in connection with performing legal services, either by taking equity in lieu of cash fees or simply by investing money in return for equity.1,2An increasing number of start-up companies are in need of legal services, often with little or no

Can a lawyer represent a closely held entity as a client?

Levine & Baker LLP. Attorneys at Law. We've moved! As of January 1, 2019 our address is: 1034 Kearny Street. San Francisco CA 94133. Main Number: (415) …

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Can you retain more than one lawyer?

David Alan King

Yes, and it might be the most efficient way to deal with the case. Gauge for yourself when & if another attorney is necessary.

Jonah Michael Wolfson

I am unaware of anything that would prevent you from representing your own corporation as an attorney. I understand the question where a corporation needs to be represented by an attorney and not necessarily a president, etc. But the fact that you are a lawyer should take care of that.

Benjamin Soffer

While the corporation cannot represent itself in court, the corporation is not barred from engaging it's owner -- an attorney -- to represent it.

Andrew William Hyman

There is no prohibition that I am aware of preventing the attorney from doing so. Whether, in fact, the attorney should do so is another issue.

Can a lawyer enter into a business transaction with a client of another member of the firm?

For example, one lawyer in a firm may not enter into a business transaction with a client of another member of the firm without complying with paragraph (a), even if the first lawyer is not personally involved in the representation of the client.

What is the relationship between a lawyer and a client?

[20] The relationship between lawyer and client is a fiduciary one in which the lawyer occupies the highest position of trust and confidence. The relationship is almost always unequal; thus, a sexual relationship between lawyer and client can involve unfair exploitation of the lawyer's fiduciary role, in violation of the lawyer's basic ethical obligation not to use the trust of the client to the client's disadvantage. In addition, such a relationship presents a significant danger that, because of the lawyer's emotional involvement, the lawyer will be unable to represent the client without impairment of the exercise of independent professional judgment. Moreover, a blurred line between the professional and personal relationships may make it difficult to predict to what extent client confidences will be protected by the attorney-client evidentiary privilege, since client confidences are protected by privilege only when they are imparted in the context of the client-lawyer relationship. Because of the significant danger of harm to client interests and because the client's own emotional involvement renders it unlikely that the client could give adequate informed consent, this Rule prohibits the lawyer from having sexual relations with a client regardless of whether the relationship is consensual and regardless of the absence of prejudice to the client.

What is business transaction between client and lawyer?

[1] A lawyer's legal skill and training, together with the relationship of trust and confidence between lawyer and client, create the possibility of overreaching when the lawyer participates in a business, property or financial transaction with a client, for example, ...

What is the purpose of paragraph (b) of the law?

Paragraph (b) applies when the information is used to benefit either the lawyer or a third person , such as another client or business associate of the lawyer. For example, if a lawyer learns that a client intends to purchase and develop several parcels of land, the lawyer may not use that information to purchase one of the parcels in competition with the client or to recommend that another client make such a purchase. The Rule does not prohibit uses that do not disadvantage the client. For example, a lawyer who learns a government agency's interpretation of trade legislation during the representation of one client may properly use that information to benefit other clients. Paragraph (b) prohibits disadvantageous use of client information unless the client gives informed consent, except as permitted or required by these Rules. See Rules 1.2 (d), 1.6, 1.9 (c), 3.3, 4.1 (b), 8.1 and 8.3.

Can a lawyer accept a gift?

If a client offers the lawyer a more substantial gift, paragraph (c) does not prohibit the lawyer from accepting it, although such a gift may be voidable by the client under the doctrine of undue influence, which treats client gifts as presumptively fraudulent. In any event, due to concerns about overreaching and imposition on clients, a lawyer may not suggest that a substantial gift be made to the lawyer or for the lawyer's benefit, except where the lawyer is related to the client as set forth in paragraph (c).

Can a lawyer subsidize a lawsuit?

[10] Lawyers may not subsidize lawsuits or administrative proceedings brought on behalf of their clients, including making or guaranteeing loans to their clients for living expenses, because to do so would encourage clients to pursue lawsuits that might not otherwise be brought and because such assistance gives lawyers too great a financial stake in the litigation. These dangers do not warrant a prohibition on a lawyer lending a client court costs and litigation expenses, including the expenses of medical examination and the costs of obtaining and presenting evidence, because these advances are virtually indistinguishable from contingent fees and help ensure access to the courts. Similarly, an exception allowing lawyers representing indigent clients to pay court costs and litigation expenses regardless of whether these funds will be repaid is warranted.

What is literary rights?

[9] An agreement by which a lawyer acquires literary or media rights concerning the conduct of the representation creates a conflict between the interests of the client and the personal interests of the lawyer.

Is a sole proprietorship a corporation?

Sole proprietorships are not considered voluntary associations. Unlike an LLC, a sole proprietorship is completely unincorporated, thus it is not a corporation or voluntary association. Therefore, courts do not require the owner of a sole proprietorship to hire an attorney to represent the proprietorship in legal proceedings.

What is voluntary association?

Voluntary associations are companies that have attributes of limited liability protection. These include limited liability companies, often referred to as LLCs. However, if a company is not a voluntary association or corporation, they may not be required to hire counsel.

What is a small claims action?

Claims or cause of action brought by an insurer in its own name or in the name of the insured. A small claims commercial action; or defending small claims non-commercial actions.

What is a school district?

School districts or school district public libraries. Claims or cause of action brought by an insurer in its own name or in the name of the insured. A small claims commercial action; or defending small claims non-commercial actions.

Can a lawyer enter into a business transaction with a client?

(a) A lawyer shall not enter into a business transaction with a client or knowingly acquire an ownership, possessory, security or other pecuniary interest adverse to a client unless:

Can lawyers invest in their clients?

It is certainly clear today that lawyers can invest in their clients in a manner that satisfies their obligations under the professional responsibility rules that govern lawyers’ ethical obligations to their business clients. Indeed, many lawyers view these arrangements as having significant potential to strengthen the bond between lawyer and client and are often perceived as a vote of confidence in the client’s business prospects. In addition, there is anecdotal evidence that attorneys who accept stock in lieu of fees (or defer legal fees) actually build loyal followings by their clients. Finally, with respect to start-up businesses with limited cash resources but a promising future, taking stock in lieu of fees (or alternatively, as a supplement to the payment of reduced legal fees in cash) may be the only way for these new businesses to access quality legal representation. On the other hand, there are many experienced lawyers who view these arrangements with great suspicion and as inherently presenting conflicts of interest that disable the lawyer from being able to practice law according to the highest ideals of professional ethics and fiduciary obligations. These commentators believe that it is simply unrealistic to believe that lawyers will be able to exercise independent judgment and give advice to their clients without this advice being unduly influenced by their

What does "comply with federal and state securities laws" mean?

(f) Comply with federal and state securities laws, including determining whether the acquisition of stock will increase or complicate the client’s disclosure or licensing requirements.

What is the relationship between a lawyer and a client?

[1] Loyalty and independent judgment are essential elements in the lawyer's relationship to a client. Concurrent conflicts of interest can arise from the lawyer's responsibilities to another client, a former client or a third person or from the lawyer's own interests. For specific Rules regarding certain concurrent conflicts of interest, see Rule 1.8.

What is a conflict of interest in a lawyer?

[8] Even where there is no direct adverseness, a conflict of interest exists if there is a significant risk that a lawyer's ability to consider, recommend or carry out an appropriate course of action for the client will be materially limited as a result of the lawyer's other responsibilities or interests. For example, a lawyer asked to represent several individuals seeking to form a joint venture is likely to be materially limited in the lawyer's ability to recommend or advocate all possible positions that each might take because of the lawyer's duty of loyalty to the others. The conflict in effect forecloses alternatives that would otherwise be available to the client. The mere possibility of subsequent harm does not itself require disclosure and consent. The critical questions are the likelihood that a difference in interests will eventuate and, if it does, whether it will materially interfere with the lawyer's independent professional judgment in considering alternatives or foreclose courses of action that reasonably should be pursued on behalf of the client.

What is an organizational client?

[1] An organizational client is a legal entity, but it cannot act except through its officers, directors, employees, shareholders and other constituents. * * * The duties defined in this Comment apply equally to unincorporated associations. “Other constituents” as used in this Comment means the positions equivalent to officers, directors, employees and shareholders held by persons acting for organizational clients that are not corporations * * * * * [3] When constituents of the organization make decisions for it, the decisions ordinarily must be accepted by the lawyer even if their utility or prudence is doubtful. Decisions concerning policy and operations, including ones entailing serious risk, are not as such in the lawyer's province. Paragraph (b) makes clear, however, that when the lawyer knows that the organization is likely to be substantially injured by action of an officer or other constituent that violates a legal obligation to the organization or is in violation of law that might be imputed to the organization, the lawyer must proceed as is reasonably necessary in the best interest of the organization. As defined in Rule 1.0(i), knowledge can be inferred from circumstances, and a lawyer cannot ignore the obvious.

What are the requirements of paragraph (a)?

The requirements of paragraph (a) must be met even when the transaction is not closely related to the subject matter of the representation, as when a lawyer drafting a will for a client learns that the client needs money for unrelated expenses and offers to make a loan to the client . The Rule applies to lawyers engaged in the sale of goods or services related to the practice of law, for example, the sale of title insurance or investment services to existing clients of the lawyer's legal practice. See Rule 5.7. It also applies to lawyers purchasing property from estates they represent. It does not apply to ordinary fee arrangements between client and lawyer, which are governed by Rule 1.5, although its requirements must be met when the lawyer accepts an interest in the client's business or other nonmonetary property as payment of all or part of a fee. In addition, the Rule does not apply to standard commercial transactions between the lawyer and the client for products or services that the client generally markets to others, for example, banking or brokerage services, medical services, products manufactured or distributed by the client, and utilities' services. In such transactions, the lawyer has no advantage in dealing with the client, and the restrictions in paragraph (a) are unnecessary and impracticable.

Does the attorney-client privilege apply to all communications with a lawyer?

Many laymen, and a disturbing number of lawyers, believe that the attorney-client privilege attaches to all communications with a lawyer. This is not true. The attorney-client privilege only applies where the communications are between a lawyer and a client for the purpose of giving or receiving legal advice, and are expressed in confidence.

Can a lawyer practice law without a license?

This is dangerous. Practicing law without a license is a crime, an ethical violation where you are licensed, can get your colleagues in ethical trouble (as they are prohibi ted from assisting in the unauthorized practice of law by the Rules), and may impact your client's attorney-client privilege. The good news is many states have "single-client" rules that allow in-house counsel to register in the state where they office but keep up their licenses in another state.

What is a direct adverse conflict?

"Directly Adverse" Conflicts under Rule 1.7 (a) (1). When in-house counsel represents groups of related companies, or officers, directors, owners, or employees at the company where he is in-house , it is easy to develop a "directly adverse" conflict under Rule 1.7 (a) (1). Representation of subsidiaries may occur in dealing with a third-party, and this can lead to a conflict when issues arise between the subsidiary and parent. In other cases, it may be mere inadvertence that creates the attorney-client relationship between the in-house lawyer and someone other than the company that employs him. For example, when an in-house lawyer answers legal questions from officers, employees, or owners about their legal issues (not those of the company), this can create an attorney-client relationship and thus the chance of a "directly adverse" conflict.

Is there a difference between an outside counsel and an in-house counsel?

Analytically, there is no difference between an outside counsel going in on a business venture with a client and an in-house counsel being offered stock or stock options in the client. In both instances, the lawyer is engaging in a business transaction with the client, and so the requirements of Rule 1.8 must be followed.

What is the substantive rule for in-house counsel?

It reminds all lawyers that the definition of "Firm" in Rule 1.0 includes "the legal department of a corporation or other organization." As such, when one in-house lawyer is disqualified, the disqualification can be imputed to the entire in-house department.

What is the rule for a confidentiality wall?

Rule 1.11 allows a confidentiality wall to segregate an attorney who previously "personally and substantially" worked on a matter for an adverse government agency. If the lawyer that previously "personally and substantially" worked on a matter came from another in-house job or private practice, however, then a confidentiality wall is ineffective and the entire in-house department may be disqualified.

Do in-house counsel have another job?

Many in-house counsel also have another job (Vice-President, Secretary, etc.). Most courts addressing these "dual capacities" have held the legal ethical rules still apply even when the lawyer is acting in his "other" capacity. This was another argument made by the lawyer but rejected in Kaye.

Business Transactions Between Client and Lawyer

Use of Information Related to Representation

Gifts to Lawyers

Literary Rights

Financial Assistance

Person Paying For A Lawyer's Services

Aggregate Settlements

Limiting Liability and Settling Malpractice Claims

Acquiring Proprietary Interest in Litigation

• Paragraph (i) states the traditional general rule that lawyers are prohibited from acquiring a proprietary interest in litigation. Like paragraph (e), the general rule has its basis in common law champerty and maintenance and is designed to avoid giving the lawyer too great an interest in the representation. In addition, when the lawyer acquires an...

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Client-Lawyer Sexual Relationships