Deferred Prosecution Agreements Reached with Former Dewey & LeBoeuf Lawyers

It’s always a good idea to remind your students to be careful if they should ever take on the responsibility of managing a law firm, especially in times of financial bust. If you have been following the Dewey & LeBoeuf criminal trial, you know that the jury deadlocked in October of last year on dozens of charges against Steven H. Davis, the former chairman of Dewey, and two other former executives of the law firm, Stephen DiCarmine and Joel Sanders. The three men were accused of being the architects of an accounting fraud that enabled Dewey to defraud its lenders and creditors during much of the financial crisis.

In January of this year, Manhattan prosecutors reached a deferred prosecution agreement with Steven H. Davis. The agreement runs for five years and prohibits Davis from practicing law in New York during that period.

In February, prosecutors reached a deferred prosecution agreement with Zachary Warren, one of the four original defendants, just weeks before he was supposed to go on trial in the New York State Supreme Court in Manhattan. Notably, Warren was not a lawyer when he worked as the client relations manager at Dewey & Leboeuf. After leaving Dewey, he went on to graduate from Georgetown Law Center and clerked for a federal judge.  He plans on working at Williams & Connolly in the fall.   The agreement requires Warren to perform 350 hours of community service as part of a one year agreement.

The Manhattan prosecutors are planning to retry the case against DiCarmine and Sanders.

Articles about the agreements reached with Davis and Warren can be found here and here.

New ABA Opinion on Ethical Duty when Client Documents are Subpoenaed

In Formal Opinion 473 (Feb. 17, 2016), the ABA provides new guidance to lawyers receiving subpoenas for client documents or information.  The opinion states that whenever a lawyer receives a subpoena or any other compulsory process for documents or information relating to the representation of a client, several obligations are implicated.  First, the lawyer must consult with the the client, if the client is available.  Next, unless the client instructs otherwise, the lawyer must assert all reasonable claims against disclosure and seek to limit the scope of any disclosure.  Next, if ordered to produce any information, the lawyer should consult with the client on whether to appeal the ruling.  Finally, if the client and the lawyer disagree on how to proceed, the lawyer should consider whether to withdraw from the representation pursuant to Rule 1.16.

The new opinion goes into some detail to explain what the lawyer should do if the client is unavailable, and to the duty to take steps to protect client confidentiality.  The opinion should be a very helpful resource to any lawyer facing attempts to pierce client confidentiality.

The new opinion is also a useful addition to Formal Opinion 10-456 (July 14, 2010), which addressed the disclosure of client information to a prosecutor when a lawyer’s former client brings an ineffective assistance of counsel claim.  Formal Opinion 10-456 makes clear that a lawyer may only disclose confidential information that the lawyer believes is reasonably necessary for the lawyer’s self-defense.

 

Prosecutorial Accountability – An Optimistic Future

Bruce Green and Ellen Yaroshefsky recently posted a new article on SSRN, Prosecutorial Accountability 2.0.  They identify several rhetorical and regulatory shifts that they claim are leading to an era of new prosecutorial accountability.  In their carefully crafted article, they argue that information technology is the main driver behind this shift to hold prosecutors accountable for their actions. They claim that the pendulum long fixed on courts and the media presuming that prosecutors could do no wrong has swung to a more skeptical position.  Let’s hope they are right. Anyone interested in the criminal justice system should read this article.

New Study Out: The Prevalence of Substance Use and Other Mental Health Concerns Among American Attorneys

As a former Lawyer Assistance Program Executive Director at Lawyers Concerned for Lawyer in Massachusetts, I was distressed by the new study that reveals: (1) young lawyers are at an increased risk of problem drinking and mental health issues; and (2) overall these issues in the legal profession may be higher than previously thought.  The study was conducted jointly by the ABA Commission on Lawyer Assistance Programs (CoLAP) and the Hazelden Betty Ford Foundation.

According to the study:
  • 21% of licensed, employed attorneys are problem drinkers;
  • 28% struggle with some level of depression; and
  • 19% demonstrate symptoms of anxiety.
Each semester, I take a few minutes in PR to address the availability of LAPs for lawyers and law students.  And, I include coverage of Rule 8.3 at the same time. If you’re interested in talking points, feel free to email me – murphyme@wfu.edu.  I also have had LAP staff and members speak with my class, with great success.  Video conferencing makes this even easier today.  In addition, CoLAP has a range of resources, including links to LAPs in each state, speaker lists, and articles.

More on the study from the ABA here; from the ABA Journal here; and from the NYTimes here.  A copy of the study from the Journal of Addition Medicine is available here.

Jury in Dewey & LeBoeuf Criminal Trial Acquits on Some Charges, Deadlocks on Others

A Manhattan jury today (October 7, 2015) cleared three former executives of Dewey & LeBoeuf on falsifying business records charges. However, the jurors remained deadlocked on dozens of other charges. The three executives, all trained as lawyers, are being accused of masterminding a four-year scheme to manipulate the finances of the once-prominent law firm in an effort to keep it afloat during the financial crisis.  They were charged with a range of crimes including grand larceny, scheme to defraud, and falsifying business records. Prosecutors working under Manhattan district attorney Cyrus R. Vance, Jr. called more than 40 witnesses to support the prosecution’s case. Recent update on the case is here. Prior blogposts can be found here.

Okay to Advise on Setting Up Medical Marijuana Business? States Differ

On the heels of a recent disciplinary decision finding that the Hawaii Rules of Professional Conduct prohibit attorneys from counseling clients to commit a crime or assisting in a crime – specifically that lawyers can’t provide legal services to help set up a medical marijuana business – the Hawaii Supreme Court is seeking comments on a proposed rule change to allow lawyers to counsel clients on conduct permitted under state law, but prohibited under federal.  More here from Law360.  More on how other states have approached the issue (inconsistently) here.
H/T to Marilyn Forbes Phillips @ Duke Law.