Pileggi on Corporate Conflicts Issue

In response to the invitation to describe recently written work related to legal ethics, Francis Pileggi was kind enough to send us a description of an article that he published in the January/February 2006 issue of The Bencher, a publication of the American Inns of Court. 

Francis writes an ethics column for that publication and co-chairs the ABA Litigation Section's Ethics Subcommittee of the Business Litigation Committee.  He was the founding partner of the Wilmington, Delaware office of Fox Rothschild LLP.  He continues to practice in the Litigation Department, where he handles business litigation.  He also maintains a blog that covers corporate and commercial litigation decisions in the Delaware courts: www.delawarelitigation.com

Here's a description of Francis's article, which can be downloaded at http://www.delawarelitigation.com/commentary-354-ethical-conflicts-representing-shareholder-and-corporation.html:

The article, “Florida Appellate Court Allows Attorney to Represent Majority Shareholder But Not Corporation,”summarized the recent decision from the Florida Court of Appeals in Campelloni v. Cragan.  The Appellate Court ruled that despite a conflict that prevented an attorney from representing both the corporation and the majority shareholder in defending derivative and direct claims against the majority shareholder, the same attorney would not be prevented from defending only the majority shareholder.  The court addressed the Florida version of Rules 1.13 and 1.7.  The court acknowledged that Rule 1.13 addresses the issue of dual representation of an organization and the corporate constituent and allows dual representation subject to the provisions of Rule 1.7.  Rule 1.7 addresses conflicts with current clients and Rule 1.9 describes duties to former clients.  Similar issues were discussed by the Delaware Chancery Court in the case of Unanue v. Unanue, 2004 WL 602096. The Florida appellate court found that Rule 1.9(a) did not support a finding that the prior representation of the corporation by the majority shareholder’s attorney should prevent that same attorney from representing the majority shareholder in the same case.  The Florida Court of Appeals found that a new attorney would be privy to the same information that the majority shareholder’s current attorney would have in light of the majority shareholder already possessing that information. 

Thank you, Francis, for the description of your work.  The invitation to publish descriptions of legal ethics writings is open, so if anyone else would like to post something here, feel free to contact me.

Comments

[Bill Freivogel]

Yes, and for additional authorities on derivative actions go to www.freivogelonconflicts.com. In the Table of Contents click on "Derivative Actions." How's that for blowing ones own horn?

[Francis Pileggi]

Thanks for the post about my article. I appreciate it. Thanks also to the famous Bill Freivogel for providing the link to his very useful site.

[Ronaldinho]

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[Ronaldinho]

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