Ethics Advisory Opinion 15-02

Utah State Bar

Ethics Advisory Opinion Committee

Opinion Number 15-02

Issued February 10, 2015




1.  May an attorney representing a party in pending or existing litigation contact servants, agents, and employees of an organization, which is the opposing party, to discuss issues directly related to the litigation, if the attorney is aware the organization is represented by counsel in the matter?  Is it ethical for an attorney to make contact directly with in-house or corporate counsel, even if the attorney is aware that the organization is represented by outside counsel in the matter?  Is it ethical for an attorney to send a copy of correspondence or email to an organization’s employee where the original is directed to opposing counsel?


2.  The query before the Committee relates to the issue of the propriety of an attorney making contact with a servant, agent, or employee of an organization which is potentially or is in fact involved in litigation, where the contacting attorney knows or has reason to know that the organization is represented by counsel.  The related question pertains to the same issue, except that the contact in question is with the organization’s in-house or corporate counsel.  Lastly, is it ethical for an attorney to send a copy of correspondence to an employee, the original of which is directed to opposing counsel for an organization?


3.  Communications, concerning the subject matter of anticipated, proposed or current litigation, are improper, if the individual being contacted is either (1) an employee of the target organization within the current “control group,” or (2) the individual’s acts, omissions or statements in the matter might be imputed to the opposing organization.  Contact with in-house counsel may be permissible, depending on the circumstances, as discussed below.


 4.  This opinion involves what has sometimes been referred to as the “no contact without consent” rule.  Utah Rules of Professional Conduct (URPC), Rule 4.2, Communication with Persons Represented by Counsel, states the general rule as follows:

(a) General Rule. In representing a client, a lawyer shall not communicate about the subject of the representation with a person the lawyer knows to be represented by another lawyer in the matter, unless the lawyer has the consent of the other lawyer.  Notwithstanding the foregoing, an attorney may, without such prior consent, communicate with another’s client if authorized to do so by any law, rule, or court order,[1] in which event the communication shall be strictly restricted to that allowed by the law, rule or court order, or as authorized by paragraphs (b), (c), (d) or (e) of this Rule.[2]

5.  As a general matter, subject to the exception that a lawyer may “communicate with another’s client if authorized to do so by any law, rule, or court order,” Rule 4.2 requires that a lawyer not communicate “about the subject of the representation with a person the lawyer knows to be represented by another lawyer in the matter, unless the lawyer has the consent of the other lawyer.”  Rule 4.2(a) (emphasis added).  The Rule “applies to communications with any person who is represented by counsel concerning the matter to which the communication relates,” and “applies even though the represented person initiates or consents to the communication. A lawyer must immediately terminate communication with a person if, after commencing communication, the lawyer learns that the person is one with whom communication is not permitted by this Rule.”  Comment (3) and (4) to Rule 4.2.  Rule 4.2 is broadly consistent with the general rules set forth in § 99, A Represented Nonclient – The General Anti-Contact Rule, The Restatement (Third) of the Law Governing Lawyers; See also The Law of Lawyering, Hazard, Hodes & Jarvis, §§ 4.01 and 41.02.

Ethics Advisory Opinion 14-01

Utah State Bar
Ethics Advisory Opinion Committee 

Opinion Number 14-01

 Issued January 15, 2014


1.         Under what conditions is it appropriate for a personal injury lawyer to “outsource the calculation, verification and resolution of alleged health insurance liens and subrogation/reimbursement claims” and pass the outsourced resolution fee to the client as a “cost.”  There are two questions posed to the committee.  First, can the lawyer appropriately outsource the lien resolution?  Second, is the treatment of the lien resolution fee appropriately treated a “cost” to the client?


2.         It is ethical for a personal injury lawyer to engage the services of a lien resolution company that can provide expert advice or to associate with a law firm providing this service.

3.         If properly disclosed in the retention agreement, fee resolution services may be included as “costs” to the client provided the resolution services are professional services equivalent to accountants or appraisers.

4.         If the services provided constitute the practice of law, the personal injury lawyer and the lien resolution company must comply with the fee splitting requirements of Rule 1.5(c) and (d).  Then, the lawyer cannot treat the lien resolution fee as a cost to the client. If the services constitute the practice of law, it may be proper for a lien resolution company to collect a contingency fee.


5.         The federal or state government pays many, if not most, seriously injured plaintiffs’ medical bills through Medicaid[1] or Medicare.[2]  Insurers, industrial unions and other private third-party payers have subrogation rights to monies collected from solvent third parties.  Finally, in Utah, Utah Code Annotated 38-7-1 et seq provides for hospital liens on judgments, settlements or compromise in certain accident cases.[3]

6.         In straightforward simple cases, little difficulty arises.  However, in order to settle complicated injury cases, plaintiff’s counsel must account for these liens. This may require substantial expertise. Counsel must ascertain the correct amount payable for each lien.[4]  The assistance of experts in lien resolution advances the laudable goal of fair resolution to both the client and the lien holder.

7.         In recent years, third party entities have held themselves out as “Lien Resolution” companies.  The services offered are often a significant value enhancement for the client.  Many plaintiffs’ personal injury lawyers might lack the necessary competence in reading medical bills for the purpose of attributing costs to the plaintiff’s general health as opposed to the accident.

8.         The issue of whether such services should be treated as “costs” or as “attorney’s fees” depends upon the factual nature of the work performed.  One company describes its services as addressing “Medicare conditional payments, Medicaid, Tricare[5], Veterans Affairs, FEHBA[6], ERISA[7], Private Insurance and Hospital/Provider lien claims.”[8] The services offered include reporting to the appropriate government agency, calculation of the amounts due, verification of the accuracy of the lien, and final resolution of the claim.  This firm charges a flat fee for simple Medicaid/Medicare resolution.  It charges a contingency fee based upon percentage of saving in cases that are more complex.

9.         Other lien resolution companies describe their staff as medical billing specialists, nurses and attorneys familiar with federal law beyond the knowledge possessed by the ordinary plaintiff’s personal injury lawyer. They claim that their services include a determination of the personal injury lawyer’s affirmative obligation to notify healthcare plans.  They “will assess the healthcare plans’ rights of recovery and audit the reimbursement claims to ‘carve out’ items unrelated to injury/settlement.”  They will then pursue administrative remedies, such as damage allocation, waiver and compromises to ensure the appropriate ‘net recovery’ for the claimant.  If the claim is not resolved administratively and goes to adjudication, they provide legal authority and support for the personal injury attorney in dealing with the agency.  Those companies charge a flat fee based upon the amount of the total settlement or verdict.    They characterize their service as providing the personal injury lawyer with sufficient facts and familiarity with the law.  This allows the personal injury lawyer the ability to negotiate liens on equal terms with the lienholder’s lawyer.  In essence, they believe that they are providing expert advice coupled with specialized legal resources for the personal injury attorney.

04-04 – In litigation to enforce an oral contract allegedly made by a corporate defendant’s former employee

August 25, 2004

1 Issue: In litigation to enforce an oral contract allegedly made by a corporate defendant’s former employee on behalf of the corporation, where the former employee was not a member of the control group, may the plaintiff’s attorney contact the ex-employee without the consent of the corporate defendant’s attorney?

2 Answer: The contact with the former employee is not unethical. Utah Rules of Professional Conduct 4.2 (2004) does not bar a lawyer’s unauthorized contact with former employees of a represented corporate defendant except in very limited circumstances not applicable to this opinion.
3 Facts: A corporate defendant is represented by a lawyer in the defense of a claim based on an oral agreement allegedly made by a former employee of the corporate defendant while employed by the corporate defendant. The former employee was not a member of the “control group” as this term is defined in Utah Rules of Professional Conduct 4.2(c) (2) (2004), but the former employee did have authority to enter into contracts. The former employee is not separately represented by legal counsel with respect to the matter. We are asked whether the lawyer representing the corporate defendant represents the former employee with respect to the matter under Rule 4.2(c)(1)(B)(iii), thereby precluding plaintiff’s counsel from communicating with the former employee with respect to the matter without complying with Rule 4.2(a).
4 Analysis: In 1991, the ABA’s Committee on Ethics and Professional Responsibility addressed whether Model Rule 4.2 limits contacts with former employees. In ABA Formal Opinion 91-359 (1991), the ABA Committee concluded it does not. In pertinent part, the opinion provides:
While the Committee recognizes that persuasive policy arguments can be and have been made for extending the ambit of Model Rule 4.2 to cover some former corporate employers [sic], the fact remains that the text of the Rule does not do so and the comment gives no basis for concluding that such coverage was intended. Especially where, as here, the effect of the Rule is to inhibit the acquisition of information about one’s case, the Committee is loath, given the text of Model Rule 4.2 and its Comment, to expand its coverage to former employees by means of liberal interpretation.
Accordingly, it is the opinion of the Committee that a lawyer representing a client in a matter adverse to a corporate party that is represented by another lawyer may, without violating Model Rule 4.2, communicate about the subject of the representation with an unrepresented former employee of the corporate party without the consent of the corporation’s lawyer.
5 The only Utah court to have carefully considered this issue followed the ABA’s interpretation of Model Rule 4.2 at a time when Utah Rules of Professional Conduct 4.2 mirrored the Model Rule. In Shearson Lehman Bros., Inc. v. Wasatch Bank, 139 F.R.D. 412 (D. Utah 1991), plaintiff’s counsel sought to interview 24 former bank tellers regarding bank practices during the time an employee allegedly fraudulently endorsed checks. The court held:
Today this court joins the ranks of those which have construed Rule 4.2 consistently with the position taken by the ABA Committee on Ethics and Professional Responsibility. Under this court’s rules of practice, Utah Rule of Professional Conduct 4.2 as well as ABA Model Rule 4.2 do not prohibit ex parte contact with the former employees of an organizational party that is represented by counsel.

Ethics Advisory Opinion No. 04-06

December 2, 2004
Under what circumstances is it permissible for corporate counsel to assert that counsel concurrently represents present and former corporate employees whose testimony is relevant to a claim and ethically preclude opposing counsel’s access to those corporate employee witnesses?

Opinion: If corporate counsel has actually formed an attorney-client relationship with these employee-witnesses, and has fully complied with Utah Rules of Professional Conduct 1.7 (including obtaining informed consent from all multiple clients to joint representation and informing them of the possible need for withdrawal from representing any of them should an actual conflict arise), this is permissible and opposing counsel may not interview them. However, in the absence of such a fully formed and proper attorney-client relationship, it is improper for corporate counsel to block opposing counsel’s access to other current corporate constituents, by asserting an attorney-client relationship unless these individuals were control group members, their acts could be imputed to the organization or their statement would bind the corporation with respect to the matter under Utah Rules of Professional Conduct 4.2. Similarly, it is improper to block opposing counsel’s access to any former employee in the absence of a current fully formed and proper attorney-client relationship.
Facts: The tort action asserts one corporate employee and an outside individual were negligent, but names only the corporate entity (and the outside individual) as defendants. Counsel for plaintiff seeks to interview other employees who are fact witnesses and who are not alleged to be negligent. Corporate counsel informs plaintiff’s counsel that s/he is representing all corporate employees (current as well as former employees) and thus plaintiff’s counsel may not informally interview any of these individuals without violating Rule 4.2.
Analysis: Whether corporate counsel’s actions are proper must be determined by reference
to Rule 1.7 regarding conflicts of interest, Rule 4.2 as it governs counsel’s ability to interview “represented persons” in the corporate context, and Rule 3.4 as it permits corporate counsel to request that corporate employees not talk with opposing counsel.
Rule 4.2 1 provides in relevant part:
(a) General Rule. A lawyer who is representing a client in a matter shall not communicate about the subject of the representation with a person the lawyer knows to be represented by another lawyer in the matter, unless the lawyer has the consent of the other lawyer or is authorized to do so by [other law or judicial order].
Utah’s Rule 4.2 2 expressly addresses “Organizations as Represented Persons” and defines when an individual constituent of that organization, not separately represented, should be considered to be “represented” by corporate counsel. With respect to non-governmental organizations, Rule 4.2 states:
(c)(1)(B) When the represented “person” is an organization, an individual is “represented” by counsel for the organization if the individual is not separately represented . . . and . . . is known by the lawyer to be
(c)(1)(B)(i) a current member of the control group of the represented organization; or
(c)(1)(B)(ii) a representative of the organization whose acts or omissions in the matter may be imputed to the organization under applicable law; or
(c)(1)(B)(iii) a representative of the organization whose statements under applicable rules of evidence would have the effect of binding the organization with respect to proof of the matter. (more…)

Ethics Advisory Opinion No. 99-06

(Approved August 27, 1999)
: As a part of a criminal plea bargain agreement in a DUI case, may either the prosecuting attorney or the defense lawyer seek the concurrence of the investigating police officer not to respond to a subpoena lawfully issued by the Utah Driver License Division in connection with the related driver-license revocation hearing, a state administrative proceeding?

Opinion: No. Such conduct violates Rule 3.4(a) and 8.4 of the Utah Rules of Professional Conduct.
Facts: In cases involving operation of a motor vehicle while under the influence of alcohol (“DUI”), two actions are initiated. The first is the criminal DUI action. The second is an administrative hearing before the Driver License Division of the Utah Department of Public Safety (“DLD”) to consider whether to revoke or suspend the defendant’s driver license (the “DLD hearing”).
In connection with the DLD hearing, the investigating police officer is served with a subpoena to appear at that hearing. Before the DLD hearing takes place, the defendant’s lawyer and the prosecuting attorney1agree to resolve the criminal DUI action. As a part of the plea-bargain discussion or after the agreement is reached, but before the DLD hearing, either the defendant’s lawyer or the prosecuting attorney contacts the investigating officer to indicate that (1) a compromise or a “deal” has been worked out concerning the charge against the defendant, and (2) a part of the deal is that the police officer will not appear at the DLD hearing. Notwithstanding the issued subpoena, non-appearance forecloses the presentation of any evidence against the defendant at the DLD hearing and is tantamount to “saving” the defendant’s license from being suspended or revoked. As a result of the investigating officer’s non-appearance at the DLD hearing, the administrative action is dismissed, and no action is taken relating the defendant’s driver’s license.
Analysis: Section 76-8-508 of the Utah Code provides:
A person is guilty of a third degree felony if, believing that an official proceeding or investigation is pending or about to be instituted, he attempts to induce or otherwise cause a person to . . . (b) withhold any testimony, information, document, item; (c) elude legal process summoning him to provide evidence; or (d) absent himself from any proceeding or investigation to which he has been summoned.2
On the facts related to the Committee in this request, a major element of the overall plea-bargain arrangement is the agreement that the subpoenaed police officer will not testify or, at least, will be asked to concur with the “deal” and not respond to the DLD subpoena. In the process of striking such a plea bargain on the DUI charge, if either the defense lawyer or the prosecuting attorney has induced (or attempted to induce) the police officer not to respond to a validly issued subpoena to appear at the DLD hearing, that lawyer appears to be in violation of Utah law.
Rule 8.4 of the Utah Rules of Professional Conduct specifies when a violation of the law constitutes an ethical transgression: “It is professional misconduct for a lawyer to . . . [c]ommit a criminal act that reflects adversely on the lawyer’s honesty, trustworthiness, or fitness as a lawyer in other respects”3or to “engage in conduct that is prejudicial to the administration of justice.”4 (more…)