Privilege to Practice: Big or small, the same rules apply

Issue January/February 2018 By Richard P. Campbell

When reading the rules of professional conduct, or reports of disciplinary actions pursued by bar counsel, or published decisions by the Supreme Judicial Court imparting disbarments or suspensions, it is quite easy to aggregate the information and classify the conduct as acts or omissions by solo practitioners or lawyers in small, struggling law firms. It is true, of course, that many of the lawyers at the wrong end of disciplinary actions were short on finances or staff or both. Beginning with this column, however, I turn my attention to lawyers employed by large law firms with near-limitless finances, broad and deep support staffs, and fee income that is breathtaking in amount.

Milberg LLP was a large Manhattan law firm that held itself out as one of the nation’s leading plaintiff law firms prosecuting class actions and other complex litigation with, according to the firm, legendary results. (Note: Just before Lawyers Journal went to press in February, the firm announced it was forming a strategic partnership with another firm under the new name Milberg Tadler Phillips Grossman.)

The firm’s former website description of its history and practice give a sense of Milberg LLP, noting it was “one of the first law firms to prosecute class actions in federal courts on behalf of investors and consumers,” has a large and varied support staff, and “has been responsible for recoveries valued at approximately $55 billion during the life of the Firm.” Of importance to this article, Milberg identified qui tam actions as one of its specialty areas of practice.

In 2012, Milberg lawyers filed a qui tam action in the U.S. District Court for the District of Massachusetts, originally styled as United States of America, et al, ex rel, Timothy Leystock v. Forest Laboratories, Inc., Civil Action No. 12-11354 –FDS. The Milberg lawyers of record were partners Matthew Gluck and James Shaughnessy, and counsel Alastair J.M. Findeis. All three lawyers were admitted to practice in New York. Shaughnessy and Findeis were also admitted to practice in one or more additional jurisdictions. None of the three lawyers were admitted to practice law in Massachusetts, however. Consequently, David Pastor, a Massachusetts practitioner, filed an appearance as counsel for the plaintiff and moved for the admission of Gluck, Shaughnessy and Findeis pro hac vice in accordance with Local Rule 83.5.3.

By operation of Local Rule 83.6.1(a), “[t]he rules of professional conduct for attorneys appearing and practicing before [the United States District Court for the District of Massachusetts] shall be the Massachusetts Rules of Professional Conduct adopted by the Massachusetts Supreme Judicial Court. …” Local Rule 83.6.1 (d) is explicit: “Compliance with Rules Required. All attorneys who are admitted or authorized to practice before this court shall comply with its rules of professional conduct in all matters they handle before this court.”

Surely, a bedrock role for local counsel is the assurance that lead counsel from another jurisdiction is made aware of important substantive laws that may impact preparation and trial of the case. Legal privileges, confidentiality and privacy laws are obvious examples of important substantive state laws. But both local counsel and counsel appearing pro hac vice must meet the mandate of Rule 1.1: “A lawyer shall provide competent representation to a client. Competent representation requires the legal knowledge, skill, thoroughness, and preparation reasonably necessary for the representation.”

The preamble to the code instructs that lawyers have a “special responsibility for the quality of justice” because among their various roles they are “officer[s] of the legal system.” “[L]awyer[s’] conduct should conform to the requirements of the law;” they “should use the law’s procedures only for legitimate purposes;” and they “should demonstrate respect for the legal system.” Lawyers are charged with “the exercise of sensitive professional and moral judgment guided by the basic principles underlying the Rules rectitude of official action.” Rules of Professional Conduct: Preamble: A Lawyer’s Responsibilities, ¶’s 1, 4, and 8.

In a written decision issued by Judge Saylor on April 28, 2017, the court found that “the Milberg lawyers engaged in an elaborate scheme of deceptive conduct in order to obtain information from physicians about their prescribing practices, and in some instances about their patients.” Using their financial resources and impressive staff, the Milberg lawyers employed a physician and medical researcher to contact treating doctors and determine their practices for prescribing a Forest Laboratories product for a particular type of Alzheimer’s disease. “In order to obtain the cooperation of the physicians, [the retained Milberg employee] falsely represented that he was conducting a medical research study.” The treating physicians “were induced to provide patient medical charts and other confidential medical information.” The Milberg lawyers then used the information derived from this scheme as factual averments in its second amended complaint in order to meet the pleading requirements for specificity contained in Rule 9(b) (pleading fraud).

Assuming their competence, Judge Saylor concluded that the Milberg lawyers knew that “physicians are generally prohibited from disclosing patient information to members of the general public.” He found that “[t]he scheme here was highly intrusive; in fact, it was intended to intrude into one of the most sensitive and private spheres of human conduct, the physician-patient relationship.” And to cap it off, “the Milberg attorneys not only caused physicians to disclose patient information, they then published that information in the Second Amended Complaint.” The court’s decision said: “Under the circumstances, the Court has little difficulty concluding that the conduct of the attorneys in this case violated Rules 4.1(a) and 8.4(c) of the Massachusetts Rules of Professional Conduct, and therefore violated Local Rule 83.6.1 of the United States District Court.”

Rule 4.1 (a) provides that “[i]n the course of representing a client a lawyer shall not knowingly … make a false statement of material fact or law to a third person.” The Comment to the Rule states that “[a] lawyer is required to be truthful when dealing with others on a client’s behalf … . Misrepresentations can also occur by partially true but misleading statements or omissions that are the equivalent of affirmative false statements.”

Rule 8.4 (c) deems as “professional misconduct” engaging in “dishonesty, fraud, deceit, or misrepresentation.” So for Judge Saylor, the determination of professional misconduct was not a close call. The self-described world class law firm dripping with money and power employed bad actors, liars, cheaters and defrauders. Their lawyers on the Leysock case were legal grifters, taking advantage of others all in pursuit of fee income. According to a Law360 report on the oral argument, Forest Laboratories lawyer described the Milberg litigation tactics as “egregious,” “shameful,” “absurd,” “deceitful,” “unethical,” “inappropriate,” “unseemly” and “dirty.” B. Amaral, Forest Blasts Attys’ ‘Shameful’ Conduct In FCA Suit, Law360, Boston (December 6, 2016, 6:35 PM EST).

It remains to be seen what will happen to these lawyers. Will they lose their right to practice in the United States District Court for the District of Massachusetts? Will the Court’s findings be transmitted to the states where they hold plenary licenses to practice law? Will they be suspended of disbarred? Their conduct is indefensible in my view. I would not want to be in their shoes. 

Richard P. Campbell is a fellow of the American College of Trial Lawyers and a past president of the Massachusetts Bar Association. He founded Campbell Campbell Edwards & Conroy, P.C., a firm with a national practice, in 1983.