August 2016 | Earn one hour of MCLE Credit in Legal Ethics
By Michele K. Trausch
SAMPLE TEST QUESTIONS
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Client A engages Arthur Attorney to help her. Her Former
Counsel not only lost her case but is demanding immediate payment of unpaid
fees. Client A recites examples of misconduct on the part of Former Counsel,
including what would seem to be violations of the Rules of Professional
As a zealous advocate, Arthur Attorney picks up the phone and
calls Former Counsel. He tells Former Counsel to drop his claim for unpaid fees
immediately or Client A will report Former Counsel to the State Bar. Arthur Attorney
confirms his statements in a follow-up letter.
Arthur Attorney’s next appointment is with Client B. The client’s
dispute is with a licensed real estate broker who is demanding payment of a
commission which the client does not think he should have to pay. Arthur Attorney
writes to the broker, stating that unless the broker drops his claim for
payment, the client will "pursue all available legal remedies."
That afternoon, Arthur Attorney sees Client C. Client C has a
dispute with his neighbor that could be addressed by both civil remedies and by
reporting the neighbor to the district attorney. The neighbor is apparently
selling drugs out of her home, causing a nuisance to Client C as well as
violating the law. After consultation, Arthur Attorney advises the client to
file a report with the district attorney and tells the client that he will write
a “cease and desist” letter, which he does, demanding that the neighbor cease
and desist her criminal activities and warning that if she does not, Client C will file a civil complaint against her for creating a nuisance.
It’s been a busy day for Arthur Attorney, but are there any
ethical issues with his conduct and advice? Has Arthur Attorney crossed over
the line with Client A? With Client B? With Client C?
Let’s consult Rule of Professional Conduct 5-100.
“(A) A member shall not threaten to present criminal,
administrative, or disciplinary charges to obtain an advantage in a civil
dispute.” Rule 5-100(A).
A “civil dispute” is defined in the Rule 5-100(C) as
a pending lawsuit in state or federal court; an action pending before an
administrative tribunal; and any controversy or potential controversy, whether or not a formal proceeding has been initiated.
An employer suspected its former employee of soliciting
employees to work for a competitor. The employer’s attorney wrote a letter to
the competitor accusing it of unfair competition and demanding that the
competitor put an end to the former employee’s actions. The attorney’s letter
also implied that he would report the employee’s bad conduct to the employee’s
probation officer. The court held that threatening to present criminal
"charges to obtain an advantage in a civil dispute" was exactly what
Rule 5-100 was intended to prevent. Nguyen v. Proton Technology Corp. (1999)
69 Cal.App.4th 140, 152.
An attorney was retained by a client in a civil matter to write
a demand letter to the other side. No litigation had yet been filed. The
attorney’s letter stated that "unless a prompt and satisfactory settlement
is reached, all available legal remedies will be pursued." Because the
"threat" in this example was not spelled out, it was considered
ambiguous. The threat could have meant that the client would pursue its legal
remedies by filing a civil suit, and since Rule 5-100(A) only prohibits threats
of “criminal, administrative, or disciplinary charges,” there was no violation. California
State Bar Formal Opinion 1991-124.
An attorney was owed his fees. He threatened to report the
client’s wife to immigration authorities if he wasn’t promptly paid. This
constituted a violation of Rule 5-100:
private conference with Alice Shelton Lansing, [attorney] made threats of
action injurious to her and to his client, Ross Lansing, in an attempt to force
through fear the payment of his bill for legal services, and that failing in
this endeavor, his motive was punitive in writing, without justification, to
the immigration authorities in an effort to incite an investigation of a
supposed alien through a misrepresentation of facts.” Lindenbuam v. State
Bar (1945) 26 Cal.2d 565, 573.
An attorney wrote a letter demanding action by opposing
counsel, advised that he would move for monetary sanctions if opposing counsel
did not comply, and also raised the possibility of initiating a criminal contempt
proceeding if no action were forthcoming. Neither statement in the letter
constituted a Rule 5-100 violation because “the Court finds that it contains no
threat; it only mentions that Defendant believed that Plaintiff violated the
law and that Defendant planned to move for sanctions.” Chamberlain v. Les
Schwab Tire Ctr. of California, Inc., 2012 WL 6020103 (2012) at *8 (E.D.
Cal. Dec. 3, 2012); see also Rule 5-100 Discussion (“Rule 5-100 is not
intended to apply to a member’s threatening to initiate contempt proceedings
An attorney threatened an oil company with reporting
adulteration of its gasoline to the district attorney unless it paid his
clients a monetary settlement. This was a violation of the Rule as well as an
attempt to extort money, a violation under the Penal Code. Barton v. State
Bar (1935) 2 Cal.2d 294, 297.
Attorney counseled client to threaten criminal charges in order
to coerce a settlement, knowing that attorney herself was prohibited from
making such a threat. This constituted a violation of Rule 5-100 by
"assisting the client in doing indirectly" what the attorney could
not do directly. State
Bar of California Formal Opinion no. 1983-73; San Diego County Bar
Association Ethics Opinion 2005-1. Note that there would be no violation if the
party, on his or her own, without attorney involvement, made such a threat, as
“members” of the bar.
A prosecutor offered to dismiss a colorable criminal action in
exchange for a release from civil liability against the police department
arising from defendant’s arrest. This was an implied threat to continue
criminal prosecution if the defendant refused to give the release. Even though
not an explicit threat, such action constituted a violation of Rule 5-100. State
Bar of California Formal Opinion 1989-106.
A lawyer threatened to pursue criminal charges against his
client’s ex-husband arising from an altercation, but agreed to drop the
criminal charges if his fees were paid. This was a violation of Rule 5-100. Bluestein
v. State Bar (1974) 13 Cal.3d 162, 170 (the court based its ruling on
Business & Professions Code section 6106, finding that the lawyer’s actions
constituted moral turpitude).
After losing at trial, the lawyer sent a letter to the opposing
party, accusing him of committing perjury and demanding payment to his client,
stating that unless payment was made, the lawyer would file a motion for new
trial and a complaint for perjury. This constituted a violation of Rule 5-100
and further might have exposed the lawyer to criminal liability for extortion. Libarian
v. State Bar (1952) 38 Cal.2d 328, 329-330. Note that merely threatening to
move for a new trial absent action on a settlement would not violate the rule
since the rule prohibits only threats “to present criminal, administrative, or
”not to make motions in pending cases.”
Before filing a complaint in court against a governmental
entity, a claimant must first file a Government Tort Claim. Although this is
essentially a "threat" to file a complaint if the claim is not paid,
it is expressly excluded from Rule 5-100 and does not constitute a violation of
the Rule. Rule 5-100(B) and Rule 5-100 Discussion (“[The rule] exempt[s] the
threat of filing an administrative charge which is a prerequisite to filing a
Application of the litigation privilege
Attorneys faced with claims of a possible Rule 5-100 violation
have argued that their actions are protected by the litigation privilege found
in Civil Code section 47(b). Although this privilege generally protects statements
made during the course of judicial proceedings, there are exceptions to its
application. At least one court has found the privilege inapplicable when the
attorney’s statements were clear violations of Rule 5-100 and, further, were
irrelevant to the dispute. Nguyen v. Proton Technology Corp., supra, at
Other courts have found threatening statements made by
attorneys to constitute extortion, which also takes the threat outside the
litigation privilege. For example, in Flatley v. Mauro (2006) 39 Cal.4th
299, an entertainer sued counsel for a woman who contended she was assaulted. The
attorney threatened to "go public" with a suit and its allegations
unless a substantial payment was made. When Flatley later sued, Mauro, the
lawyer, argued that his statements and threats were protected by the litigation
privilege. However, the court held that "Civil Code section 47 states a
statutory privilege, not a constitutional protection … [T]hat statutory
privilege is specific and limited in nature." Id. at 324.
Mauro’s actions were found to constitute extortion, which is
defined as obtaining property from another, with his consent, induced by a
wrongful use of force or fear. Penal
Code, section 518. Thus, the Flatley court concluded: "Attorneys
are not exempt from these principles in their professional conduct. Indeed, the
Rules of Professional Conduct specifically prohibit attorneys from
’threaten[ing] to present criminal, administration, or disciplinary charges to
obtain an advantage in a civil dispute.’ (Cal. Rules of Prof. Conduct, rule
5-100(A).)" Id. at 327.
There is no hard and fast rule as to when a statement is a
"threat" nor is there a hard and fast rule as to when a threat is
made "to obtain an advantage in a civil dispute." Some of the examples
cited above would seem to be clear violations of Rule 5-100 while others are
more nuanced. Thus the State Bar and the courts will consider complaints of
Rule 5-100 violations on a case-by-case basis, analyzing both the content as
well as the context of the communication. Criminal extortion under the penal
code will often be enough to sustain a finding of a Rule 5-100 violation,
although an alternative finding of a “moral turpitude” violation under Business
& Professions Code section 6106 may result from conduct that cannot be squarely placed within that prohibited by Rule 5-100.
Arthur Attorney’s conduct
We now return to Arthur Attorney’s busy day and the scenarios he encountered.
Arthur’s actions on behalf of Client A, namely threatening
Former Counsel with a State Bar complaint unless Former Counsel dropped his
demand for unpaid fees, comes within the scope of Rule 5-100. Arthur has
threatened administrative or disciplinary charges in order to gain advantage
for his client in a civil fee dispute. This would constitute a violation of the rule.
As to Client B, Arthur has threatened the real estate broker,
telling him to drop his commission claim or B will "pursue all legal
remedies." This statement is vague as to exactly what Arthur and his
client might do. While they could mean that he will report the broker to his
licensing agency and seek administrative or disciplinary action against the
broker, it also might mean he will file a civil action seeking declaratory
relief as to whether the commission was actually due or not. Since the threat
in this scenario was not explicit, it is doubtful that the State Bar would
pursue disciplinary action against Arthur for violation of Rule 5-100.
Lastly, Arthur advised Client C to report his neighbor to the district
attorney for possible criminal prosecution. Advising a client with a legitimate
claim to report it to the appropriate authorities does not come within the
ambit of the rule and there is no violation here.
In writing the letter to the neighbor on behalf of Client C and
demanding that the neighbor cease and desist her drug-selling activities,
Arthur has also avoided violating Rule 5-100. First, he made no threat in his
letter, but merely a demand that the illegal activities stop. Secondly, although
Arthur threatened that C would file a civil complaint for nuisance against the
neighbor, this is not a threat to present “criminal, administrative, or
disciplinary charges to obtain an advantage in a civil dispute.” There has been no violation of Rule 5-100 as to Client C.
In our quests to be vigorous and effective advocates for our
clients, it is easy to "cross over the line" and violate Rule 5-100. Threats
to present criminal, administrative or disciplinary charges in order to obtain
an advantage in a civil dispute, whether the subject of current litigation or
merely anticipated litigation, are violations and can subject an attorney to
disciplinary action by the State Bar. However, actually presenting such charges
are not violations. Filing an administrative, disciplinary or criminal charge,
where appropriate, is perfectly acceptable. Threatening to do so in order to gain an advantage in a civil dispute, is a violation of the rule.
Michele Trausch is a member of the State Bar Committee on Professional Responsibility and Conduct (COPRAC) and recently retired as general counsel of a mid-sized San Francisco law firm. She has written and lectures frequently on ethics and risk management issues. The opinions here are her own.
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