{"id":198475,"date":"2025-04-22T10:41:21","date_gmt":"2025-04-22T10:41:21","guid":{"rendered":"https:\/\/peraltafinancing.com\/business\/legal\/conflicts-risk-insightful-analysis-of-executive-pro-bono-arrangements-in-terms-of-conflicts\/"},"modified":"2025-04-22T10:41:21","modified_gmt":"2025-04-22T10:41:21","slug":"conflicts-risk-insightful-analysis-of-executive-pro-bono-arrangements-in-terms-of-conflicts","status":"publish","type":"post","link":"https:\/\/fivemor.com\/?p=198475","title":{"rendered":"Conflicts Risk \u2014 Insightful Analysis of Executive Pro Bono Arrangements in Terms of Conflicts"},"content":{"rendered":"<p> <br \/>\n<\/p>\n<div id=\"post-8963\">\n<p>\t<!-- .entry-header --><\/p>\n<div class=\"entry-content\">\n<p><img fetchpriority=\"high\" decoding=\"async\" class=\"aligncenter size-full wp-image-8826\" src=\"https:\/\/bresslerriskblog.com\/wp_bresslerriskblog\/wp-content\/uploads\/2025\/03\/2025_whitehouse.jpg\" alt=\"\" width=\"480\" height=\"273\" srcset=\"https:\/\/bresslerriskblog.com\/wp_bresslerriskblog\/wp-content\/uploads\/2025\/03\/2025_whitehouse.jpg 480w, https:\/\/bresslerriskblog.com\/wp_bresslerriskblog\/wp-content\/uploads\/2025\/03\/2025_whitehouse-230x131.jpg 230w, https:\/\/bresslerriskblog.com\/wp_bresslerriskblog\/wp-content\/uploads\/2025\/03\/2025_whitehouse-350x199.jpg 350w\" sizes=\"(max-width: 480px) 100vw, 480px\"\/><\/p>\n<p>Brad Wendel, professor at Cornell Law School, puslihed:\u201d<a href=\"https:\/\/bradwendel.substack.com\/p\/conflicts-for-quislings\"><strong>Conflicts for Quislings<\/strong><\/a>\u201d \u2014<\/p>\n<ul>\n<li>\u201cThe firms that have caved rather than challenge the egregiously unconstitutional executive orders issued by the Trump Administration have all agreed to provide tens of millions of dollars of pro bono assistance.\u201d<\/li>\n<li>\u201cTrump has recently suggested that he will use the firms\u2019 pro bono services to help negotiate trade deals with countries subject to his tariffs. in a Truth Social post he described \u2018build[ing] an unrivaled network of Lawyers, who will put a stop to Partisan Lawfare in American, and retore Liberty and Justice FOR ALL.\u2019 He announced at a Cabinet meeting:\u201d\n<ul>\n<li>\u2018We have a lot of law firms that have paid me a lot of money in the form of legal fees. We\u2019re going to probably use those firms \u2026 if we can \u2013 I think we can,\u2019 Trump said during a meeting of his cabinet at the White House. \u2018I think we\u2019re going to try to use these very prestigious firms to help us out with the trade.\u2019<\/li>\n<\/ul>\n<\/li>\n<li>\u201cHow the Deals with Trump Create Conflicts of Interest. To set the stage, consider a recent event that may seem unrelated to law firm conflicts but is actually the heart of the matter (h\/t Serious Trouble).\u201d<\/li>\n<li>\u201cA couple of weeks ago, Adam Schleifer, an Assistant United States Attorney in Los Angeles, was notified that he had been terminated at the instructions of Donald Trump. The L.A. Times reported that the termination came via a one-line email from a White House staff account. Needless to say, this is very much not the way terminations of federal prosecutors are normally handled. AUSA\u2019s have civil service protection, and ordinarily any disciplinary action against them would go through chain of command in the Justice Department.\u201d<\/li>\n<li>\u201cSo what happened? Schleifer was in charge of the prosecution of fast food executive Andrew Wiederhorn on federal tax-evasion charges, arising out of allegations that he had used corporate funds as a piggy bank to fund his personal expenses, including private jet travel, fancy vacations, and a Rolls-Royce. The L.A. Times reports that his defense team had \u2018aggressively pushed Justice Department officials to drop the case.\u2019 Reading between the lines, it is a plausible inference that Wiederhorn was a buddy of Trump, a donor to his campaign, or personally or financially close to a Trump supporter. Here\u2019s the bottom line from the point of view of independence of the legal profession and the rule of law:\u201d\n<ul>\n<li>\u2018[A] former prosecutor who handled fraud cases in the U.S. attorney\u2019s office and sought anonymity over concerns about facing professional backlash, said he believes Schleifer\u2019s firing is \u2018going to have an incredible chilling effect on any line federal prosecutor who is thinking about criminally investigating or prosecuting an executive of any company of any significance.\u2019<\/li>\n<li>\u2018The message from Adam\u2019s case is that if you\u2019re going to indict some run-of-the-mill CEO of a company, you need to check if he\u2019s a Trump supporter first,\u2019 the former prosecutor said. \u2018It\u2019s going to cause line prosecutors to be considerably more careful about pursuing anyone who has even tenuous connections to the president, which is not good for the DOJ.\u2019<\/li>\n<\/ul>\n<\/li>\n<li>\u201cIn a Substack post, a partner at Jenner &amp; Block, which is one of the firms suing over the unconstitutional EOs, explained why becoming part of Trump\u2019s \u2018unrivaled network of Lawyers\u2019 can create conflicts of interest for the firms:\u201d\n<ul>\n<li>\u2018[I]f a law firm enters into this type of non-deal, I don\u2019t understand how it can ever represent clients in any case that involves the government. Every time its lawyers file a brief, they will think: \u2018On the one hand, I have to represent my client zealously, but on the other hand, I have to make sure not to undo the deal.\u2019<\/li>\n<li>\u2018The firm might pretend it is defending its clients zealously. It might file legal briefs making all manner of legal arguments. But what if a lawyer uncovered information that made the government look bad? There would be massive pressure on the lawyer to look the other way. Maybe the lawyer would try to offer some explanation to his client as to why it\u2019s strategically best to set the issue aside. But there would always be a question mark in the client\u2019s head: \u2018is my lawyer saying this because he believes it, or is the lawyer saying this because he\u2019s trying to preserve his law firm\u2019s settlement with the government?\u2019<\/li>\n<\/ul>\n<\/li>\n<li>\u201cI think this is exactly right. However, the example of Adam Schleifer shows that the concern does not arise only in litigation against the government. A firm may also have to be careful not to anger an ally of Trump or one of his associates like Elon Musk or a contributor to Trump\u2019s campaign or someone with whom he is in a financial relationship (like a shady cryptocurrency promoter). Doing so could lead to professional consequences like being fired as an AUSA or, in the case of a law firm, being deemed out of compliance with the terms of an agreement with the administration.\u201d<\/li>\n<li>\u201cBut it\u2019s even worse. Firms may have to worry not only about representing clients in litigation in ways that potentially make Trump or his supporters look bad. They also have to worry about transactional representation, like merger deals, in which government approval is a condition of the transaction closing.\u201d<\/li>\n<li>\u201cImagine a big law firm that is working on a lot of transactional work for a number of clients across a wide range of regulated industries. Some of the matters may be M&amp;A transactions, or they could be routine deals that require federal agency approvals, permits, licenses, or whatever. The CBS\/Paramount\/Skydance deal shows that this administration has no compunction at all about threatening to withhold agency approval if one of the parties does not fall into line with what Karoline Leavitt referred to as the \u2018America first agenda.\u2019 Client A needs approval from the FTC, FCC, or some other agency so that a merger can go through. Client B is litigating against a different government agency or even just a company controlled by a guy who gets Trump\u2019s ear at Mar-a-Lago. The word comes down that Client A\u2019s approval won\u2019t come through unless Client B drops the case. That\u2019s a really nasty conflict of interest, and it is entirely foreseeable given this administration\u2019s personalized, friends-or-enemies approach to thinking about government interests.\u201d<\/li>\n<li>\u201cIf you have any doubt that \u2018America first agenda\u2019 is just another way of referring to the full MAGA project, look at the EO that was entered against Susman Godfrey (which the firm, to no one\u2019s surprise, is fighting). The EO claims that the firm is acting in a way that is \u2018detrimental to critical American interests\u2019 because \u2018Susman spearheads efforts to weaponize the American legal system and degrade the quality of American elections.\u2019 What was that effort that weaponized the American legal system and degraded the quality of American elections? Maybe delivering a good old-fashioned ass-kicking to Fox News in a defamation action brought by Dominion Voting Systems? Fox, of course, had eagerly promoted the false narrative pushed by Trump of widespread fraud in the 2020 presidential election. Any deviation from that narrative must be severely punished as anti-American. Do you think any law firm that has cut a deal with Trump, with the proverbial sword of Damocles of these EOs, could possibly represent a client like Dominion in a matter that might arose Trump\u2019s ire?\u201d<br \/>A Brief Brush-Up on Conflicts of Interest\u201d<\/li>\n<li>\u201cThis is a liability and risk-management concern for these firms, not merely a matter of client relations or a so-called \u2018business conflict.\u2019 Every U.S. jurisdiction has a conflict of interest rule based on ABA Model Rule 1.7. Some states employ varying language, like New York\u2019s \u2018differing interests\u2019 standard, but the substantive standard is the same. Here\u2019s Model Rule 1.7(a)(2):\u201d\n<ul>\n<li>\u2018A concurrent conflict of interest exists if . . . there is a significant risk that the representation of one or more clients will be materially limited by the lawyer\u2019s responsibilities to another client, a former client or a third person or by a personal interest of the lawyer.\u2019<\/li>\n<\/ul>\n<\/li>\n<li>\u201cThe conflicts of one lawyer in the firm are imputed to all lawyers in the firm, under Rule 1.10(a), so if the firm is part of Trump\u2019s network of lawyers, a lawyer doing administration-approved pro bono work has responsibilities to that client that may materially limit the representation of other firm clients, even if represented by a completely different team of lawyers, even in a different office of the firm.\u201d<br \/>\u201cThe key to understanding material-limitation conflicts is the concept of independent professional judgment. A lawyer must always be free to advise a client on a course of action, or take measures in the course of representing the client, that are based solely on the lawyer\u2019s reasonable assessment of what is in the client\u2019s best interests. This is an implication of the highly fiduciary duty of loyalty that characterizes the lawyer-client relationship. Comment [8] to Rule 1.7 explains:\u201d\n<ul>\n<li>\u2018[A] conflict of interest exists if there is a significant risk that a lawyer\u2019s ability to consider, recommend or carry out an appropriate course of action for the client will be materially limited as a result of the lawyer\u2019s other responsibilities or interests. . . . The conflict in effect forecloses alternatives that would otherwise be available to the client. The mere possibility of subsequent harm does not itself require disclosure and consent. The critical questions are the likelihood that a difference in interests will eventuate and, if it does, whether it will materially interfere with the lawyer\u2019s independent professional judgment in considering alternatives or foreclose courses of action that reasonably should be pursued on behalf of the client.\u2019<\/li>\n<\/ul>\n<\/li>\n<li>\u201cSomething lawyers sometimes forget is that a conflict of interest exists, by definition, if there is a significant risk of this type of interference with independent professional judgment.\u201d<\/li>\n<li><strong>\u201cSo, to all you conflicts partners at the firms who have entered into deals with the White House . . . are you ready for this? Have you looked at all of your firm\u2019s litigated matters to see if any of the adverse parties are buddies with Trump? Or whether they represent interests that are more aligned with the \u2018America first agenda\u2019 than your clients? Have you reviewed pending transactional matters to see if agency approval is required to serve the interests of Client A? If so, have you thought about whether something Client B has done may have pissed off Trump? Have you considered the concessions that will be demanded from Client B in order to keep the matter for Client A running smoothly?\u201d<\/strong><\/li>\n<li>\u201cMost conflicts are waivable, provided that all affected parties give informed consent, which is defined by Model Rule 1.0(e) as \u2018the agreement by a person to a proposed course of conduct after the lawyer has communicated adequate information and explanation about the material risks of and reasonably available alternatives to the proposed course of conduct.\u2019 But that \u2018adequate information and explanation\u2019 standard is very demanding in practice. In order to get Client A\u2019s informed consent to the representation, in light of the risk that Trump may be pissed off by something you did in the course of representing Client B, you need to provide full disclosure. And that may require revealing information pertaining to Client B that you are duty-bound to keep confidential. (One of my favorite teaching cases on conflicts involves incompatible duties of communication and confidentiality.) While these firms so far are being tight-lipped about the terms of their agreements with the administration, it won\u2019t be long before clients will start demanding to see them, and for good reason. If a firm cannot reveal information of one firm client to another, then the conflict becomes practically non-waivable, even if it might have been theoretically waivable. In that case, proceeding in the face of the un-waived conflict will be a breach of duty to all affected clients.\u201d<\/li>\n<li>\u201cThen there\u2019s the more general, less client-specific risk associated with the provision of the firm\u2019s promised $40-125 million worth of legal services to the administration, in negotiating coal mining leases or whatever. In normal circumstances a firm would be able to say no to a client\u2019s request to provide legal services in connection with a matter. A firm subject to one of these agreements, however, might reasonably believe it has no option to decline to provide some work in furtherance of the \u2018America first agenda.\u2019 The firm may also not be permitted to exercise its usual independent judgment in deciding what other pro bono matters to take. It\u2019s not at all farfetched to think that somewhere in White House counsel\u2019s office there are some lawyers tasked with monitoring these firms work toward their commitment of providing free legal services to the administration. If lawyers have always hated oversight by liability insurers, wait until they experience the supervision of political commissars who will be looking for evidence of ideological non-conformity. I believe some of the lawyers in these firms think they will be able to continue to run their pro bono programs in the way they have always done so, but again taking Trump literally as well as seriously, I expect they\u2019re going to find out that he really does think of them as \u2018his\u2019 law firms, to be ordered around and punished severely for non-compliance.\u201d<\/li>\n<li>\u201cGetting this wrong risks not only professional discipline but lawsuits from affected clients for negligence or breach of fiduciary duty. This is bread-and-butter work for those of us who do expert witness work in the professional responsibility area. Big-firm conflicts checking procedures are sophisticated, but it can be extremely difficult to pick up material limitation conflicts, given the many ways in which, per Comment [8], the \u2018lawyer\u2019s ability to consider, recommend or carry out an appropriate course of action for the client will be materially limited as a result of the lawyer\u2019s other responsibilities or interests.\u2019 The assessment of material limitation is not just something that happens at the outset of the representation but must be reevaluated over the course of the representation as positions and interests potentially re-align. A job that has always been extremely difficult just became much more so.\u201d<\/li>\n<li>Worth reading his <a href=\"https:\/\/bradwendel.substack.com\/p\/conflicts-for-quislings\"><strong>entire piece<\/strong> <\/a>for even more detail and commentary.<\/li>\n<\/ul><\/div>\n<p><!-- .entry-content --><\/p>\n<p>\t<!-- .entry-footer --><\/p>\n<\/div>\n\n","protected":false},"excerpt":{"rendered":"<p>Brad Wendel, professor at Cornell Law School, puslihed:\u201dConflicts for Quislings\u201d \u2014 \u201cThe firms that have caved rather than challenge the egregiously unconstitutional executive orders issued by the Trump Administration have all agreed to provide tens of millions of dollars of pro bono assistance.\u201d \u201cTrump has recently suggested that he will use the firms\u2019 pro bono [&hellip;]<\/p>\n","protected":false},"author":1,"featured_media":198476,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[97],"tags":[10990,63034,72809,19972,5285,15853,1190,11115,11386],"dealstore":[],"offerexpiration":[],"class_list":["post-198475","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-legal","tag-analysis","tag-arrangements","tag-bono","tag-conflicts","tag-executive","tag-insightful","tag-pro","tag-risk","tag-terms"],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v26.4 - 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