To The Readers Of The Metropolitan Corporate Counsel :
Few people know that NYCLA was the first bar association in America to establish a Committee on Professional Ethics that issued "formal written opinions" to serve as guidance to the bar. Under the leadership of Charles A. Boston, NYCLA issued its first ethics opinion in 1912. A cynic might speculate that Mr. Boston was some "goodie two shoes" who tried to smother others with the same cloak of self righteousness that he used to mask his own inevitable human foibles. Nothing can be further from the truth.
From the day of NYCLA's founding until his death in 1935, Boston was what his contemporaries called a "lion of the bar." Boston himself was president of the American Bar Association and, after that, president of the County Lawyers (1932-1934). While he was ABA president, he called for the repeal of prohibition. That position sparked the condemnation of the Women's Christian Temperance Union (W.C.T.U.) and the wrath of that group should dispel any notion that he was some stuffy prig with an unrealistic moral agenda. Boston's interest in professional ethics was intense but never oblivious to the pressures of practice or the realities of life.
Reading ethics opinions issued over the last 50 years by bar groups across the country reveals what the bar's ethical "hot topics" were from time to time. Since 2002, one "hot topic" has been the lawyer's role in corporate governance; however, for some reason, there is a dearth of formal bar opinions regarding lawyers' responsibilities in this practice environment. This seems even more troublesome now because revelations of another spate of "ethical lapses" are unfolding with weekly media reports of Silicon Valley's "pretexting scandals" and the far too many "backdated options" practices.
These ethical lapses are not merely matters of federal concern or SEC enforcement. In New York, these problems are closely intertwined with our ethical rules governing law firms. The reader may ask, "So what do the 'law firm' disciplinary rules have to do with backdated stock options or some in-house lawyer's stepping over the line while getting the 'dirt' on an intra-corporate-ego-contest participant?" The short answer: "Everything."
Our Code of Professional Responsibility contains a broad definition of "law firm" that includes not only traditional law firms but also corporate law departments and government agencies. Moreover, New York and New Jersey do something that other states do not: they impose responsibility on a "law firm" to assure adherence to ethical standards by lawyers in the firm. These rules appear in DR 1-104 of New York's Code of Professional Responsibility.
To be sure, the overwhelming majority of corporate legal departments take these responsibilities seriously and have extensive guidelines, protocols and procedures for complying with the SEC's Part 205 Rules issued under Sarbanes Oxley. Unsurprisingly, the self-governance systems that satisfy the SEC also partially satisfy the Code of Professional Responsibility's duties imposed on in-house legal departments. Yet, not all non-public companies pay similar attention to these demands. Of course, the Code's disciplinary rules cover a variety of matters not encompassed within the SEC's Part 205 rules. A good example is the Code's prohibitions against communicating with unrepresented parties or threatening criminal prosecution - topics to which the SEC's rules are quite indifferent.
Traditional law firms have protocols that appropriately vary based on the firm's size and client mix. Several "official" comments to these disciplinary rules offer practical guidance. For example, one comment says that in a "small firm of experienced lawyers," informal supervision and periodic review will ordinarily suffice. Yet, in a "large firm, or in practice situations in which difficult ethical problems frequently arise," somewhat more elaborate measures are necessary. The comment goes on to strongly suggest that firms adopt procedures for junior lawyers to make confidential referrals of ethical problems directly to a designated senior partner or special committee. Poignantly, the comments warn that "lawyers with management responsibility may not assume that all lawyers associated with the firm" will follow the rules.
These disciplinary rules provide a powerful incentive for law firms and corporate law departments to encourage professional development through ethical awareness and mentoring. One of the best ways that lawyers' professional development can be fostered is to encourage them to join a bar association where they can learn not only what the rules are but why they are important. As the "inventor" of the bar's formal ethics opinion, the New York County Lawyers' Association offers any lawyer - new or seasoned - the opportunity to hone the sort of ethical awareness that animated Mr. Boston nearly a century ago. His portrait hangs in our Auditorium and we still celebrate his legacy to the bar's collegiality and integrity. That same collegiality now allows us to raise a toast to his other contribution to the bar - independence from the wrath of the W.C.T.U.
Edwin David Robertson