OPINION 2005-12
(August 2005)
The inquirer practices at a small firm that primarily defends workers’compensation cases. The inquirer’s firm previously handled workers’compensation claims for Company A, but has not represented Company A in any matter since October 2003.1 Company A was self-insured and outsourced its claims handling operations to an outside adjustor during the period in which the inquirer’s law firm represented Company A.2 Company A merged with Company B sometime after October 2003. Recently, the inquirer’s law firm was retained by a Company B employee (“Employee”) to represent Employee in a workers’ compensation case. The inquirer’s law firm was not involved in any matter relating to Employee’s injury.

Opposing counsel is arguing that these facts result in a conflict of interest because the inquirer: (a) knows the claims adjuster; (b) knows the Company; (c) knows the local individuals who would be called to testify; (d) is completely familiar with the claims handling practice of merged company; and (e) is intimately familiar with how the merged company maintains its files, investigations, and log notes.

The inquirer advises that: (a) the adjustor is not an employee of Company A or Company B; (b) the inquirer is not familiar with the merged company; (c) the inquirer has no idea who would be called to testify; (d) the inquirer has no knowledge of how claims are processed by the merged company; and (e) the inquirer knows nothing of the merged company’s operations.
The Committee has been asked to opine on whether there is a conflict of interest resulting from the former representation of Company A by the inquirer’s law firm which would preclude the inquirer from currently representing the Employee in his workers’ compensation claim against Company B. This opinion is limited to the specific question presented and the scope of the Pennsylvania Rules of Professional Conduct.
Pennsylvania Rule of Professional Conduct (the “Rules”) 1.9 (Duties to Former Clients) provides that

(a) A lawyer who has formerly represented a client in a matter shall not thereafter represent another person in the same or a substantially related matter in which that person’s interests are materially adverse to the interests of the former client unless the former client gives informed consent.
(b) A lawyer shall not knowingly represent a person in the same or substantially related matter in which a firm with which the lawyer formerly was associated had previously represented a client

(1) whose interests are materially adverse to that person; and

(2) about whom the lawyer had acquired information protected by Rules 1.6 and 1.9(c) that is material to the matter, unless the former client gives informed consent.
(c) A lawyer who has formerly represented a client in a matter or whose present or former firm has formerly represented a client in a matter shall not thereafter:

(1) use information relating to the representation to the disadvantage of the former client except as these Rules would permit or require with respect to a client, or when the information has become generally known; or
(2) reveal information relating to the representation except as these Rules would permit or require with respect to a client.
The relevant Comments to Rule 1.9 provide as follows:
[2] The scope of a “matter” for purposes of this Rule depends on the facts of a particular situation or transaction. The lawyer’s involvement in a matter can also be a question of degree. When a lawyer has been directly involved in a specific transaction, subsequent representation of other clients with materially adverse interests in that transaction clearly is prohibited. On the other hand, a lawyer who recurrently handled a type of problem for a former client is not precluded from later representing another client in a factually distinct problem of that type even though the subsequent representation involves a position adverse to the prior client. . . . The underlying question is whether the lawyer was so involved in the matter that the subsequent representation can be justly regarded as a changing of sides in the matter in question.
[3] Matters are “substantially related” for purposes of this Rule if they involve the same transaction or legal dispute or if there otherwise is a substantial risk that confidential factual information as would normally have been obtained in the prior representation would materially advance the client’s position in the subsequent matter.
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In the case of an organizational client, general knowledge of the client’s policies and practices ordinarily will not preclude a subsequent representation; on the other hand, knowledge of specific facts gained in a prior representation that are relevant to the matter in question ordinarily will preclude such a representation. A former client is not required to reveal confidential information learned by the lawyer in order to establish a substantial risk that the lawyer has confidential information that could be used adversely to the former client’s interests in the subsequent matter. A conclusion about the possession of such information may be based on the nature of the services the lawyer provided the former client and information that would in ordinary practice be learned by a lawyer providing such services. (emphasis added).
Rule 1.10 (Imputation of Conflicts of Interest: General Rule) provides in part that:
(a) While lawyers are associated in a firm, none of them shall knowingly represent a client when any one of them practicing alone would be prohibited from doing so by Rules 1.7, or 1.9, unless the prohibition is based on a personal interest of the prohibited lawyer and does not present a significant risk of materially limiting the representation of the client by the remaining lawyers in the firm, or unless permitted by Rules 1.10(b) or (c).

The inquirer’s law firm does not represent the product of merged Company A and Company B. Therefore, Rule 1.9 (Duties to Former Clients) guides this inquiry and analysis. Rule 1.9 precludes a lawyer from representing a client in a matter that is the same as or substantially related to the lawyer’s representation of a former client where the interests of the client and former client are materially adverse, unless the former client provides informed consent. See Rule 1.9(a). Similarly, Rule 1.10(a) operates to preclude a lawyer from this type of representation where the lawyer’s firm, but not the lawyer, represented the former client, unless the former client provides informed consent. See Rule 1.10a. Rule 1.9(b) also prohibits a lawyer under these circumstances from using or revealing information to disadvantage the former client, except where the Rules permit or where the information has become generally known.
Turning to the specific facts of this inquiry, there nothing to suggest that the law firm’s former representation of Company A and current representation of Employee are “substantially related” as defined under Comment [3] to Rule 1.9. The inquirer informs us that the law firm was not involved in any matter relating to Employee’s injury. To the extent that the inquirer’s law firm possesses general knowledge of Company A’s policies and practices based on its prior representation, this type of knowledge does not ordinarily preclude a subsequent representation. See id. The inquirer’s law firm would have to have knowledge of specific facts gained in its prior representation of Company A that are relevant to the matter in question and that could be used to the disadvantage of Company A, in order be precluded from this representation. Since Company A’s claims operations were outsourced during her firm’s representation of Company A, it is possible that neither the inquirer nor her firm would have ever possessed intimate knowledge of Company A’s operations.3 Even if the inquirer or her law firm possessed such information, it is uncertain how the information could be used to disadvantage Company A in a wholly separate matter that is unrelated to claims operations. Based on the facts presented, the Committee concludes that no conflict exists because the matters are not “substantially related” as contemplated by Rule 1.9, and because any general knowledge possessed by the law firm pertaining to Company A’s practices would not trigger a conflict in the absence of specific and detrimental information relevant to the current case.
CAVEAT: The foregoing opinion is advisory only and is based upon the facts set forth above. The opinion is not binding upon the Disciplinary Board of the Supreme Court of Pennsylvania or any other Court. It carries only such weight as an appropriate reviewing authority may choose to give it.

1 The record does not reflect whether the inquirer was personally involved in the law firm’s representation of Company A. However Rule 1.10a (“Imputed Disqualification”), if applicable, would operate to disqualify him even if she did not.
2 This fact is relevant to the extent that it supports Inquirer’s position that the firm possessed only general knowledge of Company A’s operations at the time of its representation and even its general knowledge was limited.
3 Even if the inquirer’s law firm possesses knowledge of Company A’s prior claims processes, it is possible that the merger of Company A and Company B resulted in a claims process entirely distinct from that which was in place at the time of the representation.

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