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                                         132 N.J.L.J. 573
                                        November 2, 1992

                                        1 N.J.L. 1705
                                        November 2, 1992


Appointed by the New Jersey Supreme Court


Ex Parte Communication with Former
Employees of Corporate Defendants

    We are asked whether a lawyer may ethically conduct ex parte interviews of former employees of corporations that are adverse parties in litigation and what limitations, if any, are imposed upon such interviews by the Rules of Professional Conduct. The applicable Rules are:

     RPC 4.2 Communication with Person Represented by Counsel

        In representing a client, a lawyer shall not communicate about the subject of the representation with a party the lawyer knows to be represented by another lawyer in the matter, unless the lawyer has the consent of the other lawyer or is authorized by law to do so.

    RPC 4.3 Dealing with Unrepresented Person

        In dealing on behalf of a client with a person who is not represented by counsel, a lawyer shall not state or imply that the lawyer is disinterested. When the lawyer knows or reasonably should know that the unrepresented person misunderstands the lawyer's role in the matter, the lawyer shall make reasonable efforts to correct the misunderstanding.
    The inquiry may well have been prompted by uncertainty generated by the holding of the Appellate Division in State v. CIBA-GEIGY Corp., 247 N.J. Super 314 (1991) which dealt with ex parte interviews of current employees of a corporate litigant. Although it appears that the Supreme Court granted a motion for leave to appeal from that decision, we are advised that the matter was thereafter dismissed.
    A careful review of the Appellate Division decision leads us to conclude that its rationale applies with equal force to the conduct of ex parte interviews of former employees of a corporate litigant.
    Indeed, in its analysis of the scope of protection afforded by RPC 4.2, the Court rejected the polar extremes - the "plain language" construction which would limit the definition of the word "party" to the corporate entity named in the pleadings and its antithesis - the view which would prohibit all ex parte interviews including those of former employees, as enunciated by Judge Politan in Public Service Electric and Gas Co. v. Associated Electric & Gas Ins. Services, Ltd., 745 F.Supp. 1037, 1039-42 (D.N.J. 1990).
    Having rejected the "bright line" views, the Appellate Division expressly adopted the position taken by the New York Court of Appeals in Niesig v. Team I, 76 N.Y. 2d 363, 559 N.Y.S. 2d 493, 496, n.3, 558 N.E. 2d 1030, 1033, n.3 (1990) quoting therefrom in haec verba:
    The single indisputable advantage of a blanket preclusion - as with every absolute rule - is that it is clear. No lawyer need ever risk disqualification or discipline because of uncertainty as to which employees are covered by the rule and which not. The problem, however, is that

    a ban of this nature exacts a high price in terms of other values, and is unnecessary to achieve the objectives of DR 7-104(A)(1) [the predecessor to RPC 4.2 which contains substantially the same language]. [559 N.Y.S. 2d at 497, 558 N.E. 2d at 496]

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    The test that best balances the competing interests, and incorporates the most desirable elements of the other approaches, is one that defines 'party' to include corporate employees whose acts or omissions in the matter under inquiry are binding on the corporation (in effect, the corporation's 'alter egos') or imputed to the corporation for purposes of its liability, or employees implementing the advice of counsel. All other employees may be interviewed informally.
        Unlike a blanket ban or a 'control group' test, this solution is specifically targeted at the problem addressed by DR 7-104(A)(1). The potential unfair advantage of extracting concessions and admissions from those who will bind the corporation is negated when employees with 'speaking authority' for the corporation, and employees who are so closely identified with the interests of the corporate party as to be indistinguishable from it, are deemed 'parties' for purposes of DR 7-104(A)(1). Concern for the protection of the attorney-client privilege prompts us also to include in the definition of 'party' the corporate employees responsible for actually effectuating the advice of counsel in the matter. [Id. at 498, 558 N.E. 2d at 1035].

    Immediately following the foregoing excerpts from Niesig v.

Team I the Appellate Division said:
    We are not the Supreme Court which can amend or clarify its rule, and we fully recognize that the broader we define the word "party" the more we narrow pretrial discovery of facts. [n.9]. However, we know no better way than the New York Court of Appeals to balance the purpose of the Rule with the realities and practicalities of conducting litigation. That balance may at first, as in New York, be somewhat difficult to apply. It may even deter some ex parte civil discovery, there is no great social or policy sacrifice; it will promote other types of discovery, such as by deposition upon notice to the adversary.

    n.9 Our Rules have express provisions relating to depositions of corporations through designated officers, directors or managing agents. See R. 4:14-2(c); R. 4:16- 1(b). [State v. CIBA-GEIGY Corp., supra, 247 N.J. Super at 325.
    Now, all of this is strictly subject to the risk of possible intrusion upon privileged matters, the caveat expressed in the last sentence in the quotation from Niesig v. Team I, supra, 76 N.Y. 2d 363, 559 N.Y.S. 2d 493. The right to conduct ex parte interviews of former employees is not a license to penetrate privileges. See Stempler v. Speidell 100 N.J. 368 (1985) laying down conditions upon which a treating physician may be interviewed (instead of being deposed).
    In AAMCO Transmissions, Inc. v. Michael A. Marion, 1991 U.S. Dist. LEXIS 13326 (E.D. Pa. 1991) the Court rejected a claim of an RPC 4.2 violation, noting that there had been no showing as to how counsel could have known that the person contacted would possess information subject to the attorney-client privilege. Id. at 6. In footnote 2, the Court observed: "Plaintiffs rely upon Oak Industries v. Zenith Industries, 1988 WL 79614 (N.D. Ill. 1988). In that case, the ex parte contacts at issue were with Plaintiffs' former general counsel, an individual who clearly could be expected to possess information subject to the attorney-client privilege."
    In short, ex parte interviews of current or former corporate employees involve potential hazards which can often be avoided by agreement with counsel for the corporate party.See footnote 1 1 The risks are serious.
    The need for RPC 4.2's protection to extend to individuals having access to litigation confidences was noted in the case of Amarin Plastics, Inc. v. Maryland Cup Corp., 116 F.R.D. 36, 40 (D. Mass. 1987), where the Court, discussing another case, said:
    Moreover, the court stressed that even if the employee had been considered a former employee, DR 7-104 would still apply because he was a "former confidential employee, a confidential consultant and a member of MGM's litigating team for this case." Id. Once the employee had resigned as vice president, he signed a consulting agreement that required him to assist in the litigation; he continued to work with the lawyers in preparation for litigation; and was privy to confidential information regarding the litigation. His consulting duties included such sensitive tasks as helping to draft interrogatories and assisting counsel at depositions, and in fact he was listed as an expert witness for the opposing party. (citation omitted) (emphasis added).

See also ABA Committee on Professional Ethics and Grievances Formal Opinion 47 (decided under the Canons of Ethics) (attorney ought to be disqualified where he learned the substance of privileged communications concerning the matter through an informal interview) and Cf. Gray v. Commercial Union Ins. Co., 191 N.J. Super 590 (App. Div. 1983) mere access to confidential communications leads to an irrebuttable conclusion that such secrets had been obtained, and must result in disqualification of counsel).
    Prophylaxis is always sound policy where the unrepresented former employee is to be interviewed ex parte, and this is the theme of RPC 4.3. We have noted the safeguards prescribed by the Supreme Court in Stempler, supra, 100 N.J. 368, and other Courts have been equally circumspect. In Morrison v. Brandeis University, 125 F.R.D. 14 (D. Mass. 1989) the Court granted a motion for leave to interview present and former employees of the defendant but prescribed the following guidelines:
    1.    When plaintiff's counsel initially contacts any person as to which authorization to interview has herein been given (hereinafter, "any person"), she shall immediately disclose her capacity as counsel for the plaintiff in the above-styled litigation and the purpose of the contact, i.e. to request and interview.

    2.    Whether or not to grant the request for an interview is completely up to the person, and the person's decision shall be respected.

    3.     Any request by any person that the interview take place only in the presence of his or personal attorney and/or the presence of Brandeis' attorney shall be honored.

    4.    Brandeis shall advise all persons within the group which plaintiff's counsel has herein been given authorization to interview that they may, if they wish, agree to be interviewed by plaintiff's counsel to discuss matters which relate to this case and that disciplinary or other adverse action will not be taken by Brandeis against any person who consents to an interview.
    Finally, ABA Formal Opinion 91-359 (1991) dealt with the precise subject matter and reached essentially the same conclusions. In summary, ex parte interviews of former employees of a litigant are not per se improper under the Rules of Professional Conduct, but one sails rather close to the wind in undertaking such measures. The risks ought to be weighed carefully before doing so.
    Given the impracticality of fashioning a "bright line," these situations do not lend themselves to empirical resolution. Obvious questions are presented in every case. Is (or was) the former employee part of the corporate "litigation team" involved in the litigation? Was he or she privy to confidential communications? How long ago did employment cease? Is there any possibility that the former employee may become a party? How can the lawyer prove compliance with RPC 4.3? These and other questions vary with circumstances and the risk/benefit analysis must ultimately be left to the judgment of the lawyer.

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Footnote: 1 1 And always avoided by deposition.

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