Timothy O'Toole Quoted Regarding Ethical Considerations of Whistleblowing for In-House Counsel in Corporate Counsel Connect

"The Intersection of Whistleblowing, Ethics, and In-House Counsel"
Corporate Counsel Connect

Timothy O'Toole was quoted regarding ethical considerations for in-house counsel with respect to whistleblowing claims. He addresses the history of whistleblowing, ethical responsibilities of lawyers with respect to attorney-client privilege, and the narrow exceptions when corporate counsel may be able to blow the whistle. "Although the whistleblowing guidelines do not categorically exclude lawyers, as a practical matter they are almost always ineligible for these awards because their duties of confidentiality and loyalty will prohibit them from providing information to government authorities, if that information was learned as part of their representation," O'Toole said. He added that few exceptions to these rules exist for in-house lawyers who want to pursue a whistleblower claim. The Securities and Exchange Commission rule that denies protections to lawyers who attempt to disclose privileged information does permit disclosure for the purpose of preventing serious financial harm or perjury and rectifying harms caused by the misuse of the attorney's services. "It has been suggested that these rules permit disclosures that may not be permitted by some state ethics rules but it is not clear that is the case."

To prevent missteps in the event a corporate counsel has a whistleblower claim, " ... model state ethics rules -- some version of which have been adopted by most states -- strongly encourage lawyers to raise concerns in-house, through the highest channels within the organization itself. If the lawyer is not satisfied with the response, the lawyer should generally withdraw and resign as in-house counsel," O'Toole said. "The state bars around the country have not hesitated to punish lawyers who blow the whistle on their clients outside of the narrow circumstances permitted by the rules. And for good reason. One of the most important attributes of an attorney is his or her ability to maintain client confidentiality. If corporate counsel disclosed confidences at will, the attorney-client relationship as a whole would be greatly damaged." Additionally, it is up to companies to maintain ethical protocol. Regardless of "ethical landmines," if an in-house counsel is willing to raise concerns, a company should ensure they address them promptly and thoroughly. "Whistleblower programs can serve important policy interests, but lawyers generally should not be part of them unless they are acting ethically under the lawyer-conduct rules that have been formulated over centuries," he added.

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