more ethical traps for in-house counsel · §conflicts of interest facing in house counsel...
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More Ethical Traps for In-House CounselTerri Mascherin and John Storino
Program Overview
Terri MascherinJohn Storino
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Program Overview§ Basics of Preserving the Attorney-Client Privilege
§ Conflicts of Interest Facing In House Counsel
§ Ethical Issues in Settling Disputes
§ In House Counsel as a Target for Litigation and Prosecution
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Polling Test§ Question: Why are you here today?
§ Answer:§ I live for ethics.§ Are you kidding? The reporting deadline is in 7 weeks and I don’t have a
single ethics CLE credit yet.
Basics of Preserving the Attorney-Client PrivilegeTerri MascherinJohn Storino
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Attorney-Client Privilege: Elements§ Client: Who is the client?
§ Lawyer: Who is a lawyer?
§ Communication: Not facts alone
§ Legal Purpose: Not business or non-legal compliance
§ Confidentiality: Intended and maintained
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Who is the Client?ABA Model Rule of Professional Conduct 1.13(a):
“A lawyer employed or retained by an organization represents the organization acting through its duly authorized constituents.”
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Who is the Client?§ Upjohn Co. v. United States, 449 U.S. 383, 394-95 (1981)
– Federal question cases, plus some states, including Massachusetts, Pennsylvania.
§ Litigation Control Group – Alaska, Hawaii, Illinois, Maine, New Hampshire, New Jersey, North Dakota, Oklahoma, South Dakota.
§ Subject Matter – other states, including California, Florida, Kentucky, Utah.
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Who is the Client: Upjohn§ Information is necessary to supply the basis for legal
advice to the organization and was ordered to be communicated by superior officers;
§ Information was not available from “control group” management;
§ Employees were aware that they were being questioned in order for the organization to secure legal advice; and
§ Communications were considered confidential when made and kept confidential thereafter.
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Who is the Client: Upjohn
§HR Department Interviews with University employees.
§ Carter v. Cornell Univ., 173 F.R.D. 92, 95 (1997).
§University Counsel’s Interviews of University employees.
§ Denver Post Corp. v. Univ. of Colorado, 739 P.2d 874, 880 (Colo. App. 1987)
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Who is the Client: Control Group
§Top Management who have authority to make decisions based on legal advice, and
§Advisors: Those “whose advisory role to top management in a particular area is such that a decision would not normally be made without [their] advice or opinion, and whose opinion in fact forms the basis of any final decision by those with actual authority.”Consolidation Coal Co. v. Bueyrus-Erie Co., 89 Ill. 2d 103 (Ill. 1982).
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Who is the Client: Subject Matter§ Not limited to control group.§ Focus is on content of the communication with corporate
counsel.§ Communication is made at direction of employee’s
superiors.§ The “subject matter upon which the attorney’s advice is
sought by the corporation and dealt with in the communication is the performance by the employee of the duties of his employment.Ӥ Harper & Row Publishers, Inc. v. Decker, 423 F. 2d 487, 491 (7th
Cir. 1970).
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Who is the Client: Significance§ Client “owns” privilege and right to:
§ Assert privilege and forbid disclosure of information.§ Waive privilege and disclose information.
§ Who decides for the Organization?§ Management: Board of Directors/Trustees§ Senior Officer.§ Organization general counsel often deemed authorized to waive. § “The authority to waive the attorney-client privilege does not belong to each
and every employee of the corporation, but rather is held by the organizational client, namely the officers and directors of the organization.”
Hedden v. Kean Univ., 434 N.J. Super. 1, 15, 82 A.3d 238, 247 (App. Div. 2013)
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Who is a Lawyer?§ A lawyer who is an active “member of a bar of a court”
§ Who is acting as a lawyer — not as a business person or administrator.
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Who is a Lawyer: Corporate Counsel
Is Corporate Counsel Acting In a Legal Capacity?
Yes
Privilege if clear showing that counsel was acting in a legal capacity
as to each communication or category of communications.
See, e.g., Acosta v. Target Corp., 281 F.R.D. 314, 323 (N.D. Ill. 2012); Seacoast Builders Corp. v. Rutgers, 358 N.J. Super. 524, 818
A.2d 455 (App. Div. 2003).
No
No privilege
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Let’s Test This Out§Former employee threatens to sue the company for
wrongful termination. § Rodriguez, the employee’s former supervisor, writes a
memo to corporate counsel, Eaton, requesting legal advice.
§ Rodriguez also sends a copy of his memo to Chauncy, his Division VP.
§ Is the memo still privileged? § Yes§ No, by copying the non-lawyer, Rodriguez defeated the
privilege.
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Let’s Test This Out
§What if Rodriguez writes a separate letter to VP Chauncy outlining why he believes the employee’s allegations are false?
§ Is this letter privileged?§ Yes, Rodriguez was reporting on a matter of legal
concern to a corporate manager.§ No, there was no lawyer involved in this communication.
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Who is a Lawyer: Compliance Personnel§ Privilege may apply if acting at direction of lawyer
to secure legal advice. § Communications with compliance personnel conducting
investigation at direction of lawyers held privileged. In re Kellogg Brown & Root, Inc., 756 F.3d 754, 759 (D.D.C. 2014).
§ Privilege may not apply to routine compliance fact records where no evidence legal advice was sought or given.
§ Logs of complaints compiled by compliance department had no legal purpose and were not privileged. U.S. ex rel. Baklid-Kunz v. Halifax Hosp. Med. Ctr., No. 6:09-CV-1002-ORL-31, 2012 WL 5415108, at *6 (M.D. Fla. Nov. 6, 2012).
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Who is a Lawyer: Compliance Personnel
§Larry Nassar Scandal—Michigan State University§ Paulette Granberry Russell, lawyer serving as chief diversity
officer, overseeing Title IX complaints.§ 2014, Granberry Russell’s office received sexual assault complaint
against Dr. Larry Nassar.§ President Lou Anna Simon later charged with lying to police about
what she knew about Nassar and when she knew it.§ Prosecution called Granberry Russell to testify about 2014 meeting
with Simon. Notes and agenda for meeting mentioned Nassar.§ Granberry Russell testified she did not recall referring to Nassar at
the meeting; prosecutors used her files in cross-examination to show she probably told Simon about Nassar.
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Communications, Not FactsPrivilege protects communications to seek or provide legal advice.
§ Facts, alone, are not privileged.
Must be for purpose of seeking or providing legal advice.
§ Merely including attorney in communication does not make a business communication privileged.
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Legal PurposeTIPS: Advice by In-House Counsel§ Determine who may act as lawyer for Corporation.§ Use legal titles; identify lawyers on organization charts.§ Identify when you are acting as lawyer.
§ Expressly state purpose is to provide legal advice.
§ Educate employees to expressly request legal advice.
§ Label privileged communications.§ Avoid mixing legal and business advice.§ Limit distribution of legal advice on need-to-know basis.
§ Start a new email chain.
§ Limit access to legal department files and data.
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Confidentiality: Intended and Maintained
§Privilege generally maintained for communications with:§ Employees with “need to know” legal advice§ Employees who provide information to attorney for
purpose of obtaining legal advice for the Corporation§ Qualified agents of the attorney or client assisting with
obtaining or providing legal advice
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Who Can Waive the Privilege? § Only the client can waive.
§ When Corporation is client, it “owns” the privilege. § Officer or employee cannot waive privilege for the Corporation unless
authorized to do so.
§ But Corporation counsel often deemed authorized to waive privilege.§ Waiver may occur when a communication is disclosed beyond those
with “need to know,” including other Corporation employees.
§ Corporation can waive privilege even if individual would prefer it not be waived.
§ May be an issue if individual is “co-client.”
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Let’s Test This Out
§Company CEO Frank meets with corporate counsel Eaton to discuss a lawsuit by a former employee.
§ Later, over lunch with a colleague who has no role in the case, CEO Frank recounts Eaton’s advice.
§ Is attorney Eaton’s advice privileged?§ Yes.
§ No.
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Let’s Test This Out
§Division VP Chauncy was copied on a privileged memo from corporate counsel regarding company employment issues. Chauncy forwards the email to her daughter, who is a 2L and is taking employment law.
§ Is the memo still privileged?§ Yes.
§ No. What the heck, the VP told her daughter?
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Let’s Test This Out§ CEO Frank asks corporate counsel Eaton to prepare a legal
memo on the potential legal vulnerabilities of the company’s sexual harassment policies.
§ Attorney Eaton sends CEO Frank his memo, and Frank distributes it to the Managers of every Department in the company, telling them to be careful and inviting anyone who may be interested to attend an upcoming meeting on the company’s policies.
§ Is the memorandum still privileged?§ Yes, if these employees have a need to know.
§ No, Frank distributed the memo outside of the control group.
Conflicts of Interest Issues Facing In House CounselTerri MascherinJohn Storino
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Conflicts of Interest§Prior work conflicts
§Subsidiaries and Affiliates
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Prior Work Conflicts§ABA Model Rule 1.7(a)(2)
(a) . . . A concurrent conflict of interest exists if:
(2) there is a significant risk that the representation of one or more clients will be materially limited by the lawyer's responsibilities to another client, a former client or a third person or by a personal interest of the lawyer.
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Prior Work Conflicts§ABA Model Rule 1.7:
§ Comment [8]: § Even where there is no direct adverseness, a conflict of interest exists if
there is a significant risk that a lawyer's 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's other responsibilities or interests.
§ Comment [10]: § The lawyer's own interests should not be permitted to have an adverse
effect on representation of a client. For example, if the probity of a lawyer's own conduct in a transaction is in serious question, it may be difficult or impossible for the lawyer to give a client detached advice.
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Prior Work Conflicts§ Iowa State Bar Association Ethics Opinion 09-
03:§ “What is at issue is the ‘lawyer’s independent professional judgment in
considering alternatives.’ The risk is that a lawyer . . . whose work product is attacked may easily become subjective and self-defensive at the expense of providing objective and independent judgment to the client.”
§ Lawyers would be well-advised to “rhetorically ask the following question: If, at the conclusion of the [dispute] the lawyer’s . . . work product or performance in the underlying matter is found to be deficient, have they, by undertaking that representation, needlessly exposed themselves to a legal claim or ethics complaint alleging that they have failed to provide independent professional judgment . . . or that their actions on behalf of the client were merely an attempt to gloss over or cover up their own mistakes?”
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Prior Work Conflicts§ Veras Inv. Partners, LLC v. Akin Gump Strauss Hauer &
Feld LLP, 851 N.Y.S.2d 61, 2007 WL 2792175 (N.Y. Sup. Ct. 2007) (unreported):
§ Firm advised hedge fund manager in creation of funds, continued to represent manager in ensuing regulatory investigations.
§ Manager later sued firm for malpractice and fraud, claiming firm had offered advice that was not in the manager’s interest to avoid scrutiny of the firm’s own work in creating the funds.
§ Leonard v. Dorsey & Whitney LLP, 553 F.3d 609, 628–29 (8th Cir. 2009)
§ Firm represented company in documenting loan and later litigation over transaction. Company went into bankruptcy.
§ Trustee sued for malpractice and breach of fiduciary duty due to prior work conflict.
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Let’s Test this Out§ General Floaters corporate counsel, Amit, negotiated and
drafted contract to supply key parts to GF’s largest customer. Contract included force majeure clause:
§ Notwithstanding anything to the contrary contained herein, neither party shall be liable for any delays or failures in performance resulting from acts beyond its reasonable control including, without limitation, acts of God, acts of war or terrorism, shortage of supply, breakdowns or malfunctions, interruptions or malfunction of computer facilities, or loss of data due to power failures or mechanical difficulties with information storage or retrieval systems, labor difficulties or civil unrest.
§ GF forced to shut down production due to COVID-19 and Stay at Home Order. Amit advised GF’s CEO to invoke force majeure clause.
§ Customer threatens suit, argues clause doesn’t apply. The CEO asked Amit for advice on how to respond.
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Let’s Test This Out§Should Amit advise the CEO on how to respond to
threats that force majeure doesn’t apply?§ Yes.§ No.
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Conflicts: Subsidiaries and Affiliates§Who is your client?
§ABA Model Rule 1.0, Comment 3:§ “With respect to the law department of an organization, including
the government, there is ordinarily no question that the members of the department constitute a firm within the meaning of the Rules of Professional Conduct. There can be uncertainty, however, as to the identity of the client. For example, it may not be clear whether the law department of a corporation represents a subsidiary or an affiliated corporation, as well as the corporation by which the members of the department are directly employed.”
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Conflicts: Subsidiaries and Affiliates§ABA Model Rule 1.7, Comment 34:
§ “A lawyer who represents a corporation or other organization does not, by virtue of that representation, necessarily represent any constituent or affiliated organization, such as a parent or subsidiary.
§ A conflict arises if: “the circumstances are such that the affiliate should also be considered a client of the lawyer . . . or the lawyer’s obligations to either the organizational client or [the subsidiary or affiliate] . . . are likely to limit materially the lawyer’s representation of the other client.”
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Conflicts: Subsidiaries and Affiliates§When are the parent and subsidiary/affiliate
considered a single client?
§Majority rule: multi-factor test, considering§ The degree of “operational commonality” between the parent and
affiliate, including whether they share common infrastructure and common employees, and
§ The extent to which one company depends financially upon the other. Would an adverse outcome for one of the companies “result in substantial and measurable loss” to the other.§ GSI Commerce Solutions v. BabyCenter L.L.C, 618 F. 3d 204 (2d Cir. 2010).
§ Fact that an affiliate is wholly-owned not dispositive.§ ABA Formal Ethics Opinion 95-390 at 1001:261-62.
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Conflicts: Subsidiaries and Affiliates§Minority Approaches:
§Bright Line: each corporate affiliate is treated as separate client for conflicts purposes.
§ Gen-Cor, LLC v. Buckeye Corrugated, Inc., 111 F. Supp. 2d 1049, 1053 (S.D. Ind. 2000); Stratagem Dev. Corp. v. Heron Int’l. N.V., 756 F. Supp. 789, 792 (S.D.N.Y. 1991).
§Alter Ego: parent and affiliate are treated as one entity only if one is the alter ego of the other.
§ Goodlett v. The Paul Revere Life Ins. Co., C97-0089, 2000 WL 34027916, at *3 (N.D. Iowa Jan. 15, 2000); Brooklyn Navy Yard Cogeneration Partners L.P. v. Superior Court, 70 Cal Rptr. 2d 419, 425 (Cal. App. 1997).
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Conflicts: Subsidiaries and Affiliates§Parent and affiliate may be joint clients where
counsel is doing legal work for both entities on a matter of common interest.
§ In re Teleglobe Commun. Corp., 493 F.3d 345, 363 (3d Cir. 2007), as amended (Oct. 12, 2007).
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Let’s Test This Out§ ABC Corp. wholly owns a subsidiary, Little Co. ABC’s legal
department provides legal services to Little Co. under a shared services agreement.
§ ABC decides to spin off Little Co. by dividending shares of Little Co. to ABC’s shareholders.
§ To save expenses, ABC’s CEO wants the legal department to represent both ABC and Little Co. in documenting the transaction.
§ Should counsel represent both companies?§ Yes.§ No.
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Let’s Test This Out§ Same hypothetical, but separate counsel has been hired to
represent Little Co. in the transaction.
§ ABC and Little Co. are both PRPs in an environmental dispute. Corporate counsel have been representing both companies.
§ Once ABC and Little Co. begin work on the spin-off, can corporate counsel continue to represent Little Co. in the environmental dispute?§ Yes.§ No.
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Conflicts: Subsidiaries and Affiliates§ABA Model Rule 1.7: Lawyer cannot represent
two current clients whose interests are in conflict, unless:§ “(1) the lawyer reasonably believes that the lawyer will be able to
provide competent and diligent representation to each affected client;
§ (2) the representation is not prohibited by law; § (3) the representation does not involve the assertion of a claim
by one client against another client represented by the lawyer in the same litigation or other proceeding before a tribunal; and
§ (4) each affected client gives informed consent, confirmed in writing.”
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Conflicts: Subsidiaries and AffiliatesNYCB Opinion 2001-2 provides five factors to consider:
(1) how adversarial the relationship is between the clients;
(2) likelihood that confidential information in one matter will be relevant to the other;
(3) ability of lawyer to ensure client confidences will be preserved and segregated;
(4) ability of lawyer to explain, and the clients’ ability to understand, the risks of the conflict; and
(5) whether lawyer has a disproportionately “important” relationship with one client compared to the other.
No absolute bar
Ethical Issues in Settling Disputes
Terri MascherinJohn Storino
Some Professional Conduct Rules to Consider in Settlement Negotiation
Illinois Rule of Professional Conduct 4.1
Illinois Rule of Professional Conduct 3.3
TRUTHFULNESS IN STATEMENTS TO OTHERS
CANDOR TOWARD THE TRIBUNAL
Illinois Rule of Professional Conduct 8.4MISCONDUCT - THREATS
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Rule 4.1: Truthfulness in Statements to Others§ In the course of representing a client a lawyer shall not
knowingly: a. make a false statement of material fact or law to a third
personb. fail to disclose a material fact when disclosure is
necessary to avoid assisting a criminal or fraudulent act by a client, unless disclosure is prohibited by Rule 1.6.
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What is a false statement of material fact?
It Depends§ In negotiation, certain types of statements ordinarily are not
considered statements of material fact:
§ Estimates of value.
§ A party’s intentions as to an acceptable settlement.
§ Existence of an undisclosed principal, except where nondisclosure of the principal would constitute fraud.
§ “Posturing” or “puffing”
§ Standard of truthfulness is the same in direct settlement negotiations and in caucused mediation
§ Rule 4.1, Comment 2§ ABA Formal Opinion 06-439
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So how can I get in trouble?Outright False Statements
§ False representation that lawyer had access to identity of a key witness.
§ Ausherman v. Bank of America Corp., 212 F.Supp.2d 435 (D. Md. 2002)
§ Misrepresentation of total amount of client’s insurance coverage
§ Plaintiff settled personal injury case for “policy limits” based on representations of defense counsel.
§ Plaintiff sued for fraud after learning that there was another $1 million in excess coverage.
§ Slotkin v. Citizens Cas. Co. of N.Y., 614 F.2d 301 (2d. Cir. 1980); In re McGrath, 96 A.D.2d 267 (N.Y. App. Div. 1983)
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Where is the line?Otto v. Hearst Commun., Inc., 2019 WL 1034116 (S.D.N.Y.)
§ Defendant’s motion for sanctions: misrepresentation as to whether a license agreement was pursuant to the settlement of a different lawsuit.
§ Bad faith misconduct standard: “clear evidence that the . . . conduct [was] entirely without color and taken for improper purposes.”
§ Fraud upon the court—five factors: (1) intentional bad faith; (2) prejudice; (3) pattern of misbehavior; (4) whether/when misconduct corrected; (5) likelihood misconduct will continue
§ Court disapproves of conduct, but doesn’t impose sanctions
1. No clear and convincing evidence, because no record of negotiations2. No settlement based on misrepresentation = no prejudice3. To the extent plaintiff’s justification was colorable, he was simply
“posturing about the value of [the plaintiff’s] case . . . as lawyers often do.”
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Can I can get in trouble for reporting misconduct?Otto v. Hearst Commun., Inc., continued
§ Plaintiff’s cross-motion for sanctions: violation of FREs and court’s standing order re: confidentiality of settlement negotiations
§ Court denies motion: defendant was very careful.§ Defendant raised the subject of the motion at a status conference, without
disclosing any communications.
§ With court’s permission, defendant served redacted and un-redacted motions on plaintiff; plaintiff had opportunity to object prior to filing.
§ Defendant only e-filed motion after this process was complete.
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When must a lawyer voluntarily disclose facts?
It Depends
Rule 4.1, Comment 1§ Generally, a lawyer has no affirmative duty to inform an opposing
party of relevant facts.
§ But, a lawyer should not incorporate or affirm someone else’s statement if the lawyer knows it is false.
§ And, a half-truth or misleading statement can be a misrepresentation.
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Misrepresentation by OmissionFailing to Disclose Material Facts/
Telling Half Truths
§ Lawyer failed to disclose fact that client died§ Kingsdorf v. Kingsdorf, 797 A.2d 206 (Super. N.J. 2002); Virzi v. Grand Trunk
Warehouse and Cold Storage Co., 571 F.Supp 507 (E.D. Mich. 1983)
§ Spaulding v. Zimmerman, 116 N.W.2d 704 (Minn. 1962)
§ Court vacated settlement when defense counsel knew – but plaintiff did not know -- that minor plaintiff suffered from a far more serious medical condition
§ While plaintiff’s counsel did not pursue discovery, defense counsel was part of the joint application to court approving settlement.
§ “Character of the concealment” and plaintiff’s minority were factors in the decision to vacate.
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Misrepresentation by Omission§ Sheppard v. River Valley Fitness One, L.P., 428 F.3d 1 (1st Cir. 2005)
§ Attorney sanctioned for failing to disclose true terms of settlement agreement in a related case.
§ Attorney disclosed $50,000 face value of settlement with a co-defendant in an effort to intimidate defendant, but failed to disclose that the co-defendant was only paying $100 under the settlement
§ Mentioning settlement in a related case did not oblige attorney to disclose full settlement terms, but disclosing face value of the judgment gave rise to a duty to disclose settlement’s true dollar value.
§ Even though the words were “literally true,” counsel had an obligation not to misled opposing counsel by omission.
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What if I’m in a settlement conference?
Tell the Truth.
Rule 3.3: Candor Toward the Tribunal
A lawyer shall not knowingly:
make a false statement of fact or law to a tribunal or fail to correct a false statement of material fact or law previously made to the tribunal by the lawyer.
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What do I have to tell the judge?
Just the Facts
§ A lawyer is not required to disclose the limits of her settlement authority, or her advice regarding settlement.
§ However, a lawyer may not make a misrepresentation to a judge.
§ So, if you decide to share, tell the truth.
§ If a judge improperly pressures a lawyer to reveal confidential settlement discussions, the lawyer should decline to answer.
§ ABA Formal Opinion 93-370
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So how can I get in trouble?
Telling Half Truths
§ Lawyers disclosed contingent fee agreement and negotiated amount for fees in settlement, but didn’t tell the Judge that client also agreed to pay part of her settlement recovery to the lawyer.
§ Attorneys “should have either disclosed the complete fee arrangement or politely declined any discussion of fees” with the settlement judge.
§ In re Fee and Montijo, 898 P.2d 975 (Ariz. 1995)
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Can I threaten the other side?
It Depends.
Illinois Rule 8.4(g): MISCONDUCT – THREATS
It is professional misconduct for a lawyer to:
present, participate in presenting, or threaten to present criminal or professional disciplinary charges to obtain an advantage in a civil matter.
Comes up all the time
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What kinds of threats are misconduct?It Depends
§ Illinois Rule 8.4(g) is particularly strict:§ Some states limit misconduct to threats made “solely” to
obtain advantage in a civil matter. § Some states prohibit only threats of criminal
prosecution, not threats of disciplinary charges.
§ Prohibition against threat of criminal prosecution deliberately omitted from ABA Model Rules.§ General rules already prohibit “extortionate, fraudulent,
or otherwise abusive threats.”
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So how do I get in trouble?Threatening Criminal Prosecution
§ Misconduct for attorney to state – as part of settlement discussions --that his client was inclined to “unveil this sham . . . and ask that [the opposing party] be prosecuted.”
§ ISBA Advisory Opinion 91-29
Threat of criminal prosecution would violate Model Rules if:
§ criminal wrongdoing is unrelated to client’s civil claim,
§ lawyer did not believe the civil claim and the potential criminal charges to be well-founded, or
§ threat constituted attempt to exert or suggest improper influence over the criminal process.
§ ABA Formal Opinion 92-363
In House Counsel As a Target for Litigation and ProsecutionTerri MascherinJohn Storino
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Increase in actions against compliance officers§ New York City Bar Association, Report on Chief Compliance
Officer Liability in the Financial Sector (Feb. 2020)§ Growing risk of personal liability through enforcement actions§ Hindsight assessments: what should compliance officers prevented? § Holding compliance officers liable for institutional failures?§ SEC—three cases where individuals may be charged: (1) affirmative
misconduct; (2) obstructing or misleading regulators; (3) “wholesale failure to carry out . . . responsibilities”
§ Personally liable for “causing” firms’ failure to implement effective policies
§ Trouble spots: classic cases§ Insider trading§ Conflicts of interest
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Conflict of Interest, Failure to Disclose§ Securities and Exchange Commission vs. Criterion Wealth
Management Insurance Services, Inc., et al., (C.D. Cal. Feb 12, 2020)
§ Co-owners Mark MacArthur and Robert Gravette (Chief Compliance Officer) individually charged
§ Invested clients’ money in private real estate investment funds—and did not disclose special commissions and compensation agreements with certain funds
§ Complaint alleged inadequate compliance policies, concealment from outside compliance consultant, and unreasonable conduct
§ Injunctions to prevent future violation, disgorgement of profits plus pre-judgment interest, and civil penalties.
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Employee Privacy§ Can you go too far in defending your boss?
§ “Monitoring” former employees?§ Jorgen Nielsen v. Wynn Resorts, Ltd., Kimmarie Sinatra, et al. (Eight J.
Dist. Ct., Clark Co., Nev., Oct. 17, 2019)§ Former Wynn general counsel, Kim Sinatra, accused of orchestrating
spying operation on ex-employee who accused CEO Steve Wynn of sexual assault and provided information to WSJ
§ Suit alleges that scheme involved sending an undercover operative to plaintiff’s new salon at Palms Casino Resort
§ Sinatra resigned in 2018, soon after NV Gaming Control Board initiated investigation.
§ Complaint alleges invasion of privacy, tortious interference with employment relationship, and civil conspiracy.
Questions?