Necessary Evil or Slippery Slimy Slope?

The Ethics Committee is currently considering an inquiry from a lawyer seeking guidance as to the use of a private investigator in the investigation of an employer who is believed to be violating the North Carolina Wage and Hour Act. The private investigator proposes to make certain misrepresentations during the investigation, such as pretending to be a candidate interested in being hired by the employer, in order to determine if wage and hour violations are taking place. The ethics issue is whether this type of investigation violates Rule 8.4, which prohibits a lawyer from engaging in “conduct involving dishonesty, fraud, deceit, or misrepresentation” and from violating the Rules of Professional Conduct “through the acts of another.”

Some committee members feel very strongly that the Ethics Committee should not publish an opinion condoning lawyer supervision in conduct involving misrepresentations under any circumstances. Other members believe that lawyers should be allowed to supervise investigations involving some amount of deception because there are compelling scenarios where the use of deception is necessary to root out corruption. As stated in the proposed opinion, the challenge “is to balance the public’s interest in having unlawful activity fully investigated and possibly thereby stopped, with the public’s and the profession’s interest in ensuring that lawyers conduct themselves with integrity and honesty.”

After much debate, the Ethics Committee voted to publish a proposed opinion for comment. Proposed 2014 FEO 9 is extremely limited and provides that a private lawyer¹ may supervise an investigation involving misrepresentation if done in pursuit of a public interest and certain conditions are satisfied. Specifically, the proposed opinion states:

In the pursuit of a legitimate public interest, such as investigations of discrimination in housing, employment and accommodations, patent and intellectual property infringement, and the production and sale of contaminated and harmful products, a lawyer may advise, direct, or supervise the use of misrepresentation (1) in lawful efforts to obtain information on actionable violations of criminal law, civil law, or constitutional rights; (2) if the lawyer’s conduct is otherwise in compliance with the Rules of Professional Conduct; (3) the lawyer has a good faith belief that there is a reasonable possibility that a violation of criminal law, civil law, or constitutional rights has taken place, is taking place, or will take place in the foreseeable future; (4) misrepresentations are limited to identity or purpose; and (5) the evidence sought is not reasonably available through other means. A lawyer may not advise, direct, or supervise the use of misrepresentation to pursue the purely personal interests of the lawyer’s clients, where there is no public policy purpose, such as the interests of the principal in a family law matter. [Footnote omitted.]

Although some committee members continue to oppose the proposed opinion, the majority of committee members voted to publish the proposed opinion for comment after it was revised to emphasize that an investigation involving misrepresentation must be in pursuit of a legitimate public interest and is not permissible to pursue purely personal interests.

Jurisdictions that have grappled with this sticky issue have taken various approaches to allowing pretexting in certain circumstances. Some states have narrowed their version of Rule 8.4(c) to provide that it is professional misconduct for a lawyer to engage in conduct involving dishonest, fraud, deceit, or misrepresentation only if the conduct reflects adversely on the lawyer’s fitness to practice law. See, e.g. Mich. R. Prof’l Conduct 8.4(b); N.D. R. Prof’l Conduct 8.4(c); Or. R. Prof’l Conduct 8.4(a)(3); Va. R. Prof’l Conduct 8.4(c).

Other jurisdictions have interpreted their Rules of Professional Conduct to permit lawyer supervision of investigations involving misrepresentation in certain circumstances. For example, the bars of Arizona and Maryland permit lawyers to use “testers” who employ misrepresentation to collect evidence of discriminatory practices. Ariz. State Bar Comm. on the Rules of Prof’l Conduct, Op. 99-11 (1999); Md. Bar Ass'n, Op. 2006-02 (2005). The Alabama Bar has concluded that, during pre-litigation investigation of suspected infringers of intellectual property rights, “a lawyer may employ private investigators to pose as customers under the pretext of seeking services of the suspected infringers on the same basis or in the same manner as a member of the general public.” Ala. Op. RO-2007-05 (2007). The New York County Bar has approved limited deceptive techniques in the investigation of a violation of civil rights or intellectual property rights. NYCLA Comm. on Prof’l Ethics, Formal Op. 737 (2007).

The primary rationale for these rule changes and ethics opinions is the belief that the use of testers or investigators who employ deception is the only way to detect and prove certain types of unlawful conduct. Note that one of the conditions set out in the proposed opinion is that the evidence sought is not “reasonably available through other means.” Arguably, an absolute prohibition on investigations involving misrepresentation would prevent lawyers from conducting appropriate pre-filing investigations in violation of Rule 1.1 (Competence) and Rule 3.1 (Meritorious Claims and Contentions).

Do you believe that deception is sometimes necessary to get to the truth? Do you think the Ethics Committee struck the proper balance in Proposed 2014 FEO 9? Should there be more, fewer, or different restrictions on when an investigation involving misrepresentation is permissible under the Rules of Professional Conduct? Or do you agree with those committee members who feel that the Ethics Committee should take an absolute unyielding stance on a lawyer’s duty of honesty?

Speak now. The next Ethics Committee meeting will be held on April 16, 2015. At that meeting the committee will consider any comments received pertaining to Proposed 2014 FEO 9. Comments may be emailed to slever@ncbar.gov.

Suzanne Lever is assistant ethics counsel for the North Carolina State Bar.

Endnote

1. As explained in comment [1] to Rule 8.4, the prohibition in Rule 8.4(a) against knowingly assisting another to violate the Rules of Professional Conduct or violating the Rules of Professional Conduct through the acts of another does not prohibit a government lawyer from providing legal advice to investigatory personnel relative to any action such investigatory personnel are lawfully entitled to take.