Conflict of Interest Lawyer Phoenix, Arizona
A conflict of interest is a breach of an attorney’s fiduciary duty to loyally protect the interests of his or her client.
The Entrekin Law Firm handled a case where a corporation’s in house lawyer learned all of the corporation’s confidential secrets; when the lawyer felt he was not being paid enough and there was too much oversight of his work, he used the information and relationships he had gained as corporate counsel to start a competing corporation of his own and to poach his former employer’s clients, while also trying to discredit his former employer. These kinds of cases rarely end well for the defendant and often lead to discipline by the State Bar, as well as a malpractice judgment against the offending attorney.
Cases like the one described above are pretty rare. The most common type of conflict of interest case occurs when a lawyer has a long term client and is referred to a second party who wants to do business with the long term client. Rather than refer the second party to another lawyer, the lawyer tries to represent both sides. Eventually the interests of the two sides conflict and the lawyer invariably sides with the long term client, damaging the second party, whom the lawyer also represents.
The lawyer then tries to claim either that he or she had stopped representing the second party or that he received a signed waiver of conflict of interest from both sides and this makes what he did acceptable. The lawyer almost always has failed to notify the second party that he or she has now become adverse to them. With regard to the second excuse, a waiver of conflict, many conflicts cannot be waived.
The classic case setting forth this type of scenario is Hyatt Regency v. Winston & Strawn, 907 P.2d 506, 184 Ariz. 120 (App. 1995). In that case, an attorney tried to represent both a contractor and sub-contractor, with the contractor being his main client. When the interests of the sub-contractor became adverse to those of the contractor, he badly damaged the interests of the sub-contractor to protect his long time client. This led to a legal malpractice verdict of several million dollars, which was upheld on appeal.
The Entrekin Law Firm has handled a number of cases with this general fact pattern and other conflict of interest cases. If you believe that your attorney has engaged in a conflict of interest and that this has caused you serious financial damages, give us a call.