RICHMOND – A Virginia law firm that advised its client to take notes about his conversations with co-workers at Duke University Health System and share those notes with his legal team did not violate ethical rules against communicating directly with an opposing party, a North Carolina federal judge has ruled.
“Duke implies that it is professional misconduct for a lawyer to fail to instruct a relator-client to walk away or to refuse to listen when co-workers mention anything about their employer’s lawyers, but it has cited no case for such an overbroad proposition,” U.S. District Judge Catherine Eagles wrote last month in denying a motion for sanctions against the law firm.
Joseph Thomas, a research analyst in Duke’s pulmonary division, filed a False Claims Act lawsuit alleging that Duke had falsified and manipulated scientific research data used to obtain federal research grants. Thomas, who is represented by attorneys from the Roanoke-based law firm Gentry Locke, continued to work for Duke after filing suit. Such cases are known as qui tam suits because the employee is suing on behalf of the U.S. government, alleging that the government has been defrauded.
While the suit remained under seal—which is to say, before anyone at Duke knew that Thomas had filed suit—Thomas spoke with multiple co-workers about the alleged fraud and Duke’s response to it. At his attorneys’ suggestion, he took notes about these conversations and shared information he learned from co-workers with his lawyers. Allegedly, some of these conversations tended to indicate that Duke was continuing to cover up the fraudulent data.
Whistleblowers who sue their employers under the FCA can use any information that ordinarily flows to them at work in their lawsuits. But Duke contended that Thomas’s attorneys deliberately orchestrated and directed conversations with Duke’s employees and secured Duke’s privileged information in violation of North Carolina’s Rules of Professional Conduct. It sought sanctions including disqualification of Thomas’ attorneys, who denied any wrongdoing.
The RPC prohibit a lawyer from communicating directly with an adverse party who is represented by counsel without their attorney’s consent, and also from violating any rule “through the acts of another.” Duke contended that these rules, when read together, prohibited Thomas’ attorneys from deliberately soliciting information from Duke’s employees via Thomas after he filed this lawsuit and once it became apparent Duke was represented by counsel.
The few cases addressing whether an attorney has committed misconduct by acting through his client indicate that a client is free to act independently in talking with potential witnesses, but ethical problems arise when lawyers cause, or assume control and direction over, those conversations. Looking at the facts of the case as alleged by Thomas and Duke, however, Eagles found that Duke had failed to prove any misconduct by Thomas’ attorneys, let alone willful misconduct that would merit sanctions.
In its motion, Duke emphasized Thomas’ admission that he regularly reported what co-workers shared with him to his attorneys, and took notes of his interactions at their suggestion, but Eagles said she was unpersuaded that this suggested evidence of misconduct.
“There are many legitimate reasons for counsel to ask a client to take notes about what he sees and hears and to provide that information to counsel [including] the need for an aid to memory as time passes,” Eagles wrote. “It would be a strange result indeed if a qui tam relator could not take notes or tell his lawyers about facts and actions which would support the claims in his lawsuit [or] additional violations of the False Claims Act, such as statements tending to indicate Duke was attempting to hide or minimize the false data in its communications with outsiders.”
Duke argued that the sheer number of Thomas’ conversations about the data issue supported an inference that his attorneys were directing them, but Eagles rejected this argument as well. She noted that the conversations were with people with whom Thomas ordinarily had work-related contact and some of them appear to have been initiated by his co-workers. Given the widespread concern about the issue within the pulmonary lab, the number of conversations Thomas had with his co-workers about it “is neither surprising nor suspicious,” Eagles wrote.
Eagles postponed any consideration of whether Thomas’ notes about the conversations would actually be admissible into evidence.
Matt Broughton, a senior partner for Gentry Locke, declined to comment on the ruling, citing the ongoing nature of the case.
Carol Poindexter and Rick Robinson, both of Washington, D.C., were listed in court records as Duke’s lead attorneys. Poindexter also declined to comment because of the ongoing litigation.
Charlotte lawyer Tony Scheer, who represents whistleblowers but was not involved in the case, read the ruling at North Carolina Lawyers Weekly’s request. Scheer said that an attorney would not generally be permitted to direct their client to obtain information to which they would not otherwise be entitled, including interrogating their coworkers on subjects unrelated to their own employment.
“It looks like Duke was making the argument that there was enough smoke here to draw a conclusion by inference that the attorneys were sending their client out on a fact-finding mission,” Scheer. “But I think Judge Eagles made a factual determination that there wasn’t enough evidence to draw that inference.”