Can one lawyer serve as in-house counsel for several unrelated corporations at the same time?

Plain-English summary

The inquirer asked whether a lawyer may work for more than one unrelated corporation as in-house counsel, where a company's legal department would be shared among several other companies. The committee answered yes, explaining that the lawyer would have as many corporate clients as the corporations represented, and that so long as one corporation is not making a profit by "renting out" the lawyer's services and the RPCs are followed (for example on conflicts of interest between the corporations), the arrangement appears not to violate the rules. It cited ABA Informal Opinion 973, ABA Formal Opinion 95-392, RPC 1.7, and RPC 5.4. The committee added that the lawyer should take care in any joint representation to keep within the RPCs, confirm any joint representation in writing, and withdraw from any representation that would create a conflict that cannot be waived.

In its analysis, the committee said ABA Formal Opinion 95-392 addresses two main issues: a non-lawyer making a profit on a lawyer's services (for example, when a corporation "rents" the lawyer to other clients or when a court awards attorney's fees beyond what the corporation paid), and the principle that a lawyer's independent judgment may not be compromised by a non-lawyer, citing ABA Model Rule 5.4 and Washington's RPC 5.4. So long as the representation proceeds without a non-lawyer making a profit and in a conflict-free manner, the committee said there did not appear to be any problem with an in-house lawyer representing more than one corporation.

On the second issue, the wording of the letterhead the lawyer would use when corresponding on behalf of the corporations, the committee said the letterhead must comply with Title 7 of the RPCs, noting that RPC 7.1 and 7.5 provide that letterhead may not be false or misleading. It said it does not usually opine on the appropriateness or legality of specific letterhead wording, including the appropriate designation for an individual, and declined to do so here.

Currency note

This opinion was issued in 2004, before the Washington State Bar Association's adoption of the 2006 revisions to the Rules of Professional Conduct. Subsequent rule amendments or later opinions may have changed the analysis. Treat this page as historical context, not current guidance. Verify against current rules before relying on any specific rule mentioned here.

In practice

Under the Washington rules as they stood at the time of the opinion, the committee treated a shared in-house lawyer as having a separate attorney-client relationship with each corporation. It conditioned the arrangement on two limits drawn from RPC 5.4: no non-lawyer may profit on the lawyer's services (no "renting out" for fees above the lawyer's salary), and no non-lawyer may compromise the lawyer's independent judgment. The committee layered RPC 1.7 on top, requiring conflict management, written confirmation of any joint representation, and withdrawal from any non-waivable conflict. On letterhead, it applied RPC 7.1 and 7.5's anti-misleading standard but declined to pass on specific wording.

Common questions

Q: Can one lawyer be in-house counsel for multiple unrelated companies?

A: The committee said yes, with each company treated as a separate client, as long as no company profits by renting out the lawyer's services and the RPCs, including the conflict rules, are followed.

Q: What is the limit under RPC 5.4?

A: The committee said a non-lawyer may not make a profit on the lawyer's services and may not compromise the lawyer's independent professional judgment.

Q: What conflict steps did the committee describe?

A: The committee said the lawyer should keep joint representations within the RPCs, confirm any joint representation in writing, and withdraw from any representation that would create a conflict that cannot be waived under RPC 1.7.

Q: Did the committee approve specific letterhead wording?

A: No. The committee said the letterhead must comply with RPC 7.1 and 7.5 (not false or misleading) but declined to opine on specific wording or designations.

Background and rules framework

The opinion interprets RPC 1.7 (Model Rule 1.7, conflicts of interest with current clients) and RPC 5.4 (Model Rule 5.4, professional independence of a lawyer; barring non-lawyer profit on legal services and protecting independent judgment), and applies RPC 7.1 and 7.5 (Model Rules 7.1 and 7.5) to the letterhead question. The committee relied on ABA Formal Opinion 95-392 and ABA Informal Opinion 973 for the framework on in-house lawyers serving more than one corporate client. The analysis turns on keeping each corporation a separate client, preventing non-lawyer profit, and managing conflicts.

Citations and references

Rules of Professional Conduct:

• Model Rule 1.7 / Washington RPC 1.7 (conflicts of interest with current clients)
• Model Rule 5.4 / Washington RPC 5.4 (professional independence; non-lawyer profit and independent judgment)
• Model Rules 7.1 and 7.5 / Washington RPC 7.1 and 7.5 (letterhead may not be false or misleading)

Other opinions cited:

• ABA Formal Opinion 95-392: a lawyer's services shared with a for-profit employer; non-lawyer profit and independent judgment
• ABA Informal Opinion 973: in-house lawyer representing more than one corporation

See also

• ABA Formal Op. 95-392: Sharing Fees With a For-Profit Employer
• WSBA Ethics Op. 1143: Salaried Nonprofit Lawyer and Fee-Sharing
• WSBA Ethics Op. 1045: Corporate Counsel Stock Compensation

Source

• Landing page: https://ao.wsba.org/print.aspx?ID=1327

Original opinion text

Reproduced from the official source for research purposes. The linked source is authoritative.

Advisory Opinion: 2084
Year Issued: 2004
RPC(s): ABA Informal Op. 973, ABA Formal Op. 95-392, RPC 1.7, 5.4
Subject: Services of company’s legal department to be shared among several other companies

First Issue: The inquirer asks whether or not a lawyer may work for more than one unrelated corporation as in-house counsel.

Answer: Yes. Essentially the lawyer will have as many corporate clients as corporations the lawyer is representing. So long as one corporation is not making a profit by "renting out" the lawyer’s services, and the RPCs are followed (e.g., conflicts of interest between the corporations), this arrangement appears not to violate the RPCs. See ABA Informal Op. 973, ABA Formal Op. 95-392, RPC 1.7 and 5.4.

The lawyer should also take care in any circumstance that would involve joint representation of various clients to insure that the RPC`s are not violated and that any joint representation is confirmed in writing. The lawyer must withdraw from any representation that will result in a conflict that can not be waived.

Analysis: ABA Formal Op. 95-392 addresses primarily the following issues:

1. A non-lawyer making a profit on a lawyers services (i.e., by collecting fees for the attorneys work above and beyond the salary paid by the corporation). This may happen when the corporation "rents" the lawyer to other clients or when a court awards attorneys fees beyond what the corporation paid for the attorneys services.

2. A lawyer`s independent judgment may not be compromised by a non-lawyer (the corporation). See, ABA Model Rule 5.4 and Washington’s RPC 5.4.

So long as the representation proceeds without a non-lawyer making a profit and in a "conflict-free" manner, there does not appear to be any problem with an in-house lawyer representing more than one corporation.

Second Issue: The inquiring lawyer also asks what the wording of the letterhead may be when the lawyer corresponds on behalf of the corporations.

Answer: The letterhead must comply with Title 7of the RPCs. Note particularly that RPC 7.1 and 7.5 state that the letterhead may not be false or misleading. The committee does not usually opine about the appropriateness or legality of specific wording of letterhead, including the appropriate designation for an individual in the letterhead, and declines to do so here.