Can a settlement agreement bar the plaintiff's lawyer from filing future unrelated suits against the same defendant on behalf of other, currently unidentified plaintiffs?

Plain-English summary

During settlement negotiations, the defendant's attorney proposed a clause that would prevent the plaintiff's attorney from filing additional unrelated suits, on behalf of currently unidentified plaintiffs, against the same defendant. The inquirer asked whether such a clause could be included.

The committee identified RPC 5.6(b) as the rule on point: a lawyer shall not participate in offering or making an agreement in which a restriction on the lawyer's right to practice is part of the settlement of a client controversy. The committee drew on its prior Informal Opinion 1850 (1999), which addressed a very similar issue and summarized the purpose and criticism of RPC 5.6(b), quoting commentary that one possible purpose is to prevent the client and the third party from depriving the lawyer of an ordinary benefit of representation, future business, at a time when the lawyer might be in a vulnerable bargaining position. Informal Opinion 1850 also stated that RPC 5.6 precludes a settlement that would restrain the plaintiff's attorney from lawful solicitation of future clients in similar litigation involving the subject matter of the initial case, though the use of information from the prior case may be restricted.

The committee concluded that it does violate RPC 5.6(b) for the plaintiff's attorney to enter into a settlement agreement that restricts or prevents that attorney from filing additional unrelated suits against the same defendant on behalf of currently unidentified plaintiffs, and that neither the plaintiff nor the defendant should enter into such an agreement.

In practice

Under this opinion, and under RPC 5.6(b) as it stood in 2006, the committee treated the proposed clause as a restriction on the lawyer's right to practice made part of settling a client's controversy, which the rule prohibits. The opinion holds that the plaintiff's attorney may not enter into such an agreement, and it states that neither plaintiff nor defendant should do so. The committee anchored its reasoning in RPC 5.6(b) and its prior Informal Opinion 1850, which addressed a closely similar settlement restriction.

Common questions

Q: Can a settlement bar the plaintiff's lawyer from suing the same defendant again for other clients?

A: No. The committee concluded that a clause preventing the plaintiff's attorney from filing additional unrelated suits against the same defendant on behalf of currently unidentified plaintiffs violates RPC 5.6(b).

Q: Does the rule fall on the plaintiff's lawyer, the defense lawyer, or both?

A: Both. RPC 5.6(b) bars participating in offering or making such an agreement, and the committee said neither plaintiff nor defendant should enter into it.

Q: Why does the rule exist?

A: Quoting commentary through Informal Opinion 1850, the committee noted one purpose is to keep the client and the third party from depriving the lawyer of an ordinary benefit of representation, future business, when the lawyer may be in a vulnerable bargaining position.

Background and rules framework

The opinion interprets Washington RPC 5.6(b) (the counterpart to Model Rule 5.6(b)), which prohibits a lawyer from participating in offering or making an agreement in which a restriction on the lawyer's right to practice is part of the settlement of a client controversy. The committee relied on its prior Informal Opinion 1850 (1999), which analyzed a closely similar settlement restriction and the rationale behind RPC 5.6(b).

Citations and references

Rules of Professional Conduct:

• Model Rule 5.6 / Washington RPC 5.6, 5.6(b) (restriction on a lawyer's right to practice as part of settling a client controversy)

Other opinions cited:

• WSBA Informal Opinion 1850 (1999) (settlement restriction on a plaintiff's attorney's right to practice)

Other authorities cited:

• G. Cohen, "When Law and Economics Met Professional Responsibility," 67 Fordham L. Rev. 273 (1998) (quoted through Informal Opinion 1850)

See also

• WA Ethics Op. 1850: Practice Limits in Settlements
• WSBA Ethics Op. 988: Settlement Bar on Suing Again
• ABA Formal Op. 93-371: Restrictions on Representing Future Clients

Source

• Landing page: https://ao.wsba.org/print.aspx?ID=1561

Original opinion text

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

Advisory Opinion: 2125
Year Issued: 2006
RPC(s): RPC 5.6(b)
Subject: Clause in settlement agreement preventing plaintiff`s attorney from filing additional unrelated suits against defendant on behalf of currently unidentified plaintiffs

Facts The Inquirer asks whether a clause may be included in a settlement agreement which prevents plaintiff’s attorney from filing additional unrelated suits on behalf of currently unidentified plaintiffs against the same defendant.

Response Background In the course of settlement negotiations defendant’s attorney suggests to plaintiff’s attorney that a clause be included in a settlement agreement which prevents plaintiff’s attorney from filing additional unrelated suits on behalf of currently unidentified plaintiffs against the same defendant. General rule The rule on point is RPC 5.6 (b). That rule states: “a lawyer shall not participate in offering or making:…(b) an agreement in which a restriction on the lawyer’s right to practice is part of the settlement of a client controversy.” In Washington State Bar Association informal opinion number 1850 (1999) a very similar issue was addressed. In that informal opinion, the purpose for and criticism of RPC 5.6 (b) was summarized with a quotation: “ ‘The purported purpose of this heavily criticized rule is to make legal services available to more people. But another possible purpose for the rule is to prevent the client and the third party from opportunistically taking advantage of the lawyer by depriving the lawyer of one of the ordinary benefits of representation – future business – at a time when the lawyer might be in a vulnerable bargaining position.’ G. Cohen, “When Law and Economics Met Professional Responsibility, “ 67 Fordham L. Rev. 273, 283 (1998).” The informal opinion also deals with the plaintiff attorney’s non-solicitation of future clients. It states: “RPC 5.6 precludes a settlement offer or agreement that would restrain plaintiff’s attorney from lawful solicitation of future clients in similar litigation involving the subject matter of the initial case. However, as discussed below, the use of information by the attorney from the prior case may be restricted.”

Conclusion It does constitute a violation of Washington State RPC 5.6 (b) for plaintiff’s attorney to enter into a settlement agreement which restricts or prevents that attorney from filing additional unrelated suits on behalf of currently unidentified plaintiffs against the same defendant. The Committee is of the opinion that neither plaintiff nor defendant should enter into such a settlement agreement based on RPC 5.6 (b) and informal opinion 1850.