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AIRPORT LEGAL ETHICS

PART 1 – ETHICAL DILEMMAS:

A PROCESS FOR DECISION-MAKING

PART 2 – THE ETHICAL TRIO PRESENTS:

MEGAPORT’S LATEST ETHICAL CRISIS

ACI-NA SPRING LEGAL AFFAIRS CONFERENCE –

APRIL 7, 2014 DALLAS, TEXAS

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ACI-NA SPRING LEGAL AFFAIRS CONFERENCE –

APRIL 7, 2014 DALLAS, TEXAS

AIRPORT LEGAL ETHICS

PRESENTERS:

HELEN E. BERKMAN, DENVER INTERNATIONAL AIRPORT

TIMOTHY R. KARASKIEWICZ, GENERAL MITCHELL

INTERNATIONAL AIRPORT, MILWAUKEE, WI

DAVID S. MACKEY, ANDERSON & KREIGER

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ACI-NA SPRING LEGAL AFFAIRS CONFERENCE –

APRIL 7, 2014 DALLAS, TEXAS

AIRPORT LEGAL ETHICS

PART 1 – ETHICAL DILEMMAS:

A PROCESS FOR DECISION-MAKING

I.

Using the Rules of Professional Conduct

– Rule 1.2 Scope of Representation – Rule 1.4 Communication

– Rule 1.6 Confidentiality – Rule 1.7 Conflict of Interest – Rule 1.13 Organization as Client – Rule 2.1 Advisor

– Rule 4.1 Truthfulness in Statements to Others – Rule 8.4 Misconduct

(4)

ACI-NA SPRING LEGAL AFFAIRS CONFERENCE –

APRIL 7, 2014 DALLAS, TEXAS

AIRPORT LEGAL ETHICS

PART 1 – ETHICAL DILEMMAS:

A PROCESS FOR DECISION-MAKING

II.

How to Help the Client Decide

Using the Socratic method Identify the Goals

Communicate to Solve Problems

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ACI-NA SPRING LEGAL AFFAIRS CONFERENCE –

APRIL 7, 2014 DALLAS, TEXAS

AIRPORT LEGAL ETHICS

PART 1 – ETHICAL DILEMMAS:

A PROCESS FOR DECISION-MAKING

III.

How to Help Yourself Decide –

A. Utilize the 4 P’s

Right Use of People

Right Use of Power

Right Use of Property

Interest of Public

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ACI-NA SPRING LEGAL AFFAIRS CONFERENCE –

APRIL 7, 2014 DALLAS, TEXAS

AIRPORT LEGAL ETHICS

PART 1 – ETHICAL DILEMMAS:

A PROCESS FOR DECISION-MAKING

III.

How to Help Yourself Decide – (cont’d)

B. Ask yourself questions

What are the core issues

What are the facts

Where do your loyalties lie and what duties do you owe to each

person

Create at least three alternative courses of action and weigh pros

and cons

Defend your choice to your mentor

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ACI-NA SPRING LEGAL AFFAIRS CONFERENCE –

APRIL 7, 2014 DALLAS, TEXAS

AIRPORT LEGAL ETHICS

Side Bar – since you’ve all been wondering….

RULE CHANGE 2014(05) (the “marijuana rule”) Colorado Rules of Professional Conduct

Rule 1.2. Scope of Representation and Allocation of Authority Between Client and Lawyer New Comment [4] added:

[4] A lawyer may counsel a client regarding the validity, scope, and meaning of Colorado constitution article XVIll, secs. 14 & 16, and may assist a client in conduct that the lawyer reasonably believes is permitted by these constitutional provisions and the statutes,

regulations, orders, and other state or local provisions implementing them. In these circumstances, the lawyer shall also advise the client regarding related federal law and policy.

Amended and Adopted by the Court, En Banc, March 24, 2014, effective immediately. Justice Coats and Justice Eid would not approve Comment [4].

By the Court: Nancy E. Rice, Chief Justice

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MEGAPORT: POLITICS, PAYBACK, AND PARTICIPATION

The players:

MegaPort – an Airport Authority with a 7 member Board of

Directors

Board Chair

Governor (just re-elected)

CEO of Megaport (your main client rep) CFO of Megaport (also a main client rep) General Counsel of Megaport (that’s you)

(9)

MEGAPORT: POLITICS, PAYBACK, AND PARTICIPATION – HYPOTHETICAL SCENARIOS

1. The Chief Financial Officer comes into your office the afternoon after the staff meeting and says “you know, I’m worried about the revised schedule for the runway project they’re bringing to the Board next week. I’ve run the numbers – we’re not saving any money, it’s actually going to cost more. I hear from the Director of Aviation that closing that runway for six months, including on the busiest travel days of the week, could involve massive air traffic delays. And the noise over West Town will be brutal. Can you help me figure out why we’re doing this?” You respond:

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MEGAPORT: POLITICS, PAYBACK, AND PARTICIPATION a. “No, I only deal with legal issues, not financial or

operational issues. You’re on your own.” Comment 3 to ABA Model Rule 1.13 --- decisions by corporate officers “must be accepted by the lawyer even if their utility or prudence is doubtful. Decisions concerning policy and

operations, including ones entailing serious risk, are not as such in the lawyer’s province.”

b. “No. Under ABA Model Rule 2.1, Comment 5, I have ‘no duty to initiate investigations of a client’s affairs.’”

c. “No, only if you have evidence that the plan is illegal.” d. “Sure, I’m a little bit curious myself about the revised schedule…” Model Rule 2.1 -- advice to client based on

(11)

MEGAPORT: POLITICS, PAYBACK, AND PARTICIPATION

2. You choose option (a) and decide not to get involved. But

the next day the CEO wants to see you on “a top priority”.

You’re waiting outside his office and overhear him saying, “It’s going to cost us a bundle, and we’ll probably see some major delays, especially on peak travel days and holidays, but I know, we’ve got to make it happen. Don’t worry.” CEO wants you to draft the Board vote and the justification memo to the Board for the revised runway project. He says “I know you can make it persuasive… you’ll come up with something.” Other than that he offers no specifics, and ushers you out when you begin to ask questions. You should:

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MEGAPORT: POLITICS, PAYBACK, AND PARTICIPATION

a. Refuse to draft the memo and Board vote --- might involve wrongful conduct prohibited by ABA Model Rule 1.2(d).

b. Withdraw from involvement in the matter under ABA Model Rule 1.16(a) (mandatory withdrawal), and delegate the drafting to your Deputy.

c. Draft the memorandum and Board vote, with an impassioned statement of the supposed economic development benefits of the revised schedule, even though you have no facts to support that

statement, and even though you have misgivings about the motivation for the accelerated schedule.

d. Inform the CEO that before you begin drafting, you will need to work closely with the CFO and Airport Director to develop the

(13)

MEGAPORT: POLITICS, PAYBACK, AND PARTICIPATION

3. You choose option (c) and submit the memo and vote for inclusion

in the Board agenda. But then the CFO comes back to your office. He looks pale, and has a print-out of an e-mail from the Governor’s top lawyer to the Governor herself captioned “Confidential-Attorney-Client Privilege”, but it was mis-addressed to the MegaPort CFO (who shares the Governor’s last name). It reads: “Governor, I’ve given

careful thought to your plan to teach those voters in West Town a lesson. I’ve done some research: punishing West Town for

supporting your opponent would violate state and federal law, so you need to cover your tracks carefully. The plan only works if you can get those folks at MegaPort to come up with some justification on the revised runway schedule --- justification that holds water. The CEO’s on board, and they’ve got smart lawyers over there, they’ll think of something.” What do you do with the e-mail?

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MEGAPORT: POLITICS, PAYBACK, AND PARTICIPATION

a. Under ABA Model Rule 4.4(b), you destroy the e-mail. We all make mistakes like that. The poor guy meant to send it to his client, the Governor.

b. Under ABA Model Rule 4.4(b), you notify the Governor’s top lawyer that he mistakenly sent the e-mail to MegaPort. c. Under ABA Model Rule 4.4(b), you notify the Governor’s top lawyer that he mistakenly sent the e-mail to MegaPort, and you follow his instructions about what to do with it. d. You send the e-mail to the U.S. Attorney. It’s evidence of a crime.

(15)

MEGAPORT: POLITICS, PAYBACK, AND PARTICIPATION

4.

You choose option (a), but you are sensitive to

ethical improprieties, and you believe the e-mail

clearly reflects that the Governor’s top lawyer has

committed a violation of the ABA Model Rules. Under

ABA Model Rule 8.3, you are required to:

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MEGAPORT: POLITICS, PAYBACK, AND PARTICIPATION

a. Call him and tell him you will report him to the state’s

professional disciplinary authority, unless he can

convince the Governor to abandon her pay-back

scheme.

b. Report him to your state’s professional disciplinary

authority.

c. Keep the matter quiet, because if you report him, you

will have to disclose your own CEO’s involvement, and

that is a client confidence protected by Rule 1.6.

d. Keep the matter quiet. You think “snitching” on

fellow lawyers is distasteful, and you’ve got enough

(17)

MEGAPORT: POLITICS, PAYBACK, AND PARTICIPATION

5.

You choose option (c) and keep it quiet. The revised

runway schedule is going to the Board the next day.

You now know that this whole crazy scheme is illegal,

political payback. What do you do?

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MEGAPORT: POLITICS, PAYBACK, AND PARTICIPATION

a. Discuss the matter with the CEO, and try to

change his mind about the project.

b. Discuss the matter directly with the Chair and

the other members of the Board, and argue they

should vote against the revised schedule.

c. Blow the whistle on the whole scheme. Send a

copy of the e-mail to the media and to the U.S.

Attorneys’ Office. It’s obviously all about political

payback.

(19)

MEGAPORT: POLITICS, PAYBACK, AND PARTICIPATION

6. You choose option (a), and try to talk to the CEO out of

bringing the matter to the Board. You tell him that you think the revisions to the runway schedule are a terrible idea, could cause MegaPort grave harm, and that if it’s being done to

retaliate politically, it’s downright illegal. The CEO won’t relent, and disinvites you to tomorrow’s board meeting. “You’re

taking a sick day,” he says. What do you do?

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MEGAPORT: POLITICS, PAYBACK, AND PARTICIPATION

a.

Nothing, the CEO made up his mind. You’ve done your best.

b. Report the matter to the Board, and urge it to vote against the proposal.

c. Report the matter to law enforcement.

d. Sell your condo in West Town before the revised schedule’s made public.

(21)

MEGAPORT: POLITICS, PAYBACK, AND PARTICIPATION

7.

You choose option (b), and talk to the Board

members by phone the night before the meeting.

They each listen carefully, but you learn the next day

that the Board authorized the revised schedule, with

no discussion. You should:

(22)

MEGAPORT: POLITICS, PAYBACK, AND PARTICIPATION a. Accept the Board’s decision and follow your

client’s instructions. You did your best to talk them out of this, but they decided to vote for the revised schedule anyway.

b. Call the Governor directly, and make one last

appeal, directly to her, to get her Board appointees to give up this crazy scheme.

c. Call the U.S. Attorney’s Office and the media and put a stop to the project.

d. Withdraw from the matter under ABA Model Rule 1.16(a).

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MEGAPORT: POLITICS, PAYBACK, AND PARTICIPATION

8. You choose option (a), decide to accept the Board’s decision, and remain as General Counsel. The Concerned Citizens

Committee (“CCC”) of West Town is up in arms. The CEO directs you, as General Counsel, to represent MegaPort at a meeting of the CCC to discuss the financial and operational

benefits of the revised schedule, even though nobody can think of any (and even though you know that the whole thing is just political payback). You attend the meeting, and boldly predict to the West Town CCC that they’ll “hardly notice a thing,” as large commercial jets just clear their rooftops, twenty-four hours a day, seven days a week, for six months. You have:

(24)

MEGAPORT: POLITICS, PAYBACK, AND PARTICIPATION

a. Violated ABA Model Rule 1.2(d), by facilitating

fraudulent or criminal activity.

b. Violated ABA Model Rule 4.1 – “truthfulness in statements to others.”

c. Violated ABA Model Rule 8.4(c) – “conduct involving dishonesty, fraud, deceit or

misrepresentation.”

d. Represented your client with “commitment”, “dedication” and “zeal” as required by ABA Model Rule 1.3, Comment 1.

(25)

MEGAPORT: POLITICS, PAYBACK, AND PARTICIPATION

9. A member of the Governor’s staff, who’s also a member of the West Town CCC, drops a dime. The next day you receive a telephone call from the U.S. Attorney. He tells you that the

CEO is under criminal investigation for conspiring to punish the citizens of West Town for voting for the Governor’s opponent. He says that you cannot tell anybody, especially the CEO and your Board, because that might end up obstructing the

investigation. You respond:

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MEGAPORT: POLITICS, PAYBACK, AND PARTICIPATION

a. Tell the Board about the investigation of the CEO, because you have an absolute duty to communicate relevant information to your client under Rule 1.4. b. Tell the CEO, because you have an absolute duty to communicate relevant information to your client under Rule 1.4, and if you give him a heads-up, he might be able to shred incriminating documents. c. Obey the U.S. Attorney’s request, because it is in the best interests of the organization to do so.

(27)

MEGAPORT: POLITICS, PAYBACK, AND PARTICIPATION

10. You choose option (b). When you arrive in the CEO’s office and tell him about the call from the U.S. Attorney, he closes the door, and says to you “there are a few things I need to tell you in confidence. Just between you and me right? I know you won’t let me down.” You respond:

(28)

MEGAPORT: POLITICS, PAYBACK, AND PARTICIPATION

a. “I won’t let you down. I’m your lawyer and this is a privileged conversation.”

b. By saying nothing, and by taking careful notes of what the CEO tells you.

c. “I represent MegaPort, not you, and I may have to tell others about this conversation.”

d. “I represent MegaPort, not you. I may have to tell others what you tell me, and I advise you to seek

your own counsel, immediately, before you say anything.”

(29)

MEGAPORT: POLITICS, PAYBACK, AND PARTICIPATION

11. You choose option (a). The CEO then directs you to hire an

outside law firm to conduct an in-depth, independent

investigation, and to publish a written report which will clear his “good name once and for all.” You respond by saying:

(30)

MEGAPORT: POLITICS, PAYBACK, AND PARTICIPATION

a. “Sounds good boss, and we’ll guide their work

carefully. We don’t want them talking to the CFO or the Aviation Director, just the people we pick.”

b. “Sounds good boss. We’ll pick the firm that already gets most of our work. I’ll make them understand that if this report doesn’t come out looking good for you, they’ll never see a penny of work from MegaPort again.”

c. “Sounds good boss, and let’s try to find someone with an axe to grind with the Board or the

(31)

MEGAPORT: POLITICS, PAYBACK, AND PARTICIPATION

12. The Board Chair asks you to represent him in the grand jury

proceedings (to which he’s just been subpoenaed). Under ABA Model Rule 1.7, you

(32)

MEGAPORT: POLITICS, PAYBACK, AND PARTICIPATION a. Can represent the Chair;

b. Can only represent the Chair with the consent of the other members;

c. Can represent the Chair because his interests will be aligned with MegaPort’s;

d. Cannot represent the Chair, because your own

(33)

MEGAPORT: POLITICS, PAYBACK, AND PARTICIPATION

13. You’ve been indicted and convicted for various crimes

stemming from the scandal. You decide to try to minimize the sentence by offering a statement to the U.S. Attorney that

divulges attorney-client communications between you and the Board members, when you tried to dissuade them from the pay back plan. You think it will really help the U.S. Attorney’s cases against the Board members.

(34)

MEGAPORT: POLITICS, PAYBACK, AND PARTICIPATION

a. You cannot do so, because it would constitute the disclosure of client confidences under ABA Model Rule 1.6.

b. You can do so, because you are defending yourself in a criminal proceeding.

c. You can do so, because you were disbarred six months ago, and don’t really care about the ABA Model Rules anymore.

(35)

QUESTIONS? COMMENTS?

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