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After а third cоmplаint аbоut hоw her company was handling customer service requests, the owner-operator developed a code of ethics to specify
Dаvis, а seniоr technicаl engineer at Apex Dynamics, Inc., was оn maternity leave when she was terminated оne week before her scheduled return. She had worked at Apex for seven years. No reason was given for her termination.Believing her termination was unlawful and discriminatory, Davis retained Attorney Smith to represent her in a civil action against Apex. Apex retained Attorney Grant to defend the company. Grant informed Smith that he represents Apex and its senior management employees in connection with this matter and in their official capacities.Shortly thereafter, without notifying Attorney Grant, Attorney Smith contacted Park, Apex’s Senior Vice President of Human Resources, and invited him to lunch. Smith and Park were social acquaintances, and Smith knew Park was planning to retire within a few months. Park had primary responsibility for employee terminations at Apex, including Davis’s termination. Smith asked Park about Apex’s termination practices, his role in Davis’s firing, and whether he had discussed the matter with company counsel. During the conversation, Park stated that Apex believed Davis had removed a company-issued thumb drive containing proprietary and highly confidential information while on leave. All Apex employees were required to sign a non-disclosure agreement prohibiting removal or external use of such materials, and Davis had signed that agreement.Smith later relayed this information to Davis. Davis admitted that she had taken the thumb drive as “insurance” in case her lawsuit was unsuccessful. She further stated that she did not intend to return to Apex, had been interviewing with competitors for over a year, and had referenced the proprietary information in those discussions. Davis then told Smith that she planned to continue using the information during upcoming interviews and intended to provide portions of the data to a prospective employer within the week. She also stated that she was relying on Smith’s representation in this lawsuit to “buy time” so Apex would not pursue her while she secured a new position.Smith, who had experience with trade secret matters, recognized that this conduct could implicate federal criminal law, including the Economic Espionage Act, but did not provide Davis with any legal advice regarding this issue and did not attempt to dissuade her.After some fruitless settlement discussions were held between Smith and Grant, Smith filed suit on behalf of Davis.The case proceeded to discovery. During her deposition, Davis testified that she had been a loyal employee who intended to return to Apex after her leave. She denied taking any thumb drive or possessing any confidential company information. She further stated that Apex’s accusations were false and suggested she might pursue a defamation claim. Smith was present throughout the deposition and did not take any steps to correct Davis’s testimony.Following the deposition, Attorney Grant informed Smith that Apex was willing to settle the matter for $100,000, conditioned on a mutual release and a confidentiality agreement, noting the company lacked definitive proof regarding the alleged removal of confidential materials. Without consulting Davis, Smith immediately accepted the offer and signed the settlement agreement on Davis’s behalf. Smith informed Davis of the settlement later that evening. Davis objected strongly to both the amount and the fact that the settlement had been accepted without her consent.Please identify and analyze all ethical concerns you have with Attorneys Smith and Grant under the Ohio Rules of Professional Conduct. Make sure to address the following specific issues: Smith's meeting with Apex Senior Vice President of Human Resources. Smith's confidential discussions with client Davis prior to litigation commencing. Smith's actions after litigation commenced. What sanctions, if any, would be appropriate if Attorney Smith were subject to disciplinary proceedings? Under what standards and why ?