Law and Ethics of Lawyering (Law 473)
Marquette University Law School
This exam has 5 questions with a total time limit of 2 hours, 45 minutes. Questions 1 and 2 (35 minutes each) are each worth 23.3% of the final score, Question 3 (30 minutes) is worth 20% of the final score, and Questions 4 and 5 (25 minutes each) are each worth 16.7% of the final score. You should allocate your time accordingly. I have also given you 15 minutes of additional “discretionary” time to use as you see fit (ideally not to write unorganized thoughts!).
This is an “open book” exam, meaning that you may use any written material you want. However, in answering this exam, you may not discuss it or your answer with anyone.
In any question where you believe that a client waiver or consent is appropriate, you must also discuss the specific details you would include in the waiver to get the requisite consent, such as the actual and reasonably foreseeable consequences to the client of granting the consent.
I have the following additional thoughts for you:
- Bullet points are OK
- Short citation forms are OK
- You can use abbreviations if you define them and they are not ambiguous
- Please quote rules only as necessary to make your point
Good luck and have a wonderful holiday season!
DO NOT TURN THIS PAGE UNTIL INSTRUCTED TO DO SO!
Question 1 (35 minutes)
First law firm represented Newco as its outside general counsel from corporate formation through several rounds of financing. During this representation, First made several corporate law errors, which First tried to correct. Newco eventually terminated First’s representation out of frustration and retained Second law firm as its outside general counsel.
Two years after switching law firms, Newco is negotiating to be bought by Acquireco. Second will represent Newco in the acquisition. Acquireco has used First law firm on many previous acquisitions and would like to retain First to represent Acquireco in the Newco acquisition. Note that any law firm representing Acquireco in the acquisition will review Newco’s corporate records and documentation to look for irregularities that may impair Newco’s value.
Can First take on the representation? From Newco’s perspective, enumerate pros and cons arising from First representing Acquireco in the acquisition.
Question 2 (35 minutes)
Under Delaware law, board of directors can approve official corporate actions (like issuing stock) either in a meeting or by written consent. Because sometimes arranging board meetings can be expensive and time-consuming, companies often use the written consent approach. To do so, all board members must execute their consents within 30 days of each other. Otherwise, the consent fails and either new consents must be requested (an annoying and costly duplication of effort) or a meeting held. Corporate actions implemented without proper board authorization are void.
Often, directors are busy individuals who do not return consents on time. As a result, many lawyers instruct directors not to date the signed consents. That way, the lawyer can fill in the dates of the consents when all consents have been returned, thus ensuring that all consents have dates within 30 days of each other (even if the consents were, in fact, executed more than 30 days apart).
Does this practice comply with the WI Rules of Professional Conduct? Would you engage in this practice? Can you reduce any associated risks?
You represent both Bigco and Smallco, companies that manufacture and sell identical widgets but have different customer bases and thus are not direct competitors. Bigco asks you to prepare a form contract for the sale of its widgets, which it wants to keep confidential (i.e., the contract will be provided to customers only under a confidentiality agreement). Smallco knows that you drafted Bigco’s form sales contract and would like you to prepare a form sales contract for Smallco using Bigco’s form as the starting point.
Can you do so? If not, what can you do, and what consequences do you expect from either path?
You are Acme’s in-house attorney. Acme asks you to identify legal risks associated with a new business initiative, Project Omega. After your review, you believe that Omega exposes Acme to business-threatening tort risks and there are no effective ways to mitigate those risks. Therefore, you advise Jill, Acme’s CEO, not to proceed. Jill reviews your report but decides to proceed anyway based on her assessment of business benefits and legal risks.
Nevertheless, Jill wants to brief Acme’s board of directors on Omega and asks you to participate in that meeting. Jill stresses that Acme’s management team must present a “united front” to the directors. Therefore, Jill instructs you to discuss only the (largely ineffectual) risk mitigation steps Acme will take, not your fundamental concerns about proceeding with Omega.
What must you do? Would you prefer to do something different? What consequences would you expect from either path?
Jane, a Corpco employee, is your primary day-to-day client contact for Corpco legal matters. To foster good client relations, you and your spouse go on a “double-date” with Jane and her spouse. While most of the dinner is spent socializing, after dinner Jane says she has a quick legal question.
From a professional responsibility perspective, what concerns should you have about Jane’s impending question? What should you do? What are you likely to do (if different)?
END OF EXAM