Unethical To Enter Confidential Settlement And Not Disclose Terms To Clients

An attorney represented a neighborhood group that included 64 individuals in connection with damages to houses and personal injuries caused by an explosion at a plant.

The attorney learned at a deposition that ten of the clients already had settled their claims.

When a global settlement was reached, the attorney failed to advise the clients of all aspects of the resolution and took it upon herself to devise (and not disclose) her formula or determining the distribution of proceeds.

She contended that the terms of the settlement were conidential in justifying the non-disclosure to the clients.

The Indiana Supreme Court rejected the confidentiality defense and imposed a public reprimand.The court accepted the hearing officer’s conclusion that the representation of both settling and non-settling clients violated conflict of interest rules.

The Disciplinary Commission had sought a suspension.

The court noted that the attorney had a spotless disciplinary record and that the clients expressed gratitude for her efforts. (Mike Frisch)