Client-imposed terms through outside counsel guidelines are an ever-growing concern, particularly as they may widen the scope of individuals and entities against whom the firm agrees not to act. The risk is enhanced because terms may be imposed through the ‘back door’ through e-billing arrangements which lead to accounts staff inadvertently accepting changed terms of business.
The case of Falk Pharma GMBH v. Generico, LLC 2019 WL 692670 (Fed. Cir. Feb. 20, 2019) demonstrates that the risk is not purely theoretical. The court disqualified lawyers from acting against a client’s ‘affiliates’. However, given that the company in question was a subsidiary of the client with which it shared a legal department, the result is perhaps not too surprising. See www.legalrisk.co.uk/conflicts.
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