Concurrent Conflicts of Interest: ABA Model Rule 1.7 Explain...

Introduction

Concurrent conflicts of interest are a daily risk in law practice, from intake to closing. Under ABA Model Rule 1.7, a lawyer may not represent a client if the representation is directly adverse to another current client or if there is a significant risk the representation will be materially limited by duties to another client, a former client, a third person, or by the lawyer’s own interests.

This guide translates Rule 1.7 into practical steps with common red flags, real-world examples, and quick checklists designed for U.S. practitioners and law students.

What You’ll Learn

• What qualifies as a concurrent conflict under Rule 1.7
• The difference between “direct adversity” and “material limitation”
• When client consent can solve a conflict—and when it can’t
• How firm-wide imputation works and when screening helps
• Case studies: Fiandaca v. Cunningham and In re A.H. Robins Co., Inc.
• Remedies and risks: disqualification, discipline, fee issues
• Practical steps for conflict checks, disclosures, and documentation

Core Concepts

What Is a Concurrent Conflict under Rule 1.7?

A concurrent conflict exists if either condition applies:

• Direct adversity: The representation of one client is directly adverse to another current client.
• Material limitation: There is a significant risk that your duties to a current client, a former client, a third person (like an insurer), or your personal interests will materially limit your representation of another current client.

Key points to keep in mind:

• Unrelated matters can still be “directly adverse.” Representing Client A in suing Company X while your partner represents Company X in an unrelated deal is still adverse.
• “Significant risk” means more than a remote or speculative chance of limitation. If your judgment or loyalty could realistically be pulled in two directions, you have a problem.
• Joint representations are especially sensitive. Clients negotiating with each other, co-defendants with different exposure, or multiple family members often present material-limitations risks.
• Corporate clients include constituents. Representing a corporation while advising officers, directors, or employees can trigger conflicts if interests diverge.
• Third-party payors add complexity. If an insurer or parent company pays fees, confirm that your duty of loyalty, confidentiality, and independent judgment remain intact.

When Consent Can Cure—and When It Can’t

Rule 1.7(b) allows representation despite a concurrent conflict only if all of the following are true:

• You reasonably believe you can provide competent and diligent representation to each affected client.
• The representation is not prohibited by law.
• The representation does not involve asserting a claim by one client against another client in the same litigation or other proceeding before a tribunal.
• Each affected client gives informed consent, confirmed in writing.

What “informed consent” should cover:

• The nature of the conflict and how it could affect the representation
• The material risks and reasonably available alternatives (including the option to seek independent counsel)
• Any limitations on the scope of your representation necessary to address the conflict

Nonconsentable conflicts:

• Opposing current clients in the same litigation or contested proceeding
• Situations where a reasonable lawyer would not believe competent and diligent representation is possible for each client

Imputation to the Firm and Screening Basics

• General rule (Model Rule 1.10): A conflict held by one lawyer is imputed to the entire firm, meaning no lawyer in the firm may undertake the representation unless the conflict is cured (usually with proper consent) or an exception applies.
• Personal-interest conflicts: Some purely personal-interest conflicts may not be imputed if they do not present a significant risk of materially limiting the representation of the client by the remaining lawyers in the firm.
• Screening: Screening generally does not cure a concurrent conflict for current clients, but it can help with certain former-client conflicts and lateral moves under the imputation rules. Check your jurisdiction’s version of Rules 1.10 and 1.11.

Common Red Flags

• Suing a current client in any matter (even unrelated)
• Representing multiple parties in a negotiation or deal
• Representing corporate affiliates where adversity may arise
• Coverage counsel paid by an insurer with potential reservation-of-rights issues
• Joint defense arrangements with differing litigation strategies or settlement goals
• Lawyer’s personal financial interests or board service affecting professional judgment
• Lateral hires bringing in matters adverse to existing clients

Key Examples or Case Studies

Legal examples

Example 1: Representation in competing litigation

• Scenario: You represent Client A in a lawsuit against Company X. A colleague in your firm takes on Company X in a separate matter.
• Conflict type: Direct adversity between current clients.
• Risk: Divided loyalty, use or misuse of confidential information, disqualification of the firm.
• Possible path forward: Decline one matter, seek informed consent from both clients if Rule 1.7(b) can be satisfied, or withdraw from one representation if feasible and permitted.

Example 2: Business deal between two existing clients

• Scenario: You represent two clients negotiating a transaction with each other.
• Conflict type: Material limitation risk—your independent judgment may be pulled in two directions.
• Risk: Inability to advocate for best terms for each side, potential confidentiality issues.
• Possible path forward: Assess if a reasonable lawyer could competently and diligently represent both. If yes, consider informed consent, confirmed in writing, and clearly define scope and information-sharing. If not, refer one party to separate counsel.

Cases involving concurrent conflicts

Fiandaca v. Cunningham

• Context: A firm represented a class of women prisoners seeking improved conditions while also representing the state in another matter.
• Holding: The court found a concurrent conflict because the interests of the prisoner class and the state were directly adverse.
• Lesson: Even if matters are not identical, representing opposing sides on related public-institution issues can create direct adversity and undermine client trust.

In re A.H. Robins Co., Inc.

• Context: A firm represented a debtor in bankruptcy while defending a trustee in a related adversary proceeding.
• Holding: The court found a concurrent conflict due to materially adverse responsibilities to two different clients within related proceedings.
• Lesson: Bankruptcy and other multi-party proceedings require extra attention to overlapping roles, duty of loyalty, and confidentiality across related matters.

Practical Applications

Conflict checks that work

• Build a robust conflict database: Include clients, former clients, affiliates, officers, directors, trade names, insurers, and key counterparties.
• Ask better intake questions: Identify all parties, potential cross-claims, financing sources, and likely future adversity (e.g., related subsidiaries).
• Check at key moments: New matter, new party, change in ownership, amended pleadings, new claims, or when a lateral joins.
• Watch affiliates: Confirm whether a waiver covers parents, subsidiaries, and commonly controlled entities.

Consent and documentation

• Give clear disclosures: Explain the conflict, risks, and alternatives in plain English. Note any limits on information sharing and the scope of representation.
• Confirm in writing: Obtain informed consent from each affected client, signed when possible. Store consents with the engagement letter or as a separate letter.
• Consider advance waivers: In appropriate settings, a general future-conflict waiver may be acceptable if the disclosure is specific enough and the client is sophisticated; confirm your jurisdiction’s requirements.

Managing active matters

• Separate teams where appropriate: If the conflict is consentable, consider separate matter teams and need-to-know access to reduce risk of material limitation.
• Set guardrails: Clarify in writing who is the client, what information will be shared, and how disagreements will be handled.
• Monitor throughout: Conflicts are not one-and-done. Reassess at major case milestones and when facts change.

When to step back

• If consent is not possible or not allowed, decline or withdraw promptly, consistent with Rule 1.16 and court rules.
• Protect confidentiality on withdrawal. Coordinate a clean handoff and address the client’s immediate needs to avoid prejudice.

Consequences and remedies

• Disqualification: Courts can remove conflicted counsel or the entire firm.
• Discipline: State bars can impose sanctions for ethics violations.
• Fee risk: Fees may be reduced, forfeited, or disgorged.
• Civil exposure: Clients may bring malpractice or breach-of-fiduciary-duty claims.

Related ethics topics to review

• Withholding Information From Client
• Notice of Withdrawal
• Transactions Between Client and Lawyer
• Business Affairs of Lawyer
• Law Partnership

Note: The ABA Model Rules are widely used, but states may have variations. Always check your jurisdiction’s rules and opinions.

Summary Checklist

• Identify direct adversity and material limitation risks at intake and throughout the matter.
• Confirm whether the conflict is consentable under Rule 1.7(b).
• Provide full, plain-English disclosures of risks and alternatives.
• Obtain informed consent, confirmed in writing, from each affected client.
• Avoid representing opposing current clients in the same proceeding.
• Consider separate teams, clear scopes, and information barriers where appropriate.
• Re-run conflict checks when parties or claims change, or when a lateral joins.
• If consent is not available or conditions are not met, decline or withdraw.
• Document everything: checks run, disclosures given, consents received, and decisions made.
• Review imputation and screening rules (Model Rules 1.10 and 1.11) for firm-wide impact.

Quick Reference