Another Court Analyzes the Identity of a Lawyer’s Client

October 14, 2009

Although it seems like such a basic concept, some lawyers run into trouble because they have not defined their “client” specifically enough. This issue frequently arises when lawyers work for closely held companies.

In MacKenzie-Childs LLC v. MacKenzie-Childs, No. 06-CV-6107T, 2009 U.S. Dist. LEXIS 71777 (W.D.N.Y. Aug. 14, 2009), two individuals owned a company which eventually declared bankruptcy, and whose assets were sold to various successors who continued the business. During a later trademark fight between the individuals and one of the successors, the individuals sought documents from the lawyer who formerly represented their company. They claimed that the lawyer obviously represented them too, because they owned the company. However, the court rejected this argument. It noted that the lawyer had never even spoken to the individuals, and had received payment from the company rather than from them. The court ultimately found that the privilege had passed to the various successor companies, meaning that the individuals could not obtain the lawyer’s files.

The analysis would have been much easier if the lawyer had specifically explained in a retainer letter that he represented the company and not the individual owners (although one certainly can understand why a lawyer in that circumstance would not want an ugly disclaimer to that effect).