Ethics in Brief: Caputo – A Cautionary Tale with Costly Consequences

By Valerie Silverman Massey 

Scenario: As a senior or supervising attorney, you are preparing to file a document with a court. A more junior attorney prepares the document using prior office writings/research or conducting new research and preparing the document from scratch. Your name is on the caption and the signature line. 

Question: How thoroughly did you review, research, or investigate the information being submitted to the court? Can you be held personally responsible for any inaccuracies? 

Answer: Quite possibly!

The Ninth Circuit recently addressed this issue in Caputo v. Tungsten Heavy Powder, Inc., (9th Cir. 2024) 96 F. 4th 1111. Caputo Court ruled on a motion for sanctions for attorney misconduct which “multipli[ed] the proceedings … unreasonably and vexatiously” which resulted in excessive costs, expenses, and attorney fees under 28 U.S.C. §1927 by bringing an improper motion for reconsideration. The motion for reconsideration, written by a junior attorney, and signed by a senior attorney, was premised on “newly discovered evidence that, with reasonable diligence, could not have been discovered in time to move for a new trial.” Fed. R. App. P. 60(b)(2). The alleged evidence was not “new.” However, the senior attorney blindly accepted the facts and arguments asserted by a junior attorney without performing any independent verification of the facts or the law. The Court ruled a review of the client documents and related legal actions or cursory legal research would have identified the frivolity of the asserted position and motion. The Court awarded sanctions not just against the client, but also personally against numerous lawyers involved in the litigation. 

Consistent with United States Supreme Court direction, the Ninth Circuit found that attorneys demonstrate “conduct unbecoming of the court’s bar” when they violate applicable rules of professional conduct. In re Snyder, 472 U.S. 634, 645 n. 6 (1985; see In re Girardi, 611 F.3d 1027, 1035 (9th Cir. 2010). In Caputo, the Court determined that counsel’s conduct also amounted to a violation of California Rule of Professional Conduct Rule (“Rule”) 3.3 (Candor Toward the Tribunal: “A lawyer shall not: (1) knowingly make a false statement of fact or law to a tribunal or fail to correct a false statement of material fact or law previously made to the tribunal by the lawyer[.]” Cal. Rules of Professional Conduct, Rule 3.3 (a)(1).  

The Court specifically ruled that a supervising attorney has an affirmative professional obligation to ensure that the claims before the Court were not frivolous, especially considering the level of inexperience of the junior lawyer.Caputo at 1159–1160. While the Court predicated its basis for sanctions on Rule 3.3, the Court also forwarded the matter to the California State Bar for consideration of any further discipline it deemed appropriate. Caputo at 1121. While no other Rules were addressed by the Court, many other Rules are implicated by the senior attorney’s conduct. One potentially implicated Rule is Rule 5.1, which provides, in pertinent part, as follows:

(b) A lawyer having direct supervisory authority over another lawyer, …shall make reasonable* efforts to ensure that the other lawyer complies with these rules and the State Bar Act.

(c) A lawyer shall be responsible for another lawyer’s violation of these rules and the State Bar Act if: (1) the lawyer orders or, with knowledge of the relevant facts and of the specific conduct, ratifies the conduct involved[.]” 

Cal. Rules of Professional Conduct, Rule 5.1

The Caputo Court found that the senior lawyer knew or should have known of the misrepresentation to the tribunal within the work of the junior lawyer. The courts and the Bar have provided very little guidance regarding the application of Rule 5.1 since its inception in November 2018. It will be interesting to see if the Bar takes this opportunity to provide further guidance regarding the application of Rule 5.1. Stay tuned, I predict a future Ethics in Brief may address this topic. 

Valerie Silverman Massey is a Chief Deputy City Attorney and the Chief Ethics & Compliance Officer at the Office of the San Diego City Attorney

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