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Legal Ethics

Some lawyer puffery in settlement negotiations is allowed, proposed California ethics opinion says

A lawyer negotiating on behalf of a client in settlement talks may engage in some “puffery” in regards to the client’s goals or willingness to compromise, according to a proposed ethics opinion by the ethics committee of the California State Bar.

A lawyer’s false statements of material fact, however, would violate ethics rules that bar a lawyer from engaging in deceit, the proposed ethics opinion (PDF) says. That means a lawyer can’t falsely claim there is a favorable eyewitness, for example, and can’t make false statements about insurance policy limits. The ABA/BNA Lawyers’ Manual on Professional Conduct has the story.

The opinion is consistent with ABA Formal Op. 06-439, though the ABA opinion is based on a model ethics rule that has not been adopted in California. The rule bars lawyers from making false statements of material fact or law to a third person, and bars lawyers from failing to disclose a material fact when disclosure is necessary to avoid assisting a client’s criminal or fraudulent act.