The American Bar Association Renders an Opinion Distinguishing "Puffing" done in Negotiation from "False Statements of Material Fact"
The American Bar Association's Standing Committee on Ethics & Professional Responsibility recently released an opinion, here, focusing on Model Rule 4.1, and more specifically Rule 4.1(a) that addresses lawyers making false statements of material fact. Under Rule 4.1, in the context of negotiation or caucused mediation a lawyer representing a party may not make a false statement of material fact to a third person. However, statements regarding a party's negotiating goals or its willingness to compromise, as well as statements commonly referred to as "posturing" or "puffing" are ordinarily not considered "false statements of material fact" within the meaning of the Model Rules.
Puffing: A plaintiff's lawyer insists that her client will not agree to resolve a dispute for less than $200, when, in reality, the lawyer knows her client is willing to accept as little as $150 to put an end to the matter.
False Statement (violation of Rule 4.1): A lawyer representing an employer in labor negotiations states to union lawyers that adding a particular employee benefit will cost the company an additional $100 per employee, when the lawyer knows it will actually cost $20 per employee.| Posted By Cassandra Crotty In Model Rules of Professional Conduct | 0 Comments | Permalink