Legal Ethics Opinion #1508

Conflict of Interest-Representation of Multiple Parties in
Superfund Litigation

You have presented a hypothetical situation in which there is
pending in the United States District Court for the Eastern
District of Virginia an action brought pursuant to Section 107 of
the Comprehensive Environmental Response, Compensation and
Liability Act ("CERCLA") by Telephone Company against
approximately 140 defendants.  The object of the suit is to have
the court assign an "equitable allocation" to each defendant for
its proportional share of the cost for the cleanup of a hazardous
waste site located in Virginia.

You indicate that the Court has entered an order declaring that
every party in the action is deemed to have counterclaimed
against the plaintiff and cross-claimed against every other
defendant for contribution.  The Court's order permits parties to
file notices to "opt out" from contribution claims against any
parties a defendant so designates.  You advise that, in CERCLA
cases, it is generally understood that if one party contributes a
larger amount to a cleanup, another party will necessarily
contribute a smaller amount.  

Thus, it tends to be in each party's interest to try to establish
as high a volume as possible of waste generated by every other
party going to the site.  In other words, if more waste can be
attributed to one party, the other parties will have reduced
cleanup costs. 

You further indicate that, in the case pending in federal court,
several law firms represent more than one defendant in the
action.  In such instances, counsel have filed "opt out" notices
so that none of their clients are seeking cross-claims for
contribution against each other.  You indicate that you presume
that the "opt out" notices have been filed after full disclosure
and with the consent of the clients.  

You have asked the committee to opine whether, under the facts of
the inquiry, in a CERCLA private cost recovery action, conflicts
are waiveable in situations of multiple representation when the
clients have statutory rion against each other and it is in all
the clients' interests to assert said contribution claims.

The appropriate and controlling Disciplinary Rules related to
your inquiry are DRs 5-105 (A), (B), and (C) which state
respectively that a lawyer shall decline proffered employment and
shall not continue multiple employment if the exercise of his
independent professional judgment in behalf of a client will be
or is likely to be adversely affected by the representation of
another client, except that a lawyer may represent multiple
clients if it is obvious that he can adequately represent the
interest of each and if each consents to the representation after
full disclosure of the possible effect of such representation on
the exercise of his independent professional judgment on behalf
of each.

For additional guidance, the committee directs your attention to
Ethical Consideration 5-l5 which exhorts the lawyer facing the
possibility of impaired independent judgment or divided loyalty
to resolve all doubts against the propriety of the [multiple]representation.  A lawyer should never represent in litigation
multiple clients with differing interests, and there are few
situations in which he would be justified in representing in
litigation multiple clients with potentially differing interests. 
If a lawyer accepted such employment and the interests did becomeactually differing, he would have to withdraw from employmentwith likelihood of resulting hardship on the clients; and for
this reason it is preferable that he refuse the employmentinitially...there are many instances in which a lawyer may
properly serve multiple clients having potentially differing
interests in matters not involving litigation...if [those]
interests become differing, withdrawal is less likely to have a
disruptive effect upon the causes of his clients.  (emphasis

The committee is of the opinion that the proposed multiple
representation would not be per se improper and violative of DR
5-105(A), (B) or (C).  However, since the interests of the
multiple clients are potentially differing as to the respective
amounts of each contribution, ng interests mature into actual
adverse interests, it may then become necessary for the attorney
to withdraw from representing all clients involved in the
litigation.  See LEOs l4l0, l499, l505.

Committee Opinion
August 12, 1993