Journal of American Law

SPRING 2015

The Journal of American Law is a peer-reviewed journal and the only one of its kind in the country. The Journal is a law review focused on important legal issues ranging from complex litigation to Supreme Court rulings.

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Spring 2015 // Journal of American Law 21 ing from the settlement of the litigation. 25 Moreover, counsel to a settling plaintif may not enter into a hold harmless/in- demnifcation agreement for the beneft of settling defendants as such an agreement also would create an impermissible confict of interest in violation of Rule 1.7(a) of the New York Rules of Professional Conduct. 26 As such, it also is unethical for defense counsel to request indemnifcation from plaintif 's counsel. Rule 8.4(a) provides that a lawyer or law frm shall not knowingly assist or induce another to violate the Rules of Professional Conduct. 27 New York is one of the states that has adopted the Model Rules of Professional Conduct, specifcally Rules 1.7, 1.8, and 8.4, as previously discussed. On Feb. 11, 2011, the Supreme Court of Ohio Board of Commissioners of Grievances and Disciplines rendered Opinion 2011-1. Te opinion stated that it is unethical for a plaintif 's attorney to personally agree, as a condition of set- tlement, to indemnify the opposing party from any and all claims by third persons to the settlement funds as the agree- ments are not authorized by Rules 1.15(d) 28 and violate Rules 1.8(e) and 1.7(a)(2). Moreover, the opinion also opined that it is improper for a lawyer to even propose or mandate, as a condition of settlement, that a plaintif 's attorney makes a personal agreement to indemnify the opposing party from any and all claims by third persons to the settlement funds as this violates Ohio Rules of Professional Conduct 8.4(a) as it is unlawful to induce another to violate the Ohio Rules of Professional Conduct. Te context of the Ohio Rules of Pro- fessional Conduct Rules 1.7(a)(2), 1.8(e), and 8.4 is the same as the Model Rules of Professional Conduct. In Legal Ethics Opinion 2013-01, the West Virginia Dis- ciplinary Board opined that an attorney is ethically barred from entering into a hold harmless and indemnifcation ar- rangement with an insurance company or self-insured paying a claim to his client. Te West Virginia Disciplinary Board also noted that it is unethical and a violation of Rule 8.4(a) of the Rules of Professional Conduct for an attorney to even request, as a condition of settlement, that plaintif 's counsel agrees to personally indemnify from any and all claims by third parties 25 N.Y. Rules of Prof'l Conduct R. 1.8(1) (2010). 26 N.Y. Rules of Prof'l Conduct R. 1.7(a) (2010). 27 N.Y. Rules of Prof'l Conduct R. 8.4(a) (2010). 28 Ohio Rules of Prof'l Conduct R 1.15(d) of the states that upon receiving funds or other property in which a client or third person has a lawful interest, a lawyer shall promptly notify the client or third person. For purposes of this rule, the third person's interest shall be one of which the lawyer has actual knowledge and shall be limited to a statutory lien, a fnal judgment addressing disposition of the funds or property, or a written agreement by the client or the lawyer on behalf of the client guaranteeing payment from the specifc funds or property. Te rule further states that, except as stated in Rule 1.15 or otherwise permitted by law or by agreement with the client or a third person, confrmed in writing, a lawyer shall deliver promptly to the client or third person any funds or other property that the client or third person is entitled to receive. Upon request by the client or third person, the lawyer shall render promptly a full accounting regarding such funds or other property. to settlement funds as it is unlawful to induce another to vi- olate the West Virginia Rules of Professional Conduct. Rule 8.4(a) of the West Virginia Rules of Professional Conduct also adopts the same language as Rule 8.4(a) of the Model Rule of Professional Conduct. On Oct. 23, 2013, the State Bar of Georgia issued Formal Advisory Opinion No. 13-2, which opined that an attorney may not ethically agree, as a condition of settlement, to in- demnify the opposing party from claims by third persons to the settlement funds. Te opinion stated that indemnifcation agreements violated Rule 1.8(e) of the Georgia Rules of Pro- fessional Conduct, which prohibits a lawyer from providing fnancial assistance to a client in connection with pending or contemplated litigation. Moreover, the opinion also provided that it is unethical for defense counsel to require, as a condi- tion of settlement, that a plaintif 's lawyer makes a personal agreement to indemnify the opposing party from claims by third persons to the settlement funds because this violated Rule 8.4(a)(1) of the Georgia Rules of Professional Conduct, which prohibits an attorney from knowingly inducing anoth- er attorney to violate the Georgia Rules of Professional Con- duct. Similar to Rule 8.4 of the Rules of Professional Conduct of New York, Ohio, and West Virginia, Rule 8.4 of the Georgia Rules of Professional Conduct uses the same language as Rule 8.4 of the Model Rules of Professional Conduct. Rule 1.8(e) of the Georgia Rules of Professional Conduct also is the same as Rule 1.8 of the Model Rules of Professional Conduct. Conclusion In general, when the injured party is a Medicare benefciary and the date of the incident is on or afer Dec. 5, 1980, liability insurers, including self-insurers and no-fault insurers, are the primary payers. If a Medicare benefciary has made a claim against a liability insurer, the provider, physician, or suppli- er is required to bill the liability insurer frst unless there is evidence that the liability insurer will not promptly pay the claim. 29 Tus, if payment is not tendered promptly, Medicare may be billed as a primary payer, which allows Medicare to pay conditionally, subject to reimbursement if there is a settle- ment, judgment, award, or other payment. Protecting the interests of Medicare is a complex issue about which all counsel should be concerned and take the proper steps to ensure compliance with the appropriate re- porting obligations. Counsel must be aware of Medicare's in- terests and that protecting those interests is a priority to all parties involved. Counsel must make certain that any MSP issues are discovered early in the litigation process. Defense counsel should request the relevant Medicare information and status of a plaintif during initial discovery. Moreover, counsel should remain engaged with the Medicare Secondary Payer Recovery Contractor (MSPRC) and obtain conditional pay- ment information as soon as possible. 29 42 C.F.R. 411.21; 42 C.F.R. 411.50.

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