The principle of zealous advocacy has long guided the legal profession, often to the detriment of ethical corporate compliance. Elise Maizel argues that reframing such advocacy in corporate law as disloyalty or betrayal when it supports misconduct could realign lawyers’ priorities toward upholding the law and benefit the public good.
The dominant norm in the legal profession is one of “zealous advocacy.” In popular culture we celebrate zealous advocates—heroic figures concerned for their client and their client only. And this professional ethic makes good sense in the defense of a human client, especially in contexts like criminal defense, where an individual faces punitive action at the hands of the state. But what does “zealous advocacy” look like when the client is a corporation?
Zealous advocacy has been used to justify attorney involvement in all manner of corporate misconduct. In the wake of the 2001 Enron fraud scandal, one legal commentator pointed to “zealousness” as the legal profession’s “central virtue” when making a distinction between the culpability of the company’s accountants at Arthur Anderson, which effectively dissolved due to the scandal, and their lawyers at Vinson & Elkins. Under this telling, accountants owe something to the state and to the public. Lawyers do not.
This view of an attorney’s essential zealousness, even in service of corporate clients engaged in misconduct, has become the prevailing perspective in popular conceptions of attorney ethics. But a closer look at the theoretical and doctrinal foundations of our corporate law might suggest something different. As I argue in a forthcoming paper in the DePaul Law Review, a doctrinally consistent reading of corporate law should conceive of lawyering in service of corporate misconduct as betrayal to the corporate client itself.
Corporate Law and legal fidelity
In the public imagination, a lawyer works with a client like a doctor works with a patient or a priest with their parishioner: a confidential relationship between a professional and a person who needs their help. This model fails to fit in quite the same way when the client is a corporation. A corporate lawyer can never be “alone” with her client. The corporation, a legal fiction, must speak through its agents: executives, managers, and other decision-makers. It is through those agents that the corporate client communicates its wants and needs. Corporate law gives corporate managers wide latitude to achieve these ends. However, some corporate wants and needs are non-negotiable, namely, the requirement that corporations obey the law. By way of example, Delaware’s incorporation statute allows corporations to organize “for any lawful purpose.” Put another way, according to former Chief Justice of the Delaware Supreme Court Leo Strine, Jr., “Delaware does not charter law breakers.”
Corporate law’s requirement of legal obedience frequently finds itself in tension with another key principle of corporate law—shareholder primacy. Shareholder primacy requires that a corporation’s board and management direct the corporation in a way that maximizes value for shareholders. Regulatory compliance is expensive. Lawbreaking can be quite profitable. But, because of the corporation’s essential requirement to obey legal obligations, law provides a limit as to how far a corporation’s agents can go to deliver shareholder value.
Though the law provides a limit, corporate officers and directors do cross it. Corporations break the law all the time. When corporate managers cause the corporation to violate the law, Delaware corporate law considers it a breach of the fiduciary duty of loyalty. To be loyal to the corporation, a corporate agent must try to keep that corporation acting within the bounds of the law.
Zealous advocacy and the market for corporate clients
For decades, the prevailing view of a lawyer’s role has been one of a zealous advocate. Law professor Monroe Freedman, one of the most prominent defenders of a zealous advocacy model, described what was required as “entire devotion to the interests of the client” without regard for the interests of others or the public.
Scholarly defenses of zealous advocacy often focus on the context of criminal defense or the representation of disadvantaged groups vis-a-vis more powerful interests, where the justifications for this model of lawyering apply more forcefully. But despite the differences between representing an individual client and an organizational one, the same ideological framework has come to dominate in representations of both individual and corporate clients alike.
For all the high-minded ideals about fidelity to law and loyalty expressed in corporate law doctrine, representing corporate clients is big business. The leading corporate law firms earn annual revenues in the billions of dollars and large corporate representations are extraordinarily lucrative. When it comes to outside law firms, individual corporate agents—general counsels and other corporate officers—decide which firms and lawyers to hire. Inside of corporations, in-house lawyers answer to more senior corporate officers and to the board. This makes it easy to conflate a corporate client with the agent for that client who speaks directly to the lawyer. At the same time, executive compensation is often closely linked to corporate financial performance. This can incentivize corporate managers to prioritize profits over legal compliance. All together, these structural forces can combine to drive lawyers to advocate for corporate behavior that is up to or even beyond the legal limit. Zealous advocacy provides a permission structure to do so.
A proposal: rethinking how we talk about corporate lawyers and misconduct
Zealous advocacy is often the excuse—or at least the explanation—when lawyers help to facilitate acts of corporate illegality. Zealous advocacy was offered as the reason for lawyers’ participation in the Enron scandal and the worst ills of the tobacco industry. Voices from the Delaware courts to the Securities and Exchange Commission have decried the rise of “can-do corporate lawyering”—the refusal to be the lawyer who says “no” to a client. To frame this problem as zealous advocacy is to assume that lawyerly assistance in service of corporate misconduct is loyal to that corporate client. But corporate law’s conception of loyalty to the corporation includes a duty to legal obedience. When lawyers help a corporate client to stray from that obligation, I suggest that we shouldn’t call it zealous advocacy. We should call it disloyalty or betrayal.
Why does it matter? The difference is more than just semantics. Narratives apply powerfully in corporate law. Business law scholars have long observed that the stories that we tell, through judicial opinions and through scholarly accounts of corporate behavior, influence policymakers and tell corporate players what kind of behaviors to aspire to.
As a practical matter, the punchlines of Delaware opinions are packaged by law firms into client alerts and sent to the inboxes of corporate officers and in-house counsels. In broad strokes, these stories offer instruction as to what kind of behavior is normatively acceptable in the corporate sphere. So too, the stories we tell about what a “good corporate lawyer” looks like tell young lawyers who to emulate. An entire body of behavioral ethics literature suggests we want to see ourselves as good people—lawyers included. When we use disloyalty or betrayal to describe the work of attorneys on behalf of corporate clients, we remind corporate lawyers of their client’s obligation to obey the law. The rhetoric of zealous advocacy risks lionizing lawyerly acts of public harm. To be a zealous advocate for a corporate client, a lawyer must be courageous enough to advocate for that client’s interest in legal compliance.
Author Disclosure: The author reports no conflicts of interest. Read ProMarket’s disclosure policy here.
Articles represent the opinions of their writers, not necessarily those of the University of Chicago, the Booth School of Business, or its faculty.
