When your client needs to file a lawsuit in another state, you are frequently not licensed to practice law in the other state. As a result, the company must (typically with your assistance) find a local, out-of-state law firm to serve as local counsel. Sure, you will probably appear as co-counsel along with the local law firm, and as you read this blog post you might be sitting there thinking the local counsel will not do much work. Right? Not so fast.
All too frequently, local counsel take an inactive role in lawsuits, letting the out-of-state lawyers drive the ship. A recent decision from a Delaware state court reminds attorneys that when they serve as local counsel, they must be actively involved in the case. In James v. National Financial LLC, Delaware's Court of Chancery provides a stern reminder regarding local counsel's duties, ultimately holding local counsel liable for sanctions due to improper actions by the out-of-state attorneys and their client. According to the court, the local attorneys should have been more involved in the case and, if they had been, the misconduct might have been prevented.
Courts and ethics opinions in other states have reached similar conclusions. The old "rubber stamping" days of local counsel are seemingly over, at least in an ever-increasing number of jurisdictions. If you are going to be retained as local counsel, you should make sure the out-of-state client and/or attorneys are not just looking for somebody to file their pleadings, or merely looking for a place to take their depositions or store their bags when they’re in town for a court appearance. In addition, you should be prepared to take on an active role in the case and should make sure your client and outside counsel understand and agree with your position from the onset.