http://www.legalethicsforum.com/blog/2015/09/the-2015-vw-scandal-where-were-the-lawyers.html>.
This post gives my analysis of it. While we don’t know where Volkswagen’s
lawyers were – or if they were anywhere – we can plausibly speculate as to
where they might have been, and what they could have done to prevent
Volkswagen’s wrongdoing.
But in so doing I also want to ask whether the question is misplaced. Are
we wrong to put the faith we do in lawyers? And are we foolish to be
disappointed when they fail to justify the faith we place in them? And if
we are, is there a better question we could ask to understand institutional
wrongdoing?
Lawyers’ involvement in Volkswagen’s deception could plausibly have
occurred at one of two points: when the scheme to install the “defeat
devices” was put in place, and in 2014-15 when Volkswagen was being
investigated by the California Air Resources Board and the Environmental
Protection Agency.
At the time the company decided to install the defeat devices, the role of
the lawyers would have been advisory, providing some kind of opinion to the
company about the legality of its approach. Under one scenario, the lawyers
would have advised the company that its scheme was unlawful, but when the
company ignored their advice and proceeded with the installation of the
defeat devices, the lawyers – respecting solicitor-client privilege – said
nothing. Under another scenario, the lawyers advised the company that its
scheme was lawful. While one would like to think that no one could
plausibly advise that installing devices to fake-out emissions testing is
lawful, enough examples of egregious legal advice exist to prevent ruling
out that possibility.
At the time the company was dealing with the California and federal
investigations, the role of the lawyers would have been as advocates. They
would have helped the company develop and implement its “very aggressive”
response (as reported by the NYT) to those investigations. They would have
facilitated Volkswagen’s attempt to prevent its wrongdoing from being
publicly exposed.
How could lawyers have prevented or reduced Volkswagen’s deception? Their
best chance would be at the advising stage. By providing unequivocal advice
that installing the defeat device was unlawful, and taking that advice up
the corporate structure, including to the company’s board if necessary,
they could have involved enough people to make it difficult for the company
to proceed with such an unambiguously deceptive course of conduct. And
certainly at the advising stage the lawyers could have declined to provide
advice that would place a gloss of legality on the company’s malfeasance.
At the advocacy stage the lawyers could conceivably have advised the
company to cooperate with the investigation, but to do so would have had
only a marginal impact; at that point the company had already sold millions
of vehicles with the defeat devices installed. Further, it is not at all
clear that lawyers ought to decline to provide advocacy for their clients,
even when those clients have acted badly. Indeed, providing zealous
advocacy for the badly behaved client seems like proper conduct for a
lawyer, not improper. That the effect of such advocacy is to impair
government investigations does not change the analysis.
The ability of lawyers to prevent Volkswagen’s misconduct requires, though,
that the company actually ask the lawyers for advice, which it is not
obvious that they would have given the pretty clearly unlawful nature of
what they did. It also requires that, when asked for their advice, the
lawyers be willing to speak truth to power. To tell people at the company
on which they economically depend – either as external counsel or in-house
– and with whom they may have personal relations, that what they are doing
is clearly wrong. And then – if their advice is ignored – to commit the
social and professional solecism of calling out wrongdoing by their
colleagues and, perhaps, their friends.
Lawyers should do that. In fact, anyone with knowledge of what Volkswagen
was doing should have spoken out against it. Not much of a moral compass is
required to realize that actively and purposefully deceiving a government
regulator *attempting to prevent pollution* is really bad behaviour, and
that something ought to be done to stop it.
But how surprised ought we to be that people didn’t? We have any amount of
evidence – experimental and historical – that most people fail to rise
above their moral circumstances <http://ssrn.com/abstract=2148733>. When
circumstances and institutional structures encourage bad behaviour, people
are more likely to act badly then to act well. We properly assert the
lawyer’s obligation to respect and facilitate the rule of law, particularly
when advising clients
<http://papers.ssrn.com/sol3/papers.cfm?abstract_id=2450599>. Lawyers not
only have a personal moral obligation to address Volkswagen’s conduct but
also – if they were asked for advice – a professional one. But we should
also acknowledge that lawyers are only likely to fulfill those personal and
professional duties when circumstances at least somewhat support them doing
so. Lawyers have special duties. But they aren’t special – they are
ordinary people, likely to respond in the ways ordinary people do to the
circumstances in which they find themselves. So when a lawyer fears a
client’s disapproval (or wants the client’s approval), where the lawyer
works in an environment in which certain kinds of misconduct become
normalized or excused, where conformity is valued, or, conversely,
creativity in “interpreting” rules is, it is not really that surprising
that that lawyer does not act to prevent misconduct, even where
satisfaction of his personal or professional obligations should lead him to
do so.
This isn’t an excuse. Everyone who participated in the Volkswagen deception
acted wrongfully. But it is an explanation for the failure of lawyers to
prevent wrongdoing, and one that suggests that when you ask the question,
“where were the lawyers?” the answer is almost always going to be: where
everyone else was.
Which means that if our goal is to prevent corporate misconduct then asking
where the lawyers were isn’t the right question or, at least, isn’t a
sufficient one. It focuses on individuals and their professional
obligations, rather than on the circumstances in which those individuals
acted as they did. And that limited focus will never fully explain the
failure of those individuals to meet their obligations.
We have to ask tougher and more intractable questions. About the power
structure of the lawyer-client relationship, particularly where lawyers
work in-house. About the nature of corporate decision-making, and its
potential to encourage or discourage moral conduct. About the potentially
corrosive effect that lawyer advocacy has on lawyer advising.
In short, we have to ask not only where were the lawyers, but also about
where the lawyers were.
*This post originally appeared on **Slaw* <http://www.slaw.ca/>*.*
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