Opinion ID: 2231182
Heading Depth: 2
Heading Rank: 3

Heading: Acquiring Interest in Litigation.

Text: DR 5-103(A) prohibits a lawyer from acquiring a proprietary interest in the cause of action or subject matter of the litigation being conducted for the client, subject to exceptions not applicable in this case. DR 5-103(A). The Commission found Johnston violated this rule by representing Corcoran when he had purchased the assignment of his redemption rights. Johnston claims he did not violate the rule because there was no litigation being conducted for Corcoran once Johnston acquired Corcoran's redemption rights. In other words, Johnston claims he acquired Corcoran's interest in the litigation prior to representing him in the litigation. Lawyers are generally prohibited from injecting themselves into the legal affairs of clients. See Comm. on Prof'l Ethics & Conduct v. Bitter, 279 N.W.2d 521, 523 (Iowa 1979). While DR 5-104 addresses the prohibition against engaging in business with clients, DR 5-103(A) specifically targets the acquisition of a proprietary interest in litigation being conducted by an attorney for a client. Recognizing the limitation in DR 5-103(A), Johnston attempts to sidestep the rule with his claim that Corcoran had no actual legal interest in the pending foreclosure litigation once Corcoran became his client. While we recognize the obvious inconsistency in Johnston's claim, the record shows Johnston inserted himself into Corcoran's litigation and agreed to represent Corcoran in the litigation as a part of the same transaction. Clearly, Johnston's conduct violated DR 5-103(A). The rule captures conduct where a lawyer is both a litigator for a client in litigation and a party to the litigation.