Under every state’s ethics rules, lawyers not licensed there may temporarily provide legal advice under certain conditions, but normally may not establish a “systematic and continuous” presence there without violating criminal statutes. Some states punish such UPL violations as felonies. What impact do these scenarios have on privilege protection?

In Knaack v. Allied World Specialty Insurance Co., No. 2:23-cv-01679-BJR, 2024 U.S. Dist. LEXIS 114717 (W.D. Wash. June 28, 2024), plaintiffs sued a rehabilitation facility for sexual harassment — which the facility settled by assigning to plaintiffs its coverage claims against its insurer Allied for denying coverage. Plaintiffs sought communications between Allied and its lawyers, arguing that privilege protection was unavailable because “Allied hired attorneys who were not licensed in Washington to advise it on Washington law.” Id. at *10. The court bluntly rejected plaintiffs’ argument as frivolous and “so distorted as to merit sanctions.” Id.

In this case, the lawyers were only temporarily practicing in Washington, which was clearly acceptable under that state’s ethics rules. But courts’ deliberate disassociation between UPL/MJP issues and privilege protection is so strong that all or most courts would even protect as privileged someone’s communications with a nonlawyer imposter whom the client reasonably believed was a lawyer.