Few aspects of in-house practice are more daunting than playing “gatekeeper”—preventing colleagues from violating laws, regulations, or the rights of others. If
Gatekeeping challenges arise in every environment, in-
you delay a product launch to resolve safety or regulatory
concerns, you’ll almost certainly be unpopular with some
of your colleagues who are kept waiting to receive their full
year-end bonuses as a result of your gatekeeping. In some
organizations, you might even see a ding in your year-end
evaluation—and your bonus. These opaque digs might read
like “needs to show greater business judgment,” or “needs to
be less dogmatic.”
But let the product launch go forward with unresolved
concerns and the consequences could be much worse for you
and the organization, as Volkswagen learned.
cluding public agencies and nonprofit organizations. Counsel
must be prepared to respond effectively.
A significant source in terms of in-house responsibility
is Washington’s version of ABA Model Rule of Professional
Conduct 1. 13(b):
RPC 1. 13 ORGANIZATION AS CLIENT
(b) If a lawyer for an organization knows that an officer, employee or other person associated with the organization is
engaged in action, intends to act or refuses to act in a matter related to the representation that is a violation of a legal
obligation to the organization, or a violation of law that
reasonably might be imputed to the organization, and that
is likely to result in substantial injury to the organization,
then the lawyer shall proceed as is reasonably necessary
in the best interest of the organization. Unless the lawyer
reasonably believes that it is not necessary in the best interest of the organization to do so, the lawyer shall refer the
matter to higher authority in the organization, including, if
warranted by the circumstances, to the highest authority
that can act on behalf of the organization as determined by
A wide range of statutes and regulations also create criminal and regulatory enforcement exposure for in-house counsel
The complex role of in-house counsel
viewed as having failed as gatekeepers. The regulations promulgated by the Securities and Exchange Commission (SEC)
under Section 307 of Sarbanes-Oxley, for example, impose
“reporting up” obligations on in-house counsel at publicly
traded companies, 15 U.S.C. § 7245; 17 C.F.R. Part 205.
Prosecutors and regulators alike have targeted numer-
ous in-house counsel in recent years, alleging both “aiding
and abetting” and even direct involvement in criminal or
Shareholders and other civil litigants, including former
client organizations, may also sue in-house attorneys for poor
gatekeeping, often alleging malpractice (professional negli-
gence) and fiduciary violations.
All in-house counsel are subject to potential malpractice
claims for failing to prevent harm to the organization. And
general counsel, as company officers, have heightened fiduciary duties under corporate law to protect company assets by
preventing harmful misconduct.
Before taking any in-house position, candidates should consider gatekeeping risk factors. Risks can be more frequent and more serious, for example, in highly
regulated industries or where the products or services offered
pose greater risks to consumers or the public. Where there are
more rules and regulations to follow, there are also inherently
more temptations to break those rules for cost reasons or for
competitive advantage. Risky products and services increase
both the likelihood and potential severity of alleged gatekeeping failures, since complaints to regulators are more likely.
But the most significant organizational factors may be
more subjective. The highest risk levels are probably found in
organizations with poor ethical leadership at the top and hence
weak internal ethics standards throughout. If rumor has it that
the CEO is a narcissistic bully, consider applying elsewhere.
Even highly ethical but siloed organizations can pose
challenges if the segregation or dispersion of duties and
authority allow projects or initiatives to get far along without adequate legal or regulatory input. It is always harder to
effectively guide or alter a project once substantial resources
have been committed.