When Your Client Lies: What we can learn from Lance Armstrong

Lance Armstrong’s legal team played a part in each of the racing metals, the Livestrong brand, the endorsements, the accusations, the denials and of course the many lawsuits he filed to defend his reputation. Frankly, in light of the recent confession on Oprah, Armstrong’s attorneys may be feeling a bit uncomfortable. 

We now know that for years Armstrong was living a lie.  Those lies filled court documents that were signed by various attorneys attesting to the truthfulness of Armstrong’s assertions. Those lies fueled settlements and character attacks and destroyed careers. Now the gig is up yet the question remains: what role did his attorneys play in those denials and what are the legal implications of the confession for the cyclist and his attorneys?

There are wide ranging legal implications stemming from Armstrong’s recent confession many of which are detailed by Sports Illustrated here. Armstrong faces potential criminal charges for perjury, obstruction of justice, conspiracy, racketeering, and embezzlement.

In the civil arena, Armstrong’s potential liability primarily stems from his long-standing denials and attacks directed to his accusers, some of whom he sued for defamation claiming that they destroyed his reputation.  Now the tables have turned.  In at least one instance Armstrong agreed to settle a defamation lawsuit in exchange for a hefty settlement.  The Sunday Times is reportedly considering filing suit to recover the nearly $1.5 million it paid Armstrong to settle his defamation suit. Other “victims” of Armstrong’s attacks are reportedly considering their legal options as well.  

So query what does the potential fallout from Armstrong’s confession mean for his legal advisors? Consider the possibility that Armstrong pursues a malpractice claim against his attorneys who were involved in the decision to appear on Oprah.  If Armstrong is forced to defend numerous lawsuits as a result of the confession, it is not impossible that Armstrong alleges that his former attorneys should have cautioned him against coming clean for fear of the legal repercussions.  Given that Armstrong is seeking to improve his public image, and his claimed goal of cooperating with the authorities, it is unlikely that Armstrong would seek to further shift blame, but it is a possibility.

It is also possible that Armstrong’s attorneys be compelled to provide deposition, grand jury or trial testimony.  Giving his legal team the benefit of the doubt, we must assume that during the “denial” stage of Armstrong’s career, his attorneys were not aware that Armstrong knowingly lied about his drug use. Nonetheless, each of his attorneys may be called as a witness without the benefit of the attorney-client privilege to protect their private communications.  Pursuant to the crime-fraud exception, Armstrong’s attorneys may be compelled to testify regarding conversations with their client because Armstrong was engaged in an ongoing fraud even if the attorneys were not aware of his drug usage. In re Grand Jury Proceedings (Corporation), 87 F.3d 377 (9th Cir. Cal. 1996). The disclosure of those “private” conversation between attorney and client could lead to other revelations that Armstrong, and perhaps his attorneys, would have preferred to keep out of the limelight.

The lessons from the Armstrong fall from grace are numerous.  Notably, advisors may not hide behind their clients or blindly accept representations without some due diligence.  Moreover, attorneys must be cognizant of the limitations of the attorney-client privilege and the possibility that a client’s story may change dramatically down the road. No matter the fame or clout of any given client, an attorney must maintain her objectivity and be prepared to disengage if necessary.

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