Business & Practice

Wash. Lets In-House Counsel Sue Employer for Firing (Corrected)

July 22, 2019, 7:15 PMUpdated: July 23, 2019, 5:41 PM

The in-house attorney for a Washington state corrections officers guild can sue the guild for wrongful termination and breach of contract, the state’s highest court recently ruled.

The ruling is an acknowledgment of the evolving nature of jobs that attorneys hold and a rejection of the “rigid interpretation” of a legal ethics rule that protects a client’s right to terminate an attorney at any time and for any reason.

“Solely in the narrow context of in-house employee attorneys, contract and wrongful discharge suits are available, provided these suits can be brought without violence to the integrity of the attorney-client relationship,” Judge Charles K. Wiggins wrote for the en banc court.

The court joins California, Massachusetts, Minnesota, Montana, and New Jersey in its holding.

Jared Karstetter was fired in 2016 from his in-house position for the King County Corrections Officers Guild, which he’d held since 1987. Karstetter sued the guild, alleging his termination violated his contract, which provided for just cause termination. The court of appeals ordered his breach of contract and wrongful termination claims to be dismissed.

“Today’s legal employees operate differently from private sector attorneys” and juggle many balls, including legal and nonlegal duties, the state Supreme Court said.

The relationship between and in-house attorney and the employer client therefore can’t be characterized solely as an attorney-client relationship, it said. It also has to be viewed as an employer-employee relationship, the court added.

The ethics rule allowing clients to fire their attorneys without cause doesn’t even recognize “the nontraditional circumstances” surrounding in-house attorneys and whether the rule should apply in that context, it said. It was written at a time when more attorneys worked within the traditional law firm practice model, the court pointed out.

And shielding an employer in this situation from all consequence “ignores the realities of modern legal work and risks creating unconscionable results,” leaving the attorney employees “without any legal recourse,” it said.

The court concluded that in-house attorneys may pursue wrongful discharge and breach of contract claims against their client employers and that Karstetter’s claims shouldn’t have been dismissed, finding that he pleaded facts sufficient to bring the claims against the guild.

The case is Karstetter v. King Cty. Corr. Guild, 2019 BL 265367, Wash., No. 95531-0, 7/18/19.

(Removed Illinois from list of states with similar rulings in snapshot and fourth paragraph)

To contact the reporter on this story: Melissa Heelan Stanzione in Washington at mstanzione@bloomberglaw.com

To contact the editors responsible for this story: Jessie Kokrda Kamens at jkamens@bloomberglaw.com; Rebekah Mintzer at rmintzer@bloomberglaw.com

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