Hearing sought on possible conflict for major firms representing parents in admissions scandal

Federal prosecutors want a hearing on possible conflicts of interest for major law firms representing parents in the college admissions criminal case in Boston, even if their clients signed advance waivers, experts say.

The U.S. attorney's office in Massachusetts filed the hearing request Thursday to determine whether law firms such as Latham & Watkins LLP, Boies Schiller Flexner LLP, and Nixon Peabody LLP, which already represent USC in unrelated matters, had a conflict of interest representing parents in the college admissions criminal case in Boston.

USC, which allegedly voiced concerns of a conflict of interest months ago, said the conflict may occur if civil litigation between it and some of the criminal defendants arises in the future.

Latham attorney William J. Trach, who represents actress Lori Loughlin and her husband, fashion designer Mossimo Giannulli, reportedly responded to the suggestion by saying, "USC has suggested Latham's representation of Ms. Loughlin and Mr. Giannulli may conflict with USC's interest in possible future litigation with these individuals."

Any action by or against the couple is "completely speculative," news reports quoted him as saying.

However, legal ethics expert Diane Karpman, citing a recent civil suit filed against Georgetown University relating to the admissions scandal, said the prospect of impending litigation "is not that speculative."

Karpman, who filed an amicus brief in Sheppard Mullin Richter & Hampton LLP v. J-M Manufacturing -- a case directly dealing with advance waivers -- said even if Loughlin had signed a waiver, it might not free Latham and other firms from possible conflicts of interest.

"Most of the big firms now use advance waivers that say, 'I could do whatever I want,'" Karpman said. "However, Shepard Mullin says that's not good enough and gives specific instructions on how to write advance waivers."

Not only would the waiver have to include certain prerequisites, Latham must prove Loughlin was fully informed in her decision to sign it, said ethics expert Neil J. Wertlieb.

"There needs to be a disclosure of their representation of USC and the impact on her defense in order for the consent to be informed," Wertlieb said. "Ultimately, it turns on what is the language of the waiver, what was she waiving, and what did she know."

Adding to the possible holes in Latham's argument for no conflict of interest, Wertlieb said Latham -- due to its relationship with USC -- could be limiting Loughlin's defense strategy.

"There certainly is an argument that there was a substantial risk that they may be materially limited by their responsibilities to USC," Wertlieb said. "To be clear, it limits her defense in the federal prosecution in the extent her defense may have included shifting the blame to USC or pointing the finger at USC."

Trach did not respond to a request for comment Friday.

A Department of Justice spokesperson said documents relating to the hearing regarding a possible conflict of interest are under seal.