New York State
Ethics Commission


Advisory Opinion No. 97-8: Whether Public Officers Law §74 precludes a Board member from participating in a matter in which he was involved prior to his appointment to the Board.

INTRODUCTION

The following advisory opinion is issued in response to a request from [ ], a member of the Board of Trustees of [a public University], who asks whether the provisions of Public Officers Law §74 preclude his participation as a Board member in matters relating to legal actions brought against [the University] where he was previously associated with the plaintiffs and shared confidences with their attorneys.

Pursuant to the authority vested in it by Executive Law §94(15), the New York State Ethics Commission ("Commission") hereby renders its opinion that Public Officers Law §74 requires [the requesting individual]: (1) to disclose to the Board his prior relationship with the plaintiffs and their attorneys, and recuse himself from participation in these matters; (2) to absent himself from any executive session of the Board in which litigation strategy is discussed; and (3) to refrain from speaking before any civic or fraternal organization regarding the litigation or related issues. [The requesting individual] may recommend, without argument, to the Trustees at a public meeting of the Board that they invite both sides to the dispute to attend a future public meeting.

BACKGROUND(1)

A. The Legal Proceedings

In 1978, the Legislature held hearings regarding complaints of widespread discrimination by [the University] against Italian-American staff and faculty members. Following those hearings, a report was issued which concluded that [the University] had so discriminated. The report proposed, among other things, the formation of an [ ] Institute ("Institute") within the University to address the problem of discrimination and to provide cultural and information services. The Institute was created by the Legislature in 1979, [ ].

In July, 1990, the Italian-American Legal Defense and Higher Education Fund, Inc. ("Fund")(2) filed a complaint with the United States Department of Labor ("DOL") alleging discrimination on the basis of national origin on behalf of numerous Italian Americans on the faculty and staff of [the University]. The Institute and its Director, [ ], played a leading role in the investigation and the compilation of the data supporting the Fund's complaint.

In September, 1992, following an announcement by [the University] of a plan to reorganize the Institute, a lawsuit was commenced in the United State District Court for the Southern District of New York to enjoin [the University] from implementing its announced plan. The complaint alleged that Italian-Americans had been discriminated against in employment because of their national origin and that the re-organization plan for the Institute was an act of retaliation for its having assisted in bringing the DOL action. The plaintiff in the court action was [the Director of the Institute], who sued individually and as Director of the Institute. The Fund was not a plaintiff, although the plaintiff's lawyers were the same lawyers who represented the Fund in the DOL proceeding. [The University's] Chancellor, [ ], was named as a co-defendant. In November, 1992, the District Court granted the plaintiff's motion for a preliminary injunction.(3)

In January, 1994, the parties to the federal court action entered into a Settlement Agreement resolving the litigation. The Agreement, to which the Fund was a signatory, provided that the Fund would withdraw the DOL complaint and that the discrimination claims of the individuals could be pursued in arbitration. In addition, the Institute was to remain at its existing location and be granted research status.

In late 1996, [the Director of the Institute], on his own behalf and on behalf of the Italian-American community generally, as well as in his capacity as Director of the Institute, brought an action against [the University] in State court claiming that it was acting in violation of the Settlement Agreement as it pertained to the DOL discrimination claimants. The Fund is a party to this action, which is pending.

As a result of the State court action, the Coalition of Italian American Organizations ("Coalition"), along with other Italian-American groups, has commenced a letter writing campaign urging [the University's] Chancellor to resolve the matter or resign.

B. [The Requesting Individual's] Involvement

During the pendency of the federal court action, [the requesting individual], who at the time had no official affiliation with the Fund, stated that "[a]cting on my own behalf, . . . I gave advice to plaintiff's lawyers and to [the Director of the Institute] as to legal matters pertaining to the federal court action. I also sent a letter to the then Governor and then Mayor in which I claimed that [the University's] reorganization of the Institute was, in fact, in retaliation for the assistance the Institute provided to the claimants on the DOL matter. I was also present for some portion of the hearings that were held in the Federal Court Action, although only as a layperson and member of the public."

Sometime after the Settlement Agreement was reached, [the requesting individual] became a member of the Fund's Board of Advisors. He stated that his position on this 20 member board was "largely ceremonial although some advisors provide advice to the Fund on an ongoing basis. The Fund's governing authority rests with its 10 member Board of Directors." At about the same time, [the requesting individual] also became a Board member of the Coalition.

[The requesting individual] states that subsequent to the signing of the Settlement Agreement, he had several conversations with [the Director of the Institute] and the Fund's lawyers regarding [the University's] obligations under the Agreement. The Fund's lawyers, among others, indicated to [the Director of the Institute] their view that [the University] was not fulfilling its obligations with regard to giving the Institute research status and arbitrating the various individual discrimination claims.

In [date], [the requesting individual] was appointed by [ ] to [the University's] Board of Trustees. This was shortly before [the Director of the Institute] commenced the State court action.

[The requesting individual] states that in order to "avoid any appearance of impropriety and out of an abundance of caution" he has recently resigned from the Board of Advisors of the Fund and from the Board of Directors of the Coalition. However, [the requesting individual] continues to have strong views about the ongoing litigation, and he would like to play a role in bringing the parties together to resolve the matter. In his letter of request, he argues that it is in [the University's] interests to proceed to arbitration rather than to raise legal defenses that may avoid arbitration. He has asked a number of questions:

  1. May I voice my views and concerns . . . either at public meetings of the Board of Trustees of [the University], during executive sessions of the Board, in private conversations with others or in speaking to various civic or fraternal organizations?

  2. To what extent could I recommend that the Board of Trustees invite both sides to the ongoing litigation to present their views at a public meeting of the Board and respond to the Board's questions? If that were permissible, could I participate in such a meeting by posing questions?

  3. Could I, with the approval of the Board of Trustees, act as a mediator in an attempt to settle and/or otherwise resolve the State court action?

  4. Given that I am no longer an advisor to the Fund, could I vote on matters that affect either procedural matters or more substantive matters relating to the State court action? Would it be permissible for me to take part in executive sessions of the Board of Trustees where such sessions relate to litigation strategy in connection with the State court action?

  5. To what extent could I, consistent with my ethical duties and obligations, provide my fellow trustees, members of the State government or any individuals with a copy of this opinion request?

APPLICABLE STATUTE

Public Officers Law §74(2), the code of ethics for State officers and employees, addresses the conflict between the obligation of public service and private, often personal, financial interest. The rule with respect to conflicts of interest is as follows:

No officer or employee of a state agency . . . should have any interest, financial or otherwise, direct or indirect, or engage in any business or transaction or professional activity or incur any obligation of any nature, which is in substantial conflict with the proper discharge of his duties in the public interest.

Following the rule with respect to conflicts of interest, Public Officers Law §74(3) provides standards of conduct which address actual as well as apparent conflicts of interest:

. . . .

(d) No officer or employee of a state agency . . . should use or attempt to use his official position to secure unwarranted privileges or exemptions for himself or others.

. . . .

(f) An officer or employee of a state agency . . . should not by his conduct give reasonable basis for the impression that any person can improperly influence him or unduly enjoy his favor in the performance of his official duties, or that he is affected by the kinship, rank, position or influence of any party or person.

. . . .

(h) An officer or employee of a state agency . . . should endeavor to pursue a course of conduct which will not raise suspicion among the public that he is likely to be engaged in acts in violation of his trust.

. . . .

DISCUSSION

A. Application of §74 to [the University] Trustees

[The University] is defined as a "State agency" in Public Officers Law §§73 and 73-a and, as a result of this definition, is within the jurisdiction of the Commission. However, [the University's] Trustees, who receive no compensation, are not covered by §73(4), and there is some question as to whether they are covered by §74(5). To address a possible void, and to guide the conduct of its Board members in carrying out their official duties, [the University has] adopted a Code of Conduct which attempts to parallel these sections of law. As the Commission has previously indicated, [this] Code does not replicate Public Officers Law §§73 and 74, but its concepts and intent are similar, and its language seems patterned on these legislative enactments. Thus, the Commission believes that it can look to its advisory opinions for guidance.(6)

B. Constraints on Unpaid and Per Diem Board Members

Public Officers Law §74 deals with conduct that may result in actual conflicts of interest as well as conduct that could give the impression that a conflict exists. As the Attorney General stated in a 1979 opinion(7):

A public official must not only be innocent of any wrongdoing, but he must be alert at all times so that his acts and conduct give the public no cause for suspicion. He must give no appearance of a potential conflict between his official duties and personal activities even though an actual conflict is not present. . .

The Commission has addressed the application of Public Officers Law §74 to unpaid and per diem board members serving in policymaking positions in a variety of situations in which the private activities and public duties of an individual might give rise to a conflict of interest or the appearance of a conflict. While each situation must be individually examined, the Commission has identified several important factors to be considered. For example, the Commission will examine how a board member's private employment or other professional relationships or affiliations may affect his or her judgment in carrying out official State duties. Where the private employment or relationship is in the past, the Commission will look to how recently it was terminated, as well as its nature and duration. (Advisory Opinion No. 94-11).

In applying these standards, the Commission, in Advisory Opinion No. 94-11, held that where a member of a board ended his employment relationship with a union organization one and one-half years prior to the submission of a grant proposal by the union to the board, the board member was prohibited from considering the proposal. Recognizing that the Legislature has imposed a two year post-employment bar on State officers and employees appearing before their former agency, the Commission adopted a presumption that a vote by a board member on a matter concerning a former employer within two years of his having left the employment could raise suspicion among the public that he in violation of his public trust. Such participation by the board member could raise questions as to his motivation in voting on the grant award. In addition, the board member may still be in a position to be influenced by the former employer or client, thereby raising further suspicion concerning his action.

The Commission concluded that in such circumstances, a board member must disclose to the board any prior employment or business relationship with an applicant and recuse himself or herself from participating in any official board action. However, it noted that special factors concerning the nature or duration of the prior relationship could overcome the presumption of a conflict.

In the same Advisory Opinion, the Commission considered a situation where a prior attorney-client or consultant-client relationship had existed, and where the possibility of a future business relationship also existed, as the subject board member had entered into negotiations to render future services. The Commission held that he must disclose that information to the board and refrain from participating in any board action involving the former client.

The Commission has in many other different contexts required State officers to disclose their affiliations and recuse themselves from participating in matters which may give rise to a conflict or the appearance of a conflict.(8) It set forth its approach to these situations in Advisory Opinion No. 96-26 as follows:

[The] Commission has looked to disclosure and recusal as a preferred mechanism to avoid potential conflicts rather than the imposition of a total prohibition on State service.

The need to disclose and recuse from participation to avoid the potential for conflict is a theme echoed in other established ethical codes. For example, the Disciplinary Rules of the Code of Professional Responsibility, found at Part 1200 of Title 22 of the New York Code of Rules and Regulations, establish standards of conduct for practicing lawyers in New York State. Part 1200.45 [formerly DR9-101] concerns Avoiding Even the Appearance of Impropriety. Subdivision three of this Part provides:

A lawyer serving as a public officer or employee shall not:
(i) participate in a matter in which the lawyer participated personally or substantially while in private practice or nongovernmental employment, unless under applicable law no one is, or by lawful delegation may be, authorized to act in the lawyer's stead in the matter.

While the Commission does not enforce the Code of Professional Responsibility, it often looks to the Code for guidance when attorneys are involved.(9)

C. Responses to [the Requesting Individual's] Questions

Applying these principles, the Commission now turns to each of the questions posed by [the requesting individual].

1. May [the requesting individual] voice his views and concerns either at public meetings of the Board of Trustees of [the University], during executive sessions of the Board, in private conversations with others or in speaking to various civic or fraternal organizations?

In implementing Public Officers Law §74, the Commission has, as noted above, required a State official to disclose and recuse on a matter where his or her outside activities or relationships may give rise to the potential for a conflict of interest or the appearance of a conflict. This is consistent with the Code of Professional Responsibility as it applies to attorneys who are government officials.

Here, [the requesting individual], has been a longtime supporter of the Institute and its director, a member of the Fund's Advisory Board and a board member of the Coalition. Thus, for several years he has been associated with individuals and an institution that have been adversarial to [the University], both in legal proceedings and in the public forum. Significantly, he has shared confidences with plaintiffs and their attorneys with respect to the various legal actions that have been brought against [the University].

Based on this history and these prior relationships, the Commission concludes that [the requesting individual] may not participate as a [University] Trustee in discussions regarding the current State court action or Settlement Agreement. First, he must disclose to [the University] Board his prior relationship with the plaintiffs, as well as with their lawyers, the Fund and the Coalition, and his prior involvement in the federal court action and the Settlement Agreement. He must then recuse himself from participation as a Board member in any debate, whether at a public meeting of the Board, during an executive session or in private conversation with other Trustees. [The requesting individual], when acting as a [University] Trustee, is cloaked with his State office at all times, and he cannot distinguish between "public" and "private" discussions.(10)

In addition, [the requesting individual], as an attorney, may be precluded by the Code of Professional Responsibility from publicly or privately sharing his views on the matter, since he was privy to privileged attorney-client confidences. That is a matter for the Ethics Committee of the Bar Association should [the requesting individual] seek its opinion.

Finally, [the requesting individual] may not, as a private citizen, speak to civic or fraternal organizations about his views and concerns regarding the issues surrounding the litigation. He is a [University] Board member, and cannot separate himself from his position by leaving the University's halls. He would have to resign from [the University] Board of Trustees if he wished to publicly speak on the matter.

2. To what extent may [the requesting individual] recommend to the Board that it invite both sides in the ongoing litigation to present their views at a public meeting of the Board and respond to the Board's questions? If such a meeting were held, could he participate by posing questions?

Although [the requesting individual] may not discuss the substantive issues surrounding the litigation, he has asked whether he may recommend to the Board that it call a public meeting with the plaintiffs to discuss the matter.

The Commission believes that [the requesting individual] could appropriately recommend to the Trustees that they invite the parties to the litigation to discuss the matter at a general or special meeting of the Board without violating Public Officers Law §74. However, in doing so, he must be careful not to participate in discussions in a manner precluded by this opinion. To avoid this possibility, his recommendation must be made at a public meeting of the Board, and any discussion on [the requesting individual's] part regarding his recommendation must be limited to the procedural rather than the substantive reasons for inviting the parties together. His recommendation should be presented without bias or an attempt to influence the outcome, leaving the other Board members free to accept or reject such a recommendation.

If such a public meeting of the parties were held, [the requesting individual] would be required to recuse himself from participation in any discussion. With regard to his posing questions, this may, at first, appear to be a neutral role. However, questions are not necessarily neutral, as they can often be framed in an argumentative fashion. Thus, there would be no way of assuring that [the requesting individual's] inquiries would not, in effect, be a means of his participating in the substantive discussions. He may, therefore, not participate by asking questions.

3. Could [the requesting individual], with Board approval, act as a mediator in the State court action?

Even if [the requesting individual] were to endeavor to play a neutral role as a mediator, his prior efforts in working with the plaintiffs would create at least the appearance of bias. Under these circumstances, a conflict of interest or the appearance of a conflict cannot be avoided. While [the requesting individual's] unique vantage might actually serve the State's interest by his acting in a mediation setting, the Commission concludes [the requesting individual's] participation as a mediator would create the appearance of a conflict prohibited by §74.

4. As a former advisor to the Fund, may [the requesting individual] vote on procedural and/or more substantive matters relating to the State court action? May he participate in executive sessions of the Board pertaining to litigation strategy in the State court action?

For the reasons previously discussed, Public Officers Law §74 would preclude [the requesting individual] from voting on any matter pertaining to the State court action. Any such participation might also raise questions under the Code of Professional Responsibility, although, as noted earlier, that is not a matter for the Commission.

In addition, [the requesting individual] should absent himself from any executive session of the Board where [the University's] litigation strategy is discussed. Having shared confidences with the plaintiffs and their attorneys, he cannot now be part of the sharing of confidences with the defendants.

5. To what extent may [the requesting individual], consistent with his ethical duties and obligations, provide fellow trustees, members of the State government or any other individuals with a copy of his opinion request?

Executive Law §94(15) requires that the Commission maintain the confidentiality of advisory opinion requests. It authorizes the Commission to publish its opinions, but the name of the individual requesting the opinion and other identifying details must be omitted. The Commission has, on occasion, published the name of the requesting individual when he or she has authorized it to do so.

There is no statute prohibiting an individual requesting an opinion from making copies of his or her request available to the public. Thus, [the requesting individual] is free to disseminate his request. However, the Commission cautions [the requesting individual] that his request outlines some of the arguments that he is otherwise prohibited from presenting to the Trustees, and if his distribution of the request letter is seen as having no purpose other than to offer these arguments, his action could present §74 concerns.

CONCLUSION

The Commission concludes that, given [the requesting individual's] prior association with the plaintiffs and their attorneys in legal actions brought against [the University], Public Officers Law §74 requires that, as a [University] Trustee, he must: (1) disclose to the Board of Trustees such prior associations, and recuse himself from participating in matters surrounding the pending litigation; (2) absent himself from any executive session of the Board in which litigation strategy is discussed; and (3) and refrain from speaking before any civic or fraternal organization regarding the litigation or related issues. [The requesting individual] may recommend, without argument, to the Trustees at a public meeting of the Board that they invite both sides to the dispute to attend a future public meeting.

This opinion, until and unless amended or revoked, is binding on the Commission in any subsequent proceeding concerning the person who requested it and who acted in good faith, unless material facts were omitted or misstated by the person in the request for opinion or related supporting documentation.

All concur:

Evans V. Brewster
Angelo A. Costanza
Robert E. Eggenschiller
Donald A. Odell, Members

Dated: March 17, 1997


Endnotes

1. The information contained in this section has been largely excerpted from [the requesting individual's request letter, [ ].

2. [The requesting individual] has described the Fund's mission as "analogous to that of organizations such as the NAACP, the ACLU or the Puerto Rican Legal Defense Fund."

3. [Cite deleted.]

4. Section 73 provides that uncompensated board members are not State employees for purposes of that section.

5. Public Officers Law §74, the code of ethics, defines the term "state agency" as "any state department, or division, board, commission, bureau of any state department or any public benefit corporation or public authority at least one of whose members is appointed by the governor."

6. The Commission has issued a number of advisory opinions affecting [the University] employees in a variety of contexts under its jurisdiction: financial disclosure requirements for those serving in academic titles (Advisory Opinions No. 90-15, 92-15, 93-6); State employees serving on the [University] faculty (Advisory Opinion No. 93-14); recognizing the relationship between [the university] and its Research Foundation (Advisory Opinion No. 91-20, 93-3, 95-2).

7. 1979 Op. Atty. Gen. 66.

8. See Advisory Opinion Nos. 93-16, concerning a Board member voting on applications from members of two private organizations which employed him; No. 93-17, concerning a Board member representing clients before his Board or a related State agency; No. 95-18, regarding the impact of current employment relationships; and No. 95-27, concerning members of the Public Health Council appearing before the Department of Health.

9. [The requesting individual] is an attorney admitted to practice in New York.

10. 10 [The requesting individual] has asked the Commission to consider two court decisions: Pickering v Board of Education, 391 U.S. 563 (1968) and Scotch Plains-Fanwood Board of Education v Syvertsen, 251 N.J.Super 566 (1991). The Commission has reviewed these decisions and believes each can be distinguished.

In Pickering, The United States Supreme Court held that a school teacher could not be dismissed for writing letters critical of the school board and the district superintendent because the First Amendment protected him from an act of retaliation by his employer. Here, [the requesting individual] serves for a seven year term, and has no reason to fear retaliation.

In Scotch Plains, the Superior Court of New Jersey held that a school board member who had brought a legal action against the board was properly excluded from participating in an executive session of the board at which litigation strategy was discussed, but could not be excluded from a public session. There, however, there was no issue of the individual's having been part of confidential communications with the boards' adversaries. Thus, the ethical concerns present here did not arise.



URL: http://www.nysl.nysed.gov/edocs/ethics/97-08.htm