Under what circumstance can a lawyer also represent shareholders or employees of an organization?

The correct answer regarding the circumstances under which a lawyer can represent shareholders or employees of an organization alongside the organization itself is based on compliance with concurrent client exception rules. These rules are grounded in the concepts of conflict of interest and professional responsibility that lawyers must adhere to when representing multiple clients.

For a lawyer to simultaneously represent different clients (such as an organization and its shareholders or employees), they must ensure that there are no conflicts of interest that would impair their ability to represent each client effectively. This requires the lawyer to obtain informed consent from all parties involved after fully disclosing the nature of the relationship and the possible implications of joint representation. If the clients can provide such consent and understand the potential conflicts, the lawyer can proceed with the representation.

In this context, while it might seem that factors like mutual benefit or professionalism would allow for representation, the central governing issue is the adherence to the rules concerning concurrent representation. Without compliant practices regarding conflicts of interest and informed consent, a lawyer risks violating ethical standards, which can lead to professional misconduct. Therefore, the necessity to follow the concurrent client exception rules is paramount in ensuring that the lawyer operates within the ethical guidelines set forth by the California Bar.