Advisory Opinion No. 2005-56 Re: John Aloysius Cogan, Jr., Esq. QUESTION PRESENTED: The petitioner, the Executive Assistant for Policy and Program Review in the Office of Health Insurance Commissioner, a state employee position, requests an advisory opinion as to whether he may participate in two matters related to Blue Cross & Blue Shield of Rhode Island, given that his former employment as an attorney at Partridge, Snow & Hahn, LLP, involved representing Blue Cross & Blue Shield of Rhode Island in matters unrelated to those over which the Office of Health Insurance Commissioner has jurisdiction. RESPONSE: It is the opinion of the Rhode Island Ethics Commission that the Code of Ethics does not prohibit the petitioner, the Executive Assistant for Policy and Program Review in the Office of Health Insurance Commissioner, a state employee position, from participating in two matters related to Blue Cross & Blue Shield of Rhode Island, despite the fact that his former employment as an attorney at Partridge, Snow & Hahn, LLP, involved representing Blue Cross & Blue Shield of Rhode Island in matters unrelated to those over which the Office of Health Insurance Commissioner has jurisdiction. The petitioner represents that in June of 2005 he began employment as an Executive Assistant for Policy and Program Review for the Office of Health Insurance Commissioner (“OHIC”), a state agency. He informs that his official duties include providing legal advice and representation, acting as hearing officer at agency hearings, and appearing on behalf of the agency in state and federal courts. He informs that the OHIC has jurisdiction over the enforcement of all laws relating to health insurance. He represents that the OHIC’s powers include enforcing the health insurance laws, conducting hearings related to health insurance issues, issuing administrative penalties, conducting public meetings, and taking other health insurance-related actions. Prior to this employment, the petitioner states that he worked from March of 2003 to January of 2005 for the Providence, Rhode Island law firm of Partridge, Snow & Hahn, LLP (“PSH”). While at PSH, the petitioner informs that he worked on health care, corporate, and litigation matters for various clients. He represents that one of the clients he represented at PSH was Blue Cross & Blue Shield of Rhode Island (“Blue Cross”). The petitioner states that he worked on various Blue Cross matters, including state and federal court litigation, corporate matters related to Blue Cross’ Medicare managed care contract, and other minor matters. With regard to his representation of Blue Cross, the petitioner informs that he was not “personally and substantially” involved in the provision of legal services related to any matter under the jurisdiction of the Department of Business Regulation (“DBR”), which the petitioner represents is the predecessor agency to the OHIC. During his employment at PSH, the petitioner states that the DBR had sole jurisdiction over health insurance matters because the OHIC did not commence operations until March of 2005. In January of 2005, the petitioner represents that he resigned from PSH and received his last paycheck from PSH. Prior to accepting employment with the OHIC, the petitioner informs that he fully disclosed to the Commissioner of Health Insurance the details of his prior employment, including the work he did on behalf of Blue Cross. Additionally, the petitioner informs that, prior to accepting employment at OHIC, he contacted the managing partner at PSH and informed him that he was considering working at the OHIC. He states that this partner did not express any concerns about his employment at OHIC and, after sharing these intentions with Blue Cross, told him that Blue Cross also had no concerns about such employment. The petitioner informs that various matters related to Blue Cross have arisen at the OHIC and that the Commissioner has requested his legal assistance on two matters involving Blue Cross. First, the petitioner informs that the Commissioner has appointed him to serve as a hearing officer on a matter regarding Blue Cross’ request for a rate increase for one of its insurance products. Second, the petitioner informs that the Commissioner has asked him to provide legal advice with respect to a request by the Attorney General for a declaratory ruling by the OHIC related to Blue Cross’ proposed development of a for-profit health and wellness institute. With respect to both of these matters, the petitioner discloses that the Attorney General has requested that the Commissioner disqualify him from any involvement because of his former employment by PSH and his former representation of Blue Cross. He informs that the Attorney General has also filed a motion to disqualify him as a hearing officer based upon the Rhode Island Rules of Professional Conduct for Rhode Island attorneys and Article III, Section 7 of the Rhode Island Constitution. The petitioner informs that he is requesting this opinion to determine whether a conflict of interests exists if he participates in these OHIC matters involving Blue Cross given his previous employment at a law firm that represents an entity (Blue Cross) regulated by the OHIC. Pursuant to the Code of Ethics, the petitioner may not participate in any matter in which he has an interest, financial or otherwise, which is in substantial conflict with the proper discharge of his duties in the public interest. R.I. Gen. Laws § 36-14-5(a). A substantial conflict of interest occurs if it is reasonably foreseeable that he or any family member or business associate, or any business by which he is employed, will derive a direct monetary gain or suffer a direct monetary loss by reason of his official activity. R.I. Gen. Laws § 36-14-7(a); Regulation 36-14-7001. The Code of Ethics also prohibits the petitioner from using his public position or confidential information received through his position to obtain financial gain, other than that provided by law, for himself, a business associate, employer, or family member. R.I. Gen. Laws § 36-14-5(d). Furthermore, the petitioner may not participate in a matter concerning or presented by a business associate unless the associate first advises the official’s agency of the nature of the association and the petitioner recuses himself from voting or otherwise participating in his agency’s consideration of the matter at issue. R.I. Gen. Laws § 36-14-5(f). Under the Code of Ethics, a business associate is defined as an individual or business entity joined with an official to achieve a common financial objective. See R.I. Gen. Laws §§ 36-14-2(3) and 2(7). The petitioner represents that while employed at PSH he represented Blue Cross in matters unrelated to those over which the OHIC has jurisdiction. He stresses that he has no continuing business, financial, or employment relationship with PSH or Blue Cross. He states that he neither works for PSH nor represents Blue Cross. He informs that he does not receive any contract work or referrals from PSH. He represents that none of his family members work for PSH or Blue Cross and that he has no business or financial connection, either direct or indirect, to anyone who works for PSH or Blue Cross. Furthermore, the petitioner informs that he has no reason to believe or expect that a direct or indirect financial gain or loss will accrue to him, his family, his friends, or any business associate of his by reason of his participation in any OHIC regulatory action involving Blue Cross or PSH. The petitioner further informs that he will not use his position, or confidential information received through his position, to obtain financial gain other than that provided for by law. Previously, the Commission has opined that an ongoing attorney-client relationship creates a business association that triggers the prohibitions set forth in R.I. Gen. Laws §§ 36-14-5(a) and 5(f). See, e.g., A.O. 98-142; A.O. 98-25. Conversely, the Commission has consistently opined that no conflict of interest exists when a prior business relationship between a public official and a private party has ended and there is no ongoing or anticipated future relationship between the parties. In such instances, a public official may participate in matters involving his or her former business associate, assuming no other conflicts are present. See, e.g., A.O. 2004-26 (opining that the petitioner, a member of the North Smithfield Planning Board, a municipal appointed position, may participate and vote in matters before his Board in which petitioner’s former, private attorney appears given that they do not have a current business association for purposes of the Code of Ethics); A.O. 98-25 (opining that a Bristol Planning Board member may participate in a matter in which an attorney represents an applicant before that Board, despite the fact said attorney previously represented the member on an unrelated matter). Here, the petitioner represents that the attorney/client relationship between himself and Blue Cross, and his employment relationship with PSH, terminated months ago and that he no longer has any business association with Blue Cross or PSH. Accordingly, the Commission opines that the petitioner’s participation in the two aforementioned matters handled by the OHIC related to Blue Cross will not violate the Code of Ethics despite the fact that the petitioner’s former employment by PSH as an attorney involved representing Blue Cross. The petitioner is advised that this opinion solely addresses whether the Code of Ethics prohibits him from participating in matters handled by the OHIC related to Blue Cross, given his former employment as an attorney at PSH representing Blue Cross in matters unrelated to those over which the OHIC has jurisdiction. This opinion does not, and cannot, address the Rules of Professional Conduct applicable to Rhode Island attorneys or any other statutes, regulations, rulings, or policies that may regulate such conduct. Code Citations 36-14-2(3) 36-14-2(7) 36-14-5(a) 36-14-5(d) 36-14-5(f) 36-14-7(a) Regulation 36-14-7001 Rhode Island Constitution Art. III, § 7 Related Advisory Opinions: 2004-26 98-142 98-25 Keywords: Business Associate