Could you answer me the following hypothetical legal situation from the TV series "Suits" (S08E15)

I think that episode was probably a little weak on reality.

In fact this type of situation comes up occaisonally in corporate law, and the rule is simple: If you represent both clients you have an equal duty to each one.

So, you inform the big guy that you have to disclose what you know and you tell the little guy. But before you do anything you give the principal client the opportunity to seek other council, and offer mediation to both parties in order resolve conflicts or disputes.

It works out, but the results are usually less dramatic and don’t make for good TV ;)

By the way, this situation is called “concurrent conflict of interest” and its carefully addressed in the ABA Rules of Professional Practice.

The waiver provision is the key.