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FREIVOGEL ON CONFLICTS WHAT'S NEW Items posted here during the past thirty days will also appear on this What's New page. Items posted within the past ten days will appear In Ten Day Bulletin immediately below. Items older than ten days but less than 30 days will be posted in the Thirty-Day Holding Area, which follows. Ten Day Bulletin Important Note on Web Security As of April 15, 2023, this Web site has been rendered "secure." This means we have obtained "SSL Certificates" for www.freivogel.com and www.freivogelonconflicts.com. If IT personnel in your organization have either cautioned you about use of this site, or restricted your access to it, you should call this change in status to their attention. Former Client (posted September 18, 2023) Rose v. Francis, No. 5:22-civ-00405 (S.D. W. Va. Sept. 15, 2023). Former inmates, represented by Law Firm, brought this class action against a state prison authority (“Agency”). While this case was pending, Law Firm hired Lawyer. Lawyer had previously represented Agency in one case involving an employment/discrimination claim and did only discovery work in that case. Nevertheless, Defendants moved to disqualify Law Firm in this case. In this opinion the court denied the motion, finding that the employment claim was not substantially related to this inmate class action. The court noted that Agency was a public body and anything Lawyer might have learned about Agency either was public, or would become public in the course of this case. Former Client; Playbook (posted September 15, 2023) Axle of Dearborn, Inc. v. Detroit IT, LLC, No. 21-cv-10163 (E.D. Mich. Sept. 13, 2023). Plaintiffs are suing Defendants for technology-related wrongs, including hacking and extortion. Law Firm represents several Defendants. Prior to 2023 Law Firm had represented Plaintiff Axle on various matters, none directly related to Defendants. Plaintiffs moved to disqualify Law Firm in this case. In this opinion the court granted the motion. The decision was so fact-intensive that a review of the various factual issues would not be productive. It is important to note that the court relied very heavily on playbook information, such as the habits and inclinations of Axle management. Anyone wishing to emphasize playbook information to establish a substantial relationship under Rule 1.9 would do well to start with this opinion. Malpractice Liability (posted September 13, 2023) 810 Woodward Ave., LLC v. Bolton, 2023 WL 5926945 (Super. Ct. Conn. New Haven Sept. 7, 2023). Landlord sued Tennant for overdue rent. They settled. Tennant gave check to Tennant's lawyer to hold in trust account for Landlord. Before Tennant's lawyer could give the funds to Landlord, Tennant had a change of heart and ordered Tennant's lawyer to return the funds to Tennant, which he did. Landlord brought this case against Tennant's lawyer for breach of fiduciary duty, conversion and theft. After a bench trial the court found for Tennant's lawyer, as set forth in this opinion. The essence of the ruling is that Tennant's lawyer's duty was to follow his client's directions and return the money to his client. To find a duty to the opposition party in this circumstance "would create a conflict of interest. The law ought not proceed in this direction." Current Client (posted September 11, 2023) Hamed v. Diaz, No. 514433/2019 (N.Y. Sup. Ct. Kings County Sept. 6, 2023). In this medical malpractice case, involving a State of N.Y. facility, the Attorney General's Office ("OAG") is defending a doctor. In another case, involving the same events, Plaintiff is suing the State of New York. OAG is defending that case, as well. Plaintiff moved to disqualify OAG in this case, claiming both representations are in conflict. In this opinion the court denied the motion, holding that the doctor's and State's interests are aligned. A complication is that the doctor is suing the State for wrongful termination. The OAG is not in that case, however. Plus, the grounds for termination did not involve the alleged malpractice in this case. MISCELLANEOUS ETHICS AND LIABILITY NEWS [Note: Items that do not fit under the conflicts categories below, but which we believe will be of interest to this audience will appear here at This and That. Nothing current. [Note: These, too, will appear at the This and That pages.] Nothing current. APPEALABILITY (To read full article, click here.) Nothing current. ARBITRATION OF MALPRACTICE CLAIMS (To read the full article, click here. Nothing current. BANKRUPTCY (To read full article, click .) Nothing current. BANKS/TRUST DEPARTMENTS (To read full article, click here.) Nothing current. BOARD POSITIONS (To read full article, click here Nothing current. CHANGING FIRMS - SCREENING (To read full article, click here.) Nothing current. CLASS ACTIONS (To read full article, click here.) Nothing current. CO-COUNSEL/COMMON INTEREST (To read full article, click here.) Nothing current. COMMERCIAL NEGOTIATIONS (To read full article, click .) Nothing current. CORPORATIONS (To read full article, click here.) Nothing current. CORPORATE FAMILIES (To read full article, click here.) Nothing current. CRIMINAL PRACTICE (To read full article, click here.) Nothing current. CURRENT CLIENT (To read full article, click here.) (posted September 11, 2023) Hamed v. Diaz, No. 514433/2019 (N.Y.
Sup. Ct. Kings County Sept. 6, 2023). In this medical malpractice case,
involving a State of N.Y. facility, the Attorney General's Office
("OAG") is defending a doctor. In another case, involving the same
events, Plaintiff is suing the State of New York. OAG is defending that
case, as well. Plaintiff moved to disqualify OAG in this case, claiming
both representations are in conflict. In this opinion the court denied
the motion, holding that the doctor's and State's interests are aligned.
A complication is that the doctor is suing the State for wrongful
termination. The OAG is not in that case, however. Plus, the grounds for
termination did not involve the alleged malpractice in this case. Third-Party Action (posted August 23, 2023) Colon v. World Mission Soc'y,
2023 WL 5281835 (Super. Ct. N.J. Unpub. Aug. 17, 2023). Defendants
moved to disqualify the lawyer ("Lawyer") for the plaintiff and the
third-party defendant. The trial court denied the motion. In this
unpublished opinion the appellate court affirmed. The facts are (to us) a
bit murky, but the upshot is that representing a plaintiff and
third-party defendant is not always a conflict. The trial court found
that the clients "do not take positions adverse to one another."
Moreover, both parties signed conflict waivers allowing Lawyer to
represent them both. The trial court also suggested that the defendant
need not have brought the third-party claims (contribution and
indemnification) "now." [Our note: Normally, a third-party defendant
seeks to oppose the plaintiff's claim as well as the defendant's
third-party claim. Why that tack would not benefit the third-party
defendant in this case is not clear.] DERIVATIVE ACTIONS (To read full article, click here.) Nothing current. ENJOINING CONFLICTS (AND OTHER NON-TRADITIONAL REMEDIES) (To read full article, click here.) Nothing current. EXPERT WITNESSES (To read full article, click here.) Party as Expert (posted September 7, 2023) G.W. Aru, LLC v. W.R. Grace & Co.,
No. JKB-22-2636 (D. Md. Aug. 22, 2023). Patent infringement case.
Plaintiff Aru moved for a preliminary injunction and attached a lengthy
declaration of Aru's owner, containing expert opinions. Grace moved to
strike portions of the declaration because it contained "improper and
inadmissible evidence." In this opinion the court denied the motion to
strike. The supposed conflict of interest of the declarant was not an
issue in the motion or the court's order. However, the court mentioned
the conflict in a footnote (No. 1), citing two leading cases in which a
party was an expert witness: Tagatz v. Marquette Univ., 861 F.2d 1040
(7th Cir. 1988) (despite "so obvious a conflict of interest"); and
Patterson v. Santini, 2017 WL 11454838 (D. Colo. Mar. 20, 2017)
(collecting cases). FORMER CLIENT (To read full article, click here.) (posted September 18, 2023) Rose v. Francis, No. 5:22-civ-00405
(S.D. W. Va. Sept. 15, 2023). Former inmates, represented by Law Firm,
brought this class action against a state prison authority (“Agency”).
While this case was pending, Law Firm hired Lawyer. Lawyer had
previously represented Agency in one case involving an
employment/discrimination claim and did only discovery work in that
case. Nevertheless, Defendants moved to disqualify Law Firm in this
case. In this opinion the court denied the motion, finding that the
employment claim was not substantially related to this inmate class
action. The court noted that Agency was a public body and anything
Lawyer might have learned about Agency either was public, or would
become public in the course of this case. Playbook (posted September 15, 2023) Axle of Dearborn, Inc. v. Detroit IT, LLC,
No. 21-cv-10163 (E.D. Mich. Sept. 13, 2023). Plaintiffs are suing
Defendants for technology-related wrongs, including hacking and
extortion. Law Firm represents several Defendants. Prior to 2023 Law
Firm had represented Plaintiff Axle on various matters, none directly
related to Defendants. Plaintiffs moved to disqualify Law Firm in this
case. In this opinion the court granted the motion. The decision was so
fact-intensive that a review of the various factual issues would not be
productive. It is important to note that the court relied very heavily
on playbook information, such as the habits and inclinations of Axle
management. Anyone wishing to emphasize playbook information to
establish a substantial relationship under Rule 1.9 would do well to
start with this opinion. (posted September 6, 2023) Nowarta Biopharma, Inc. v. Merchant Star Int'l Gen. Trading, LLC,
2023 WL 5659685 (Cal. App. 4th Dist. Unpub. Sept. 1, 2023). Nowarta is
suing Merchant for breach of contract. Nowarta moved to disqualify
Merchant's law firm ("Law Firm"). Three of Merchant's owners are lawyers
in Law Firm. Law Firm had represented Nowarta in the past. One Law Firm
lawyer was Nowarta's general counsel "for nearly three years,"
including when the "transactions at issue" in this case occurred. The
trial court granted the motion to disqualify. In this unpublished
opinion the appellate court affirmed. The matters were clearly
substantially related. Law Firm claimed that if it were disqualified, a
new law firm would have access to the information of the Law Firm
lawyers who were owners of Merchant. "No," said the appellate court.
Those lawyers are barred by Cal. Bus. & Prof. Code, § 6068 (e) and
Cal. Rule 1.6(a) from revealing anything they learned about the
underlying transactions. (posted August 31, 2023) LCC Enters. LLC v. Cresto, 2023 WL
5519336 (S.D. Cal. Aug. 24, 2023). Plaintiff purchased Company from
Defendants ("The Sale"). Plaintiff is suing Defendants for fraud and
related wrongs because Defendants did not disclose Company's problems
prior to The Sale. Plaintiff moved to disqualify Defendants' law firm in
this case ("Law Firm") because Law Firm had represented Company before
The Sale. In this opinion the court granted the motion to disqualify.
Before The Sale, Law Firm had assisted Company in responding to claims
by third parties. These claims appear to have been matters Plaintiff is
claiming were not disclosed by Defendants prior to The Sale. Thus, the
matters are substantially related. [Our note: We are not certain that
the opinion holds together. For example, the court responded to
Defendant's standing argument, by holding simply that in the Ninth
Circuit standing is not a requirement for a motion to disqualify. As to
the main issue, we will leave it to our California friends to determine
whether the court's analysis of California's substantial-relationship
jurisprudence is sound.] (posted August 28, 2023) BeSang, Inc. v. Intel Corp., 2023 WL
5499982 (D. Ore. Aug. 25, 2023). To read about the case, go to "Initial Interview . . . " below. Playbook (posted August 21, 2023) Morgan v. Ford Motor Co.,
2023 WL 5314893 (Mich. App. Unpub. Aug. 17, 2023). Auto accident
resulting in this product liability suit against Ford. Plaintiff alleges
that the seat in front of Plaintiff was defective. Plaintiff’s lawyer
(“Lawyer”) had represented Ford in seat cases until 2009. Ford moved to
disqualify Lawyer in this case. The trial court granted the motion. In
this 2-1 unpublished opinion the appellate court vacated the
disqualification and remanded the issue to the trial court “to
determine whether plaintiff obtained specific knowledge about Ford's
defense strategies that would be prejudicial to Ford in the instant
matter.” It should be noted that the seats in question were re-designed
after Lawyer stopped representing Ford. Nevertheless, the dissenter
thought the prejudice to Ford if Lawyer remained was clear. Stay tuned. Nothing current. HOT POTATO DOCTRINE (To read full article, click here.) Nothing current. INITIAL INTERVIEW - HEARING TOO MUCH (To read full article, click here.) (posted August 28, 2023) BeSang, Inc. v. Intel Corp., 2023 WL
5499982 (D. Ore. Aug. 25, 2023). Patent infringement case. Plaintiff
moved to disqualify the law firm for Defendant ("Law Firm"). In this
opinion the court denied the motion. The opinion is highly fact-specific
and a routine analysis. But, it illustrates a workman-like approach by
the court to Rules 1.9 and 1.18--in a technology setting. Law Firm had
three earlier contacts with Plaintiff. The first resulted in a brief
representation, which the court found to have no relevance to the patent
issues in this case, and thus no substantial relationship under Rule
1.9. The other contacts did not result in representation, but were in
the "prospective client" category, resulting in an analysis under Rule
1.18. In both cases the court found that the information Plaintiff
shared with Law Firm would not be "significantly harmful" to Plaintiff
in this case. INSURANCE DEFENSE (To read full article, click here.) Reservation of Rights (posted September 1, 2023) Mid-Continent Cas. Co. v. Harris County Mun. Util. Dist.,
2023 WL 5621664 (Tex. App. Aug. 31, 2023). Plaintiff sued Dist. and two
directors claiming Plaintiff lost his election to the board due to
Defendant misconduct. Defendants turned the case over to the district's
D&O insurance company ("InsCo"). InsCo agreed to defend under a
reservation of rights, mentioning a possible policy exclusion. Because
District's lawyer perceived that there were "potential" conflicts among
the Defendants, Defendants rejected InsCo's offer to provide one lawyer
for all Defendants. Each Defendant hired separate counsel to defend
them. After Plaintiff dismissed the case, InsCo refused to pay for the
separate lawyers. So, Defendants brought this case to recover those
defense costs. The trial court found against InsCo. In this opinion the
appellate court reversed, finding that Defendants failed to show an
"actual" conflict among them, thus failing to justify hiring separate
counsel. The court discussed the kinds of conflict that would have
justified hiring separate counsel, the principal one being when the case
being tried could have decided application of the policy exclusion.
Those kinds of conflicts were not in this case. INVESTING IN CLIENTS/STOCK FOR FEES (To read full article, click here.) Nothing current. Nothing current. JOINT/MULTIPLE REPRESENTATION (To read full article, click here.) Nothing current. Nothing current. Nothing current. MALPRACTICE LIABILITY/FEE FORFEITURES (To read full article, click here.) (posted September 13, 2023) 810 Woodward Ave., LLC v. Bolton,
2023 WL 5926945 (Super. Ct. Conn. New Haven Sept. 7, 2023). Landlord
sued Tennant for overdue rent. They settled. Tennant gave check to
Tennant's lawyer to hold in trust account for Landlord. Before Tennant's
lawyer could give the funds to Landlord, Tennant had a change of heart
and ordered Tennant's lawyer to return the funds to Tennant, which he
did. Landlord brought this case against Tennant's lawyer for breach of
fiduciary duty, conversion and theft. After a bench trial the court
found for Tennant's lawyer, as set forth in this opinion. The essence of
the ruling is that Tennant's lawyer's duty was to follow his client's
directions and return the money to his client. To find a duty to the
opposition party in this circumstance "would create a conflict of
interest. The law ought not proceed in this direction." OF COUNSEL (To read full article, click here.) Nothing current. OPPOSING LAWYERS NEGOTIATING A LAW PRACTICE MERGER (To read full article, click here.) Nothing current. PARTNERSHIPS (INCLUDING LIMITED PARTNERSHIPS) (To read full article, click here.) Nothing current. SETTLEMENT AGREEMENTS (To read full article, click here.) Nothing current. STANDING (To read full article, click here.) Nothing current. Nothing current. UNDERLYING WORK PROBLEM (To read full article, click here.) Nothing current. WAIVERS/CONSENTS (To read full article, click here.) Nothing current. WITNESS - ADVERSE - CURRENT/FORMER CLIENT (To read full article, click here.) Nothing current. ZERO SUM GAMES (To read full article, click here.) Nothing current. Home/Table of Contents Website powered by Network Solutions® |