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Bank Hapoalim B.M. v. WestLB AG

Appellate Division of the Supreme Court of New York, First Department
Mar 3, 2011
82 A.D.3d 433 (N.Y. App. Div. 2011)

Summary

In Bank Hapoalim B.M. v. WestLB AG, 82 A.D.3d 433, 918 N.Y.S.2d 49 (2011), we affirmed the disqualification of Reed Smith as counsel for the plaintiffs, including the plaintiff in this action, in a suit claiming that defendants had engaged in negligent and fraudulent conduct in mismanaging the plaintiffs' investments.

Summary of this case from Justinian Capital SPC v. WestLB AG

Opinion

No. 4414N.

March 3, 2011.

Order, Supreme Court, New York County (Shirley Werner Kornreich, J.), entered August 23, 2010, which granted defendants' motion to disqualify Jordan W Siev and Reed Smith LLP as counsel for plaintiffs, unanimously affirmed, without costs.

Bruce Green, New York, for appellants.

Hughes Hubbard Reed LLP, New York (Christopher M. Paparella of counsel), for respondents.

Before: Saxe, J.P., Sweeny, Catterson, Freedman and Román, JJ.


As a preliminary matter, counsel's conduct in taking on the conflicting representation is governed by the Code of Professional Responsibility, which was in effect at the time of the conduct, rather than by the Rules of Professional Conduct, which were in effect when the motion to disqualify was brought ( see Lee v Cintron, 25 Misc 3d 1210[A], 2009 NY Slip Op 52023[U], *2 [2009]; see generally Matter of Hays v Ward, 179 AD2d 427, 429, lv denied 80 NY2d 754).

Code of Professional Responsibility DR 5-108 ( 22 NYCRR 1200.27) prohibits an attorney from "representing interests adverse to a former client on matters substantially related to the prior representation" ( Tekni-Plex, Inc. v Meyner Landis, 89 NY2d 123, 130). Although defendants' initial consultation about taking on the defense of the case did not lead to counsel's retention, defendants' description of the matters, coupled with the circumstances surrounding the meeting, gives rise to a reasonable inference that confidences were revealed, which establishes a fiduciary relationship of loyalty with respect to those communications ( see Rose Ocko Found, v Liebovitz, 155 AD2d 426, 427; Pellegrino v Oppenheimer Co., Inc., 49 AD3d 94, 99).


Summaries of

Bank Hapoalim B.M. v. WestLB AG

Appellate Division of the Supreme Court of New York, First Department
Mar 3, 2011
82 A.D.3d 433 (N.Y. App. Div. 2011)

In Bank Hapoalim B.M. v. WestLB AG, 82 A.D.3d 433, 918 N.Y.S.2d 49 (2011), we affirmed the disqualification of Reed Smith as counsel for the plaintiffs, including the plaintiff in this action, in a suit claiming that defendants had engaged in negligent and fraudulent conduct in mismanaging the plaintiffs' investments.

Summary of this case from Justinian Capital SPC v. WestLB AG
Case details for

Bank Hapoalim B.M. v. WestLB AG

Case Details

Full title:BANK HAPOALIM B.M. et al., Appellants, v. WESTLB AG et al., Respondents

Court:Appellate Division of the Supreme Court of New York, First Department

Date published: Mar 3, 2011

Citations

82 A.D.3d 433 (N.Y. App. Div. 2011)
2011 N.Y. Slip Op. 1586
918 N.Y.S.2d 49

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