Opinion
No. 5100775
December 7, 2007
MEMORANDUM OF DECISION RE SUPPORT OF MOTION TO DISQUALIFY
Background
This vigorously contested matter arose when an associate attorney employed by the firm representing the Plaintiff in this case left that firm's employment and was employed by the firm representing the defendant, Charlene Therell (the defendant).
The plaintiff has moved to disqualify the entire firm of Bai, Pollock, Blueweiss Mulcahey, P.C. (Bai firm) from representing the defendant. The defendant has objected to the granting of the motion and assert her right to select counsel of her choice.
A hearing was held before this court on November 11, 2007, at which all parties were represented by counsel, presented evidence and advanced arguments in support of their respective positions. Briefs had been previously filed by the parties.
Facts
From the evidence offered at the hearing, including reasonable and logical inferences from the same, and considering the court's evaluation of the credibility of the witnesses, the following facts are found material to the decision on the motion.
Attorney Sarah Schlechtweg (the associate) was employed by the firm of Beebe and O'Neil (plaintiff's attorney) at the time that firm represented the plaintiff in this pending litigation. During that time, and without knowing who was representing the defendant, the associate met with the plaintiff, worked on her file and prepared the plaintiff for a deposition. In this regard the associate had an attorney-client relationship with the plaintiff. The associate charged 27 hours to work on that case. (Plaintiff's Exhibit 1.) At or about the same time, and without informing the principals in the plaintiff's attorneys firm, the associate was seeking other employment.
When the associate was offered a position with the Bai firm on or about August 1, 2007, she immediately informed Attorney Beebe she would be leaving. An acrimonious discussion followed. The associate met with the plaintiff after that, but before she learned that the Bai firm represented the defendant. As soon as she learned of the situation she sought and received advise from the Bai firm. Soon thereafter she left the employ of the plaintiff's attorney and started work for the Bai firm on August 13, 2007.
Immediately when the associate arrived at the Bai firm a so-called "Chinese Wall" was created. The method used for that purpose involved several steps. (Defendant's Exhibit 2.) Before the new associate began work, she was instructed that she was not to see the file in their office, not to talk with anyone about the case and if she was asked about the file to let them know she was not permitted to discuss the file. The Bai firm's activities are divided into two separate divisions: general litigation and medical malpractice. Her assignment in the Bai firm was limited to the medical malpractice division. Her office was in a different location from attorneys or other staff working on the Laprise file. The plaintiff's case was being handled in the general litigation division. She was not permitted to see any files in the general litigation division. She was denied access to the file room used for general litigation files. Also, on the same day as the associate arrived a memo was sent to all employees of the Bai firm informing them of the restrictions on the associate's activities as it related to that case. A special label was placed on the file to inform anyone that the associate was not allowed access to the file. The associate has thus been both organizationally and physically separated from the case at bar in the Bai firm.
The plaintiff's attorney informed the Bai firm that it and the client they represented objected to the situation of the Bai firm's continued representation of the defendant in light of the associate's relocation to their firm. The Bai firm informed them of the restrictions imposed on the associate and that under those circumstances it was of the opinion that the rules did not require disqualification. (Defendant's Exhibit 2.)
The associate has not spoken to anyone at the Bai firm about this case, has not looked at the file or any other file in the general litigation division, has not had access to the file room for the general litigation files and has not shared information about the plaintiff with anyone at the Bai firm since her employment. The associate has, however, had discussions with the Bai firm attorney handling this litigation for the defendant (Attorney Lerman) to the extent required to resist this motion which did not involve disclosing any information learned from her contact with the plaintiff.
The Bai firm, although engaged by an insurance company, has had contact with the defendant, met with her and she wants the Bai firm to provide her with representation.
There has been no showing by the plaintiff at the hearing of any betrayal of trust by the associate or any indication that the Bai firm has gained any advantage in this case by the circumstances of the change of employment of the associate and it is found that there was none.
The Issue
The issue is whether the creation of the so-called "Chinese Wall" has the effect of avoiding the application of the rules that otherwise might required disqualification of the entire Bai firm.
The Claims of the Parties
In her brief the plaintiff claims the application of Section 1.10 of the Rules of Professional Conduct (which incorporate Section 1.7 and 1.9) preclude the Bai firm from representing the defendant with the following language:
"Rule 1.10 states that "(a) While lawyers are associated in a firm, none of them shall knowingly represent a client when any one of them practicing alone would be prohibited from doing so by Rule 1.7 or 1.9." Rule 1.7, addressing conflict of interest issues between current clients, mandates that: a lawyer shall not represent a client if the representation involves a concurrent conflict of interest. A concurrent conflict of interest exists if . . . (2) There is a significant risk that the representation of one or more clients will be materially limited by the lawyer's responsibilities to another client, a former client or a third party person or by a personal interest of the lawyer." "Rule 1.9 . . . A lawyer who has formerly represented another person in the same or a substantially related matter in which that person's interests are materially adverse to the interests of the former client unless the former client gives informed consent, confirmed in writing . . ."
The plaintiff asserts that the rules do not provide for and therefore do not permit the application of a so-called "Chinese Wall."
The plaintiff also calls the court's attention to two separate prior decisions which she claims are applicable to this situation: Bergeron v. Mackler, 225 Conn. 391 (1993) and Goldenberg v. Corporate Air, Inc., 189 Conn. 504 (1983).
Also, the plaintiff calls attention to the relatively recent appearance of the Bai firm for the defendant in this case to argue that it would not be an inconvenience to the defendant or result in a delay of the proceedings if that firm was disqualified.
The defendant, on the other hand, while acknowledging the general purpose of disqualification of counsel, cites the court to two separate Superior Court cases which have applied the "Chinese Wall" to situations like the one at bar: North v. United of Omaha Life Insurance Co., 1999 WL 511165, 25 Conn. L. Rptr. 18 (Devlin, J.) and Milne v. Ryea, 2004 WL 423117, 36 Conn. L. Rptr. 420 (Beach, J.). The defendant claims that these cases support the proposition that where there exists no opportunity to compromise the plaintiff's interests no disqualification is required.
The defendant makes no claim that the Rules of Professional Conduct specifically authorize the creation of the "Chinese Wall."
The Law
"Disqualification of counsel is a remedy that serves to `enforce the lawyer's duty of absolute fidelity and to guard against the danger of inadvertent use of confidential information.'" Silver Chrysler Plymouth, Inc. v. Chrysler Motor Corporation, 518 F.2d 751, 754 (2d Cir. 1975). In disqualification matters, however, we must be `solicitous of a client's right freely to choose his counsel'; Government of India v. Cook Industries, Inc., 569 F.2d 737, 739 (2d Cir. 1978); mindful of the fact that a client whose attorney is disqualified may suffer the loss of time and money in finding new counsel and `may lose the benefit of its longtime counsel's specialized knowledge of its obligations.' Id. The competing interests at stake in the motion to disqualify, therefore, are (1) the [plaintiff's] interest in protecting confidential information; (2) the [defendant's] interest in freely selecting counsel of [her] choice; and (3) the public's interest in the scrupulous administration of justice. Goldenberg v. Corporate Air, Inc., 189 Conn. 504, 507, 457 A.2d 296 (1983), overruled in part, Burger Burger, Inc. v. Murren, 202 Conn. 660, 522 A.2d 812 (1987).
"Rule 1.9 of the Rules of Professional Conduct governs disqualification of counsel for a conflict of interest relating to a former client. The rule states that: `A lawyer who has formerly represented a client in a matter shall not thereafter: (a) Represent another person in the same or a substantially related matter in which that person's interests are materially adverse to the interests of the former client unless the former client consents after consultation; or (b) Use information relating to the representation to the disadvantage of the former client except as Rule 1.6 would permit with respect to the client or when the information has become generally known.'
"Rule 1.9 (a) expresses the same standard that we had applied under the Code of professional Responsibility when a claim of disqualification based on prior representation arose. Thus, an attorney should be disqualified if he has accepted employment adverse to the interests of a former client on a matter substantially related to the prior representation. State v. Jones, [180 Conn. 3443, 429 A.2d 936 (1980), overruled in part, State v. Powell, 186 Conn. 547, 442 A.2d 939 (1982), cert. denied sub nom. Moeller v. Connecticut, 459 U.S. 838, 103 S.Ct. 85, 74 L.Ed.2d 80 (1982)]. This test `has been honed in its practical application to grant disqualification only upon a showing that the relationship between the issues in the prior and present cases is patently clear" or when the issues are "identical" or "essentially the same." Government of India v. Cook Industries, Inc., [supra, 569 F.2d 739-40].' [ State v. Jones, supra, 449]; see also State v. Bunkley, 202 Conn. 629, 652, 522 A.2d 795 (1987)." Once a substantial relationship between the prior and the present representation is demonstrated, the receipt of confidential information that would potentially disadvantage a former client is presumed. Goldenberg v. Corporate Air, Inc., supra, [ 189 Conn. 512]; State v. Jones, supra, 450.
"Unlike Canon 9 under the Code of Professional Responsibility, however, the Rules of Professional Conduct do not expressly state that a lawyer should avoid the appearance of impropriety. Even when Canon 9 was applicable, we rejected the notion that an `appearance of impropriety' was alone sufficient ground for disqualifying an attorney. In State v. Jones, supra, [ 180 Conn. 452-53], we stated that `the appearance of impropriety alone is "simply too slender a reed on which to rest a disqualification order except in the rarest of cases." Board of Education of the City of New York v. Nyquist, 590 F.2d 1241, 1247 (2d Cir. 1979).' See also State v. Bunkley, supra, [ 202 Conn. 653-54]." American Heritage Agency, Inc. v. Gelinas, 62 Conn.App. 711 (2001).
"Although considering the appearance of impropriety may be part of the inherent power of the court to regulate the conduct of attorneys, it will not stand alone to disqualify an attorney . . ." Bergeron v. Mackler, 225 Conn. 391, 399 (1993).
A trial court has the authority to regulate the conduct of attorneys and a duty to enforce standards of conduct regarding attorneys. In that regard the trial court has broad discretion to determine whether there exists a conflict of interest that would warrant disqualification of an attorney. State v. Jones, 180 Conn. 443 (1980).
"Where . . . there is not indication of a betrayal of trust by the former counsel or any indication that his new employer has gained any advantage in the case, disqualification on appearance grounds alone is unnecessary . . ." Horch v. United of Omaha Life Insurance Co., supra.
When sufficient procedures are put in place in the form of a "Chinese Wall" to guarantee that there can be no accidental disclosure of a client's confidential information no disqualification is required when an attorney changes employment into an adversaries' law firm. Milne v. Ryea, supra. The concept of screening or a "Chinese Wall" has often been recognized in Connecticut courts. See, e.g. Temkin v. Temkin, 1993 WL 392941, 10 Conn. L. Rptr. 127; Beckenstein Enterprises et al. v. Dennis J. Smith, 2003, WL 1900915, 34 Conn. L. Rptr. 459.
Moreover, the concept has been discussed and applied over a long period of time, both with and without the benefit of rules. See The Chinese Wall Defense to Law-Firm Disqualification, 128 U.Pa.L.Rev. 677 (1980); 68 A.L.R. Fed. 687.
Conclusion
The associate has testified that there has been no disclosure of the plaintiff's confidential information to her present employer, the Bai firm, and her testimony is credited by the court. No evidence to the contrary has been offered or suggested. Moreover, the associate clearly understands her obligations in that regard. The Bai firm, also, has made it clear that it understands the associate's obligations in that regard and has not and will not put her in a position to violate that obligation.
The multitude of steps taken by the Bai firm to avoid the accidental disclosure of any of the plaintiff's confidential information, whatever they may be called, satisfies the court that there will be no accidental disclosure.
Whether the court credits the Plaintiff's argument that there is a presumption that confidential information of the plaintiffs will be disclosed, the court specifically finds that in this case any presumption that does exist has been rebutted by the evidence offered at the hearing with respect to the screening of the associate in her new firm.
The cases cited by the plaintiff, as above, while providing general guidance on the subject of conflict of interest and disqualification are not helpful to the plaintiff in these circumstances. The court is not convinced that the length of time the Bai firm has been in the case favors disqualification although it obviously should be one of the factors taken into account.
The associate is clearly disqualified from representing the defendant; but the court concludes that under the circumstances outlined above, as long as the screening restrictions are kept in place, the Bai firm is not disqualified en toto. The plaintiff's motion is denied.