Wednesday, May 7, 2014

Two Conflicts Updates: Paralegal Screening + Conflicts Waivers in the News

Via the SCOG Blog: "Supreme Court of Georgia on Paralegal Conflicts" --
  • S13G1626. HODGE, ADMRX., et al. v. URFA-SEXTON, LP et al. This case considers the question of whether a paralegal who has knowledge of a case can disqualify an entire law firm from representing a party…
  • "Kristi Bussey was a paralegal at Hanks Brookes and participated in the investigation into potential claims, as well as assisting Hodge in being appointed the administrator of the estate. URFA-Sexton retained Insley & Race LLC in March 2010 to represent it in connection with the potential case threatened by Hodge. A year later (but before the suit was filed), Bussey interviewed for a paralegal position at Insley & Race and was hired. Bussey said she did not become aware of the potential conflict until just before Hodge filed this case in November 2011."
  • "After informing her superiors, Insley & Race implemented screening measures and Bussey provided affidavits that she never disclosed or discussed any confidential information regarding the Williams case with anyone at Insley & Race."
  • "On May 5, 2014, the Supreme Court unanimously vacated and remanded (Nahmias, concurring specially). Writing for the Court, Justice Hunstein explained that the Supreme Court adopted the majority rule in interpreting the Rules of Professional Conduct: a nonlawyer’s conflict of interest does not automatically disqualify an entire law firm, so long as proper screening measures are implemented."
  • The Court also set forth specific guidance for dealing with a nonlawyer’s conflict of interest, including providing prompt notice to opposing counsel of the conflict along with an explanation of the screening measures utilized. The receiving party may then move to disqualify the firm with the potential conflict. If the party receiving notice can show the nonlawyer worked on the same (or a substantially related) matter, then a rebuttable presumption arises that confidential information was shared with their new firm."
  • "That firm can rebut the presumption and avoid disqualification by showing effective screening measures.In this case, the screening measures were effective and appropriate, but there remains an issue of whether the new law firm promptly disclosed the conflict, requiring an additional hearing."
Via the Legal Ethical Forum: "A conflict and a waiver claim in the Dewey Four case" --
  • "The WSJ Law Blog reports that a witness against some or all of the Dewey Four will be former Dewey partner, now at DLA, John Altorelli. However,  the  firm that represents him also represents Zachary Warren, whose indictment  has observers puzzled.  Writes the WSJ Blog:
  • "On Monday Peirce Moser, a prosecutor in Manhattan District Attorney Cyrus Vance Jr.’s office, told the judge overseeing the criminal case that Mr. Altorelli was a witness for the prosecution. The issue came up because Mr. Altorelli is represented by the same law firm, Zuckerman Spaeder LLP, that is defending a fourth person in the criminal case—a young lawyer named Zachary Warren who was previously a client manager at Dewey & LeBoeuf. Mr. Warren has pleaded not guilty."
  • "Paul Shechtman, a lawyer for Mr. Warren, said both his client and Mr. Altorelli had signed conflict waivers with the firm."
Legal Ethics Blog author and NYU professor of Law Stephen Gillers commented:"In federal court there would now be a Cuccio hearing and I assume there'll be the equivalent in state court. A conflict waiver may work. Or not. We don't know on what Zuckerman represents Altorelli. Nor do we know if his testimony will target Warren or only the other Dewey defendants.The risk to the trial, of course, is that despite a waiver a defendant can claim ineffective assistance because of the conflict.
Worth watching. Not all conflicts can be waived."

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