Tuesday, October 11, 2016

Conflicts: Playbooks, Clerks, Screens & Clients (Current and Former)

Several conflicts updates to share, starting with two recent decisions noted by Bill Freivogel.

  • 473440 Alberta Ltd. v. Lenaco Homes Masterbuilder Inc., 2016 ABQB 435 (CanLII)(Ct. Q.B. Alberta Aug. 31, 2016).
  • This is a food fight among companies and individuals in the building business. Lawyer represents Defendants. Lawyer had previously done work for Plaintiffs on two other matters. Plaintiffs moved to disqualify Lawyer in this case. In this opinion the court disqualified Lawyer.
  • The evidence was conflicting, but, on balance, the court believed that Lawyer would have learned things about Plaintiffs in the earlier matter that would have been relevant to the tasks in this matter. In our view, this was essentially an application of the 'playbook' rule, as it is known in the U.S.
Screening an active client conflict:
  • Fabick, Inc. v. FABCO Equip., Inc., 2016 WL 5718252 (W.D. Wis. Sept. 30, 2016).
  • Lawyer at Law Firm had done some trademark work for Plaintiff. Lawyer remains “attorney of record” for the trademarks he had obtained. Lawyer also retained responsibility for maintaining the trademarks. In this trademark infringement case, Law Firm appeared for Defendant. Plaintiff moved to disqualify Law Firm.
  • Among other things, the court found that Lawyer’s continuing duty to maintain the trademarks makes Plaintiff a current client subject to Rule 1.7. Although screens are specifically provided for in former client situations only, the court allowed Law Firm to continue in this case provided it erect a screen between Lawyer and the lawyers working on this case.
And Karen Rubin at Thomson Hine notes: "Hiring student law clerks and avoiding disqualification — two states weigh in" --
  • "When a law clerk or a law school graduate you hire has clerked for a firm representing a party adverse to your client, what happens?  Is the student or newly-minted lawyer disqualified from working on your matter? Is your whole firm disqualified?  Can you screen the clerk/former clerk and solve the problem?  Two recent ethics opinions out of Texas and Ohio clarify the rules."
  • "The new Texas ethics opinion applied the new comment and ruled that when a firm hires a new associate who worked as a clerk for the firm representing the opposing party, the former clerk is disqualified from working on the case at the new firm, but that the new firm can screen the clerk and avoid imputation of the clerk’s conflict.  That sensible approach is good news for Texas firms and law clerks, and the comment is broadly aimed at other incoming non-lawyer employees, such as secretaries, too...Ohio’s Board of Professional Conduct issued similar advice earlier this summer."

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