Martin v. AtlantiCare, 2011 U.S. Dist. LEXIS 122987 (Oct. 25, 2011 D.N.J.). Read opinion here .
Although this overview is not highlighting a Delaware decision, because the issue addressed is an important one and the Court’s reasoning may be applicable generally in Delaware, we thought this case summary was noteworthy.
Whether a law firm that employs a disqualified “side-switching” attorney should be disqualified by imputation. “A side-switching attorney is one who formerly represented a client in a matter and subsequently undertakes representation or affiliates herself with a firm that has undertaken representation, of an adversary in a related matter.” (Citation omitted).
A former associate of Eckert Seamans prepared this summary.
The facts of this case focus on an attorney with almost 25 years of experience in litigating employment matters in New Jersey (“Attorney”). Attorney worked for the Morgan Lewis & Bockius firm from November through March of 2010, during which time she dedicated a significant number of hours to representing AtlantiCare – the defendant in a NJ Superior Court matter (that Attorney ultimately had transferred to Federal court). When Attorney left Morgan Lewis, she started working for Costello & Mains, the law firm that was representing the plaintiff in the AtlantiCare matter.
Morgan Lewis and Costello & Mains agreed that Attorney was disqualified from representing the plaintiffs pursuant to Rule of Professional Conduct 1.9; but Defendant AtlantiCare moved to disqualify Attorney’s new firm, Costello & Mains, as well.
The District Court spent a great deal of time discussing the facts presented in the parties’ papers, and explained that “[t]he decision whether to disqualify a law firm by imputation is best undertaken on a case-by-case basis, weighing the facts as they exist at the time the motion to disqualify is made.” Since the parties agreed that Attorney was disqualified under Rule 1.9, the Court turned to the issue at hand: whether the disqualification should be imputed to Attorney’s firm under Rule 1.10(c).
To make this determination the Court must assess the three elements of RPC 1.10(c). First, whether LG had primary responsibility for the case while she worked at Morgan [Lewis]. Second, whether [Attorney] was adequately screened upon joining CM. Third, whether timely notice was provided to defendants of LG’s side switching. The Court must conduct a “painstaking analysis of the facts” as to each of these elements.
At the outset, the Court found that Attorney had “primary responsibility” for the AtlantiCare case while she worked at Morgan Lewis, meaning she had “actual participation in the management and direction of the matter at the policy-making level or responsibility at the operational level as manifested by the continuous day-to-day responsibility for litigation or transaction decisions.” See RPC 1.0(h). AtlantiCare argued that Attorney was an integral member of the litigation defense team at Morgan Lewis; that she billed more than the other attorneys on the team combined; and that she was privy to confidential work product during her representation of AtlantiCare. Plaintiffs argued that Attorney’s role in AtlantiCare’s defense was “limited,” and that Attorney was not the “supervising attorney” or “partner in charge” of the matter.
After reviewing the arguments and Attorney’s billing records, the Court held that it was not necessary that Attorney be the “supervising attorney” or “partner in charge” to be the attorney with “primary responsibility” for the matter; it was necessary that Attorney “had a ‘direct,’ ‘substantial’ and ‘meaningful’ role in AtlantiCare’s defense.”
The Court ruminated on the significance of Attorney’s access to AtlantiCare’s privileged documents and communications, and determined that disqualification should not be imputed based solely on Attorney’s review of discovery materials; rather, the Court would consider all the facts surrounding Attorney’s representation of AtlantiCare. Additionally, the Court noted that since NJ requires a law firm’s screening procedures to be in writing. Costello & Mains did not have a written screening procedure, so even if the Court found that Attorney did not have “primary responsibility” for the matter, the disqualification still would have been imputed. Further, the procedures that Costello & Mains implemented were inadequate under NJ law, and the firm would have been disqualified by imputation even if Attorney did not have “primary responsibility” and the screening procedure was in writing.
Lastly, the District Court noted that Attorney’s departure from Costello & Mains did not cure the firm’s imputed disqualification.
Both Delaware’s and New Jersey’s Rules of Professional Conduct are based on the ABA’s Model Rules of Professional Conduct. Presumably, the analysis of an imputed disqualification in Delaware would be similar to the analysis in New Jersey: the Court would first consider whether the individual attorney was disqualified under Rule 1.9, and then consider whether the disqualification should be imputed to the firm under Rule 1.10. Disqualification of an attorney is serious business and is not taken lightly in Delaware courts or any other court.
Unlike New Jersey, Delaware does not require screening procedures to be in writing but strongly recommends it. See comments 9 and 10 to Del. Prof. Cond. R. 1.10. For articles on disqualification that cite to Delaware cases, see, e.g., here, here and here.