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Casey IRACs are produced by an AI that analyzes the opinion’s content to construct its analysis. While we strive for accuracy, the output may not be flawless. For a complete and precise understanding, please refer to the linked opinions above.

Keywords

appealmotionintellectual propertytrademark
plaintiffdefendantlitigationmotionintellectual property

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Macy’s Inc. v. J.C. Penny Corp., Inc., 107 A.D.3d 616, 968 N.Y.S.2d 64, 2013 N.Y. Slip Op. 04891

Facts

The case arose when a retailer brought an action against a second retailer, leading the second retailer to file a motion to disqualify the first retailer's counsel, Jones Day. The motion was based on alleged conflicts of interest due to Jones Day's prior representation of the second retailer in unrelated intellectual property matters. The Supreme Court denied the motion, leading to an appeal by the second retailer.

By agreement dated March 7, 2008 Jones Day undertook to represent defendant regarding certain “intellectual property litigation and trade mark registration” in Asia. That agreement expressly informed defendant about the possibility that Jones Day's present or future clients “may be direct competitors of [defendant] or otherwise may have business interests that are contrary to [defendant]'s interests.”

Issue

Did the Supreme Court abuse its discretion in denying the second retailer's motion to disqualify the first retailer's counsel?

Did the Supreme Court abuse its discretion in denying the second retailer's motion to disqualify the first retailer's counsel?

Rule

The court applied the principle that a party may waive conflicts of interest if they are adequately informed and continue to engage the counsel in question.

Supreme Court providently exercised its discretion in denying defendant's motion to disqualify Jones Day from representing plaintiffs in this action because Jones Day informed defendant about potential conflicts, and defendant waived its right to protest thereto.

Analysis

The court determined that the second retailer had waived any potential conflict of interest by continuing to engage Jones Day after being informed of the possible conflicts. The agreement between Jones Day and the second retailer explicitly stated the potential for conflicts and required the second retailer's acceptance of those terms. The court found that the interests represented by Jones Day in the Asian trademark matters did not conflict with the interests at issue in the current case.

The court determined that the second retailer had waived any potential conflict of interest by continuing to engage Jones Day after being informed of the possible conflicts.

Conclusion

The court concluded that the Supreme Court did not abuse its discretion in denying the motion to disqualify counsel, affirming the lower court's decision.

The court concluded that the Supreme Court did not abuse its discretion in denying the motion to disqualify counsel, affirming the lower court's decision.

Who won?

The first retailer prevailed in the case because the court found that the second retailer had waived any conflict of interest and that the interests at stake were unrelated.

The first retailer prevailed in the case because the court found that the second retailer had waived any conflict of interest and that the interests at stake were unrelated.

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