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plaintiffdefendantattorneylawyermotionmalpracticeoverruled

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Warpar Mfg. Corp. v. Ashland Oil, Inc., 606 F.Supp. 852

Facts

The case arose from a protracted litigation involving the plaintiffs, Randustrial Corporation and Warpar Manufacturing Company, against Ashland Oil Inc. and Ashland Petroleum Company. The plaintiffs contended that GSFN's defense of their former attorney, Einbund, in a malpractice action required GSFN's disqualification due to potential conflicts of interest. The plaintiffs argued that GSFN had access to privileged information that could affect the current case. However, the court found that the plaintiffs did not provide sufficient evidence of any actual taint from GSFN's representation of Einbund.

The salient facts are not in dispute. On November 21, 1978, the initial complaint in this action was filed on behalf of the plaintiff Warpar Manufacturing Company (hereinafter Warpar), against the defendant by Warpar's initial counsel, Mr. Lewis Einbund (hereinafter Einbund) of the law firm of Sindell, Selker and Rubenstein of Cleveland, Ohio.

Issue

Whether the defense counsel, GSFN, should be disqualified from representing Ashland due to its prior representation of the plaintiffs' former attorney in a malpractice action.

Whether the defense counsel, GSFN, should be disqualified from representing Ashland due to its prior representation of the plaintiffs' former attorney in a malpractice action.

Rule

The court applied the principles of the Code of Professional Responsibility, particularly focusing on the concepts of irrebuttable and rebuttable presumptions of taint regarding conflicts of interest.

In addressing the nature of the presumption to be applied, the Court observes that in this case the normal internal office procedures that are designed to identify potential conflicts would have been unproductive in this factual setting.

Analysis

The court analyzed the unique factual circumstances of the case, determining that the presumption of taint should be rebuttable rather than irrebuttable. The court noted that the plaintiffs had not provided evidence of any actual communication or access to privileged information between GSFN and Einbund that would warrant disqualification. The affidavits submitted by GSFN indicated that there had been no contact or exchange of confidential information relevant to the current litigation.

The court focused on the disciplinary rules in connection with Canon 4 and in particular Rule DR4–101(C)(4) which states: (C) a lawyer may reveal: … (4) conferences or secrets necessary to establish or collect his fee or to defend himself or his employees or associates against an accusation of wrongful conduct.

Conclusion

The court overruled the motion to disqualify GSFN, concluding that the plaintiffs had not demonstrated any actual conflict of interest or taint that would necessitate disqualification.

For the foregoing reasons, the motion to disqualify GSFN is overruled.

Who won?

Gallagher, Sharp, Fulton and Norman (GSFN) prevailed in the case as the court denied the motion to disqualify them, finding no evidence of taint or conflict of interest.

The burden of the District Court's order did not fall most harshly on Goldberg; rather its greatest impact has been felt by Bernson, Hoeniger, Freitag & Abbey, plaintiffs' counsel, which was disqualified from participation in the case.

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