Opinion
90 Civ. 2370 (JFK)(FM)
May 13, 2002
MEMORANDUM DECISION AND ORDER
I. Introduction
On February 7, 2002, during a telephone status conference, counsel for the Defendant ("Baker McKenzie") alerted this Court to a potential conflict of interest on the part of counsel for the Plaintiff ("Riker, Danzig") arising out of Riker, Danzig's prior representation of the Defendant's parent company, Grupo Financiero Interacciones, S.A. ("GFI"), in connection with a potential securities litigation between GFI and Salomon Brothers. That dispute (the "GFI/Salomon dispute") was settled on February 17, 1995. (See Decl. of Arturo Martinez de la Mora, dated Feb. 22, 2002, Ex. 3 (letter from Lee H. Kimmell to John Sandleman, dated Feb. 17, 1995)). I directed Baker McKenzie to file a formal motion on behalf of the Defendant to disqualify Riker, Danzig and stayed further discovery pending a decision on that motion. (See Docket No. 205).
On or about February 22, 2002, the Defendant filed its motion to disqualify Riker, Danzig; opposition papers were due on March 8, 2002. (See Docket Nos. 206, 207). On March 1, 2002, however, upon the request of counsel for both sides, I adjourned the date for the Plaintiff's opposition papers and the Defendant's reply to March 29 and April 26, 2002, respectively. (See Docket No. 208). The Plaintiff served and filed its opposition papers on time. (See Docket Nos. 210-216). Thereafter, on April 22, 2002, I approved Baker McKenzie's request, to which Riker, Danzig had acceded, to extend the due date of the reply to May 9, 2002. (See Docket No. 218).
On May 3, 2002, the Defendant served and filed a motion to extend the date by which its reply was due from May 9 to May 31, 2002, contending that documents recently provided by Riker, Danzig regarding its representation of GFI indicated that the relationship between Riker, Danzig and GFI "was more extensive than previously believed." (Def.'s Mem. in Supp. of Mot. for Extension of Time at 3). The Defendant further sought leave to depose Alan E. Kraus, Lewis Clayton, and Anne M. Patterson, Esqs. — the attorneys who were involved in Riker, Danzig's representation of GFI in connection with the GFI/Salomon dispute. The Plaintiff opposed the motion to extend the date for the reply, and has cross-moved to quash the depositions sought by Baker McKenzie. For the reasons set forth below, the Defendant's motion to extend the date for its reply is granted, and the Plaintiff's motion to quash the depositions of Messrs. Kraus and Clayton, and Ms. Patterson is denied.
II. Discussion
The amount of discovery permitted with respect to a motion to disqualify counsel is left to the broad discretion of the judge before whom the motion is pending. Lefrak v. Arabian Am. Oil Co., 527 F.2d 1136, 1140 (2d Cir. 1975); European Cmty. v. RJR Nabisco, Inc., 134 F. Supp.2d 297, 309 (E.D.N.Y. 2001). "The trial judge may be able to make [a] determination [regarding a conflict of interest charge] . . . on the basis of oral arguments and affidavits, he may appoint a special master to ascertain the facts, or he may conduct [an] evidentiary hearing." European Cmty., 527 F.2d at 1140.
The Defendant contends that "substantial cause" for an extension of the reply date exists because the documents provided by Riker, Danzig "indicate that the nature of the relationship between Riker, Danzig and [GFI] was more extensive than previously believed and counsel for the [D]efendant have concluded that depositions of certain individuals are necessary." (Def.'s Mem. in Supp. of Mot. for Extension of Time at 3). The documents relied upon by the Defendant include: (a) a letter dated March 20, 1995 from Mr. Kraus, then a partner at Riker, Danzig, to Lee H. Kimmell, then a GFI executive, requesting facts regarding a second potential litigation involving Salomon Brothers, (letter from Baker McKenzie to the Court, dated May 8, 2002, Ex. 1 (letter from Alan E. Kraus, Esq. to Lee H. Kimmell, dated Mar. 20, 1995, at 1)); and (b) an internal memorandum, dated March 31, 1995, in which the results of the February 17th settlement and GFI's "situation as of March of 1995" are discussed. (letter from Baker McKenzie to the Court, dated May 8, 2002, at 1). Because both documents post-date the settlement of the GFI/Salomon dispute, the Defendant claims that they contradict the Kraus and Kimmell Declarations, which were submitted in opposition to the motion to disqualify.
In his Declaration, Mr. Kraus indicates that GFI and Salomon Brothers reached an oral agreement on or about February 15, 1995, regarding settlement of the GFI/Salomon dispute. (Decl. of Alan E. Kraus, Esq., dated March 28, 2002, ¶ 19). He also states that between February 15, 1995 and March, 1995, "the parties negotiated and drafted the documents memorializing and executing the terms of the settlement of the dispute regarding the securities transactions." (Id. ¶ 20). Mr. Kimmell agrees with Mr. Kraus's recollection. (See Decl. of Lee H. Kimmell, dated Mar. ___, 2002, ¶¶ 21, 22).
Neither Mr. Kraus nor Mr. Kimmell indicate, however, that GFI contemplated further litigation involving Salomon while the parties were finalizing the agreement settling the GFI/Salomon dispute or subsequent thereto. It also is unclear whether the information requested by Mr. Kraus in the March 20, 1995 letter was ever provided to Riker, Danzig.
Since information about a second potential litigation would shed light on the full extent of Riker, Danzig's representation of GFI and the information that the firm may have acquired in the process of that representation, I conclude that the Defendant should be permitted to depose Messrs. Kraus and Clayton, and Ms. Patterson. Such depositions, however, shall be limited to a maximum of one hour each, during which the Defendant may explore the nature and extent of Riker, Danzig's representation of GFI.
III. Conclusion
The due date for Defendant's reply papers is extended to May 31, 2002.
Additionally, the Defendant shall be permitted to depose Messrs. Kraus and Clayton, and Ms. Patterson with respect to the nature and extent of Riker, Danzig's representation of GFI. Consequently, Riker, Danzig's motion to quash the depositions is denied.
SO ORDERED.