Opinion
No. CV-09-5029670
July 1, 2010
RULING ON MOTION TO DISQUALIFY
The plaintiff has moved to disqualify Joseph R. Sastre, Esq. and the law firm of William C. Rivera from representing the defendant, Jose Morales, in this matter due to a conflict of interest pursuant to Connecticut Rules of Professional Conduct, Sections 1.6, 1.9 and 1.10.
Factual and Procedural History
The plaintiff has alleged that Attorney Sastre was employed by Hunt Leibert Jacobson, PC ("Hunt Leibert") from January 27, 2009 through April 23, 2010. He was hired to attend foreclosure mediations and to handle the foreclosure Short Calendar on an occasional basis. During his employment at Hunt Leibert Attorney Sastre handled hundreds of mediations across the state on behalf of virtually every client of Hunt Leibert.
Attorney Sastre prepared and filed a Motion to Terminate the mediation stay in this case on behalf of the plaintiff on February 5, 2010. Thereafter, the Mediation Specialist's Request to Extend Mediation was granted and the mediation process resumed. At the mediation scheduled for May 17, 2010, Attorney Sastre, who had left the employ of Hunt Leibert, appeared on behalf of the defendant. The mediation did not proceed and, due to the conflict of interest alleged by the plaintiff, has not yet been rescheduled.
In the Motion to Disqualify, the plaintiff has sought to disqualify Attorney Sastre and the firm of Attorney Rivera in this case and "any other matter wherein a client of Hunt Leibert is a party." At the second hearing on this Motion, the plaintiff's counsel represented that it was limiting the motion to this case only. The court takes judicial notice that due to the alleged conflict, mediations involving all clients represented by Hunt Leibert and the firm of Attorney Rivera have not proceeded since the date Hunt Leibert first became aware of the conflict of interest, May 17, 2010.
Attorney Sastre and the law firm of William Rivera filed an objection to the Motion to Disqualify. No one has raised the issue of standing. See Crone v. Gill, 250 Conn. 476, 736 A.2d 131 (1999) (holding that the client, and not the attorney, has standing to object to a motion to disqualify).
A hearing on the present motion was scheduled for June 15, 2010 and was continued for two weeks until June 29, 2010 so that the parties could present evidence, if necessary. That hearing occurred and Attorney Rivera testified that prior to employing Attorney Sastre, he was a solo practitioner. His clients are primarily Spanish speaking. He further testified that 70% of his business is composed of foreclosure defense work and 70% of that business involves Hunt Leibert and its clients. Attorney Rivera is one of only a few Spanish speaking attorneys who do foreclosure work. Attorney Sastre does not speak Spanish. Attorney Rivera further testified that the defendant, Mr. Morales, had been his client for a long time and he (Attorney Rivera) believed that Mr. Morales would be upset if Attorney Rivera could not represent him in this case.
Attorney Rivera became acquainted with Attorney Sastre while Attorney Sastre worked for Hunt Leibert. He and Attorney Sastre had several conversations about the possibility of Attorney Sastre leaving Hunt Leibert and going to work for Attorney Rivera doing foreclosure mediation defense. The issue of conflict of interest never came up in those conversations. It was not until after Attorney Rivera hired Attorney Sastre that the issue of conflict of interest ever arose. Neither Attorney Rivera nor Attorney Sastre ever checked with Hunt Leibert or its clients to determine if the clients would waive any potential conflicts of interest which would arise when Attorney Sastre went to work for Attorney Rivera.
After Attorney Rivera hired Attorney Sastre they agreed that Attorney Sastre would not work on any cases in which Hunt Leibert represented the plaintiff unless those cases were commenced after Attorney Sastre had left the employ of Hunt Leibert. However, there were no measures taken by Attorney Rivera to ensure that Attorney Sastre's work was so limited. It was only after the conflict arose in the present case that Attorney Rivera took any measures to avoid future conflicts of interest: he had his staff go through all of the files and segregate them in a place where Attorney Sastre did not have access to them.
At the hearing Attorney Sastre also testified that he did nothing to check with Hunt Leibert or its clients about potential conflicts of interest before leaving Hunt Leibert. He further testified that Hunt Leibert did not ask him to relinquish any confidential information upon his leaving the firm.
The plaintiff filed a Supplemental Affidavit in Support of Motion to Disqualify. The Affidavit was authored by Valerie Finney, a senior associate attorney with the mediation team at Hunt Leibert. She averred that her duties at Hunt Leibert included training of new attorneys hired to do mediations. Attorney Finney trained Attorney Sastre. The training included imparting various types of confidential information, including passwords to all client specific websites, complete contact lists, phone numbers and e-mail addresses of clients' employees not available to the public, policy and policy updates and strategic tips for mediation.
Discussion of the Law and Ruling
In their brief and at the hearing, Attorneys Rivera and Sastre relied heavily on the case of Klein v. Bristol Hospital, 50 Conn.Sup. 160, 915 A.2d 942 (2006). In that case some of the defendants sought to disqualify the plaintiff's law firm because one of its partners, Attorney Edwards, had worked for the law firm who represented one of the defendants. Attorney Edwards had done no work on the case and had no knowledge of the case. The opinion of the court in Klein stressed the difference between a situation like the present one where the representation involves the same case and one where the attorney with the alleged conflict has no knowledge of and had never worked on the same case:
Because the defendants seek to disqualify the Stratton firm, the principal ethical provision implicated is rule 1.10(b) of the Rules of Professional Conduct which provides: When a lawyer becomes associated with a firm, the firm may not knowingly represent a person in the same or a substantially related matter in which that lawyer, or a firm with which the lawyer was associated, had previously represented a client whose interests are materially adverse to that person and about whom the lawyer had acquired information protected by Rules 1.6 and 1.9(2) that is material to the matter.
It is clear from rule 1.10(b) that not all representation adverse to a migrating lawyer's former clients is forbidden to his new firm. Rather, the lawyer's new firm may not represent a client in the same or a substantially related matter in which its new lawyer, or a firm with which he was previously associated, had represented a person whose interests are materially adverse to the new firm's client, and in which the new lawyer had acquired confidential information about his former client which is material to the new matter.
The Connecticut Supreme Court has succinctly stated the rationale for requiring disqualification in certain cases involving a lawyer's former clients and established a balancing test for the court to apply in considering such a motion: "Disqualification of counsel is a remedy that serves to enforce the lawyer's duty of absolute fidelity and to guard against the danger of inadvertent use of confidential information . . . In disqualification matters, however, we must be solicitous of a client's right freely to choose his counsel . . . mindful of the fact that a client whose attorney is disqualified may suffer the loss of time and money in finding new counsel and may lose the benefit of its longtime counsel's specialized knowledge of its operations . . . The competing interests at stake in the motion to disqualify, therefore, are: (1) the defendant's interest in protecting confidential information; (2) the plaintiffs' interest in freely selecting counsel of their choice; and (3) the public's interest in the scrupulous administration of justice." (Citations omitted; internal quotation marks omitted.) Bergeron v. Mackler, 225 Conn. 391, 397-98, 623 A.2d 489 (1993).
In so doing the court has allied itself with the majority view of the core interest at stake in rules 1.9 and 1.10, the protection of confidential information gained from a former client by the attorney and at risk of disclosure in his subsequent adverse representation. See 1 G. Hazard W. Hodes, The Law of Lawyering (3d Ed. 2001 2005-1 Sup.) § 13.5, p. 13-13.
Sometimes the risk of disclosure of confidential information is clear, as when the new firm seeks to represent a client with interests adverse to its new lawyer's former client in the same legal dispute. Also, when "the relationship between the issues in the prior and present cases is patently clear or when the issues are identical or essentially the same"; (internal quotation marks omitted); Bergeron v. Mackler, supra, 225 Conn. 399; the cases will be found to be "substantially related," and " the receipt of confidential information that would potentially disadvantage a former client is presumed." Id.Klein v. Bristol Hospital, 50 Conn.Sup. at 163-67. Emphasis added.
Attorneys Rivera and Sastre also point out that motions to disqualify a firm whose attorney has represented an adverse client in the same matter have been denied where the firm has taken steps to insure that the conflicted attorney is not involved at all in the action, sometimes referred to as erecting a "Chinese Wall." Horch v. United of Omaha Life Insurance, 1999 Ct.Sup. 8776, 25 CLR 18 (Devlin, J., Jul. 2, 1999). The decision in Horch explains:
In his affidavit, Attorney O'Shea details the "Chinese Wall" efforts to exclude him from the case. Such efforts include: 1) refraining from communications regarding any aspect of the case; 2) a total lack of access to the file; and 3) not being in the vicinity of attorneys or staff while they have been working on the case. In addition, Attorney Millman's affidavit confirms the prophylactic measures used to exclude Attorney O'Shea from any contact with this case, and also states that, in a further effort to avoid the appearance of a conflict of interest, the law firm of RisCassi and Davis was brought in to file an appearance in addition to Attorney Millman. Based on the above measures, Horch claims that disqualification is inappropriate.Horch, supra, at 8777.
Rule 1.9 of the Rules of Professional Conduct provides:
(a) A lawyer who has formerly represented a client in a matter shall not thereafter represent another person in the same or a substantially related matter in which that person's interests are materially adverse to the interests of the former client unless the former client gives informed consent, confirmed in writing.
Attorney Sastre filed a pleading in the present matter on behalf of the plaintiff. Therefore, Rule 1.9 clearly bars his representation of the defendant in this same matter. Rule 1.10 bars Attorney Rivera from representing the defendant in this case. The only exception to that bar arises when the firm of the attorney who has previously represented the adverse party on the same matter takes specific steps to ensure that such attorney has no contact whatsoever with such matter.
Attorney Rivera's failure to take any steps to insulate Attorney Sastre from contact with this file was evidenced by the fact that he sent Attorney Sastre to a mediation on behalf of the defendant in this case. Attorney Rivera has admitted and the court accepts that such actions were inadvertant. However, the fact that they occurred at all clearly demonstrates that there was no Chinese Wall in existence at the time the conflict arose. Thus, this case is quite different from Horch, in which the law firm took many measures to insulate the conflicted attorney before the alleged conflict arose.
Attorney Rivera has set up measures to ensure that Attorney Sastre will have no contact with this case in the future. Moreover, there may well be a hardship to the defendant if Attorney Rivera can no longer represent him in this case. However, Attorney Rivera easily could have avoided the hardship. Since approximately 50% of his cases involve Hunt Leibert, it is rather unbelievable to the court that he took no advance measures whatsoever to deal with the issue of conflict(s) of interest which was almost certain to arise after he hired Attorney Sastre.
In this case where Attorney Sastre has represented the plaintiff and is employed by a firm that now represents the defendant in the same action, "the receipt of confidential information that would potentially disadvantage [the plaintiff] is presumed." Bergeron v. Mackler, supra at 399. Allowing Attorney Rivera to continue to represent the defendant here would require the court to ignore the clear requirements of Rules 1.9 and 1.10. The purpose of those rules is to enforce the lawyer's duty of absolute fidelity and to guard against the danger of inadvertent use of confidential information.
Based on the foregoing, the Motion to Disqualify Attorney Sastre and the law offices of William C. Rivera from representing the defendant in this case is granted.