Bressler Risk Blog

“Musk wins fight to keep lawyer Alex Spiro in Twitter trial” —

• “Elon Musk has persuaded a judge that his longtime [Quinn Emanuel] lawyer Alex Spiro can represent him in a shareholder lawsuit over the billionaire’s 2022 Twitter acquisition even though he may be a trial witness in the case.”
• “San Francisco-based U.S. District Judge Charles Breyer in a ruling on Monday rejected the plaintiffs’ objections that allowing Spiro to act as both advocate and witness would confuse jurors. The shareholders had argued that Spiro was ‘at the epicenter of virtually every important decision’ during Musk’s pursuit of Twitter and later efforts to walk away from the deal.”
• “Musk’s interest in keeping his chosen counsel, Breyer said, weighed against disqualification.”
• “The lawsuit claims Musk used misleading social media posts to drive down Twitter’s stock price to escape his $44 billion deal or negotiate a lower price for the platform, now renamed X. Musk has denied any wrongdoing.”
• “Musk’s lawyers called the effort to disqualify Spiro a ‘Hail Mary’ before a February 2026 trial, saying the investors waited too long to object to Spiro’s role. Musk on Tuesday asked the court to push the trial back until March. His lawyers said Musk ‘has a highly confidential and personal pre-existing and immovable commitment’ in late February that will not allow him to attend the trial and testify. The filing said the undisclosed matter was ‘sensitive’ and can’t be disclosed publicly.”
• “The judge said Musk gave written consent for Spiro to serve as both attorney and witness and concluded that the plaintiffs failed to show how his dual role would harm them.”
• “Breyer called concerns about jury confusion ‘generic’ and said courts can manage risks with instructions and limits on questioning. He noted that other witnesses could cover most of the topics plaintiffs identified and questioned whether Spiro’s testimony was ‘genuinely needed.'”
• “Spiro, with hourly rates of at least $3,000, has represented Musk in many cases and counts actor Alec Baldwin and New York Mayor Eric Adams among his other clients.”

“Google Challenges Motion to Disqualify Judge Over Friendship in Ongoing Antitrust Litigation” —

• “Google is contesting Unlockd Media’s motion to disqualify U.S. District Judge Haywood S. Gilliam Jr. from presiding over an antitrust lawsuit in the Northern District of California. Unlockd’s request is based on Judge Gilliam’s friendship with Cassandra Knight, Google’s Vice President for Litigation and Discovery.”
• “Google argues that this relationship does not necessitate recusal, emphasizing that Knight has not participated in the case and that mere friendship between a judge and a lawyer does not require disqualification.”
• “Unlockd filed its lawsuit in September 2021, alleging that Google’s actions, including banning the company from its app store and AdMob, led to its demise. Judge Gilliam dismissed Unlockd’s case in February 2025, deeming it based on ‘unsupported conclusions.'”
• “In a related matter, Rumble, a video-sharing platform, has also sought Judge Gilliam’s recusal in its antitrust case against Google, citing the same relationship with Knight. Google has opposed this motion as well, maintaining that the friendship does not warrant disqualification.”

“‘Our Colleague Has Been Vindicated’: Court Won’t Remove Lawyer From Case” —

• “The Texas First Court of Appeals rejected an attempt to disqualify Ahmad, Zavitsanos & Mensing from representing Transocean and other defendants in consolidated Hurricane Zeta litigation, finding that plaintiffs failed to establish a disqualifying conflict of interest.”
• “The two-page opinion allows Houston-based AZA to continue defending Transocean Offshore Deepwater Drilling Inc., Triton Voyager Asset Leasing GmbH, and Triton Voyager Asset Leasing GmbH in litigation involving crew member injuries aboard the Deepwater Asgard drilling rig during the October 2020 storm.”
• “The 23 plaintiffs claimed AZA attorney Karina Sanchez-Perlata created a conflict of interest because she previously worked on a case involving Dr. Henry Small, one of the treating physicians in the litigation. She previously worked as a law clerk at Arnold Itkin, the firm representing plaintiffs. The plaintiffs claimed Sanchez-Perlata had access to confidential information about Dr. Small after she joined AZA, and that she could use it against them.”
• “But the appellate court didn’t agree. ‘Any pending motions are dismissed as moot. We lift the stay of trial court proceedings,’ according to the opinion by the three-judge panel, which consisted of Justices Amparo ‘Amy’ Guerra, Kristin Guiney and Andrew Johnson.”
• “The opinion affirmed the trial court’s ruling from December 2024, in which it denied the motion to remove AZA because the Judge wrote, ‘Plaintiffs had failed to show a ‘substantial relationship’ between the prior representation and this litigation, as well as prejudice.'”
• ‘Today’s ruling not only speaks to the merits of the underlying allegations but also to the strategy deployed to attack a former summer associate,’ said Shahmeer Halepota, co-lead attorney on the case with AZA Law. ‘We are thrilled that our colleague has been vindicated.'”

“OLPR seeks discipline of lawyer in conflict-of-interest case” —

• “The Minnesota Office of Lawyers Professional Responsibility has announced it is seeking discipline of attorney John Richards III for providing representation for both a man accused of felony criminal sexual conduct and the mother of the alleged victim.”
• “Richards was retained to defend A.T. on felony charges of alleged criminal sexual conduct. The alleged victim was A.T.’s minor stepdaughter, K.L., who alleged that A.T. abused her repeatedly in their home.”
• “Richards also gave legal advice to J.T., mother of K.L. and A.T.’s wife, about K.L. Specifically, he provided guidance about the girl’s participation in interviews about the alleged abuse.”
• “The OLPR petition states that ‘the interests of the alleged perpetrator and the alleged victim were directly adverse.’ This became clearer as the matter unfolded. Richards also did not ask for or obtain informed consent regarding this conflict.”
• “J.T. was contacted by law enforcement regarding the investigation in her daughter’s allegations. She contacted Richards, who told her not to speak to anyone about her husband’s alleged conduct or allow her daughter to speak about it without Richards’ approval.”
• “The daughter was scheduled for a forensic protocol interview. Richards told the mother to not allow her daughter to talk to anyone unless the person wanting to schedule the interview contacted Richards first.”
• “The mother subsequently refused to allow her daughter to attend the interview. She informed law enforcement and social services that Richards was the ‘family attorney.’ Police informed the mother that Richards could not represent her daughter due to a conflict of interest. Ultimately, J.T. agreed to the interview.”
• “‘While the forensic protocol interview could further K.L.’s (and therefore J.T.’s as her caregiver) interest in obtaining support services, the interview could also lead to the disclosure of facts damaging to the step-father’s interest in defending against K.L.’s allegations,’ the petition asserts.”
• “Richards is accused of violating Rules 1.7(a)(1), 1.7(a)(2), 1.5(b)(1), 1.15(c)(5), 3.3(a)(1), 3.4(d), 4.4(a), 8.4(c), and 8.4(d). “

David Kluft writes: “Can multiple prospective clients bring a class action against ambulance chasers for illegal solicitation?” —

• “After a minor car accident, a TX woman received an unsolicited phone call from a “case runner” who claimed he got her contact information from her insurer, and who offered her $10K to ‘sign up’ for legal representation with a particular law firm.”
• “The woman later alleged that this call violated the Texas barratry law and Texas ethics Rule 7.03 (prohibition on solicitation). She filed a putative class action against the firm on behalf of ‘all Texas citizens whose vehicles were involved in motor vehicle crashes and were subsequently contacted by [the firm]’ during a certain date range.”
• “However, the Court dismissed the case due to ‘no ascertainable class.’ This was because determining whether any particular communication was a prohibited ‘solicitation’ would require individualized inquiry into whether the communication qualified as a solicitation under 7.03 ( e.g., was it ‘substantially motivated pecuniary gain,’ did the prospective client reach out first, etc.); whether one of the exemptions to Rule 7.03 applied (e.g., was the prospective client a lawyer, a family member or close friend, or an ‘experienced user’ of legal services); and whether the case runner was acting as the firm’s agent.”
• Decision: here.

David Kluft asks: “Can I mediate a dispute about ownership of a company and then appear as counsel in a related dispute about the same company?” —

• “A TX lawyer mediated a dispute between a sister and brother over part ownership of an investment company. Later, an Investor sued the sister in a separate litigation, claiming that the terms of the settlement with the brother in the first litigation constituted a misuse of company assets.”
• “The mediator’s law firm appeared in the second case for the Investor, and the sister moved to disqualify the mediator under Rule 1.12 (neutral can’t represent party in same matter).”
• “Apparently, the mediator’s firm ran a conflict check before taking the case, but the sister had gotten married and changed her name in the interim, so they didn’t notice the conflict.”
• “The mediator’s firm argued they should not be disqualified anyway because it was not the same ‘matter’ (i.e., it was a different litigation), but the TX Court of Appeals disagreed, holding that what qualifies as a ‘matter’ under the rule depends on the facts and circumstances, and here it was the same matter because it involves the same company and even some of the same payments.”
• “The Court also found that the firm’s screening was inadequate, so the whole firm was disqualified. However, another firm that that had already appeared as co-counsel for the Investor alongside the mediator’s firm was not disqualified by imputation absent specific evidence it received information from the mediator.”
• Decision: here.

“Bradley Arant Facing Convicted CEO’s Malpractice Claims, Bid for Removal From Case” —

• “Bradley Arant Boult Cummings is facing charges of legal malpractice in Alabama from a disgraced former health care CEO who alleges the firm dually represented him and his former company while it worked to oust him and then ‘concealed the conflict for more than two decades.'”
• “Richard Scrushy, founder and former CEO of HealthSouth—a company now called Encompass Health—also wants Bradley removed as his counsel in a separate civil case dating from the early 2000s because of the alleged conflict. The move could lead to overturning a $3.2 billion verdict against him.”
• “Scrushy’s attorney, Johnathan Austin of Austin Law in Birmingham said in an interview Bradley was not involved in mere ‘concurrent representation’ of both parties. ‘This was Bradley Arant representing Richard Scrushy and then going and representing HealthSouth directly adverse to Richard Scrushy,’ Austin said.”
• “The malpractice case followed Scrushy’s filing of new motions in a civil case dating from the early 2000s in which Scrushy was found liable for $3.2 billion in damages related to a high-profile accounting fraud and bribery scheme that led to his ouster from his job and ultimate prison time.”
• “Scrushy wants Bradley removed as his attorney in the civil case, titled Wade Tucker v. Richard M. Scrushy, because he did not know the firm was representing him and HealthSouth until he discovered documents earlier this year that a now-deceased company official had in his possession, Austin said.”
• “Austin said Scrushy believes the firm knew about the conflict even as the firm was representing both him and HealthSouth while the company was accusing him of fraud, filing false corporate reports and making false statements in court.”
• “In 2003, Scrushy was accused of filing false corporate reports and making false statements in Alabama state court related to a multi-billion-dollar accounting fraud scheme at HealthSouth—which included an FBI raid of his office.”
• “He was later acquitted of fraud but then was charged in federal court with money laundering, extortion, racketeering, bribery and obstruction of justice related to charges he bribed then-Gov. Don Siegelman. Scrushy was found guilty of bribery and conspiracy to commit wire fraud in 2007, sentenced to prison, and released in 2012.”
• “However, while in prison, a civil case related to the HealthSouth accounting fraud led to him being found liable for $3.2 billion in damages—a case in which Scrushy now is wanting Bradley disqualified from representing him so the verdict could be overturned and the case reopened.”
• “In the Wade Tucker case, Judge Elisebeth French heard arguments in the disqualification case Nov. 13. Scrushy made motions to disqualify Bradley under Bar rules 1.7, 1.9 and 1.10 dealing with current and former clients and imputation of conflicts of interest, as well as rule 3.7 concerning attorneys not representing Bradley in the Nov. 13 hearing because they were necessary witnesses in the case, Austin said. The judge denied the rule 3.7 motion from the bench and has not ruled on the others, he said.”
• “In the malpractice case, Scrushy names as defendants the Bradley firm and firm partner Chris Glenos, retired partner Meade Whitaker, and ‘John/Jane Doe Partners 1-10’ who were ‘decision-making partners’ and ‘responsible for authorizing of concealing the conflicted representation.'”
• “Bradley was scheduled to file its answer Friday but convinced the judge to delay filing because the firm’s new lawyer in the case, Tabor Novak III of Starnes Davis Florie in Birmingham, needed more time to learn about it, Austin said.”
• “Scrushy alleges that Bradley lawyers in 1998 were hired to represent him and his interests but later began representing HealthSouth in 2002 ‘first on corporate matters, then in positions increasingly adverse to Mr. Scrushy.'”
  ‘Bradley never notified Mr. Scrushy of this dual allegiance,’ the complaint states. ‘Instead, it suppressed and concealed this conflict while benefiting from privileged access to [Scrushy’s] strategy and decision-making.'”
• “But an affidavit by the firm’s former partner, Whitaker, that was filed in the Wade Tucker case in August stated that he represented the firm in Scrushy’s personal real estate and trademark matters but said he was not part of the firm’s representation of HealthSouth as part of the fraud investigation.”

“Rule on Multidistrict Litigation’s First Steps Goes Into Effect” —

• “A new federal rule governing the first steps for multidistrict litigation is set to take effect Monday [12/1], the result of years of debate over the measure and what it should include.”
• “Multidistrict litigation now makes up well over half of all federal civil cases, with lawsuits that address product liability and other topics consolidated before one judge to avoid them being filed in different courts and resulting in potentially different pretrial rulings. The new rule, 16.1 under the Federal Rules of Civil Procedure, is meant to give judges and parties a framework to get those cases off the ground, while still giving them the chance to modify them as needed for each case.”
• “Those opening steps include an initial management conference to figure out pretrial proceedings. The rule also says parties should provide a report ahead of that conference to lay out their views on whether leadership counsel should be appointed in the case, and if so, what their roles should be.”
• “Parties should also tell the court their initial views on discovery in the litigation, how parties will share information about the factual bases behind their arguments, and the main factual and legal issues that are likely to come up, the rule says.”
• “Some lawyers told Bloomberg Law they had concerns about earlier drafts of the rule, saying too much rigidity would hurt the MDL process by forcing courts to follow steps that don’t fit all cases. The Judicial Conference’s Committee on Rules of Practice and Procedure unanimously approved a version that its authors said was meant to be adaptable.”
• “Some plaintiffs’ lawyers also testified that they thought too many topics were included in the list of items that could be addressed at the initial hearing. The advisory committee drafting the rule said it’s not meant to serve as a mandatory agenda that requires a view on each listed issue.”
• “Class action lawyers also told Bloomberg Law the rule seemed focused more on mass tort MDLs rather than their cases, which commonly involve data breaches, privacy, and antitrust issues.”
• “The rule has its supporters. Implementing initial steps in the cases gives a pathway for finding and dismissing claims that don’t belong in the litigation, said Alex Dahl, general counsel for the advocacy group Lawyers for Civil Justice, which has pushed for the new MDL rule.”
• “‘This rule should strongly discourage the filing of meritless claims and give courts and parties an effective mechanism for identifying and dismissing them at the early stages of a new MDL,’ Dahl said in a statement.”