Bressler Risk Blog

Time for another BRB experiment. This time I’m conducting a quick (5 minute) reader poll on everyone’s favorite topic: OCGs.

Last week an old friend and director of risk at an Am Law 100 firm reached out, looking for insight into law firm trends on managing outside counsel guidelines. Specifically, he wanted to understand how many firms have created a dedicated position on their NBI/conflicts teams (or on another team) to manage OCGs.

I pointed him at a few examples I’ve seen in the wild, but it sparked a discussion resulting in this quick poll.

So if you have a role like this at your firm – or if you’re planning or hoping to create one – please take five minutes to: Take the survey here. [Ed: Survey Now Concluded] (And if you don’t have one and care to share why, that would be helpful context to collect as well.)

Let’s see what we learn…

“Hogan Lovells Accused Of Conflict Of Interest In Tycoon’s Suit” —

• “Lawyers for Vadim Shulman [bio, via Organized Crime and Corruption Reporting Project, noting Paradise Papers] alleged in the High Court that breaches by Hogan Lovells International LLP cost him the chance of securing a settlement against Igor Kolomoisky and Gennadiy Bogolyubov in London in connection with an allegedly fraudulent loan scheme concerning a defunct Ohio steel plant… Shulman says Hogan Lovells was actively pursuing a retainer with Ukrainian-based PrivatBank while still contracted to him.”
• “Shulman and PrivatBank were racing for ‘the same pool of assets’ belonging to Kolomoisky and Bogolyubov, said Jonathan Marks QC, counsel for Shulman. Hogan Lovells owed Shulman a ‘duty of undivided loyalty,’ which would have been breached by the law firm’s discussion with the lender, he added.”
• “Marks told the court that Hogan Lovells “preferred the interests” of PrivatBank, helping the bank obtain its own $2.6 billion freezing order against the two men in December 2017. Shulman wants to add claims that the law firm must have begun work on the order before their relationship ended. Hogan Lovells says it did not begin working for PrivatBank until August 2017. By this time, Shulman’s $500 million fraud suit had been dismissed. An English court ruled it did not have jurisdiction on the claims in April 2017.”
• “But Shulman now alleges that Hogan Lovells’ discussions with PrivatBank about its much larger claim overlapped with its obligations to him. Shulman’s lawyers also want to be able to cross-examine partners at the law firm over evidence concerning the retainer date.”

“SRA wants to see evidence gathered from Pandora papers leak” —

• “The Solicitors Regulation Authority has said it wants to see documents released as part of the Pandora papers to establish whether any law firm has breached anti-money laundering rules.”
• “Several firms have been named this week as part of the ongoing coverage from leaked files of companies that specialise in creating offshore companies and trusts. The Guardian reports today that London firm Farrer & Co took instructions from a client called Abubakar Bagadu, a Nigerian politician accused of involvement with a corruption scheme through which billions of dollars were stolen from the state.”
• “Farrer & Co, renowned as legal advisers to the Royal Family, told the newspaper it carried out extensive due diligence on Bagadu and there is no suggestion of wrongdoing on the firm’s part.”
• “The SRA has specific requirements of firms to carry out proper checks on clients before taking them on, as part of regulations to prevent money laundering. Firms need to risk assess relevant clients, identify and verify their identities and identify their sources of funds and wealth. Where relevant to the size and nature of the business, firms must also undertake an independent audit, screen their staff and appoint a money laundering compliance officer.”
• “There is no suggestion that any firm named in the Pandora papers is in breach of these rules, but the SRA wants to see details of what information has been released to check if it needs to be involved.”

From Shari L. Klevens, partner at Dentons US: “Pay Attention to Conflict Issues in Hiring Nonlawyer Staff” —

• “The potential for conflicts of interest is not limited to attorneys. As the ethical rules recognize, the same considerations regarding the disclosure of a former client’s confidential information are present where a paralegal, legal assistant, or other nonlawyer moves from one firm to another. For that reason, firms and attorneys can be subject to some of the same restrictions based on the prior work of a nonlawyer as they would for a conflicted lawyer.”
• “California courts have also weighed in on the issue. In Kirk v. First Am. Title Ins. Co., the California Court of Appeals observed that when a tainted non-attorney employee of a law firm, possessing confidential case information, moves to an opposing law firm, vicarious disqualification of the opposing law firm is not necessary if the employee is effectively screened… Kirk further applied the same rule to a non-retained expert, which is another area that can give rise to potential conflicts but often is overlooked.”
• “The majority of states that have addressed this issue have similarly found that appropriate ethics screens may avoid an imputed conflict of interest when a nonlawyer brings a conflict to a new firm. For example, in Hodge v. Urfa-Sexton, LP, the Georgia Supreme Court held that the screening of nonattorney staff ‘is a permissible method to protect confidences held by nonlawyer employees who change employment.’ 295 Ga. 136 (2014). The court explained that a nonattorney’s conflict of interest may be remedied if the law firm employing that nonattorney uses effective and appropriate screening measures and promptly discloses the conflict.”
• “Conflicts can be an important consideration prior to the actual hiring of nonattorney staff. Some firms use a written application that inquires about the candidate’s prior legal employment, relationships with attorneys, and legal experience. If the conflicts system reveals that the prospective nonattorney staff hire has worked for, has experience with or is related to matters involving clients of the firm, then the hiring firm can conduct further inquiry.”
• “Indeed, the definition of ‘screened’ in the California Rules of Professional Conduct refers to the “timely imposition of procedures” to protect against the disclosure of information, which can be easier to accomplish if the firm has knowledge of potential issues in advance of hiring.”
• “The comments to Rule 1.10 further suggest that the obligation to identify potential conflicts among nonlawyers and to implement screening measures is part of an attorney’s responsibilities in managing or supervising nonlawyers pursuant to Rule 5.3.”

“New ABA ethics opinion clarifies obligations for language access in lawyer-client relationships” —

• “Attorneys often must take affirmative steps to ensure that they can communicate effectively with clients with limited English proficiency or with those with noncognitive physical disabilities, such as a hearing or a speech impairment.”
• “This may require the lawyers to engage an interpreter, translator or other assistive or language-translation technology, according to an ethics opinion released Wednesday by the ABA’s Standing Committee on Ethics and Professional Responsibility.”
• “The bulk of the opinion explains that when confronted with clients with language barriers, lawyers must obtain a qualified, impartial interpreter or translator who can understood and explain the law and legal concepts in the language of the clients.”
• “Lawyers may use ‘a multilingual lawyer or nonlawyer staff member within the firm to facilitate communication with a client.'”
• “The opinion adds that sometimes a friend or family member of the clients may function as the interpreter. But in these instances, lawyers must take particular care to ensure that such a friend or family member is not biased by a personal interest.”
• “If lawyers cannot obtain such an interpreter or translator without incurring ‘an unreasonable financial burden’ on the attorneys or the clients, then the attorneys should either decline or withdraw from representation.”
• “Finally, the opinion explains that attorneys must be cognizant of ‘social and cultural differences that can affect a client’s understanding of legal advice, legal concepts, and other aspects of the representation.’ The lawyers cannot assume that an interpreter or translator understands these social and cultural differences simply because the person can interpret and knows the client’s language.”

“Eckert Can’t Dodge Conflict-Of-Interest Suit, Game Maker Says” —

• “A Georgia-based game machine maker has urged a Pennsylvania federal court to deny a partial motion to dismiss its amended complaint against its onetime law firm, Eckert Seamans Cherin & Mellott LLC, which it accuses of breaching a fiduciary duty by working both for and against the company in different jurisdictions.”
• “Pace-o-Matic Inc., which refers to itself as an amusement machine supplier, on Friday accused the Pittsburgh-based law firm of knowingly engaging in a conflict of interest by representing Greenwood Gaming & Entertainment Inc. — which does business as Parx Casino — in litigation against the game maker. It further alleges that Eckert falsely denied involvement in the litigation and ‘surreptitiously’ worked through Hawke McKeon & Sniscak LLP ‘to conceal its breaches of fiduciary duty.'”
• “Pace-o-Matic had hired Eckert Seamans to represent it in a lawsuit in Virginia in 2016, where the firm argued that Pace-o-Matic’s game machines required the use of skill and therefore weren’t illegal gambling machines. But in 2018, when Pace-o-Matic filed two lawsuits in Pennsylvania over the removal of its games, Eckert Seamans took the opposite position and argued in an amicus brief for the casino operator that Pace-o-Matic’s products were gambling machines and should be barred, the game maker says.”
• “In April, the court denied the law firm’s argument against Pace-o-Matic’s motion for a preliminary injunction as moot, saying that Eckert Seamans’ declarations that it had withdrawn from representing Parx Casino weren’t enough to guarantee that it wouldn’t resume that representation, likening it to ‘pinky promises.'”
• “Regarding Eckert’s motion to dismiss, Pace-o-Matic said the firm echoed arguments made in its failed motion for a preliminary injunction, specifically that declaratory relief was unavailable because the issue occurred in the past.”
• “Further, Pace-o-Matic asked the court to dismiss Eckert’s argument that punitive damages were not available because the amended complaint did not allege ‘outrageous’ conduct. The game maker argued that federal and Pennsylvania courts have consistently held that intentional misrepresentations and knowing breaches of fiduciary duty are sufficient to support a demand for punitive damages.”

“Kirkland, KWM on Evergrande Group’s ‘Lehman Scale’ Crisis” —

• “Top global law firms are already involved in the debt crisis surrounding China Evergrande Group, the real estate company whose unwieldy debt has prompted concern around the globe about China’s financial system.”
• “King & Wood Mallesons has been appointed by the Chinese government to investigate the financial indebtedness of the company, according to a Bloomberg report. Kirkland & Ellis has been engaged to represent a group of bondholders to advise it on the potential restructuring of Evergrande.”
• “According to Eversheds Sutherland debt restructuring partner Kingsley Ong, Evergrande now faces a myriad of legal issues, including how much time will creditors indulge in the company, claims from employees, applications for insolvency protection of on- and offshore assets, for starters. The long list of creditors will also need strong legal representation for claims.”
• “Many top law firms have previously acted for Evergrande. As recently as this past May, Baker McKenzie advised Evergrande on its US$1.36 billion sale of shares. Last December, Sidley Austin represented Evergrande subsidiary, Evergrande Property Services Group Ltd., on its US$1.4 billion Hong Kong initial public offering. Last August, Sidley also advised Evergrande on a US$3 billion strategic investment from 14 investors.”
• “The potential conflicts, given the long list of Evergrande creditors, most of whom are based in Asia, are far-reaching. Firms such as Clifford Chance and Linklaters have also declined to comment. Akin Gump Strauss Hauer & Feld, Latham & Watkins, Fangda Partners and Zhong Lun Law Firm all did not respond to requests for comment.”

“McGuireWoods Faces DQ Bid In BofA Foreclosure Bias Fight” —

• “Keith Thomas told the court on Friday that McGuireWoods is violating the state’s legal ethics rules by representing itself, Bank of America NA and mortgage database company Mortgage Electronic Registration Systems Inc. in the case. Thomas, who is representing himself, cited a 1987 Georgia Supreme Court case known as Cherry v. Coast House that found that attorneys who are parties to a case should not represent co-parties in a matter, according to Friday’s motion.”

Plenty being written about these new revelations. Have had an eye out for interesting law firm angles in: “Pandora Papers: An offshore data tsunami” —

• “The Pandora Papers investigation also reveals how banks and law firms work closely with offshore service providers to design complex corporate structures. The files show that providers don’t always know their customers, despite their legal obligation to take care not to do business with people who engage in questionable dealings.”
• “ICIJ analyzed 109 so-called suspicious activity reports to financial authorities filed by the Panamanian law firm Alemán, Cordero, Galindo & Lee, or Alcogal, and learned that 87 of the anti-money-laundering forms were written only after authorities or journalists had publicly identified the firm’s clients as involved in alleged wrongdoing.”
• “ICIJ also read through several thousand publicly available employees’ profiles and found out that more than 220 lawyers associated with the giant law firm Baker McKenzie in 35 countries had previously held government posts in agencies including justice departments, tax offices, the EU Commission, and offices of heads of state.”

“BILLIONS HIDDEN BEYOND REACH” —

• “Executives at a politically connected Panama City law firm, for example, mentioned in a 2016 email ‘numerous requests from clients to confirm the security of our information systems’ after the Panama Papers stories, according to documents. The executives scrapped plans to convert paper records to digital storage, hoping to reassure wary clients.”
• “Executives at a politically connected Panama City law firm, for example, mentioned in a 2016 email ‘numerous requests from clients to confirm the security of our information systems’ after the Panama Papers stories, according to documents. The executives scrapped plans to convert paper records to digital storage, hoping to reassure wary clients.”
• “The trove, dubbed the Pandora Papers, exceeds the dimensions of the leak that was at the center of the Panama Papers investigation five years ago. That data was drawn from a single law firm, but the new material encompasses records from 14 separate financial-services entities operating in countries and territories including Switzerland, Singapore, Cyprus, Belize and the British Virgin Islands.”
• “The revelations include more than $100 million spent by King Abdullah II of Jordan on luxury homes in Malibu, Calif., and other locations…. The disclosures come as Abdullah is facing political turmoil, including an alleged coup plot this year, in a kingdom that depends on billions of dollars in aid from the United States and other countries. DLA Piper, a law firm representing Abdullah, said that ‘any implication that there is something improper about [his] ownership of property through companies in offshore jurisdictions is categorically denied.”

Hat tip to an extended, longtime reader for sending in the following via electronic pony express: “131 Federal Judges Broke the Law by Hearing Cases Where They Had a Financial Interest” —

• “More than 130 federal judges have violated U.S. law and judicial ethics by overseeing court cases involving companies in which they or their family owned stock. A Wall Street Journal investigation found that judges have improperly failed to disqualify themselves from 685 court cases around the nation since 2010. The jurists were appointed by nearly every president from Lyndon Johnson to Donald Trump.”
• “About two-thirds of federal district judges disclosed holdings of individual stocks, and nearly one of every five who did heard at least one case involving those stocks. Alerted to the violations by the Journal, 56 of the judges have directed court clerks to notify parties in 329 lawsuits that they should have recused themselves. That means new judges might be assigned, potentially upending rulings.”
• “The Journal reviewed financial disclosure forms filed annually for 2010 through 2018 by roughly 700 federal judges who reported holding individual stocks of large companies, and then compared those holdings to tens of thousands of court dockets in civil cases. The same conflict rules apply to criminal cases, but large companies are rarely charged, and the Journal found no instances of judges holding shares of corporate criminal defendants in their courts. It found that 129 federal district judges and two federal appellate judges had at least one case in which a stock they or their family owned was a plaintiff or defendant.”
• “In New York, Judge Edgardo Ramos handled a suit between an Exxon Mobil Corp. unit and TIG Insurance Co. over a pollution claim while owning between $15,001 and $50,000 of Exxon stock, according to his financial disclosure form. He accepted an arbitration panel’s opinion that TIG should pay Exxon $25 million and added $8 million of interest to the tab.”
• “In Colorado, Judge Lewis Babcock oversaw a case involving a Comcast Corp. subsidiary, ruling in its favor, while he or his family held between $15,001 and $50,000 of Comcast stock.”
• “At an Ohio-based appeals court, Judge Julia Smith Gibbons wrote an opinion that favored Ford Motor Co. in a trademark dispute while her husband held stock in the auto maker. After she and the others on the three-judge appellate panel heard arguments but before they ruled, her husband’s financial adviser bought two chunks of Ford stock, each valued at up to $15,000, for his retirement account, according to her disclosure form.”
• “Judge Ramos, who oversaw the Exxon case, was unaware of his violation, said an official of the New York federal court, because his ‘recusal list’—a tally judges keep of parties they shouldn’t have in their courtrooms—listed only parent Exxon Mobil Corp. and not the unit, whose name includes the additional word ‘oil.’ The official said the court conflict-screening software relied on exact matches.”
• “‘I dropped the ball,’ Judge Babcock said when asked about the recusal violation. He blamed flawed internal procedures. ‘Thank you for helping me stay on my toes the way I’m supposed to,’ he said. A Comcast spokeswoman declined to comment.”
• “Judge Gibbons from the Ford trademark case, appointed to the appeals court by former President George W. Bush, said she had mistakenly believed holdings in her husband’s retirement account didn’t require her recusal. She later directed the clerk of the Sixth U.S. Circuit Court of Appeals to notify the parties of the violation and said that her husband has since told his financial adviser not to buy individual stocks. ‘I regret my misunderstanding, but I assure you it was an honest one,’ she said.”
• “In response to the Journal’s findings, the Administrative Office of the U.S. Courts said: ‘The Wall Street Journal’s report on instances where conflicts inadvertently were not identified before a case was resolved or transferred is troubling, and the Administrative Office is carefully reviewing the matter.’
• “It said the federal judiciary ‘takes very seriously its obligations to preclude any financial conflicts of interest’ and has taken steps, such as conflict-screening software and ethics training, to prevent violations. ‘We have in place a number of safeguards and are looking for ways to improve,’ the office said.”
• “In response to the Journal’s findings, the Administrative Office of the U.S. Courts said: ‘The Wall Street Journal’s report on instances where conflicts inadvertently were not identified before a case was resolved or transferred is troubling, and the Administrative Office is carefully reviewing the matter.’
• “It said the federal judiciary ‘takes very seriously its obligations to preclude any financial conflicts of interest’ and has taken steps, such as conflict-screening software and ethics training, to prevent violations. ‘We have in place a number of safeguards and are looking for ways to improve,’ the office said.”

“Judge Rodney Gilstrap Sets an Unwanted Record: Most Cases With Financial Conflicts” —

• “No federal judge in America has heard more patent-infringement lawsuits in the past decade than Rodney Gilstrap, who presides over a small courthouse in Marshall, Texas.”
• “He also holds another record: Judge Gilstrap has taken on 138 cases since 2011 that involved companies in which he or a family member had a financial interest, more than any other federal judge, a Wall Street Journal investigation shows.”
• “The companies included Microsoft Corp. (53 cases), Walmart Inc. (36 cases), Target Corp. (25 cases) and International Business Machines Corp. (9 cases).”
• “A 1974 federal law requires judges to disqualify themselves from cases if they, their spouse or minor children hold a financial interest in a plaintiff or defendant, including the interest of a beneficiary in assets held by a trust.”
• “Judge Gilstrap, the chief judge for the U.S. District Court for the Eastern District of Texas, also disclosed one of the largest holdings in a conflicted company. He oversaw a patent-infringement case against a Walt Disney Co. unit while he or his wife reported holding between $100,001 and $250,000 of Disney stock. The plaintiff later withdrew its claim.”
• “The 64-year-old Judge Gilstrap, one of America’s most prominent district judges, said he believed he didn’t need to recuse himself from some cases because they required little or no action on his part, and in other cases because the stocks were in a trust created for his wife without her stock-picking input. Legal-ethics experts disagree on both counts.”
• “‘Judge Gilstrap declined interview requests. ‘I take my obligations related to potential conflicts/recusals seriously,’ he said in one of seven emails to the Journal. ‘Throughout my judicial career, I have endeavored to comply with all such obligations, and I will continue to do so.'”
• “Beyond violating law and ethics, the judges’ handling of lawsuits filed by and against companies in which they have financial interests threatens the federal courts’ hard-earned and crucial reputation for fairness, impartiality and objectivity.”
• “An unusually large role in patent litigation has made the Eastern District of Texas a lightning rod for criticism from some academics, corporations and think tanks. These critics say its rules encourage patent holders to bring suits there because they are dispatched swiftly, often with quick settlement payouts to the plaintiffs. A 2016 article in the Southern California Law Review described how it said the court engaged in ‘forum selling,’ a pejorative twist on “forum shopping,” the practice of lawyers seeking out friendly legal venues.”

“EU anti-money laundering directive costing UK law firms nearly £1m each” —

• “Implementation of the Fifth Anti-Money Laundering Directive (5MLD) is costing the UK legal sector on average 12% more than for other regulated industries with a majority of compliance professionals unconvinced on the directive’s value in detecting and preventing financial crime, according to new research.
• “The research by LexisNexis Risk Solutions revealed the implementation of 5MLD costs £940,200 per law firm, compared to an average of just over £836,000 across other sectors.”
• “Kerkez added the results foreshadow a ‘difficult future’ for law firms trying to keep up with changing compliance requirements should they not adopt the right technology to streamline compliance checks and create a more flexible, risk-based approach to compliance matters.”
• “Kerkez said the results point to a ‘perennial conflict’ within firms between fee earners who want to onboard clients quickly and compliance teams who try to minimise the firm’s exposure to risk. ‘This is an area that 5MLD and the requirement to demonstrate a risk-based approach to compliance are putting additional pressure on,’ she said. ‘The reality is, firms can have the best of both worlds; fast, frictionless and safe onboarding, alongside robust and ongoing assessment of client risk that protects the firm from exposure to financial crime, and therefore the reputational and financial damage that could come from dealing with the wrong client.'”

The SRA just posted: “Reflections on our September Board” —

• “The SRA Board held a quarterly monitoring meeting this week. Here we explored operational and financial performance, delivery against our business plan and looked at the strategic risk register. Perhaps that doesn’t sound like the most exciting meeting, but I think it is critical that the Board spend time on these matters to assure ourselves that the organisation is delivering as it should be for all our stakeholders.”
• “We noted good performance in most areas and anticipate closing the year in good shape. But we spent some time exploring the data on investigations. We are pleased that we continue to hit the target of concluding at least 93% of investigations within 12 months, but we would like to know more about the 7% of investigations that extend beyond 12 months. More information and further analysis will help us to understand what can be done to reduce delays going forward.”
• “More generally we are awaiting the results of an internal audit of our performance reporting data. This will give the Board assurance that the material we get is robust, but we have also asked the auditors to suggest areas for improvement based on good practice in similar organisations. We will then review the information we receive.”

Which sparked sharp comment on LinkedIn. Risk advisor/solicitor Frank Maher posted:

• “As I commented earlier on a previous posting of this, the delays in progressing even minor conduct issues are a serious problem and need close scrutiny. I cited the example of a minor employment dispute which was dismissed by an adjudicator after 15 months and should never have gone that far But it would have threatened the entire career of my client.”
• “Targets for disposing of investigations can have unintended consequences. I have one case where a response was requested in 14 days, as is usual, the allegations by a third party were nonsense and demonstrated a woeful misunderstanding of money laundering legislation but were nonetheless put to the solicitor by the SRA who should have seen the flaws in it. A 5 page response was provided in 7 days and the SRA say they ‘aim’ to respond in just under 14 weeks. How it can take that long defies belief. But it might just be that the 12 month target for responding to 93% of investigations is in fact perceived as an ‘allowance.'”
• “It is no good publishing sound bites about stress in the profession while simultaneously causing it. Those conducting the investigations appear to have absolutely zero understanding of the way in which they can ruin people’s lives and careers.”

And Jayne Willetts, solicitor advocate, echoed:

• “I echo the comments made by Frank Maher about delay. As an example I have just been instructed on a case where the SRA did not contact my client until over two years after the initial complaint had been made to the SRA. The explanation for the delay was that the SRA had been liaising with the complainant during the intervening two years. Is that a fair and balanced approach?”

It was time to remember to never forget to check in on Bill Freivogel’s latest findings:

In re Bear Communications, LLC, 2021 WL 4256161 (D. Kan. Sept. 17, 2021). Chapter 11.

• “The unsecured creditors’ committee applied to retain Law Firm as counsel to the committee. Various parties objected. One objection is that Law Firm represents an ‘affiliate’ of a major creditor in this case, in lobbying matters. The major creditor is Verizon Sourcing, LLC. The affiliate/client is Verizon Communications.”
• “In this opinion, applying 11 U.S.C. § 1103, the bankruptcy judge approved the retention. The court noted that under 11 U.S.C. § 328(c) the court can deny compensation to a professional who turns out to be not disinterested. Thus, Law Firm will have to employ ‘constant vigilance’ to avoid conflicts because its ‘compensation will be in jeopardy.'”
• “A number of things are not clear from the opinion: (1) the structure of Verizon’s corporate family; (2) the relevance, if any, of Law Firm’s status as a Swiss Verein; and (3) whether Law Firm will be representing Verizon Sourcing in this case. It appears that Verizon Sourcing is asserting a claim against Debtor of some $44 million and that Debtor is claiming that Verizon Sourcing owes Debtor some $12 million.”

Mauck v. Cherry Oil Co., Inc., 21 CVS 343 (N.C. Super. Ct. Sept. 20, 2021).

• “In this derivative action Law Firm appeared for the individual defendants and for the corporation in question. Plaintiffs moved to disqualify Law Firm. In this opinion the trial court denied the motion. North Carolina courts had not addressed the circumstances under which the same law firm could represent the alleged wrong-doers and the entity in question.”
• “The opinion contains a wide-ranging discussion of cases around the U.S. The analysis boiled down to whether the claim against the individual defendants ‘involves serious charges of wrongdoing.’ This is language appearing in Comment 14 to N.C. Rule 1.13 (apparently the same as Model Rule 1.13 and its Comment 14). The court said, in effect, ‘nothing serious here.’ The claim was essentially “a bitter family dispute” about the way the corporation should be run and Plaintiffs’ roles in the corporation.”

Madden v. Elara Caring, LLC, No. CIV-19-1178-G (W.D. Okla. Sept. 21, 2021)

• “Lawyer represents Plaintiff in this employment-related case. Lawyer had, for several years, served as an executive in several corporate predecessors of Defendant. At one point she had the title of ‘general counsel.’ Defendant moved to disqualify Lawyer.”
  “In this opinion the court denied the motion. While Lawyer did sign Plaintiff’s employment agreement for the company, she had not drafted it. In a routine former-client analysis the court found Lawyer’s involvement with the companies would not ‘materially advance’ Plaintiff’s position in this case.”

And, following Freivogel, because I’m a sucker for alliteration (and don’t know anything about soccer, though I’m sure there’s a clever word for a “second attempted shot on goal” that would do nicely here too): “Saxena White Can’t Lead FIFA Suit After Robbins Geller DQ” —

• “U.S. District Judge Louis L. Stanton tossed Robbins Geller off the case in May, finding the firm committed fraud by failing to disclose short positions held by an investor leading a certified class action over bribes Mexican media company Grupo Televisa SAB allegedly paid to soccer’s international governing body.”
• “Saxena White asked on Sept. 16 to take the reins, as the firm’s litigation director Steven B. Singer sought permission to work with Robbins Geller to get up to speed on the 3-year-old case. But the request appeared to perturb Judge Stanton, who cited Saxena White’s reliance on Robbins Geller as basis for denying the firm’s lead counsel bid Thursday.”
• “The Robbins Geller disqualification order ‘was a dishonorable discharge for lack of candor amounting to fraud upon this court,’ Judge Stanton wrote. ‘[Singer’s] presumption that the court would allow the easing of his firm’s burden by recourse to Robbins Geller and the reliance of Saxena White on continued work by Robbins Geller all weigh heavily against the approval of Saxena White as class counsel.'”
• “The case dates back to 2018, when Robbins Geller filed suit on behalf of a group of Grupo Televisa investors who say they were harmed by a drop in stock prices following trial testimony that the company had contributed to a $15 million bribe to secure rights to FIFA broadcasts. Judge Stanton certified the suit as a class action in June 2020. But the judge disqualified Robbins Geller a year later for failing to disclose that its original candidate for lead plaintiff, which claimed to have lost $986,000 in Grupo Televisa’s stock drop, in fact gained $11 million from shares it held in a Canadian hedge fund that had shorted the stock.”

“Judge Raises Conflict Concerns About Kellogg Hansen in Google Advertising Cases” —

• A federal judge has ordered Washington, D.C.’s Kellogg, Hansen, Todd, Figel & Frederick to explain how the firm plans to represent British newspaper Daily Mail in a lawsuit against Google over its digital advertising while also representing Facebook in an antitrust case brought by the Federal Trade Commission.”
• “Kellogg Hansen partner John Thorne filed an April 20 lawsuit against Google on behalf of Daily Mail publishers Associated Newspapers Ltd. and Mail Media Inc. Although his lawsuit is focused only on Google, it is now one of more than 20 lawsuits coordinated in multidistrict litigation. Facebook is named as a defendant in 16 of those lawsuits, which contend the social media company struck a ‘secret agreement’ in 2018 with Google to manipulate online auctions that generate digital advertising revenue.”
• “‘This is a present representation,’ Castel said to a room full of lawyers, who attended the hearing in person. ‘And there may be serious issues on duty of loyalty—duty of loyalty to the Daily Mail or Associated Newspapers, whatever it’s called—that may require you to recommend asserting a claim against Facebook, but you can’t do that because that’s your present client. There may be discovery sought of Facebook. There may be joint defense—not joint defense— joint prosecution meetings, in which strategy is discussed about how do most effectively build a case against Facebook? And I just don’t see how this can happen with the presence of a law firm that, as we speak, represents Facebook. Care to comment?'”
• “Thorne told the judge that Daily Mail had done an ‘extensive’ pre-investigation of its case and that Facebook was a “good partner’ of the Daily Mail. ‘If we ever got to a point where Daily Mail wanted to bring a case against Facebook, I would not be a part of it,’ he replied.”
• “Castel pushed further. ‘Should I bring you into a joint prosecution meeting on how to nail Facebook?’ he asked Thorne. Thorne insisted he could step out of those meetings, but Castel wasn’t convinced. ‘This is what I’m going to require you to do: To brief why there is not, in your view, a present conflict,’ he said. ‘And why it would not be a conflict for you to participate in group meetings?'”
• “‘I’m not accusing anybody of bad faith here, but it’s an odd lineup,’ Castel said at the hearing. ‘It’s a tough situation, and I don’t have a solution or answer as to how you get walled off in meetings.'”
• “The multidistrict litigation over Google’s digital advertising alleges the tech company violated federal and state antitrust laws. Lawsuits were filed on the heels of an Oct. 6, 2020, report by the House Judiciary Committee’s Subcommittee on Antitrust, Commercial and Administrative Law that suggested sweeping overhauls of antitrust law to address growing concerns that Google, Facebook, Amazon and Apple illegally monopolized their markets.”

“Faegre Drinker Facing DQ Bid In Del. Insurance Row” —

• ” Specialty insurance distributor Amwins Group is urging a Delaware federal judge to disqualify Faegre Drinker Biddle and Reath LLP from representing carriers it has sued for breach of contract, saying the firm may have a potential conflict of interest. In a brief filed on Thursday, Amwins Group LLC told U.S. District Judge Leonard P. Stark Faegre Drinker should be disqualified because it is ‘concurrently representing Amwins’ interests in a Texas case and adverse to Amwins in this case.'”
• “In its brief, Amwins contends Faegre Drinker should be disqualified because it represents a former Amwins subsidiary in an insurance case in Texas. ‘As the financially responsible party in the Texas case, Amwins has a vital financial interest in the Texas case,’ the brief said. ‘Amwins has paid $200,000 in legal fees and expenses to FD for its services in the Texas case.'”
• “Faegre Drinker has rejected a request to withdraw from the Delaware case and denied that it ‘owed any ethical duty to Amwins,’ according to the filing. However, Amwins argues that the firm ‘has a concurrent conflict of interest’ and should be barred from continuing to serve in the Delaware case.”