3 tips for attorneys who are facing a motion to disqualify

Motions to disqualify are often frustrating for attorneys. An attorney focused on her client's claims or defenses suddenly finds herself thrust into the spotlight and forced to justify her actions. While no attorney enjoys litigating their own conduct, motions to disqualify are not uncommon and can raise thorny questions, even if they are at times derided as nothing more than a litigation tactic.

As observed in a recent California federal district court decision disqualifying counsel, a motion to disqualify "ultimately involves a conflict between a client's right to chosen counsel and the need to maintain ethical standards of professional responsibility." Abhari v. Victory Park Capital Advisors, Inc., CV2005734PAMAAX (C.D. Cal. Nov. 13, 2020) (appeal filed, Nov. 17, 2020) (citation omitted). While disqualification "usually imposes a substantial hardship on the disqualified attorney's innocent client," courts hold that "the recognizably important right to choose one's counsel must yield to the ethical considerations that embody the moral principles of our judicial process." Id. (citations omitted).

Given those serious concerns, courts do not take motions to disqualify lightly, nor should attorneys. In addition to requiring significant expense to address, motions to disqualify inject uncertainty into cases and can bring cases to a standstill. Where there are significant ethical issues, courts may grant motions to disqualify even without evidence of bad intent by an attorney. Instead, the concern is typically whether the client's former attorney or law firm had access to confidences or secrets that can be used against their former client, and the degree to which that concern should take priority over the new client's right to counsel of its choice.

Although the ethical concerns underpinning a motion to disqualify can arise in a wide variety of contexts, a common situation for motions to disqualify involves a former client either of the opposing law firm or of an individual attorney at that law firm who may have recently joined the firm. Indeed, increased lateral movement among law firms, often involving entire groups of attorneys leaving firms, has led to a number of motions to disqualify in recent years.

As a result, it is important to consider how to analyze and respond to a motion to disqualify. Below are three key considerations.

The "Substantial Relationship" Test

The California Rules of Professional Conduct do not contain an outright bar on the representation of current clients against former clients. Instead, Rule 1.9(a) of the California Rules provides that "[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 written consent."

Courts have observed that the "'substantial relationship' test examines the similarities between the two factual situations, the legal questions posed, and the nature and extent of the attorney's involvement with the cases." Caldwell v. City of San Francisco, 12-CV-01892-DMR (N.D. Cal. Jan. 25, 2021) (citations omitted). The comments to Rule 1.9 also provide guidance, noting that matters are substantially related if they "involve the same transaction or legal dispute or other work performed by the lawyer for the former client ... or ... if the lawyer normally would have obtained information in the prior representation that is protected by [confidentiality rules], and the lawyer would be expected to use or disclose that information in the subsequent representation because it is material to the subsequent representation."

Based on this rule, the former client may allege that the attorney obtained "insider information" through the prior representation of the client, even where the later matter is ostensibly unrelated. Such information may include knowledge regarding the former client's preferred strategy or settlement tactics, which is often referred to as "playbook knowledge."

A motion to disqualify premised on "playbook knowledge" can be compelling in certain circumstances and less meaningful in others. As noted in a comment to Rule 1.9 of the ABA Model Rules of Professional Conduct, "[i]n the case of an organizational client, general knowledge of the client's policies and practices ordinarily will not preclude a subsequent representation."

Potential Preventative Measures

As noted above, even baseless motions to disqualify can be harmful given the potential for delay and the expense required to oppose the motion. Thus, to the extent possible, many law firms will take steps to prevent motions to disqualify from being filed in the first place. In most circumstances, this involves following and observing the conflicts rules, particularly when it comes to hiring lateral attorneys.

Indeed, many motions to disqualify can be avoided by identifying and resolving any conflicts of interest at the time a lateral is hired and prior to undertaking new representations. If necessary, obtaining effective consent from the former client could provide the law firm with a very strong defense in the event that the former client later moves for disqualification.

Second, a law firm can use various strategies to reduce, or even eliminate, the possibility that a former client's confidences will be accessed by the attorneys working on a subsequent matter involving the former client. A number of courts have recognized, for example, that an ethical wall can effectively address the risks that the former client's confidences will be used against it in the later matter.

Considerations for Responding

The first course of action when receiving a motion to disqualify is typically to notify the client. Depending on the circumstances, a law firm may also consider reporting the motion to its legal malpractice insurer.

Another important consideration is whether a firm should itself-defend the motion to disqualify, or whether the motion would be better handled by separate, independent counsel. 