Jamaica Public Service Co. Ltd. v. AIU Insurance Company, et al., 1998 N.Y. Int. 0165 (Dec. 17, 1998).

PROFESSIONAL RESPONSIBILITY - DISQUALIFICATION - CONFLICT OF INTEREST - SUBSTANTIAL DANGER

ISSUE & DISPOSITION

Issue

Whether the appellate court was correct in disqualifying Plaintiff's law firm because an attorney at the firm had previously represented a division of Defendant corporation.

Disposition

No. Without deciding whether the attorney had an attorney-client privilege with Defendant, the Court of Appeals held that DR 5-108(a)(1) was not violated because there was no substantial relationship between the past and current representation.

SUMMARY

The Mendes firm represented an adversary of a division of AIG. Peter Samaan, an attorney with Mendes and Mount, previously represented a different division of AIG. AIG moved to disqualify Mendes and Moundt based on Samaanês prior representation of a division of AIG.  The trial court and appellate division agreed with AIG and disqualified Mendes and Moundt.  The New York Court of Appeals reversed.

The Court held that AIG failed to show that Samaanês prior representation was related to his current representation of AIGês adversary.  The Court noted that the case for which disqualification was sought did not involve matters
covered in Mr. Samaanês prior representation.  Because there was no substantial relationship between Mr. Samaanês past and current representation, there was no ground for disqualification and DR 5-108(a)(1) had not been violated.  In essence, the Court held, the matters Mr. Samaan dealt with for an AIG division previously were not related to the matters currently litigated (no -substantial relation") and thus there was no violation of the professional responsibility code.

The Court dismissed several other arguments proffered by AIG.  First, AIG argued that disqualification was warranted because Samaan was aware of AIGês corporate structure.  But because the structure is -generally known" by
reference to publicly available documents, this was no basis for disqualification.  Next, the Court denied that the information that Samaan possessed posed a -real and substantial" danger of abuse in present litigation.  Finally the Court of Appeals noted in dicta that allowing a low standard for disqualification based on -generalized assertions of .access to confidences'" would encourage the strategic use of disqualification motions.

Prepared by the liibulletin-ny Editorial Board.