Counsel Disqualified for Failing to Terminate Client Relationship

18 July 2013 IP Litigation Current Blog

Recently, a district court granted a motion by defendant in a patent litigation to disqualify plaintiff’s counsel because that counsel had previously done opinion-related work for the defendant and did not terminate the attorney-client relationship. The case provides a telling example of the importance of formalizing the official end of such a relationship.

Plaintiff’s counsel had performed the opinion work for the defendant for about six years (2006-2012). The last of this work started in 2010 and the last services performed by counsel for the matter were in February 2012. While there was a dispute between plaintiff’s counsel and the defendant as to whether there was an exchange in February 2012 concerning whether the work at hand was complete, the parties agreed that there were no further communications regarding the matter until counsel began to represent the plaintiff several months later.

The court explained that the counsel “was unable to articulate at the hearing any basis to suggest that [defendant] would not have expected to use [counsel's] legal services to evaluate the further developments in the [] matter … The Court finds that [defendant] had a reasonable expectation that [counsel] would continue to act as its lawyer in the [] matter and that [counsel] failed to give [defendant] reasonable notice to the contrary before undertaking the adverse representation of [plaintiff] in this matter.” The court did not undergo an analysis of whether the two matters were “substantially related” as “[t]hat question only presents itself if [defendant] is considered a former client at the time [counsel] took the [plaintiff] representation in this case.”

The text of the decision is available here.

This case illustrates the potential pitfalls of failing to formalize the end of an attorney-client relationship. In this particular case, there was debate over whether counsel was told by the defendant during a phone call that no additional work on the matter was needed. Naturally, putting such communications unambiguously in writing can help to alleviate such issues.

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