Disqualifying Plaintiff’s Litigation Counsel based upon Former Joint Defense Agreement

By Dennis Crouch

In re Shared Memory Graphics LLC (Fed. Cir. 2011), Opinion by Judge Dyk, dissent by Judge Newman (Can you believe that these two would disagree?)

This case involves a disqualification motion. Nintendo (the alleged infringer) was sued for infringement by SMG. The firm of Floyd & Buss represents the plaintiffs and the firm’s partnership includes Kent Cooper who is the former IP director at Advanced Micro Devices (AMD).

While Cooper was at AMD, Nintendo and AMD were co-defendants in a separate patent infringement lawsuit and part of a joint defense agreement. The JDA included a provision that the agreement would not be used to “seek to disqualify the respective counsel of such party in any future litigation.” However, Nintendo argued in the JDA does not apply to Cooper because he is no longer AMD’s counsel. The district court agreed with this interpretation disqualified the Floyd & Buss firm based upon the conclusive presumption that Cooper had access to Nintendo’s confidential information. (The district court more broadly disqualified Floyd & Buss from representing the plaintiffs against any of the accused infringers.)

On writ of mandamus, the Federal Circuit reversed – finding that the plain language of the JDA covered Cooper even after he left his position at AMD. The court also held that such a waiver is enforceable – especially when signed by two sophisticated parties.

In dissent, Judge Newman suggested that Cooper’s switching of sides and failure to maintain confidences is damning to our system of professional legal representation: “the issue is the integrity of the system of legal representation in today’s world of mobile lawyers and large law firms with interacting clients. . . . [I]t appears that Cooper in his new employment is associated with issues involving his former employer, and that his former employment was at the highest level in interaction with Nintendo’s legal and strategic interests. If there is doubt, it must be resolved in favor of the entity whose information is in jeopardy.”

 

9 thoughts on “Disqualifying Plaintiff’s Litigation Counsel based upon Former Joint Defense Agreement

  1. Well the opinion of a “sophisticated” non-attorney may not be welcome here, but I do think this is a prime example of an instance where the court of common sense should trump all the technicalities and legal nits that have evolved and stacked up to obscure actual logic, equity and common sense.

    Cooper and his new firm should be disqualified. Period.

  2. Judge Newman seems to have the better of the argument, if for no other reason than the standard of review for mandamus petitions. The majority’s analysis is good, but I don’t think their conclusion is “clear and indisputable.”

  3. The Agreement says “nothing in this Agreement, nor compliance with the terms of this Agreement by either party, shall be used as a basis to seek to disqualify the respective counsel of such party in any future litigation.” There is no waiver of conflicts arising outside the Agreement. At first that made me leery of Dyk’s view.

    However, read a little deeper. “Nothing contained in this Agreement has the effect of transforming outside or inside counsel for either party into counsel for the other party, or of creating any fiduciary or other express or implied duties between a party or its respective counsel and the other party or its respective counsel.” If Cooper while at AMD obtained confidential information from Nintendo, well that simply didn’t create an attorney client relationship between Nintendo and Cooper that Nintendo could later assert vis-a-vis Cooper.

    In this case, I agree with Dyk. Parties have to be able to enter Joint Defense Agreements that allow them to work together. If the earlier case had the effect of disqualifying the attorneys for all future cases, that would be worse than what Newman writes about.

  4. Makes me think of B leaving PHK&K and then stalling and sharing info so with the help of Sotelo and Tamai and Litman and everyone else involved they could just Sh@t on 08,677,556 with a strap making it a TWO Invention Patent and the Strap clearly proven to be what HE added not me. Check my Diary. Check the Strap they stole. It looks nothing like the one in the Application. Because their wasn’t one! They changed it just like they changed the Drawings on the first one! Now look at my Strap. It was just a piece of Velcro that decided it’s length. That is why when I saw the Slide Bar one while on a Boat… I never even logged my Strap! Check the stolen Check out. Why was it written in “His handwriting?” And why wasn’t it ever cashed? Elementary I never filed an Application on it!!!!!!!!!!!!!!!!!!!!!!!!!!!! SO WHY WAS THE STRAP THEN ADDED? Rocket Science? NO, common sense!

  5. discarding our dam ned system of legal representation

    Come up with a system to replace it that works as well, then we can discuss.

  6. If what D says is true then I agree with Dyk and Newman on everything save for Newman’s proposed solution. Newman proposes to settle the situation by simply resolving the issue in favor of the party whose info is in jeopardy. I propose that we settle the situation by discarding our dam ned system of legal representation in today’s world.

  7. “Admittedly, the firm did not screen Cooper upon his entry.”

    Looks like some outstanding conflict checking procedures were in use at that firm.

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