Attorney Ethics: Disqualifying a Law Firm

Outside the Box Innovations, LLC v. Travel Caddy, Inc., (Fed. Cir. 2010)(order)

In a non-precedential order, the Federal Circuit has disqualified the law firm of King & Spalding from representing Travel Caddy on appeal. At the district court level, Outside-the-Box was successful in proving that Travel Caddy’s patent should be held unenforceable due to inequitable conduct. In post-verdict motions, a King & Spalding partner (Tony Askew) filed an expert witness declaration on behalf of a Outside-the-Box indicating that the requested attorney-fees were reasonable. For the appeal, however, three other King & Spalding attorneys began representing Travel Caddy on the other side.

Writing for a unanimous appellate panel, Judge Dyk indicated that King & Spalding’s actions are improper regardless of whether Askew’s expert work created an attorney-client relationship with Outside-the-Box. In particular, the court noted the likelihood that King & Spalding’s new client Travel Caddy will need to challenge the sufficiency of the expert opinion that it provided earlier.

The question whether King & Spalding should challenge the expert opinion of one of King & Spalding’s partners in our view would materially and adversely affect the firm’s representation of Travel Caddy on appeal. We determine that Rule 1.7(a) is applicable. There has been no showing that Travel Caddy waived the conflict pursuant to GRPC 1.7(b), even assuming that the conflict is one that can be waived. For example, there is no written waiver included in the submissions; there has been no showing that Travel Caddy “received in writing reasonable and adequate information about the material risks of the representation”; or that Travel Caddy was “given the opportunity to consult with independent counsel.”

The case was litigated in Georgia and the Federal Circuit based its decision upon the Georgia Rules of Attorney Ethics. It did not seem to matter that the King & Spalding appellate counsel were all Texas attorneys.

18 thoughts on “Attorney Ethics: Disqualifying a Law Firm

  1. 18


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  2. 15

    Am I correct in understanding that K&S was disqualified because it did not have a conflict waiver on behalf of its current client, the party opposing the disqualification?

    So, even though the Plaintiff filed the motion to disqualify K&S, this case turned on protecting the interest of the Defendant, which opposed the motion?

    This doesn’t make sense to me.

  3. 13

    Thanks Joe, it was nothing – it was teed up already.

    “This reminds me of when Pennie and Edmonds…”

    Look what happened to the venerable BDSM (Burns Doane). Same thing.

  4. 12

    Askewsme, first they were with Outside-the-Box and then with Travel Caddy? Maybe they were thinking “outside the box”. (Get it? excuse me … Askewsem; Outside-the-Box … outside the box)

  5. 11

    This reminds me of when Pennie and Edmonds litigated to invalidate a patent they had prosecuted. They aren’t around anymore, ostensibly because certain key rainmakers left very shortly thereafter, leading to the firm’s collapse and most of the attorneys going to Jones Day. You have to wonder why they left, though?

  6. 8

    Perhaps King & Spalding thought that their client was not Outside-the-Box, but rather the attorneys on whose behalf they stated the fees were reasonable? I am not yet well-versed in conflict management software and its nuances, but I am pretty sure that if Outside-the-Box was never mentioned anywhere in a record, that conflict management software could not find it. GIGO.

  7. 7

    Ok, I understand, but still it seems very strange that a law firm would assist both the plaintiff and defendant for the SAME litigation in different roles (whether as an expert witness, counsel, serving coffee whatever).

    Spalding and King should have, obviously, sought a written waiver, and a smarter law firm should have said thanks but no thanks to the possible representation of Travel Caddy, in this case.

    As to the point of having Texas Rules apply, could 3.08(c) of the Texas Ethics Rules been used to knock out the representation of the attorney as well (if the issue of attorneys fees would/is a contest fact)?

  8. 5

    Because the fact that they did not disclose this to Plaintiff was the most straightforward route to excluding the firm. Defendant in fact raised the argument that their interests were affected by the selection of counsel, the Court just selected the applicable ethics rule and applied it. Since the firm didn’t even get a waiver from the Plaintiff, that was the quickest test that excluded them. Otherwise, they would have to determine whether Defendant was actually a client in terms of the rules in the expert witness events. They followed the wise rule of saying and determining the least amount possible.

  9. 3

    The same law firm was NOT representing both the plaintiff and the defendant. The law firm provided an expert witness for the defendant in the trial court, and is now attempting to represent the plaintiff on appeal. The opinion expressly declined to say that the law firm was representing the defendant when one of its lawyers served as an expert witness for the defendant.

    What’s strange is that the opinion decides the case on grounds that in order to represent the plaintiff on appeal, the lawyers on appeal will have to decide whether to attack the expert testimony of one of their own, and that the PLAINTIFF has not waived this potential conflict. Seems to me that if the plaintiff hired the lawyers for the appeal, then it may have implicitly waived this conflict…or at the very least may be willing to expressly waive the conflict. Why does the defendant have standing to raise this conflict?

  10. 2

    The same law firm is representing both the plaintiff and defendant? Can you even waive this type of conflict? Even if not, what the heck are these attorneys thinking? I think the Ethics board in Georgia and possibly the OED (if patent attorneys) will like to hear about this.

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