United States District Court, Eastern District of New York
February 28, 1991
ALLAN BAIRD AND LENORE BAIRD, PLAINTIFFS,
HILTON HOTEL CORPORATION AND PALMER HOUSE COMPANY, DEFENDANTS.
The opinion of the court was delivered by: Amon, District Judge.
MEMORANDUM AND ORDER
By Order to Show Cause dated December 14, 1990, defendants
moved for an order disqualifying plaintiffs' counsel on the
ground that an attorney who was previously associated with
defendants' former counsel Bivona & Cohen (the Bivona firm) and
who represented the defendants in the discovery phase of this
case, is now employed by plaintiffs' law firm, Katz, Katz &
Bleifer, P.C. (the Katz firm).
For the reasons set forth below, defendants' motion is
The facts surrounding this motion generally are not disputed.
Candice Pluchino personally participated in the defense of this
matter on behalf of defendants while employed by the Bivona
firm, including the drafting of discovery responses and
appearances at the depositions of both plaintiff Allan Baird
and an employee of defendant Hilton Hotel Corporation on
November 11, 1988 and January 25, 1989, respectively. Ms.
Pluchino was subsequently employed by the Katz firm in
September 1989. The Katz firm was a seven-member law firm when
Ms. Pluchino was hired and presently consists of nine
On April 30, 1990, defendants' present attorneys, Kanterman,
Taub & Breitner (the Kanterman firm) were substituted for the
On December 12, 1990, five days before the jury was to be
selected for trial, Glen Pewarski of the Kanterman firm noticed
Ms. Pluchino's name on the letterhead of the Katz firm and
connected her name with the name appearing on the deposition
transcripts. On December 14, 1990, defendants moved by order to
show cause to disqualify plaintiffs' counsel.
On December 17, 1990, the court heard argument on the motion
and testimony from Ms. Pluchino. Ms. Pluchino conceded her
direct involvement in the case on behalf of the defendants
while at the Bivona firm. She testified, however, that she has
had no dealings with the instant action while at the Katz firm.
She stated that the lawyers at her firm who were representing
plaintiffs were aware of her previous representation of
defendants and did not discuss the case with her. She
additionally noted that
precautions had been taken to insure that she had no access to
files and correspondence pertaining to the case. Ms. Pluchino
testified that she believed that the Bivona firm had been aware
of her employment by plaintiffs' firm since approximately
November 1989 and had never objected.
Based on Ms. Pluchino's testimony and plaintiffs' argument
that disqualification was barred by laches, I directed
defendants to contact the Bivona firm concerning its knowledge
of Ms. Pluchino's change of firms. Although the attorney who
supervised the case at the Bivona firm declined to supply
defendants with an affidavit, he did inform defendants that he
learned of Ms. Pluchino's employment with the Katz firm
sometime after she left the Bivona firm in August 1989. He
further informed defendants that the Katz firm never formally
notified him of Ms. Pluchino's employment at that firm.
It is not disputed that Ms. Pluchino is disqualified from
representing plaintiffs in this case. Defendants were clients
of Ms. Pluchino when she was employed at the Bivona firm, the
subject matter of the prior representation and the issues in
the present lawsuit are identical, and Ms. Pluchino, having
taken key depositions in this case while at the Bivona firm,
was likely to have had access to relevant privileged
information while representing defendants. See Evans v. Artek
Sys. Corp., 715 F.2d 788, 791 (2d Cir. 1983); United States
Football League v. Nat'l Football League, 605 F. Supp. 1448,
1452 (S.D.N.Y. 1985).
What is disputed is (1) whether Ms. Pluchino's
disqualification requires disqualification of the entire Katz
firm and (2) if so, whether defendants' motion to disqualify is
barred by laches.
A. Disqualification of the Katz Firm
Although the rules of professional conduct are not
dispositive, courts should look to these rules for guidance in
determining disqualification motions. E.g., Fund of Funds, Ltd.
v. Arthur Andersen & Co., 567 F.2d 225, 227 n. 2 (2d Cir.
1977). Disciplinary Rule (DR) 5-105(D) provides:
If a lawyer is required to decline employment or
to withdraw from employment under a Disciplinary
Rule, no partner, or associate, or any other
lawyer affiliated with him or his firm, may accept
or continue such employment.
Despite the clear direction of DR 5-105(D) that an attorney's
disqualification bars the entire firm, plaintiffs contend that
the "Chinese Wall" that is in place at the Katz firm to screen
Ms. Pluchino from information about the case is sufficient to
preclude the disqualification of the firm.
In Cheng v. GAF Corp., 631 F.2d 1052 (2d Cir. 1980) vacated
on other grounds, 450 U.S. 903, 101 S.Ct. 1338, 67 L.Ed.2d 327
(1981),*fn1 the court addressed the effectiveness of the
"Chinese Wall" in place in that case and found it deficient.
The plaintiff in Cheng moved to disqualify defendants' law firm
because one of the firm's attorneys had previously worked at
the same Legal Services Office representing the plaintiff and
had discussed plaintiff's case with the staff members directly
responsible for the matter. In opposing the motion, the
defendants explained that the attorney had been assigned to a
division in defendant's firm different from the one handling
the litigation, that he had neither worked on nor
discussed the case at the firm, and that the firm would not
permit him to have any substantive involvement in the case. 631
F.2d at 1057. While accepting the defendant's account of the
precautions taken, the court noted that one of the important
purposes of disqualification was to "to guard against the
danger of inadvertent use of confidential information."
Id. (quoting Ceramco, Inc. v. Lee Pharmaceuticals,
510 F.2d 268, 271 (2d Cir. 1975), as quoted in Silver Chrysler Plymouth
Inc. v. Chrysler Motors Corp., 518 F.2d 751, 754 (2d Cir.
1975)). Given the relatively small size of the firm (35 overall
and 21 in the New York office where the attorney was located)
and the circumstance that the firm was still actively pursuing
the litigation, the court did not believe that the screening
mechanisms in place could safeguard against inadvertent
disclosures for the duration of the representation. Id. 631
F.2d at 1058; see also United States Football League, 605
F. Supp. at 1467-68.
The court further observed that although its decision rested
on the clear direction of Disciplinary Rule 5-105(D), the case
also presented an unacceptable appearance of impropriety.
Recognizing that in Bd. of Educ. v. Nyquist, 590 F.2d 1241 (2d
Cir. 1979), it had noted that where there is no danger that the
underlying trial will be tainted, the appearance of impropriety
alone would not justify disqualification, the court in Cheng
found that despite attempts to screen the attorney, it was
still possible that the underlying trial would be tainted by
the defendant's inadvertent use of the unfair advantage it had
over the plaintiff. Cheng, 631 F.2d at 1059. Accordingly, the
Cheng court held that the case presented both the danger of
tainting the underlying trial and the unacceptable appearance
of impropriety condemned in Canon 9. Id. In concluding that the
entire firm should be disqualified under Canons 9, 4 and 5, the
court noted that "if there were any doubt as to the propriety
of our action, we would resolve it in favor of
disqualification." Id.; see also Hull v. Celanese Corp.,
513 F.2d 568, 571 (2d Cir. 1975); Papanicolaou v. Chase Manhattan
Bank, N.A., 720 F. Supp. 1080, 1083 (S.D.N.Y. 1989).
The facts here present an even more compelling case for
disqualification than those in Cheng. First, Ms. Pluchino was
directly involved with the representation of defendants at the
Bivona firm while the attorney in the Cheng case did not
personally represent the plaintiff but only participated in
discussions with other attorneys about the case. Second, in
terms of the potential effectiveness of any "Chinese Wall," Ms.
Pluchino's firm is smaller than the firm in the Cheng case and
the measures taken to insulate her are no more stringent.
Moreover, as in Cheng, this case is ongoing and accordingly the
danger of disclosure continues. Although I do not doubt the
veracity of Ms. Pluchino's statements that she has not
disclosed confidential information to her new colleagues, I
find that in her daily contacts with plaintiffs' counsel there
remains a danger of inadvertent disclosure of information she
gained while representing the defendants. The obvious
appearance of impropriety coupled with a real danger that the
forthcoming trial will be tainted require disqualification. See
Cheng, 631 F.2d at 1057-59; Yaretsky v. Blum, 525 F. Supp. 24,
29-30 (S.D.N.Y. 1981).
In sum, the reasoning of Cheng is persuasive, and plaintiffs
have cited no case in this circuit that, under similar
circumstances, has held otherwise.*fn2 The analysis in Cheng
dictates disqualification in this case.
Accordingly, defendants have established that the Katz firm
should be disqualified from representing plaintiffs in this
Plaintiffs nonetheless contend that disqualification is not
appropriate in this
case because defendants' predecessor counsel became aware,
albeit informally, of Ms. Pluchino's employment with the Katz
firm in approximately November 1989 and failed to object.
In this circuit, laches is generally not a defense to a
motion to disqualify. See, e.g., Gov't of India v. Cook Indus.,
Inc., 422 F. Supp. 1057, 1059 n. 4 (S.D.N.Y. 1976). In Emle
Indus., Inc. v. Patentex, Inc., 478 F.2d 562 (2d Cir. 1973),
the court, in determining that laches did not bar a motion to
disqualify opposing counsel, held that the public interest that
was served by disqualification in that case and the court's
duty and power to regulate the conduct of attorneys practicing
before it in accordance with the rules of professional conduct
could not be defeated by the laches of a private party. 478
F.2d at 574.
In this case, the public interest in avoiding the appearance
of impropriety in such situations, see Cheng, 631 F.2d at 1059;
Yaretsky, 525 F. Supp. at 30, is sufficient to preclude the
application of laches to bar defendants' motion. Emle, 478 F.2d
at 574. Moreover, although undoubtedly a plaintiff suffers some
prejudice whenever his counsel is disqualified on the eve of
trial, the prejudice has been, to a great extent, the result of
the failure of the Katz firm to formally notify defendants of
the potential conflict. Had this been done, the Kanterman firm,
based on a review of the files obtained from the Bivona firm
would have been in a position to move for disqualification
shortly after it was substituted for the Bivona firm on April
30, 1990, and prejudice due to the closeness of the trial of
this matter would not have been an issue.
In sum, although application of the laches doctrine might be
appropriate in an extraordinary case where it is clear that the
disqualification motion was inspired by dilatory tactics,
see, e.g., United States v. Newman, 534 F. Supp. 1113, 1127
(S.D.N.Y. 1982), that is not the situation here.
For the foregoing reasons, defendants' motion is granted and
Katz, Katz & Bleifer, P.C. is disqualified from further
representation of plaintiffs in this case.
It is further ordered that:
(1) plaintiffs have until March 29, 1991 to secure new
counsel and notify the court accordingly;
(2) the parties are to appear at a status conference on April
5, 1991 at 10:30 A.M. the purpose of rescheduling the trial of