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Arista Records LLC; Atlantic Recording Corporation; Arista Music, Fka v. Lime Group LLC; Lime Wire LLC; Mark Gorton; Greg Bildson; and M.J.G.

February 22, 2011

ARISTA RECORDS LLC; ATLANTIC RECORDING CORPORATION; ARISTA MUSIC, FKA BMG MUSIC; CAPITOL RECORDS, INC; ELEKTRA ENTERTAINMENT GROUP INC; INTERSCOPE RECORDS; LAFACE RECORDS LLC; MOTOWN RECORD COMPANY, L.P.; PRIORITY RECORDS LLC; SONY MUSIC ENTERTAINMENT, FKA SONY BMG MUSIC ENTERTAINMENT; UMG RECORDINGS, INC; VIRGIN RECORDS AMERICA, INC.; AND WARNER BROS. RECORDS INC., PLAINTIFFS,
v.
LIME GROUP LLC; LIME WIRE LLC; MARK GORTON; GREG BILDSON; AND M.J.G. LIME WIRE FAMILY LIMITED PARTNERSHIP, DEFENDANTS.



The opinion of the court was delivered by: Kimba M. Wood, U.S.D.J.

OPINION & ORDER

Plaintiffs move to disqualify Willkie, Farr & Gallagher LLP ("Willkie") from representing Defendants in the above-captioned matter (hereinafter the "LimeWire Matter"). Plaintiffs base their motion on the fact that Jeffrey Korn, now a partner at Willkie, was previously an associate at Cravath, Swaine & Moore, LLP ("Cravath"), where he served as the senior associate on Cravath's representation of Plaintiffs in the LimeWire matter.*fn1 Because the Court finds that the conflict does not pose a significant risk of trial taint, the Court DENIES Plaintiffs' motion.

I. Factual Background

A. 2006-2007: Korn's Transition from Cravath to Willkie In August 2006, Plaintiffs, represented by Cravath, filed a lawsuit against Defendants. During the active litigation period between November 2006 and August 2007, Korn, in his own words, was "the senior associate on the Lime Wire case." (Klaus Decl. ("KD") Ex. D at 88:11-12.) It is undisputed that Korn gained access to confidential information relating to the LimeWire matter during his time at Cravath.*fn2 (See Def. Opp. at 5 ("Defendants do not dispute that Korn had access to confidential information when he worked at Cravath.")

In September 2007, Korn joined Willkie as an associate. (KD Ex. G.) Korn took no documents concerning the LimeWire case with him from Cravath. (Netzer Decl. Ex. 1 at 94:25-95:9.) When Korn began working at Willkie, he listed over forty matters on a conflict sheet, including the LimeWire matter. (KD Ex. G.) Willkie did not enter Korn's LimeWire conflict into its conflicts database. (KD. Ex. E at 35:4-36:11.) Korn testified that, after joining Willkie, he had lunch with the Cravath partner in charge of the LimeWire matter on two occasions. (KD Ex. D at 54:17-55:16.) Korn testified that, although they discussed the status of the LimeWire litigation, they did not discuss anything substantive about the case. (KD Ex. D at 55:5-56:4.)

B. October 2008: Willkie Approached to Represent Defendants in the LimeWire Matter

On October 8, 2008, William Ried, a lawyer at Willkie, circulated an email, stating, "we have been asked to represent [the LimeWire Defendants] in defending copyright litigation brought by [Plaintiffs]." (KD Ex. I, at 2.) Another lawyer replied to Ried, stating, "Jeff Korn had a significant relationship with a Lime Wire litigation," and copied Korn on the email. (Id.) Korn then responded to the email, stating:

Cravath represents the record companies in this litigation. Before I left Cravath in September 2007, I spent almost a year as the senior associate on this case. Charles Baker and Joe Cohen (current counsel to Lime Wire) will remember me. Strange timing -- I was just discussing the case last night with Katherine Forrest [Cravath partner on the matter]. (KD Ex. H, at 1.) Korn testified that he could not recall anything about the episode beyond his own email. (KD Ex. D at 63:9-64:2.) Following the receipt of Korn's email, Willkie still did enter Korn's LimeWire conflict into its conflicts database. (KD Ex. E at 55:17-56:16.) Ried forwarded Korn's email to Francis Menton, chair of Willkie's "Conflicts and Ethics Committee." Ried and Menton exchanged a series of emails that have been redacted based on claims of privilege and work product. (KD Ex. I.) Willkie did not undertake the representation of the Limewire Defendants in 2008.*fn3

C. May-July 2010: Willkie Represents Tower in the LimeWire Matter

In late May 2010, after the Court issued its summary judgment ruling finding Defendants liable for secondary copyright infringement, Sandy Choi, General Counsel to Tower Research Capital ("Tower"),*fn4 contacted Tariq Mundiya, a partner at Willkie, about representing Tower in the "Limewire Litigation."*fn5 (KD Ex. F at 11:12-13:23; Ex O; Ex. R.) Tower was concerned about how Plaintiffs' motion to freeze assets, filed against the LimeWire Defendants, would impact Tower. (KD Ex. F. at 21:10-22:18.) In early June 2010, Willkie undertook the representation of Tower in relation to the LimeWire Matter (hereinafter the "Tower/ LimeWire Matter").*fn6 Mundiya testified that, in early June 2010, he told Korn "that [he] . was monitoring litigation involving an intellectual property dispute concerning Lime Wire." (KD Ex. F at 17:6-10.) Korn testified that he then told Mundiya that he was the senior associate on the LimeWire case during his time at Cravath. (KD Ex. D at 88:11-13.) Korn testified that he discussed with Mundiya at a "high level of generality" the nature of the work he did on the case, specifically, that he was involved in the formulation of the fraudulent conveyance and antitrust claims. (KD Ex. D at 88:14-24; KD Ex. F at 17:22-18:5.) Mundiya and Korn then agreed not to discuss the matter further, and Mundiya instructed Korn not to share confidential information about the LimeWire case with anyone at Willkie. (Korn Decl. ¶ 22; Mundiya Decl. ¶¶ 7-8; 11.)

Mundiya testified that, in early June 2010, he also "informed [associate] Todd Cosenza who was really the only principal person working on the [Tower] matter with [him] that he shouldn't talk to Jeff Korn." (KD Ex. F at 32:7-14; 33:7-10.) On June 18, 2010, Willkie submitted a new matter form for the Tower/ LimeWire Matter. (KD Ex. R.) The form has a box asking whether there are any conflict concerns. Notwithstanding that the firm was aware of a Korn's LimeWire conflict, the box is checked "no." (Id.)

On July 1, 2010, one month after being approached by Tower about the Tower/LimeWire matter, Willkie circulated an internal firm-wide email asking attorneys to comment on possible conflicts related to the Tower/ LimeWire Matter. (KD Ex. U at 7.) Korn responded, stating that, "[a]s [I] mentioned to Tariq Mundiya, I previously represented Plaintiffs in the Limewire litigation." (Id. at 1.) In response, Mundiya wrote, "we will have to have a wall placed so that Mr. Korn is not involved in the matter." (Id.)

On July 21, 2010, almost three weeks later (and approximately seven weeks after being approached about the Tower/LimeWire Matter), Willkie's records manager sent Mundiya an email stating: "Just a reminder that I'm expecting a memo from you to wall off Jeff Korn (I believe) from a client/matter (possibly Tower), but I haven't gotten it yet." (KD Dec. Ex. S.) Mundiya responded, asking that Korn be blocked from "all matters" for Tower. (Id.) The next day, Willkie implemented an electronic wall and a screen of hard copy documents to block Korn's access to ...

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