In Re Blue Cross Blue Shield Antitrust Litigation MDL 2406
2:13-cv-20000
| N.D. Ala. | Feb 26, 2025Background
- Attorneys from Maynard Cooper & Gale, who represented Blue Cross and Blue Shield of Alabama (BCBS-AL) for a decade in a major antitrust MDL, moved to Polsinelli PC in January 2024.
- Polsinelli is a large firm that represents many healthcare providers and has actively participated in the Blue Cross Blue Shield antitrust MDL, including representing providers and attending mediation regarding settlement.
- Polsinelli attorney Dan Owen, heavily involved for years on the Provider Plaintiffs' side, advised providers about opting out of the pending settlement, and made negative public comments about the settlement deal.
- BCBS-AL objected, citing ethical conflicts due to Polsinelli hiring former Maynard attorneys who had confidential information from years of direct work for BCBS-AL in the same litigation.
- The Plaintiffs filed a motion to disqualify Polsinelli from advising any providers on the opt-out issue and requested that a corrective notice be sent due to allegedly misleading statements made by Polsinelli's Owen.
- The court held a hearing, considered whether Alabama’s strict conflict imputation (with no ethical screen exception) applied, and ruled on the motion.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether Polsinelli should be disqualified due to conflicts after hiring BCBS-AL’s lawyers | Conflict exists; Alabama law doesn't permit screening to cure conflict | Screening is sufficient under other states' rules, not in Alabama | Polsinelli (and Owen) are disqualified from advising on opt-out or taking positions adverse to BCBS-AL |
| Does Alabama Rule 1.9 (former client conflict) apply to Polsinelli’s actions? | Yes; advice on opt-outs is within the same/similar matter in Alabama | No; client counseled is not in AL, and no suit against BCBS-AL | Alabama Rule 1.9 applies, given the scope of the MDL and the advice’s connection to the court’s settlement |
| Is an ethical screen sufficient to avoid imputation of conflict under Alabama rules? | No, not permitted under Alabama’s version of Rule 1.10 | Cited other states allowing screening | Alabama does not permit screening in this context, so conflict is imputed across firm |
| Should a corrective notice be required due to misleading statements to class members? | Yes; Owen’s statements were misleading and may harm the class | No; presentation stated personal opinion, not misleading | No corrective notice ordered, but court encourages continued Provider Counsel outreach |
Key Cases Cited
- In re BellSouth Corp., 334 F.3d 941 (11th Cir. 2003) (disqualification requires compelling reasons, and burden is on moving party)
- Herrmann v. GutterGuard, Inc., 199 F. App’x 745 (11th Cir. 2006) (court must identify specific rule violated before disqualifying counsel)
- Banque de Rive, S.A. v. Highland Beach Dev. Corp., 758 F.2d 559 (11th Cir. 1985) (disqualification appropriate if representation would violate professional rules)
- Schlumberger Techs., Inc. v. Wiley, 113 F.3d 1553 (11th Cir. 1997) (court must clearly identify rule and ethical violation for disqualification)