In re Ralph Roberts Realty, LLC, 500 B.R. 862

Roberts and Realty filed bankruptcy in 2012 and obtained a confirmed plan in 2013.
Roberts/Realty moved to disqualify Maddin Hauser from representing defendants in the Savoy AP.
Jacobs and Maddin Hauser previously represented Roberts/Realty; period of May 18, 2012 to November 2, 2012 was their former representation.
Savoy AP defendants filed notices of appearance by Maddin Hauser on December 20, 2012; Realty timely sued for disqualification.
Court found a current conflict under Rule 1.7(a) due to attorney-client relationship with Roberts beginning no later than November 8, 2012.
Court granted the motion and disqualified Maddin Hauser and its attorneys from representing any Savoy AP defendants.

Issue	Plaintiff's Argument	Defendant's Argument	Held
Whether Rule 1.9(a) disqualifies Maddin Hauser	Roberts/Realty contend former representation creates adverse matter.	Maddin Hauser argues not the same or substantially related matter.	No disqualification under Rule 1.9(a).
Whether Rule 1.9(c) prohibits use of information or disclosure	Rule 1.9(c) supports disqualification due to information	No evidence of improper use of information by Maddin Hauser	No basis for disqualification under Rule 1.9(c).
Whether 1.7(a) conflicts require disqualification	Roberts was a current client and Savoy AP creates direct adversity	No direct adversity after conflict could be consented to	Yes; Maddin Hauser disqualified under 1.7(a) and 1.10(a).

El Camino Res., Ltd. v. Huntington Nat’l Bank, 623 F.Supp.2d 863 (W.D. Mich. 2007) (federal courts look to state ethics rules for guidance)
Macomb Cnty. Taxpayers Ass’n v. L’Anse Creuse Pub. Sch., 564 N.W.2d 457 (Mich. 1997) (implied attorney-client relationship creates duties; not necessarily formal contract)
In re Visicon Shareholders Trust, 478 B.R. 292 (Bankr. S.D. Ohio 2012) (unauthorized fees may be disgorged; reliance on failure to obtain court approval not dispositive)