814 F.3d 1046
9th Cir.2016Background
- Reading International sued The Malulani Group (TMG) in federal court alleging TMG breached settlement documents from a 2009 Hawaii state-court action (the Prior Action).
- Kenneth Robbins previously represented TMG in the Prior Action while at Robbins & Associates; Robbins and his associate participated in mediation that produced the broadly agreed settlement terms placed on the record March 11, 2009.
- Robbins & Associates withdrew as TMG’s counsel effective March 17, 2009; final settlement papers were executed July 2, 2009 and publicly filed.
- Robbins joined Bronster Fujichaku Robbins (the Bronster Firm), Reading’s counsel, in March 2015; the firm notified TMG on Feb 20, 2015 and proposed screening and requested TMG’s written consent under HRPC 1.9/1.10; TMG did not consent.
- TMG moved to disqualify the Bronster Firm on the ground Robbins’ prior representation created a conflict under Hawaii’s “substantial relationship” test (HRPC 1.9), and that the conflict should be imputed to the firm under HRPC 1.10(c).
- The Ninth Circuit granted the motion: it held Robbins had confidential information substantially related to the present matter, imputation via HRPC 1.10(c) could not be invoked because Robbins possessed confidential information, and the Bronster Firm was disqualified; Reading must obtain new counsel and the reply brief filed after Robbins joined was struck.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether Robbins’ prior representation of TMG in the Prior Action bars him from representing Reading under HRPC 1.9 (substantial-relationship test) | Robbins did not participate in drafting or executing the final settlement documents; his firm was terminated before the final settlement; the present suit concerns post-settlement performance of publicly filed documents, so matters are not substantially related | Robbins participated in mediation and had confidential communications about settlement strategy; issues of party intent in the settlement overlap with the prior matter, creating substantial risk that confidential info could materially advance Reading’s position | Held: Representations are substantially related; Robbins is personally disqualified under HRPC 1.9 |
| Whether Robbins’ disqualification is imputed to the Bronster Firm under HRPC 1.10(c) (screening exception) | The firm satisfied HRPC 1.10(c): Robbins was screened, received no fees, and notice was given — so imputation is avoided | Robbins participated in the Prior Action and therefore has confidential information; HRPC 1.10(c)(1) requires the personally disqualified lawyer have no confidential information regarding the matter, which is not met here | Held: HRPC 1.10(c)(1) not satisfied because Robbins has confidential information; disqualification is imputed to the Bronster Firm |
| Whether TMG waived the right to seek disqualification by delaying its motion | Reading argues TMG knew of Robbins’ association months before moving and therefore waived the right | TMG did not consent when requested and moved within a reasonable interval after filings showing Robbins’ association; no waiver shown | Held: No waiver; motion timely and not forfeited |
| Whether the court should strike filings made after the conflict arose and require new counsel | Reading sought to keep existing filings and proceed with same counsel except Robbins | TMG sought disqualification and striking of reply brief filed after Robbins joined | Held: Bronster Firm disqualified; Reading must obtain new counsel within 35 days; reply brief filed after conflict struck and Reading may file a substitute after new counsel appears |
Key Cases Cited
- In re County of Los Angeles, 223 F.3d 990 (9th Cir. 2000) (federal courts apply state law on disqualification and caution that disqualification motions warrant strict scrutiny)
- Otaka v. Klein, 71 Haw. 376 (Haw. 1980) (Hawaii adopted the substantial-relationship test for disqualification)
- Optyl Eyewear Fashion Int'l Corp. v. Style Cos., 760 F.2d 1045 (9th Cir. 1985) (motions to disqualify are drastic and subject to close judicial scrutiny)
- In re Highley, 459 F.2d 554 (9th Cir. 1972) (a corporation must be represented by counsel)