Worley v. Moore, 370 N.C. 358

Plaintiffs are former Consert shareholders who sued Toshiba and former Consert insiders alleging a collusive merger scheme that deprived shareholders of earn-out payments. Joseph Forbes is one of the plaintiffs and a former Consert officer.
During related Itron litigation (pre-merger disputes and patent issues), Kilpatrick Townsend (Bush) represented Consert and, by limited engagement letter, separately provided limited discovery/deposition representation to Forbes; that letter authorized Bush to disclose information to Consert and related entities and stated the representation was limited in scope.
Forbes was concurrently represented by Winston & Strawn for broader matters; Winston negotiated the limited engagement and attended part of Forbes’s deposition preparation; Forbes produced documents in the Itron litigation and gave deposition testimony.
After the Itron litigation settled and plaintiffs later filed the present suit, defendants retained Bush/Kilpatrick to represent them. Forbes moved to disqualify Bush under Rule 1.9(a), alleging prior confidential communications would be used against him.
The trial court found a prior attorney–client relationship and material adversity, relied on Forbes’s declaration and his subjective perception of confidences, applied the displaced “appearance of impropriety” standard, and disqualified Bush/Kilpatrick. Defendants appealed.

Issue	Plaintiff's Argument	Defendant's Argument	Held
Whether counsel should be disqualified under Rule 1.9(a) for former-client conflict	Forbes: Bush previously represented me; confidences were exchanged that could be used against me now, so disqualification is required	Bush: engagement limited and authorized disclosure to Consert; concurrent counsel and scope show no confidential info was protected for Forbes against Consert; objective substantial-relationship test not met	Reversed. Trial court applied wrong standard and relied on Forbes’s subjective perception and appearance-of-impropriety; remand to apply objective Rule 1.9(a) test
Whether the matters are "substantially related" so confidential info would be material to current suit	Forbes: overlapping subject matter (patent, merger, 220 action) makes the matters substantially related	Defendants: engagement letter limited scope; concurrent counsel and nature of services make sharing of protected confidences unlikely	Court: Trial court must objectively assess scope, nature of services, engagement letter, time spent, and factual overlap on remand — not decide on plaintiff’s subjective belief
Whether "appearance of impropriety" justifies disqualification	Forbes relied in part on appearance concerns	Defendants: appearance standard is obsolete and not part of current Rule 1.9 analysis	Held: Appearance-of-impropriety is no longer a valid basis for disqualification; trial court erred by applying it

Travco Hotels, Inc. v. Piedmont Nat. Gas Co., 332 N.C. 288 (N.C. 1992) (trial-court discretion on disqualification decisions)
Plant Genetic Sys., N.V. v. Ciba Seeds, 933 F. Supp. 514 (M.D.N.C. 1996) (articulating reasonable-probability/confidentiality test for disqualification)
Gov’t of India v. Cook Indus., 569 F.2d 737 (2d Cir. 1978) (requiring high standard of proof to disqualify former counsel)
Cooter & Gell v. Hartmarx Corp., 496 U.S. 384 (U.S. 1990) (abuse of discretion where court misstates law)
Nix v. Whiteside, 475 U.S. 157 (U.S. 1986) (reliance on Rules commentary in interpreting professional conduct rules)
Allegaert v. Perot, 565 F.2d 246 (2d Cir. 1977) (disqualification requires reasonable expectation that attorney received protectable confidences)
Raymond v. N.C. Police Benevolent Ass’n, 365 N.C. 94 (N.C. 2011) (formation of attorney-client relationship requires confidential legal-advice communications)