Around the Federal District Courts in the Northern District of California are the offices of many lawyers, litigators and patent attorneys. Even so, that Court continues to get motions to disqualify counsel based on client conflicts. Judge Schwarzer recently decided two such motions, in one case, against opposing counsel in Friskit, Inc. v. RealNetworks, Inc.
The case has a 2003 docket number, so it is not new to those listed on the docket. In early 2007, the president of Friskit meets with attorneys at Howrey, discloses confidences, and gets “advice and strategic ideas for Friskit’s case,” as he searches for “new counsel.” What got past everyone, briefly, was that Howrey was one of “two firms representing RealNetworks.” Also, Howrey was hiring RealNetworks in-house counsel, who had been actively working on the case. Friskit moved to disqualify Howrey, based on the president’s meeting. Judge Schwarzer denied that motion, but ordered an “ethical screen” between the case and the lawyers who had met with Friskit.
But wait, there’s more. In March 2007, the CEO, Board Chairman and majority owner of RealNetworks, Rob Glaser, had hired Foley in an unrelated litigation. Guess it? Foley represents Friskit in the case against RealNetworks. Glaser moved to disqualify Foley in the California case. Judge Schwarzer denied that motion, because Glaser was the “later-acquired client” of Foley, and their “duty of loyalty runs to the first client.”
Judge Schwarzer took the road most-traveled when disqualification motions are made – he steered past the matters. The bench tends to think that such motions are “often tactically motivated,” and it has little interest in enforcing the rules of professional conduct. It’s like roadkill, you just drive past it, thinking ‘yeeechh.’
The obvious oddity is how the chief executives of both litigants, in a case ongoing for years, would be unaware of what law firms represent the adverse party. Equally odd is how lawyers would be as unaware, and would meet and confer with the chief executive of a party adverse to their own client. Are there so few law firms in Silicon Valley, and do they not have high-tech systems for conflict checking?