Ethical wall was not adequate to prevent attorney disqualification
Intellectual Ventures I LLC (redacted) v. Checkpoint Software Technologies LTD, et al., Civ. No. 10-1067-LPS, June 22, 2011.
Stark, J. Motion to disqualify defense counsel is granted.
Plaintiff, Intellectual Ventures I LLC (“IV”), initiated this patent infringement case involving computer virus technology on December 8, 2010 against defendants, Check Point Software Technologies Inc., Check Point Software Technologies Ltd., McAfee Inc., Symantec Corp., Trend Micro Inc. (USA), Trend Micro Incorporated. The Check Point defendants retained Wilson Sonsini Goodrich and Rosati, PC as defense counsel (“WSGR”). On January 31, 2011, the Check Point defendants answered and filed counterclaims against plaintiff. On March 8, 2011, they moved to transfer the case to California, which was denied. On April 6, 2011, plaintiff moved to disqualify WSGR asserting, inter alia, WSGR’s representation of IV from 2002 to 2009 as the basis for the motion (“Motion to Disqualify”). Oral argument was held on the Motion to Disqualify on May 16, 2011. By Memorandum Opinion dated June 30, 2011, the Motion to Disqualify was granted. The primary issue before the Court was whether under Model Rule of Professional Conduct 1.9, WSGR’s prior attorney client-relationship with IV “is fairly characterized as ‘substantially related’” to the currently materially adverse litigation involving IV and the Check Point defendants. Further, if so, whether “WSGR’s ‘ethical wall’ is sufficient to avoid imputing the conflict arising from the former representation to the entire WSGR firm, or whether, on balance, the equities disfavor disqualification.” Here, WSGR’s prior representation of IV was found to be “substantially related” to the instant litigation because, inter alia, “WSGR was involved intimately in every aspect of IV’s formation, patent licensing practices, negotiation of patent licenses, strategies for potential patent litigation, and ways of mitigating the risk of patent litigation[.]” WSGR’s ethical wall, established before any work began on behalf of the Check Point defendants, as inadequate to prevent disqualification given the nexus between the current litigation and former representation. The equities also did not weigh against disqualification.
