1 Plaintiff Reply to Disqualify Def Counsel

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REPLY ISO PLAINTIFF’S MOTION TO DISQUALIFY DEFENDANTS’ COUNSEL

LEE TRAN & LIANG APLC K. Luan Tran (SBN 193808) James M. Lee (SBN 192301) Cyrus Khojandpour (SBN 260233) Lisa J. Chin (SBN 259793) 601 S. Figueroa Street, Suite 3900 Los Angeles, CA 90017 Tel. 213-612-3737 / Fax. 213-612-3773 RAY A. MANDLEKAR, ATTORNEY AT LAW Ray A. Mandlekar (SBN 196797) 601 S. Figueroa Street, Suite 4050 Los Angeles, CA 90017 Tel. 213-785-6130 / Fax. 213-254-9001 Attorneys for Plaintiff Frank Reginald Brown, IV

SUPERIOR COURT OF THE STATE OF CALIFORNIA

FOR THE COUNTY OF LOS ANGELES

FRANK REGINALD BROWN, IV,

Plaintiff,

v. SNAPCHAT, INC., a Delaware corporation; TOYOPA GROUP, LLC, a California Limited Liability Company; EVAN THOMAS SPIEGEL, an individual; ROBERT CORNELIUS MURPHY, an individual; and DOES 1 through 10 inclusive,

Defendants.

CASE NO: BC501483 Assigned for all purposes to the Honorable John L. Segal (Dept. 50) PLAINTIFF’S REPLY IN SUPPORT OF HIS MOTION TO DISQUALIFY DEFENDANTS’ COUNSEL QUINN EMANUEL URQUHART & SULLIVAN LLP [Defendants’ Objections to Declarations of Joseph C. Sarles and Robert Kehr, Response to Defendants’ Objections, and Request for Judicial Notice Filed Concurrently herewtih] Hearing: Date: August 1, 2013 Time: 8:30 a.m. Dept.: 50 Action Filed: February 21, 2013 Trial Date: Not Assigned Yet

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INTRODUCTION

The most notable feature of Defendants’ Opposition is that Defendants are unable to cite one

single case where a court permitted a law firm to do what Quinn Emanuel is attempting to do here:

Obtain confidential information from a client about prospective litigation and then switch sides to

oppose that same client in the same litigation, pursuant to a supposed advance waiver of conflict form.

No court has allowed a law firm to do this. This Court should not endeavor to be the first.

In a recent motion to disqualify that it filed in another matter, Quinn Emanuel called the

concept of successively working on both sides of a case “the cardinal sin under the disqualification

cases,” and obtained disqualification of the opposing firm by urging the court that “[n]o amount of

spin and no ethical wall can change the fact that disqualification” is required. See Request for Judicial

Notice (“RJN”), Exh. B at 1:3-8. The same standard—and result—should apply here.

Indeed, Defendants do not dispute that Quinn Emanuel attorney Anthony Alden is conflicted

(hence the attempt to isolate him with an ethical wall). Case law, applying the established vicarious

disqualification rule, is clear that this conflict is imputed to the entire Quinn Emanuel firm. Case law

is also clear that no ethical wall can save a side-switching firm from disqualification.

The supposed conflict waiver Quinn Emanuel required Plaintiff to sign also does not prevent

disqualification, as that supposed waiver is invalid under the factors set forth in Visa U.S.A., Inc. v.

First Data Corp., 241 F. Supp. 2d 1100, 1105 (N.D. Cal. 2003). Most notably, when Mr. Alden

purported to explain in an email the import of that waiver to Plaintiff, he specifically did not mention

that it would ostensibly permit Quinn Emanuel to represent the same adverse parties in the very same

matter he and Plaintiff were discussing. This alone is fatal to Defendants’ waiver argument.

Defendants – who replaced their previous counsel to knowingly retain a law firm Plaintiff had

consulted about this same case – now argue they are entitled to counsel of their choice. But “[t]he

paramount concern must be to preserve public trust in the scrupulous administration of justice and the

integrity of the bar [and] the important right to counsel of one’s choice must yield to ethical

considerations that affect the fundamental principles of our judicial process.” People ex rel. Dept. of

Corp. v. SpeeDee Oil Change Systems, Inc., 20 Cal. 4th 1135, 1145 (1999). This means that there are

limits to a Defendants’ choice of counsel, and this Court should enforce those limits.

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ARGUMENT

I. QUINN EMANUEL SWITCHED SIDES IN THE SAME CASE

Defendants know that side-switching in the same case is “[t]he most egregious conflict of

interest” mandating automatic disqualification. SpeeDee Oil, 20 Cal. 4th at 1146. As a result,

Defendants hired Robert Kehr, a “distinguished ethics expert,” to issue the incredulous opinion that

Quinn Emanuel cannot be disqualified because no side-switching had occurred due to the fact that it

had declined to represent Plaintiff. Kehr Dec. at 2.

At the outset, Mr. Kehr’s entire declaration is inadmissible because it seeks to offer improper

legal opinions. See Plaintiff’s Objections to Kehr Decl. In another case, Quinn Emanuel attacked Mr.

Kehr for offering the same type of inadmissible opinion: “Mr. Kehr has been reprimanded by courts

in the past for these exact types of impermissible opinions. A Westlaw search for opinions in which

his testimony has been offered shows that the only two opinions addressing Mr. Kehr’s expert opinion

excluded it as offering improper legal conclusions […] The Court should do so here as well.” RJN,

Exh. A at 3:2-5. Mr. Kehr’s declaration should suffer the same fate urged by Quinn Emanuel.

Regardless, Mr. Kehr is absolutely wrong. Courts have consistently held that an attorney who

received confidential information may still be disqualified even if no formal attorney-client

relationship had formed or engagement had resulted. See Morrison Knudsen Corp. v. Hancock,

Rothert & Bunshofts, 69 Cal. App. 4th 223, 232-33 (1999) (“an attorney’s receipt of confidential

information from a non-client may lead to the attorney’s disqualification”); SpeeDee Oil, 20 Cal.4th at

1147-48 (“fiduciary relationship existing between a lawyer and client extends to preliminary

consultations by a prospective client with a view to retention of the lawyer, although actual

employment does not result”); Li v. A Perfect Day Franchise, Inc., 2011 WL 4635176 at *2-5 (N.D.

Cal.) (attorney disqualified from “substantially related” matter after previously had a 30-90 minute

“preliminary conversation that did not result in professional employment or services”).

In another successful motion to disqualify, Quinn Emanuel cited to applicable case law and

correctly described the McKool Smith firm as having engaged “in a classic and clearly impermissible

case of switching sides” due to a previous 45-minute telephone conversation between Quinn

Emanuel’s client and McKool Smith on the same matter that did not result in a formal retention. RJN,

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Exh. E at 14.1 McKool Smith then withdrew from the case. RJN, Exh. F. In sum, Quinn Emanuel

clearly engaged in side-switching here although Plaintiff never formally hired it.

II. DUE TO MR. ALDEN’S UNDISPUTED CONFLICT, THE ENTIRE QUINN EMANUEL FIRM MUST BE VICARIOUSLY DISQUALIFIED AS WELL

A. Defendants Do Not Dispute That Mr. Alden Is Conflicted

Defendants do not dispute California courts apply a “substantial relationship” test to determine

whether an attorney should be disqualified in a successive representation. See Flatt v. Superior Court,

9 Cal. 4th 275, 283 (1994) (“[w]here the requisite substantial relationship between the subjects of the

prior and the current representations can be demonstrated, access to confidential information by the

attorney in the course of the first representation (relevant, by definition, to the second representation)

is presumed and disqualification of the attorney’s representation of the second client is mandatory”).

Defendants also do not dispute that under this test, Mr. Alden is disqualified from representing

Defendants in this matter because Plaintiff previously consulted him on the same matter. It is noted

that while Defendants are not disputing that Mr. Alden has an incurable conflict, they submit a

declaration from Mr. Alden essentially denying what he discussed with Plaintiff. But this Court need

not get into a “swearing contest” regarding what was discussed: “Courts have long been concerned about the prospect of a swearing contest between the attorney and former client as to whether the attorney had access to confidential information in the course of the former representation. To avoid this problem, the ‘substantial relationship’ test was developed: ‘[The] former client need show no more than that the matters embraced within the pending suit wherein his former attorney appears on behalf of his adversary are substantially related to the matters or cause of action [where] the attorney previously represented him, the former client. The Court will assume that during the course of the former representation confidences were disclosed to the attorney bearing on the subject matter of the representation.” Civil Serv. Com v. Sup. Ct., 163 Cal. App.3d 70,79 (1984) (emphasis added).

The substantial relationship test is easily met here because, again, Mr. Alden was consulted on

1 Defendants also claim that Plaintiff had “disclaim[ed] an attorney-client relationship” in the Advance Waiver. Opposition at 6. However, “[s]uch disclaimers are ineffective.” Benninghoff v. Sup. Ct., 136 Cal. App. 4th 61, 73 (2006). Regardless, an attorney-client relationship had formed between Plaintiff and Quinn Emanuel. See Evidence Code, §951 (defining “client” as “a person who...consults a lawyer for the purpose of retaining the lawyer or securing legal service or advice from [the lawyer]…”); In re Dupont's Estate, 60 Cal. App. 2d 276, 288-89 (1943) (noting universal acceptance that communication by client of preliminary statement of his case to an attorney is privileged even if the attorney is not hired).

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the same lawsuit. Mr. Alden is “assumed” to receive confidential information from Plaintiff and

should be disqualified.2 See In re Marriage of Abernethy, 5 Cal.App.4th 1193, 1197, n.3 (1992) (“[i]t

is the possibility of the breach of confidence, not the fact of an actual breach that triggers

disqualification.”). Indeed, Defendants acknowledge Mr. Alden’s clear disqualification from

representing them by purportedly walling him off from this matter.

B. The Entire Quinn Emanuel Firm Must Be Vicariously Disqualified

Given Mr. Alden’s obvious conflict, Quinn Emanuel must be vicariously disqualified. Flatt, 9

Cal.4th at 283 (where, as here, the substantial relationship test is met, “the disqualification extends

vicariously to the entire firm”); Goldberg v. Warner/Chappel Music, Inc., 125 Cal.App.4th 752, 765

(2d Dist. 2005) (vicarious disqualification rule is based on “a pragmatic recognition that the

confidential information will work its way to the nontainted attorneys at some point”). Vicarious

disqualification is “especially” required in side-switching cases. See City Nat’l Bank v. Adams, 96

Cal. App. 4th 315, 328 (2002) (rule requiring vicarious disqualification of entire law firm “is

especially true where the attorney’s disqualification is due to his prior representation of the opposing

side during the same lawsuit”) (citations omitted).

III. THE ETHICAL SCREEN, AND THE KIRK CASE, DO NOT SAVE QUINN EMANUEL FROM DISQUALIFICATION

Kirk Is Distinguishable. The Kirk v. First Am. Title Ins. Co., 183 Cal. App. 4th 776 (2010)

does not help Quinn Emanuel. In that case, the court addressed the circumstances under which ethical 2 Mr. Alden actually received confidential information from Plaintiff and gave legal advice to Plaintiff. See Plaintiff Dec., ¶¶7-13. Even if one were to take Mr. Alden’s declaration at face value, the declaration and the Advance Waiver still reveal that Plaintiff provided confidential information to Mr. Alden: (i) Plaintiff and Mr. Alden (a very busy litigation partner at a major firm) spoke at least twice for 40 minutes by phone regarding filing this very same lawsuit; (ii) Mr. Alden does not dispute that he received confidential information about the proposed lawsuit during these phone calls; (iii) based on the information received in the calls, Mr. Alden knew enough about the key players to identify, in the Advance Waiver, Evan Spiegel, John Spiegel, Bobby Murphy, and Lightspeed Ventures Partners as potential defendants in the proposed lawsuit; (iv) the parties exchanged at least 22 emails regarding the proposed lawsuit; (v) Mr. Alden admitted that during some of the calls, he “tried to gather information from Mr. Brown about the facts and circumstances of his dispute in order to assess the matter”; and (vi) In the Advance Waiver, Quinn Emanuel acknowledges that during the assessment, “Quinn Emanuel may receive from [Plaintiff] or provide [Plaintiff] confidential information regarding the Matter.” Plaintiff Dec., Exh. B.

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screening might prevent disqualification of a newly-arrived attorney having confidential information

concerning a party his new law firm is adverse to. Indeed, the court focused on policy considerations

permitting attorney mobility. See id. at 802 (“attorney mobility and firm mergers have increased

exponentially”). The Kirk court was careful “to emphasize that we are not adopting a broad rule

permitting ethical screening in all cases” (id. at 802 n.21), and limited its holding by stating that, “In

sum, we have concluded that, when a tainted attorney moves from one private law firm to another, the

law gives rise to a rebuttable presumption of imputed knowledge to the law firm, which may be

rebutted by evidence of effective ethical screening.” Id. at 814 (emphasis added). The Kirk court also

noted that the “tainted” attorney already left the firm. Id. 816-816. Significantly, the court explicitly

reaffirmed existing case law that ethical screening will never save a firm who, as here, switches sides

in the same case from disqualification. See Kirk, 183 Cal. App. 4th at 800 (“vicarious disqualification

should be automatic in cases of a tainted attorney possessing actual confidential information from a

representation, who switches sides in the same case”) (citing Henriksen v. Great American Savings &

Loan, 11 Cal.App.4th 109, 116-117 (1992) (ordering vicarious disqualification of entire firm and

holding that “screening concept as not applicable when the attorney in question performed work for

the opposing party in the same lawsuit”). Here, we do not have a newly-arrived attorney. Mr. Alden

was with Quinn Emanuel when he counseled Plaintiff and is still with the firm, and the firm switched

sides in the same case.

Quinn Emanuel Agreed That Kirk Is Distinguishable. Not too long ago, Quinn Emanuel

agreed with the above analysis of Kirk. In 2011, Quinn Emanuel sought to disqualify the Glaser Weil

firm from the high-profile Mattel, Inc. v. MGA Entertainment, Inc. case on the eve of trial for hiring an

ex-Quinn attorney who used to work on the same case. RJN, Ex. B. In response to the Glaser Weil’s

claim that it had erected an ethical screen consistent with Kirk, Quinn Emanuel represented to the

Judge David O. Carter that “[t]he general rule in California is that where an attorney is disqualified,

that attorney's entire firm is disqualified as well regardless of efforts to erect an ethical wall.” RJN,

Exh. C at 1:1-4, n.1 (emphasis added) (quoting Tuft, Non-Consensual Screening for Conflicts in

California, 843 PLI/Lit 35, at 2 (December 2010)).

Quinn Emanuel also correctly stated to Judge Carter in the same disqualification motion that

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Kirk is distinguishable because in Kirk, “the ‘tainted’ attorney had already left the firm whose

representation was being challenged. See Kirk, 183 Cal. App. 4th at 815-16. That fact is highly

significant, because ‘[w]here tainted attorneys and nontainted attorneys are working together at the

same firm, there is ... a pragmatic recognition that the confidential information will work its way to the

nontainted attorneys at some point,’ but when the tainted attorney is gone, the court can conduct a

“dispassionate assessment of whether confidential information was actually exchanged.’ See

Goldberg, 125 Cal. App. 4th at 765.” RJN, Exh. B at7:18-21.

More importantly, Quinn Emanuel also correctly told Judge Carter that, as shown, Kirk made

clear that no ethical wall can save a firm that switched sides in the same lawsuit. RJN, Exh. B at 8

(“[e]ven Kirk recognizes that in an egregious case such as this one, where an attorney worked on the

other side of the same litigation, an ethical wall cannot ‘cure’ the conflict”).

Quinn Emanuel also referred Judge Carter to Openwave Systems, Inc. v. 724 Solutions (US)

Inc., 2010 WL 1687825 (N.D.Cal.) (“724 Solutions”), a post-Kirk decision, which granted a motion to

disqualify despite the presence an ethical wall. RJN, Exh. B at 6, 7. The 724 Solutions court held that

the ethical wall was not sufficient and Kirk did not apply because there was a “substantial

relationship” between the former and current representations. Id. at *5. The court also held that the

ethical wall was insufficient was required due to the “close proximity” between the “tainted” attorney

and the non-tainted attorneys.3 Judge Carter obviously agreed with Quinn Emanuel because he

disqualified Glaser Weil. RJN, Exh. D. 4 3 Here, the substantial relationship test is clearly met, and Mr. Alden works in the same Los Angeles office as all the Quinn Emanuel attorneys representing Defendants. 4 Defendants claim that “[s]ince Kirk, courts consistently deny vicarious disqualification motions where ethical walls are in place.” Opposition at 14. However, the cases cited by Defendants do not hold (and no case has held) that an ethical wall would automatically save a firm from vicarious disqualification. In Openwave Sys. Inc. v. Myriad France S.A.S, 2011 WL 1225978 at *6-7 (N.D. Cal.), disqualification was denied notably because the motion was made just before discovery cut-off, and disqualification at that juncture would result in great prejudice. The court cautioned that the “main lesson here is that motions to disqualify should be promptly made before the parties are invested substantially in their litigation line-ups.” Id. at *7. In Silicon Graphics, lnc. v. AT1 Technologies, Inc., 741 F. Supp. 2d 970, 979-81 (W.D. Wis. 2010), the court applied the Seventh Circuit standard for assessing the adequacy of ethical screens. In Barco N.V. v. Tech. Properties Ltd., 2011 WL 841283 (N.D. Cal.), there was not even an ethical wall. Tellingly, Defendants do not cite to the 724 Solutions case that Quinn Emanuel previously brought to Judge Carter’s attention.

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This Court should adopt the same analysis previously advocated by Quinn Emanuel, and

should issue the same relief previously advocated (and obtained) by the firm.5

IV. THE ADVANCE WAIVER IS NOT ADEQUATE UNDER THE VISA FACTORS

Defendants agree that the enforceability of the Quinn Emanuel’s Advance Waiver is

determined under the Visa U.S.A., Inc. v. First Data Corp., 241 F.Supp.2d 1100, 1105 (N.D. Cal.

2003) factors. Opposition at 10-13. We discuss these factors below.6

Breadth of the Waiver. Contrary to Defendants’ claim, the Advance Waiver is much

broader than another waiver that was invalidated by the court in Concat LP v. Unilever, PLC, 350

F.Supp.2d 796, 820 (N.D.Cal. 2004). The chart below compares the two waivers:

Morgan Lewis Advance Waiver Invalidated in Concat

Quinn Emanuel Advance Waiver Here

“Morgan, Lewis & Bockius may continue to represent, or may undertake in the future to represent, existing or new clients in any matter, including litigation, that is not substantially related to our work for you, even if the interests of such clients in those other matters are directly adverse to you.” Id. (emphasis added)

Quinn Emanuel “may represent any entity . . . with respect to any matter or case . . . adverse to [Plaintiff], including the Matter.” Plaintiff Dec., Exh. B, para. 5. (emphasis added)

The Quinn Emanuel Advance Waiver is much broader in that it allows the firm to represent

adverse parties in any matter including this matter for which Plaintiff previously consulted the firm.

In contrast, the Morgan Lewis waiver only allows the firm to represent adverse parties in a matter

5 The purported ethical wall erected by Quinn Emanuel is also not effective for another reason: the firm admitted that confidential information from Plaintiff had already been disseminated to all of its partners. See Tayback Dec., ¶3 (acknowledging that an email from Plaintiff to Mr. Alden and other Quinn attorneys was then “forwarded to all Quinn Emanuel partners”). And even if Mr. Alden purportedly did not discuss this Motion with anyone else in the firm, his lawyer and agent “coordinate[d] with other members of the Firm” in opposing the Motion. Alden Dec., ¶28. The fact that Mr. Alden’s agent communicated with other firm attorneys is no different than if Mr. Alden himself communicated with other firm attorneys. That is why courts have consistently applied the vicarious disqualification rule because “the confidential information will work its way to the nontainted attorneys at some point.” Goldberg, 125 Cal.App.4th at 765. 6 Defendants claim that “California courts consistently enforce prospective waivers of conflicts.” Opposition at 8. But none of the cases cited in support of this claim are apposite here, because none of them involved waivers allowing side-switching in the same matter.

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“that is not substantially related to our work for you.” This factor clearly favors Plaintiff.

Temporal Scope of the Waiver. Visa states this factor as follows: “whether [the waiver]

waived a current conflict or whether it was intended to waive all conflicts in the future.” Visa, 241

F.Supp.2d at 1106. This is not even a close call. This factor favors Plaintiff because the Advance

Waiver contains no time restriction and, if enforced, would allow Quinn Emanuel to take on any

conflicted engagement at any time in the future. See also Concat, 350 F.Supp.2d at 820 (invalidating

waiver because “its temporal scope is likewise unlimited”).

Quality of the Conflict Discussion. The only communication regarding the Advance Waiver

was the short email below from Mr. Alden to Plaintiff, purporting to summarize the document

(Plaintiff Dec., ¶ 6): I’ve attached a waiver I’d like you to sign. Because we get many calls from different people interested in bringing lawsuits, many of which we do not take on, we need to ensure that our discussions with potential clients do not result in us being conflicted from acting for others down the road. In essence, this agreement provides that if we do not end up representing you in this matter, you cannot disqualify us in the (unlikely) event we’re hired to act against you in the future. The likelihood of this ever happening is small, but it’s a precaution we need to take. If you have any questions, I’d be happy to discuss them tomorrow or I can refer you to another lawyer who could go over with you. Alden Dec., Exh. A.

Defendants cannot seriously claim that this email amounts to a meaningful conflict discussion.

This purported summary does not even mention that the waiver ostensibly allows Quinn Emanuel to

represent an adverse party against Plaintiff in the very same matter! Instead, it uses the opaque

legalese “conflicted from acting for others down the road” and “act against you in the future.” Of

course, Mr. Alden could have made this critical, central aspect of the waiver clear in one sentence– but

chose not to do so. Mr. Alden’s lack of clarity explains why Plaintiff testified he thought he was

signing an “engagement letter” (Motion at 5), and not a waiver. Mr. Alden also downplayed the

conflict potential as “unlikely” and “small,” and that the document was just a “precaution” taken by

his firm.

Specificity of the Waiver. Quinn Emanuel did not carry their “heavy burden of

demonstrating that all relevant facts relating to the conflict were disclosed and explained to the

client.” Civil Serv. Comm’n, 163 Cal.App.3d at 84. The Advance Waiver is not specific enough in

that it does not disclose all the potential adverse parties. No mention is made whatsoever of the most

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obvious corporate defendants, Snapchat, Inc. or Toyopa Group LLC. Plaintiff Dec., Exh. B. No

effort was made to add Benchmark Capital as a potential adversary in the Advance Waiver (although

the document recognizes another investor, Lightspeed Venture Partners, as a potential adversary), and

there was no disclosure that Benchmark Capital—a potential adversary—was a Quinn Emanuel

client. Id. ¶12. Incredibly, Defendants now blame Plaintiff for not including Benchmark in the

Advance Waiver despite the fact that: (i) this is a Quinn Emanuel document; and (ii) Benchmark is a

Quinn Emanuel client. This factor also favors Plaintiff.

Nature of Actual Conflict. The Visa court explained this factor as follows: “whether the

attorney sought to represent both clients in the same dispute or in unrelated disputes.” Visa, 241

F.Supp.2d at 1106. There is no question here that the successive representations were for the same

dispute. This factor is clearly in favor of Plaintiff.

Sophistication of Client. Defendants completely misstate this factor, which focuses on the

client’s “level of experience with legal services.” Visa, 241 F.Supp.2d at 1109-10 (validating waiver

where client “is a knowledgeable and sophisticated user of legal services [that] has a legal department

of about fifty lawyers”). There is no dispute that Plaintiff, a 23-year old recent college graduate, has

never been involved in any litigation matter. Plaintiff Dec., ¶ 3.

Defendants argue that Plaintiff “majored in English,” “worked at a state Attorney’s General

Office and consulted with numerous lawyers before Alden.” Opposition at 13. These arguments are

meritless. This Visa factor does not focus on proficiency in English, but rather sophistication in hiring

law firms. Plaintiff has never been to law school, and started working as an unpaid intern for the

South Carolina Attorney’s General Office in March of 2013– long after he consulted with Mr. Alden.

Sarles Dec., Exh. D at 13:2-19. And the “numerous lawyers” that Plaintiff consulted consisted of one

professor at his alma mater, and two other attorneys (Opposition at 4), and he hired neither of them.

Plaintiff is no sophisticated user of legal services. Defendants’ grasping at straws only underscores

their lack of credibility in opposing this Motion. This factor also favors Plaintiff.

Interest of Justice. This factor favors Plaintiff. As discussed, side-switching in the same

matter is the “most egregious conflict of interest.” 20 Cal.4th at 1147. Also, while Defendants– who

again, knowingly hired the firm Plaintiff consulted– wish the court to consider their interests in ruling

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on disqualification, this Court should not do so. In Visa, the court refused to consider the interests of

the allegedly conflicted counsel and its client because there was no showing that disqualification was

sought after delay to gain a tactical advantage. Visa, 241 F.Supp.2d at 1107 n.6. The same analysis

applies here.

In any event, Defendants will not be prejudiced by Quinn Emanuel’s disqualification because:

(i) the firm just recently substituted into the matter; and (ii) since the substitution, the case has

essentially been stayed; and (iii) the case is still at an early stage with no trial date scheduled. In

contrast, Plaintiff will be prejudiced if he were forced to litigate against the same law firm with which,

just a few months earlier, he was sharing confidential information and receiving advice on this same

matter.7

CONCLUSION

For the above reasons, this Court should grant this Motion and disqualify Quinn Emanuel. DATED: July 25, 2013 LEE TRAN & LIANG APLC

By K. Luan Tran James M. Lee Cyrus Khojandpour Lisa Chin

RAY A. MANDLEKAR, ATTORNEY AT LAW Ray A. Mandlekar (SBN 196797) Attorneys for Plaintiff

7 This Motion is not made for tactical purposes. Quinn Emanuel’s conflict is real and Plaintiff raised the conflict issue right away. Motion at 8. SpeeDee Oil, 20 Cal.4th at 1145 n.2 (concerns of tactical abuse in bringing disqualification motion “almost entirely absent” where there was no showing that the conflict was purposely manufactured or that the party unreasonably delayed in bringing the motion). Also, due to the relationship and friendship between Plaintiff’s attorneys at LTL and Quinn Emanuel, it should be obvious that LTL would not resort to this type of motion for improper or tactical reasons. If anything, Defendants were the ones that tactically hired Quinn Emanuel right after finding out that Plaintiff consulted the firm on this case.

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OBJECTIONS TO SARLES DECLARATION ISO OPPOSITION TO PLAINTIFF’S MOTION TO DISQUALIFY





Plaintiff,


Defendants.

CASE NO: BC501483 PLAINTIFF FRANK BROWN’S OBJECTIONS TO THE DECLARATION OF JOSEPH C. SARLES IN SUPPORT OF OPPOSITION TO PLAINTIFF’S MOTION TO DISQUALIFY Assigned for all purposes to the Honorable John L. Segal (Dept. 50) [Plaintiff’s Reply in Further Support of Motion to Disqualify, Objection to Declaration of Robert Kehr, Response to Defendants’ Objections and Request for Judicial Notice filed concurrently herewith] Hearing: Date: August 1, 2013 Time: 8:30 a.m. Dept.: 50 Action Filed: February 21, 2013 Trial Date: Not Assigned Yet

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MATERIAL OBJECTED TO: GROUNDS FOR OBJECTION: COURT’S RULING:

Sarles Decl., ¶ 4 & Exhibit A (May 8, 2012 email from Brown to Spiegel)

Lacks Foundation (Cal. Evid. Code §§ 403 and 405); Lack of Authentication (Cal. Evid. Code §§ 1400 and 1401); Lacks Personal Knowledge (Cal. Evid. Code §§ 702): Mr. Sarles lacks personal knowledge and foundation to authenticate Exhibit A, an email dated May 8, 2012 purportedly from Plaintiff to Defendant Spiegel. Mr. Sarles was not the sender or recipient of the email.

Offer to Compromise (Cal. Evid. Code § 1152): Moreover, in their Opposition, Defendants cite Exhibit A in support of the proposition that Plaintiff “admitted that his role in the project was not equal to that of [Defendants] Spiegel and Murphy” by improperly quoting a the following offer of settlement in the email: “As I expressed to Bobby this past summer, I understood both then and currently that my role in the process was of a different nature and was thus willing to accept a significantly less portion of equity than either of you.” This is improper and cannot be used as evidence.

Relevance (Cal. Evid. Code §§ 210 and 350): Exhibit A is irrelevant and/or immaterial to the legal and factual issues at issue in Plaintiff’s Motion to Disqualify. Specifically, the email contains no statements having any tendency to prove or disprove any disputed fact of consequence to the determination of whether (i) an attorney-client relationship was formed between Plaintiff and Alden; (ii) any disqualification should be imputed to the entire Quinn Emanuel firm; (iii) the conflict waiver should be enforced; (iv) a second conflict waiver was required; or (iv) whether Quinn Emanuel’s ethical screening prevents disqualification.

Sustained: _____

Overruled: _____

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Sarles Decl., Exhibit B (Plaintiff’s handwritten notes)

Relevance (Cal. Evid. Code §§ 210 and 350): Exhibit B is irrelevant and/or immaterial to the legal and factual issues at issue in Plaintiff’s Motion to Disqualify. Defendants cite Exhibit B for the proposition that Plaintiff knew that Future Freshman LLC was owned by Defendants Spiegel and Murphy “60/40.” Regardless, neither this “fact,” even if true—it is not—nor any other statements in Exhibit B have any tendency to prove or disprove any disputed fact of consequence to the determination of whether (i) an attorney-client relationship was formed between Plaintiff and Alden; (ii) any disqualification should be imputed to the entire Quinn Emanuel firm; (iii) the conflict waiver should be enforced; (iv) a second conflict waiver was required; or (iv) whether Quinn Emanuel’s ethical screening prevents disqualification.

Sustained: _____

Overruled: _____

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Sarles Decl., ¶ 6 & Exhibit C (July 13, 2011 email from Brown to Spiegel)

Lacks Foundation (Cal. Evid. Code §§ 403 and 405); Lack of Authentication (Cal. Evid. Code §§ 1400 and 1401); Lacks Personal Knowledge (Cal. Evid. Code §§ 702): Mr. Sarles lacks personal knowledge and foundation to authenticate Exhibit C, an email dated July 13, 2011 purportedly from Plaintiff to Defendant Spiegel, attaching a press release for Picaboo. Mr. Sarles was not the sender or recipient of the email.

Relevance (Cal. Evid. Code §§ 210 and 350): Exhibit C is irrelevant and/or immaterial to the legal and factual issues at issue in Plaintiff’s Motion to Disqualify. Defendants cite Exhibit C for the proposition that Plaintiff knew that Toyopa owned the rights to the disappearing messages application. Regardless, neither this “fact,” even if true—it is not—nor any other statements in Exhibit C have any tendency to prove or disprove any disputed fact of consequence to the determination of whether (i) an attorney-client relationship was formed between Plaintiff and Alden; (ii) any disqualification should be imputed to the entire Quinn Emanuel firm; (iii) the conflict waiver should be enforced; (iv) a second conflict waiver was required; or (iv) whether Quinn Emanuel’s ethical screening prevents disqualification.

Sustained: _____

Overruled: _____

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Sarles Decl., Exhibit D (April 4, 2013 Deposition of Plaintiff Brown) at 54:9-56:18.

Relevance (Cal. Evid. Code §§ 210 and 350): Exhibit D at 54:9-56:18 is irrelevant and/or immaterial to the legal and factual issues at issue in Plaintiff’s Motion to Disqualify. Defendants cite this excerpt for the proposition that Plaintiff knew that Toyopa was owned solely by Spiegel and Murphy. Regardless, this “fact,” even if true—it is not—does not have any tendency to prove or disprove any disputed fact of consequence to the determination of whether (i) an attorney-client relationship was formed between Plaintiff and Alden; (ii) any disqualification should be imputed to the entire Quinn Emanuel firm; (iii) the conflict waiver should be enforced; (iv) a second conflict waiver was required; or (iv) whether Quinn Emanuel’s ethical screening prevents disqualification.

Sustained: _____

Overruled: _____

Sarles Decl., Exhibit D (April 4, 2013 Deposition of Plaintiff Brown) at 231:16-232:9

Relevance (Cal. Evid. Code §§ 210 and 350): Exhibit D at 231:16-232:9is irrelevant and/or immaterial to the legal and factual issues at issue in Plaintiff’s Motion to Disqualify. Defendants cite this excerpt for the proposition that Plaintiff knew that Toyopa owned the rights to the disappearing messages application. Regardless, this “fact,” even if true—it is not—does not have any tendency to prove or disprove any disputed fact of consequence to the determination of whether (i) an attorney-client relationship was formed between Plaintiff and Alden; (ii) any disqualification should be imputed to the entire Quinn Emanuel firm; (iii) the conflict waiver should be enforced; (iv) a second conflict waiver was required; or (iv) whether Quinn Emanuel’s ethical screening prevents disqualification.

Sustained: _____

Overruled: _____

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Sarles Decl., Exhibit D (April 4, 2013 Deposition of Plaintiff Brown) at 411:16-412:5

Relevance (Cal. Evid. Code §§ 210 and 350): Exhibit D at 411:16-412:5 is irrelevant and/or immaterial to the legal and factual issues at issue in Plaintiff’s Motion to Disqualify. Defendants cite this excerpt for the proposition that Plaintiff knew that Future Freshman LLC was owned solely by Spiegel and Murphy, and not him. Regardless, this “fact,” even if true—it is not—does not have any tendency to prove or disprove any disputed fact of consequence to the determination of whether (i) an attorney-client relationship was formed between Plaintiff and Alden; (ii) any disqualification should be imputed to the entire Quinn Emanuel firm; (iii) the conflict waiver should be enforced; (iv) a second conflict waiver was required; or (iv) whether Quinn Emanuel’s ethical screening prevents disqualification.

Sustained: _____

Overruled: _____

Sarles Decl., Exhibit E (July 21, 2011 letter from USPTO to Toyopa Group)

Relevance (Cal. Evid. Code §§ 210 and 350): Exhibit E is irrelevant and/or immaterial to the legal and factual issues at issue in Plaintiff’s Motion to Disqualify. Defendants cite Exhibit E for the proposition that Plaintiff created a customer account for Toyopa with the PTO and told Spiegel and Murphy that he would use this account for the patent application. This fact does not have any tendency to prove or disprove any disputed fact of consequence to the determination of whether (i) an attorney-client relationship was formed between Plaintiff and Alden; (ii) any disqualification should be imputed to the entire Quinn Emanuel firm; (iii) the conflict waiver should be enforced; (iv) a second conflict waiver was required; or (iv) whether Quinn Emanuel’s ethical screening prevents disqualification.

Sustained: _____

Overruled: _____

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Sarles Decl., Exhibit F (August 11, 2011 Provisional Patent Application)

Relevance (Cal. Evid. Code §§ 210 and 350): Exhibit F is irrelevant and/or immaterial to the legal and factual issues at issue in Plaintiff’s Motion to Disqualify. Defendants cite Exhibit F for the proposition that Plaintiff secretly filed the patent application in an attempt to steal Defendants’ ownership rights. Regardless, neither this “fact,” even if true—it is not—nor any other statement in Exhibit F has the tendency to prove or disprove any disputed fact of consequence to the determination of whether (i) an attorney-client relationship was formed between Plaintiff and Alden; (ii) any disqualification should be imputed to the entire Quinn Emanuel firm; (iii) the conflict waiver should be enforced; (iv) a second conflict waiver was required; or (iv) whether Quinn Emanuel’s ethical screening prevents disqualification.

Sustained: _____

Overruled: _____

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Sarles Decl., ¶ 10 & Exhibit G (August 22, 2011 email from Brown to Spiegel)

Lacks Foundation (Cal. Evid. Code §§ 403 and 405); Lack of Authentication (Cal. Evid. Code §§ 1400 and 1401); Lacks Personal Knowledge (Cal. Evid. Code §§ 702): Mr. Sarles lacks personal knowledge and foundation to authenticate Exhibit G, an email dated August 22, 2011 purportedly from Plaintiff to Defendant Spiegel. Mr. Sarles was not the sender or recipient of the email.

Relevance (Cal. Evid. Code §§ 210 and 350): Exhibit G is irrelevant and/or immaterial to the legal and factual issues at issue in Plaintiff’s Motion to Disqualify. Defendants cite Exhibit G for the proposition that Brown told Spiegel and Murphy he had filed the patent application, but refused to provide a copy of it. Regardless, neither this “fact,” even if true—it is not—nor any other statements in Exhibit G have any tendency to prove or disprove any disputed fact of consequence to the determination of whether (i) an attorney-client relationship was formed between Plaintiff and Alden; (ii) any disqualification should be imputed to the entire Quinn Emanuel firm; (iii) the conflict waiver should be enforced; (iv) a second conflict waiver was required; or (iv) whether Quinn Emanuel’s ethical screening prevents disqualification.

Sustained: _____

Overruled: _____

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Sarles Decl., Exhibit H (April 9, 2013 Deposition of Robert Murphy)

Hearsay (Cal. Evid. Code § 1200): Exhibit H at 120:19-122:4 contains testimony about a conversation between Plaintiff Brown and Defendants Murphy, Spiegel regarding their respective interests in the company. These are out of court statements offered for the truth of the matter stated, and are therefore inadmissible hearsay. Relevance (Cal. Evid. Code §§ 210 and 350): Exhibit H is irrelevant and/or immaterial to the legal and factual issues at issue in Plaintiff’s Motion to Disqualify. Defendants cite Exhibit H for the proposition that Brown demanded equity in only after Spiegel raised questions about the patent application. Regardless, neither this “fact,” even if true—it is not—nor any other statements in Exhibit G have any tendency to prove or disprove any disputed fact of consequence to the determination of whether (i) an attorney-client relationship was formed between Plaintiff and Alden; (ii) any disqualification should be imputed to the entire Quinn Emanuel firm; (iii) the conflict waiver should be enforced; (iv) a second conflict waiver was required; or (iv) whether Quinn Emanuel’s ethical screening prevents disqualification.

Sustained: _____

Overruled: _____

DATED: July 25, 2013 LEE TRAN & LIANG APLC



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OBJECTIONS TO KEHR DECLARATION ISO OPPOSITION TO PLAINTIFF’S MOTION TO DISQUALIFY





Plaintiff,


Defendants.

CASE NO: BC501483 PLAINTIFF FRANK BROWN’S OBJECTIONS TO THE DECLARATION OF ROBERT L. KEHR IN SUPPORT OF OPPOSITION TO PLAINTIFF’S MOTION TO DISQUALIFY Assigned for all purposes to the Honorable John L. Segal (Dept. 50) [Plaintiff’s Reply in Further Support of Motion to Disqualify, Objections to Declaration of Joseph C. Sarles, Response to Defendants’ Objections and Request for Judicial Notice filed concurrently herewith] Hearing: Date: August 1, 2013 Time: 8:30 a.m. Dept.: 50 Action Filed: February 21, 2013 Trial Date: Not Assigned Yet

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Plaintiff Frank Reginald Brown, IV’s (“Plaintiff”) objects to the Declaration of Robert L.

Kehr in Support of Defendants’ Opposition to Motion to Disqualify (“Kehr Declaration” or “Kehr

Decl.”). Plaintiff hereby requests that the Court disregard, exclude, or strike the Kehr Declaration

on the basis that it consists entirely of improper legal conclusions in direct contravention of

longstanding rules prohibiting expert opinions on questions of law.

The Kehr Declaration amounts to nothing more than legal argument, mirroring nearly

verbatim Defendants’ Opposition to Plaintiff’s Motion to Disqualify.1 Through the Declaration,

Defendants attempt to usurp this Court’s proper role as the ultimate authority on the law in this

case, implying that Mr. Kehr is better capable of determining that law than this Court. Defendants’

counsel Quinn Emanuel knows that such a declaration is inadmissible, as Quinn Emanuel itself

objected to and moved to strike a similar declaration from Mr. Kehr submitted in opposition to a

motion to disqualify in another matter on the very same basis—that Mr. Kehr’s declaration offered

nothing more than improper legal conclusions.

Not only does Mr. Kehr improperly undertake to instruct the Court on “the law,” he tells

the Court what he thinks the outcome of the motion should be despite authority categorically

announcing that lawyer experts are not permitted to give such opinions. As such, the Kehr

Declaration should be excluded from consideration and stricken in its entirety.2

I. APPLICABLE LAW

As a general rule, the opinion of an expert is admissible when it is “[r]elated to a subject

that is sufficiently beyond common experience that the opinion of an expert would assist the trier

of fact . . . . Cal. Evid. Code § 801. Additionally, in California, “[t]estimony in the form of an

opinion that is otherwise admissible is not objectionable because it embraces the ultimate issue to

1 The 13 pages of the Kehr Declaration so much resembles a legal brief, that Plaintiff also objects on the basis that Defendants’ Opposition brief now exceeds the 15-page limit. See Cal. R. Ct. 3.1113 2 The only conceivable portion of the Kehr Declaration that may pass muster as a non-legal opinion is Mr. Kehr’s opinion, based on his personal experience, as to the types of advance conflict waivers “many large law firms now attempt to obtain from new clients.” Kehr Decl. 10:20-24. Even that portion of the declaration is objectionable on the basis of relevance. See Cal. Evid. Code § 350.

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be decided by the trier of fact.” Cal. Evid. Code § 805. However, “the admissibility of opinion

evidence that embraces an ultimate issue in a case does not bestow upon an expert carte blanche to

express any opinion he or she wishes.” Summers v. A.L. Gilbert Co., 69 Cal. App. 4th 1155, 1178

(1999). One notable limitation to expert testimony is the longstanding prohibition on expert

opinion on a question of law. Id. (citing Ferreira v. Workmen’s Comp. Appeals Bd., 38

Cal.App.3d 120 (1974)).

Because the law is the province of the courts, experts are not permitted to testify to legal

opinions or conclusions. See Sheldon Appel Co. v. Albert & Oliker, 47 Cal. 3d 863, 884 (1989) (“It

is thoroughly established that experts may not give opinions on matters which are essentially

within the province of the court to decide.”); WRI Opportunity Loans II, LLC v. Cooper, 154 Cal.

App. 4th 525, 532 n.3 (2007) (same). That is, while “Evidence Code section 805 permits expert

testimony on the ultimate issue to be decided by the fact finder . . . this rule ‘does not authorize an

expert to testify to legal conclusions in the guide of expert opinion.’” Id. (quoting Downer v.

Bramet, 152 Cal. App. 3d 837, 841 (1984)).

Therefore, courts have particularly disfavored testimony of lawyers as “experts,” except in

limited cases. As explained in Downer: While in many cases expert opinions that are genuinely needed may happen to embrace the ultimate issue of fact (e.g. a medical opinion whether a physician's actions constitute professional negligence), the calling of lawyers as “expert witnesses” to give opinions as to the application of the law to particular facts usurps the duty of the trial court . . . and results in no more than a modern day “trial by oath” in which the side producing the greater number of lawyers able to opine in their favor wins.

152 Cal. App. 3d 837, 842 (1984); see also Summers, 69 Cal. App. 4th 1155, 1179-81 (1999). The

Summers court noted that serious questions concerning the proper role of expert testimony are

raised “especially when the purported expert is a lawyer.” 69 Cal. App. 4th at 1178 (emphasis

added). The court further explained that “[t]he manner in which the law should apply to the

particular facts is a legal question and is not subject to expert opinion.” Id. 1178-79 (citing

Ferreira v. Workmen's Comp. Appeals Bd. 38 Cal. App. 3d 120, 125-26 (1974).) Similarly, the

court in Adams v. City of Fremont, 68 Cal. App. 4th 243 (1998), concluded that “[o]pinion

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testimony is inadmissible and irrelevant to adjudging questions of law.” Id. at 266. Finally, in the

case of Sullivan v. Fox, 189 Cal. App. 3d 673 (1987), the court made it clear that interpretation of

a statute offered by an attorney as expert opinion in his declaration is inadmissible as involving a

question of law and must, for that reason, be disregarded. Id. at 682.

II. THE KEHR DECLARATION, IN ITS ENTIRETY, CONSISTS OF

INADMISSIBLE LEGAL OPINION.

California Evidence Code sections 801 and 805 permit expert opinion solely upon issues of

fact, not upon issues of law. In his Declaration, Mr. Kehr sets forth his legal opinions concerning:

(1) whether Plaintiff has a “fundamental misunderstanding” of the Rule of Professional Conduct

of the State Bar of California (Kehr Decl. 2:1-2), (2) whether Plaintiff’s analysis of the law of

“side-switching” is correct (Kehr Decl. 2:8-26), (3) whether Plaintiff and Defendants’ counsel

Quinn Emanuel formed an attorney-client relationship (Kehr Decl. 3:3-5:2), (4) California law on

the propriety of ethical screens (Kehr Decl 5:3-7:12), (5) California requirements regarding

obtaining a second consent form and the applicability of CRPC 3-310(c)(2) (Kehr Decl.

7:13-8:17), (6) the multi-factor test that determines whether an advance waiver is enforceable in

California (Kehr Decl. 8:18 -11:21), and (7) the legal ramifications of the extent of the interaction

and transfer of information between a prospective client and an attorney (Kehr Decl. 11:22-12:14).

In support of its many legal propositions Mr. Kehr’s Declaration offers extensive citation

to legal authorities and argument interpreting these authorities. See, e.g., Kehr Decl., 9:4-18

(interpreting the Zador decision). Even a cursory review of Mr. Kehr’s Declaration reveals its true

purpose—Mr. Kehr’s Declaration is not a declaration at all, but rather a memorandum of points

and authorities.

The Kehr Declaration is replete with legal argument. As just one example: The existence of a lawyer-client relationship is not determined under the Evidence Code. Rather, one exists when a person actually relies on a lawyer for legal advice or representation and that actual reliance is objectively reasonable under the circumstances. See, e.g., Restatement Third, The Law Governing Lawyers § 14(1)(b).

(Kehr Decl. 4:7-10.). Other times, Mr. Kehr opts to simply proffer propositions of law without

citation or authority. See e.g., Kehr Decl. 2:20-22 (“A lawyer switches sides only when the lawyer

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represents a party to a lawsuit and, upon the termination of that representation, undertakes to

represent an adversary in the same matter.”). Clearly, what Mr. Kehr has offered to this Court is an

opinion on the law and, in particular, the meaning, interpretation and application of the Rules of

Professional Conduct and the decisional law of California.

As the Summers court noted, “California is not alone in excluding expert opinions on issues

of law. . . . At least eight circuit courts have held expert testimony on issues of law is not

admissible.” 69 Cal. App. 4th at 1181 (noting that “experience is hardly a qualification for

construing a document for its legal effect when there is a knowledge gentleman in a robe. . . .”

[citations omitted] “Each courtroom comes equipped with a ‘legal expert,’ called a judge.”

[citations omitted]).

What is troubling about this case is that in April of 2010, Quinn Emanuel moved to

disqualify opposing plaintiff’s counsel on the basis of, among other things, a conflict of interest the

matter of O’Shea, et al. v. Epson America, Inc. et al., Case No. 09-0863 PSG (CWx), Central

District of California. In opposition to the motion to disqualify, plaintiff’s counsel submitted the

declaration of one Robert L. Kehr. See Plaintiff’s Request for Judicial Notice , Ex. A.

Quinn Emanuel responded by objecting on the same exact bases presented in this

objection—that Mr. Kehr rendered inadmissible legal opinions. Id. Quinn Emanuel’s objection

noted that: Mr. Kehr has been reprimanded by courts in the past for these exact types of impermissible opinions. A Westlaw search for opinions in which his testimony has been offered shows that the only two opinions addressing Mr. Kehr's expert opinion excluded it as offering improper legal conclusions.1 Del Webb Communities, Inc. v. Partington, 2007 WL 3053709 at *5-6 (D. Nev. Sept. 18, 2009) (holding Mr. Kehr's opinion inadmissible under Federal Rule of Evidence 702); People v. Reiner, 2004 WL 1171507 at *1 *11 (Cal. App. 2d Dist. May 26, 2004) (affirming the exclusion of Mr. Kehr's opinion that an attorney who was convicted of attempted extortion and conspiracy to commit extortion “acted in accordance with the law and was not guilty of any crime" as offering an “an improper opinion on an issue of law”). The Court should do so here as well.

Id. at 3:2-12. The Court should not entertain the Kehr Declaration here either for the same reasons.

III. CONCLUSION

Based on the foregoing objections, Plaintiff respectfully submits that the Court should

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strike paragraphs 1 through 5 of the Kehr Declaration.




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REQUEST FOR JUDICIAL NOTICE IN SUPPORT OF PLAINTIFF’S MOTION TO DISQUALIFY





Plaintiff,


Defendants.

CASE NO: BC501483 PLAINTIFF FRANK BROWN’S REQUEST FOR JUDICIAL NOTICE IN SUPPORT OFPLAINTIFF’S MOTION TO DISQUALIFY Assigned for all purposes to the Honorable John L. Segal (Dept. 50) [Plaintiff’s Reply in Further Support of Motion to Disqualify, Objections to Declarations of Joseph C. Sarles and Robert Kehr, and Response to Defendants’ Objections filed concurrently herewith] Hearing: Date: August 1, 2013 Time: 8:30 a.m. Dept.: 50 Action Filed: February 21, 2013 Trial Date: Not Assigned Yet

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Plaintiff Frank Reginald Brown, IV’s (“Plaintiff”) submits this Request for Judicial Notice

in support of his concurrently filed reply to Defendants’ Opposition to Motion to Disqualify the

Quinn Emanuel firm.

The Court may take judicial notice of the content of “[r]ecords of (1) any court of this state

or (2) any court of record of the United States or of any state of the United States.” Cal. Evid. Code

§§ 452(d), 453. California courts routinely take judicial notice of court proceedings. See, e.g.

People v. Lawley, 27 Cal. 4th 102, 116 n.2 & 163 n.24 (2002) (taking judicial notice of court files

and transcripts from another criminal case); People v. Moreno, 108 Cal. App. 4th 1, 4 n.4 (2003)

(taking judicial notice of record in prior appeal); PG&E Corp. v. Pub. Util. Comm’n, 118 Cal.

App. 4th 1174, 1220 n.38 (2004) (judicially noticing complaints filed against defendant in other

proceedings under Evidence Code § 452(d)); Oriola v. Thaler, 84 Cal. App. 4th 397, 403 & n.3

(2000) (judicially noticing transcript related to injunction proceeding).

Defendants therefore request that the Court take judicial notice of the following

documents:

1. Exhibit A is a true and correct copy of Objections to the Declaration of Robert L. Kehr

filed by Quinn Emanuel on May 3, 2010 in O’Shea, et al. v. Epson America, Inc. et al.,

Case No. CV – 09-8063 (CWx), in the United States District Court, Central District of

California [Doc. 128].

2. Exhibit B is a true and correct copy of a Motion to Disqualify Glaser Weil filed by

Quinn Emanuel on December 10, 2010 in Mattel, Inc. v. MGA Entertainment, Case No.

CV04-9049 (RNBx), in the United States District Court, Central District of California

[Doc. 9359].

3. Exhibit C is a true and correct copy a Reply in Support of Motion to Disqualify Glaser

Weil, filed by Quinn Emanuel on December 19, 2010 in Mattel, Inc. v. MGA

Entertainment, Case No. CV04-9049 (RNBx), in the United States District Court,

Central District of California [Doc.9416].

4. Exhibit D is a true and correct copy of Judge David O. Carter’s December 20, 2010

minute order granting Mattel’s Motion to Disqualify Glaser Weil in Mattel, Inc. v.

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MGA Entertainment, Case No. CV04-9049 (RNBx), in the United States District

Court, Central District of California [Doc. 9531].

5. Exhibit E is a true and correct copy of a Motion to Disqualify McKool Smith filed by

Quinn Emanuel on September 7, 2011in Packetvideo Corporation v. Spotify USA Inc.,

et al., Case No. 3:11-cv-1659 IEG WMc, in the United States District Court, Southern

District of California [Doc. 16].

6. Exhibit F is a true and correct copy of Judge Irma E. Gonzalez’s September 28, 2011

order granting the McKool Smith firm’s Motion to Withdraw in Packetvideo

Corporation v. Spotify USA Inc., et al., Case No. 3:11-cv-1659 IEG WMc, in the

United States District Court, Southern District of California [Doc. 32].




EXHIBIT A

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Case No. CV 09-8063 PSG (CWx) DEFENDANTS' OBJECTIONS TO THE DECLARATION OF ROBERT L. KEHR

QUINN EMANUEL URQUHART & SULLIVAN, LLP Shon Morgan (Bar No. 187736) [email protected] Ryan S. Goldstein (Bar No. 208444) [email protected] Valerie Roddy (Bar No. 235163) [email protected] 865 South Figueroa Street, 10th Floor Los Angeles, California 90017-2543 Telephone: (213) 443-3000 Facsimile: (213) 443-3100 Attorneys for Defendants Epson America, Inc., and Epson Accessories, Inc.

UNITED STATES DISTRICT COURT

CENTRAL DISTRICT OF CALIFORNIA

CHRISTOPHER O'SHEA, GISELE ROGERS and JEFF ADAMS, individuals, on behalf of themselves and all others similarly situated,

Plaintiffs,

vs. EPSON AMERICA, INC., a California corporation; EPSON ACCESSORIES, INC., a California corporation; and DOES 1-100, inclusive,

Defendants.

CASE NO. CV 09-8063 PSG (CWx) DEFENDANTS EPSON AMERICA, INC.'S AND EPSON ACCESSORIES, INC.'S OBJECTIONS TO THE DECLARATION OF ROBERT L. KEHR IN SUPPORT OF YUHL STONER CARR LLP'S OPPOSITION TO DEFENDANTS' MOTION TO DISQUALIFY PLAINTIFFS' COUNSEL Hon. Philip S. Gutierrez Date: May 17, 2010 Time: 1:30 p.m. Crtrm.: Roybal, 880

Filing Date: August 28, 2009

Case 2:09-cv-08063-PSG-CW Document 128 Filed 05/03/10 Page 1 of 5 Page ID #:4184

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-1- Case No. CV 09-8063 PSG (CWx) DEFENDANTS' OBJECTIONS TO THE DECLARATION OF ROBERT L. KEHR

Defendants Epson America, Inc. and Epson Accessories, Inc. ("Epson")

object to the Declaration of Robert L. Kehr in Support of Yuhl Stoner Carr LLP's

Opposition to Defendants' Motion to Disqualify Plaintiffs' Counsel ("Kehr

Declaration"). Epson hereby requests that the Court strike the portions of the Kehr

Declaration to which Epson objects.

I. THE KEHR DECLARATION OFFERS IMPROPER LEGAL

CONCLUSIONS

The Kehr Declaration improperly offers legal conclusions in paragraphs 3 and

4. Questions of law are for the Court's determination and are "inappropriate subjects

for expert testimony." Aguilar v. Int'l Longshoremen's Union Local No. 10, 966

F.2d 443, 447 (9th Cir. 1992) (affirming the exclusion of an expert who offered an

opinion about the reasonable and foreseeable reliance individuals would ascribe to

certain instructions); see Nationwide Transport Finance v. Cass Information

Systems, Inc., 523 F.3d 1051, 1058 (9th Cir. 2008) ("'[A]n expert witness cannot

give an opinion as to her legal conclusion, i.e., an opinion on an ultimate issue of

law.'" (quoting Hangarter v. Provident Life & Accident Ins. Co., 373 F.3d 998, 1016

(9th Cir. 2004))). Here, the Kehr Declaration limits itself to legal conclusions,

offering nothing in the way of analysis.

First, Mr. Kehr concludes that there is no conflict of interest between

plaintiffs' counsel's duties as Fabrice Commelin's agents and as counsel for the class.

(Kehr Decl. ¶ 3.a, at 3:21-22, 4:2-8, :18-19). Mr. Kehr is not offering an opinion

and analysis of specific conduct.

Second, there is no basis even for that legal conclusion insofar as the opinion

is predicated entirely on facts that do not exist here. Mr. Kehr's opinion is explicitly

based on an assumption that, if plaintiffs "were ordered" to act a certain way, that

order could trump the ethical violation currently being committed. (Kehr Decl.

¶ 3.a, at 4:2-8). Even if it may be true that a court can save a party from its ethical


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conflict with some type of order prohibiting certain conduct, there is no analysis of

what such an order would look like here and, in any case, there is no such order here

that would be of any avail to plaintiffs.

Third, Mr. Kehr concludes that solicitation of class members is legally proper.

(Kehr Decl. ¶ 3.b, at 4:24-25). Mr. Kehr does not offer any analysis of the specific

conduct of Yuhl Stoner in soliciting class members here, instead offering only a

summary of the general law on soliciting prospective class members. This

testimony is irrelevant to any issue raised by Epson's motion to disqualify. Epson

does not argue that the solicitation of prospective class representatives is generally

prohibited. Rather, Epson argued that Mr. Stoner acted unethically by using

confidential and privileged information provided to him by his client in one action

to solicit class plaintiffs for another prospective case, as confirmed by his use of an

internal Epson code name in his solicitation email.

Fourth, with respect to plaintiffs' counsel's email offering to sell out the

putative class for a good individual settlement for Mr. Commelin, Mr. Kehr only

offers his creative spin on the July 29, 2009 email. (Kehr Decl. ¶ 3.c, at 5:4-28).

The email speaks for itself. Mr. Kehr's interpretation of what the email "says" is not

a proper expert opinion. Rather, courts reject attempts to provide an opinion on how

a document would be reasonably understood by a reader. See Aguilar, 966 F.3d at

447 (opinion on how a worker would understand the letter rejected: "Here, the

reasonableness and foreseeability of the casual workers' reliance were matters of law

for the court's determination. As such, they were inappropriate subjects for expert

testimony.").

Fifth, Mr. Kehr's conclusion in Paragraph 4 that the facts, as assumed in his

declaration, "do not provide a basis for [Yuhl Stoner's] disqualification" is

impermissible. (Kehr Decl. ¶ 4, at 6:6). The disqualification of plaintiffs' counsel is

the ultimate legal issue for the Court and Mr. Kehr's opinion is improperly offering

an opinion on the "ultimate issue of law." Nationwide Transport Finance, 523 F.3d


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at 1058.

Mr. Kehr has been reprimanded by courts in the past for these exact types of

impermissible opinions. A Westlaw search for opinions in which his testimony has

been offered shows that the only two opinions addressing Mr. Kehr's expert opinion

excluded it as offering improper legal conclusions.1 Del Webb Communities, Inc. v.

Partington, 2007 WL 3053709 at *5-6 (D. Nev. Sept. 18, 2009) (holding Mr. Kehr's

opinion inadmissible under Federal Rule of Evidence 702); People v. Reiner, 2004

WL 1171507 at *1 *11 (Cal. App. 2d Dist. May 26, 2004) (affirming the exclusion

of Mr. Kehr's opinion that an attorney who was convicted of attempted extortion and

conspiracy to commit extortion "acted in accordance with the law and was not guilty

of any crime" as offering an "an improper opinion on an issue of law"). The Court

should do so here as well.

II. THE KEHR DECLARATION IS CONCLUSORY AND PROVIDES

INSUFFICIENT ANALYSIS

The conclusory analysis in Mr. Kehr's declaration prevents the Court from

analyzing the declaration based on Mr. Kehr's reasoning, therefore, paragraphs 3

and 4 of the Kehr Declaration should be stricken. The lack of analysis precludes the

Court from determining "if . . . the witness has applied the principles and methods

reliably to the facts of the case." Fed. R. Evid. 702. The Kehr Declaration lacks any

explanation of how Mr. Kehr concluded that certain conduct satisfies Yuhl Stoner's

ethical obligations.

1 This is based on a May 3, 2010 search run in the Westlaw "All Federal &

State Cases (ALLCASES)" database using the search terms: Robert /5 Kehr /250 expert.


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Conclusion

Based on these objections, Epson respectfully submits that the Court should

strike paragraphs 3 and 4 of the Kehr Declaration.

DATED: May 3, 2010 QUINN EMANUEL URQUHART & SULLIVAN, LLP

By /s/ Shon Morgan Shon Morgan

Attorneys for Defendants Epson America, Inc. and Epson Accessories, Inc.


EXHIBIT B

Case 2:04-cv-09049-DOC -RNB Document 9359 Filed 12/10/10 Page 1 of 25 Page ID #:282293

1 QUINN EMANUEL URQUHART & SULLIVAN, LLP John B. Quinn (Bar No. 090378)

2 john'[email protected] William C:1'rice (Bar No. 108542)

3 williamrrice@'1uinnemanuel.com) Michae T. Zeller (Bar No. 196417)

4 [email protected] 865 South Figueroa Street, 10th Floor

5 Los Angeles, California 90017-2543 Telephone: (213l443-3000

6 Facsimile: (213 443-3100

7 Attorneys for MatteI, Inc. and MatteI de Mexico, S.A. de C. V.

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SOUTHERN DIVISION

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20 Defendant.

21 AND CONSOLIDATED ACTIONS

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CASE NO. CV 04-9049 DOC (RNBx) Consolidated with Case Nos. CV 04-09059 & CV 05-02727

Hon. David O. Carter

MA'ITEL'S MOTION TO DISQUALIFY GLASER WElL

Hearing Date: Time: Place:

TBD TBD Courtroom 9D

Discovery Cutoff: Pre-trial Conference:

October 4, 2010 January 4, 2011 January 11 , 2011 Trial:

MA TTEL'S MOTION TO DlSOUALlFY GLA SER WElL


I TO ALL PARTIES AND THEIR COUNSEL OF RECORD:

2 PLEASE TAKE NOTICE that, on a date and at a time to be determined by

3 the Court, before the Honorable David O. Carter, plaintiffs Mattei, Inc. and Mattei

4 de Mexico, S.A. de C.V. (collectively, "Mattei") will, and hereby do, move the

5 Court for an order disqualifYing Glaser, Weil, Fink, Jacobs, Howard & Shapiro,

6 LLP ("Glaser Wei I") from representing MGA Entertainment, Inc., MGAE de

7 Mexico, S.R.L. de C.V., MGA Entertainment (HK), Ltd., and Isaac Larian

8 (collectively, "MGA") in this action.

9 This Motion is made pursuant to Cal. R. Prof. Condo 3-31O(E) and L.R. 83-

10 3.1.2 on the grounds that Glaser Wei! attorney Jill Basinger did prior work for

11 Mattei in this and another substantially related matter and has an indisputable

12 conflict of interest that must be imputed to the entire firm as a matter oflaw.

13 This Motion is based on this Notice of Motion and Motion, the

14 accompanying Memorandum of Points and Authorities, the Declaration of Michael

15 T. Zeller, the records and files of this Court, and all other matters of which the

16 Court may take judicial notice.

17 Certificate of Compliance

18 Lead counsel met and conferred regarding the issue in MatteI's motion on

19 December 8, 20 I 0 but did not reach a resolution.

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21 DATED: December 10,2010

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QUINN EMANUEL URQUHART & SULLIVAN. LLP

Bv lsi John B. Ouinn John B . Quinn Attorneys for MatteI, Inc. and MatteI de Mexico. S.A. de C.V.

-1-MATTEL'S MOTION TO DISQUALIFY GLASER WElL


I

2 3

TABLE OF CONTENTS

4 MEMORANDUM OF POINTS AND AUTHORITIES ............................................ . 1

5 PRELIMINARY STATEMENT.. ................................................................................ I

6 STATEMENT OF FACTS ........................................................................... .. ............. 1

7 LEGAL STANDARD ........................................ .. ...................................... .. ... ............. 3

8 ARGUMENT ................................................ .... .. ... ..... .... .... .. ... ... .... ...... .. ... ...... .. ......... .3

9 l. GLASER WElL HAS AN INCURABLE CONFLICT OF INTEREST ......... . 3

10 A. Ms. Basinger Obviously Has A Conflict.. ............................................... 3

I I B. Under California Law, the Conflict Is Imputed to Glaser Weil. ............ .4

12 II. NONE OF THE OTHER ARGUMENTS GLASER WEIL MAKES AGAINST DISQUALIFICATION IS PERSUASIVE, OR EVEN

13 RELEVANT .... .. .................... .. .......................................................................... 9

14 CONCLUSION ....... .............. .......... ......... ................................................................. II

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- )-

MATTEL'S MOTION TO DISQUALIFY GLASER WElL


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TABLE OF AUTHORITIES

Page

Cases

All Am. Semiconductor, Inc. v. Hynix Semiconductor, Inc., . No. C 07-1200, 2008 WI.. 5484552 (N.D. Cal. Dec. 18,2008) .............................. 5

City & Cnty. of San Francisco v. Cobra Solutions, Inc., 38 Cal. 4th 839 (2006) .................................................. ...... .................... ...... ...... 3, 4

Flatt v. Super. Ct., 9 Cal. 4th 275 (1994) ...................................................................................... 5, 6, 8

Fremont Indemn. Co. v. Fremont Gen. Corn., 143 Cal. App. 4th 50 (2d Dis!. 2006) ...................................................................... 3

Genetech, Inc. v. Sanofi-Aventis Deutschland GMGH, No. C 08-04909 SI (N.D. Cal. Mar. 20, 2010) ....................................................... 5

Glaxo Group Ltd. v. Genetech, Inc., No. SA 10-CV-2764-MRP (C.D. Cal. June 15, 2010) ...................................... .3, 6

Goldberg v. Warner/Chappell Music, Inc., 125 Cal. App. 4th 752 (2d Dis!. 2005) ................................................................ 4, 7

H.F. Ahmanson & Co. v. Salomon Bros., Inc., 229 Cal. App. 3d 1445 (2d Dist. 1999) .................................................................. .3

Henriksen v. Great A\ll. Say. & Loan, 11 Cal. App. 4th 109 (1st Dis!. 1992) .................................................... 3, 4, 5, 7, 8

Hitachi, Ltd. v. Tatung Co., 419 F. Supp. 2d 1158 (N.D. Cal. 2006) ........................ ................ .. ........ ...... ...... 2, 9

I-Enternrise Co. v. Draper Fisher Jurvetson Mgm!. CO. V, LLC, No. C-03-1561 MMC, 2005 WI.. 757389 (N.D. Cal. Apr. 4, 2005) ............ . 8, 9,10

Kirk v. First Am. Title Ins. Co., 183 Cal. App. 4th 776 (2010) ................................ .. .................... ........ .. .. .. .. ....... 6, 7

Largo Concrete v. Liberty Mu!. Fire Ins. Co., No. C 07-04651 CRE, 2008 WI.. 53128 (N.D. Cal. Jan. 2, 2008) ...................... 6, 9

Lucent Techs. Inc. v. Gateway, Inc., No. 02CV2060-B(CAB); 2007 WI.. 1461406 (S.D. Cal. May 15,2007) ....... 5, 6, 8

Meza v. H. Muehlstein & Co., 176 Cal. App. 4tJ:i 969 (2d Dis!. 2009) ................................................... 3, 4, 5, 7, 8

-11-MATTEL'S MOTION TO DISOUALIFY GLASER WElL


I Openwave Sys. v. 724 Solutions (US) Inc.,

2 No. C 09-3511 RS, 20 10 WL 1687825 (N.D. Cal. Apr. 22,2010) ..... ........ .. ... .. 6, 7

3 Pound v. DeMera DeMera Cameron, 135 Cal. App. 4th 70 (5th Dist. 2005) .... ..... .... .. .. .. ................ .................. ........ .3, 10

4 Rosenfeld Constr. Co. v. Super. Ct., 5 235 Cal. App. 3d 566 (1991) .. ... ........ .. ......... ....................................... ..... ............ . .4

6 Sham v. Next Entm't., Inc.,

7 163 Cal. App. 4th 410 (2d Dist. 2008) .. ..... ... ... ... .. .... ... ........ .. .. .... .. ... .. .... .... ..... ....... 5

8 UMG Recordings, Inc. v. MySpace, inc., 526 F. Supp. 2d 1046 (C.D. Cal. 2007) .. ..... .. .. .. ... ........ ..... .... ... .. ... .. ... .. ... ............... 6

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10 Other Authorities

II Cal. R. Prof. Conduct 3-3 IO(E) .. .. ...... ... .. .. ... ... ... .. ... .... .... .. .. .. ... .. ............ ...... .......... ...... 3

12 Don J. DeBenedictis, Bar Updates Rules, Nixes 'Screening' of Conflict Clients,

13 Los Angeles Daily Journal (July 27, 2010) ... ... ............... .......... ...... ........ .... ..... .. .... 7

14 Local Rule 83-3 .1.2 ....... .... ........ ... .. ... ..... ..... .. ...... .. ..... ......... .. .. .. ......... .. .... ..... ......... ...... 2 15

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I MEMORANDUM OF POINTS AND AUTHORITIES

2 Preliminary Statement

3 Glaser Wei! committed the cardinal sin under the disqualification cases-it

4 hired an attorney who worked on the other side of this very case. The lawyer in

5 question, Jill Basinger, billed over 1,400 hours to MatteI matters while at Quinn

6 Emanuel, including this case and another substantially related matter. No amount of

7 spin and no ethical wall can change the fact that disqualification of Glaser Weil is

8 required.

9 There is and can be no dispute that Ms. Basinger herself has a conflict.

10 Glaser Wei! has not asserted otherwise. And, as MGA's counsel itself proclaimed

11 in correspondence only last year (in the context of inaccurate accusations about prior

12 work by a Quinn Emanuel lawyer): "[A]n attorney's personal disqualification is

13 imputed to every attorney in the lawyer's office, as a matter of law, and the

14 presumption is not rebuttable." Glaser Wei!'s apparent view that California law has

15 somehow now shifted 180 degrees is incorrect. Ms. Basinger's incurable conflict is

16 attributable to the entire Glaser Wei! firm. Disqualification is required.

17 Statement of Facts

18 Jill Basinger is a 1997 law school graduate. She worked at Quinn Emanuel

19 Urquhart & Sullivan, LLP ("Quinn Emanuel") as a senior associate and Of Counsel

20 from 2002 to 2006. During her time at Quinn Emanuel, Ms. Basinger billed 1,473.1

21 hours to multiple Mattei matters. This included 9 hours billed directly to MatteI v.

22 MGA litigation. As part of her work on this matter, Ms. Basinger communicated

23 with Mike Zeller and reviewed confidential MatteI systems and files for potential

24 production.

25 In addition, Ms. Basinger billed 123.3 hours to Viveros v. MatteI, which

26 concerned the origins of MatteI's "Diva Starz" line of products, that overlapped in

27 issues and discovery with the MGA litigation. MGA itself has asserted that there is

28 a substantial relationship between the matters at issue in Viveros and this case by

-1-MATTEL'S MOTION TO DISOUALIFY GLASER WElL


1 asserting that MatteI's "Diva Starz" line was directly relevant to MGA's unclean

2 hands and competition privilege or justification defenses in this case.

3 MGA's Motion to Compel Further Responses to Requests for Production,

4 September 23 , 2009, at 20 (Dkt. No. 6816). As the Court will recall, MGA's

5 counsel repeatedly and specifically relied upon "Diva Starz" at the recent summary

6 judgment hearing for its statute of limitations and other arguments. While working

7 on Viveros, Ms. Basinger was privy to MatteI's litigation strategies with respect to

8 "Diva Starz" and protection of its intellectual property, regularly communicated

9 with in-house counsel for MatteI and was involved in the search for and collection

I 0 of documents concerning "Diva Starz." She also worked on, and discussed strategy

II regarding, the depositions of witnesses, including of persons who are witnesses in

12 both the MGA and the Viveros cases. MatteI's lead counsel in Viveros who

13 regularly communicated with Ms. Basinger on such and other privileged matters

14 was Mike Zeller, who is centrally involved as MatteI's counsel in the MGA

15 litigation. Indeed, the bulk of documents produced in the MGA litigation

16 concerning "Diva Starz," which were demanded by MGA, were collected and

17 reviewed as part of the Viveros case by Ms. Basinger, among other Quinn Emanuel

18 attorneys.

19 On November 24, 2010, MatteI was notified that Patricia Glaser of Glaser

20 Weil would be seeking to associate in as counsel for MGA in this matter. On

21 November 30, 2010, a Quinn Emanuel attorney familiar with the MatteI v. MGA

22 litigation learned that Ms. Basinger had joined Glaser Weil. On December 3, 2010,

23 MatteI sent Glaser Weil a letter, alerting it to the conflict. On December 6, 2010,

24 Glaser Weil responded, acknowledging that Ms. Basinger "may have" previously

25 worked for Mattei on this litigation. Glaser Weil claimed to have taken steps it

26 argued "preclude[ d] any imputation of a conflict" and asserted there was "no basis

27 for any objection by MatteI." Numerous meet and confers failed to convince Glaser

28 Weil to withdraw from representing MGA in this litigation.

-2-MATIEL'S MOTION TO DISQUALIFY GLASER WElL


I Legal Standard

2 Attorneys appearing before the United States District Court for the Central

3 District of California are subject to California law governing professional conduct.

4 L.R. 83-3.1.2 (All attorneys must "comply with the standards of

5 professional conduct required of members of the State Bar of California and

6 contained in the State Bar Act, the Rules of Professional Conduct ofthe State Bar of

7 California, and the decisions of any court applicable thereto."); Hitachi, Ltd. v.

8 Tatung Co., 419 F. Supp. 2d 1158, 1160 (N.D. Cal. 2006) ("Motions to disqualify

9 counsel are decided under state law."). Under California law, when an attorney has

10 worked on the other side ofa case, that severe conflict is imputed to the attorney's

II entire firm. Glaxo Group Ltd. v. Genetech, Inc., No. SA 10-CV-2764-

12 MRP, at 7 (C.D. Cal. June 15,2010), attached hereto as Exhibit 1; see also infra

13 Section I.B.

14 Argument 15 I,

16

GLASER WElL HAS AN INCURABLE CONFLICT OF INTEREST A, Ms. Basinger Obviously Has A Conflict

17 Pursuant to Rule 3-31 O(E) of the California Rules of Professional Conduct, an

18 attorney may not represent a new client whose interests are adverse to those of a

19 former client on a matter in which the attorney has obtained confidential

20 information. Cal. R. Prof. Conduct 3-31O(E); see also Henriksen v. Great Am. Sav.

21 & Loan, II Cal. App. 4th. 109, 113 (lst Dist. 1992). To obtain disqualification, the

22 former client is not required to show that the attorney actually possesses any

23 material confidential information; rather, it need establish only that the former

24 representation and the new representation are "substantially related." See id. at 114;

25 H.F. Ahmanson & Co. v. Salomon Bros" Inc., 229 Cal. App. 3d 1445, 1452 (2d

26 Dist. 1999) ("[I[t is well settled actual possession of confidential information need

27 not be proved in order to disqualify the former attorney."). If there is a "substantial

28 relationship" between the current representation and the former representation,



I access to confidential information is presumed, and disqualification is mandatory.

2 See Fremont Indemn. Co. v. Fremont Gen. Corp., 143 Cal. App. 4th 50, 67 (2d Dis!.

3 2006).

4 While a Quinn Emanuel associate and Of Counsel, Ms. Basinger worked not

5 only on related matters-she worked on this very litigation. An attorney who

6 switches sides during a pending litigation is disqualified automatically. See,!h&.

7 City & Cnty. of San Francisco v. Cobra Solutions, Inc., 38 Cal. 4th 839, 846 (2006)

8 ("An attorney may not switch sides during pending litigation representing first one

9 side and then the other."); Meza v. H. Muehlstein & Co., 176 Cal. App. 4th 969, 978

10 (2d Dis!. 2009) (attorney's prior representation of adverse party in the very same

11 suit was a per se conflict of interest); Pound v. OeMera OeMera Cameron, 135 Cal.

12 App. 4th 70, 76 (5th Dis!. 2005) (switching sides in the same action is 'the most

13 egregious conflict of in teres!."') (citation omitted). Glaser Wei! cannot, and does

14 not, dispute that Ms. Basinger is disqualified from representing MGA in this action. I

IS B. Under California Law, the Conflict Is Imputed to Glaser Weil

16 In California, an attorney's individual conflict of interest is imputed to her

17 firm because "attorneys, working together and practicing law in a professional

18 organization, share each other's, and their clients, confidential infonnation." Cobra

19 Solutions, Inc., 38 Cal. 4th at 847-48; W also Rosenfeld Constr. Co. v. Super. C!.,

20 235 Cal. App. 3d 566, 573 (1991 )("It has long been recognized . .. that knowledge

21 by any member of a law firm is knowledge by all of the attorneys in the firm,

22 partners as well as associates."). As MGA's counsel put it in a letter to MatteI last

23 year, "an attorney's personal disqualification is imputed to every attorney in the

24 lawyer's office, as a matter of law, and the presumption is not rebuttable." The

25 vicarious disqualification rule is based on "a pragmatic recognition that the

26 27 I Glaser Wei! apparently recognized Ms. Basinger's conflict in attempting to

construct an ethical wall around her. 28

-4-MA TTEL'S MOTION TO DISQUALIFY GLASER WElL


confidential information will work its way to the nontainted attorneys at some

2 point." Goldberg v. Warner/Chappell Music, Inc., 125 Cal. App. 4th 752, 765 (2d

3 Dist. 2005).

4 Vicarious disqualification of the entire firm is compelled where, as here, an

5 attorney's disqualification results from her prior work for the opposing side in the

6 same lawsuit. See Meza, 176 Cal. App. 4th at 978 ("As a general rule in California,

7 where an attorney is disqualified from representation, the entire law firm is

8 vicariously disqualified as well. This is especially true where the attorney's

9 disqualification is due to his prior representation of the opposing side during the

10 same lawsuit."); Henriksen, 11 Cal. App. 4th at 117 ("Where an attorney is

11 disqualified because he formerly represented and therefore possesses confidential

12 information regarding the adverse party in the current litigation, vicarious

13 disqualification of the entire firm is compelled as a matter oflaw."); Flatt v. Super.

14 Ct., 9 Cal. 4th 275, 283 (1994) (citing Henriksen with approval for the same

15 proposition); Lucent Techs. Inc. v. Gateway, Inc., No. 02CV2060-B(CAB), 2007

16 WL 1461406, at *2 (S.D. Cal. May 15, 2007) ("California courts have applied an

17 automatic or per se disqualification of the firm especially where the conflict

18 involves the representation of adverse parties.").

19 In correspondence, Glaser Wei! has asserted that its creation of an "ethical

20 wall" between Ms. Basinger and the attorneys who propose to handle this case

21 insulates it from disqualification. This is not the law. For several decades,

22 California state and federal district courts have treated the rule of vicarious

23 disqualification as absolute and irrebutable---as MGA's own counsel conceded in

24 correspondence in 2009.

25 In Henriksen v. Great Am. Savings & Loan, 11 Cal. App. 4th 109 (1st Dist.

26 1992), for example, an attorney who had previously represented defendants in

27 ongoing litigation joined the firm that was representing the plaintiffs. Although the

28 firm implemented an eihical wall between the tainted attorney and the lawyers

-5-MA ITEL'S MOTION TO DISQUALIFY GLASER WElL


I handling the case, the court held that disqualification of the entire firm was

2 mandatory. Id. at 114-15. Numerous other cases have reached the same result. See,

3 Meza, 176 Cal. App. 4th at 978-80 (ethical wall between an attorney with

4 confidential information who switched sides in the same lawsuit did not prevent

5 disqualification of entire firm); Sharp v. Next Entm't" Inc., 163 Cal. App. 4th 410,

6 438 n. 11 (2d Dist. 2008) ("[I]n the context of private law firms, there is no

7 definitive California authority authorizing ethical walls."); Genetech, Inc. v. Sanofi-

8 Aventis Deutschland GMGH, No. C 08-04909 SI, at 12-13 (N.D. Cal. Mar. 20,

9 2010) (disqualifying entire finn even though it submitted affidavits stating that the

10 tainted attorney was semi-retired and had not been involved in the litigation at

11 issue); All Am. Semiponductor, Inc. v. Hynix Semiconductor, Inc., No. C 07-1200,

12 2008 WL 5484552, at *8-9 (N.D. Cal. Dec. 18,2008) (attorney's prior

13 representation of corporate officer at previous firm disqualified entire new firm from

14 representation adverse to corporation in related matter, despite timely creation of

15 ethical wall and geographical separation of attorneys); Largo Concrete v. Liberty

16 Mut. Fire Ins. Co., No. C 07-04651 CRE, 2008 WL 53128, at *4-5 (N.D. Cal. Jan.

17 2,2008) (plaintiffs' counsel was disqualified even though firm screened off

18 associate who worked on substantially related matters for defendant at previous

19 firm); Lucent, 2007 WL 1461406, at *4-5 (ethical walls are ineffective); UMG

20 Recordings, Inc. v. MySpace, Inc., 526 F. Supp. 2d 1046, 1060-61 (C.D. Cal. 2007)

21 (Flatt requires automatic disqualification of entire firm).

22 Glaser Wei! apparently plans to argue that the California Court of Appeal's

23 recent decision in Kirk v. First Am. Title Ins. Co., 183 Cal. App. 4th 776 (2010),

24 effected a sea-change in California disqualification law. Glaser Wei! is mistaken.

25 In Kirk, the Second District became the first California court to hold that, under

26 certain circumstances, the presumption of vicarious disqualification can be rebutted

27 by an ethical wall at a private law firm. Id. at 806-810. Any argument by Glaser

28 Wei! that California's well-established rule of imputed disqualification was

-6-MA TIEL'S MOTION TO DISQUALIFY GLASER \VEIL


I jettisoned by a single, nonbinding decision of the Court of Appeal would be sorely

2 misplaced, as recognized by this District earlier this year in Glaxo Group Ltd. v.

3 Genetech, Inc., No. SA IO-CV-2764-MRP (C.D. Cal. June 15, 2010). In Glaxo, the

4 court rejected the plaintiff's attempt to rely on Kirk for the proposition that an

5 ethical screen can refute the presumption of an imputed conflict. /d. at 7 ("GSK

6 cannot rely on Kirk because it is not binding authority and contradicts binding

7 California Supreme Court law. See Flatt, 9 Cal. 4th at 283."); see also Qpenwave

8 Sys. v. 724 Solutions (US) Inc., No. C 09-3511 RS, 2010 WL 1687825, at *5 n.6

9 (N.D. Cal. Apr. 22, 2010) (rejecting ethical walls and noting that Kirk is a

10 nonbinding appellate decision).

II Further, in July 2010, the California State Bar rejected the very rule proposed

12 by Glaser Wei!, that ethical walls may screen out conflicted lawyers; this further

13 shows that Kirk is an outlier-not, as Glaser Wei! suggests, established law in

14 California. Don J. DeBenedictis, Bar Updates Rules, Nixes 'Screening' Of

15 Conflict Clients, Los Angeles Daily Journal (July 27, 2010).

16 Even assuming that Kirk were the law, it would not save Glaser Wei! here .. In

17 Kirk, the "tainted" attorney had already left the firm whose representation was being

18 challenged. See Kirk, 183 Cal. App. 4th at 815-16. That fact is highly significant,

19 because "[w]here tainted attorneys and nontainted attorneys are working together at

20 the same firm, there is ... a pragmatic recognition that the confidential information

21 will work its way to the nontainted attorneys at some point," but when the tainted

22 attorney is gone, the court can conduct a "dispassionate assessment of whether

23 confidential information was actually exchanged." See Goldberg, 125 Cal. App. 4th

24 at 765 (emphasis added and internal quotation marks and citation omitted). By

25 contrast, Ms. Basinger is currently at Glaser Weil; there is no way to ensure

26 preservation of Matlel's confidences other than through vicarious disqualification.

27 See id.; Henriksen, II Cal. App. 4th at 114-15; Meza, 176 Cal. App. 4th at 978-80;

28 Openwave, 2010 WL 1687825, at *5 (refusing to extend Kirk to permit the use of an

-7-MATIEL'S MOTION TO DISQUALIFY GLASER WElL


1 ethical wall for existing attorney in light of the substantial relationship between

2 matters).

3 Even Kirk recognizes that in an egregious case such as this one, where an

4 attorney worked on the other side ofthe same litigation, an ethical wall cannot

5 "cure" the conflict. See Kirk, 183 Cal. App. 4th at 800 & n.20 ("[V]icarious

6 disqualification should be automatic in cases of a tainted attorney possessing actual

7 confidential information from a representation, who switches sides in the same

8 case."); see also Openwave, 2010 WL 1687825, at *5 (although Kirk may have

9 "arguably" broken some new ground, "[t]his Court would have to break far more

1 0 new ground ... to disregard its conclusion that there is a substantial relationship

11 between the [prior representation] and this action, and not [vicariously] disqualify

12 [the firm] under the facts here").

13 No state or district court in California has ever suggested an ethical wall could

14 overcome vicarious disqualification under the circumstances of this case.

15 Lucent, 2007 WL 1461406, at *4 ("[N]o district court cases in the Ninth Circuit

16 have permitted the presumption to be rebutted where the conflict was generated in

17 the context of a single litigation"); I-Enterprise Co. v. Draper Fisher Jurvetson

18 Mgmt. Co. V, LLC, No. C-03-1561 , 2005 WL 757389, at *6 (N.D. Cal. Apr. 4,

19 2005) (same); Flatt, 9 Cal. 4th at 283 ("If an attorney is disqualified because he

20 formerly represented and therefore possesses confidential information regarding the

21 adverse party in the current litigation, vicarious disqualification of the entire firm is

22 compelled as a matter oflaw); Henriksen, 11 Cal. App. 4th at 117 (same); Meza,

23 176 Cal. App. 4th at 979 (an ethical screen will not preclude disqualification of

24 entire firm, especially where the attorney's conflict is due to prior representation of

25 adverse party in the same matter).

26

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-8-MA TTEL'S MOTION TO DISQUALIFY GLASER WElL


I II. NONE OF THE OTHER ARGUMENTS GLASER WElL MAKES

2 AGAINST DISOUALIFICATION IS PERSUASIVE, OR EVEN

3 RELEVANT 4 Glaser Weil's correspondence alludes to several other arguments that Glaser

5 Weil apparently intends to make to avoid disqualification. None of these is

6 sufficient to avoid disqualification of the Glaser Weil firm:

7 • Glaser Weil represented MGA in this action "in the past" - Glaser Weil

8 previously represented MGA in this action, withdrew before the Phase l.A. trial, and

9 then appeared briefly after that trial, withdrawing again in 2009. That Glaser Weil

10 represented MGA in this action before it had a conflict does not in any way support

II the position that Glaser Weil may resume the representation now that it has a

12 conflict. Courts routinely disqualify firms that have represented clients for years

13 when a tainted attorney joins the firm. See supra pp. 4-8.

14 • Jim Asperger "represented MGA at O'Melveny & Myers" - This

IS statement is irrelevant and simply false. Mr. Asperger, a white collar partner,joined

16 Quinn Emanuel in 2009. Unlike Ms. Basinger, he did no work on MGA v. Mattei,

17 and there is and can be no suggestion that Mr. Asperger has any MGA confidential

18 information that is relevant to this case. Prior correspondence confirms this.

19 • Glaser Weil hired Ms. Basinger "from the firm of McDermott. Will &

20 Emery, not Quinn Emanuel" - So what? Disqualification is mandatory if there is a

21 substantial relationship between the former and current representations. See supra

22 Section l.A. It does not matter whether, after obtaining MatteI's material

23 confidences, Ms. Basinger worked at other firms before joining Glaser Wei!.

24 • Ms. Basinger "may have had a limited role in Mattei matters as a low-

25 level associate many years ago" - In reality, Ms. Basinger was a senior associate

26 and Of Counsel, a 5- to 9-year lawyer for Mattei, not a "low-level associate." Ms.

27 Basinger billed over 1,400 hours to Mattei matters, including this litigation and

28 another substantially related matter, during that period. Id. Work by associates far

-9-MA TIEL'S MOTION TO DISOUALIFY GLASER WElL


1 junior to Ms. Basinger, or who billed fewer hours, has supported disqualification

2 orders. I-Enterprise, 2005 WL 757389, at *6 (disqualification of entire

3 firm because it hired attorney who billed one-half hour to the same litigation prior to

4 switching firms); Hitachi, 419 F. Supp. 2d at 1159-61 (ordering disqualification of

5 entire firm, despite claim that associate's prior work for other side on a related

6 matter was "primarily document review" and despite ethical wall); Largo, 2008 WL

7 53128, at *1-5 (disqualification of entire firm despite claim that transferring

8 associate performed 9.8 hours of work as essentially "a paralegal" in a related

9 matter, despite associate's testimony that he did not review anything that would be

10 of use in the pending litigation, and despite ethical wall); Pound, 135 Cal. App. 4th

11 at 80 (attorney associated into case who had a one-hour meeting with counsel for the

12 other side three years earlier required vicarious disqualification of firm).

13 • "There had already been a trial ... when we hired" Ms. Basinger -

14 That the Phase I.A trial occurred in 2008 is irrelevant. There is no rule permitting

15 tainted law firms to participate in subsequent trials notwithstanding disabling

16 conflicts. I-Enterprise, 2005 WL 757389, at *8 (although the remedy of

17 disqualification "is a harsh one, particularly when it comes late in the litigation," no

18 case has denied qualification on grounds of prejudice or expense). The same

19 analysis applies; no matter what the stage of the case, Glaser Weil should be

20 disqualified because it decide to hire an attorney who had represented MatteI on

21 substantially related matters, including work on the other side of this very case.

22 The inapplicable and irrelevant arguments proffered by Glaser Wei! in its

23 correspondence only confirm what the law requires: Glaser Weil should be

24 disqualified because it chose to bring in an attorney who had worked on the other

25 side of this case. No amount of "walls" or excuses can save Glaser Weil from this

26 legally required result.

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-10-MAITEL'S MOTION TO DlSOUALIFY GLASER WElL


Conclusion

2 For the foregoing reasons, Mattei respectfully requests that the Court

3 grant its motion to disqualifY Glaser Weil from representing MGA in this litigation.

4

5 DATED: Decemher 10, 2010

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QUINN EMANUEL URQUHART & SlJLLIV AN. LLP

Bv Is! Joho B. Quinn John B. Quinn Attorneys for Mattei, Inc. and Mattei de Mexico. S.A. de C.V.

-1 1-MATTEL'S MOTION TO DISQUALIFY GLASER WElL


Exhibit 1

EXHIBIT /

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I I GLAXO GROUP LIMITED, ET AL.,

12 Plaintiff, 13

14

v. GENENTECH, INC., ET AL.,

Defendant. IS 11--------------------------

Case No. SA 10·CV·2764·MRP (FMOx)

ORDER RE: MOTION TO DISOUALIFY COUNSEL FOR PLAINTIFFS

16 I. INTRODUCTION

17 Plaintiffs Glaxo Group Limited and GlaxoSmithKline LLC (collectively, "GSK")

I 8 seek declaratory judgment against Genentech, lnc. ("Genentech") and City of Hope

I 9 (collectively, "Defendants") that U.S. Patent No. 6,33 1,41 5 (the "Cabilly II patent") is

20 invalid, unenforceable and not infringed by the manufacture, use, sale, offer to sell , or

21 importation ofGSK's Arzerra™ antibody product. Complaint I. Arzerra™ is a human

22 monocolonal antibody that was approved by the U.S. Food and Drug Administration for

23 the treatment of chronic lymphocytic leukemia patients. Complaint 27,30; Answer 27,

24 30.

25 Genentech brought a motion to disquali fy Howrey LLP ("Howrey") from this case

26 because Henry Bunsow, a partner at Howrey, represented Genentech in a case that is

27 alleged to be substantially related to th is case.

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·1· Exhibit.---,,-'/,:::-__ page-J.!_ ·'-.1 __


II. BACKGROUND

2 A. Background of the Cabilly I and Cabilly II Patents

3 On April 3, 1983, Shmuel Cabilly et al. filed a patent application that issued on

4 March 28,1989 as U.S. Patent No. 4,816,567 (the "Cabilly I patent"). Complaint ,13;

5 Answer The Cabilly! patent was assigned to Defendants. Complaint Answer

6 At the time the Cabilly I patent issued, Defendants had a continuation application

7 pending that later issued as the Cabilly II patent. Complaint Answer '14.

8 Cell tech Therapeutics Ltd. ("Celltech") is the owner of U.S. Patent No. 4,816,397

9 (the "Boss patent"), which has a priority date of March 25,1983. Complaint

10 Answer Defendants copied claims from the Boss patent, as is standard practice,

lIto initiate an interference proceeding to detennine whether the Boss patentees or the

12 Cabilly patentees were entitled to priority for the inventions claimed in the respective

13 patents. Complaint ,14; Answer ,14. In February 1991, the U.S. Patent and Trademark

14 Office ("PTO") Board of Patent Appeals and Interferences ("the BPAI") declared a

15 patent interference between the pending Cabilly II patent application and the Boss patent.

16 Complaint Answer Seven years later, in August 1998, the BPA! found that the

17 Boss patentees were entitled to priority over the Cabilly patentees. Complaint ,15;

18 Answer see Cabilly v. Boss, 55 U.S.P.Q.2d 1238 (B.P.A.1. 1998).

19 In October 1998, Genentech filed an action under 35 U.S.C. § 146 against Celltech

20 to appeal the decision of the BPAI awarding priority to the Boss patent (the "Celltech

21 case"); the parties later settled the case in March 2001 pursuant to a confidential

22 settlement agreement. Complaint ,-r16; Answer ,-r16; Genentech, Inc. v. Cel/tech

23 Therapeutics Ltd., Case No. C98-3926 (N.D. CaL). Pursuant to Celltech and

24 Genentech's confidential settlement agreement, the court ordered the PTO to vacate its

25 BPAI decision in the interference case, revoke the Boss patent, and grant the Cabilly II

26 patent. Genentech, Inc. v. Celltech Therapeutics. Ltd., 2001 U.S. Dist. LEXIS 3489, at

27 *7-9 (N.D. Cal. Mar. 16,2001). Although the PTO refused to act in response to the

28

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court's order, subsequent proceedings resulted in the issuance of the Cabilly II patent on

2 December 18, 200!.

3 B. Background of the Chi ron Case

4 Chiron Corp. filed a patent infringement case against Genentech on June 7, 2000

5 ("the Chiron case"). Chiron Corp. v. Genentech Inc., Case No. 8-00-1252 (ED. Cal.).

6 Notably, the Chiron case was filed less than two years after the BPAI decision in the

7 interference case between the Cabilly II patent application and the Boss patent. While

8 the Chiron case was pending, the Cell tech case settled, resulting in the issuance of the

9 Cabilly II patent in 200 I. As a continuation of the Cabilly I patent, the Cabilly II patent

10 shares a specification with the Cabilly I patent.

11 A jury trial in the Chiron case took place in August and September of 2002.

12 Chiron Corp. v. Genentech Inc., Civ. 8-00-1252 (ED. Cal.). G8K and Genentech

13 dispute how the Cabilly I patent was used in the Chiron case. The Court understands that

14 the Cabilly I patent was used in the Chiron case as follows: In its summary judgment

15 order in the Chiron case, the court declared that the Cabilly I patent disclosed chimeric

16 antibodies in 1983. Chiron Corp. v. Genentech, Inc. , 268 F. 8upp. 2d 1148, 1157 (E.D.

17 Cal. 2002). In the Chiron trial, Genentech used the Cabilly I patent to support its

18 argument that Chiron did not enable or adequately describe chimeric or hybrid antibodies

19 as claimed in the patent at issue ("the Ring patent"). Garner Decl., Ex. B. at 3-5; Nathan

20 Decl., Ex. F at 000138-39, Ex. G at 000178-79, Ex. H.

21 Bunsow was one of three lawyers ofKeker & Van Nest LLP to appear and argue

22 at trial on behalf of Genentech in the Chiron case. See Nathan Decl., Ex. I at 000192.

23 Bunsow examined witnesses at trial to support the argument that Chiron did not

24 adequately enable or adequately describe chimeric or hybrid antibodies in the patent at

25 issue. See Nathan Decl., Ex. I at 000194. Prior to trial in the Chiron case, Bunsow

26 defended the depositions of Sean Johnston, Genentech's General Counsel, and Wendy

27 Lee who prosecuted the Cabilly II patent. Nathan Decl., Ex. C-D. Bunsow is now a

28 member of Howrey, the finn hired by GSK in this case. Howrey began to represent GSK

-3-EXhibil--;--:;:/:c-__ Page /)'


in this case on or about January 27, 2010, and later imposed an ethical screen on Bunsow

2 on or about March II, 2010. Day Decl. ,3; O'Brien Decl. ,5.

3 1II. THE LEGAL STANDARD

4 Under Central District Local Rule 83-3.1.2, each attorney must comply with "the

5 standards of professional conduct required of members of the State Bar of California and

6 contained in the State Bar Act, the Rules of Professional Conduct of the State Bar of

7 California, and the decisions of any court applicable thereto." According to California

8 Rule of Professional Conduct 3-31O(E), absent a written waiver from the client or fonner

9 client, an attorney must not "accept employment adverse to the client or fonner client

10 where, by reason of the representation of the client or fonner client, the member has

II obtained confidential infonnation material to the employment." When a former client

12 seeks to disqualify a fonner attorney from representing an adverse party, the former clien

13 need not prove actual possession of confidential inforrnation by the former attorney;

14 instead, courts presume possession of confidential information if there is a "substantial

15 relationship between the fonner and current representation." H. F. Ahmanson & Co. v.

16 Salomon Bros., 229 Cal. App. 3d 1445, 1452 (1991)(citing Global Van Lines v. Superior

17 Court, 144 Cal. App. 3d 483, 489 (1983» (internal quotation omitted). "The 'substantial

18 relationship ' test mediates between two interests that are in tension in such a context-

19 the freedom of the subsequent client to counsel of choice, on the one hand, and the

20 interest of the fonner client in ensuring the permanent confidentiality of matters disclose

21 to the attorney in the course of the prior representation, on the other." Flatt v. Superior

22 Court, 9 Cal. 4th 275, 283 (1994).

23 The substantial relationship test requires that the fonner client "demonstrate a

24 'substantial relationship' between the subjects of the antecedent and current

25 representations." Id. The subject of the representations includes infonnation material to

26 "the evaluation, prosecution, settlement or accomplishment of the litigation or transaction

27 given its specific legal and factual issues." Jessen v. Hartford Casualty Ins. Co., III Cal.

28 App. 4th 698, 713 (2003). After a substantial relationship has been shown to exist,

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"courts ask whether confidential information material to the current dispute would

2 normally have been imparted to the attorney by virtue of the nature of the former

3 representation." Ahmanson, 229 Cal. App. 3d at 1454. It is reasonable to expect that

4 "the attorney may acquire confidential information about the client or the client's affairs

5 which may not be directly related to the transaction or lawsuit at hand but which the

6 attorney comes to know in providing the representation to the fonner client with respect

7 to the previous lawsuit or transaction." Jessen, III Cal. App. 4th at 712. In presuming

8 what confidential information material to the current dispute was likely disclosed to the

9 attorney, "the court should not allow its imagination to run free with a view to

10 hypothesizing conceivable but unlikely situations in which confidential information

11 'might' have been disclosed which would be relevant to the present suit." Talecris

12 Biotherapeutics, Inc. v. Baxter Int'l, Inc. , 491 F. Supp. 2d 510, 515 (D. Del. 2007)

13 (citation omitted).

14 When a substantial relationship between the former and current representation by

15 an attorney is established, not only is the attorney disqualified, but the disqualification

16 extends vicariously to the attorney's law firm. Flatt, 9 Cal. 4th at 283.

17 IV. DISCUSSION

18 The Court first considers whether there is a substantial relationship between the

19 subjects of representation in the Chiron case and this case. The subject of the

20 representation is understood to be broader than the witnesses Bunsow prepared and the

21 documents that Bunsow introduced into evidence on behalf of Genentech in the Chiron

22 case. The subject of Buns ow's representation includes the "the evaluation, prosecution,

23 settlement or accomplishment of the litigation or transaction given its specific legal and

24 factual issues." Jessen, 111 Cal. App. 4th at 713. The subject of evaluating and

25 prosecuting the Chiron case included an understanding of the Cabilly I patent and how it

26 related to Genentech's arguments on enablement and written description. To present

27 testimony at trial regarding the Cabilly I patent, Bunsow had to be reasonably acquainted

28 with the Cabilly I patent and its specification such that he could prepare witnesses,

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defend their depositions, and examine them at trial on the subject of the Cabilty I patent.

2 aSK would have the Court believe that because Cabilly II was not at issue in the Chiron

3 case, there is no substantial relationship between the subjects of representation in the

4 Chiron case and this case. However, because the specifications ofthe Cabilly I and

5 Cabilly II patents are the same and because the specification of a patent is the basis for

6 the claims, there is a relationship between the subjects of representation in these cases.

7 Furthennore, because the Celltech case involving the Cabilly 11 patent application was

8 being simultaneously litigated, a trial attorney employing the Cabilly I patent to attack th

9 validity of the Ring patent in the Chiron case could hardly have failed to be cognizant of

10 the strategy in the Cell tech case. Bunsow's representation of Genentech in the Chiron

11 case would necessarily have resulted in an evaluation of the Cabilly I in light of the

12 Cabilly II patent. Therefore, the Court finds that there is a substantial relationship

13 between the subjects of representation in the Chiron case and this case.

14 Next, after evaluating the scope of the prior representation, courts inquire what

15 confidential information would have been imparted to an attorney given the scope of that

16 representation. See Ahmanson, 229 Cal. App. 3d at 1454. As stated, it is reasonable to

17 presume that Bunsow-a member of a three person trial team in the Chiron case with

18 important responsibilities such as defending the deposition of the Genentech General

19 Counsel and patent prosecutor of the Cabilly II patent-acquired confidential information

20 about Genentech's patent strategy surrounding the Cabilly I and Cabilly II patents. Give

21 that the Cabilly I and Cabilly II patents shared a specification and Genentech was

22 simultaneously litigating the Celltech case, it would have certainly been important that

23 nothing in the Chiron case defense strategy impair Genentech's ability to enforce and

24 defend the Cabilly II patent. To act as competent counsel to Genentech, Bunsow would

25 have to have acquired confidential information material to this case. It could hardly have

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-6-EXhibil_"I".-__ page_/'-f=--__


been otherwise, especially considering the importance and value of the Cabilly I and 2 Cabilly n patents. I

3 GSK cites Kirk v. First American Title Insurance Company for the proposition

4 that the presumption of an imputed conflict can be rebutted by adequately screening a

5 lawyer from those at the firm representing the adverse party. 183 Cal. App. 4th 776

6 (2010). However, GSK cannot rely on Kirk because it is not binding authority and

7 contradicts binding California Supreme Court law. See Flatt, 9 Cal. 4th at 283 ("Where

8 the requisite substantial relationship between the subjects of the prior and the current

9 representations can be demonstrated .. , disqualification of the attorney's representation

10 of the second client is mandatory; indeed, the disqualification extends vicariously to the

I I entire finn."), Even if the Court were to follow Kirk, GSK would not be able to rebut the

12 presumption of an imputed conflict because it did not adequately screen Bunsow from

13 this case. Kirk states than an effective screen must "be timely imposed" and impose

14 "preventative measures to guarantee that infonnation will not be conveyed," Id. at 810.

15 Here, it is clear that Howrey did not impose the screen at the time the representation

16 began on or about January 27, 20 I 0, but only imposed the screen at the time Genentech

17 raised the conflict to Howrey's attention on or about March 11 , 2010. Day Decl. 3;

18 O'Brien Decl. Howrey's screen does not meet the "timely imposed" requirement

19 under Kirk because the screen was imposed weeks after the representation began,

20 Genentech objects to Howrey's declaration from Professor David C. Hricik on the

21 groWlds that his opinions state legal conclusions and lack foundation. This Court

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27 28

I "[T]he court should not allow its imagination to run free with a view to hypothesizing conceivable but unlikely si tuations in which confidential infonnation 'might' have been disc losed which would be relevant to the present suit." Talecris Biotherapeutics, Inc. v. Baxter Int'l, Inc., 491 F, Supp, 2d at 515 (citation omined). Beatuse this Court has deep experience with the Cabilly II patent and its history as a continuation of the Cabilly I patent, this Court is well situated to make a presumption about what confidential information would have been necessary to execute the trial strategy in the Chiron case. This Court has handled two notable cases involving the Cabilly II patent. In Medlmmune, a licensee of the Cabi lly II patent brought a declaratory relief action seeking to have the Cabi l1y "patent declared infringed, invalid, and unenforceable. See MedImmune, Inc. v. Genentech, Inc., No. 2:03-cv-02567 (C.O. Cal, filed Apr. II, 2003), The case settled after years oflitigation that included extensive discovery, claim construction, an appeal, and a decision by the United States Supreme Court, In Centocor, another licensee of the Cabilly II patent filed a declaratory relief action raising the same claim construction, validity, and enforceabi lity issues. See Centocor Inc. v, Genentech, Inc., No. 2:08-cv-03573 (C.O. Cal. filed May 30, 2008).

-7-Exhibit ---;-::;----Page /7

/


declines to address Genentech's objection. Because Prof. Hricik did not discuss the 2 Celltech case and its relationship to the Cabilly I and Cabilly II patents and the Chiron

3 case, the Court places little weight on Prof. Hricik's declaration. Prof. Hricik is

4 obviously unaware of the extraordinary history of the Cabilly I and II patents.

5 Because the Court finds a substantial relationship between Bunsow's fonner

6 representation of Genentech and Howrey's current representation ofGSK, the Court

7 GRANTS Genentech's motion to disqualify Howrey from the representation ofGSK in

8 this case. Although the Court finds Genentech's arguments that the use of evidence on 9 Herceptin in the Chircn case and this case result in a substantial relationship, the Court

10 declines to address Herceptin given its finding of a substantial relationship for the reason II set forth above. The Court further declines to address Genentech's arguments on the

12 violation of the duty of loyalty although in this case it is undisputed that Howrey intends 13 to make a full scale attack on the Cabilly II patent on multiple grounds including written 14 description and enablement.

IS v. CONCLUSION

16 The Court GRANTS Genentech's motion to disqualify Howrey from this case.

17 The Court ORDERS Howrey to refrain from handing over its work product to successor 18 counsel unti l further order of this Court. The Court ORDERS Genentech to prepare a

19 proposed Statement of Uncontroverted Facts and Conclusions of Law and proposed 20 Order in light of the foregoing and submit it to the Court by Friday, June 25, 2010.

21 IT IS SO ORDERED.

22

23 DATED:June IS, 2010

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Hon. Mariana R. Pfaelzer United States District Judge

·8· EXhibill_=I __ _

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QUINN EMANUEL URQUHART & SULLIVAN, LLPJohn B. Quinn (Bar No. 090378)Johnquinn^qulnnemanuel.comWilliam C. rice (Bar No. 108542)williamprice(a^qumnemanuel.comMichael T. Zeller Bar Na. 19641 )michaelzel l er@qumnemanuel. com

865 South Figueroa Street, 10th FloorLos Angeles , California 90017-2543Telephone : (213) 443-3000Facsimile : (213) 443-3100

Attorneyys for Mattel, Inc. andMattel de Mexico , S.A. de C.V.



SOUTHERN DIVISION

MATTEL, INC., a Delaware CASE NO. CV 04-9049 DOC (RNBx)corporation, Consolidated with

Case Nos CV 04-09059 & CV OS-

vs.

02727Plaintiff,

Hon. David O. Carter

REPLY IN SUPPORT QF MOTIONTO DISQUALIFY GLASER WEIL

MGA ENTERTAINMENT, INC., aCalifornia corporation, et al.,

Defendant.

AND CONSOLIDATED ACTIONS

Hearing Date: TBDTime: TBDPlace: Courtroom 9D

Discovery Cutoff: October 4, 2010Pre-trial Conference: January 4, 2011Trial: January 11, 2011

REPLY IN SUPPORT OF MOTION TO DISQUALIFY GLASER WEIL

Case 2:04-cv-09049-DOC-RNB Document 9416 Filed 12/19/10 Page 1 of 27 Page ID #:283467

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TABLE OF CONTENTS

Page

PRELIMINARY STATEMENT ..................................................................................1

ARGUMENT ...............................................................................................................1

I. MGA'S OPPOSITION MISSTATES THE LEGAL STANDARD .................1

II. MGA'S OTHER ARGUMENTS ARE MERITLESS ......................................4

CONCLUSION ..........................................................................................................15

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Page

Cases

(Brand v. 20th Century Ins. Co.,124 Cal. App. 4th 594 (2004 ) ...............................................................................10

Chambers v. Superior Court,121 Cal. App. 3d 893 (3d Dist. 1981) ...................................................................11

City & County of San Francisco v. Cobra Solutions, Inc.,38 Cal. 4th 839 (2006) ................................................................................9, 10, 14

Cit^Nat'1 Bank v. Adams,96 Cal . App. 4th 315 (2d Dist. 2002) ......................................................................7

City of Santa Barbara v . Superior Ct.,122 Cal. App. 4th 17 (2d Dist. 2004) ....................................................................12

In re County of Los Angeles,223 F.3d 990 (9th Cir. 2000) ............................................................................2, 11

Flatt v. Super. Ct.,9 Cal. 4th 275 (1994) ....................................................................................3, 7, 13

Global Van Lines, Inc. v. Super. Ct.,144 Cal. App. 3d 483 (4th Dist. 1983) ..............................................................8, 13

H.F. Ahmanson & Co. v. Salomon Bros., Inc.,229 Cal. App. 3d 1445 (2d Dist. 1999) .............................................................7, 14

Henriksen v. Great Am. Sav. & Loan,11 Cal. App. 4th 109 (1st Dist. 1992) ............................................ 1, 11, 12, 13, 14

Hitachi, Ltd. v. Tatung Co.,419 F. Supp. '2d 1158 (N.D. Cal. 2006) ..............................................................2, 9

nterprise Co. LLC v. Draper Fisher Jurvetson Mgmt. Co. V, LLC,2005 WI., 757389 (N.D. Cal. Apr. 4, 2005) ................................................ 8, 10, 13

In re Complex Asbestos Litigation,232 Cal. App. 3d 572 (1st Dist. 1991) ..................................................................12

Kirk v. First Am. Title Ins. Co.,183 Cal. App. 4th 776 (2d Dist. 2010) ..................................... 1, 2, 3, 9, 12, 13, 15

Largo Concrete Inc. v . Liberty Mut. Fire Ins. Co.,2008 WL ^ 53128 (N.D. Cal. Jan. 2, 2008 ) ...................................................7, 10, 14

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Lutron Elecs . Co., Inc. v. Crestron Elecs., Inc.,No. 2:09-CV-707 (D. Utah Nov. 12, 2010) ..........................................................13

Meza v. H. Muehlstein & Co.,176 Cal. App. 4th 969 (2d Dist. 2009) ..................................................................12

Ochoa v. Fordel,146 Cal. App. 4th 898 (5th Dist. 2007 ) ..................................................................7

Openwave Systems v . 724 Solutions (US) Inc.,2010 WL 1687825 (N.D. Cal. Apr. 22, 2010) ......................................... 3, 5, 8, 10

People ex rel . Dept of Corr. v. SpeeDee Oil Change SYs. Inc•,20 Cal. 4th 113 5 (1999) ........................................................................................14

Pound v. DeMera DeMera Cameron,135 Cal. App. 4th 70 (5th Dist. 2005 ) ..............................................................9, 10

Rosenfeld Constr. Co. v. Super. Ct.,235 Cal. App. 3d 566 (5th Dist. 1991) ....................................................................8

Shadow Traffic Network v . Superior Court,24 Cal. App. 4th 1067 (2d Dist. 1994) ..................................................................12

ViChip Corp. v. Lee,2004 WL 2780170 (N.D. Cal. Dec. 3, 2004 ) ........................................................10

Western Digital Corp. v. Superior Court,60 Cal. App. 4th 1471 (4th Dist . 1998) ................................................................12

Other Authorities

Mark L. Tuft, et al., California Practice Guide: ProfessionalResponsibility (Rutter 2010) .................................................................. 5, 8, 10, 11

Mark L. Tuft, Non-Consensual Screening_for Conflicts in California.843 PLI/Lit 35 (December 2010) .......................^.........................................1, 3, 12

Utah Rule of Professional Conduct 1.10(c) ...............................................................13

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Preliminary Statement

"The general rule in California is that where an attorney is

disqualified, that attorney's entire firm is disqualified as

well regardless of efforts to erect an ethical wall."'

Glaser Weil cannot avoid what its own counsel admits are the rules: Glaser

^ Weil must be disqualified because it chose to hire an attorney who previously

^ represented Mattel in this very case. MGA's lengthy opposition, while interjecting

^ numerous irrelevant arguments, fails to acknowledge the applicable legal standard

^ and ignores that no California court has ever permitted this kind of conflict to

persist. California law requires disqualification of the entire Glaser Weil firm. As

Glaser Weil's own counsel acknowledged in the above-quoted article published this

month, no amount of claimed screening can change that conclusion.

Argument

I. MGA'S OPPOSITION MISSTATES THE LEGAL STANDARD

Glaser Weil cites no authority that justifies its request to be the first California

firm ever to hire a lawyer from the other side of the case and avoid disqualification.

Glaser Weil's own counsel has noted that even MGA's best case does not change

the result: "Under Kirk, ...screening may be a viable solution except in the

^ situation where a tainted attorney was actually involved in the prior representation

and switches sides in the same case. In that instance, no amount of screening will be

sufficient." Mark L. Tuft, Non-Consensual Screening for Conflicts in California,

I^ 843 PLI/Lit 35, at 6 (citing Kirk v. First Am. Title Ins. Co., 183 Cal. App. 4th 776,

814 (2d Dist. 2010) and Henriksen v. Great Am. Sav. & Loan, 11 Cal. App. 4th 109

I Mark L. Tuft, Non-Consensual Screening for Conflicts in California. 843PLI/Lit 35, at 2 (December 2010), attached hereto as Exhibit A; accord Mark L.Tuft, Screening for Conflicts in California, available athttp://www.cwclaw.com/publications/articleDetail.aspx? id=299 (visited December17, 201 p).

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(1st Dist. 1992)) (emphasis added). Glaser Weil's counsel acknowledged that this

was the law just this month, but now, after being hired by Glaser Weil, maintains

that screening is a viable solution to Glaser Weil's attempt to represent MGA after

hiring an attorney who represented Mattel in this very case. This revisionist view is

^ not the law in California. Nor is Mattel required to show that Ms. Basinger billed a

large number of hours to this case, that she actually possesses material confidential

information or that Glaser Weil's "ethical wall" is not working.

MGA is also wrong in maintaining that the present motion is governed by

^ "federal law." Qpp. at 4. Tellingly, MGA cites no authority for this assertion. As

set forth in Mattel' s motion, see Mot. at 3, this Court is required to apply California

disqualification law to the attorneys in this case. See In re County of Los Angeles,

223 F.3d 990, 995 (9th Cir. 2000) ("[W]e apply state law in determining matters of

disqualification."); Hitachi, Ltd. v. Tatung Co., 419 F. Supp. 2d 1158, 1160 (N.D.

Cal. 2006) (same).

As Glaser Weil's own counsel explained previously, California law requires

disqualification of Ms. Basinger and of the entire Glaser Weil firm. Glaser Weil

cannot rely on Kirk v. First American Title Ins. Co., 183 Cal. App. 4th 776 (2d Dist.

2010), a case involving a departed lawyer who had not worked on the other side of

the litigation in question (the lawyer had only had a 17-minute phone conversation

with a prospective client), fpr the proposition that an ethical wall can "solve" its

own hiring of a lawyer who remains at the Glaser Weil firm and did work on the

opposite side of this litigation. Kirk itself confirms that "if the tainted attorney was

(actually involved in the representation of the first client , and switches sides in the

same case, no amount of screening will be sufficient." Id. at 814; see also id. at 796

(noting the "absolute rule that ethical walls are not sufficient, and vicarious

disqualification is mandatory" where the tainted attorney is a nongovernmental

attorney that worked on the other side of the same case).

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That Kirk does not change the result is also confirmed by the two relevant,

post-Kirk federal decisions that each rejected Glaser Weil's suggestion that ethical

walls are suddenly able to obviate conflicts under California law. Glaxo Group Ltd.

v. Genetech, Inc., No. SA 10-CV-2764-MRP (FMOx) (C.D. Cal. June 15, 2010),

noted that Kirk is non-binding on federal courts and conflicts with California

Supreme Court precedent. See id. at 7 (citing Flatt v. Super. Ct., 9 Cal. 4th 275, 283

(1994)). Glaxo disqualified a firm that had hired an attorney that had worked on

the other side of a substantially related matter, despite an ethical wall. Openwave

Systems v. 724 Solutions (US) Inc., No. C 09-3511, 2010 WL 1687825, at *5 (N.D.

Cal. Apr. 22, 2010), acknowledged that Kirk "arguably" broke some new ground,

but refused to extend Kirk to a situation even less compelling than this one. There

the tainted lawyers had worked for the adversary on the other side of related

litigation (not the same case).

MGA fails to explain why Mattel's reliance on these two 2010 federal

decisions-one by this Court and one from the Northern District of California-is

"improper[]." Opp. at 15. To the contrary, these cases are the current state of the

law. As Glaser Weil's counsel conceded after Kirk was decided , and after the

California Supreme Court declined to review the decision, "[u]nder Kirk, .

screening may be a viable solution except in the situation where a tainted attorney

was actually involved in the prior representation and switches sides in the same

case. In that instance, no amount of screening will be sufficient and the presumption

of imputed knowledge is conclusive." Mark L. Tuft, Non-Consensual Screening for

Conflicts in California, 843 PLI/Lit 35, at 6 (citing Kirk, 183 Cal. App. 4th at 814,

and Henriksen, 11 Cal. App. 4th at 109) (emphasis added).2 Under California law,

2 The same counsel also has submitted athree-page declaration arguing that theCalifornia State Bar did not "reject," but rather just declined to include, a provision

(footnote continued)

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no amount of screening is sufficient to solve Glaser Weil's hiring of Ms. Basinger.

The presumption of imputed knowledge applies to the entire firm, and Glaser Weil

must be disqualified.

II. MGA ' S OTHER ARGUMENTS ARE MERITLESS

MGA makes a number of additional arguments that misstate either the law or

the facts relevant to this Motion.

MGA aûment .• The^•e was no side-switching. MGA surprisingly argues that

Ms. Basinger herself should not be disqualified , despite her 9 hours of work on the

other side of this very MGA v. Mattel case and 123 hours billed to a substantially

related matter. Ms . Basinger claims she "does not recall " performing any work on

Mattel v. MGA. Indeed, she maintains she did not even learn of the litigation until

she read about it in the newspaper after leaving Quinn Emanuel . See Opp. at 6;

Basinger Decl. ¶ 6. Ms. Basinger ' s own time records show that she billed 9 hours to

this very case on May 13 and 14, 2005. She billed Mattel for time spent discussing

case strategy with Mike Zeller, for review of confidential Mattel files and systems

that are directly at issue in this case, and for discussions with Mattel' s consulting

experts. Ms. Basinger ' s time entries are corroborated by those of Mike Zeller,

whose Mattel v. MGA time records confirm that he and Mattel ' s consulting experts

spoke with Ms. Basinger about confidential case strategy and that Ms. Basinger

participated in a group review of confidential Mattel materials with two partners and

two other associates on the case.

MGA's repeated argument that Mattel must disclose the privileged "facts"

^^ and "tasks performed" by Ms. Basinger and strategies to which she was privy is,

again, not the law -doing so would reveal the very information Mattel is seeking to

protect. See Mark L. Tuft , et al., California Practice Guide: Professional

approving ethical walls. See Tuft Declaration ¶¶ 3-6. This is a distinction without adifference for purposes of this motion.

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Responsibility § 4:199 (Rutter 2010) (citing cases) (courts must "avoid[] the ironic

result of disclosing the former client's confidences and secrets through inquiry into

the actual state of the lawyer's knowledge in proceedings to disqualify the

^ attorney"); Openwave , 2010 WL 1687825, at *5 (rejecting argument that evidence

^ of the type of work attorneys did was "too vague" to permit presumption that they

^ obtained material confidences). Mattel will, of course, provide full details on Ms.

^ Basinger ' s work in camera as ordered by the Court.

MGA argument: Mattel has not shown that Viveros and MGA v. Mattel are

^ substantially related. Although not necessary to support disqualification in light of

Ms. Basinger's prior work for Mattel on this very case, MGA concedes that Ms.

Basinger billed over 120 hours to the Viveros v. Mattel action. MGA further

concedes that the Viveros and Mattel v. MGA actions are substantially related "if

the issues are sufficiently similar to support a reasonable inference that the attorney

in the course of the prior representation was likely to have obtained confidential

information material to the current representation" or if the actions involve

"similarities in the[ir] legal problem[s]." Opp. at 11 (citing cases). These

standards are more than met with respect to Ms. Basinger's work on Viveros.

MGA concedes that both cases involved copyright infringement claims with

^ respect to Mattel dolls. Opp. at 11. It does not disavow its own, repeated

arguments -including at the most recent summary judgment hearings -that the

"Diva Starz" dolls at issue in Viveros are relevant to this case. The relevant

witnesses in both cases included many of the very same Mattel personnel. A key

issue in both cases is the copyright protectability of dolls and Mattel's litigation

strategy -fully relevant here - as to what doll elements are and are not protectable.

Ms. Basinger was involved in privileged and work product discussions with Mr.

Zeller and Mattel's in-house counsel Mr. Moore on this very issue. She was also

involved in document collection and preservation efforts (which included access to

confidential and privileged materials) that related to both cases, as corroborated by

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papers filed three years ago. See Docket No. 793, Declaration of Michael Moore in

Support of Mattel, Inc.'s Opposition to MGA Entertainment, Inc.'s Motion for

Terminating Sanctions, dated August 13, 2007, at 5-6. As that Declaration reflects,

MGA itself put at issue Mattel's document preservation and collection efforts,

which included such efforts not only in this case but also in Viveros and other cases.

Id. And, there is even more overlap than this, which Mattel can provide to the Court

in camera with the appropriate protections for privilege.

Attempting to downplay the material relationship between the two cases,

MGA makes the implausible claim that Ms. Basinger "was not aware of [the Mattel

v. MGA] action at the time she worked on Viveros." This is plainly wrong. Ms.

Basinger herself was actually billing time to the Mattel v. MGA matter "at the time

she worked on Viveros," and those time entries (as will be shown and explained in

camera if the Court so orders) reflect Ms. Basinger's receipt of privileged and work

product information about the Mattel v. MGA case. They show she conferred with

Mattel's nontestifying consultants about the confidential Mattel materials she

reviewed. Indeed, Ms. Basinger also personally delivered to Mr. Zeller, and

discussed with him, prior art that she suggested to Mr. Zeller would be useful in

defending against the trade dress infringement claims that MGA brought against

Mattel in Mattel v. MGA. The details will be presented to the Court in camera, if

ordered, but Ms. Basinger will need to explain how she "was not aware of a major

Mattel case to which she billed time, about which she discussed legal strategy, on

which she reviewed confidential documents (including documents that were not

produced) and spoke with consultants, and for which she took the initiative to

provide prior art and to suggest prior art defenses.

MGA arûment.• There is no showing that Ms. Basinger received confidential

^^ information or was privy to confidential strategy. The short answer is that this is

factually incorrect as already explained and, in any event, the law does not require

any such showing. Because Ms. Basinger did work for Mattel on this same case,

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and on a substantially related matter, Ms. Basinger's knowledge of Mattel's material

confidential information is irrebutably presumed. See Motion at 3-4; Flatt, 9 Cal.

4th at 283 ("Where the requisite substantial relationship between the subjects of the

prior and the current representations can be demonstrated, access to confidential

information ... in the course of the first representation (relevant, by definition, to

the second representation) is presumed and disqualification is mandatory;

indeed, the disqualification extends vicariously to the entire firm."); City Nat'l Bank

v. Adams, 96 Cal. App. 4th 315, 328 (2d Dist. 2002) ("Where the lawyer switches

sides in an ongoing dispute such as the one between the parties in this case, the

nature of the former representation will always be such that the exchange of relevant

confidences must be presumed.") (emphasis in original).

MGA is also wrong that some sort of "modified substantial relationship" test

should apply here. In Ochoa v. Fordel, 146 Cal. App. 4th 898 (5th Dist. 2007),

relied on by MGA, the allegedly conflicted lawyer did not bill any legal services to

the client that was moving to disqualify. Id. at 902. Rather, other attorneys at his

former firm had done work for the client. In contrast, Ms. Basinger billed more than

130 hours to Mattel - 9 hours to Mattel v. MGA and 123 hours to Viveros -for

work that was on this case or substantially related to this case. The conclusive

presumption that she acquired material confidential information applies. See, ^,

Largo Concrete Inc. v. Liberty Mut. Fire Ins. Co., No. C 07-04651 CRB, 2008 WL

53128, at *4 (N.D. Cal. Jan. 2, 2008) (rejecting argument that modified "substantial

relationship" test should apply, because the attorney actually billed legal services to

the former client who sought to disqualify him).

Given that the conclusive presumption described by the California Supreme

^^ Court in Flatt applies, the Court should reject MGA's invitation to conduct a factual

inquiry into what Ms. Basinger actually learned while representing Mattel. "The

whole point of the presumption ... is that a court does not inquire into the factual

particularities of the information conveyed." Id. at *4; see also H.F. Ahmanson &

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Co. v. Salomon Bros., Inc., 229 Cal. App. 3d 1445, 1453 (2d Dist. 1999) (court may

not conduct an "inquiry into the actual state of the lawyer's knowledge" acquired

during the former representation); Global Van Lines, Inc. v. Super. Ct., 144 Cal.

App. 3d 483, 489 (4th Dist. 1983) (presumption of confidential knowledge and

automatic disqualification is a rule of "necessity" because the former client has no

way of proving the attorney's knowledge or lack thereof). As Glaser Weil's counsel

put it, the presumption is necessary to "avoid[] ... of disclosing the former client's

confidences and secrets through inquiry into the actual state of the lawyer's

knowledge in proceedings to disqualify the attorney." Mark L. Tuft, et al.,

California Practice Guide: Professional Responsibility § 4:199 (citing cases); see

also Openwave, 2010 WL 1687825, at *5 (rejecting argument similar to MGA's).

Ms. Basinger's claim that she "does not remember" working on this case or

receiving confidential information is of no moment. Courts have repeatedly held

that where , as here, the prior and subsequent representations are the same or

substantially related , an attorney ' s claimed inability to remember will not prevent

disqualification . See, e.g_, I-Enterprise Co. LLC v. Draper Fisher Jurvetson Mgmt.

Co. V, LLC, 2005 WL 757389, at *6-*8 (N.D. Cal. Apr. 4, 2005) (disqualifying

entire firm , despite attorney's inability to remember); Rosenfeld Constr. Co. v.

Super. Ct. , 235 Cal. App . 3d 566 , 576-78 (5th Dist. 1991) (trial court abused its

discretion in denying motion to disqualify based on attorney's claimed lack of

memory); Global Van Lines, 144 Cal . App. 3d at 487-90 (disqualifying firm where

attorney claimed not to recall any material information).

Finally, Mattel's motion does make a showing that Ms. Basinger was privy to

^^ material confidential information in the course of her work for Mattel. This is

confirmed by her time entries, which the Court can review. On Mattel v. MGA and

Viveros, Ms. Basinger billed Mattel for her discussions of strategy with Mr. Zeller

and Mattel's consulting experts; on Viveros, she was also involved in privileged and

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work product discussions with Mr. Zeller and Mattel' s in-house counsel. See

^ Motion at 1-2; supra pages 3-4.

MGA argument: Ms. Basin^r's involvement was `peripheral, "and her time

may have been misbilled. MGA's contention that Ms. Basinger's substantially

related work for Mattel was "minimal" and "peripheral" is wrong. Ms. Basinger

billed a combined 132.3 hours to Viveros and Mattel v. MGA. As an eighth-year

lawyer, Ms. Basinger was not a mere "low-level" or even "mid-level" attorney, as

Glaser Weil has inconsistently sought to portray her. She was involved in high-level

case strategy, supervised junior associates, and communicated directly with Mattel

in-house counsel. Numerous courts have held that far lower-level work or less

client contact mandates disqualification. See, ^, City & County of San Francisco

v. Cobra Solutions, Inc., 38 Cal. 4th 839, 845 (2006) (disqualifying entire city

attorney's office because attorney formerly in private practice spent four-tenths of

an hour reviewing a contract in related case); Hitachi, 419 F. Supp. 2d at 1159-61

(disqualifying entire firm despite claim that associate's prior work for other side on

a related matter was "primarily document review" and despite ethical wall); Pound

v. DeMera DeMera Cameron, 135 Cal. App. 4th 70, 80 (5th Dist. 2005) (ordering

vicarious disqualification of entire firm based on individual conflict of attorney who

had cone-hour meeting with counsel for opposing party three years earlier, claimed

to have discussed nothing beyond what one could learn from the pleadings, and was

never retained). Even Kirk, the case relied upon so heavily by MGA, held that a 17-

minute phone conversation between an attorney and a prospective client disqualified

that attorney from representing an adverse party in a related case after switching law

firms. See Kirk, 183 Cal. App. 4th at 790-91.

Ms. Basinger's relevant work for Mattel was far less "peripheral" than that of

numerous other attorneys who have been disqualified. There is no minimum

number of hours that an attorney must spend on a representation; even a fraction of

an hour on the same or a substantially related matter compels disqualification. ^,



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I-Enterprise, 2005 WL 757389, at *6 (disqualifying firm that hired attorney who

billed one-half hour to the same litigation prior to switching firms); Cobra Solutions,

3 8 Cal. 4th at 845 (attorney who spent four-tenths of an hour reviewing a contract

could not be adverse to former client in related case); see also Largo, 2008 WL

53128, at * 1-5 (disqualification of entire firm despite claim that transferring

associate performed 9.8 hours of work over 6 days as essentially "a paralegal" in a

related matter, despite associate's testimony that he did not review anything that

would be of use in the pending litigation and despite ethical wall); ViChip Corp. v.

Lee, 2004 WL 2780170, at *3 (N.D. Cal. Dec. 3, 2004) (disqualifying law firm of

transferring attorney who billed 2. S hours on behalf of former client in related case);

Pound, 135 Cal. App. 4th at 80 (attorney who had one-hour meeting with counsel

for other side three years earlier required disqualification of firm).

MGA also suggests that Ms. Basinger 's conflict is somehow diminished or

eliminated because it has been five years since she did relevant work for Mattel.

See, ^, Opp. at 6. This is plainly wrong. As Glaser Weil's counsel states, "[i]f

the same subject matter is show^l to be involved, the length of time since the former

representation is irrelevant." Mark L. Tuft, et al., California Practice Guide:

Professional Responsibility § 4:189.2 (citing cases). No California court has ever

permitted an attorney to switch sides in a pending litigation, no matter how many

years have elapsed . See, ^, Glaxo, No . SA 10-CV-2764-MRP (FMOx), at 5-7

(firm disqualified because attorney represented opposing party in a related matter

eight years earlier); Openwave, 2010 WL 1687825, at *4-*6 (granting motion to

disqualify law firm based on attorneys' work on a substantially related case six to

ten years earlier); Cobra Solutions, 38 Cal. 4th at 853-54 (disqualifying entire San

Francisco City Attorney's Office because City Attorney, in former private practice,

spent four-tenths of an hour reviewing contract in a related matter five years earlier);

Brand v. 20th Century Ins. Co., 124 Cal. App. 4th 594, 607 (2004) (attorney

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disqualified from acting as expert because he represented opposing party 12 years

^ earlier).

MGA argument.• cases other than Kirk support use of an ethical wall here.

^ MGA cites a number of other factually inapposite cases, see Opp. at 17, none of

^ which suggests that screening can overcome disqualification here:

• Chambers v. Superior Court, 121 Cal. App. 3d 893 (3d Dist. 1981),

held that an ethical wall prevented vicarious disqualification of a firm that hired a

former government lawyer who had worked on the other side of similar lawsuits.

That case is distinguishable for at least two reasons. First, unlike Ms. Basinger, the

attorney never worked on the other side of the same action. Second, ethical walls

are treated differently when applied to former government attorneys, and Chambers

expressly limited its holding to that context. See id. at 902-03 (observing that if

vicarious disqualification were always the rule for former government employees,

this would severely restrict government attorneys' options for future employment);

Henriksen, 11 Cal. App. 4th at 115 (noting that "limited acceptance" of ethical walls

in California has been confined to "a very different arena that of former

government employees now in private practice").

• In In re County of Los Angeles, 223 F.3d 990 (9th Cir. 2000), the

defendants in a police brutality case sought to disqualify the plaintiff's law firm

because one member of the firm, a retired magistrate judge, had presided over

settlement negotiations involving two of the defendants in a different police brutality

case. Like Chambers, County of Los Angeles is distinguishable because the conflict

did not involve the same case and because judicial officers, like former government

lawyers, are treated differently. Id. at 994 (distinguishing cases disqualifying firms

when former judge had participated in mediation or settlement efforts in the same

case); Mark L. Tuft, et al., California Practice Guide: Professional Responsibility

§ 4:216 ("As with former judicial officers, vicarious disqualification is not imposed

as strictly on law firms hiring a former government lawyer.").

-,.^-Y INSUPPORT OF MOTION TO DISQUALIFY GLASER WEIL


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• City of Santa Barbara v. Superior Ct., 122 Cal. App. 4th 17 (2d Dist.

2004), allowed screening where an attorney formerly in private practice joined a

government entity, noting that "vicarious disqualification in the public sector

context imposes different burdens pn the affected public entities." The court limited

its holding to government employees and indeed made clear that private law firms

like Glaser Weil must be disqualified. Id. at 24 ("Were we concerned with a private

law firm, the answer would be clear: Knecht's disqualification would be mandatory

^ and would extend to her entire law firm.").

• MGA's reliance on In re Complex Asbestos Litigation, Shadow Traffic

Network v. Superior Court, and Western Digital Corp. v. Superior Court,

demonstrates the absence of California authority supporting MGA's arguments

about ethical walls: none of these cases involved a conflicted attorney. See 232 Cal.

App. 3d 572 (1st Dist. 1991) (paralegal); 24 Cal. App. 4th 1067 (2d Dist. 1994)

(expert), 60 Cal. App. 4th 1471 (4th Dist. 1998) (expert).

Further, MGA' s attempts to distinguish the numerous cases cited by Mattel

holding that vicarious disqualification is required here are unconvincing. Compare

Motion at 4-8 with Opp. at 16-22. As Glaser Weil's counsel has explained, no

',California case-even after Kirk--has ever suggested that screening is permissible

where an attorney worked on the other side of the same pending case. See Mark L.

Tuft, Non-Consensual Screening for Conflicts in California, 843 PLI/Lit 35, at 6;

see also Meza v. H. Muehlstein & Co., 176 Cal. App. 4th 969, 978 (2d Dist. 2009)

("As a general rule in California, where an attorney is disqualified from

representation, the entire law firm is vicariously disqualified as well. This is

especially true where the attorney's disqualification is due to his prior representation

of the opposing side during the same lawsuit."); Henriksen, 11 Cal. App. 4th at 117

("Where an attorney is disqualified because he formerly represented and therefore

possesses confidential information regarding the adverse party in the current

litigation, vicarious disqualification of the entire firm is compelled as a matter of

-,^-REPLY IN SUPPORT OF MOTION TO DISQUALIFY GLASER WEIL


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^ law."); Flatt, 9 Cal. 4th at 283 (1994) (citing Henriksen with approval for same

proposition); Kirk, 183 Cal. App. 4th at 814 (acknowledging that this is the rule).

MGA argument.• Mattel's aûments a^nst the efficacy of ethical walls are

"inconsistent " with Lutron Electronics Co., Inc. v. Crestron Electronics, Inc.

Contrary to MGA's suggestion (see Opp. at 2 n. l ), Mattel's arguments are not

inconsistent with Lutron Elecs. Co., Inc. v. Crestron Elecs., Inc., No. 2:09-CV-707

(D. Utah Nov. 12, 2010), a case involving an unsuccessful attempt to disqualify

^ Quinn Emanuel, nor does that case support Glaser Weil's attempt to avoid

^ disqualification here. Unlike Ms. Basinger, the tainted attorney in Lutron never

^ worked on the other side of the same litigation. Further, the Lutron motion was

^ governed by Utah law, and the Utah Rules of Professional Conduct expressly

^ permitted the ethical screening that had been implemented in that case. See Utah

Rule of Professional Conduct 1.10(c); see also Lutron , at 7. The only

"inconsistency" here is Glaser Weil's counsel's argument that a wall can screen a

California lawyer who moves to the opposite firm in the same case -after

publishing articles, post-Kirk, declaring that the rule in California is the opposite.

MGA ar uênt: Disqualification would prejudice MGA and infringe u^

MGA's right to counsel o its choice. MGA is wrong that this motion is "a litigation

ploy." Opp. at 1. Glaser Weil chose to bring in an attorney who formerly

represented Mattel in this very matter just nine days before it sought to (formally)

reassociate in as counsel for MGA. "[A]n attorney should not put either himself or

his client in such a position." Global Van Lines, 144 Cal. App. 3d at 490 (rejecting

argument that court should "wait and see" if ethical wall worked and ordering

disqualification of entire firm, despite transferring attorney's claim not to have any

knowledge of the litigation). MGA's protests that disqualification would be

"drastic" and "disruptive" (see Opp. at 3, 22) are also off-base. Numerous

California state and federal courts, while acknowledging that disqualification is a

"harsh remedy," have ordered it under these circumstances. See, ^, I-Enterprise,

_ -IJ-



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2005 WL 757389, at *8 (ordering disqualification, despite claims that it would be

"harsh and unjust" at late stage of litigation and that getting new counsel up to speed

would be "prohibitively expensive"); Henriksen, 11 Cal. App. 4th at 185, 187

(rejecting arguments of prejudice and financial hardship and granting motion to

disqualify counsel two-and-a-half years into the litigation).

As the California Supreme Court has instructed, "[t]he paramount concern

must be to preserve public trust in the scrupulous administration of justice and the

integrity of the bar. The important right to counsel of one's choice must yield to

ethical considerations that affect the fundamental principles of our justice process."

People ex rel. Dept of Corr. v. SpeeDee Oil Change Sys. Inc., 20 Cal. 4th 1135,

1145 (1999); see also Largo, 2008 WL 53128, at *2 (quoting SpeeDee Oil); Cobra

Solutions, 38 Cal. 4th at 851 (former client's "overwhelming interest in preserving

the confidentiality of information imparted by counsel" overrides any burdens

imposed by disqualification); H.F. Ahmanson, 229 Cal. App. 3d at 1451 ("The court

does not engage in a `balancing of equities' between the former and current clients.

The rights and interests of the former client will prevail.").

Even if the burden on MGA were relevant-it is not any prejudice to MGA

is minimal, given that Glaser Weil withdrew from this action (for a second time) in

February 2009-more than twenty-two months ago-and only sought to reassociate

as counsel two weeks ago. This is clearly not a case where MGA will be left

without representation (although numerous courts have ordered disqualification

even under those circumstances )-Orrick has been and will remain lead counsel.

No delay in the trial will occur, or even would be warranted, with disqualification

here.

Finally, any burden to MGA is a result of Glaser Weil's own decision: to hire

an attorney who had previously represented Mattel in this very case and in another,

substantially related matter. Glaser Weil was aware of Ms. Basinger's work for

Mattel when it hired her (Opp. at 2, 24), but it chose to hire her anyway. Glaser

-^-REPLY INSUPPORT OF MOTION TO DISQUALIFY GLASER WEIL


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Weil and MGA must now live with the consequences of that decision. See Kirk 183

Cal. App. 4th at 816 n.37 (distinguishing the "egregious" situation of law firm that

"had been fully aware that it was hiring an attorney who had represented a defendant

in the same action").

Conclusion

Mattel respectfully requests that the Court grant its motion.

DATED: December 19, 2010 QÎNN EMANUEL URQUHART &S LIVAN. LLP

By /^ John B. OuinnJohn B. QuinnAttorneyys for Mattel, Inc. andMattel de Mexico . S.A. de C.V.

ÎJ-



Exhibit A

^zxierrPAGE ^^


Non-Consensual Screening For Conflicts in California

syMark L. Tufts

Cooper, White & Cooper IrLP

Non-consensual screening as a means of avoiding imputation of lateral lawyer

conflicts is an evolving issue in California. California historically has not recognized the

availability of screening to prevent imputation of conflicts between lawyers relocating

between private firms. See Sharp v. Next Entertainment, Xnc., 163 Cal. App. 4th 310, 438

(2008). California currently does not have an imputation rule comparable to ABA Model

Rule 1.10, nor does California have rules that address screening in the case of former

government lawyers, {Model Rule 1.11), former judges and third party neutrals {Model

Rule 1.12) or in dealing with prospective clients (Model Rule 1.18). Instead, imputation

of conflicts of interest is a matter of common law. See California Practice Guide:

Professional Responsibility {The Rutter Group; A Division of West, A Thomson Renter's

Business) (2009) ¶ 4:32.

The State Bar Commission for the Revision of the Rules of Professional Conduct

recommended adoption of a modified version of ABA Model Rule 1.1 p permitting non-

consensual screening except where the lawyer was substantially involved in the former

representation . The State Bar Board of Governors recently declined to adopt the

Commiss'ion's recommendation and, instead, approved a version of Model Rule 1.10 that

1 02410 Mark L. Tuft, All rights reserved.

EXNIÎT639694.1 _ 1 _

/^'

PAGE


does not contain a screening provision. The Board's decision was based on its belief that

screening should continue to be developed through case law rather than through a nlle of

professional conduct.

Vicarious Disqualification

California courts were alnong the first to apply the imputed knowledge rule

relying in part on ABA Model Code DR 5-105(D). Clzadwiclc v. Superior Court, 106

Cal. App. 3d 108, 116 {1980), superseded by statute on other grounds in People v.

Donner, 34 Cal. 3d 141 (1983); Chansbers v. Superior Court, 121 Cal. App. 3d 893, 898

(1981}. The general rule in California is that where an attorney is disqualified, that

attorney's entire firm is disqualified as well regardless of efforts to erect an ethical wall.

Klein v. Superior Court, 198 Cai. App. 3d 894, 912-914 (1998); Henriksen v. Great

American Savings c4^ Loan, 11 Cal. App. 4th 149, i 17 {1992).

The California Supreme Court has not expressly changed the presumption of

shared confidences in successive representation cases. City & Cou^xty of San Francisco

v. Cobra Solutions, Inc., 38 CaI.4th 839 (2006). However, based on a statement in

People ex. rel. Dept. of Corporations v. SpeeDee Oil Change Systems, Inc, 20 CaI.4th

1135, 1151-1152 (1999) (that the record lacked ail evidentiary basis for considering

whether an ethical screen could be used to avoid disqualification afthe law firm based on

the firm's disqualified "of counsel"}, the Ninth Circuit noted in I^x re County of Los

Angeles, 223 F.3d 990, 995 (9th Cir. 2000) that the Court is "sending a signal that [it]

may well adopt a more flexible approach to vicarious disqualification" ill certain cases.

Yet, the basic imputation rule remains intact. Hitachi, Ltd. 1^. Tatacng Company, 419 F.

Supp . 2d 1158,1161 (N.D. GA. 2006).

639b94.1 _ 2

EXHIBIT

PAGE ^ ^


Several courts have relaxed the imputation standard in specific situations.

Goldberg v. Warner/Chappell Music, Inc., 125 Cal. App. 4th 752 {2005} (where the

disqualified attorney leaves the firm and the prior firm shows it did not receive

confidential information}; Adams v. Aerojet-General Corp., 86 CaI. App. 4th 1324 {2001}

{where the new firm shows that the lateral attorney had no exposure to confidential

information relevant to the current action}. Thus, in so-called "double imputation"

situations, disqualification ofthe former lawyer and the lawyer's new firm is not

automatic. Frazier v. Superior Court, 97 Cal. App. 4th 23, 27 (2002); Derivi

Construction &Architecture, Inc v. Wong, 118 Cal. App. 4th 1268, 1274-1276 (2004}.

instead, a court must determine whether confidential information material to the current

matter would normally have been imparted to the attorneys by virtue of the nature of the

former representation and the lawyer's involvement. Adams, supra, 86 Cal. App. 4th at

1339; see also, Los Angeles Bar Assn Formal Opinion 501 (1999); ABA Formal

Opinion 99-145.

To determine whether disqualification of a former attorney or the attorney's new

firm is appropriate, California courts have developed a "modified substantial relationship

test." The central focus of the testis whether confidential information was reasonably

likely to have been imparted to the attorney while at the former fine. Adams, supra, 86

Cal. App. 4th at 1340; Frazier, supra, 97 Cal. App. 4th at 33-34; Fauglin v. Perez, 135

Cal. App. 4th 592, 603; Ochoa v. Fordel, Ine.> 146 Cal. App. 4th 898, 908. The

"modified substantial relationship test" is similar in many respects to ABA Model Rule

1.9(b), which the California State Bar Rules Revision Commission has recommended for

adoption, and Restatement Third, The Law Governing Lawyers ^ 124, Comment e(ii); see

EXHIBIT639694.1 _ 3 _

_r____. _____ ___..-PAGE


also Silver Chrysler Plymouth, Inc. v. Chrysler Motor Corp., 518 F.2d 751, 757 {2d. Cir.

1975). Where a showing is made that it is not reasonably likely that material confidential

information was imparted to the attorney at the former firm, a rebuttable presumption

arises and the firm-switching attorney has the burden of proving the attorney did not have

actual exposure to confidential information materraI to the current matter. Adams, supra,

86 Cal. App. 4th at 1341; Ochoa, supra, 146 Cal. App. 4th at 911-912.

Non-Consensual Screening for Migrating Lawyers

Courts in California will permit screening in certain contexts. For example, a law

firrn will not be vicariously disqualified because a former judicial officer who heard a

portion of the case subsequently joins a firm of one of the parties so long as no

confidences were revealed to the judicial officer by the opposing side and appropriate

screening procedures are established . Higdon v. Superior Court, 227 CaI. App. 3d 1b67

{1991); In re County of Los Angeles, supra, 223 F. 3d 990 . However, screening will not

avoid disqualification if the former judicial officer participated in settlement discussions

in the case . Cho v. Superior Court, 39 Cal. App. 4th i 13 (1995).

Screening procedures may also protect against the presumption of shared

confidences when hiring former government lawyers (Chambers v. Superior Court, 121

Cal. App. 3d 893 {1981)} as well as private lawyers joining a government office . City of

Santa Barbara v. Superior Court, 122 Cal. App. 4th 17 (2004}. However, a public office

may not avoid vicarious disqualification by using screening procedures to shield a

conflicted lawyer who becomes the head of the office. Cobra Solutions , supra , 38 CaI.

4th at 850 . Screening procedures can also be effective in overcoming the presumption of

shared confidences when hiring an opposing counsel 's former paralegal or secretary {Iii re

EXHIBIT639694.1 _ 4. _

PAGE


Complex.4sbestos Litigation , 232 Cal. App. 3d 572 ( 1991}} or employing an expert

previously consulted by the other side . Shadow Traffic Network u. Superior Court, 24

Cal. App. 4th 1067, 1087 (1994}; Western Digital Corp, u. Superior Court, 60 Cal. App.

4th 1471 (1998).

Recently, the Second District Court of Appeal decided in Kirk v. First American

Title ins. Co., 183 Cal.App.4th 776 {2010), that imputation of conflicts may, in certain

circumstances, be prevented in private sector lateral transfers through the use of timely

and effective screening procedures. In Kirk, counsel for plaintiffs in four class actions

brought against a title insurance company contacted an attorney for another insurance

company to serve as plaintiffs' consultant. The attorney declined the assignment and later

joined a private law firm. Plaintiffs' counsel re-contacted the attorney at the firm and the

attorney again declined the assignment as plaintiffs' consultant. Later, lawyers for the

defendant in the class action cases joined the same law firm. It was undisputed that the

tainted lawyer had acquired material confidential information in communications with

plaintiffs' counsel . The court, nevertheless, found that, under these facts, vicarious

disqualification of the law firm was not automatic and could be rebutted by proper

screening measures. Kirk, supra, 183 Ca1.App.4th at 786, 814.

The facts in Kirk involve a "prospective" client conflict situation rather than a

former client conflict. Kirk, supra, 183 Cal.App.4th at 78b-788; see Model Rule 1.18.

California's Rules Revision Commission has recommended adoption of a version of

Model Rule 1.18, which the Board approved but, again, without the screening provision

in Model Rule 1.8(d)(2). The court's holding in Kirlc, however, recognizing screening as

an available means of avoiding vicarious disqualification is not lizxzited to the prospective

EXHIB IT639694 .1 _ ^ „ ^ /

PAGE


client conflict situation. See, e.g., Kirk, supra, 183 Cal.App.4th at 814 {"In sum, we have

concluded that, when a tainted attorney moves from one private law firm to another, the

law gives rise to a rebuttable presumption of imputed knowledge to the law fine, which

may be rebutted by evidence of effective ethical screening."). Under Kirk, vicarious

disqualification is still determined on a case-by-case basis and screening may be a viable

solution except in the situation where the tainted attomey was actually involved in the

prior representation and switches sides in the same case. In that instance, no amount of

screening will be sufficient and the presumption of imputed knowledge is conclusive.

Kirk, supra, 183 Cai.App.4th at 814; and see Henrilrsen v. Great American Savings &

Loan (1992) 11 Cal.App.4th 109.

While the Supreme Court has not addressed whether vicarious disqualification of

a tainted lawyer's new firm can be avoided bynon-consensual screening in the private

sector, the Supreme Court denied a petition for review in Kirk and a request that the

decision be de-published. Accordingly, Kirk is good Iaw in California.

What Constitutes an Effective Ethical Screen

What constitutes an effective ethical wall varies from case-to-case. However, as

the court in Kirk explained, two elements are critical: the ethical wall must be established

as early as possible and preventive measures must be imposed to guarantee that

confidential information will not be conveyed. Kirk, supra, 183 Ca1.App.4th at 810. It is

generally understood that a screen or ethical wall means "the isolation of a lawyer from

any participation in a matter through the timely imposition of procedures within a Finn

that are reasonably adequate under the circumstances to protect information that the

isolated lawyer is obligated to protect under the [applicable ethics rules] or other law."

^ÊXHIBIT639694.1 _ ( _

PAGE ^^


ABA Model Rule 1.0(k).

Typical features of an effective ethical wall include: (1) physical, geographic and

departmental separation of attorneys and staff; (2) prohibitions against and sanctions for

discussion of confidential information; (3) established rules and procedures for

preventing access to confidential information and files; (4) procedures preventing a

disqualified attorney from sharing in the profits from the representation; (5) lack of any

supervisory relationship between the tainted attorney and the lawyers involved in the

current matter or vice-versa; and (6) reasonable notice to the client. Kirlc, supra, 183

Ca1.App.4th at 810-813; Henriksen v. Great American Savings & Loan, 11 Ca1.App.4t11

109, 116, fn. 6 (1992} ;City of Santa Barbara v. Superior COUI^t, 122 Cal.App.4th 17, 27

(2004).

EXH^îT639694.1 _ 7 „ ^^

PAGE


EXHIBIT D

UNITED STATES DISTRICT COURTCENTRAL DISTRICT OF CALIFORNIA

CIVIL MINUTES - GENERAL

CV-90 (12/02) CIVIL MINUTES - GENERAL Page 1 of 1

Case No. CV 04-9049 DOC (RNBx) Date December 20, 2010

Title MATTEL INC. -V- MGA ENTERTAINMENT INC., ET AL

Present: The Honorable David O. Carter, U.S. District Judge

Julie Barrera, Kathy Peterson Debbie Gale, Jane Sutton, Deborah Parker N/ADeputy Clerk Court Reporter / Recorder Tape No.

Attorneys Present for Plaintiffs: Attorneys Present for Defendants:

Michael QuinnMichael ZellerWilliam Price

Annette HurstThomas McConville

Patricia GlaserStephen Kaus

Alexander CoteMark Overland

Proceedings: EVIDENTIARY HEARING ON MATTEL’S MOTION TO DISQUALIFY GLASERWEIL [9359]; HEARING (NON-EVIDENTIARY) ON MATTEL’S MOTION FORPARTIAL SUMMARY JUDGMENT ON MGA’S COUNTERCLAIMS-IN-REPLY

The cause is called and counsel state their appearances. Arguments heard by John Quinn andStephen Kaus on Mattel’s Motion to Disqualify Glaser Weil. The courtroom is cleared for in camerahearing.

Sealed in camera evidentiary hearing held. Exhibit and witness list filed.

Further sealed in camera hearing held with John Quinn, Michael Zeller and William Price.

The Court permits Patricia Glaser to remain as co-lead counsel for MGA but grants Mattel’sMotion to Disqualify Glaser Weil. The Court orders the parties to return on December 21, 2010 at 10:00a.m. to discuss conditions associated with Ms. Glaser remaining as co-lead counsel.

All parties return to the courtroom and hearing is held on Mattel’s Motion for Partial SummaryJudgment on MGA’s Counterclaims-in-Reply, which is taken under submission.

evid: 2non-evid: 1

: 0056

Initials of Preparer kp


EXHIBIT E

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04558.23511/4317865.4 MEMO. ISO PLAINTIFF'S MOTION TO DISQUALIFY MCKOOL SMITH

QUINN EMANUEL URQUHART & SULLIVAN, LLP Frederick A. Lorig (Bar No. 057645) [email protected] Steven M. Anderson (Bar No. 144014) [email protected] Christopher A. Mathews (Bar No. 144021) [email protected]

Michael W. Gray (Bar No. 238669) [email protected]

865 South Figueroa Street, 10th Floor Los Angeles, California 90017-2543 Telephone: (213) 443-3000 Facsimile: (213) 443-3100 Attorneys for Plaintiff PACKETVIDEO CORPORATION


SOUTHERN DISTRICT OF CALIFORNIA

PACKETVIDEO CORPORATION, a Delaware corporation,

Plaintiff,

v. SPOTIFY USA INC., a Delaware corporation, SPOTIFY LIMITED, a United Kingdom corporation, and SPOTIFY TECHNOLOGY SARL, a Luxembourg corporation,

Defendants.

CASE NO. 3:11-cv-1659 IEG WMc MEMORANDUM OF POINTS AND AUTHORITIES IN SUPPORT OF PLAINTIFF PACKETVIDEO CORPORATION'S MOTION TO DISQUALIFY MCKOOL SMITH FROM SERVING AS COUNSEL FOR DEFENDANTS Place: Courtroom 1 Judge: Hon. Irma E. Gonzalez

Case 3:11-cv-01659-IEG-WMC Document 16-1 Filed 09/07/11 Page 1 of 19

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04558.23511/4317865.4 -i- MEMO. ISO PLAINTIFF'S MOTION TO DISQUALIFY MCKOOL SMITH

TABLE OF CONTENTS

Page

I. INTRODUCTION ................................................................................................................. 1

II. STATEMENT OF FACTS .................................................................................................... 4

A. PacketVideo And Mr. Chambers, a Partner in McKool Smith's Dallas Office, Arranged A Phone Call To Discuss PacketVideo's Patent Infringement Action Against Spotify ........................................................................ 4

B. In His July 7, 2011 Call With Mr. Chambers, PacketVideo's General Counsel Disclosed Privileged And Confidential Information, And Obtained Legal Advice, Concerning This Action ..................................................................... 5

C. McKool Smith Created Work Product, And Provided PacketVideo With Specific Legal Advice About This Action In A Follow-Up Call .............................. 7

D. After PacketVideo Retained Alternative Counsel, McKool Smith Switched Sides And Appeared On Behalf Of Spotify In This Action ...................................... 8

III. ARGUMENT ...................................................................................................................... 10

A. California Law Governs Whether McKool Smith, As Prior PacketVideo Counsel, Can Switch Sides To Represent Spotify In This Action .......................... 10

B. McKool Smith Formed An Attorney-Client Relationship With PacketVideo When It Obtained Confidential Information And Provided Legal Advice, Barring Its Representation Of Spotify In This Action ............................................ 12

C. California Law Mandates Vicarious Disqualification Of The Entire McKool Smith Law Firm, Regardless Of Efforts To Erect An Ethical Wall ........................ 13

IV. CONCLUSION ................................................................................................................... 14


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04558.23511/4317865.4 -ii- MEMO. ISO PLAINTIFF'S MOTION TO DISQUALIFY MCKOOL SMITH


Page(s)

Cases

Analytica, Inc. v. NPD Research, Inc., 708 F.2d 1263 (7th Cir. 1983) ....................................................................................................14

Beery v. State Bar, 43 Cal. 3d 802 (1987) .................................................................................................................12

City of Nat'l Bank v. Adams, 96 Cal. App. 4th 315 (2002) .......................................................................................................14

In re County of Los Angeles, 223 F.3d 990 (9th Cir. 2000) ......................................................................................................14

In re Dupont's Estate, 60 Cal. App. 2d 276 (1943) ........................................................................................................12

Flatt v. Superior Court, 9 Cal. 4th 275 (1994) ..................................................................................................................13

Henriksen v. Great America Savings and Loan et al., 11 Cal. App. 4th 109 (1992) .....................................................................................11, 12, 13, 14

Hitachi, Ltd. v. Tatung Co., 419 F. Supp. 2d 1158 (N.D. Cal. 2006) ...............................................................................11, 13

Laryngeal Mask Co. Ltd. v. Ambu A/S, No. 07-CV-1988-DMS (NLS), 2008 WL 558561 (S.D. Cal. Feb. 25, 2008) ..................................................................................2, 3, 11, 12, 13, 14

Lucent Tech. Inc. v. Gateway, Inc., No. 02CV2060-B(CAB), 2007 WL 1461406 (S.D. Cal. May 15, 2007) ........................10, 11, 13

People ex rel. SpeeDee Oil Change Sys., Inc., 20 Cal. 4th 1135 (1999) ..............................................................................................1, 11, 12, 14

Statutes

Cal. R. Prof. Conduct 1-100 (D) (2) .................................................................................................11

Fed. R. Civ. P. 5(b)(3) ......................................................................................................................16

Local Rule 5.4 ..................................................................................................................................16

S.D. Cal. Civ. R. 83.4 (b) .................................................................................................................11


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04558.23511/4317865.4 -1- MEMO. ISO PLAINTIFF'S MOTION TO DISQUALIFY MCKOOL SMITH

I. INTRODUCTION

Plaintiff PacketVideo Corporation ("PacketVideo") respectfully moves the Court to correct

"the most egregious conflict of interest" possible between a client and its attorneys: an attorneys'

"representation of clients whose interests are directly adverse in the same litigation." People ex rel.

SpeeDee Oil Change Sys., Inc., 20 Cal. 4th 1135, 1147 (1999). As discussed hereinafter,

Defendants' lead counsel, McKool Smith, previously represented Plaintiff in connection with this

litigation and has now switched sides, filing an answer on behalf of Defendants Spotify USA and

Spotify Limited. Moreover, McKool Smith "pitched" the case to Defendants after Plaintiff

decided to file its Complaint in the present district.

In early July of 2011, PacketVideo's General Counsel, Joel Espelien, contacted a partner in

McKool Smith's Dallas office to investigate the possibility of hiring McKool Smith to represent

PacketVideo in patent infringement action against Defendants Spotify USA Inc., Spotify Limited,

and Spotify Technology SARL (collectively, "Spotify"). Mr. Espelien participated in several

private discussions with Garret Chambers, a partner at McKool Smith, through which

PacketVideo and the McKool Smith firm unequivocally formed an attorney-client relationship.

During a July 7th call, Mr. Espelien revealed extensive confidential information to Mr. Chambers

on a range of strategically sensitive issues, and Mr. Chambers provided legal advice. During a

subsequent call, Mr. Chambers provided additional legal advice based on confidential

PacketVideo information obtained from Mr. Espelien, and after conducting legal research and

consulting with firm colleagues. Throughout their meeting, Mr. Espelien understood and believed

that the substantial confidential information he revealed—and the legal advice he obtained—

would be treated in confidence as a privileged communication between attorney and client, and

Mr. Chambers never indicated otherwise.

Because PacketVideo decided to file the present action in its home district, the Southern

District of California, Mr. Espelien ultimately decided to not use McKool Smith, a well known

Texas firm specializing in patent cases in the Eastern District of Texas. PacketVideo filed its

Complaint on July 27, 2011 (D.I. 1). The following week, McKool Smith contacted both

Mr. Espelien and PacketVideo's outside counsel to advise that, with full knowledge of Mr.


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Chambers' prior confidential discussions, McKool Smith intended to pitch Spotify for the chance

to represent it in this litigation. And while McKool Smith claimed that its prior discussions with

Mr. Espelien did not create a conflict that would prevent their being able to represent Spotify,

Mr. Chambers asked Mr. Espelien to agree that an ethical wall would eliminate any issue (a

request that Mr. Espelien rejected). On August 11, 2011, PacketVideo's counsel wrote to McKool

Smith to confirm Mr. Espelien's refusal, explaining that because it would be unethical for McKool

Smith to act adverse to its former client, PacketVideo would not agree to waive McKool Smith's

conflict of interest. Declaration of Christopher A. Mathews ("Mathews Decl.") Exh. A, ¶ 3.1

On September 6, 2011, once Spotify filed its Answer (D.I. 14), PacketVideo learned for

the first time that attorneys from McKool Smith's Dallas office—the same office where

Mr. Chambers is located—were representing Spotify in this action leaving Plaintiff with no choice

but to file this motion since McKool Smith, through its privileged conversation with Plaintiff's

General Counsel, is aware of Plaintiff's settlement strategy and other privileged issues identified in

its General Counsel's declaration which will be filed in camera if the Court so approves.2

The California Rules of Professional Conduct mandates automatic disqualification of the

entire McKool Smith law firm. This was made clear most recently in Laryngeal Mask Co. Ltd. v.

Ambu A/S, No. 07-CV-1988-DMS (NLS), 2008 WL 558561 (S.D. Cal. Feb. 25, 2008), a recent

Southern District of California decision—of which McKool Smith was previously advised, see

1 As with the Declaration of Mr. Espelien, see n. 2, infra, PacketVideo has filed with a Motion to Seal the unredacted version of Mr. Mathews' Declaration. PacketVideo has electronically filed a redacted version of Mr. Mathews' Declaration for the public record.

2 For the Court's in camera review, PacketVideo has filed with a Motion to Seal the unredacted version of Mr. Espelien's Declaration, which describes in detail the specific confidences and legal advice shared between Mr. Espelien and Mr. Chambers during McKool Smith's representation of PacketVideo in July 2011. In the present motion, which is filed without redaction, PacketVideo sets forth only general topics of discussion, lest disclosure of more specific information defeat the entire purpose of this Motion. See, e.g., Laryngeal, 2008 WL 558561, at *5 ("in camera review is an appropriate method for a moving party to present its evidence concerning the confidences and legal advice discussed at the preliminary interview," whereas "Plaintiffs are not required to remind Defendants of specific statements that constitute confidences in order to meet their burden of proof on the disqualification motion.") (citations omitted). PacketVideo has electronically filed a redacted version of Mr. Espelien's Declaration for the public record.


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Mathews Decl., Exh. A—disqualifying an entire law firm based on strikingly similar

circumstances to those presented here. In Laryngeal, the Plaintiff met with attorneys to discuss a

potential patent infringement action, just as PacketVideo's General Counsel met with McKool

Smith here. Id. at *1. And while in both cases the Plaintiff revealed confidential information and

received legal advice in return, in the present situation, McKool Smith's attorney went even

further—Mr. Chambers obtained confidential information and provided legal advice over several

days and multiple phone calls, consulted with colleagues in his Dallas office, and conducted

specific legal research for the sole purpose of providing legal advice on a critical strategic

question. Id. And just as in Laryngeal, after attempting to erect an ethical screen around the

attorneys who met with the Plaintiff, attorneys from the same office of the same firm appeared on

behalf of Defendants in the very same action, just as McKool Smith has done here on behalf of

Spotify. Id. at *3.

Applying California law, this Court in Laryngeal held that the client's disclosure of

confidential information, and the receipt of legal advice, necessarily established an attorney-client

relationship between the Plaintiff and the attorneys at the meeting, automatically disqualifying

those attorneys from representing the Defendant in the very same action. Id. at *6. The court

further explained that California law mandated vicarious disqualification of the attorneys' entire

law firm, regardless of any efforts to erect an ethical wall. Id. at *7. Finally, the Laryngeal court

found that, despite Defendant's arguments to the contrary, in California an ethical wall does not

prevent vicarious disqualification when another attorney from a firm's same office had represented

the opposing side in the very same action. Id.

For the same reasons explained in Laryngeal, and explored at length in PacketVideo's prior

correspondence to McKool Smith (Mathews Decl., Exh. A), PacketVideo respectfully requests

that the Court prevent this "most egregious conflict of interest" and disqualify the entire McKool

Smith law firm from representing Spotify in connection with this action.3

3 Earlier on September 6, 2011, counsel for PacketVideo had worked with James Hardin, an attorney at Spotify's counsel, Newport Trial Group, to negotiate and prepare a Joint Motion for



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II. STATEMENT OF FACTS

A. PacketVideo And Mr. Chambers, a Partner in McKool Smith's Dallas Office, Arranged A Phone Call To Discuss PacketVideo's Patent Infringement Action Against Spotify

Because Spotify first began to offer its music streaming services in the Netherlands,

starting in 2007, and PacketVideo (through its wholly-owned Swiss subsidiary) brought a patent

infringement action against Spotify in the Netherlands (on a related European patent) earlier this

year. The present lawsuit involves Spotify's infringement of U.S. Patent No. 5,636,276 ("the '276

patent") through the music streaming service Spotify recently began to offer in the United States,

in July 2011.

PacketVideo began to suspect several months ago that Spotify was preparing to offer its

music streaming service in the United States. In early July of 2011, believing the launch of

Spotify's service in the Unites States was then imminent, PacketVideo General Counsel Joel

Espelien began the search for counsel to represent PacketVideo in a patent infringement action

based on its infringement of the '276 patent. Declaration of Joel Espelien ("Espelien Decl."), ¶¶ 2-

4. For confidential reasons described in Mr. Espelien's Declaration, McKool Smith was the first

and only law firm Mr. Espelien considered to represent PacketVideo. Espelien Decl., ¶ 5. After

substantial research, Mr. Espelien was very impressed with McKool Smith and, in particular, with

Garret W. Chambers, a Principal in the firm's Dallas office and an experienced patent litigator.

Initially, Mr. Espelien contacted Mr. Chambers by email to determine whether McKool

Smith would be interested in representing PacketVideo in this action. Espelien Decl., ¶¶ 5-6. On

July 5, 2011, Mr. Chambers called Mr. Espelien and explained he and McKool Smith were

Temporary Stay (D.I. 13). While Mr. Hardin stated that he intended to file answers on behalf of Spotify, at no time did Mr. Hardin indicate that McKool Smith would appear as counsel of record on Spotify's answer. While PacketVideo still believes that good cause exists for the requested 90 day stay—to allow the parties to continue their settlement discussions—because of the sensitive and confidential nature of the strategic information shared with McKool Smith, and the seriousness of the conflict issues created by McKool Smith's current representation of Spotify, PacketVideo respectfully requests that the Court hear the present motion to disqualify even if the Court otherwise agrees to grant the parties' request for a temporary stay of this action.


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interested, but first needed to run a conflicts check to verify there was no reason McKool Smith

could not represent PacketVideo. To enable Mr. Chambers to run the conflicts check,

Mr. Espelien explained that the action would be against Spotify based on its infringement of the

'276 patent. Espelien Decl., ¶ 7. Mr. Chambers and Mr. Espelien ultimately arranged a July 7,

2011 meeting via phone to discuss specific details about PacketVideo's action against Spotify.

Espelien Decl., ¶ 8.

B. In His July 7, 2011 Call With Mr. Chambers, PacketVideo's General Counsel Disclosed Privileged And Confidential Information, And Obtained Legal Advice, Concerning This Action

During a July 7, 2011 telephone call, Mr. Espelien and Mr. Chambers spoke privately for

approximately 45 minutes. Espelien Decl., ¶ 8. After Mr. Chambers explained there were no

potential conflicts of interest to prevent McKool Smith from representing PacketVideo against

Spotify, he and Mr. Espelien spent essentially the entire call discussing strategic considerations

and/or legal issues concerning this action. Espelien Decl., ¶ 9. Importantly, at no point during the

meeting did Mr. Chambers ever warn or suggest that Mr. Espelien should not share confidential or

strategically sensitive information about PacketVideo's planned action against Spotify. Espelien

Decl., ¶ 10. In fact, Mr. Chambers actively sought confidential information from Mr. Espelien at

several points during the call. With the understanding and belief that their conversation was a

privileged and confidential communication between an attorney and client, Mr. Espelien

proceeded as he would in any other discussion with counsel; namely, he intentionally revealed

substantial privileged and confidential information to Mr. Chambers, and Mr. Chambers provided

legal advice based on the information he was provided. Espelien Decl., ¶¶ 10-11.

As described in greater detail in the unredacted version of Mr. Espelien's Declaration,

during the meeting Mr. Espelien disclosed privileged and confidential information—and obtained

Mr. Chambers' legal advice—on a range of important issues concerning this action:

• Mr. Espelien revealed confidential information concerning the general context of

PacketVideo's action against Spotify. Espelien Decl., ¶ 12.


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• Mr. Chambers sought—and Mr. Espelien disclosed—confidential information

regarding the ultimate objective of the action. Espelien Decl., ¶ 13.

• Mr. Espelien revealed confidential information with respect to PacketVideo's

estimate of the value of the '276 patent, and its strategic settlement position vis-à-

vis Spotify. Espelien Decl., ¶ 14.

• Mr. Espelien disclosed confidential strategic information about the specific timing

of PacketVideo's action against Spotify. Espelien Decl., ¶¶ 8, 15.

• Mr. Espelien revealed confidential information concerning potential forums for

PacketVideo's action against Spotify. Mr. Chambers sought—and Mr. Espelien

disclosed—information about PacketVideo's operations. Using this information,

Mr. Chambers provided his legal advice. Together, Mr. Espelien and

Mr. Chambers reached a conclusion concerning potential forums for this action.

Espelien Decl., ¶¶ 20-21.

• Mr. Espelien revealed confidential strategic information regarding potential venues

for this action. Mr. Chambers sought—and Mr. Espelien disclosed—information

concerning Spotify's and PacketVideo's operations. Based on this information,

Mr. Chambers provided legal advice concerning potential venues. Espelien Decl.,

¶¶ 16-18. However, to enable Mr. Chambers to provide more definitive legal

advice on this important question, Mr. Chambers advised Mr. Espelien that he

would further discuss the venue question with his colleagues. Espelien Decl., ¶ 19.

As revealed in a voicemail left by Bradley Caldwell, another partner in the Dallas

office of McKool Smith, Mr. Chambers apparently shared this strategic information

regarding potential venues for this action with others in his office. Declaration of

Christopher A. Mathews ("Mathews Decl.") ¶ 2.4

4 As with the Declaration of Mr. Espelien, PacketVideo has filed under seal the unredacted version of Mr. Mathews' Declaration, which includes a transcription of Mr. Caldwell's August 4,



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Throughout their meeting, Mr. Espelien understood and believed that the confidential

information he revealed—and the legal advice he obtained—would be treated in confidence as a

privileged communication between attorney and client, and Mr. Chambers never said or did

anything to suggest otherwise. Rather, Mr. Espelien's belief was reaffirmed by the proposed next

step—namely, Mr. Chambers would confer with his colleagues concerning the question of venue,

in light of the confidential information Mr. Espelien had revealed, and would get back to

Mr. Espelien shortly with more definitive legal advice. Mr. Espelien was thoroughly impressed

with Mr. Chambers, and he expected McKool Smith would represent PacketVideo in its action

against Spotify, depending on certain outstanding issues. Espelien Decl., ¶ 22.

C. McKool Smith Created Work Product, And Provided PacketVideo With Specific Legal Advice About This Action In A Follow-Up Call

Immediately following the call, Mr. Espelien researched the venue issue in light of the

information Mr. Chambers had provided during the call, and ultimately came to a tentative

conclusion. That same day, Mr. Espelien sent Mr. Chambers an email explaining his tentative

conclusion, asking Mr. Chambers to confirm that his conclusion was correct. Espelien Decl.,

Ex. 1, ¶ 23.

Soon thereafter, Mr. Chambers called Mr. Espelien and they spoke privately again by

phone. Espelien Decl., ¶ 24. During this follow-up call, Mr. Chambers confirmed that he had

discussed the venue question with his colleagues, and expressed his resulting legal advice in

response to the specific questions Mr. Espelien had posed. Mr. Espelien understood and believed

that Mr. Chambers was providing his informed legal advice, based on work product that included

Mr. Chambers' legal research and discussions with his colleagues, and Mr. Espelien expected this

legal advice would be treated as privileged and confidential. Id.

In light of the legal advice he received, Mr. Espelien disclosed more privileged and

confidential information concerning PacketVideo's operations and potential venues for its action

2011 voicemail message to Mr. Mathews. That Mr. Chambers had shared confidential information with others at his firm is evident from Mr. Caldwell's voicemail.


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against Spotify. See, generally, Espelien Decl., ¶¶ 14-24. Before ending the call, Mr. Espelien

thanked Mr. Chambers for his advice, and explained he would need to think further about the

appropriate venue and most suitable counsel to represent PacketVideo for this action. Espelien

Decl., ¶ 25.

D. After PacketVideo Retained Alternative Counsel, McKool Smith Switched Sides And Appeared On Behalf Of Spotify In This Action

Based on the legal advice he received, Mr. Espelien chose to expand his search for suitable

counsel to represent PacketVideo in its action against Spotify. Mr. Espelien interviewed several

other law firms, ultimately appointing PacketVideo's current counsel—Quinn Emanuel—to bring

this action against Spotify in the Southern District of California. Later in July, Mr. Chambers

contacted Mr. Espelien expressing continued interest in representing PacketVideo, but

Mr. Espelien had already shifted his efforts and therefore did not respond. Espelien Decl., ¶ 26.

PacketVideo filed this action against Spotify on July 27, 2011. On August 2, 2011,

Mr. Chambers sent an email followed by increasingly persistent phone messages indicating he

needed to talk to Mr. Espelien. When they finally spoke over a bad cell phone connection,

Mr. Chambers quickly explained that McKool Smith intended to represent Spotify in this very

action, and that he just wanted to make sure Mr. Espelien would not have any objection. Taken

aback, Mr. Espelien immediately recognized the serious conflict of interest this situation

presented, and was especially shocked that Mr. Chambers would seek oral agreement on such an

important issue over the phone. Mr. Espelien explained to Mr. Chambers that, given the extensive

conversations they had shared concerning PacketVideo's strategy concerning a patent infringement

lawsuit against Spotify, he was certainly not comfortable with Mr. Chambers having any

involvement in Spotify's representation in the present action. Espelien Decl., ¶ 27.

Tellingly, Mr. Chambers acknowledged the conflict of interest created by his discussions

with Mr. Espelien, explaining he understood Mr. Espelien's concerns, and that this was why

McKool Smith would implement an ethical wall to screen Mr. Chambers off from the firm's

representation of Spotify. Although Mr. Chambers was unclear during the call about what exactly

he wanted from Mr. Espelien, at no time did he ask for a waiver of the conflict of interest, and


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Mr. Espelien never agreed to provide one. Espelien Decl., ¶ 27. Mr. Espelien ended the call

explaining he was still unsure of what he was being asked for, but that if Mr. Chambers was

requesting a waiver of McKool Smith's conflict of interest based on the imposition of an ethical

wall, Mr. Chambers needed to send the waiver in writing and Mr. Espelien would review it.

Espelien Decl., ¶ 27.

On August 4, 2011, another McKool Smith attorney, Bradley Caldwell, contacted

PacketVideo's outside trial counsel, leaving a voicemail message. Mathews Decl., ¶ 2. In his

message, Mr. Caldwell acknowledges that Mr. Chambers discussed with Mr. Espelien the

possibility of bringing an action against Spotify, confirms his receipt (apparently from

Mr. Chambers) of confidential strategic information that Mr. Espelien revealed regarding potential

venues for this action, confirms the possibility that Mr. Chambers' discussions with Mr. Espelien

could raise a conflict of interest for McKool Smith, and requests that PacketVideo's counsel get

back to him because they would like to "pitch…the Spotify side of the case" but didn't "want to

put them in a bad situation where everybody's briefing some disqualification motion." Id.

After consultation with his counsel at Quinn Emanuel and also with his PacketVideo

colleagues, Mr. Espelien understandably concluded he was not comfortable with McKool Smith

representing Spotify. Based on his phone conversation with Mr. Chambers, Mr. Espelien expected

Mr. Chambers to send a formal written request for a conflict waiver, and in response Mr. Espelien

planned to tell Mr. Chambers that he would not waive the conflict of interest. But on August 9,

Mr. Espelien received only a very brief email from Mr. Chambers, describing an internal draft of

an ethical wall memorandum that McKool Smith apparently intended to implement in an effort to

insulate the firm from Mr. Chambers' clear conflict of interest. Espelien Decl., Ex. 2, ¶ 28.

Despite mischaracterizing the earlier phone conversation by incorrectly suggesting Mr. Espelien

would agree to McKool Smith's representation of Spotify if Mr. Chambers were screened off by

an ethical wall, Mr. Chambers' email also reaffirms the clear conflict of interest should

Mr. Chambers himself be involved in the representation of Spotify: "As I mentioned, we were

certain there would not be a conflict for my firm if other McKool Smith lawyers wanted to

represent Spotify…I am glad you did not see any issue provided I did not work on the case." Id.


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Yet, rather than requesting a formal written waiver of this clear conflict, Mr. Chambers' email

simply concludes: "my colleagues are proceeding to work with Spotify." Id.

Recognizing the quickly escalating situation, Mr. Espelien forwarded the email to

PacketVideo's current counsel, pointing out Mr. Chambers' mischaracterization of his phone

conversation and instructing that PacketVideo was not willing to waive the conflict of interest

under any circumstances. On August 11, 2011, PacketVideo's counsel, Fred Lorig, contacted

Mr. Chambers on PacketVideo's behalf. Mathews Decl., Ex. A, ¶ 3. Mr. Lorig's letter

unambiguously states: "given McKool Smith's exposure to PacketVideo's litigation strategy and

evaluation of the merits, PacketVideo is not willing to waive McKool Smith's conflict of interest."

Id.

On August 18, 2011, James Hardin, an attorney at Newport Trial Group, negotiated an

extension of time until September 6, 2011, to answer the complaint, and the Newport Trial Group

firm filed a motion for an extension of time on behalf of Spotify. (D.I. 9) McKool Smith did not

appear as counsel of record for Spotify on this motion. Thereafter, the Newport Trial Group and

Plaintiff's counsel agreed to file a joint motion to stay this case to allow the parties to discuss

settlement. Shortly after that stipulation was filed with the Court, McKool Smith filed an answer

in this case thus necessitating this motion. Thus., despite Mr. Chambers' acknowledgement of this

clear conflict of interest, and PacketVideo's justified refusal to grant a waiver, attorneys from

Mr. Chambers' McKool Smith Dallas office formally appeared on the other side of this action in

the Answer of Defendant Spotify USA, Inc. and Spotify Limited to Complaint, filed on

September 6, 2011, leaving PacketVideo with no choice but to bring the present Motion to

Disqualify McKool Smith.

III. ARGUMENT

A. California Law Governs Whether McKool Smith, As Prior PacketVideo Counsel, Can Switch Sides To Represent Spotify In This Action

All attorneys from any jurisdiction appearing before this Court are "subject to California

law as it pertains to professional conduct." Lucent Tech. Inc. v. Gateway, Inc., No. 02CV2060-


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B(CAB), 2007 WL 1461406, at *2 (S.D. Cal. May 15, 2007) (disqualifying entire firm because

"disqualification is required under California law, and consistent with Ninth Circuit analyses" with

regard to "an imputed conflict created in the context of a single on-going litigation"); see also Cal.

R. Prof. Conduct 1-100 (D) (2) ("As to lawyers from other jurisdictions who are not members:

These rules shall also govern the activities of lawyers while engaged in the performance of lawyer

functions in this state"); S.D. Cal. Civ. R. 83.4 (b) ("Any attorney permitted to practice in this

court must be familiar with and comply with the standards of professional conduct required of

members of the State Bar of California, and decisions of any court applicable professional conduct

which are now adopted as standards of professional conduct of this court").

Accordingly, "[m]otions to disqualify counsel are decided under [California] state law."

Hitachi, Ltd. v. Tatung Co., 419 F. Supp. 2d 1158, 1160 (N.D. Cal. 2006) (applying "established

rule in California [] that where an attorney is disqualified from representing a client because that

attorney had previously represented a party with adverse interests in a substantially related matter

that attorney's entire firm must be disqualified as well, regardless of efforts to implement an

ethical wall"); see also Laryngeal, 2008 WL 558561 (applying California law to disqualify entire

firm, despite recognizing at n. 6 that ethical rules of District of Columbia, where attorneys in

question practiced, might not require disqualification); Henriksen v. Great America Savings and

Loan et al., 11 Cal. App. 4th 109, 113 (1992) (upholding vicarious disqualification of entire law

firm under California law "where an attorney is disqualified because he formerly represented and

therefore possesses confidential information regarding the adverse party in the current litigation").

Subject to and consistent with California law, "the decision to disqualify counsel for

conflict of interest is within the trial court's discretion." Hitachi, 419 F.Supp.2d at 1160. In

exercising this discretion, the "paramount concern must be to preserve public trust in the

scrupulous administration of justice and the integrity of the bar." SpeeDee, 20 Cal. 4th at 1145.

And "it is axiomatic that an attorney must avoid even the appearance of a conflict of interest."

Laryngeal, 2008 WL 558561, at *1 (citation omitted) (disqualifying entire law firm "because

Plaintiffs have shown that they revealed confidential information and obtained legal advice during

the preliminary interview which prevents the law firm from representing Defendants in the same


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action"). To preserve the public trust and avoid even the appearance of conflict of interest,

McKool Smith must be disqualified from switching sides to represent Spotify in this action.

B. McKool Smith Formed An Attorney-Client Relationship With PacketVideo When It Obtained Confidential Information And Provided Legal Advice, Barring Its Representation Of Spotify In This Action

"It is well established that a lawyer's fiduciary obligations exist 'even in the earliest stages

of the relationship,' including 'preliminary consultations by a prospective client with a view to

retention of the lawyer, although actual employment does not result.'" Laryngeal, 2008 WL

558561, at *3 (quoting SpeeDee, 20 Cal. 4th 1135); see also Beery v. State Bar, 43 Cal. 3d 802,

811-12 (1987); In re Dupont's Estate, 60 Cal. App. 2d 276, 288-89 (1943) (noting universal

acceptance that communication by client of preliminary statement of his case to an attorney is

privileged even if the attorney is not hired). Regardless of the timing, "[w]hen a party seeking

legal advice consults an attorney at law and secures that advice, the relation of attorney and client

is established prima facie." SpeeDee, 20 Cal. 4th at 1148 (quotation and citation omitted).

Above all else, "[t]he primary concern is whether and to what extent the attorney acquired

confidential information." SpeeDee, 20 Cal. 4th at 1148. ("An attorney represents a client–for

purposes of a conflict of interest analysis–when the attorney knowingly obtains material

confidential information from the client and renders legal advice or services as a result."); see also

Laryngeal, 2008 WL 558561, at *4 n. 5 (reviewing cases from other jurisdictions and concluding

California rule was consistent in determining existence of attorney-client relationship based on

exchange of confidential information and/or legal advice at initial consultation); Henriksen, 11

Cal. App. 4th at 112-13 (upholding disqualification of entire firm where partners received some

confidential information in brief, exploratory discussion about possibly hiring the firm).

During their July 7th call, Mr. Espelien—on behalf of PacketVideo—knowingly and

intentionally revealed confidential information to Mr. Chambers on a range of strategic issues

concerning PacketVideo's present action against Spotify, including the general context of this

action, the ultimate objective of this action, PacketVideo's estimate of the value of the '276 patent

and its strategic settlement position with respect to this action, the specific timing of the action,


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potential forums for this action, and potential venues for this action. And Mr. Espelien reasonably

believed and understood the confidential information he revealed would be treated as such—

throughout multiple discussions, Mr. Chambers never warned Mr. Espelien not to disclose

confidential information, and, in some cases, actively sought such information. Moreover,

Mr. Chambers provided legal advice on several of the topics they discussed. With respect to the

question of venue, Mr. Chambers actually went so far as to discuss the situation with his

colleagues (including his partner, Mr. Caldwell), conduct research of relevant case law, and then

report back with his resulting conclusion to Mr. Espelien on a follow-up call.

In short, there can be no legitimate dispute as to whether Mr. Espelien disclosed

confidential information to, and obtained legal advice from, Mr. Chambers concerning

PacketVideo's present action against Spotify, all with the reasonable belief the information and

advice would be kept in strict confidence. Mr. Chambers admitted as much in his August phone

call to Mr. Espelien, and in his subsequent email to Mr. Espelien. Hence, PacketVideo and

McKool Smith formed an attorney-client relationship, and Mr. Chambers (and those with whom

he discussed the case) are "automatically disqualified from representing [Spotify] in the same

litigation." Laryngeal, 2008 WL 558561, at *6.

C. California Law Mandates Vicarious Disqualification Of The Entire McKool Smith Law Firm, Regardless Of Efforts To Erect An Ethical Wall

"The established rule in California is that where an attorney is disqualified…that attorney's

entire firm must be disqualified as well, regardless of efforts to erect an ethical wall." Hitachi,

419 F. Supp. 2d at 1161 (reviewing California state and Federal decisions and concluding "as a

matter of California law…ethical screening procedures cannot prevent vicarious disqualification");

see also Lucent, 2007 WL 1461406, at *2 ("California courts generally have not allowed a law

firm to avoid vicarious disqualification by implementing a screening procedure"); Laryngeal, 2008

WL 558561, at *7 ("When an attorney is disqualified due to a relationship that amounts to prior

representation on the same lawsuit, then the entire firm is disqualified") (citing Flatt v. Superior

Court, 9 Cal. 4th 275 (1994)); Henriksen, 11 Cal. App. 4th at 113-114 ("As a general rule in


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California, where an attorney is disqualified from representation, the entire law firm is vicariously

disqualified as well"); SpeeDee, 20 Cal. 4th at 1146 ("A presumption that an attorney has access to

privileged and confidential matters relevant to a subsequent representation extends the attorney's

disqualification vicariously to the attorney's entire firm."). Under established California law,

Mr. Chambers' serious conflict of interest mandates vicarious disqualification of the entire

McKool Smith law firm, and no effort to erect an ethical wall can change that.

"Even if California law permitted ethical walls to prevent disqualification of other

attorneys in a law firm, [] Court[s] would not extend that exception to th[e] case where the lawyers

are in the same [] office and the clients are opponents in the same patent litigation." Laryngeal,

2008 WL 558561, at *7 (citing In re County of Los Angeles, 223 F.3d 990 (9th Cir. 2000)

("SpeeDee Oil was the kind of case most likely to give rise to automatic disqualification because

the same firm represented adverse parties in the same litigation")); see also City of Nat'l Bank v.

Adams, 96 Cal. App. 4th 315, 327-28 (2002) (even if limited exception available, it does not apply

to adverse representation on same matter); Analytica, Inc. v. NPD Research, Inc., 708 F.2d 1263,

1267 (7th Cir. 1983) (ethical wall exception is not available when "the firm itself changed sides");

Henriksen, 11 Cal. App. 4th at 111-15 (1992) (imputed disqualification was "clear cut" when new

associate had worked on same case but had been screened, despite hardship of hiring new counsel

on eve of trial). Hence, even if California were going to permit use of ethical walls in certain

circumstances, the entire McKool Smith law firm must still be disqualified from representing

Spotify because Mr. Chambers represented PacketVideo in this very same action—a classic and

clearly impermissible case of switching sides.

IV. CONCLUSION

For the foregoing reasons, PacketVideo respectfully asks that the Court grant this Motion

to Disqualify the entire McKool Smith law firm, and enter an order forbidding McKool Smith

from representing Spotify in this litigation, from consulting or sharing any work product with


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Spotify's new counsel, or from otherwise directly or indirectly assisting Spotify in its defense of

this lawsuit in any way.

DATED: September 6, 2011 QUINN EMANUEL URQUHART & SULLIVAN, LLP

By /s/ Christopher A. Mathews Christopher A. Mathews

Attorneys for Plaintiff PACKETVIDEO CORPORATION


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CERTIFICATE OF SERVICE

The undersigned hereby certifies that a true and correct copy of the foregoing document

has been served on September 6, 2011 to all counsel of record who are deemed to have consented

to electronic service via the Court's CM/ECF system per Fed. R. Civ. P. 5(b)(3) and Civil Local

Rule 5.4. Any other counsel of record will be served by electronic mail, facsimile and/or

overnight delivery.

/s/ Christopher A. Mathews

Christopher A. Mathews [email protected] Attorneys for Plaintiff PACKETVIDEO CORPORATION


EXHIBIT F

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- 1 - 11cv1659


SOUTHERN DISTRICT OF CALIFORNIA

PACKETVIDEO CORPORATION, aDelaware corporation,

Plaintiff,

CASE NO. 11cv1659 - IEG (WMc)

ORDER GRANTING MOTIONFOR WITHDRAWAL

[Doc. No. 30]vs.

SPOTIFY USA INC., a Delawarecorporation; SPOTIFY LIMITED, a UnitedKingdom corporation; and SPOTIFYTECHNOLOGY SARL, a Luxembourgcorporation,

Defendants.

Presently before the Court is Defendants’ motion to withdraw Mike McKool Jr., Bradley

W. Caldwell, Justin Nemunaitis and the law firm McKool Smith P.C. as counsel for Defendants.

[Doc. No. 30.] The motion notes that Scott J. Ferrell, James B. Hardin, and the law firm Newport

Trial Group will continue as counsel for Defendants. Pursuant to Civil Local Rule 83.3(g) and for

good cause shown, the Court GRANTS Defendant’s motion.

IT IS SO ORDERED.

DATED: September 28, 2011 _________________________________

IRMA E. GONZALEZ, Chief JudgeUnited States District Court

______________________ ____________________________________ ____________________________ _________________________________________ ___________________________________________ _______________ ______________

IRMA E. GONZALEZ, ChChChChChChChChChChChChChChChhCCC ief Judgdgdgdgdgdgdgdgdgdgdgdgdgdgdgdgdgdgdgdgei S i i C

Case 3:11-cv-01659-IEG-WMC Document 32 Filed 09/28/11 Page 1 of 1

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RESPONSES TO OBJECTIONS TO PLAINTIFF’S EVIDENCE ISO MOTION TO DISQUALIFY

LEE TRAN & LIANG APLC K. Luan Tran (SBN 193808) James M. Lee (SBN 192301) Cyrus Khojandpour (SBN 260233) Lisa J. Chin (SBN 259793) 601 S. Figueroa Street, Suite 3900 Los Angeles, CA 90017 Tel. 213-612-3737 / Fax. 213-612-3773 RAY A. MANDLEKAR, ATTORNEY AT LAW Ray A. Mandlekar (SBN 196797) 601 S. Figueroa Street, Suite 4050 Los Angeles, CA 90017 Tel. 213-785-6130 / Fax. 213-254-9001

Attorneys for Plaintiff Frank Reginald Brown, IV




Plaintiff,


Defendants.

CASE NO: BC501483 Assigned for all purposes to the Honorable John L. Segal (Dept. 50) PLAINTIFF’S RESPONSES TO DEFENDANTS’ OBJECTIONS TO PLAINTIFF’S EVIDENCE IN SUPPORT OF MOTION TO DISQUALIFY DEFENDANTS’ COUNSEL QUINN EMANUEL URQUHART & SULLIVAN LLP [Plaintiff’s Reply in Further Support of Motion to Disqualify, Objections to Declarations of Joseph C. Sarles and Robert Kehr, and Request For Judicial Notice filed concurrently herewith] Hearing: Date: August 1, 2013 Time: 8:30 a.m. Dept.: 50 Action Filed: February 21, 2013 Trial Date: Not Assigned Yet

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OBJECTIONS AND RESPONSES TO OBJECTIONS TO DECLARATION OF FRANK REGINALD BROWN IV

COURT’S RULING

MATERIAL OBJECTED TO:

GROUNDS FOR OBJECTION:

RESPONSE TO OBJECTION:

RULING ON OBJECTION:

Brown Decl., ¶ 6: The only communication that took place regarding this document was a short email from Mr. Alden summarizing the document in which he downplayed the potential of any conflict by characterizing the possibility of Quinn Emanuel taking an adverse interest to me down the road as “unlikely.” He also assured me that the likelihood of this ever happening is [sic] “small” and this was just “a precaution we need to take.”

Cal. Evid. Code § 1523 (testimony not admissible to prove the content of a writing). Although Brown possesses this document, he did not provide it. Defendants submitted it as Exhibit A to the Alden Declaration.

Cal. Evid. Code § 1523 states that oral testimony is not admissible to prove the content of a writing. Mr. Brown’s statement is not used or intended to prove the content of the email. Rather, Plaintiff cites ¶ 6 for the proposition that the communication was the only one regarding an advance waiver. Regardless, Plaintiff does not object to the email submitted as Exhibit A to the Alden Declaration, which reflects exactly what Plaintiff states in ¶ 6 of his declaration.

Sustained: ___

Overruled: ___

Brown Decl., ¶ 10: During the above oral and written communications, Mr. Alden and I discussed in detail the strengths and weakness of my case. In addition, our discussions involved many important and strategic issues related to the litigation. Mr. Alden offered his suggestions and gave me legal advice accordingly. In addition, Mr. Alden and I discussed my finances and how costs of litigation would be handled with respect to Quinn Emanuel.

Cal. Evid. Code § 1523 (testimony not admissible to prove the content of a writing). To the extent Brown’s testimony is characterizing the content of email communications, it is inadmissible.

Cal. Evid. Code § 1523 states that oral testimony is not admissible to prove the content of a writing. Mr. Brown’s statement is not used or intended to prove the content of any writings. Rather, Plaintiff cites ¶ 10 for the general proposition of what was discussed between him and Mr. Alden. Moreover, Defendants do not contest the accuracy of Plaintiff’s statement in ¶ 10.

Sustained: ___

Overruled: ___

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2

OBJECTIONS AND RESPONSES TO OBJECTIONS TO DECLARATION OF FRANK REGINALD BROWN IV

COURT’S RULING





Brown Decl., ¶ 12: On or about December 12, 2012 I informed Mr. Alden that an article had been published indicating that Benchmark Capital was funding Snapchat.


Cal. Evid. Code § 1523 states that oral testimony is not admissible to prove the content of a writing. Mr. Brown’s statement is not used or intended to prove the content of any writings. Rather, Plaintiff cites ¶ 12 for the general proposition that he informed Mr. Alden of an article. Moreover, Defendants do not contest the accuracy of Plaintiff’s statement in ¶ 12.

Sustained: ___

Overruled: ___

Brown Decl., ¶ 14: On or about January 10, 2013, after over two months of consideration and multiple confidential communications, Mr. Alden informed me via email that Quinn Emanuel would not represent me “at the current time.”


Cal. Evid. Code § 1523 states that oral testimony is not admissible to prove the content of a writing. Mr. Brown’s statement is not used or intended to prove the content of any writings. Rather, Plaintiff cites ¶ 14 for the general proposition that Alden informed Plaintiff he could not represent him. Moreover, Defendants do not contest the accuracy of Plaintiff’s statement in ¶ 14.

Sustained: ___

Overruled: ___

OBJECTIONS AND RESPONSES TO OBJECTIONS TO DECLARATION OF K. LUAN TRAN

COURT’S RULING





Tran Decl., ¶ 6: Below is a sample of the evidence unearthed so far in this initial phase of discovery:…[and all bullet points that follow]

Cal. Evid. Code § 1523 (testimony not admissible to prove the content of a writing); Cal. Evid. Code § 1200 et seq. (hearsay); Cal. Evid. Code Cal. Evid. Code §§ 403, 702 (lacks foundation).

Defendants do not dispute the accuracy of Mr. Tran’s characterizations of the documents in ¶ 6. Moreover, Mr. Tran attaches to his Declaration all of the documents summarized as Exhibit C.

Sustained: ___ Overruled: ___

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COURT’S RULING





Counsel’s numerous unsupported factual assertions in this paragraph lack foundation. His argumentative characterizations of newspaper articles, documents and statements by other people are inadmissible hearsay and violate the best evidence rule. The documents, if they are admissible at all, speak for themselves.

Tran Decl., Exhibit C.

Cal. Evid. Code § 1200 et seq. (hearsay); Cal. Evid. Code § 356 (completeness). The newspaper articles in Exhibit C are all entirely inadmissible hearsay. The text message of purported statements by a third party, John Spiegel, are inadmissible hearsay. The text messages between plaintiff and defendant Spiegel are misleadingly incomplete.

Contrary to Defendants assertions, there are no newspaper articles attached as Exhibit C. Rather, Exhibit C comprises emails and text messages. Under Cal. Evid. Code § 1220, evidence of a statement is not made inadmissible by the hearsay rule when offered against the declarant in an action to which he is a party in either his individual or representative capacity. All of these communications involve Defendants and therefore admissible as party admissions.


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COURT’S RULING





Tran Decl., ¶ 8 and Exhibit D.

Cal. Evid. Code § 1200 et seq. (hearsay). This exhibit consists entirely of in admissible hearsay statements in a newspaper article. Counsel’s hearsay characterization of the newspaper article is likewise inadmissible.

Exhibit D is not hearsay because it is not offered for the truth of matter asserted. Rather, Plaintiff cites the article for the proposition that it was published. See Motion at 6:20-22 (“On or about December 12, 2012, Plaintiff informed Mr. Alden that an article had been published indicating that Benchmark Capital was funding Snapchat. Id. ¶ 12; see also Tran Dec., Exh. D.”). Moreover, Defendants do not dispute the accuracy of any of the statements in Exhibit D.


Tran Decl., ¶ 9 – In light of the foregoing and Plaintiff’s clear attorney-client relationship with the Quinn Emanuel firm….

Cal. Evid. Code §§ 403, 702 (lacks foundation); Cal. Evid. Code § 310 (legal conclusion). Counsel’s claim that plaintiff had a “clear attorney-client relationship” with Quinn Emanuel lacks foundation and is an improper legal conclusion. Moreover, it also contradicts the Waiver plaintiff signed, which expressly disclaims an attorney-client relationship. See Van Dalsem Decl., Ex. B.

Plaintiff cites ¶ 9 of the Tran Declaration for the proposition that “[u]pon learning about Quinn Emanuel’s retention, Plaintiff immediately called for a one week standstill of litigation to allow the parties to investigate the conflict and determine whether the issue could be resolved without disqualification proceedings. Tran Dec., ¶ 9. The parties then conducted two unsuccessful mediation sessions and agreed to another standstill until June 20, 2013. Id.” Motion at 8:12-16. Defendants do not dispute this fact.


Tran Decl., ¶ 10 – stating that Quinn Emanuel were plaintiff’s

Cal. Evid. Code §§ 403, 702 (lacks foundation); Cal.

Plaintiff cites ¶ 9 of the Tran Declaration for the proposition that “[a]t the June 19, 2013


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COURT’S RULING





“former attorneys”.

Evid. Code § 310 (legal conclusion). Counsel’s claim that Quinn Emanuel firm acted as plaintiff’s “former attorneys” lacks foundation and is an improper legal conclusion. Moreover, it contradicts the Waiver plaintiff signed, which expressly disclaims an attorney-client relationship. See Van Dalsem Decl., Ex. B.

Case Management Conference, the parties agreed to stay this action so that Plaintiff can move to disqualify his former attorneys, Quinn Emanuel. Id. ¶ 10.” Motion at 8:16-18. Defendants do not dispute this fact.

Tran Decl., ¶ 12 and Exhibit F

Cal. Evid. Code § 1200 et seq. (hearsay). This exhibit consists entirely of in admissible hearsay statements in a newspaper article. Counsel’s hearsay characterization of the newspaper article is likewise inadmissible.

Exhibit F is not hearsay because it is not offered for the truth of matter asserted. Rather, Plaintiff cites the article for the proposition that certain things stated in a news article, not that the statements therein are true. See Motion at 3 n.1 (“This week, it was announced that Snapchat received another $80 million from institutional investors at a valuation approaching $1 billion. Tran Decl., ¶ 12, Exh. F. It was also announced that Defendants Spiegel and Murphy each pocketed $10 million from these investors. Id.”).


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