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Analytica, Inc. v. NPD Research, Inc. - 708 F.2d 1263 (7th Cir. 1983)

Rule:

A lawyer may not represent an adversary of his former client if the subject matter of the two representations is "substantially related," which means: if the lawyer could have obtained confidential information in the first representation that would have been relevant in the second. It is irrelevant whether he actually obtained such information and used it against his former client, or whether -- if the lawyer is a firm rather than an individual practitioner -- different people in the firm handled the two matters and scrupulously avoided discussing them.

Facts:

The original law firm, Schwartz & Freeman, and the trial law firm, Pressman and Hartunian, were disqualified by the district court from representing Plaintiff Analytica, Inc. in an anti-trust suit because Schwartz & Freeman had represented Defendant NPD, Inc. in a substantially related matter. Pressman and Hartunian, which was brought into the case by the Schwartz & Freeman, was disqualified because of the co-counsel relationship. Both sought review of the disqualification order. Schwartz & Freeman also sought review of an order directing it to pay NPD, Inc.’s attorney fees, and NPD, Inc. contended that it should have received more fees. Pressman and Hartunian’s appeal was dismissed for lack of jurisdiction where it lacked standing. 

Issue:

Did the district court err in disqualifying Schwartz & Freeman from representing Analytica, Inc., an adversary of NPD, Inc. which is a former client of Schwartz & Freeman in a substantially related matter?

Answer:

No

Conclusion:

The order disqualifying Schwartz & Freeman and assessing fees was affirmed where Schwartz & Freeman had represented NPD, Inc. in a substantially related matter giving it access to potentially relevant confidential data, where the law firm unreasonably contested disqualification, and where the fee award was reasonable.

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