Counsel Concerns

Breach of Loyalty and Confidentiality

The Court of Appeal of California, Second Appellate District, Division Five, affirmed the disqualification of a law firm from representing plaintiffs in litigation over the late singer Eva Cassidy. Straw v. Gelbard, B180606.

Under a 1997 licensing agreement, William Straw and his Blix Street Records obtained the right from Eva Cassidy's parents, Hugh and Barbara, to exploit the singer's recordings. In 2002, Blix Street and the Cassidys filed suit in Maryland federal district court to bar David Lourim from re-releasing an album by Method Actor, a band Eva Cassidy had sung with early in her career. Shortly after the complaint was filed, entertainment attorney Don Engel, Straw's long-time lawyer, began serving as counsel for both Blix Street and the Cassidys. The Cassidys later claimed they didn't know that Engel had previously represented Straw.

After a dispute arose between Straw and the Cassidys over the terms of a settlement with Lourim (in part over use of sound recordings for a movie about Eva Cassidy), the Maryland federal court granted Engel's motion to withdraw as the Cassidys counsel, then granted the Cassidy's motion to compel Engel to withdraw from representing either Blix Street or the Cassidys in the Lourim case. Several days before the latter ruling, Engel filed suit in L.A. Superior Court on behalf of Blix Street against the Cassidys and their film production partner, Allen Gelbard. The L.A. court later granted the Cassidys' motion to disqualify Engel & Engel from serving as Blix Street's counsel in the California suit, based on breaches of the duty of loyalty and confidentiality owed the Cassidys.

Affirming in an unpublished opinion, the Court of Appeal noted: 'Engel represented the Cassidys and Blix Street jointly, in litigation, then, while still counsel of record in that litigation, became Blix Street's advocate against the Cassidys on an issue that was, in the words of the federal court, 'material and centers on the core issues' in that litigation. Then, barely 90 days after he was relieved in the litigation [from representing the Cassidys], he filed suit against his former clients, on behalf of their former co-plaintiffs. ' Engel wrote [in a letter to the initial plaintiffs' counsel in the Lourim case] that the conflict between the Cassidys and Blix Street concerning the Method Actor settlement was so serious that he could no longer represent the Cassidys. [Straw and Blix Street] cannot now be heard to claim that the conflict was sufficiently unimportant that it does not preclude Engel from suing the Cassidys on Blix Street's behalf, in litigation arising out of that very conflict.'

The California-case appellants argued that Engel & Engel hadn't breached the duty of loyalty because this was a successive representation, rather than a simultaneous representation, case. But the Court of Appeal emphasized that 'if this is a successive representation case, it is so only in the most technical sense.' The Court of Appeal cited 'the longstanding rule that 'an attorney is forbidden to do either of two things after severing his relationship with a former client. He may not do anything which will injuriously affect his former client in any manner in which he formerly represented him nor may he at any time use against his former client knowledge or information acquired by virtue of the previous relationship.' '

The Court of Appeal explained that to establish breach of confidentiality, the Cassidys weren't required to show that they had confidential communications with Engel. According to the court: 'Instead, the test makes it unnecessary for the client to prove anything except that the two representations are substantially related. ' Engel's representation of the Cassidys in the Maryland litigation was direct and personal, and there was opportunity for confidences. ' Representation was not by his firm, with some other lawyer playing the major role. This was his case. ' Appellants point to the evidence that Engel only met with the Cassidys once, but once is surely enough to create an opportunity for confidential information to be exchanged ' and there was evidence that that happened. The Cassidys believed that Engel was their lawyer, and they were correct in that belief.'

Breach of Loyalty and Confidentiality

The Court of Appeal of California, Second Appellate District, Division Five, affirmed the disqualification of a law firm from representing plaintiffs in litigation over the late singer Eva Cassidy. Straw v. Gelbard, B180606.

Under a 1997 licensing agreement, William Straw and his Blix Street Records obtained the right from Eva Cassidy's parents, Hugh and Barbara, to exploit the singer's recordings. In 2002, Blix Street and the Cassidys filed suit in Maryland federal district court to bar David Lourim from re-releasing an album by Method Actor, a band Eva Cassidy had sung with early in her career. Shortly after the complaint was filed, entertainment attorney Don Engel, Straw's long-time lawyer, began serving as counsel for both Blix Street and the Cassidys. The Cassidys later claimed they didn't know that Engel had previously represented Straw.

After a dispute arose between Straw and the Cassidys over the terms of a settlement with Lourim (in part over use of sound recordings for a movie about Eva Cassidy), the Maryland federal court granted Engel's motion to withdraw as the Cassidys counsel, then granted the Cassidy's motion to compel Engel to withdraw from representing either Blix Street or the Cassidys in the Lourim case. Several days before the latter ruling, Engel filed suit in L.A. Superior Court on behalf of Blix Street against the Cassidys and their film production partner, Allen Gelbard. The L.A. court later granted the Cassidys' motion to disqualify Engel & Engel from serving as Blix Street's counsel in the California suit, based on breaches of the duty of loyalty and confidentiality owed the Cassidys.

Affirming in an unpublished opinion, the Court of Appeal noted: 'Engel represented the Cassidys and Blix Street jointly, in litigation, then, while still counsel of record in that litigation, became Blix Street's advocate against the Cassidys on an issue that was, in the words of the federal court, 'material and centers on the core issues' in that litigation. Then, barely 90 days after he was relieved in the litigation [from representing the Cassidys], he filed suit against his former clients, on behalf of their former co-plaintiffs. ' Engel wrote [in a letter to the initial plaintiffs' counsel in the Lourim case] that the conflict between the Cassidys and Blix Street concerning the Method Actor settlement was so serious that he could no longer represent the Cassidys. [Straw and Blix Street] cannot now be heard to claim that the conflict was sufficiently unimportant that it does not preclude Engel from suing the Cassidys on Blix Street's behalf, in litigation arising out of that very conflict.'

The California-case appellants argued that Engel & Engel hadn't breached the duty of loyalty because this was a successive representation, rather than a simultaneous representation, case. But the Court of Appeal emphasized that 'if this is a successive representation case, it is so only in the most technical sense.' The Court of Appeal cited 'the longstanding rule that 'an attorney is forbidden to do either of two things after severing his relationship with a former client. He may not do anything which will injuriously affect his former client in any manner in which he formerly represented him nor may he at any time use against his former client knowledge or information acquired by virtue of the previous relationship.' '

The Court of Appeal explained that to establish breach of confidentiality, the Cassidys weren't required to show that they had confidential communications with Engel. According to the court: 'Instead, the test makes it unnecessary for the client to prove anything except that the two representations are substantially related. ' Engel's representation of the Cassidys in the Maryland litigation was direct and personal, and there was opportunity for confidences. ' Representation was not by his firm, with some other lawyer playing the major role. This was his case. ' Appellants point to the evidence that Engel only met with the Cassidys once, but once is surely enough to create an opportunity for confidential information to be exchanged ' and there was evidence that that happened. The Cassidys believed that Engel was their lawyer, and they were correct in that belief.'