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Attorney's conflict of interest imputed to law firm Iowa court rules. .

What's a plaintiff to do when litigation has begun, confidential information has been disclosed, and his or her lawyer lands a job with the law firm that represents the defense? A plaintiff identified only as Jane Doe and her parents did the one thing they could: They filed a motion requesting that the entire firm be disqualified from the lawsuit, even though it had taken steps to isolate the attorney from the case. (Doe v. Perry Cmty. Sch. Dist., 650 N.W.2d 594 (Iowa 2002).)

The Iowa Supreme Court reversed a lower court decision denying the Does' request, parting ways with state and federal courts that have ruled a law firm can dodge disqualification by showing that it had implemented sufficient screening methods to prevent disclosure of confidential information. (INA Underwriters Ins. Co. v. Rubin, 635 F. Supp. 1 (E.D. Pa. 1983); Hughes v. Paine Webber, Jackson & Curtis, Inc., 565 F. Supp 663 (N.D. Ill. 1983); Panter v. Park, 123 Cal. Rptr. 2d 599 (Ct. App. 2002).)

The Does filed suit in February 2001 against a teacher who had been convicted of sexually abusing Jane. The school district and middle school principal were also named as defendants. Soon after, the Does' attorney, Jason Palmer, joined the law firm that represented the school district and principal. Although Palmer had been disqualified from further representing the Does, the plaintiffs asked the trial court to disqualify the firm from continuing to represent the defendants as well.

The firm argued that it had put a "Chinese wall" in place: It had excluded Palmer from discussions about the case and prohibited him from accessing the case file and relevant documents. The law firm asserted that the "wall" adequately isolated Palmer from the case and protected other members of the firm from disqualification. The trial court agreed.

Reversing, the Iowa Supreme Court held that a law firm's implementing a Chinese wall is insufficient to prevent the disclosure of confidential information. "The presence or absence of a Chinese wall does not enter into our analysis," wrote Judge Michael Streit. "Any knowledge a disqualified attorney holds is imputed to the members of his or her law firm so as to disqualify the entire firm."

The court noted that although there was no evidence to suggest that either Palmer or the law firm had breached rules of ethics or professional responsibility, the firm's continued representation of the defendants "constitutes a threat to the adversarial process and creates an undeniably strong appearance of impropriety."

Paige Fiedler, a lawyer in Johnston, Iowa, and cocounsel for the plaintiffs, said, "The court understood that public confidence in the legal profession would suffer if it did not disqualify the law firm."

Streit chided the trial court for abusing its discretion. "Palmer's firm now stands as adversary against the Does in the very litigation in which Palmer first served as their trusted attorney," he wrote. "When Palmer left [his former] firm, he stopped advocating for the Does by taking a new position clearly adverse to their best interests."
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Author:Reichert, Jennifer L.
Date:Dec 1, 2002
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