Last month, we posted about New Jersey Magistrate Judge Bongiovanni’s decision to disqualify a lawyer for a conflict of interest under Rule of Professional Conduct 1.7, in Wyeth and Cordis Corp. v. Abbott Laboratories, et al., C.A. No. 08-230-JAP (D.N.J. Dec. 1, 2009). Magistrate Judge Bongiovanni’s holding contradicted a District of Delaware case – both cases had identical facts, but Magistrate Judge Bongiovanni held the firm disqualified, while Judge Robinson had held that, although the firm’s conduct violated Rule 1.7, the facts of the case did not warrant disqualification.
This week, New Jersey District Judge Pisano reversed Magistrate Judge Bongiovanni’s decision, and held that the attorney was not disqualified, after a discussion of the facts of the case that roughly mirrored Judge Robinson’s opinion. According to Judge Pisano, violations of Rule 1.7 do not result in mandatory disqualifiction under Third Circuit and New Jersey law. Wyeth and Cordis Corp. v. Abbott Laboratories, et al., C.A. No. 08-230-JAP, at *15 (D.N.J. Feb. 8, 2010). Judge Pisano stated that this rule is particularly appropriate because “[m]odern litigation . . . often involves multinational companies and multinational law firms among whom conflicts occasionally arise due to the broad reach of their respective businesses,” and because of the degree of prejudice that results to a party when its chosen counsel is disqualified. Id. at 9-10.