14-2949

Boies, Schiller & Flexner LLP v. Host Hotels & Resorts, Inc.

UNITED STATES COURT OF APPEALS

FOR THE SECOND CIRCUIT

SUMMARY ORDER

RULINGS BY SUMMARY ORDER DO NOT HAVE PRECEDENTIAL EFFECT. CITATION TO A SUMMARY ORDER FILED

ON OR AFTER JANUARY 1, 2007, IS PERMITTED AND IS GOVERNED BY FEDERAL RULE OF APPELLATE

PROCEDURE 32.1 AND THIS COURT’S LOCAL RULE 32.1.1. WHEN CITING A SUMMARY ORDER IN A

DOCUMENT FILED WITH THIS COURT, A PARTY MUST CITE EITHER THE FEDERAL APPENDIX OR AN

ELECTRONIC DATABASE (WITH THE NOTATION “SUMMARY ORDER”). A PARTY CITING A SUMMARY ORDER MUST

SERVE A COPY OF IT ON ANY PARTY NOT REPRESENTED BY COUNSEL.

1 At a stated term of the United States Court of Appeals

2 for the Second Circuit, held at the Thurgood Marshall United

3 States Courthouse, 40 Foley Square, in the City of New York,

on the 11th 4 day of March, two thousand fifteen.

5

6 PRESENT: DENNIS JACOBS,

7 RAYMOND J. LOHIER, JR.,

8 Circuit Judges,

9 PAMELA K. CHEN,

District Judge.* 10

11

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13 BOIES, SCHILLER & FLEXNER LLP, 

14 Appellant,

15

16 -v.- 14-2949

17

18 HOST HOTELS & RESORTS, INC., 

Appellee.** 19

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21

* The Honorable Pamela K. Chen, United States District

Judge for the Eastern District of New York, sitting by

designation.

** The Clerk of Court is respectfully directed to amend

the official caption as set forth above.
1 FOR APPELLANT: DAVID A. BARRETT (with Donald L.

2 Flexner, Boies, Schiller &

3 Flexner LLP, Michael S. Ross,

4 Law Offices of Michael S. Ross,

5 on the brief), Boies, Schiller &

6 Flexner LLP, New York, New York.

7

8 FOR APPELLEE: KEVIN J. PERRA (with Richard M.

9 Goldstein, Jordan B. Leader, and

10 Boris Zeldin, on the brief),

11 Proskauer Rose LLP, New York,

12 New York.

13

14 Appeal from a judgment of the United States District

15 Court for the Southern District of New York (McMahon, J.).

16

17 UPON DUE CONSIDERATION, IT IS HEREBY ORDERED, ADJUDGED

18 AND DECREED that the judgment of the district court be

19 AFFIRMED. 

20

21 Boies, Schiller & Flexner LLP (“BSF”) appeals from the

22 judgment of the United States District Court for the

23 Southern District of New York (McMahon, J.), imposing

24 sanctions against it upon the motion of its former client,

25 Host Hotels & Resorts, Inc. (“Host”). We assume the

26 parties’ familiarity with the underlying facts, the

27 procedural history, and the issues presented for review. 

28

29 Host moved for sanctions on the grounds that BSF’s

30 representation of Madison 92nd Street Associates, LLC

31 (“Madison”) presented a clear conflict of interest in light

32 of BSF’s earlier, substantially related representation of

33 Host, and that BSF unreasonably refused to withdraw from its

34 representation of Host until faced with a motion to

35 disqualify. The district court agreed, concluding that “[a]

36 clearer conflict of interest cannot be imagined” and that

37 Host was entitled to fees and costs incurred in preparing

38 the motion to disqualify BSF.

39

40 Based on Host’s assertion of attorney-client privilege,

41 the specifics of the advice implicated by this appeal were

42 placed under seal in the district court and remain so here. 

43 If it is arguable that Host waived its privilege by bringing

44 its motion for sanctions, BSF has not pressed that argument. 

45 Upon review for abuse of discretion, Star Mark Mgmt., Inc.

46 v. Koon Chun Hing Kee Soy & Sauce Factory, Ltd., 682 F.3d

47 170, 175 (2d Cir. 2012) (per curiam)--and without endorsing

2
1 all of the tonalities of the district court’s opinion--we

2 affirm for substantially the reasons stated therein.

3

4 The district court’s findings and review of the record

5 support its conclusion that BSF acted “without a colorable

6 basis” for maintaining it had no conflict of interest until

7 it was faced with the motion to disqualify. Enmon v.

8 Prospect Capital Corp., 675 F.3d 138, 143 (2d Cir. 2011). 

9 The court’s finding that BSF provided to its outside ethics

10 counsel an unreasonably narrow description of its work for

11 Host is itself sufficiently indicative of bad faith. And

12 the court made other factual findings, including that: BSF

13 accepted the Madison engagement without reviewing its

14 billing records or files pertaining to its prior

15 representation of Host; represented to Host and its outside

16 counsel that it had no conflict before completing its review

17 of its files; filed the Madison complaint before completing

18 its internal document review and production of documents to

19 Host; and, willfully refused to recognize the obvious

20 conflict. See Gollomp v. Spitzer, 568 F.3d 355, 368-74 (2d

21 Cir. 2009) (concluding district court’s findings and review

22 of the record supported its conclusion that plaintiff’s

23 conduct was “akin to bad faith”). 

24

25 In sum, contrary to BSF’s argument, the court concluded

26 BSF’s conduct was “far, far worse” than mere negligence. 

27 See DLC Mgmt. Corp. v. Town of Hyde Park, 163 F.3d 124, 136

28 (2d Cir. 1998) (“[T]hese findings [are] sufficiently concise

29 and based on clear evidence so as to amount to the bad faith

30 required to impose sanctions.”).

31

32 For the foregoing reasons, and finding no merit in

33 BSF’s other arguments, we hereby AFFIRM the judgment of the

34 district court.

35

36 FOR THE COURT:

37 CATHERINE O’HAGAN WOLFE, CLERK

38

3