Court Opinion

ID: 9784972
Source: CourtListenerOpinion
Date Created: 2023-08-30 20:59:44.502385+00
Date Added: 2024-06-11T07:36:01.918965
License: Public Domain

Judge STERN
(temporarily assigned), dissenting.
The present motion should not have been determined on the papers because the certifications presented disputed issues of material fact as to whether defendant’s principal provided confidential information to plaintiffs counsel during a three-hour preliminary consultation. Thus, an evidentiary hearing was required under Dewey v. R.J. Reynolds Tobacco Co., 109 N.J. 201, 222, 536 A.2d 243 (1988). See also City of Atl. City v. Trupos, 201 N.J. 447, 463, 992 A.2d 762 (2010).
As the majority well develops, RPC 1.18, dealing with former prospective clients, is an expansion of RPC 1.9, dealing with former clients, but was intended to “protect prospective clients to a lesser extent than actual clients,” see Kevin H. Michels, New Jersey Attorney Ethics: The Law of New Jersey Lawyering § 21:2-3 at 513 (2011). RPC 1:18 does so by adding an additional limitation: disqualification is required only “if the lawyer received information from the former prospective client that could be significantly harmful to that person in the matter.” RPC 1.18(b). Thus, with respect to the other two factors under the governing test, that the current representation 1) be “materially adverse” to the interests of the former prospective client and 2) involve “the same or a substantially related matter,” ibid,., Trupos is controlling. Moreover, Trupos, supra, makes clear that “the moving party ... ‘bears the burden of proving that disqualification is justified.’ ” 201 N.J. at 463, 992 A.2d 762 (citing N.J. Div. of Youth & Family Servs. v. V.J., 386 N.J.Super. 71, 75, 898 A.2d 1059 (Ch.Div.2004)).
I have no quarrel with the majority’s interpretation of RPC 1.18 or its holding with respect to the movant’s burden. However, in my view, the issue before us is whether defendant made a sufficient showing to warrant an evidentiary hearing on its claim *132of disqualification in light of the factual dispute. In her certification in support of the motion to disqualify, Ms. Kang stated:
When I consulted with attorney Peter Lee, this was arranged by a mutual friend of ours, and we all met at the Baden Baden location at 329 Bergen Boulevard, Palisades Park, New Jersey, at one of the lower level party rooms. At that time, we discussed extensively about my business history and the pending legal disputes. We spoke [for] approximately three hours and it was my intention to retain attorney Peter Lee but, for events that were not clear to me, which transpired subsequently, it turned out that I did not retain his services.
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We discussed various aspects of the Baden Baden business, including its history and its then-present state of affairs, confidentially.
The pending lawsuit, filed by Mr. Lee on behalf of his current client, 0 Builders & Associates, Inc., is a suit that seeks significant money damages relating to the construction of my Palisades Park restaurant, Yuna Corporation, and, therefore, it is my belief that it will implicate portions of the information discussed with Mr. Lee previously when he was consulted for legal representation. If this suit prevails, somehow, and my company is unable to pay the judgment, other information disclosed by me during the previous consultation may be impinged as well, such as financial information, and managerial information.
In response, attorney Lee certified:
At the meeting, Ms. Kang requested me to substitute [for] Mr. Kimm as her attorney in the Former Action insofar as (1) the Court (Daniel P. Mecca, J.S.C.) reportedly had scheduled trial for the following Monday, February 11, 2008, and (2) for reasons not made known to me, Mr. Kimm reportedly had sought to withdraw from the Former Action and refused to represent Ms. Kang at trial. To the extent Ms. Kang did not have with her any files relating to the Former Action, I insisted that I could not make any decision until I reviewed the files and the Court adjourned the trial date for at least 30 days.
At our meeting with Dr. Lee, Ms. Kang shared no privileged or confidential information with me concerning her or defendant’s “business history,” other “pending legal disputes,” “financial information” or “then-present state of affairs,” perhaps because all communications admittedly took place in the presence of our mutual friend and third-party, Dr. Lee, and the purpose of our meeting—my representation of Ms. Kang in the Former Action—did not require such information. I made no request for and did not receive any such information at any time before, during or after the meeting of February 4, 2008.
There is no dispute that Lee declined to assume representation of the “Koryeo” matter on February 5, 2008. However, Ms. Kang further certified:
I disclosed business, financial and legal information related to Yuna [C]orp. and other matters to attorney Peter Lee that I believe to be related to the current law suit brought by O Builders, including discussion of a case called, Gigs, Inc. v. *133Kyung Hee Park, et al., Kay Park, et al. vs. Koryeo Corp., et al., and other general information about the circumstances of my business and legal affairs. Although attorney Peter Lee seems to deny knowledge of the Gigs case, we did discuss the circumstances, including various aspects of the Baden Baden business, owned by Yuna Corp.
It remains my belief that the current suit will implicate portions of the information discussed with attorney Peter Lee previously when he was consulted for legal representation.
Defendant’s position was supported by Dr. Lee who certified:
I arranged and attended a consultation between Kay Kang and Peter Lee around February, 2008, to arrange for Peter Lee to represent Kay Kang and her business. We met in a basement karaoke room at the Baden Baden Eestaurant in Palisades Park, owned by Ms. Kang, and discussed Kay Kang’s business, pending legal disputes, finances, and other confidential matters for several hours.
The motion judge denied the motion to disqualify, stating:
The Court has a motion to disqualify plaintiffs counsel, Peter Lee, from this action. The Court reviewing it does not find that there was any confidential information that was actually shared with counsel and no attomey/client representation or relationship existed between the movant and the attorney and, as such, the motion is denied.
In light of the certifications, I respectfully disagree with the majority that this matter, although before us on de novo review, see Trupos, supra, 201 N.J. at 463, 992 A.2d 762, can be decided on the papers.
In Dewey, supra, we expressed a preference that motions be decided on the papers where possible, but we also recognized exceptions to that rule:
Such a motion should ordinarily be decided on the affidavits and documentary evidence submitted, and an evidentiary hearing should be held only when the court cannot with confidence decide the issue on the basis of the information contained in those papers, as, for instance, when despite that information there remain gaps that must be filled before a factfinder can with a sense of assurance render a determination, or when there looms a question of witness credibility.
[109 N.J. at 222, 536 A.2d 243.]
Here, the subjects discussed during the consultation were hotly contested. Ms. Kang certified that they “discussed extensively about [her] business history and the pending legal disputes.” She alluded to her additional concern that “[i]f this suit prevails, somehow, and my company is unable to pay the judgment, other information disclosed by me during the previous consultation may *134be impinged as well, such as financial information, and managerial information.” Dr. Lee, who arranged and attended the meeting, also certified that they “discussed Kay Kang’s business, pending legal disputes, finances, and other confidential information for several hours.” In stark contrast, plaintiffs attorney Peter Lee certified that the topics discussed were limited to “problems [Ms. Kang] was then having with present defense counsel ... in connection with his handling of and representation in” the “Ko-reyo” matter and her request to have Lee substitute as her attorney in that action. Although plaintiffs attorney provided documentation supporting his contention that the “Koreyo” matter was indeed discussed during the meeting, Ms. Kang alleged that the scope of the meeting was much broader.
While acknowledging defendant’s “theoretical quandary,” which requires Ms. Kang to disclose the very confidential information she seeks to protect, the majority suggests that defendant has sought to walk a “logical tightrope” that leaves a court “with nothing of substance on which to base its decision.” Ante at 128, 19 A.3d at 978. The type of quandary in which the defendant finds itself has long existed; however, the procedure to be used in this type of case needs to be updated following our rejection of the “appearance of impropriety” analysis, which previously allowed a court to avoid inquiry into an attorney’s “actual acquisition of protected information.” See Dewey, supra, 109 N.J. at 223, 536 A.2d 243.
As explained in Trupos, supra, 201 N.J. at 464, 992 A.2d 762, the “appearance of impropriety” analysis is no longer viable, and allegations supporting a motion for disqualification “must be based in fact.” Ibid. Thus, while the movant must disclose specific facts and confidences to support the motion, the procedure should protect against unnecessarily broad disclosure to the opposing party. On the other hand, opposing counsel, who movant states is already aware of the confidences, should be involved in the proceedings subject to a protective order.
*135Thus, on remand, the trial judge should test the credibility of the witnesses and consider defendant’s allegations that plaintiffs attorney received confidential information without conveying any specific confidences to plaintiff. As the majority notes,
where a disclosure of confidential information must be made so that the court can grapple fairly with the issues, the parties may protect the confidentiality of their information by, among other means, requesting that the record be subject to a protective order, see R. 3:13-3(f) (criminal); R. 4:10-3 (civil), and the movant may further request that the application be considered in camera.
[Ante at 129, 19 A.3d at 978.]
See also ALK As.socs., Inc. v. Multimodal Applied Sys., Inc., 276 N.J.Super. 310, 316, 647 A.2d 1359 (1994) (finding, in trade secret context, that trial court may enter protective order limiting disclosure of confidential information to parties’ attorneys and experts who must agree to make no further disclosure to their clients). In terms of potential prejudice to defendant, the trial court should also consider whether counsel has specific knowledge regarding defendant’s financial ability to litigate and its attitude towards settlement. See Reardon v. Marlayne, 83 N.J. 460, 476, 416 A.2d 852 (1980) (“[N]o amount of discovery would be likely to uncover such useful information as the strengths and weaknesses of [a] corporate client’s decision-makers or their attitude towards settlement.”).
For the reasons expressed above, I respectfully dissent.
For affirmance—Chief Justice RABNER, Justices LaVECCHIA, RIVERA-SOTO and HOENS—4.
For reversal—Justices LONG and ALBIN and Judge STERN (temporarily assigned)—3.