Court Opinion

ID: 2785262
Source: CourtListenerOpinion
Date Created: 2015-03-11 15:00:47.028487+00
Date Added: 2024-06-11T11:03:20.650974
License: Public Domain

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,
 4       on the 11th day of March, two thousand fifteen.
 5
 6       PRESENT: DENNIS JACOBS,
 7                RAYMOND J. LOHIER, JR.,
 8                              Circuit Judges,
 9                PAMELA K. CHEN,
10                              District Judge.*
11
12       - - - - - - - - - - - - - - - - - - - -X
13       BOIES, SCHILLER & FLEXNER LLP,
14                              Appellant,
15
16                    -v.-                                               14-2949
17
18       HOST HOTELS & RESORTS, INC.,
19                              Appellee.**
20       - - - - - - - - - - - - - - - - - - - -X
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

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 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

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