In a July 22 opinion, Judge Payne disqualified Steptoe & Johnson as counsel for Sunbeam Products because a Steptoe associate had performed work involving one of the defendants’ accused products while employed at a prior firm. Sunbeam Products v. Hamilton Beach Brands, Inc., et al., Case No. 3:09CV791, 2010 U.S. Dist. LEXIS 74001 (E.D. Va. July 22, 2010). The opinion can be found here.
While at his prior firm, the associate had done extensive patent-related work with the accused products, including working on patent litigation involving the products, preparing utility and design patents, preparing a patentability opinion relating to the accused products and analyzing the prior art, some of which was being asserted by the defendant in the Sunbeam case. Steptoe had identified the potential conflict during its conflict check but determined that the Sunbeam litigation was not “substantially related” to the associate’s prior work because the associate had not done any work relating to the patents Sunbeam was asserting, and Sunbeam did not challenge the defendant’s patents on which the associate had worked.
The opinion is a straightforward application of Rule 1.9(a) of Virginia’s Rules of Professional Conduct, which bars a lawyer who has formerly represented a client in a matter from representing another client in the same or a substantially related matter, and Rule 1.10(a), which imputes a conflict involving one attorney to all other attorneys in the firm.
More importantly for practicioners in the EDVA, the opinion highlights the high level of scrutiny of potential conflicts in the Fourth Circuit. Judge Payne cited a long line of Fourth Circuit and Eastern District of Virginia authority holding that “ethical rules are not to be applied ‘with hair-splitting nicety,’” and that all doubts should be resolved in favor of disqualification. Judge Payne rejected Steptoe’s reliance on a number of cases from other circuits which “have parsed the issues in the prior and current representations finely so as to distinguish the two representations and declare them not to be substantially related.” Such authorities, Judge Payne held firmly, “neither control nor persuade the Court to engage in the sort of ‘hair-splitting’ which the Fourth Circuit expressly has said cannot be done.”
As reported by 