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Texas Supreme Court Weekly Update December 22, 2017

On Behalf of | Dec 22, 2017 | Texas Supreme Court Weekly Update

This week, the Texas Supreme Court issued four opinions. Significantly, in one opinion, the Court provides guidance on the circumstances under which a law firm must be disqualified for employing a paralegal who previously worked for the opposing counsel.

Under the specific facts of In re Bertram Turner and Regulatory Licensing & Compliance L.L.C., the Court determined that disqualification was warranted. In the underlying case, the Vethan Law Firm represented Bertram Turner and Regulatory Licensing & Compliance (RLC) against Christina Lopez and the Cweren Law Firm represented Lopez. After opening the Turner case, the Vethan Law Firm hired Jeneal Wright as a paralegal and assigned her to the case. Wright worked at the Vethal Law Firm for only six weeks. Eight months after leaving the Vethan Law Firm, Wright was hired by the Cweren Law Firm as a paralegal. Although the Cweren Law Firm asked interview questions based on Wright’s resume, the Cweren Law Firm took no other actions to screen for potential conflicts. In neither her resume nor her interview did Wright disclose her previous employment at the Vethan Law Firm. As part of her employment at Cweren Law Firm, Wright worked on the Turner case, through mainly in a clerical role. When the Vethan Law Firm became aware of Wright’s involvement in the case, the firm filed a motion to disqualify the Cweren Law Firm alleging a conflict of interest based on Wright’s involvement in the case.

The trial denied this motion and the court of appeals denied the subsequent motion for writ of mandamus.

On appeal, the Texas Supreme Court reaffirmed that in order to disqualify a firm whose non-lawyer previously worked for the opposing counsel the following elements must be shown: (1) the non-lawyer obtained confidential information about the matter while working for the opposing counsel; and (2) the non-lawyer shared the information with her current firm. The Court further explained that under the first element there is a presumption that the non-lawyer obtained confidential information about the matter if she actually worked on the matter for her former firm. In this case, there was evidence that Wright actually worked on the Turner case while employed by each firm; therefore, this presumption was raised.

Additionally, the Court explained that under the second element there is a rebuttable presumption that the non-lawyer obtained information and shared it with her current firm. This is sometimes referred to as the “shared-confidences presumption,” and it can be overcome with evidence that: (1) the non-lawyer was instructed not to work on any matter on which she worked during her prior employment or (2) the firm took “other reasonable steps to ensure that the [non-lawyer] does not work in connection with matters on which the [non-lawyer] worked during the prior employment, absent client consent.”1

Ultimately, in this case, the Court found that the Cweren Law Firm failed to rebut the shared-confidences presumption, because it did not instruct Wright to refrain from working on any cases on which she had worked during her prior employment until after learning of the conflict in the Turner case. Significantly, the Court concluded that it did not matter whether the Cweren Law Firm knew of the conflict – the threat of prohibited disclosure was too high.

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