Judge Rules that Ex-Costco Lawyer isn’t Disqualified from Suing Costco

U.S. District Judge R. Gary Klausner ruled that Downtown L.A. Law Group will not be disqualified from representing their plaintiff even though one of the current attorneys working at the firm used to work for the defendant.

Anthony Werbin, a lawyer at Downtown L.A. Law Group, previously worked at Manning & Kass, Elrod, Ramirez, Trester LLP; here, he worked over 1,000 hours on Costco’s legal matters, specifically he defended Costco in personal injury cases (at least one case) and served as a trial counsel on the company’s behalf. Werbin also attended a conference designed for the company’s California defense attorneys, in which they covered/discussed litigation and defense tools and strategies for personal injury cases.

Because of this, there was a motion to disqualify the plaintiff’s counsel. Costco’s attorneys argued that during Werbin’s time as an attorney for the company, Werbin “handled virtually every aspect of Costco’s personal injury lawsuits…[including] developing strategy, communicating with Costco employees [and insurance administrators]…reviewing confidential and privileged documents, preparing responses to discovery, preparing witnesses to testify at depositions and defending numerous depositions of Costco employees, and developing litigation strategy.” Based on this, Costco’s attorneys claimed that DTLA Law Group should not be allowed to represent the plaintiff – in Rodriguez v. Costco Wholesale Corporation et al. (a slip and fall case).

In an opposition filing, DTLA Law Group pushed back against Costco. Igor Fradkin, an attorney at the firm, stated that if Costco’s argument was “accepted in this matter, it would effectively prevent any former insurance defense attorney…from working as a plaintiff’s attorney in the future. If we carry this to its absurd conclusion, it would essentially keep an insurance defense attorney from ever switching firms and remaining a defense attorney.”

Ultimately, the judge ruled that Costco failed to establish a significant relationship between the cases that Werbin represented Costco and the current personal injury case that the law firm is handling (it is important to note that the personal injury case against Costco is being handled by two attorneys at DTLA Law Group, none of which are Werbin).

Understanding the Issue

The issue here is a conflict of interest specifically related to Anthony Werbin, who once was a defense attorney for Costco and is now a plaintiff’s attorney at the firm that is suing the company. In general, when a lawyer has a conflict of interest in a case, then the entire law firm is disqualified from the case (i.e., they cannot represent the plaintiff).

Of course, there are exceptions. A law firm can be disqualified from a case unless one of the following is true:

• The conflict is personal and does not limit the representation in any way.
• The conflict arises from the lawyer’s association with a prior firm/company, so the lawyer is timely screened from the case, the lawyer does not receive any fees from said case, written notice is provided to the former client, and the lawyer had no similar participation in the same matter at the prior firm.

Based on the details surrounding the judges ruling, the law firm wasn’t disqualified due to the latter point. Specifically, the lawyer did not participate in the same personal injury case while working with Costco because the personal injury case is a completely new case in which Werbin has never been involved.