Petitioner filed a motion to quash a subpoena duces tecum that was issued to the custodian of records of petitioner's attorneys of the grounds of attorney client privilege. The Superior Court of Orange County (California), noticed the depositions of petitioner's attorneys, and denied the motion to quash, without a hearing. Petitioner filed a petition for a writ of mandate to challenge the trial court's order.
Plaintiffs filed a shareholders' derivative action against petitioner, alleging that he converted corporate assets to pay private debts, breached fiduciary duties, and diverted corporate opportunities to another company. Business litigation attorneys riverside sought to remove him and to obtain a receiver. Petitioner denied the allegations and cross-complained for damages, and for rescission of the stock transfers to plaintiffs. The appellate court found that when there was a prima facie claim of attorney-client privilege, the trial judge had to hold a full hearing, with oral argument, before ordering the revelation of client confidences to the other side, and compelling attorney testimony against a client.
A peremptory writ of mandate was issued directing respondent court to vacate its order denying petitioner's motion to quash, and hold an oral hearing before ruling on the motion.
Appellants, individual and natural gas producer companies, sought review of the decision of the Superior Court of the City and County of San Francisco (California), which disqualified a law firm from representing them in an underlying action against respondent gas corporation.
Appellants, individual and two natural gas producer companies, filed suit against respondent, gas corporation, asserting 10 causes of action. The trial court granted respondent's motion to disqualify a law firm from representing one appellant company because the law firm had previously represented respondent in a matter substantially related to the current action. The court affirmed holding that the disqualification was warranted under Cal. R. of Prof'l Conduct R. 4-101 where the law firm's former representation of respondent was substantially related to its adverse representation in the current action. The court held that the firm had gained crucial knowledge through this former representation which directly related to the issues in the current litigation. The court further held that the joint client exception did not apply in this case where the court was not concerned with the discovery of alleged privileged communications but was instead determining the propriety of an attorney's representation adverse to a former client.
Decision which disqualified a law firm from representing appellants, individual and natural gas producer companies, in an underlying action against respondent, gas corporation, was affirmed because substantial evidence supported the disqualification based on a substantial relationship between former and current representation and the joint client exception did not apply.