IN RE: TOWN OF OYSTER BAY

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Supreme Court, Appellate Division, Second Department, New York.

IN RE: TOWN OF OYSTER BAY, respondent, v. 55 MOTOR AVENUE CO., LLC, et al., appellants. (and another title).

Decided: August 14, 2013

REINALDO E. RIVERA, J.P., MARK C. DILLON, THOMAS A. DICKERSON, and LEONARD B. AUSTIN, JJ. Hamburger, Maxson, Yaffe, Knauer & McNally, LLP, Melville, N.Y. (Richard Hamburger and Andrew K. Martingale of counsel), for appellants. Berkman, Henoch, Peterson, Peddy & Fenchel, P.C., Garden City, N.Y. (Joseph E. Macy and Steven Brock of counsel), for respondent.

In two related condemnation proceedings, 55 Motor Avenue Co., LLC, Cubbies Properties, Inc., Jefry Rosmarin, and J. Jay Tanenbaum appeal from an order of the Supreme Court, Nassau County (Adams, J.), dated August 23, 2012, which denied their motion to disqualify Saul R. Fenchel and Berkman, Henoch, Peterson, Peddy & Fenchel, P.C., from the continued representation of the Town of Oyster Bay.

ORDERED that the order is reversed, on the facts and in the exercise of discretion, with costs, and the motion of 55 Motor Avenue Co., LLC, Cubbies Properties, Inc., Jefry Rosmarin, and J. Jay Tanenbaum to disqualify Saul R. Fenchel and Berkman, Henoch, Peterson, Peddy & Fenchel, P.C., from the continued representation of the Town of Oyster Bay is granted.

“The disqualification of an attorney is a matter that rests within the sound discretion of the court” (Columbus Constr. Co., Inc. v. Petrillo Bldrs. Supply Corp., 20 A.D.3d 383, 383, 799 N.Y.S.2d 97; see Albert Jacobs, LLP v. Parker, 94 AD3d 919, 919). A party seeking disqualification of its adversary's counsel based on counsel's purported prior representation of that party must establish: “(1) the existence of a prior attorney-client relationship between the moving party and opposing counsel, (2) that the matters involved in both representations are substantially related, and (3) that the interests of the present client and former client are materially adverse” (Tekni–Plex, Inc. v. Meyner & Landis, 89 N.Y.2d 123, 131, 651 N.Y.S.2d 954, 674 N.E.2d 663; see Gabel v. Gabel, 101 A.D.3d 676, 676, 955 N.Y.S.2d 171; Calandriello v. Calandriello, 32 A.D.3d 450, 451, 819 N.Y.S.2d 569; Columbus Constr. Co., Inc. v. Petrillo Bldrs. Supply Corp., 20 AD3d at 383). “A party's entitlement to be represented in ongoing litigation by counsel of [its] own choosing is a valued right which should not be abridged absent a clear showing that disqualification is warranted” (Matter of Dream Weaver, Realty, Inc. [Poritzky–DeName ], 70 A.D.3d 941, 943, 895 N.Y.S.2d 476; see Gabel v. Gabel, 101 A.D.3d at 677, 955 N.Y.S.2d 171).

Here, the appellants established that the attorney for the Town of Oyster Bay is Berkman, Henoch, Peterson, Peddy & Fenchel, P.C. (hereinafter Berkman Henoch). The appellants further established that Saul Fenchel, who became a member of Berkman Henoch in 2010, had a prior attorney-client relationship with the appellants, that the matters involved in Fenchel's representation of the appellants were substantially related to the matters involved in Fenchel's representation of the Town, and that the interests of the appellants and the Town were materially adverse. Further, regardless of whether Fenchel actually obtained and disseminated confidential information in connection with his former representation of the appellants, they are “entitled to freedom from apprehension and to certainty that [their] interests will not be prejudiced” due to Fenchel's representation of the Town in the related condemnation proceedings (Cardinale v. Golinello, 43 N.Y.2d 288, 296, 401 N.Y.S.2d 191, 372 N.E.2d 26; see Columbus Constr. Co. v. Petrillo Builders Supply Corp., 20 A.D.3d 383, 384, 799 N.Y.S.2d 97; Nationwide Assoc. v. Targee Street Internal Med. Group, P.C., 303 A.D.2d 728, 729, 758 N.Y.S.2d 108). Accordingly, the Supreme Court improvidently exercised its discretion in denying that branch of the appellants' motion which was to disqualify Fenchel from representing the Town in these proceedings (see Albert Jacobs, LLP v. Parker, 94 AD3d 919; M.A.C. Duff, Inc. v. ASMAC, LLC, 61 A.D.3d 828, 828–830, 878 N.Y.S.2d 748; Columbus Constr. Co. v. Petrillo Builders Supply Corp., 20 A.D.3d 383, 384, 799 N.Y.S.2d 97; Moccia v. Weisfogel, 253 A.D.2d 800, 801, 677 N.Y.S.2d 503).

In addition, the Supreme Court improvidently exercised its discretion in denying that branch of the appellants' motion which sought to disqualify Berkman Henoch from representing the Town in these proceedings. There is a rebuttable presumption that “where an attorney working in a law firm is disqualified from undertaking a subsequent representation opposing a former client, all the attorneys in that firm are likewise precluded from such representation” (Kassis v. Teacher's Ins. & Annuity Assn., 93 N.Y.2d 611, 616, 695 N.Y.S.2d 515, 717 N.E.2d 674). That presumption may be rebutted by proof that “any information acquired by the disqualified lawyer is unlikely to be significant or material in the [subject] litigation” (Kassis v. Teacher's Ins. & Annuity Assn., 93 N.Y.2d at 617, 695 N.Y.S.2d 515, 717 N.E.2d 674). Proof must also be presented that the law firm properly screened the disqualified lawyer from dissemination and receipt of information subject to the attorney-client privilege (id.). Here, the Town failed to present any evidence that Fenchel did not acquire information that was significant or material in the subject litigation or that Berkman Henoch took steps to screen Fenchel to protect the dissemination of any such information by him to the other attorneys at the firm. Consequently, Berkman Henoch must also be disqualified from representing the Town in these proceedings (see Kassis v. Teacher's Ins. & Annuity Assn., 93 N.Y.2d at 618–619, 695 N.Y.S.2d 515, 717 N.E.2d 674; Matter of Haberman v. Zoning Bd. of Appeals of City of Long Beach, 85 A.D.3d 915, 916, 925 N.Y.S.2d 834).

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