13
Jul
By Eric Schweibenz
On July 9, 2010, ALJ Carl C. Charneski issued the public version of Order No. 10 disqualifying Adduci, Mastriani & Schaumberg, LLP (“AMS”) as counsel for Complainants Apple Inc. and NeXT Software, Inc. (“Apple”) in Certain Personal Data and Mobile Communications Devices and Related Software (Inv. No. 337-TA-710).  Respondents Nokia Corporation and Nokia, Inc. (“Nokia”) filed the motion based on AMS’s representation of Nokia in a previous ITC action.  Apple and the Commission Investigative Staff (“OUII”) opposed.

AMS, along with two other law firms, filed the complaint in the instant investigation (the “710 Investigation”) on behalf of Apple.  Nokia was not named as a Respondent in the 710 Investigation.  Nokia was, however, a Respondent in an earlier Investigation involving Apple (Inv. No. 337-TA-704 – the “704 Investigation”).  AMS voluntarily withdrew as counsel in the 704 Investigation based on its previous representation of  Nokia in the Qualcomm investigation (Inv. No. 337-TA-578).  While that withdrawal ended any possible conflict of interest in the 704 investigation, when investigations 704 and 710 were partially consolidated, Nokia became a respondent and the conflict issue arose again.

Nokia argued that disqualification was warranted because the Qualcomm and the 710 investigation were substantially related as they both involve the same basic technology – the software and hardware in Nokia phones.  Nokia also argued that AMS acquired confidential proprietary business information during its representation of Nokia.

AMS argued that the matters are not substantially related because the patents at issue in each investigation are different.  They further argued that they had not been involved in the technical issues of the Qualcomm investigation and, in any event, had erected an ethical wall between attorneys for the Qualcomm and 710 investigations.

OUII, while agreeing with Nokia that the investigations were substantially related, argued that the ethical wall was adequate to protect Nokia’s interests.

ALJ Charneski found that the investigations are substantially related.  He also held that AMS did not address the “critical issue” that AMS acquired Nokia’s confidential proprietary business information during the Qualcomm investigation.  According to the Order, AMS’s failure to rebut Nokia’s assertions proved fatal to AMS’s arguments.

ALJ Charneski further held that the ethical wall was not sufficient to satisfy ABA Model Rule 1.9(a) which states that “[a] lawyer who has formerly represented a client in a matter shall not thereafter represent another person in the same or a substantially related matter in which that person's interests are materially adverse to the interests of the former client unless the former client gives formal consent, confirmed in writing.”