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ASI Holding Co. v. Royal Beach & Golf Resorts, LLC
Citations: 163 So. 3d 668; 2015 Fla. App. LEXIS 6357; 2015 WL 1928615Docket: No. 1D14-4928
Court: District Court of Appeal of Florida; April 29, 2015; Florida; State Appellate Court
ASI Holding Company sought a review of a trial court's order that denied its motion to disqualify counsel representing Royal Beach Golf Resorts, LLC in a dispute over a nondisclosure agreement (NDA). ASI’s former counsel, who had previously represented ASI in NDA-related matters over ten years prior, was retained by the Resort. ASI argued that this created a conflict of interest, particularly after discovering that the Resort was operating a program similar to its own, which was disclosed during their earlier negotiations under the NDA. The trial court denied ASI's disqualification motion, citing the long time elapsed since the prior representation and the specific circumstances of the NDA. In granting ASI's petition, the appellate court quashed the trial court's order and remanded for the entry of an order to grant ASI’s motion for disqualification. The review of disqualification orders is recognized as a means of protecting clients from ethical violations involving the disclosure of confidential information from prior representations. Disqualification motions are evaluated for abuse of discretion, with the appellate court refraining from substituting its judgment for the trial court's findings of fact if supported by competent substantial evidence. ASI needed to demonstrate irreparable harm and a breach of legal requirements, with the applicable Florida Rule of Professional Conduct 4-1.9 outlining the standards for disqualification based on conflicts. Under this rule, ASI had to show the existence of an attorney-client relationship and that the matters were substantially related, with the court noting that the passage of time is not a determining factor in conflicts of interest. An attorney-client relationship existed between ASI and M. J, with the presumption of disclosed confidential information. The critical issue is whether M. J’s representation of the Resort involves the same or 'substantially related' matters as prior work for ASI. While the Resort was not part of earlier disputes, the current litigation requires M. J to counter its own previous legal advice that the NDA was valid and enforceable. ASI provided evidence of M. J's past services, including demand letters asserting the NDA's validity, and M. J is now expected to argue that the NDA is not valid, creating a conflict. The case parallels Lane v. Sarfati, where disqualification was granted due to an attorney’s conflicting positions on a contract. Although Rule 4-1.9 allows for representations that do not substantially relate to prior matters, M. J's case is distinguishable as it involves directly opposing its own previous legal opinions regarding the NDA. Consequently, the court grants the petition for writ of certiorari, quashes the lower court's order, and remands for the disqualification of M. J.