Men Women N.Y. Model Mgmt., Inc. v. Kavoussi
| Decision Date | 29 September 2014 |
| Docket Number | INDEX NO. 154076/2014 |
| Citation | 2014 NY Slip Op 32515 (U) |
| Parties | MEN WOMEN N.Y. MODEL MANAGEMENT, INC. Plaintiff, v. ALI KAVOUSSI, Defendant. |
| Court | New York Supreme Court |
Upon a reading of the foregoing cited papers, it is ordered that defendant's motion seeking to disqualify plaintiff's attorneys, specifically, Brian S. Kaplan and the law firm of Kasowitz, Benson, Torres & Friedman, LLP, is denied. Plaintiff's cross-motion for sanctions pursuant to 22 NYCRR 130-1.1[c], is denied.
Defendant was employed by an agency called 1 Model Management, LLC (hereinafter referred to as "One Model") from 2004 through May 8, 2008, when he tendered his resignation letter and began working for the plaintiff. On June 11, 2008, One Model commenced an action in Supreme Court New York County, under index number 108191/2008, solely against the defendant for breach of his employment agreement, derived from the solicitation of models and the use of confidential and proprietary information. On June 12, 2008, defendant and plaintiff entered into a joint retainer agreement for legal representation by the law firm of Kasowitz, Benson, Torres & Friedman, LLP, signed by Brian S. Kaplan (hereinafter referred to collectively as "plaintiff's attorneys"), in the One Model litigation (Cross-Mot., Leccese Aff., Exh E). Defendant was represented by Kasowitz, Benson, Torres & Friedman, LLP, in the One Model litigation through November 16, 2011, when the parties entered into a stipulation of discontinuance (Cross-Mot., Kaplan A ff., Exh. I).
Defendant entered into an employment agreement with plaintiff as a "model manager" also known as a "booker," for a set term to expire on September 30, 2014. In November of 2013, defendant sought permission from plaintiff to terminate the employment agreement prior to the expiration date. Defendant also sought permission to continue to represent five specific models that were under contract with plaintiff. On November 25, 2013 plaintiff and defendant entered into a separation agreement terminating his employment, effective through December 6, 2014. The separation agreement included provisions for the non-disparagement of plaintiff and non-solicitation of plaintiff's managers and models, except for the five specific models named bydefendant. On April 28, 2014, plaintiff commenced this action for breach of the separation agreement alleging that the defendant violated its non-solicitation and non-disparagement provisions, and for injunctive relief .
Defendant seeks an Order disqualifying plaintiff's attorneys, for conflict of interest derived from the services they rendered to him in the One Model litigation. Defendant contends that he had an ongoing relationship with plaintiff's attorneys in the One Model litigation which is substantially related to material issues in this action. Defendant also contends that he disclosed confidential information on his relationships with clients and business strategies to Mr. Kaplan, that would be used to his detriment in this action.
Plaintiff opposes the motion contending that there is no substantial relationship between the two actions. Plaintiff asserts that it was not named as a party to the litigation with One Model which took place over six years ago. Plaintiff also contends that two separate and distinctly different contracts are involved, this action involves a separation agreement, not an employment contract. Plaintiff argues that defendant has not specifically stated his claim of violation of confidential disclosure. It is also argued that as an employee of the plaintiff during the joint representation, defendant could not reasonably believe that his communications would be privileged as to plaintiff.
The disqualification of counsel rests within the sound discretion of the trial court (Ferrolito v. Vultaggio, 99 A.D.3d 19, 949 N.Y.S. 2d 356 [N.Y.A.D. 1st Dept., 2012]). A party seeking disqualification has the burden of proof on the motion (S&S Hotel Ventures, Ltd. Partnership v. 777 S.H. Corp., 69 N.Y. 2d 437, 508 N.E. 2d 647, 515 N.Y.S. 2d 735 [1987]). A determination of disqualification requires the balancing of general policy favoring a party's choice of representation by an attorney and potential related hardships, against any potential impropriety (Techni-Plex, Inc. v. Meyner and Landis, 89 N.Y. 2d 123, 6745 N.E. 2d 663, 651 N.Y.S. 2d 954 [1996]). A party seeking to disqualify his adversary's attorney, must establish, "(1) the existence of a prior attorney-client relationship between movant and opposing counsel; (2) that the matters involved in the prior and present representations are 'substantially related;' and (3) that the interests of the present client and former client are materially adverse." All three elements must be met (Reem Contracting Corp. v. Resnick Murray St. Associates, 43 A.D. 3d 369, 843 N.Y.S. 2d 3 [N.Y.A.D. 1st Dept., 2007] and Campbell v. McKeon, 75 A.D. d 479, 905 N.Y.S. 2d 589 [N.Y.A.D. 1st Dept., 2010]). To establish a "substantial relationship," it must be demonstrated that the issues in the present litigation are,"'identical to' or 'essentially the same' as those in the prior case (Lightning Park, Inc. v. Wise, Lerman & Katz, P.C., 197 A.D. 2d 52, 609 A.D. 2d 904 [1st Dept., 1994]).
There was clearly a prior attorney client relationship between plaintiff's attorneys and the defendant, and the interests of the parties are currently adverse, but defendant has failed to establish that the actions are "substantially related." The One Model action involved a prior employment contract and although jointly represented, plaintiff was not a party to that action. The claims brought are in the context of different types of agreements.
If a party fails to establish a "substantial relationship" between the actions, disqualification can still occur based on a showing that specific confidential disclosure existed during the course of representation that may be used to its detriment in the present action (Lightning Park, Inc. v. Wise, Lerman & Katz, P.C., 197 A.D. 2d 52,supra and Jamaica Public Service Co. Ltd. v. AIU Insurance Company, 92 N.Y. 2d 631, 707 N.E. 2d 414, 684 N.Y.S. 2d 459 [1998]). A party is entitled to be free from the apprehension that prior representation will prejudice its interests (Cardinale v. Golinello, 43 N.Y. 2d 288, 372 N.E. 2d 26, 401 N.Y.S. 2d 191 [1977]). An employee does not have a reasonable expectation of confidentiality in dealings with, or joint representation by, a corporate employer's attorneys (Meyers v. Lipman, 284 A.D. 2d 207, 726 N.Y.S. 2d 547 [1st Dept., 2001]). An express written agreement to waive conflict of interest will be enforced against the party that signed it (St. Barnabus Hospital v. New York City Health and Hospitals Corporation, 7 A.D. 3d 83, 775 N.Y.S. 2d 9 [1st Dept., 2004].
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