Boies, Schiller & Flexner LLP v. Host Hotels & Resorts, Inc. , 603 F. App'x 19 ( 2015 )

14-2949
Boies, Schiller & Flexner LLP v. Host Hotels & Resorts, Inc.
UNITED STATES COURT OF APPEALS
FOR THE SECOND CIRCUIT
SUMMARY ORDER
RULINGS BY SUMMARY ORDER DO NOT HAVE PRECEDENTIAL EFFECT. CITATION TO A SUMMARY ORDER FILED
ON OR AFTER JANUARY 1, 2007, IS PERMITTED AND IS GOVERNED BY FEDERAL RULE OF APPELLATE
PROCEDURE 32.1 AND THIS COURT’S LOCAL RULE 32.1.1. WHEN CITING A SUMMARY ORDER IN A
DOCUMENT FILED WITH THIS COURT, A PARTY MUST CITE EITHER THE FEDERAL APPENDIX OR AN
ELECTRONIC DATABASE (WITH THE NOTATION “SUMMARY ORDER”). A PARTY CITING A SUMMARY ORDER MUST
SERVE A COPY OF IT ON ANY PARTY NOT REPRESENTED BY COUNSEL.
1 At a stated term of the United States Court of Appeals
2 for the Second Circuit, held at the Thurgood Marshall United
3 States Courthouse, 40 Foley Square, in the City of New York,
4 on the 11th day of March, two thousand fifteen.
5
6 PRESENT: DENNIS JACOBS,
7 RAYMOND J. LOHIER, JR.,
8 Circuit Judges,
9 PAMELA K. CHEN,
10 District Judge.*
11
12 - - - - - - - - - - - - - - - - - - - -X
13 BOIES, SCHILLER & FLEXNER LLP,
14 Appellant,
15
16 -v.- 14-2949
17
18 HOST HOTELS & RESORTS, INC.,
19 Appellee.**
20 - - - - - - - - - - - - - - - - - - - -X
21
*
The Honorable Pamela K. Chen, United States District
Judge for the Eastern District of New York, sitting by
designation.
**
The Clerk of Court is respectfully directed to amend
the official caption as set forth above.
1 FOR APPELLANT: DAVID A. BARRETT (with Donald L.
2 Flexner, Boies, Schiller &
3 Flexner LLP, Michael S. Ross,
4 Law Offices of Michael S. Ross,
5 on the brief), Boies, Schiller &
6 Flexner LLP, New York, New York.
7
8 FOR APPELLEE: KEVIN J. PERRA (with Richard M.
9 Goldstein, Jordan B. Leader, and
10 Boris Zeldin, on the brief),
11 Proskauer Rose LLP, New York,
12 New York.
13
14 Appeal from a judgment of the United States District
15 Court for the Southern District of New York (McMahon, J.).
16
17 UPON DUE CONSIDERATION, IT IS HEREBY ORDERED, ADJUDGED
18 AND DECREED that the judgment of the district court be
19 AFFIRMED.
20
21 Boies, Schiller & Flexner LLP (“BSF”) appeals from the
22 judgment of the United States District Court for the
23 Southern District of New York (McMahon, J.), imposing
24 sanctions against it upon the motion of its former client,
25 Host Hotels & Resorts, Inc. (“Host”). We assume the
26 parties’ familiarity with the underlying facts, the
27 procedural history, and the issues presented for review.
28
29 Host moved for sanctions on the grounds that BSF’s
30 representation of Madison 92nd Street Associates, LLC
31 (“Madison”) presented a clear conflict of interest in light
32 of BSF’s earlier, substantially related representation of
33 Host, and that BSF unreasonably refused to withdraw from its
34 representation of Host until faced with a motion to
35 disqualify. The district court agreed, concluding that “[a]
36 clearer conflict of interest cannot be imagined” and that
37 Host was entitled to fees and costs incurred in preparing
38 the motion to disqualify BSF.
39
40 Based on Host’s assertion of attorney-client privilege,
41 the specifics of the advice implicated by this appeal were
42 placed under seal in the district court and remain so here.
43 If it is arguable that Host waived its privilege by bringing
44 its motion for sanctions, BSF has not pressed that argument.
45 Upon review for abuse of discretion, Star Mark Mgmt., Inc.
46 v. Koon Chun Hing Kee Soy & Sauce Factory, Ltd., 682 F.3d
47 170, 175 (2d Cir. 2012) (per curiam)--and without endorsing
2
1 all of the tonalities of the district court’s opinion--we
2 affirm for substantially the reasons stated therein.
3
4 The district court’s findings and review of the record
5 support its conclusion that BSF acted “without a colorable
6 basis” for maintaining it had no conflict of interest until
7 it was faced with the motion to disqualify. Enmon v.
8 Prospect Capital Corp., 675 F.3d 138, 143 (2d Cir. 2011).
9 The court’s finding that BSF provided to its outside ethics
10 counsel an unreasonably narrow description of its work for
11 Host is itself sufficiently indicative of bad faith. And
12 the court made other factual findings, including that: BSF
13 accepted the Madison engagement without reviewing its
14 billing records or files pertaining to its prior
15 representation of Host; represented to Host and its outside
16 counsel that it had no conflict before completing its review
17 of its files; filed the Madison complaint before completing
18 its internal document review and production of documents to
19 Host; and, willfully refused to recognize the obvious
20 conflict. See Gollomp v. Spitzer, 568 F.3d 355, 368-74 (2d
21 Cir. 2009) (concluding district court’s findings and review
22 of the record supported its conclusion that plaintiff’s
23 conduct was “akin to bad faith”).
24
25 In sum, contrary to BSF’s argument, the court concluded
26 BSF’s conduct was “far, far worse” than mere negligence.
27 See DLC Mgmt. Corp. v. Town of Hyde Park, 163 F.3d 124, 136
28 (2d Cir. 1998) (“[T]hese findings [are] sufficiently concise
29 and based on clear evidence so as to amount to the bad faith
30 required to impose sanctions.”).
31
32 For the foregoing reasons, and finding no merit in
33 BSF’s other arguments, we hereby AFFIRM the judgment of the
34 district court.
35
36 FOR THE COURT:
37 CATHERINE O’HAGAN WOLFE, CLERK
38
3