NEW YORK, Dec 6 (Reuters) - A federal judge on Tuesday
rejected Bank of America Corp's request to disqualify the law
firm representing insurer American International Group Inc in
its $10 billion mortgage fraud lawsuit against the bank, over
an alleged conflict of interest by one of the firm's partners.
U.S. District Court Judge Barbara Jones ruled that the
partner's minimal involvement in the case and AIG's established
relationship with Quinn Emanuel Urquhart & Sullivan weighed
against removing the law firm from the case.
Bank of America asked the judge in October to disqualify
the law firm because its partner, Marc Becker, previously
defended Merrill Lynch & Co and its First Franklin Financial
Corp unit against similar charges of mortgage fraud. Merrill
Lynch and First Franklin are now both subsidiaries of Bank of
America and defendants in the case.
Becker was a partner at Munger, Tolles & Olson, which
represents Bank of America, before he moved to Quinn Emanuel in
2008. He left Quinn Emanuel shortly after the bank filed its
motion to disqualify the firm.
Although Quinn Emanuel removed Becker from the case after
the bank's objection, Bank of America's lawyers argued that
Becker's involvement broke ethical rules by placing Becker in a
position to use his former clients' confidential information.
But the judge disagreed.
Although Becker performed 5.8 hours of work for AIG on the
case after his move, Quinn Emanuel promptly separated him from
the case within 24 hours of discovering the conflict, the judge
"Screens erected immediately upon discovery of the conflict
weigh against disqualification," Jones wrote. Becker's minimal
work on the case and his physical distance from it in firm's
London office made any disclosure of confidential client
information unlikely, she added. The size of Quinn Emanuel,
with more than 500 attorneys, reduced that risk further, she
"There is no meaningful showing that the trial process here
will be tainted," Jones ruled. Given AIG's "significant"
relationship with Quinn Emanuel and the cost of finding new
counsel, she refused to disqualify the firm.
Marc Dworsky, a lawyer for Bank of America at Munger,
Tolles & Olson, did not immediately respond to a request for
Quinn Emanuel's other cases include most of the 18 Federal
Housing Finance Agency lawsuits against Bank of America, other
banks and at least 131 individuals to recover losses on $200
billion of soured mortgage debt held by Fannie Mae and Freddie
The case is American International Group Inc v. Bank of
America Corp et al, U.S. District Court, Southern District of
New York, No. 11-06212.
For AIG: Kathleen Sullivan of Quinn Emanuel Urquhart &
For BofA: Marc Dworsky of Muger, Tolles & Olson.
(Reporting by Terry Baynes)
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