Perplexity Solved Solutions, Inc. v. Perplexity AI, Inc.

Background

Mitchell Silberg & Knupp LLP and its attorneys Eleanor M. Lackman and Marissa B. Lewis asked to withdraw as attorneys of record for Plaintiff and Counterclaim Defendant Perplexity Solved Solutions, Inc. Ms. Lewis stated that there had been an irreparable breakdown in the attorney-client relationship and that the firm could not continue to represent the company effectively. She did not provide exhaustive details because of professional and ethical obligations, but stated that professional considerations required ending the representation.

Ms. Lewis stated that she notified Perplexity Solved Solutions of the intent to withdraw on June 20, 2025. The company responded on June 30 that it was in the process of substituting counsel. Ms. Lewis attempted to follow up on July 1, 2, 3, and 9, but had received no further response as of July 18. Perplexity AI did not oppose withdrawal and requested conditions requiring a deadline for substitute counsel. At the time, the initial case-management conference was set for August 27, 2025, and no other deadlines had been set.

Court’s Analysis

The court explained that withdrawal of a party’s sole remaining counsel requires a court order under the Northern District of California’s local rules. The court also stated that attorney withdrawal is governed by the professional-conduct standards applicable to members of the State Bar of California and is committed to the trial court’s discretion.

The court concluded that Ms. Lewis’s statement about the breakdown in the attorney-client relationship satisfied the requirement for a valid reason to withdraw. The court determined that an in-camera review was not necessary. It also concluded that practical considerations did not weigh against withdrawal.

Ruling

Judge Jacquelyn Scott Corley GRANTED Counsel’s motion to withdraw as counsel of record for Perplexity Solved Solutions, Inc. The withdrawal was conditioned on the firm continuing to accept service of documents for forwarding until the company obtains alternate counsel.

The court granted Perplexity Solved Solutions an additional 30 days to acquire new counsel, requiring any new counsel to appear by September 5, 2025. The court continued the case-management conference to September 17, 2025, at 2:00 p.m. by Zoom, with a joint case-management statement due one week earlier.

The court advised that because Perplexity Solved Solutions is a company, it must appear in federal court through licensed counsel. The court stated that failure to retain substitute counsel may result in a default judgment on Perplexity AI’s counterclaims and dismissal of Perplexity Solved Solutions’ action against Perplexity AI. The order disposed of Docket No. 50.