Bold Limited v. Rocket Resume, Inc.

Background

Bold Limited and Bold LLC sued Rocket Resume, Inc. and Stephen Zimmerman. Bold alleged that Rocket Resume’s website copied aspects of Bold’s MyPerfectResume website, including original job descriptions in Bold’s database. The operative complaint asserted copyright infringement, unfair competition under California law, and breach of contract. After an earlier ruling, Bold LLC’s claims were compelled to arbitration, Bold Limited’s unfair-competition claim was stayed, and only Bold Limited’s copyright claim remained active.

Bold Limited had previously retained Alston & Bird for intellectual-property litigation and other legal services. Bold identified three earlier representations as potentially related: an intellectual-property transfer memorandum, intercompany intellectual-property license agreements, and two copyright enforcement actions filed in 2014. Attorneys involved in those earlier matters included current and former Alston & Bird attorneys. In the current case, Alston & Bird attorneys Chaka Patterson and Dana Zottola were connected to Rocket Resume; Patterson appeared in the case, while Zottola did not appear.

Motion and waiver issue

Bold moved to disqualify Alston & Bird under California Rules of Professional Conduct 1.9 and 1.10. Defendants argued that the earlier matters were not substantially related to the current case, that no attorney at Alston & Bird possessed relevant confidential information, that ethical screens addressed any conflict, and that Bold waived its objection through delay.

The court rejected the waiver argument. Bold first raised the potential conflict about two weeks after Patterson appeared and communicated with Defendants for several weeks before filing the motion. The court found that this delay was not extreme or unreasonable and concluded that Bold had not waived disqualification.

Substantial relationship

Under California Rule 1.9, a lawyer who formerly represented a client generally may not represent an opposing party in the same or a substantially related matter without the former client’s informed written consent. When a substantial relationship exists, the court presumes that the lawyer received confidential information; proof that the lawyer actually remembers or possesses the information is not required.

The court found that Bold had not shown that the intellectual-property transfer memorandum was substantially related to the current copyright action. The memorandum was not produced, and the parties gave different descriptions of its subject. The court also found that Bold had not sufficiently shown that the intercompany license agreement was substantially related. Bold did not adequately explain why information about corporate structure and licensing was directly at issue in, or critically important to, the copyright claim or damages.

The court reached a different conclusion about the 2014 copyright enforcement actions. Those cases involved allegations that similar resume-building websites copied the text, layout, and design of Bold’s websites, including the MyPerfectResume website. The court found that the earlier cases and the current case shared the same product, similar copyright issues, and overlapping information about Bold’s copyright registration, enforcement practices, and intellectual-property portfolio. The court therefore held that the 2014 copyright actions were substantially related to the current representation.

The court found that seven attorneys had sufficiently direct relationships with Bold in the earlier representations to permit a presumption that they received confidential information: current Alston & Bird partners Heather Ripley, Edward Tanenbaum, James Sullivan, Ryan Koppelman, and Alexander Lorenzo, and former Alston & Bird attorneys Deepro Mukerjee and Lance Soderstrom. The court did not find that Bold had provided enough evidence concerning most of the other attorneys it identified.

Imputed disqualification of the firm

California Rule 1.10 generally imputes one attorney’s conflict to the attorney’s law firm. For attorneys who remain at the firm, the firm faces a presumption that confidential information was shared, subject to the rule’s requirements concerning screening in applicable circumstances. For attorneys who have left, the firm must show that confidential information was not actually conveyed to the attorneys who remain.

Because Koppelman and Lorenzo remained Alston & Bird partners, the court held that a presumption arose that the firm’s attorneys had confidential information material to the case. The court concluded that the circumstances did not permit Alston & Bird to overcome that presumption through ethical screening. It also stated that, even if screening could overcome the presumption, the firm had not shown that its screens were effective: the screen concerning Patterson was imposed about two months after he was retained, and the record did not show that Zottola had been screened or that specific procedures prevented access to confidential information.

As to Mukerjee and Soderstrom, who had left Alston & Bird, the court found that the firm had not rebutted the presumption that confidential information was shared. The court did not doubt Patterson’s and the firm’s representations that Patterson had not discussed Bold with the firm’s attorneys, but it held that those self-serving statements alone were insufficient to establish that no confidential information had actually been conveyed.

Equitable considerations and disposition

The court considered the parties’ interests, including Defendants’ choice of counsel, the burden of replacing counsel, and whether Bold’s motion was tactical. It found that the equities favored disqualification. The court concluded that Defendants would not face substantial prejudice because Patterson served as an in-house or general counsel figure and Gibson Dunn would remain lead counsel. The court also found no tactical abuse because Bold acted promptly after learning of the potential conflict.

The court therefore GRANTED Bold Limited’s motion to disqualify Alston & Bird LLP. It DISQUALIFIED Alston & Bird from representing Rocket Resume, Inc. and Stephen Zimmerman in this action.