Gem Holdco, LLC v. Ridgeline Energy Services, Inc.

130 A.D.3d 506, 14 N.Y.S.3d 14

• Court: Appellate Division of the Supreme Court of the State of New York
• Decided: July 9, 2015
• Docket: 15694N 650841/13
• Status: Published

Opinion

Order, Supreme Court, New York County (Shirley Werner Kornreich, J.), entered January 9, 2015, which denied defendants Changing World Technologies, L.P., Ridgeline Energy Services, Inc. and Dennis Danzik’s (the Ridgeline defendants) motion to disqualify Schlam Stone & Dolan LLP from representing defendants CWT Canada II Limited Partnership, Resource Recovery Corporation, and Jean Noelting (the CWT defendants), and denied the CWT defendants’ motion to supplement the record, unanimously affirmed as to the motion to disqualify, and the appeal therefrom otherwise dismissed, without costs, as moot.

The motion court properly denied the Ridgeline defendants’ motion to disqualify Schlam Stone & Dolan LLP from representing the CWT defendants, since in their retainer agreement with Schlam Stone & Dolan LLP, the Ridgeline defendants specifically waived any conflict of interest that might arise from the firm’s representation of both them and the CWT defendants (see St. Barnabas Hosp. v New York City Health & Hosps. Corp., 7 AD3d 83 [1st Dept 2004]). The Ridgeline defendants’ contention that they did not give informed consent to the firm’s asserting claims against them in this litigation is belied by the clear language of the retainer agreement and the unit purchase agreement. They “cannot now compel the disqualification of . . . counsel simply because the representation to which [they] consented has since devolved into litigation” (see id. at 92 [internal quotation marks omitted]).

Nor does the fact that the firm obtained confidential information from the Ridgeline defendants warrant disqualification since the Ridgeline defendants knowingly and expressly agreed in the retainer agreement to the firm’s use of their confidential information and the disclosure of that information to the CWT defendants (see id. at 90).

We have considered the Ridgeline defendants’ remaining contentions and find them unavailing. Concur — Mazzarelli, J.P., Sweeny, Saxe, Richter and Manzanet-Daniels, JJ.