Commercial Litigation and Arbitration

Lawyer-Witness Disqualification — Standards under New York Law

From Pu v. Greenthal Mgmt. Corp., 2009 U.S. Dist. LEXIS 19554 (S.D.N.Y. Mar. 10, 2009):

The current New York Lawyer's Code of Professional Responsibility addresses circumstances meriting attorney disqualification where counsel may be required to serve as a trial witness. See DR 5-102, codified as N.Y. COMP. CODES R. & REGS. tit. 22, § 1200.21 (1999). In pertinent part, DR 5-102 places limitations on continued representation of a client in a matter where "it is obvious that the lawyer ought to be called as a witness on a significant issue" on behalf of the client, DR 5-102(c), or other than on behalf of the client, DR 5-102(d). In the latter scenario, "the lawyer may continue the representation until it is apparent that the testimony is or may be prejudicial to the client at which point the lawyer and the firm must withdraw from acting as an advocate before the tribunal." DR 5-102(d). Provisions 5-102(a) and (b) contemplate the same restrictions in the context of accepting representation in the first instance where it is known or obvious the lawyer or law firm will be called to testify on a significant issue.

As a threshold matter, courts are particularly reluctant to disqualify an attorney on the basis of the "lawyer as witness" rule, and subject such a motion to "fairly strict scrutiny." Occidental Hotels, 440 F. Supp. 2d at 315; see also Shabbir, 443 F. Supp. 2d at 307-08 (providing a comprehensive review of the "lawyer as witness" rule and recognizing that a disqualification motion so premised is "subject to 'strict scrutiny because of the 'strong potential for abuse.’’" Id. at 308 (quoting Stratavest Ltd. v. Rogers, 903 F. Supp. 663, 667 (S.D.N.Y. 1995) (quoting Russo v. Friedman, No. 90 Civ. 6913 (LBS), 1992 WL 196791, at *9 (S.D.N.Y. July 31, 1992)))). As part of the inquiry, the Court must determine the necessity of the attorney as a witness. Talvy v. American Red Cross in Greater New York, 618 N.Y.S.2d 25, 30-31 (N.Y. App. Div. 1994); Paretti, 722 F. Supp. at 986; see also Pearl v. 305 East 92nd Street Corp., 548 N.Y.S.2d 25 (N.Y. App. Div. 1989).

Determining whether an attorney's testimony is necessary "must take into account such factors as the significance of the matters, weight of the testimony, and availability of other evidence." Talvy, 618 N.Y.S.2d at 30-31; Paretti, 722 F. Supp. at 986 (quoting S & S Hotel Ventures Ltd. Partnership v. 777 S.H. Corp. , 69 N.Y.2d 437, 446 (1987)). Where it is unclear whether an attorney's testimony will be necessary, a motion to disqualify should be dismissed, unless there is a showing of clear prejudice to the moving party. Shabbir, 443 F. Supp. 2d at 308 (referencing Stratavest Ltd. , 903 F. Supp. at 668). The more speculative the potential prejudice, the less likely a court will be to grant a motion to disqualify. Id. Further, where a lawyer would provide only cumulative testimony, he may act as trial counsel. See Paretti, 722 F. Supp. at 986 (referencing Munk v. Goldome Nat'l Corp., 697 F. Supp. 784, 787, n.3 (S.D.N.Y. 1988)). Once it is clear that counsel will be called as a witness on an issue, the party moving to disqualify said counsel carries the burden of demonstrating how, and as to what issues in the case, the prejudice may occur and that the likelihood of prejudice occurring is substantial. See Occidental Hotels, 440 F. Supp. 2d at 315. Finally, "'[t]he Southern District has held that vicarious disqualification of an entire firm is not necessary when an individual attorney is disqualified under DR 5-102[a]'" or (b). Id. (quoting April Broadcasting, Inc. v. Smith, No. 95 Civ. 7664 (LMM), 1996 WL 137487, at *5 (S.D.N.Y. Mar. 27, 1996)).

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