NOVEMBER 2006 BAD FAITH CASES
MOTION TO DISQUALIFY CARRIER’S FORMER STAFF LAWYER FROM BRINGING BAD FAITH CLAIM AS PLAINTIFF’S ATTORNEY REJECTED (Middle District)

The Court considered Defendant’s Motion to Disqualify Attorney Selingo and his law firm based on assertions that continued representation would violate various rules of professional conduct addressing conflict of interest and attorneys as witnesses. Selingo was Plaintiff’s counsel in Plaintiff’s underlying Under Insured Motorist (UIM) and bad faith claims. Selingo was also an employee of Nationwide’s Trial Division from 1996 to 2001, when he primarily represented Nationwide’s insureds in UIM claims, but never in bad faith claims.

Following his employment with Nationwide, Selingo went into private practice as a lawyer and handled several claims against Nationwide, pursuing multiple bad faith and UIM actions, none of which led to Nationwide moving for his disqualification.

Defendant argued Selingo should be disqualified based on Pennsylvania Rule of Professional Conduct 1.9, which hinges on whether the matter is “substantially related” to the matter involved in the former legal representation. Specifically if the lawyer might have acquired confidential information related to the subject matter of his subsequent representation, then Rule 1.9 would prevent the attorney from representing the second client. Because Selingo never represented Defendant as a lawyer in any bad faith claims, and because Defendant waived disqualification by not previously seeking Selinger’s disqualification as counsel in other similar cases, the Court denied Defendant’s request to disqualify based on Rule 1.9.

Defendant then argued that Selingo should be disqualified based on Local Rule 43.1 of the Local Rules of the Middle District of Pennsylvania and Rule 3.7 of the Pennsylvania Rules of Professional Conduct, which require withdrawal if an attorney becomes a witness on behalf of a client. However, the Court narrowly construed the rules to only apply to trials and found that disqualification of the lawyer would be premature at this stage in the litigation.

Finally, Defendant argued that Selingo’s law firm should be disqualified pursuant to Rule 1.10 of the Pennsylvania Rules of Professional Conduct which addresses the imputation of conflicts of interest.

The Court also rejected this argument, as Rule 1.10 relates to conflicts of interest defined in Rule 1.7 and 1.9, and because the Court concluded that Rule 1.9 does not form a basis for disqualification (and Rule 1.7 is not at issue), Rule 1.10 is not applicable. Accordingly, the Court denied Defendant’s Motion to Disqualify.

Date of Decision: November 6, 2006.

Javorski v. Nationwide Mut. Ins. Co., United States District Court for the Middle District of Pennsylvania, No. 3:06-CV-1071, 2006 U.S. Dist. LEXIS 81490 (M.D. Pa. November 6, 2006) (Conaboy, J.)