III. PLAINTIFFS' DR 4-101(B) CLAIM:
Plaintiffs assert that trial counsel should be disqualified also because Page has violated Canon 4, which states, "A lawyer should preserve the confidences and secrets of a client". Plaintiffs' Reply Brief at 5-6. It is alleged that Page violated the canon, and Disciplinary Rule 4-101(B) promulgated under it, by representing VSI, K & S, Freeman and VEL simultaneously in late 1974 and 1975.
The merits of this factual allegation aside, plaintiffs again have failed to demonstrate the relevance of Page's ethical conduct. Plaintiffs appear to contend that counsel should be disqualified because Canon 4 has been and will be violated by Page and his firm's continued representation of K & S. For this proposition plaintiffs cite Emle Industries, Inc. v. Patentex, Inc., 478 F.2d 562 (2d Cir. 1973). There the Second Circuit affirmed a trial court's granting of a motion to disqualify plaintiff's counsel who had earlier served as counsel for a company related to defendant in a case regarding the same issues as the case at bar. The lawyer's continued service in opposition to his ex-client was deemed in that circumstance to violate his responsibilities under Canon 4, and the motion for disqualification was granted to avoid prospective violation of the canon.
We see no reason why Page's breach of Canon 4 (assuming the truth of the allegations) should lead to disqualification. Again, plaintiffs focus on alleged impropriety by Page in failing to withdraw from representing K & S, without suggesting why that conduct ought to be grounds for disqualification of Page's law firm. Emle Industries, relied on by plaintiffs, does not apply on two grounds. First, the extension to firm members explicitly granted under DR 5-102(B) is not provided for in DR 4-101(B), which merely says "a lawyer" -- i.e., Page himself and not his firm -- "shall not . . .". Second, Emle Industries concluded disqualification was appropriate on the basis of the mechanical test formulated by Judge Weinfeld in T.C. Theatre Corp. v. Warner Brothers Pictures, 113 F. Supp. 265, 268-69 (S.D.N.Y. 1953), premising disqualification on representation by the lawyer of an ex-client's adversary in a "pending suit" in which the issues are "substantially related" to those of an earlier suit in which the lawyer represented the ex-client. Since there was no suit in which Page represented VEL or Freeman, this rule is inapposite here.
IV. SCOPE OF JUDICIAL INQUIRY:
Several courts have observed that motions to disqualify require them to look into the factual contentions of a lawsuit at a preliminary stage in order to assess the merit of the claims underlying the motion and opposition. Moreover, the Third Circuit has mandated that trial courts explain their reasoning behind resolutions of such motions.
Kreda v. Rush, 550 F.2d 888, 890 (3d Cir. 1977). We cannot, consequently, accept the plaintiffs' assertion that a more limited inquiry of the kind described in Emle Industries, Inc. v. Patentex, Inc. is proper here. Plaintiffs' Reply Brief at 6-7. There, the Second Circuit noted that "the court need not, indeed cannot, inquire whether the lawyer did, in fact, receive confidential information during his previous employment which might be used to the client's disadvantage." 478 F.2d at 571 (emphasis in original). As we noted above, however, that court concluded Canon 4 was violated and affirmed an order to disqualify counsel because the mechanical rule of representation of a former client's opponent in a later lawsuit was breached; that rule is susceptible to application with limited reference to the underlying facts of the case. A motion to disqualify under DR 5-102(B) raises dissimilar issues, at least when it is made following considerable discovery and shortly before trial. In order to discern whether testimony "is or may be prejudicial", that testimony and other evidence in the case must be presented by the movant and scrutinized by the court.
The judicial consideration of the underlying facts might be extended to require that the court hold a factual hearing when a DR 5-102(B) motion to disqualify is made under circumstances such as these. We know of no case requiring us to hold such a hearing. Furthermore, both plaintiffs and defendant K & S have waived specifically and on the record any rights to a hearing which they might have had, and there is agreement among them that we can rule on the motion based upon the rather lengthy briefs and appendices thereto.
Because plaintiffs have failed to demonstrate or specify a prejudicial effect of Page's testimony upon K & S's case which is any more than speculative, their motion to disqualify counsel will be denied.