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MINTZ LEVIN
Bridget M. Rohde I 2126926883 I bmrohde@mintz.com
MEMO ENDORSED
BY HAND
S.ef1
Hon. Richard M. Bennan
United States District Court
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USDC SDNY 212-983-3115 fax
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\ DATE rlLED:
Southern District of New York
United States Courthouse
500 Pearl Street
New York, NY 10007
Re: 90 Civ. 5722 (SDNY) (RMB)
Conflict of Interest Question
CHAMBERS OF ­
RICHARD M. BERMAN
U.S.D.J.
Dear Judge Bennan:
We write in response to the Court's request for the parties and the Review Officer to
address whether any conflicts arise from the dual representation by Kauff McGuire & Margolis
LLP ("KMM") of the Taft-Hartley fringe benefit funds of the New York City District Council of
Carpenters ("Benefit Funds") and the Contractors Association of Greater New York
("CAGNY").
We respectfully submit that we do not believe that there were any actual conflicts
presented due to KMM's prior simultaneous representation of both the Benefit Funds and
CAGNY. Our belief is based both on our independent analysis of the facts available to us as
well as on Mr. McGuire's representations in his letter of August 22. See Letter by Raymond G.
McGuire dated August 22, 2013 at 2. (Of course, we do not have all of the facts that KMM has
and, for exanlple, we cannot independently know whether confidential infonnation from the
Benefit Funds could have been used in the negotiations), Additionally, now that KMM has
ceased representing CAGNY in any matter, the possibility of a conflict has further dissipated.
As to any remaining possibility of potential conflict due to CAGNY being a fonner client of
KMM, Mr. McGuire has represented that he will decline to provide advice to the Benefit Funds
on any matter involving CAGNY, See id. 11
As background, since late 2010, KMM has represented the Benefit Funds as its general
outside counsel. KMM has also represented CAGNY, including in its negotiation for a new
collective bargaining agreement with the District Council. The Benefit Funds are not a party to
We further note that KMM polled each of the Funds' trustees and received a waiver of any actual or potential
conflict arising from the dual representation. See id. at l. Rule l.7(b) of the New York Rules of Professional
Conduct provides that if there is no impediment to the clients providing informed consent, see Rule 1.7(b)(1-3), and
both affected clients provide informed consent and that consent is confirmed in writing, see Rule 1.7(b)(4), a lawyer
may represent a client notwithstanding a concurrent conflict of interest.
Mintz, Levin, Cohn, Ferris, Glovsky and Popeo, P.C.
BOSTON I LOl'4DON I Los AN(;EU:S I NEW YORK I SAN DJEl;O I SAN FRANCISCO I STAMl'ORD I WASHINGTON
II
August 26,2013
Page 2
any of the District Council's CBAs including the one with CAGNY and counsel for the Benefit
Funds do not participate in the CBA negotiations.
One aspect of the collective bargaining agreement negotiated by the parties is the
compensation package for union members. This package contains both wages and benefits. The
benetit contributions are made to the Benefit Funds on behalf of the union members rather than
to the members directly, such that the Funds might be considered a third party beneficiary. That,
however, is not direct adversity. A related issue is that it is possible that confidential information
in an attorney's possession from representing the Benefit Funds could be utilized in negotiating
on behalf of the contractors' association or vice versa. Of course, that is a very fact specific
inquiry. There is no per se adversity because of the mere existence of this possibility.
With respect to the compensation package for the union members, it is important to note
that the contributions are made by individual contractors to each of the benefit funds - pension,
welfare et cetera. One problem that can arise during the period of a CBA is that an individual
contractor may fail to pay, or fall behind in paying, contributions. When that occurs, collection
counsel for the Funds, here, Virginia & Ambinder and not KMM, pursues the money that is in
arrears. We additionally note that these actions are against the individual contractors, not the
relevant contractors' association.
Under Rule 1.7 of the New York Rules of Professional Conduct, it does not appear that
any actual conflict of interest has been presented by KMM's representation of the Benefit Funds
and CAGNY. We have no reason to believe that KMM has represented differing interests of the
Benefit Funds and CAGNY, as precluded by Rule 1.7(a)(1).21 It is our understanding that the
Benefit Funds and CAGNY have not been directly adverse. If adversity were to arise, it would
most likely be between the Funds and an individual contractor who fails to make any or some
portion of his benefit contributions. KMM would not handle such a representation for the Funds,
Virginia & Ambinder would. It is reasonable for KMM and its lawyers to conclude that their
judgment would not be impaired and their loyalty to the Benefits Funds and CAGNY would not
be divided by the continued representation of both of these clients as long as no single matter
involved both the Benefit Funds and CAGNY.
Additionally, as indicated in Mr. McGuire's letter of August 22, despite the absence of
any conflict and despite obtaining a waiver from the Funds' trustees, KMM has ceased
representing CAGNY in all matters. New counsel, Dennis Lalli, Esq., of Bond Schoeneck &
We note that All Star Carts & Vehicles, Inc. v. BFI Can. Income Fund, 2010 U.S. Dist. LEXIS 53290 at *11- 17
(June 1, 2010, E.D.N.Y.), provides a discussion of conflicts of interest law in the disqualification context in the
Second Circuit. In comparing actual and potential conflict of interests, the Court therein stated: "An attorney has an
actual, as opposed to a potential, conflict of interest when, during the course of the representation, the attorney's and
[the client'S] interests diverge with respect to a material factual or legal issue or to a course of action .. .In contrast,
'[a] potential conflict of interest exists if the interests of the defendant may place the attorney under inconsistent
duties at some time in the future' ... The 'possibility that future conflicts may arise does not require'
disqualification." Id. at *17-18 (internal citations omitted).
21
August 26, 2013
Page 3
King PLLC, has entered his appearance for CAGNY. (We understood Mr. McGuire to mean,
when he stated that he has not withdrawn as counsel for CAGNY, that he was not withdrawing a
notice of appearance because he had not filed one). This significantly reduces even the
possibility of any conflict.
Respectfully submitted,
~ : . ~
By Email
cc: Raymond McGuire, Esq.
AUSAs Benjamin Torrance and Tara LaMorte
James Murphy, Esq.
22202052v. )