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PCG Trading, LLC v. Seyfarth Shaw, LLP, et al. Opinion Summary: PCG Trading filed a complaint for legal malpractice and related claims against Seyfarth Shaw and four individual attorneys associated or formerly associated with the firm. At issue was whether a motion filed by PCG Trading for admission of an attorney pro hac vice was properly denied by a judge in the Superior Court. The court held that the order denying the motion to admit Robert L. Garner pro hac vice was reversed, and the case was remanded to the Superior Court for further proceedings.

PCG TRADING, LLC vs. SEYFARTH SHAW, LLP, & others. [FN1] SJC-10807. April 7, 2011. - July 29, 2011. Attorney at Law, Admission pro hac vice. Rules of Professional Conduct. CIVIL ACTION commenced in the Superior Court Department on July 29, 2009. A motion for admission of an attorney pro hac vice was heard by Margaret R. Hinkle, J. The Supreme Judicial Court on its own initiative transferred the case from the Appeals Court. Robert L. Garner (Matthew J. Walko with him) for the plaintiff. Robert J. Muldoon, Jr. (David M. Dineen with him) for the defendants. Present: Ireland, C.J., Spina, Cordy, Botsford, Gants, & Duffly, JJ. BOTSFORD, J. PCG Trading, LLC (PCG), has filed a complaint for legal malpractice and related claims against Seyfarth Shaw, LLP, and four individual attorneys associated or formerly associated with the firm. The sole issue raised in this appeal is whether a motion filed by PCG for admission of an attorney pro hac vice was properly denied by a judge in the Superior Court. We conclude that PCG's motion should have been allowed. 1. Background. The following facts are taken from the allegations of PCG's amended complaint pending in the Superior Court. Seyfarth Shaw's representation of PCG in Massachusetts arose in connection with two lawsuits that originated in California. In 2002 and in 2005, respectively, Ellen Costigan obtained two judgments against the company Converge, LLC, and its parent, Converge, Inc. (collectively Converge), in California [FN2]; Seyfarth Shaw represented Converge in connection with both cases. Costigan had been an employee of Converge, [FN3] and the first action was one for unpaid wages, brought before the California Labor Commission (commission) in 2001. The commission awarded Costigan approximately $130,000 in unpaid wages, interest, and penalties. Seyfarth Shaw, on behalf of Converge, unsuccessfully appealed the award to the California Superior Court, and on November 2, 2002, the court entered judgment against Converge on the commission's award. At some point in this time period, Converge relocated to Massachusetts, and on November 29, 2002, Costigan commenced an action against Converge in the Superior Court for Essex County seeking to enforce the unpaid wages judgment (Essex County action). In March of 2003, PCG purchased substantially all of Converge's assets. Under the terms of the asset purchase agreement, Converge remained responsible for Costigan's two claims against Converge, and agreed to indemnify PCG for any losses arising out of them. Seyfarth Shaw at the time continued to represent Converge in connection with Costigan's claims, but also took on PCG as a client for various matters. However, Seyfarth Shaw did not disclose to PCG any actual or potential conflicts of interest relating to its representation of both Converge and PCG. On May 16, 2003, less than two months after the asset purchase of Converge by PCG, Seyfarth Shaw filed an unsealed motion to withdraw as counsel for Converge in the Essex County action. In the motion, Seyfarth Shaw stated:

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"Seyfarth Shaw is informed, and therefore believes, that [Converge]: (i) is no longer in business; (ii) no longer has any employees, other than several directors and officers outside of Massachusetts, or any facilities; (iii) has no tangible or intangible assets in Massachusetts; and (iv) cannot pay Seyfarth Shaw for additional services.... "Seyfarth Shaw's withdrawal will not result in a material adverse effect on [Converge]. Even assuming, arguendo, that [Costigan's] Motion for Summary Judgment is allowed, that ruling will have no effect on [Converge]. [Costigan's] action is solely to enforce a judgment of a foreign jurisdiction. [Converge] has no assets in Massachusetts. Therefore, [Costigan] will be unable to enforce in Massachusetts the judgment [she] obtains, if any, against [Converge] in this action." Seyfarth Shaw's motion to withdraw was allowed, and Converge thereafter was defaulted. In December, 2003, judgment entered in the Essex County action against Converge in the amount of $143,840.67. Converge did not pay the judgment. In March of 2002, Costigan filed an action against Converge alleging sex discrimination and wrongful discharge in the California Superior Court. Seyfarth Shaw, representing Converge, removed the case to the United States District Court for the Central District of California. Later, and over Converge's objection, Seyfarth Shaw withdrew from representing Converge. Converge defaulted in the action as a result of Seyfarth Shaw's withdrawal, and a default judgment of more than $3 million entered against Converge in November, 2005. On July 25, 2006, Costigan commenced an action in the Superior Court for Norfolk County (Norfolk County action) against PCG and Converge, seeking to enforce against both companies the 2005 California default judgment and to enforce against PCG only the 2002 unpaid wages judgment. Seyfarth Shaw represented PCG in this action; Converge did not appear. In July, 2007, following a bench trial, a Superior Court judge found that the 2003 asset purchase of Converge by PCG was a de facto merger of the two companies as well as a fraudulent transfer, thereby rendering PCG liable for both of Costigan's California judgments against Converge. Soon thereafter, judgment in the Norfolk County action entered against PCG in the amount of $3,323,802 plus interest. In December, 2007, PCG, represented by new counsel, entered into a settlement agreement with Costigan, and PCG's appeal from the Norfolk County judgment was dismissed. PCG filed the present action against Seyfarth Shaw in the Superior Court for Suffolk County in July of 2009. The amended complaint includes claims for legal malpractice, breach of contract, breach of fiduciary duty, and violation of G.L. c. 93A, based in substantial part on Seyfarth Shaw's alleged conflict of interest arising from its dual representation of Converge and PCG in connection with the Costigan claims, and failure to advise PCG of that conflict. [FN4] On or about October 2, 2009, PCG served on Seyfarth Shaw a motion to admit both William A. Brewer, III, and Robert L. Garner, pro hac vice as PCG's trial counsel. Garner is a senior counsel in the New York City office of the Dallas-based law firm of Bickel & Brewer, and Brewer is a partner in the same firm. Garner is a member in good standing of the State bars of New York and New Jersey. Although Seyfarth Shaw initially assented to PCG's motion, PCG never filed it with the court. Instead, on October 29, PCG filed a motion to admit only Garner pro hac vice. Also on October 29, an article appeared in an Internet issue of the National Law Journal entitled, "Former client sues Seyfarth Shaw, claiming malpractice, conflict of interest." The article summarized many of the allegations of PCG's complaint, and in particular, included the following: "According to the lawsuit, Seyfarth's mistakes include filing an unsealed motion to withdraw from representing Converge in Essex County Superior Court when Costigan filed suit there to enforce the California wage judgment. PCG argues that Seyfarth's description of Converge as an insolvent, virtually nonexistent company 'would provide ammunition for Costigan to assert a successor liability claim.' "PCG's lawyer, Bill Brewer of Dallas-based Bickel & Brewer, said PCG's deal with Converge was structured as an asset purchase not a merger. " 'The difficulty is that Seyfarth [filed court] papers in an attempt to relieve itself of its responsibility to another client
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of theirs, Converge, that not only misstated the facts, but stated the facts in a way that supported their [ [FN5]] notion of [PCG's] successor liability.' "Taking this position when withdrawing from the Converge case jeopardized Seyfarth's fiduciary responsibility to PCG, he said." (Emphasis added.) In response to this article, Seyfarth Shaw withdrew its assent to PCG's motion to admit Garner pro hac vice, and filed an opposition. A Superior Court judge (motion judge) held a hearing on the motion on November 19, 2009. Seyfarth Shaw argued primarily that Brewer's comment quoted in the article violated Mass. R. Prof. C. 3.6, 426 Mass. 1392 (1998), and served as a ground to deny the motion to admit Garner pro hac vice. The motion judge denied PCG's request for Garner's pro hac vice admission. PCG appealed from the denial to the Appeals Court, and we transferred the case to this court on our own motion. [FN6] 2. Discussion. "[A] member of the bar, in good standing, of any other state may appear, by permission of the court, as attorney or counselor, in any case pending therein, if such other state grants like privileges to members of the bar, in good standing, of this commonwealth." G.L. c. 221,

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