T. C. Theatre Corp. v. Warner Bros. Pictures

113 F. Supp. 265 (1953)

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Nature of the Case

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Facts

In July 1946, Cooke was retained to represent Universal's (D) interests in the well-known Paramount case. The Court had directed the entry of a final decree, and its formulation and that of the proposed findings of fact and conclusions of law was a matter of considerable importance to all parties in the litigation, including, of course, the defendant universal, with whom we are presently concerned. Cooke as counsel for Universal (D) prepared its proposed findings and decree; appeared at hearings before and the Statutory Court in support thereof and in opposition to those proposed by the government and some of the so-called 'Big Five' defendants. Following the settlement of the findings of fact, conclusions of law, and the entry of the decree, his further activities included general representation of Universal (D) in connection with its appeal to the Supreme Court; obtaining a stay of some of the provisions of the decree; preparation of brief and reply brief and argument before the Supreme Court. On October 17, 1951, Cooke brought suit against Universal (D) for a claimed balance due him on account of services rendered in the Paramount litigation. In that suit, which is still pending, he is represented by Mr. Kahan. This case commenced between January 23, 1952, and May 15, 1952. The complaint alleges that the Ds, including Universal (D), were engaged in a nationwide conspiracy with each other and others unreasonably to restrain trade and they violated Secs. 1 and 2 of the Sherman Act. P has alleged that Ds conspired with each other and with affiliated exhibitors to maintain a system of minimum motion picture prices, they acted in concert in establishing a uniform and fixed system of runs and clearances against independent competitors of the theatre-operating defendants, they entered into master agreements, or blanket deals and formula deals with circuits of theatres, and other non-competitive agreements, and they discriminated, in a number of ways, against independent exhibitors. This is substantially the same nationwide conspiracy that was found to exist in the Paramount case. All the eight distributor-defendants in that action are named as distributor-defendants in this action. Universal (D) seeks to disqualify Cooke because the causes of action asserted by P are based substantially on the identical charges made against it and the other distributor-defendants in the Paramount case. Thus, Cooke will be called upon to prove against Universal (D), his former client, the very charges against which he had earlier defended it. Universal (D) claims that matters of confidence were disclosed to Cooke while he acted as their counsel in the Paramount litigation which are related to the issues at bar and that his current representation of the plaintiff involves, or may involve, the disclosure or use of such confidences. Cooke disputes that the current suit involves the same matters and contends that he received no confidential communications from Universal (D). Cooke posits that his services as appeal counsel in the Paramount case were based upon the 'cold record' and that prior to his entry into the case, the government had fully exposed and made publicly available all the defendants' files and records, including, of course, Universal's (D).