Westinghouse Electric Corporation v. Gulf Oil Corporatio

588 F.2d 221 (7th Cir. 1978)

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Nature of the Case

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Facts

Westinghouse (P) commenced litigation against a number of parties engaged in, or having interests in, the mining of uranium. P alleged an international cartel influenced the price of uranium. D and the respondent, United Nuclear Corporation (UNC) are two of the named defendants in P's action. UNC is being represented by Bigbee, which had previously performed legal work on behalf of D. D, accordingly, moved to disqualify the Bigbee firm. In 1971, D retained the Bigbee firm to represent it on legal matters relating to D's uranium operations in New Mexico. From 1971 through 1976, the Bigbee firm through nine of its twelve attorneys performed numerous services for D including the patenting of fifty-nine mining claims, drafting leases required for uranium exploration, representing D in litigation involving title disputes, counseling D in relation to the resolution of certain problems relating to mine waters, and lobbying on behalf of D in front of the New Mexico state legislature on tax and environmental matters. One of Bigbee's name partners, spent over 2,000 hours working on behalf of D. D claimed that the matters on which Bigbee represented D were substantially related to the matters raised in P's litigation. Mt. Taylor properties constituted D's largest supply of uranium and were not currently in production, and the reasons for D's failure to produce from this property would be material to P's allegations that the conspirators withheld uranium supplies from the market. D also claimed it had entrusted Bigbee with confidential information relating to the quantity and quality of uranium reserves in the Mt. Taylor properties. D also stated that UNC was attempting to exculpate itself by inculpating D. The court ruled that the prior work 'focused on real estate transactions connected with D's untapped and undeveloped uranium reserves,' whereas the 'heart of the complaint' details a price-fixing conspiracy, the evidence of which 'will focus on meetings and communications among the alleged co-conspirators, as well as evidence on uranium prices, terms and conditions of sale, and market availability.' Since there was no substantial relationship between the matters, Bigbee need not be disqualified. D appealed.