Westinghouse Electric Corporation v. Kerr-Mcgee Corporation

580 F.2d 1311 (1978)

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Nature of the Case

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Facts

Congress wanted to break up the oil companies. The American Petroleum Institute (API) began a campaign to lobby against the proposals. As part of this effort, Kirkland's Washington office was retained to review the divestiture hearings and 'prepare arguments for use in opposition to this type of legislation.' Kirkland was to also work in preparation of possible testimony, analyzing the probable legal consequences and antitrust considerations of the proposed legislation' and 'you should make an objective survey and study of the probable effects of the pending legislation, specifically including probable effects on oil companies that would have to divest assets.' Kirkland was to act as an independent expert counsel and hold any company information learned through these interviews in strict confidence, not to be disclosed to any other company, or even to API, except in aggregated or such other form as will preclude identifying the source company with its data. Kirkland gathered information from 59 API members. In the final report references to uranium appear on 25 pages of text and 11 pages of exhibits. It makes a number of conclusions about the uranium industry and that the industry as a whole is competitive. On the same day, the API report was issued, P filed suit against Ds for antitrust violations. It just so happens that P was represented by Kirkland and three of the defendants in this suit Gulf Oil Corporation ('Gulf'), Kerr-McGee Corporation ('Kerr-McGee') and Getty Oil Company ('Getty'), were members of API. Ds moved to disqualify Kirkland. Noranda Mines Limited ('Noranda'), asserts a different conflict of interest in Kirkland resulting from its prior representation of Noranda from 1965 to 1967 in several matters. The district court denied the motions. The district court concluded that 'a comparison of the two documents reveals a rather basic conflict in their contentions and underlying theories.' The district court took the view that an 'attorney-client relationship is one of agency to which the general rules of agency apply' and 'arises only when the parties have given their consent, either express or implied, to its formation.' The district court first determined that there existed no explicit or express attorney-client relationship in that no oil company representative requested Kirkland to act as its attorney orally or in writing and Kirkland did not accept such employment orally or in writing. Ds appealed.