Plein v. USAA Casualty Insurance Co.

Irene Hecht, an attorney at Keller Rohrback LLP (Keller), previously represented USAA Casualty Insurance Company (USAA) (defendant) in bad-faith litigation. During the same time, Hecht’s team defended a USAA subsidiary in a matter known as Cueva, in which the Cuevas alleged insurance bad faith after a fire. Richard and Debra Plein (plaintiffs) insured their home with USAA. The Pleins sued USAA for bad-faith insurance practices after a fire at their home. William Smart and Ian Birk, attorneys at Keller, represented the Pleins. USAA threatened to file a motion to disqualify Keller. The Pleins asked the court to issue a ruling on the alleged conflict under Washington Rule of Professional Conduct 1.9(a). That rule provided that an attorney who previously represented a client in a matter may not thereafter represent another person in the same or a substantially related matter if that person’s interests are materially adverse to the former client’s and the former client does not consent. In arguing that Keller should be disqualified, USAA noted that Keller obtained general information about USAA’s confidential claims-handling practices, business philosophies, and litigation strategies through its prior representation of the company. The trial court found that the Pleins’ case was not substantially related to the prior cases in which Keller had represented USAA. Accordingly, the trial court did not disqualify Keller. The appellate court reversed. The Washington Supreme Court granted review.