Westinghouse Elec. Corp. v. Gulf Oil Corp.

In 1968, large uranium reserves were discovered in New Mexico. By 1971, Gulf Oil Corp. (codefendant) had acquired a substantial portion of those reserves, known as the Mt. Taylor properties. For the next five years, the law firm Bigbee, Stephenson, Carpenter & Crout (Bigbee) represented Gulf in connection with its New Mexico uranium operations. Nine of Bigbee’s 12 attorneys handled Gulf work, including numerous mining patents and real estate transactions. One Bigbee partner alone spent over 2,000 hours on Gulf work. In 1976, Westinghouse Electric Corporation (plaintiff) brought an antitrust suit against multiple uranium suppliers, including Gulf and United Nuclear Corporation (UNC) (codefendant), alleging that they colluded to fix uranium prices. Bigbee appeared on behalf of UNC—not Gulf. Gulf moved to disqualify Bigbee, arguing that its previous representation was substantially related to issues raised in the antitrust suit. Specifically, Gulf was not producing uranium from Mt. Taylor, although it constituted Gulf’s largest uranium supply at the time. Gulf argued that its reasons for not producing Mt. Taylor uranium would be material to Westinghouse’s allegations that mining companies were withholding uranium supplies to artificially inflate prices. Gulf also argued that it was adverse to UNC in the antitrust suit because UNC was trying to exculpate itself by inculpating Gulf. But the trial judge refused to disqualify Bigbee, reasoning that the prior representation focused on real estate transactions connected with undeveloped reserves, whereas the antitrust suit alleged a price-fixing conspiracy that would focus on arguably unrelated discussions among uranium suppliers. Gulf appealed.