Ethics in Brief: Lessons from the Disqualification of Quinn Emanuel inCoStar Group, Inc. v. Commercial Real Estate Group, Inc., Case No.: 2:20-cv-8819-CBM(ASx) (C.D. Cal.)
By Caitlin Jones
An attorney-client relationship built upon a conflict of interest is a house of cards.
Such was the house Quinn Emanuel constructed when it chose to represent Commercial Real Estate Exchange, Inc. (“CREXi”) in long-running copyright infringement litigation against CoStar Group, Inc.—Quinn Emanuel’s then-current client in a separate and unrelated case. Judge Consuelo B. Marshall disqualified Quinn Emanuel from representing CREXi in a July 13, 2026 order focusing on the breach of the duty of loyalty that occurs when representing one current client adversely to another.
The order disqualifying Quinn Emanuel is unsurprising, both in its result and in its straightforward application of decades of precedent regarding the duties of loyalty and confidentiality in concurrent client representation. What is surprising are two notable facts deftly woven into an otherwise ordinary decision: Quinn Emanuel’s conflict check had “not yet” picked up on the conflict (though the representation was well underway), and Quinn Emanuel failed to secure an adequate conflict waiver.
Admittedly, conflicts of interest can be complicated and nuanced. When faced with a potential conflict scenario, attorneys must work through whether the adversity involves a current client (Rule 1.7) or former client (Rule 1.9); whether the conflict is potential or actual; and whether the conflict can even be waived at all. Attorneys must consider whether the potentially conflicted representation might require them to disclose the confidences of another client, or to act adversely to a client in a way that violates the attorney’s duty of undivided loyalty.
The answers to these questions are not always obvious at the outset, but employing basic procedures can safeguard against conflicted representation. Every firm needs a conflict-checking procedure that works. Not all methods of conflict-checking are created equal. Conflict checks can fail where they do not adequately capture current and prior relationships because, for example, the firm checks the business entity but not its principals, parent companies, or subsidiaries.
If there exists a potential or actual conflict, the attorney must secure an adequate conflict waiver in which the client gives informed written consent to the representation. Informed written consent, of course, hinges on the consent being both “informed” and in writing. “Informed”, in the context of conflict waivers, means that the lawyer has explained the relevant circumstances and the risks of proceeding with the representation, including “any actual and reasonably foreseeable adverse consequences of the proposed course of conduct,” and the client understands and accepts the risk. (Rules of Professional Conduct, Rule 1.0.1.) The conflict check and the conflict waiver are the foundational pillars that support the attorney-client relationship when potential conflicts arise.
CoStar is a cautionary tale for the importance of diligently employing conflict procedures. On August 15, 2025, Quinn Emanuel entered an appearance as counsel for CoStar Group in Kutagula v. CoStar Group, Inc. et al., No. 5:25-cv-05383 (N.D. Cal.). Four months later, Quinn Emanuel substituted in as counsel for CREXi in its case against CoStar. CoStar filed a motion to disqualify Quinn Emanuel from representing CREXi against it in the Central District litigation. CoStar argued Quinn breached its duty of loyalty to CoStar by representing its adversary without securing CoStar’s informed written consent.
CREXi countered by arguing Quinn Emanuel had an engagement letter with a CoStar affiliate called Matterport that purported to waive future conflicts. However, the waiver was ineffective for two reasons. First, at the time the engagement letter was signed, CoStar had not yet acquired Matterport, and there was no agreement or term showing the letter would apply to affiliates. Second, the waiver was boilerplate and did not specifically discuss the conflict with CoStar, which hadn’t arisen yet. Written consent to the conflict cannot be “informed” if there is no explanation of the circumstances and the risks of proceeding with the representation.
Quinn Emanuel also argued there was no breach of the duty of loyalty because the cases were unrelated, the clients were represented by different attorneys within the firm, and the firm put up an ethical wall to screen the affected attorneys. No matter; because CoStar did not provide informed consent, the concurrent representation was a breach of Quinn Emanuel’s duty of loyalty to CoStar and disqualification was warranted.
The decision serves as a reminder that successful conflict management depends as much on disciplined law firm processes as on sophisticated legal analysis. Even the most experienced lawyers cannot properly analyze a conflict that is never identified, and no amount of advocacy can salvage a conflict waiver that is fundamentally lacking.
