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In re Nitla S.A. de C.V. | 32 S.W.3d 419 (2002)
If it was undeniable that one player saw another’s hand at the poker table, chances are that player would be disqualified, right? But how might that work in the middle of discovery if one party’s attorney has a chance to review the other party’s privileged documents? The two thousand two Texas case of In re Nitla S.A. de C.V. explores this very question.
Nitla was a Mexican pharmaceutical company and client of Bank of America. When Nitla suspected Bank of America of misappropriating funds, it brought suit in trial court. During discovery, Bank of America refused to turn over documents for which it asserted work-product and attorney-client privilege. After the court conducted an in-camera review of the documents in question, it found several of the documents to not be privileged and ordered Bank of America to produce them. Bank of America petitioned the court for a stay of production after a second hearing on the matter, contending that opposing counsel’s review of the documents would irreparably harm the bank’s case. It further contended that, if the appellate court later determined the documents were privileged, opposing counsel would have to be disqualified. Notwithstanding these arguments, the trial court provided Nitla with the documents, which were extensively reviewed by its counsel.
After Bank of America petitioned the appellate court for mandamus relief, the appellate court had a new trial court judge review the previous judge’s determination. After a new hearing, the second trial court judge agreed with the first judge that the documents weren’t privileged, but ordered their return to Bank of America, pending review by the appellate court. When the appellate court found most of the documents to be privileged, the bank moved the court to disqualify Nitla’s counsel who had already reviewed them. The trial court denied the motion, and Bank of America sought mandamus relief from the trial court’s decision denying disqualification. The appellate court ordered Nitla’s counsel to be disqualified, and Nitla petitioned the state supreme court to mandamus the appellate court. The motion was denied, but the state supreme court granted Nitla’s motion for a rehearing to vacate the appellate court’s disqualification judgment.
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