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Click here for the full text of this decision FACTS:In 1993, Kajima Int’l sued Formosa Plastics Corp. for breach of contract, fraud, quantum meruit and negligent representation arising from construction contracts Kajima performed at Formosa’s plant in Point Comfort. When the litigation began, Formosa hired Jones, Day, Reavis & Pogue as its law firm. Jones Day subsequently retained Steve Huyghe in California and his employer, A. W. Hutchinson & Associates (AWHA) in Atlanta as consulting experts. Huyghe and Jones Day attorneys met in October 1993, and Huyghe and AWHA performed various work for Formosa. Formosa paid AWHA more than $20,000 by the end of 1993. In December 1993, Formosa transferred its defense to Porter & Hedges. Huyghe met with lawyers from this new firm, but he was told in April 1994 that his work for Formosa was “on hold.” In August 1994, Kajima’s lead counsel contacted Huyghe about AWHA working on the case for Kajima. Huyghe notified an attorney at Jones Day to tell her that he had been contacted by Kajima, though he ignored her advice to notify Porter & Hedges. In the meantime, Kajima hired A. W. “Chip” Hutchinson, also of AWHA in Atlanta. Formosa did not learn of their work for Kajima until Sept. 19, 1995. Two weeks later, Formosa filed a motion to strike Hutchinson and AWHA as Kajima’s expert witnesses for “side-switching.” The trial court denied the motion. The first trial in 1997 resulted in a $5.5 million award for Kajima, but an appeal of that award resulted in a new trial. At the second trial, Kajima non-suited all but the fraud claims. This trial resulted in a $30 million award, including pre-judgment interest and costs. Formosa raises nine issues on appeal. HOLDING:Reversed and remanded. The court addresses only one issue raised by Formosa: that of side-switching by Hutchinson and AWHA. Kajima contends that Hutchinson need not have been disqualified because Huyghe and Hutchinson were in separate offices; because any information Formosa gave Huyghe was discoverable, not confidential; because Formosa did not directly share confidential information with Huyghe or Hutchinson; and because attorney vicarious-qualification rules that apply to law firms do not apply to expert firms. The court acknowledges that the issue of disqualifying expert witnesses for switching sides is one of first impression in Texas. The court adopts the two part test used in Koch Ref. Co. v. Jennifer L. Boudreaux MV, 85 F.3d 1178 (5th Cir. 1997), to conduct its analysis: 1. was it objectively reasonable for the first party who claims to have retained the expert to conclude that a confidential relationship existed between that party and the expert; and 2. did the first party disclose any confidential or privileged information to the expert? As to the first factor, the court takes note of such evidence as invoices for work on the “Kajima case,” copies of checks for the $20,000 worth of work Formosa paid AWHA for, and several letters referred to as the “work product” of Huyghe. The court concludes that it was objectively reasonable for Formosa to conclude that a confidential relationship existed with Huyghe and AWHA. As to the second factor, the court notes that in several meetings between the Jones Day attorney and Huyghe, Formosa’s case strategies were discussed, as were interviews with potential witnesses and the amount of money Formosa was willing to pay to settle Kajima’s claims. There was also testimony from Huyghe himself stating that his California office was nonetheless part of the AWHA firm as a whole, and that letters between Huyghe and both Jones Day and Porter & Hedges were copied to Hutchinson. The court thus finds it reasonable to conclude that the information provided to Huyghe was provided to AWHA and to Hutchinson. The court then looks at the substance of Hutchinson testimony for Kajima during the second trial, which the court says involved all aspects of Kajima’s case, including liability, causation and damages. The testimony should not have been included, and the court holds that without this testimony, the judgment cannot stand. The court rebuts the dissent’s finding that Formosa waived its right to seek disqualification of Hutchinson and AWHA. OPINION:Yanez, J.; Hinojosa, Yanez and Castillo, JJ. DISSENT:Castillo, J. The dissent conducts a full analysis of the nine points raised by Formosa on appeal and would reject all of them, affirming the trial court judgment. On the issue of Hutchinson’s and AWHA’s disqualification, the dissent states that Formosa had at least five opportunities to establish with Huyghe that AWHA and Huyghe were to maintain the confidentiality of any information acquired and work product generated on Formosa’s behalf. Failure to take up any of these opportunities resulted in Formosa’s waiver of the issue.

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