A lawyer for Sheppard, Mullin, Richter & Hampton faced a string of tough questions from justices of the California Supreme Court Wednesday about the firm’s decision to keep client J-M Manufacturing Company Inc. in the dark about a conflict that led to the firm’s disqualification in a high-stakes whistleblower case.
J-M, the world’s largest maker of PVC pipe, hired Sheppard Mullin in 2010 to defend it in qui tam litigation involving more than $1 billion in claims related to allegedly substandard pipe the company provided to government entities. When hired, though, Sheppard Mullin didn’t disclose the firm previously handled labor and employment work for South Tahoe, one of the municipalities involved. Although an internal firm conflict check flagged the issue, J-M wasn’t informed until after South Tahoe sought to disqualify Sheppard Mullin.
