The opinion of the court was delivered by: ALESIA
This matter is before the Court on Plaintiffs' motion to disqualify the law firm of Winston & Strawn as counsel for Defendant McDonald's Corporation. For the reasons discussed hereafter, the motion is granted.
A. GDR and Rice v. AFTEC and Tippman
GDR Enterprises Inc. ("GDR") is a company run by George D. Rice, a well known consultant in the food service industry. Prior to Tippman's involvement in AFTEC, AFTEC entered into an agreement with GDR to pay GDR a "finder's fee" if it found a buyer for AFTEC. Rice was to be paid a fee of $ 58,000 and receive a 10% equity interest in AFTEC or its successor.
Following the sale of AFTEC's stock to Hooker and Tippman, Rice never received his finder's fee or his ownership interest in AFTEC. Consequently, Rice and GDR brought a breach of contract action against Tippman and AFTEC ("the GDR case"). Tippman hired the law firm of Winston & Strawn to represent AFTEC and himself in the matter. The GDR case settled during trial.
B. AFTEC, et al. v. McDonald's Corporation, et al.
In the instant case, AFTEC and Thermodyne Food Service Products Inc. ("Thermodyne") bring a trade secret infringement action
against McDonald's and other defendants.
Tippman is the majority shareholder of both AFTEC and Thermodyne. The companies focus their resources on the development of food service products and systems. The two companies enjoy somewhat of a symbiotic relationship -- Thermodyne is the manufacturing and sales arm and AFTEC is the research and development arm.
Their claim to fame is the development of "Thermodyne technology" for transferring heat to food items. Generally speaking, the Thermodyne technology uses precise computer controls and the interrelationship of numerous component parts to cook and hold food items at lower temperatures through conduction processes, rather than by means of convection heat. The benefit is that the conduction method of cooking and holding food items reduces water loss and the risk of harmful bacteriological development.
AFTEC and Thermodyne allege that McDonald's (and other defendants) acquired knowledge of the Thermodyne technology through improper means in violation of the Illinois Trade Secrets Act, 765 ILCS 1065. The complaint was filed in the summer of 1995. On December 18, 1996, Winston & Strawn -- following a ruling on McDonald's summary judgment motion in October of 1996-- entered its appearance on McDonald's behalf.
AFTEC argues that Winston & Strawn cannot defend McDonald's against its claims in the instant matter since Winston & Strawn previously represented AFTEC in a "substantially related" case and likely possesses relevant confidential information from the prior representation. The Court finds that the GDR case and the instant case are "substantially ...