On May 16, the California Supreme Court handed down a decision holding that an attorney may violate his duty of loyalty by publicly opposing a development project that he at one time had been engaged to promote.

Oasis West Realty LLC v. Goldman

In 2004, Oasis West Realty undertook to redevelop and revitalize a nine-acre parcel in Beverly Hills with a five-star hotel and luxury condominiums. It engaged attorney Kenneth Goldman and his law firm, Reed Smith LLP, to provide legal services in connection with the project. Oasis alleged that during the representation Goldman became intimately involved in Oasis’s plan to develop the property, its overall strategy to secure necessary approvals and entitlements from the city, and its efforts to obtain public support for the project.

In 2006, Goldman advised Oasis that he and Reed Smith would no longer represent Oasis in connection with the project.

In 2008, the Beverly Hills city council certified an Environmental Impact Report (“EIR”) and gave preliminary approval for the project. Shortly thereafter, a group of citizens opposed to the project undertook to put a referendum on the ballot, enabling voters to overturn the city’s approval.