In Federal Home Loan Mortgage Corp. v. La Conchita Ranch Co. (1998) 68 Cal.App.4th 856, several homeowners sued a ranch for damage to the homeowners' property caused by irrigation on the ranch. That action was eventually settled. The holder of a security interest in the homeowners' properties, however, also sued the ranch. The holder of the security interest was represented by the same law firm as the homeowners. In response to the action by the holder of the security interest, the ranch filed a cross-complaint against the homeowners. The ranch then moved to disqualify the law firm from representing the holder of the security interest and the homeowners in the action. The trial court denied the motion. (68 Cal.App.4th at pp. 858-860.) The Court of Appeal held the trial court did not abuse its discretion for two reasons. First, the holder of the security interest and the homeowners waived any conflict. And second, the cross-complaint was without merit because the question of liability between the ranch and the homeowners had already been settled. Accordingly, the ranch's attempted creation of a conflict was unsuccessful. ( Id. at pp. 860-863.)