Phoenix Founders, Inc. v. Marshall

In Phoenix Founders, Inc. v. Marshall, 887 S.W.2d 831, 834-35 (Tex. 1994) the Texas Supreme Court has held that when a paralegal works on a case at one firm, and then moves to another firm on the opposing side of that litigation, two presumptions come into play. First, there is a conclusive presumption that the paralegal acquired confidential information during his work on the case at the first firm. Id. at 834. Second, there is a rebuttable presumption that the paralegal shared confidential information about the case with the members of the new firm. Id. at 835. This second presumption may be rebutted by a showing "that sufficient precautions have been taken to guard against any disclosure of confidences." Id. The presumption that confidential information will be imparted to a new employer can be rebutted by a showing that certain precautions have been taken to safeguard client confidences: "Specifically, the newly-hired paralegal should be cautioned not to disclose any information relating to the representation of a client of the former employer. The paralegal should also be instructed not to work on any matter on which the paralegal worked during the prior employment, or regarding which the paralegal has information relating to the former employer's representation. Additionally, the firm should take other reasonable steps to ensure that the paralegal does no work in connection with matters on which the paralegal worked during the prior employment, absent client consent after consultation." Id.