Edward Cresswell V. Sullivan & Cromwell And Prudential-Bache Securities (12/10/90‪)‬

Plaintiffs Edward Cresswell, et al., appeal from a final judgment of the United States District Court for the Southern District of New York, Robert W. Sweet, Judge, 704 F. Supp. 392, principally (1) dismissing so much of their second amended complaint as charged defendant Sullivan & Cromwell ("S&C") with fraudulent nondisclosure during discovery in a prior action by plaintiffs against S&C's client, defendant Prudential-Bache Securities, Inc. ("Bache"), and (2) voiding agreements relating to plaintiffs' representation in the present action by their former attorney. The district court granted summary judgment dismissing the complaint against S&C on the ground that plaintiffs could not show justifiable reliance on the challenged nondisclosure; it barred plaintiffs' former attorney from representing them and receiving a contingent fee in the present action because he would be an essential witness at trial. On appeal, plaintiffs contend principally that summary judgment was inappropriate because the question of whether their reliance was justifiable raised a genuine issue of material fact; and they contend that the orders with regard to their former attorney should be set aside. For the reasons below, we vacate the judgment dismissing the claims against S&C and remand for further consideration by the district court.