Reddit Accuses Former Law Firm of Switching Sides to Defend Perplexity AI

Reddit is fighting to prevent its former law firm, Proskauer Rose, from representing Perplexity AI in a federal data-scraping lawsuit, alleging that the firm dropped the social media company to take on its courtroom opponent despite an earlier promise to stay out of the case.

In competing filings submitted October 9, 2026, to U.S. District Judge Paul A. Engelmayer in Manhattan, Reddit and Proskauer disputed whether the firm's earlier work on a separate whistleblower lawsuit creates a conflict that prevents it from defending Perplexity in the data-scraping case.

The separate whistleblower lawsuit was brought by former Reddit employee Jutta Williams, who alleged she was fired after raising concerns about the company's data privacy and licensing practices. Proskauer represented Reddit in that case, which involved its licensing arrangements with Google and OpenAI.

That earlier work allegedly exposed Proskauer to confidential information about Reddit's agreements with Google and OpenAI, including practices now at issue in its lawsuit accusing Perplexity of improperly collecting content through Google search results.

After Perplexity approached Proskauer about taking over its defense, the firm sought Reddit's consent and was refused. It subsequently moved to withdraw from the whistleblower proceedings, prompting objections over ongoing discovery and the difficulty of finding replacement counsel.

The social media company eventually agreed to the withdrawal in November 2025 after allegedly receiving assurances that Proskauer would stay out of the Perplexity litigation. The firm disputes that any binding restriction was imposed, setting up the current fight over whether it can represent Reddit's courtroom opponent.

In its defense, Proskauer characterizes the earlier representation as an employment dispute involving retaliation and discrimination allegations, distinct from the data-scraping claims against Perplexity. Attorneys assigned to the new case have also been screened from confidential information obtained while representing Reddit, according to the firm.

The challenge also invokes the "hot potato doctrine," which can prevent lawyers from dropping an existing client to represent another with conflicting interests. Reddit argues that Proskauer withdrew to pursue Perplexity's business and should face the stricter rules governing conflicts involving current clients.

Under the rules governing former-client conflicts, Proskauer argues that disqualification generally requires a substantial relationship between the two matters, a connection the firm disputes in this case.

Perplexity wants to hire Proskauer partly because of the firm's experience defending companies accused of automated web scraping. Its previous clients include SerpApi, which it represented in separate litigation against Google involving technological protections designed to restrict access to search content.

Reddit filed its lawsuit against Perplexity and several data collection companies on October 22, 2025, accusing them of circumventing technological protections to obtain content from the platform in violation of the Digital Millennium Copyright Act. Engelmayer allowed substantial portions of those claims to proceed on July 31, 2026, leaving the defendants facing continued litigation over their alleged data collection practices.

Engelmayer has yet to decide whether Proskauer can take over Perplexity's defense. The company's current attorneys at Keker, Van Nest & Peters have sought permission to withdraw, but the judge has deferred that request until he resolves the dispute over Proskauer's representation.