Opinion
No. SA-03-CA-49-RF
December 22, 2003
ORDER DENYING DEFENDANT'S MOTION TO DISQUALIFY
BEFORE THE COURT is Defendant's Motion to Disqualify Plaintiffs' counsel Mark Greenwald, filed on November 20, 2003. Plaintiffs' Response was filed on December 1, 2003. After careful consideration, it is the opinion of the Court that Defendant's Motion to Disqualify (Docket No. 94) should be DENIED.
Factual and Procedural Background
The facts and underlying procedural history are well known to the Court and have recently been set forth in detail in the Court's Order addressing class certification. Essentially, Plaintiffs are police officers employed by the City of San Antonio ("the City") who complain, under the Federal Fair Labor Standards Act, 29 U.S.C. § 201 et seq ("FLSA") that the City failed to pay overtime wages for overtime hours worked.
The City convened a public hearing regarding the related matter of a proposed collective bargaining agreement ("CBA") between the City and the San Antonio Police Department ("SAPD") on November 13, 2003. Plaintiffs' counsel, Mark Greenwald, appeared at that hearing and spoke with the City Council on the issue. Mr. Greenwald admits this point, as he submitted video reproduction of the event to this Court as an exhibit attached to Plaintiffs' Reply to Defendant's Response to Plaintiff's Motion to Facilitate Notice. The parties dispute, however, whether this appearance and the contents of Mr. Greenwald's statements require his disqualification from the instant representation of Plaintiffs.
Docket No. 100, Ex. 5.
Discussion
A motion to disqualify counsel is governed by the relevant ethical rules. "In the Fifth Circuit, courts are obliged to stem unethical conduct taking place in any proceeding before them. Therefore, a party may appropriately utilize a motion to disqualify to inform the Court of a breach of ethical duties." Such a motion may, however, be viewed with caution because it can be misused for purposes of harassment. The party moving for disqualification bears the burden of demonstrating that disqualification is the proper and necessary remedy. In the event of attorney misconduct, federal courts "possess `an arsenal of sanctions' that can be imposed for an attorney's unethical behavior."
Cramer v. Sabine Transportation, Co., 141 F. Supp.2d 727, 730 (S.D. Tex. 2001) (citing In re Dresser Indus. Inc., 972 F.2d 540, 543 (5th Cir. 1992) and In re American Airlines, Inc., 972 F.2d 605, 610 (5th Cir. 1992)).
Id. at 730 (citations omitted).
See FDIC v. United States Fire Insurance Co., 50 F.3d 1304, 1315 (5th Cir. 1995) (discussing the need for caution in the context of a motion to disqualify alleging a conflict of interest).
Cramer, 141 F. Supp.2d at 733. See also Duncan v. Merrill Lynch, Pierce, Fenner Smith, Inc., 646 F.2d 1020, 1028 (5th Cir. Unit B 1981), criticized and questioned on other grounds.
Cramer, 141 F. Supp.2d at 731 (quoting Erickson v. Newmar Corp., 87 F.3d 298, 303 (9th Cir. 1996).
Defendant claims that Greenwald's conduct at the public hearing violated Texas Disciplinary Rule of Professional Conduct 4.02(a).
TEX. DISCIPLINARY R. PROF. CONDUCT 4.02(a) (1998), reprinted in TEX. GOV'T CODE ANN., tit. 2, subtit. G app. (Vernon Supp. 2003) (STATE BAR RULES art. X, § 9). The United States District Court for the Western District of Texas has adopted the standards of the Texas Disciplinary Rules of Professional Conduct, as well as the Code of Professional Responsibility of the American Bar Association. See W.D. TEX. LOCAL R.AT-4 (2003).
Rule 4.02(a) provides:
In representing a client a lawyer shall not communicate or cause another to communicate about the subject of representation with a person or organization a lawyer knows to be employed or retained for the purpose of conferring with or advising another lawyer about the subject of the representation, unless the lawyer has the consent of the other lawyer or is authorized by law to do so.
Defendant argues that the City Council is the policymaking and managerial authority for the City and therefore falls within the scope of subsection (c) which defines an "organization or entity of government." TEX. DISCIPLINARY R. PROF. CONDUCT 4.02(c). An organization or entity of government is a person with a "managerial responsibility . . . that relates to the subject of the representation," or a person "presently employed by such organization or entity and whose act or omission in connection with the subject of representation may make the organization or entity of government vicariously liable for such act or omission." Id. Plaintiffs do not dispute this characterization.
The parties essentially dispute (1) whether Greenwald's appearance and public speech constituted communication on the subject of the representation and if so, then, (2) whether any such communication was ex parte or otherwise unauthorized by law.
Defendant urges the application of a two-step analysis under Shelton v. Hess, In Shelton, the Court faced an alleged violation of former Canon 9 and articulated the Fifth Circuit's two-part test for the analysis of a motion to disqualify in situations, like the instant one, where improper ex parte communications with a party in absence of his counsel or counsel's permission. Noting the likelihood of the impropriety of a motion to disqualify, the Shelton court stated that the movant must first show "at least a reasonable possibility that some specifically identifiable impropriety did in fact occur" and must then show that "the likelihood of public suspicion or obloquy outweighs the social interests which will be served by a lawyer's continued participation in the particular case." In addition, the Fifth Circuit includes a balancing of potential prejudices to the involved parties.
599 F. Supp. 905, 909 (S.D. Tex. 1984).
Shelton v. Hess, 599 F. Supp. 905, 909 (S.D. Tex. 1984) (citing, in part, to Woods v. Covington County Bank, 537 F.2d 804, 813 (5th Cir. 1976)).
Id.
With respect to the first prong, the parties cannot dispute the contents of the communication because both have submitted video recording of the event to the Court. In addition to arguing the Defendant has generally failed to carry its burden on the motion, Plaintiffs also argue that Defendant fails to regard the context of Greenwald's communication to the City Council in evaluating the ethical rules' application to the conduct. In essence this argument admits that the specific content of the communication is not in dispute. More importantly, this argument implies that the specific content of the communication did concern the representation. Having viewed the videotapes, the Court finds that Greenwald's comments did, in pointed fact, concern "the subject of the representation." Defendant rightly points, as examples, to Greenwald's discussion of the following issues concerning the subject of the representation: the valuation of the lawsuit; the City's failure to properly value the lawsuit; the possibility that, were this Court to grant a Rule 23 class certification, the size of the class would rise to over 2000 plaintiffs; that the Court had made certain determinations with respect to the value of Plaintiffs' case; and that the proposed CBA was merely a containment device for costs associated with the instant lawsuit. Such conduct, in a vacuum, exhibits, at minimum, a distressing lack of restraint on the part of counsel.
The Court denied to certify a Rule 23 class on Plaintiffs' state law claims in its Order dated December 3, 2003, Docket No. 101. Instead, the Court remanded the state law claims and granted a conditional class on the claims arising under the Fair Labor Standards Act, 29 U.S.C. § 216(b).
However, such comments were not made in a vacuum, and Plaintiffs are correct that the overall context must be considered. These comments were not made to a lone litigant, subject to influence, in the alleyways without the presence or knowledge his counsel. These comments were made in a public forum, after public hearing notices were posted, to the entire City Council, in the presence of its multiple counsel, including the counsel representing the City in the instant dispute. Thus, while Defendant has carried its burden with respect to the first prong of the Shelton test, it has failed with respect to the second.
Under the second prong, the Court considers whether public suspicion is likely to outweigh the social interest in permitting the attorney to continue representation. In support of its argument on this prong, Defendant offers that because Plaintiffs enjoy the representation of three attorneys, they will not miss one by virtue of disqualification. The Court is not convinced by this suggestion, but finds instead that Plaintiffs have repeated in briefing and in oral arguments that Greenwald and Kern now provide the lead counsel to Plaintiffs in this matter, while Ms. Fisher remains only as associate counsel. The Court declines to disqualify Greenwald on this ground.
See Shelton, 599 F. Supp. at 909 (citing Woods, 537 F.2d at 813).
The City also argues that the behavior of Greenwald here sufficiently mirrors that of the disqualified counsel in Shelton, such that "no weight may counterbalance `the likelihood that the image of the legal profession will be somehow undermined or tarnished by the continuance of the relationship' between Plaintiffs and their attorney." This argument overstates the facts, the significance of the facts and the similarity of this dispute to the one found in Shelton.
D's Mot. to Disqualify, at 7 (quoting Shelton, 599 F. Supp. at 909). Neither party provided pagination to the briefing on the Motion to Disqualify, and therefore the Court has on its own assigned page numbers in logical sequence.
In Shelton the offending, and later disqualified, attorney met in secret with an individual representative of a defendant entity, after which plaintiff dismissed all punitive claims against that individual and the individual, with help from the offending attorney, filed for notice of substitution of counsel. Ultimately, the offending attorney persuaded the individual to release his original counsel and accept the offending attorney as counsel, thereby ensuring counsel's place on both sides of the dispute. The Court, quite reasonably, found this conduct to violate the ethical rules in question and to merit disqualification, despite an interruption in representation and litigation.
Shelton, 599 F. Supp. at 907-08, 910.
Id. at 910.
See id.
Here, no such egregious conduct occurred. Rather, Greenwald appeared in a public forum after public notice of the hearing and discussed the CBA as well as the litigation in the presence of the City Council and the City's counsel. Everything of which Defendant complains occurred in a public forum while defense counsel was present. Therefore, the Court finds that there is here, unlike in Shelton, no risk whatsoever of public suspicion, let alone public suspicion sufficient to outweigh the interest in permitting Greenwald to continue to represent his clients.
Plaintiffs claim that Greenwald's conduct is protected under the First Amendment and under the Texas Open Meetings Act. Because the Court finds that Defendant failed to carry its burden in showing that disqualification is the proper remedy and failed to show that public suspicion outweighs the interest of allowing counsel to continue in his representation, the Court declines to evaluate Plaintiffs' independent claims of legal justification for Greenwald's conduct.
TEX. GOV'T CODE ANN. § 551.002 (Vernon 1994).
The Court finds no reason to further bolster its decision with supplemental analysis, given that an order declining disqualification in a civil case is not sufficiently final in effect to trigger appellate review. See Gibbs v. Paluk, 742 F.2d 181 (5th Cir. 1984). Therefore further analysis of Plaintiffs' independent claims would not serve to aid the Court of Appeals.
The Court is hopeful that the resolution of the matter of disqualification will permit the parties and their counsel to proceed, as previously ordered by this Court, onto the substantive legal disputes at issue. The Court eagerly anticipates the parties' presentation of a cohesive plan for discovery and litigation of the cause of action. Therefore, the Court will also order a hearing on that topic, as previously referenced in the Order dated December 3, 2003.
Conclusion
Based upon the foregoing, it is hereby ORDERED that Defendant's Motion to Disqualify (Docket No. 94) is DENIED.
It is further ORDERED that the parties APPEAR for a hearing on all pending discovery motions and discovery in general on January 6, 2004 at 10:30am.