Robert M. Steptoe, Jr.
Rodney L. Bean Robert J. Schiavoni
Steptoe & Johnson Hammer, Ferretti & Schiavoni
Clarksburg, West Virginia Martinsburg, West Virginia
Attorneys for the Petitioner and
Pyles & Auvil
Parkerburg, West Virginia
Attorneys for the Respondent,
Richard W. Shaffer
The Opinion of the Court was delivered PER CURIAM.
CHIEF JUSTICE DAVIS and JUSTICE MAYNARD concur, in part, and dissent, in part, and reserve the right to file separate opinions.
JUSTICE STARCHER concurs and reserves the right to file a concurring opinion.
1. In determining whether to grant a rule
to show cause in prohibition when a court is not acting in excess of its jurisdiction,
this Court will look to the adequacy of other available remedies such as appeal
and to the over-all economy of effort and money among litigants, lawyers and
courts; however, this Court will use prohibition in this discretionary way
to correct only substantial, clear-cut, legal errors plainly in contravention
of a clear statutory, constitutional, or common law mandate which may be resolved
independently of any disputed facts and only in cases where there is a high
probability that the trial will be completely reversed if the error is not
corrected in advance. Syl. Pt. 1, Hinkle v. Black, 164 W.Va.
112, 262 S.E.2d 744 (1979).
2 Under Rule 1.9(a) of the Rules of Professional
Conduct, determining whether an attorney's current representation involves
a substantially related matter to that of a former client requires an analysis
of the facts, circumstances, and the legal issues of the two representations.
Syl. Pt. 3, State ex rel. McClanahan v. Hamilton, 189 W.Va. 290, 430
S.E.2d 569 (1993).
The petitioner/defendant below, Ogden Newspapers,
Inc., doing business as The Journal Publishing Company (hereinafter Ogden),
has invoked the original jurisdiction of this Court
(See footnote 1) by seeking a writ of prohibition
against respondent, the Honorable Christopher C. Wilkes, Judge of the Circuit
Court of Berkeley County, and respondent/plaintiff below, Richard W. Shaffer
(hereinafter Shaffer). Ogden is seeking specifically to prohibit
the circuit court from enforcing its order entered January 5, 2001, which
denied Ogden's motion to disqualify David M. Hammer and Robert J. Schiavoni
(hereinafter Hammer and Schiavoni), of the law firm Hammer, Ferretti
& Schiavoni, and Walt Auvil (hereinafter Auvil), of the law
firm Pyles & Auvil, from representing Shaffer in his case against Ogden
alleging improper employment practices. Ogden argues that the effect of the
lower court's order is to allow Hammer and Schiavoni to represent a party
with interests adverse to those of Ogden in matters substantially related
to work the attorneys had done for Ogden while they were associates at the
law firm of Steptoe & Johnson. Ogden claims that the lower court's order
violates Rule 1.9 of the Rules of Professional Conduct (hereinafter Rule
1.9) and disregards this Court's previous holding in State ex rel.
Ogden Newspapers, Inc. v. Wilkes, 198 W.Va. 587, 482 S.E.2d 204 (1996)
(hereinafter Ogden I), which involved an employment discrimination
case from which both Hammer and Schiavoni were disqualified. Ogden further
argues that if Hammer and Schiavoni are disqualified under the provisions of Rule 1.9,
then Auvil's association as co-counsel with Hammer and Schiavoni in the Shaffer
case raises the presumption that Auvil received confidential information related
to Ogden and as a consequence also should be disqualified according to the
provisions of Rule 1.10 of the professional conduct rules. Having determined
that mandatory disqualification of counsel pursuant to Rule 1.9 is not warranted
in this case, the rule to show cause is discharged and the writ prayed for
The law firm of Steptoe & Johnson is representing Ogden in the Shaffer suit. Steptoe & Johnson has provided legal representation to Ogden for over thirty years, including the periods when Hammer and Schiavoni worked for the firm as associates. (See footnote 4) Based on this prior association with Steptoe & Johnson, Ogden filed a motion to disqualify Hammer and Schiavoni from the Shaffer suit; the motion also sought to disqualify Auvil on the basis that his affiliation with Hammer and Schiavoni raised a presumption that he was the recipient of confidential information about Ogden. The lower court denied the motion for disqualification by order entered January 5, 2001.
Disqualification of an attorney based on conflict
of interest with a former client is governed by Rule 1.9 of the West Virginia
Rules of Professional Conduct which states:
A lawyer who has formerly represented a client in a matter shall not thereafter:
(a) represent another person in the same or substantially related matter in which that person's interest [sic] are materially adverse to the interests of the former client unless the former client consents after consultation; or
(b) use information relating to the representation to the disadvantage of the former client except as Rule 1.6 or Rule 3.3 would permit or require with respect to a client or when the information has become generally known.
In syllabus point three of State ex rel. McClanahan v. Hamilton, 189 W.Va. 290, 430 S.E.2d 569 (1993), we explained that [u]nder Rule 1.9(a) of the Rules of Professional Conduct, determining whether an attorney's current representation involves a substantially related matter to that of a former client requires an analysis of the facts, circumstances, and legal issues of the two representations. Id. at 291, 430 S.E.2d at 570. In State ex rel. DeFrances v. Bedell, 191 W.Va. 513, 446 S.E.2d 906 (1994), we recognized that such a detailed comparative analysis is necessarily conducted on a case-by-case basis: The determination of the existence of an attorney-client relationship depends on each cases's specific facts and circumstances. Id. at 517, 446 S.E.2d 910. The conclusion in Ogden I was based on the facts then under review, that is, Hammer and Schiavoni were disqualified from representing a specific client (Robin Wilkinson) in her specific handicap discrimination case against Ogden and was clearly limited to those specific facts. See, 198 W.Va. at 593, 482 S.E.2d at 210. Accordingly, we do not find that the lower court's order in this case denying the disqualification motion represented a disregard of the relevant ruling of this Court in Ogden I.
We now undertake our examination of the facts,
circumstances, and legal issues specific to the Shaffer case in order
to determine if disqualification is required under Rule 1.9, as urged by Ogden, because a substantial relationship between
the matters in the two representations exists. McClanahan, 189 W.Va.
at 291, 430 S.E.2d at 570. Under the provisions of Rule 1.9 and our rulings
regarding the same, the burden of establishing that a substantially related
matter exists is on the former client. Once it is established that the matters
are substantially related, the court will presume that confidential information
was divulged during the earlier representation, thereby avoiding disclosure
of the very information which is to be protected. See, Syl. Pt. 4,
McClanahan, 189 W.Va. at 291, 430 S.E.2d at 570. We recently added
further definition to the substantial relationship test in syllabus point
one of State ex rel. Keenan v. Hatcher, 210 W.Va. 307, 557 S.E.2d 361
(2001), when we adopted the approach taken in § 132 Restatement (Third)
of the Law Governing Lawyers and said that two matters are substantially related
under Rule 1.9(a) if there is a substantial risk that representation
of the present client will involve the use of [confidential] information acquired
in the course of representing the former client, unless that information has
become generally known. The express language of section (b) of Rule
1.9 likewise acknowledges that information which is or becomes commonly known
lies outside the parameters of confidential information and may be used against
a former client in subsequent actions.
In addition to the petition, briefs
(See footnote 5) and arguments of the parties,
we have before us documentary evidence, submitted under seal, of the type of
legal work performed by Hammer and Schiavoni for Ogden while associates at Steptoe
(See footnote 6) Our study involves an analysis of these documents
with due regard to the lower court's reasons for denying the disqualification
motion as set forth in its January 5, 2001, order. In summary, the lower court's
decision that a substantial relationship between the two representations did
not exist was based on: the dissimilar relationship between the facts in either
instance; dramatic changes in the relevant law; Ogden's acquiescence
to Hammer and Schiavoni's representation of clients adverse to Ogden in other
cases grounded in Human Rights Act and other West Virginia laws;
the ongoing relationship Shaffer has had with Hammer and Schiavoni as legal
counsel; and the passage of nine years since Hammer and Schiavoni represented
footnote 7) We note with particular interest that the common thread running through the
reasoning which underpins the decision of the lower court is the change in
circumstances which has occurred since Hammer and Schiavoni last represented
Ogden in 1992.
Changes occurring during the interval between earlier
and later representations is not a matter specifically addressed in Rule 1.9
or its commentary. However, as observed by one authority addressing the passage
of time with regard to the substantial relationship question,
[t]reating all former representations equally . . . clearly threatens over-inclusive application of the substantial relationship standard because we can be fully confident in some instances that the presumed threat of disclosure of material and confidential information gained in that representation is factually unfounded.
. . . [E]ven if facts are remembered with acute and
abundant detail (perhaps because they are contained in surviving documents),
the passage of time often will decrease or destroy the relevance of those facts
in the latter representation. Intervening happenings and other facts will slowly
erode whatever salience might originally have attached even to the former client's
inner-most secrets. . . . [O]ld information may continue to be secret and thus
subject to a broad duty on the part of the lawyer not to reveal or use it adversely.
But if the old information is not realistically relevant to the later representation,
its presumed possession should not lead to a finding of substantial relationship
sufficient to bar the later representation.
Wolfram, Former-Client Conflicts, 10 Geo. J. Legal Ethics 677, 731-32 (1997) (footnotes omitted).
We further note that several courts have considered
the passage of time to be a relevant factor in determining whether a substantial
relationship exists between representations in the context of disqualification
motions. See, e.g., Schwartz v. Cortelloni, 685 N.E.2d 871 (Ill.
1997) (law firm's appearance in guardianship case forty years earlier for
purpose of selling real estate in which ward had one-sixth interest did not
entail disclosure of confidential information about unrelated property that
was subject of current partition action); State ex rel. Wal-Mart Stores,
Inc. v. Kortum, 559 N.W.2d 496 (Neb. 1997) (lapse of time between representations
is one of several factors a court may consider when determining existence
of substantial relationship); Phillips v. Haidet, 695 N.E.2d 292 (Ohio
Ct. App. 1997) (representation of former client seven years earlier in a personal
injury action did not form the basis for disqualification in a subsequent
defamation action when the medical and financial records of the former client were not useful to the later action);
Bennett Silvershein Assocs. v. Furman, 776 F.Supp. 800 (S.D.N.Y. 1991)
(matter disclosed by prospective client during brief consultation ten years
earlier not relevant to later adverse representation because most of the alleged
acts in the later case had not occurred at time consultation took place);
Westinghouse Elec. Corp. v. Kerr-McGee Corp., 580 F.2d 1311 (7th
Cir. 1978) (vaguely related representation occurring ten years earlier did
not warrant disqualification). We note with particular interest that, although
decided on the basis that a direct attorney-client relationship had not been
established, this Court found in State ex rel. DeFrances v. Bedell,
191 W.Va. 513, 446 S.E.2d 906 (1994), that a one-hour consultation with a
prospective estate planning client which had occurred several years earlier
was too remote, isolated, [and] non- productive to create a former
client conflict. Id. at 518, 446 S.E.2d at 911. Our decision in Ogden
I may well have been influenced by the short period of time which had
elapsed between the two representations then under consideration. The underlying
suit from which Hammer and Schiavoni were disqualified in Ogden I was
filed roughly two years after Respondents left Steptoe & Johnson.
Based upon the foregoing, we conclude that the passage
of time between representations is a relevant factor for a court to consider
when determining under Rule 1.9 of the Rules of Professional Conduct whether
a substantial relationship exists between an earlier representation of a client
and subsequent employment of a lawyer adverse to the interests of a former
client. We note, however, that the mere passage of time does not absolve attorneys from being faithful to the mandates of the legal profession regarding
the confidential treatment of information learned during the course of all
attorney-client relationships, nor does our decision today diminish the reviewing
courts responsibility to weigh and balance carefully all relevant factors
in order to guard against the risk of disclosure of confidential information
when addressing disqualification issues.
In the instant case, after considering the factual
and legal bases of the pending suit in relation to the evidence presented
regarding the former representation, we cannot construct a framework from
which it can be said that a substantial relationship exists between the matter
for which work was done at least nine years ago for Ogden by Hammer and/or
Schiavoni as associates with Steptoe & Johnson and the case now pending
before the circuit court. It is clear that neither Hammer nor Schiavoni represented
Ogden during the course of their representation in any employment discrimination
litigation. We do not find that the research which Respondents had performed
and the related brief consultations they then had with Ogden personnel are
realistically relevant to the pending case which was filed at least nine years
after the research and any related consultation with Ogden was completed.
Ogden nevertheless urges this Court to adopt a position that would, in essence, make the passage of time irrelevant. In reliance on Chugach Electric Association v. United States District Court, 370 F.2d 441 (9th Cir. 1966), Ogden asserts that the contact Hammer and Schiavoni had with Ogden personnel about employment issues allowed the attorneys to be exposed to a wide array of business information about specific company policies related to discrimination, lines of control and communication and methods of decision making which Ogden claims is privileged. In Chugach, a former general counsel to a corporation was disqualified on the premise that he had gained knowledge of private matters of general corporate affairs which gave him greater insight and understanding of the significance of subsequent events in an antitrust context and offer[ed] a promising source of discovery. Id. at 443. Observing that few courts today generally follow the broad-based, playbook rationale for disqualification announced in Chugach, one authority reasons that [p]ressed too far, the playbook rationale can give a former client an unjustifiably broad right to bar his or its former counsel from representing a later opponent; if 'insight' into intangibles is sufficient, it would be a rare case indeed that would not qualify. G.C. Hazard, Jr. & W.W.Hodes, 1 The Law of Lawyering: A Handbook on the Model Rules of Professional Conduct § 13.7 (3d ed. 2000). It also appears that the playbook rationale is not favored under our Rules of Professional Conduct, with the commentary following Rule 1.9 stating: [T]he fact that a lawyer has once served a client does not preclude the lawyer from using generally known information about the client when later representing another client. Id. Even those authorities which recognize the value of a playbook basis for disqualification limit the circumstances in which it is deemed applicable. See, e.g., 2 Restatement (Third) Law Governing Lawyers § 132 cmt. d(iii) (2000) (disqualification based on playbook information limited to situations in which the general information will be directly in issue or of an unusual value in the subsequent matter.).
We do not find that the circumstances of the present case warrant application of the Chugach reasoning, despite the contrary implication we may have given in Ogden I when we said:
The nature of the research project, as described in a confidential memorandum, clearly supports the presumption that Mr. Hammer gained some insight into the corporate policies of Ogden and its affiliates _ insight that would be substantially relevant to Hammer and Schiavoni's representation of Robin Wilkinson's handicap discrimination case against Ogden.
Ogden I, 198 W.Va. at 592-93, 482 S.E.2d at 209-10. As previously discussed, it is not until a substantial relationship is found as a result of a thorough comparison of the two representations at issue that disclosure of confidential information _ not insight into corporate policies _ is presumed. (See footnote 8)
Applying the Ogden I yardstick, we have meticulously
reviewed the sealed file in the current case. We judge the pending case to
be only generally similar to the earlier matters on which respondents were
consulted by Ogden. We therefore are unable to identify any information in
that file that will be directly in issue or of unusual value in the matter
now pending in the circuit court. This is so especially in light of the passage
of time, the extensive changes in the law over the intervening nine-year period
and the uniformly general and even hypothetical nature of the information to which respondents were exposed
in the earlier time frame.
In sum, as a result of our detailed and careful
study of the materials submitted, we do not find a substantial relationship
between the two representations which would trigger the presumption that relevant
confidential information was disclosed and disqualification is therefore warranted.
Vague general impressions associates may have gleaned about a client's philosophical
outlook, which is the most we can formulate from the situation at hand, is
not enough to warrant disqualification. Accordingly, we find that the circuit
court properly denied Ogden's motion to disqualify Hammer and Schiavoni, which
in turn removed the alleged Rule 1.10 basis for the imputed disqualification
of Auvil. Consequently, the petition before us for a writ of prohibition is
We stress that the result we have reached in this
case should in no way be read as an erosion of this Court's resolve to shield
the attorney-client relationship. We have simply recognized that a court faced
with a Rule 1.9 motion must consider all relevant factors on a case-by-case
basis in order to decide whether disqualification is warranted and that one
such factor may be the amount of time which has passed since the former representation
occurred. In some instances, no amount of time will remove the subsequent
representation prohibition. A lawyer's formidable ethical responsibility of
protecting the attorney-client relationship in a manner which steadfastly
guards against improper disclosure, misapplication or misuse of protected information obtained from a former client remains unaltered. The
frank and honest discourse which is the hallmark of the attorney-client relationship
can be preserved only if lawyers are faithful to selecting cases in a prudent
and judicious manner so as to protect the best interests of all clients.
2. The Court finds that
Messrs. Hammer and Schiavoni's prior representation of defendant is not substantially
related factually or legally to the instant case. The facts, as plead in the
Complaint, are not substantially related to any prior representation and the
law has changed so dramatically from 1991 until now that it too is not substantially related.
3. The Court further notes that defendant has not consistently asserted that attorneys Hammer and Schiavoni should be disqualified from representing clients adverse to defendant and its affiliates with regard to the Human Rights Act and other West Virginia laws. The Court is thus unwilling to deprive Mr. Shaffer of his chosen counsel with whom he had an ongoing relationship over the years under these circumstances.
4. The Court further finds that Rule 1.9(a) of the Rules of Professional Conduct does not require an absolute disqualification. Hammer and Schiavoni have not represented the Defendants in nine (9) years. The Court strongly relies on this nine (9) year passage of time in denying defendant's motion for disqualification.