Judge: Maurice A. Leiter, Case: 20STCV04582, Date: 2022-12-08 Tentative Ruling

Case Number: 20STCV04582    Hearing Date: December 8, 2022    Dept: 54

Hearing Date: December 8, 2022

Department 54, Judge Maurice Leiter

Motion to Disqualify Counsel

Moving Party: Plaintiff George Sharp

Responding Party: Defendant Dana Stead  

T/R:     PLAINTIFF’S MOTION TO DISQUALITY COUNSEL IS DENIED.

PLAINTIFF TO NOTICE.

If the parties wish to submit on the tentative, please email the courtroom at¿SMCdept54@lacourt.org¿with notice to opposing counsel (or self-represented party) before 8:00 am on the day of the hearing. 

The Court considers the moving papers, opposition, reply, and supplemental filings. 

BACKGROUND

On February 24, 2020, Plaintiff George Sharp sued Defendants Santa Anita Park, The Stronach Group, Los Angeles Turf Club, Inc., and Los Angeles Turf Club II, Inc. On October 16, 2020, Plaintiff filed a second amended complaint, in part adding Dr. Dana Stead as a defendant. Plaintiff filed the operative fourth amended complaint on November 2, 2022, asserting causes of action for (1) breach of contract; (2) breach of implied covenant of good faith and fair dealing; (3) violation of Bus. & Prof. Code § 17200; and (4) negligence.

Plaintiff alleges that Defendants improperly “scratched” Plaintiff’s horse, League of Shadows, before the January 18, 2020 California Cup Sprint race. Plaintiff alleges the racing veterinarian, Dr. Stead, did not perform an examination in conformity with CHRB rules before recommending to the steward that Shadows be scratched. The steward ultimately decided to scratch Shadows. 

The second amended complaint identified two veterinarians, Dr. Cathy Canfield and Dr. Sarah Jones, who allegedly examined Shadows immediately after being scratched and gave their independent opinions that Shadows was sound and fit to race. Dr. Canfield and Dr. Jones also were identified as relevant witnesses in discovery responses on March 9, 2021, and they were included on the joint witness list filed October 28, 2022. On November 2, 2022, Defendant Stead’s counsel, George Wallace, of the law firm Wallace, Brown & Schwartz, told Plaintiff that his law firm had a current attorney-client relationship with Dr. Canfield and Dr. Jones. Lisa A. Brown, a partner at the firm, represents Dr. Canfield and Dr. Jones in a matter with the Veterinary Medical Board.

Dr. Canfield and Dr. Jones reached out to Ms. Brown concerning their trial subpoenas; “Ms. Brown put them in contact with Mr. Wallace, defense counsel in this case, to contact plaintiff’s counsel to obtain an ‘on call’ agreement, or otherwise to facilitate the doctors’ appearances to testify in a manner that would minimize the burden on them.” (Opposition to Motion to Disqualify, p. 6:10-13.) The relationship between the firm Wallace, Brown & Schwartz and Dr. Canfield and Dr. Jones has given rise to this motion to disqualify counsel.

ANALYSIS

            “A trial court's authority to disqualify an attorney derives from the power inherent in every court ‘[t]o control in furtherance of justice, the conduct of its ministerial officers, and of all other persons in any manner connected with a judicial proceeding before it, in every matter pertaining thereto.’ [Citations.]” (People ex rel. Dept. of Corporations v. SpeeDee Oil Change Systems, Inc. (1999) 20 Cal.4th 1135, 1145 citing Code Civ. Proc., § 128, subd. (a)(5).) 

“Disqualification motions involve a conflict between the clients' right to counsel of their choice and the need to maintain ethical standards of professional responsibility. [Citation.] The paramount concern must be to preserve public trust in the scrupulous administration of justice and the integrity of the bar. The important right to counsel of one's choice must yield to ethical considerations that affect the fundamental principles of our judicial process. [Citations.]” (SpeeDee Oil Change, supra, at pp. 1145–1146.)

            A “standing” requirement is implicit in disqualification motions. Generally, before the disqualification of an attorney is proper, the complaining party must have or must have had an attorney-client relationship with that attorney. (Great Lakes Construction, Inc., supra,186 Cal.App.4th at p. 1356.) If there is no attorney-client relationship, a court is limited to exercising their inherent authority under Code Civ. Proc., § 128(a)(5) to when the misconduct “will have a continuing effect on the judicial proceedings. [Citation.] If a court's purpose is merely to punish a transgression which has no substantial continuing effect on the judicial proceedings, neither the court's inherent power to control its proceedings nor Code of Civil Procedure section 128 can be stretched to support the disqualification. [Citation.]” (Internal quotations omitted.) (In re Marriage of Murchison (2016) 245 Cal.App.4th 847, 852–853.)

A.    Standing of Plaintiff George Sharp

            Plaintiff moves to disqualify Defendant Stead’s counsel based on an attorney-client relationship between counsel and Dr. Canfield and Dr. Jones, under the court’s inherent authority in Code Civ. Proc., § 128(a)(5). Plaintiff brings this motion as an allegedly harmed third party of a violation of California Rules of Professional Conduct Rule 1.7.

            Because Plaintiff does not move on behalf of his own attorney-client relationship, Plaintiff must demonstrate that “the misconduct will have a continuing effect on the judicial proceedings.” (In re Marriage of Murchison (2016) 245 Cal.App.4th 847, 852–853.)

B. Continuing Effect on Judicial Proceedings

The facts here are like those in Hernandez v. Paicius (2003) 109 Cal.App.4th 452, 464 disapproved on separate grounds by People v. Freeman (2010) 47 Cal.4th 993. In Hernandez, Plaintiff’s expert witness was represented in other matters by the same law firm that represented the defendant in the matter at issue. (Ibid.) Defense counsel represented the expert witness “in certain medical malpractice” actions and “in an ongoing disciplinary proceeding regarding the physician's license to practice medicine.” (Id. at 455.) The Court of Appeal found “an egregious and shocking breach of her duty of loyalty” when defense counsel cross-examined the expert witness and “create[ed] a record impeaching her other client's professional reputation and credibility.” The court stated that the superior court “should have avoided the unseemly inquisition to which [Plaintiff’s expert witness] was subjected by declaring a mistrial.” (Ibid.)

            The same duty of loyalty issue is present here. Dr. Canfield and Dr. Jones will be called by Plaintiff and will testify that, based on their examinations, Shadows was sound and fit to race. This conflicts with Defendant Stead’s position that Shadows was not fit to race. Defendant Stead’s counsel, Wallace, concedes that Plaintiff will argue that the findings by Dr. Canfield and Dr. Jones show Defendant Stead was negligent in recommending that Shadows be scratched. If Wallace cross-examines Dr. Canfield and Dr. Jones to challenge their credibility, or their recollection, or their training and experience, or the adequacy of their examinations, he may violate his duty of loyalty to them, as clients of his firm. Any cross-examination would require the same “record impeaching her other client's professional reputation and credibility” as in Hernandez. (Ibid.) If Wallace foregoes cross-examining them, he may violate his duty of loyalty to Defendant Stead, and potentially undermine his duty to vigorously defend Defendant Stead. Wallace’s argument that the expected testimony of Drs. Canfield and Jones is “uncontroversial” percipient testimony is unpersuasive.

In opposing this motion, Wallace proposed to resolve the problem by not cross-examining Dr. Canfield and Dr. Jones or by stipulating to their testimony. As the Court wrote in its original tentative ruling to grant this motion to disqualify:

Missing from this offer is any evidence that Defendant Stead is aware of and consents to the conflict and counsel’s proposal not to cross-examine witnesses who undercut his defense. “When a client engages the services of a lawyer in a given piece of business he is entitled to feel that, until that business is finally disposed of in some manner, he has the undivided loyalty of the one upon whom he looks as his advocate and his champion. The feeling of loyalty is necessarily destroyed if the lawyer accepts representation hostile to his client's interests.” (Internal quotations omitted.) (Hernandez v. Paicius, supra, 109 Cal.App.4th at p. 465.) As the California Supreme Court has stated, “A client who learns that his or her lawyer is also representing a litigation adversary, even with respect to a matter wholly unrelated to the one for which counsel was retained, cannot long be expected to sustain the level of confidence and trust in counsel that is one of the foundations of the professional relationship.” (Flatt v. Superior Court (1994) 9 Cal.4th 275, 285.) “The paramount concern must be to preserve public trust in the scrupulous administration of justice and the integrity of the bar.” (Kennedy v. Eldridge (2011) 201 Cal.App.4th 1197, 1204.) The perceived lack of loyalty in Wallace’s representing two of Plaintiff’s witnesses against Defendant Stead, and in not challenging their adverse testimony, undermines public trust.

(December 1, 2022 Tentative Ruling at 4.)

            At oral argument on December 2, Wallace represented that he had spoken with Defendant Stead, and Defendant Stead fully understood the issue, wished to keep Wallace as his counsel, and consented to Wallace’s plan not to cross-examine Drs. Canfield and Jones. Wallace also argued that counsel for other Defendants would have the opportunity to cross-examine those witnesses. The Court continued the hearing to allow Defendant Stead to file a sworn declaration as to his knowledge and consent, and for the parties to present any further case law on this issue.

            In his declaration, filed on December 6, Defendant Stead states he read the Court’s earlier tentative ruling and discussed it at length with Wallace. He declares that he waives any conflict and wishes to proceed to trial with Wallace as his lawyer. He states he has “no objection” to Wallace’s “proposal to forego or to limit his questioning of Dr. Jones and Dr. Canfield,” because “any necessary cross-examination will be handled fully and capably by [counsel for co-Defendants.]” (Stead Declaration ¶¶ 3-4.)

            Hernandez discusses whether a client may agree to proceed notwithstanding counsel’s conflict:

Our disposition of this issue should not be construed as suggesting that disqualification of counsel is the appropriate remedy in all cases in which one party's attorney represents an expert designated by the other side. A party's right to select counsel of his or her own choosing may trump the opposing party's freedom to choose an expert whose designation creates a conflict. And while we know Aengst was a percipient treating physician as well as a designated expert, the facts developed at trial as to how and when the problem surfaced are not sufficiently clear to allow us to formulate a rule of general application.

(Hernandez, supra, 109 Cal. App. 4^th at 467-68.)

            The Court finds that Defendant Stead is now aware of counsel’s conflict and has made an informed choice to retain Wallace as his counsel. Defendant Stead also has agreed to Wallace’s plan not to cross-examine Drs. Canfield and Jones. By foregoing such cross-examination Wallace would not be in a position to undermine his duty of loyalty to Drs. Canfield and Jones. And Defendant Stead is prepared to proceed to trial with Wallace as his lawyer, understanding that his lawyer will not cross-examine two witnesses who will testify adversely to him. In these circumstances, the Court will not deprive Defendant Stead of counsel of his choosing.

            Plaintiff’s Motion to Disqualify Counsel is DENIED.