Koller By and Through Koller v. Richardson-Merrell, Inc.

• Citation: 737 F.2d 1038
• Decision Date: 15 October 1984
• Docket Number: RICHARDSON-MERRELL,No. 84-5039,84-5039
• Parties: Anne Elisabeth KOLLER, an infant, By and Through John Lamont KOLLER and Cynthia Anne Koller, her natural guardians, et al. James G. Butler, Nicholas R. Allis and the law firm of Butler, Jefferson, Dan & Allis, Appellants, v.INC., a Delaware Corporation.
• Court: United States Courts of Appeals. United States Court of Appeals (District of Columbia)

Page 1038

737 F.2d 1038

237 U.S.App.D.C. 333

Anne Elisabeth KOLLER, an infant, By and Through John Lamont KOLLER and Cynthia Anne Koller, her natural guardians, et al. James G. Butler, Nicholas R. Allis and the law firm of Butler, Jefferson, Dan & Allis, Appellants, v. RICHARDSON-MERRELL INC., a Delaware Corporation.

No. 84-5039.

United States Court of Appeals District of Columbia Circuit.

Argued March 22, 1984.

Decided May 29, 1984.

As Amended July 16, 1984.

Certiorari Granted Oct. 15, 1984.

See 105 S. Ct. 290.

Jacob A. Stein, Washington, D.C., with whom Robert Muse and Robert M. Weinberg, Washington, D.C., were on the brief, for appellants.

Lawrence E. Walsh, Oklahoma City, Okl., with whom Richard C. Ford, Oklahoma City, Okl., Guy M. Struve, Whitney L. Schmidt, New York City, Vincent H. Cohen and Robert B. Cave, Washington, D.C., were on the brief, for appellee, Richardson-Merrell Inc.

Boisfeuillet Jones, Jr. and Carol D. Melamed, Washington, D.C., were on the brief for amicus curiae, Washington Post Company, urging reversal.

Anthony Z. Roisman, Washington, D.C., was on the brief for amicus curiae, Trial Lawyers for Public Justice, urging reversal.

Stephen H. Glickman and Arthur B. Spitzer, Washington, D.C., were on the brief for amicus curiae, American Civil Liberties Union Fund of the National Capitol Area, urging reversal.

Barry J. Nace, Washington, D.C., entered an appearance for amicus curiae, Association of Plaintiff's Trial Attorneys of Metropolitan Washington, D.C., urging reversal.

Before WALD and MIKVA, Circuit Judges, and RICHEY, ^* United States District Judge for the District of Columbia.

Opinion for the Court filed by Circuit Judge WALD.

Concurring opinion filed by District Judge CHARLES R. RICHEY.

WALD, Circuit Judge:

This appeal arises out of a lawsuit filed in May, 1980, in which plaintiffs Cynthia and John Koller and their daughter Anne Elizabeth Koller allege that Mrs. Koller's ingestion during the first trimester of her pregnancy of the anti-nausea drug Bendectin, which is manufactured by the defendant, caused the severe limb malformations with which her daughter was born. Shortly before trial was to begin, two separate episodes gave rise to allegations of misconduct against plaintiffs' counsel and a motion by the defendant to impose sanctions against them. Following extensive discovery and hearings, the district court in its ruling of January 6, 1984, revoked the pro hac vice appearances of Nicholas Allis and James Butler and disqualified their firm, Butler, Jefferson, Dan & Allis, from further representation of the plaintiffs. ¹ The court held that Allis had attempted to "thwart a true investigation of a crucial witness" by obtaining a statement from his (Allis') secretary declaring that representatives of the defendant were pressuring her to sign a false statement that the Koller case was a fraud. The court also determined that Butler, in an unrelated episode, had deliberately circumvented the court's pretrial evidentiary rulings when he released to Morton Mintz, a Washington Post reporter, information that had recently been ruled inadmissible at trial on the alleged connection between Bendectin and the congenital deformities of fourteen infants. Allis, Butler, their law firm and the plaintiffs appeal from the district court's order. ²

We must determine first whether we have jurisdiction to review this interlocutory order in light of the Supreme Court's recent decision in Flanagan v. United States, --- U.S. ----, 104 S.Ct. 1051, 79 L.Ed.2d 288 (1984), holding that there was no jurisdiction to entertain an interlocutory appeal by defendants in a criminal case of an order disqualifying their counsel. We conclude that an order disqualifying counsel in a civil proceeding, at least in the circumstances present here, is immediately reviewable. We conclude on the merits that the district court erred in revoking the pro hac vice appearances of Allis and Butler and in disqualifying the Butler firm. We therefore reverse and remand with instructions to reinstate the pro hac vice appearances of plaintiffs' counsel.

I. BACKGROUND

In May, 1980, plaintiffs filed suit in federal district court alleging that Anne Koller had been born without arms and legs because her mother, Cynthia, had taken Bendectin, an anti-nausea drug manufactured by the defendant, Richardson-Merrell, ³ during the first trimester of her pregnancy. In January, 1981, plaintiffs retained the law firm of Butler, Jefferson, Dan & Allis to represent them in the litigation. James Butler and Nicholas Allis were admitted pro hac vice to appear in the case. ⁴ Two key issues that emerged during pretrial discovery were whether Mrs. Koller had in fact taken Bendectin during the critical first three months of her pregnancy ⁵ and whether Bendectin was a teratogen--i.e., a substance that causes birth defects. After two-and-a-half years of pretrial discovery and preparation, the events described below brought a virtual halt to proceedings on the merits.

A. The Janowski Episode ⁶

On the evening of Sunday, December 26, 1982, Richard Daum, a paralegal with the Butler firm, notified Allis that he had just received a telephone call from Krystyna Janowski, Allis' secretary. According to Daum, Janowski had told him that she was being threatened and bribed by George Barnes, an investigator employed by defendant's law firm, Davis, Polk & Wardwell, to induce her to sign a false statement to the effect that Cynthia Koller had not taken Bendectin in the first trimester of her pregnancy. ⁷

The following day Allis decided, with other members of the Butler firm, to talk with Janowski. After a brief telephone conversation with Janowski, Allis went to meet her at the hospital where she was tending to her own prematurely-born infant. There she repeated in greater detail what she had said the previous evening: that the defendant, through its investigator Barnes, was pressuring her to sign what she said was a false statement that Mrs. Koller had admitted to Janowski that she had not taken Bendectin until after the first trimester of her pregnancy; that this pressure was in the form of promises to take care of her "wants and needs" and her child's medical expenses, and threats to reveal her criminal record; that in fact she had never had any such conversation with Mrs. Koller. ⁸ Although Janowski seems to have admitted during this conversation that she had called Davis, Polk at some point, she insisted that it was only at the instigation of the defendant and denied saying anything about the Koller case being fraudulent. ⁹ Janowski indicated to Allis her willingness to sign a statement confirming these events. ¹⁰

That evening Allis and Humphries, an investigator employed by the firm, went to Janowski's apartment with a short written statement for Janowski to review and sign. They recorded the conversation with a small concealed tape recorder. The transcripts of the tape ¹¹ reflect that during the conversation Janowski once again repeated the story she had related to Allis earlier that defendants were trying to induce her to sign a false statement about Mrs. Koller, and she confirmed her willingness at that time to sign a statement for Allis describing those inducements. ¹² She took the statement produced by Allis, made minor corrections and a few comments confirming its accuracy, and signed it. At Allis' suggestion she wrote at the bottom of the statement, "Under penalty of perjury, I swear that the above typed statement is true and correct." The statement reads as follows:

Last week I was in a state of severe agitation and depression and felt a lot of hostility towards the law firm of Butler, Jefferson, Dan & Allis. Today I feel calm and my mind is free and clear. At no time did I ever hear Cynthia Koller or anyone else say that Cynthia Koller did not take Bendectin. George L. Barnes & Associates, Inc. had been trying to get me to sign a statement saying that I heard Cynthia Koller say that she did not take Bendectin. Such a statement would be false and I would not sign such a statement for that reason. Mr. Barnes and others have promised that if I signed such a statement they would be able to relocate me and would take care of all my wants and needs including renting a comfortable apartment for me and by [sic] baby. Any conversation I had with George Barnes, Patrick Ryan or any other person from Davis Polk & Wardwell or George Barnes & Associates was at a time when I was extremely upset and under great emotional stress. At the present time my mind is free and clear and everything in this statement is true and correct. I have been promised no remuneration of any kind by any representative of Butler, Jefferson, Dan & Allis for stating these true statements or for anything else.

J.A. 1504 (emphasis in original). Janowski also gave Allis a statement in her handwriting describing the conversation that she said defendants wanted her to "recall" and swear to. ¹³ She indicated that she would be willing to make a longer, more detailed statement in the immediate future. She also suggested that she might go to Mexico to get away from the pressures she was under. Finally, Allis discussed with Janowski the possibility of bringing a typewriter to her apartment to allow her to work at home. ¹⁴

On the following day, December 28, 1982, the Butler firm received a copy of a letter which Davis, Polk had sent to the court. ¹⁵ The letter stated that Davis, Polk had received two calls on December 22 from a woman identifying herself as Allis' secretary and stating that the Koller case was fraudulent. The next day defense counsel had called the court to attempt to set up a conference before Christmas. (In oral argument we learned that in this December 23 call, made several days before the defense first contacted plaintiffs' counsel, defense counsel also told the court's law clerk the substance of Janowski's call.) The letter continued; after identifying the...