ALLIED RLTY. OF ST. PAUL, INC. v. EXCH. NAT. BANK OF CHI., 19311

• Decision Date: 26 March 1969
• Docket Number: 19321.,No. 19311,19311
• Citation: 408 F.2d 1099
• Parties: ALLIED REALTY OF ST. PAUL, INC., Plaintiff, v. EXCHANGE NATIONAL BANK OF CHICAGO et al., Defendants-Appellees, Sidney P. Abramson, Intervenor-Appellant. EXCHANGE NATIONAL BANK OF CHICAGO, Defendant-Appellant, v. ALLIED REALTY OF ST. PAUL, INC., Plaintiff, Sidney P. Abramson, Intervenor-Appellee.
• Court: U.S. Court of Appeals — Eighth Circuit

408 F.2d 1099 (1969)

ALLIED REALTY OF ST. PAUL, INC., Plaintiff, v. EXCHANGE NATIONAL BANK OF CHICAGO et al., Defendants-Appellees, Sidney P. Abramson, Intervenor-Appellant.

EXCHANGE NATIONAL BANK OF CHICAGO, Defendant-Appellant, v. ALLIED REALTY OF ST. PAUL, INC., Plaintiff, Sidney P. Abramson, Intervenor-Appellee.

Nos. 19311, 19321.

United States Court of Appeals Eighth Circuit.

March 26, 1969.

Theodore J. Collins, of O'Connor, Collins & Abramson, St. Paul, Minn., for Sidney P. Abramson.

David C. Forsberg, of Briggs & Morgan, St. Paul, Minn., for Allied Realty of St. Paul.

Edgar Bernhard, of D'Ancona, Pflaum, Wyatt & Riskind, Chicago, Ill., for Exchange Nat. Bank of Chicago, Harold C. Evarts, of Best, Flanagan, Lewis, Simonet & Bellows, Minneapolis, Minn., on the brief.

Before VAN OOSTERHOUT, Chief Judge, and MATTHES and BRIGHT, Circuit Judges.

VAN OOSTERHOUT, Chief Judge.

This is an appeal by intervenor Sidney P. Abramson from final order determining that Mr. Abramson is disqualified by reason of Canon 36 of the American Bar Association Canons of Professional Ethics from serving as an attorney for the plaintiff in Allied Realty of St. Paul v. The Exchange National Bank of Chicago, et al., pending in the trial court. Plaintiff has not appealed from the disqualification order. Defendants have cross-appealed from the refusal of the trial court to extend the disqualification order to enjoin the use by the plaintiff of information obtained and services performed by Mr. Abramson and the refusal to extend the disqualification to other attorneys representing the plaintiff.

The trial court in a memorandum opinion supporting its order, reported at 283 F.Supp. 464, fully and fairly states the issues, the pertinent facts and the basis of its decision. We affirm the trial court's decision both upon the appeal and the cross-appeal for the reasons hereinafter stated.

A brief summary of the extensive background facts appears to be necessary to put the issues before us in proper focus. Plaintiff Allied Realty brought this action to set aside as fraudulent a mortgage it had given to the defendant bank. Such action has been pending since 1965 and was commenced prior to Mr. Abramson's appointment as attorney for the plaintiff. Plaintiff is a wholly owned subsidiary of American Allied Insurance Company. In 1965 the Minnesota federal grand jury returned an indictment against numerous individuals including three former employees of defendant bank for alleged criminal activity which brought about the failure and insolvency of Allied Insurance Company. Upon change of venue, the indictment was prosecuted in North Dakota. After a trial of thirteen weeks, all defendants were acquitted. Abramson, who had previously served as assistant United States Attorney, accepted employment as a Special Assistant United States Attorney to assist in the preparation and trial of the criminal case and actively participated in the investigation and the trial. The trial court upon the basis of a transcript of a portion of the record of the criminal trial, which was introduced in evidence, found:

"These pages indicate that the government in the criminal trial attempted to show, through a series of exhibits, the mortgage transaction involving the Minnesota real estate, the subject of the present case. Neither the Receiver nor Abramson argue that this mortgage is not the same mortgage as the one involved in this case nor that such evidence was not adduced in the criminal trial. Abramson in fact reviewed many documents with officers of defendant Bank in preparation for trial, including the aforesaid mortgage documents.

"Abramson does not contend that he did not marshal the documents relevant to the Minnesota mortgage transaction. Indeed, his statement which is very frank that he saw every Bank document put in evidence, coupled with the transcript showing Bank records being introduced, compels the conclusion that Abramson passed upon them with more than a mere summary perusal. Additionally, Abramson questioned Bank employees and participated in numerous pretrial procedures." 283 F.Supp. 464, 467.

As the trial court's opinion shows, Mr. Abramson was appointed as an additional attorney for the plaintiff with the approval of the state court administering the receivership largely on the basis of relevant knowledge he had acquired in the criminal case. He subsequently caused an amendment to the complaint to be filed which was stated to be based on information available from the criminal case previously unknown to the plaintiff.

The American Bar Association Code of Ethics has been adopted by the Supreme Court of Minnesota as a standard of professional conduct. Mr. Abramson spends considerable space in his brief to establish that he did not violate Canon 6 (conflicting interests) and Canon 37 (confidential information). There is no claim made in the present litigation that either of such canons was violated. Canon 36, the canon upon which the court based Mr. Abramson's disqualification, reads:

"A lawyer, having once held public office or having been in the public employ, should not after his retirement accept employment in connection with any matter which he has investigated or passed upon while in such office or employ."

The trial court in its opinion has clearly and convincingly demonstrated that Mr. Abramson's representation of the plaintiff in the present case is proscribed by Canon 36. Although Mr. Abramson's services as a government attorney had been completed and terminated prior to his employment as an additional attorney by plaintiff, he clearly falls in the category of having been in government...