Hepworth Holzer, LLP v. Fourth Judicial Dist. of State (In re in Recreational Ass'n, Inc.)

• Decision Date: 08 October 2021
• Docket Number: Docket No. 48766
• Citation: 169 Idaho 387,496 P.3d 873
• Court: Idaho Supreme Court
• Parties: HEPWORTH HOLZER, LLP, Petitioner, v. FOURTH JUDICIAL DISTRICT OF the STATE of Idaho; Honorable Lynn G. Norton, District Judge, Respondents, and Bogus Basin Recreational Association, Inc., Intervenor.

169 Idaho 387

496 P.3d 873

HEPWORTH HOLZER, LLP, Petitioner,

v. FOURTH JUDICIAL DISTRICT OF the STATE of Idaho; Honorable Lynn G. Norton, District Judge, Respondents,andBogus Basin Recreational Association, Inc., Intervenor.

Docket No. 48766

Supreme Court of Idaho, Boise, August 2021 Term.

Filed: October 8, 2021

Hepworth Holzer, LLP, Boise, attorneys for Petitioner. John Janis argued.

Lawrence G. Wasden, Idaho Attorney General, Boise, attorney for Respondents Fourth Judicial District and Judge Norton. Christine Salmi argued.

Elam & Burke, P.A., Boise, attorneys for Intervenor, Bogus Basin. Joseph Pirtle argued.

BEVAN, Chief Justice.

The law firm Hepworth Holzer, LLP ("Hepworth Holzer" or "the firm"), petitions this Court for a writ of mandamus or prohibition, seeking relief from a district court order disqualifying it as counsel for Dr. Gary Tubbs in a personal injury lawsuit against Bogus Basin Recreational Association, Inc. ("Bogus Basin"). Bogus Basin was represented by Elam & Burke in the proceedings. Elam & Burke moved to disqualify Hepworth Holzer after an associate attorney who worked at Elam & Burke when Tubbs initiated his lawsuit went to work for Hepworth Holzer and assisted the firm on a memorandum in support of a motion to reconsider filed in the case. The district court granted Elam & Burke's motion. The district court ordered that "[a]ny attorney associated with Hepworth Holzer, LLP, including [the associate attorney], are disqualified from any further representation of [Dr.] Gary Tubbs in this matter and from providing any information from its files after January 21, 2021, and cannot relay any information discussed or received about this case after January 21, 2021[,] to Tubbs or any new attorney/firm representing Tubbs." Hepworth Holzer contends the district court's disqualification and gag order is clearly erroneous and unconstitutional.

I. FACTUAL AND PROCEDURAL BACKGROUND

Dr. Gary Tubbs was severely injured in a bicycle accident that occurred on Bogus Basin's property. In 2019, Tubbs hired Hepworth Holzer to represent him on a contingency fee basis in a personal injury lawsuit against Bogus Basin. John Janis was the primary attorney representing Tubbs. Elam & Burke represented Bogus Basin. The case proceeded to summary judgment, where Bogus Basin argued that Tubbs’ claims were barred because, after the accident, he signed three waiver agreements releasing Bogus Basin from any and all liability or claims arising from Tubbs’ use of the Bogus Basin ski area. After Elam & Burke filed Bogus Basin's motion for summary judgment, but before a final judgment was entered, an associate attorney working for Elam & Burke resigned and started working for Hepworth Holzer. Later, the district court granted summary judgment to Bogus Basin. After working at Hepworth Holzer for one month, the associate attorney helped draft a memorandum in support of a motion for reconsideration in Tubbs’ case. In the motion to reconsider, Tubbs allegedly raised a new legal argument that Bogus Basin claimed was attributable to the associate attorney's prior communications and access to internal files while he was still an attorney for Elam & Burke.

Bogus Basin moved to disqualify Hepworth Holzer from representing Tubbs based on the alleged conflict of interest. In support of its motion, Bogus Basin submitted emails between the associate attorney and Joseph Pirtle, an Elam & Burke attorney, in which Pirtle discussed the upcoming summary judgment deadline in the case and asked the associate attorney about a particular legal theory. Pirtle also filed a declaration that stated he and the associate attorney had conversations about the summary judgment motion. Another Elam & Burke attorney, Matthew Walters, submitted an affidavit to the district court in camera . That affidavit more directly detailed a discussion Walters had with the associate attorney while the associate was working for Elam & Burke. The discussion related to a legal theory Walters had used in another case that Walters intended to rely on in the Tubbs case. Walters’ affidavit and the emails were not provided to Hepworth Holzer based on the district court's finding that they contained confidential information.

Ultimately, Bogus Basin's motion alleged the associate attorney did research and had knowledge of work product and strategy in defending the case against Tubbs based on his employment with Elam & Burke. Bogus Basin alleged the associate attorney's conflict was imputed to the entire firm under Idaho Rule of Professional Conduct ("I.R.P.C.") 1.10. Tubbs opposed the motion, supported by the declaration of Hepworth Holzer attorney John Janis. The associate attorney also submitted a declaration in which he adamantly denied: (1) ever having represented Bogus Basin while employed by Elam & Burke, (2) having otherwise obtained any confidential information about Bogus Basin, or (3) having used any information related to Bogus Basin to its disadvantage. In support, the associate attorney emphasized that he did not bill Bogus Basin for any legal services—highlighting the brief nature of his involvement in the case.

After considering the conflicting testimony, the district court found that, although the associate attorney did not represent Bogus Basin during his time at Elam & Burke, he possessed confidential information and had access to internal case files. Of particular importance to the district court, was that the associate attorney provided Pirtle a brief that Walters had filed in an unrelated 2014 Bogus Basin matter—before the associate attorney's employment at Elam & Burke—that allegedly came from a sealed court case. Thus, the district court found that the associate attorney could have only retrieved that memorandum from his search of Elam & Burke's files.

The district court found the associate attorney violated I.R.P.C. 1.9(b) and (c) because he "switched sides" when he started working at Hepworth Holzer and helped draft the memorandum in support of the motion for reconsideration. The court noted that while almost every argument in the motion for reconsideration could be traced to John Janis’ work that was submitted to the court before the associate attorney joined the firm, there was "no de minim[i]s rule when it comes to protecting confidential information or barring an attorney from representing both sides in the litigation."

Despite finding that most of the motion's argument was Janis’ work, the district court held that a single novel argument was based on confidential information the associate attorney gained while employed at Elam & Burke. Thus, the court found that the associate attorney violated I.R.P.C. 1.9(b) by working on the case without obtaining Bogus Basin's written informed consent. The court also found that under I.R.P.C. 1.10, the associate attorney's conflict was imputed to Hepworth Holzer because the firm did not screen the associate attorney from participating in the case. Finding that Hepworth Holzer's continued representation of Tubbs would be a continuing violation of the Rules of Professional Conduct, and that Bogus Basin would be damaged otherwise, the district court held that Hepworth Holzer must terminate its representation of Tubbs. The district court granted Bogus Basin's motion to disqualify and struck the memorandum Hepworth Holzer had filed in support of Tubbs’ motion for reconsideration from the record. The district court also ordered that Hepworth Holzer could not share any information from its files or speak to Tubbs or any other attorney about information discussed or received after January 21, 2021—the date the associate attorney was hired. Hepworth Holzer petitioned this Court for a writ of mandamus or a writ of prohibition. This Court issued a stay in the district court proceedings and granted Bogus Basin's petition to intervene.

II. ISSUES ON APPEAL

1. Does Hepworth Holzer have standing to obtain the relief requested?

2. Did the district court lack jurisdiction to issue the disqualification order?

3. Should this Court issue a writ of prohibition or writ of mandamus to address the district court's order disqualifying Hepworth Holzer as Tubbs’ counsel?

4. Should Judge Norton be disqualified for cause if the case is remanded?

III. STANDARD OF REVIEW

This Court maintains "original jurisdiction to issue writs of mandamus, certiorari, prohibition, and habeas corpus, and all writs necessary or proper to the complete exercise of its appellate jurisdiction." Idaho Const. art. V, § 9. "Any person may apply to the Supreme Court for the issuance of any extraordinary writ or other proceeding over which the Supreme Court has original jurisdiction." I.A.R. 5(a). "This original jurisdiction is limited only by the separation of powers provisions contained in Article II, Section 1 of the Idaho Constitution and this Court's own rules." Ybarra v. Legislature by Bedke , 166 Idaho 902, 906, 466 P.3d 421, 425 (2020) (citing Mead v. Arnell , 117 Idaho 660, 663, 791 P.2d 410, 413 (1990) ).

A writ of mandate may be issued "to any inferior tribunal ... to compel the admission of a party to the use and the enjoyment of a right or office for which he is entitled, and from which he is unlawfully precluded by such inferior tribunal. ..." I.C. § 7-302. The writ is only available in limited circumstances "where there is not a plain, speedy and adequate remedy in the ordinary course of law. It must be issued upon affidavit, on the application of the party beneficially interested." I.C. § 7-303. A writ of mandamus is not a writ of right, and this Court's choice to issue a writ is discretionary when compelled by urgent necessity. Regan v. Denney , 165 Idaho 15, 20, 437 P.3d 15, 20 (2019).

The writ of prohibition is substantially similar in both scope and limitation: "It may be issued by the [S]upreme [C]ourt or any district court to an inferior tribunal, or to a corporation, board or person in all cases where there is not a plain, speedy and adequate remedy in the...