Johnson v. Cadillac Plastic Group, Inc., Civil Action No. 95-K-1416.

• Decision Date: 27 June 1996
• Docket Number: Civil Action No. 95-K-1416.
• Citation: 930 F. Supp. 1437
• Parties: Larry C. JOHNSON, Plaintiff, v. CADILLAC PLASTIC GROUP, INC., a Michigan corporation, d/b/a Plasticrafts, Inc., Defendant.
• Court: U.S. District Court — District of Colorado

930 F. Supp. 1437

Larry C. JOHNSON, Plaintiff, v. CADILLAC PLASTIC GROUP, INC., a Michigan corporation, d/b/a Plasticrafts, Inc., Defendant.

Civil Action No. 95-K-1416.

United States District Court, D. Colorado.

June 27, 1996.

Richard C. LaFond, Charlotte N. Sweeney, LaFond & Clausen, L.L.C., Denver, CO, for Plaintiff.

Richard S. Mandelson, Mary Price Birk, Denver, CO, for Defendant.

ORDER REJECTING RECOMMENDATION OF MAGISTRATE JUDGE

KANE, Senior District Judge.

This matter is before me on the United States Magistrate Judge's Recommendation that a motion in limine filed by defendant Cadillac Plastic Group, Inc. ("Cadillac") be granted. The motion was precipitated when Plaintiff Larry Johnson announced his intention to call Karen Yablonski-Toll, his former attorney, and Paul Trujillo, a Cadillac employee with whom Yablonski-Toll had ex parte communications, as witnesses at trial. The motion sought an order in limine striking Yablonski-Toll and Trujillo as witnesses and instructing Johnson and his present counsel to refrain from referring to the communications between Yablonski-Toll and Trujillo. Alternatively, the motion requested a ruling that the attorney-client privilege and the protections of the work-product doctrine had been waived with respect to Yablonski-Toll's representation of Plaintiff in this matter. See Def.'s Mot. in Limine & to Strike Certain Witnesses (filed May 3, 1996).

The Magistrate Judge agreed with Cadillac that Yablonski-Toll's ex parte communications with Trujillo violated Rule 4.2 of the Colorado Rules of Professional Conduct. See Recommendation of United States Magistrate Judge at 3. Finding "Johnson should not be allowed to rely on evidence gathered during the course of an interview conducted in violation of the rule," the Magistrate Judge recommended Cadillac's motion in limine be granted. Id.¹

No objections to the Magistrate Judge's recommendation were filed within the ten-day period prescribed in 28 U.S.C. § 636. This does not require that I adopt the recommendation, however, and I decline to do so. See 28 U.S.C. § 636(b)(1) (district court judge may accept, reject, or modify, in whole or in part, findings or recommendations of magistrate judge). It is not at all clear to me that Yablonski-Toll's conduct in engaging in an ex parte interview with Trujillo violated Rule 4.2. Even if it did, however, the appropriate sanction for unauthorized communications with an adversary's employee would be disciplinary action against the offending attorney, not punishment of the attorney's client by the suppression of otherwise discoverable information.

I. FINDINGS OF FACT

Cadillac eliminated Johnson's Operations Manager position and terminated Johnson on August 17, 1993. Sensing before then that his job was in jeopardy, Plaintiff had contacted Yablonski-Toll in July 1993 to discuss his employment situation. As part of his July 31, 1993 Monthly Report to supervisors Rick Gough and Vern Lentz, Johnson expressed concern over the deterioration of his position and submitted a severance pay proposal. See Monthly Report (Def.'s Mot. Limine, Ex. B). The proposal identified Yablonski-Toll as Johnson's attorney, and indicated the proposal was subject to final approval by her. Johnson also provided a copy of his proposal to Frank Titas, a member of Cadillac's in-house legal staff.²

Johnson contacted Yablonski-Toll again in early October 1993. They set up a meeting and on October 11, 1993, Johnson formally retained her as counsel. Believing Trujillo might be able to verify certain factual information related to his termination, Johnson contacted Trujillo shortly thereafter. Aware that Yablonski-Toll was representing Johnson with respect to his termination, Trujillo agreed to meet with her. See Trujillo Affid. (Def.'s Mot. Limine, Ex. C), ¶¶ 5-6.

Yablonski-Toll interviewed Trujillo on October 18, 1993. Yablonski-Toll was aware Trujillo was a management-level employee of Cadillac, but understood he had no authority to speak or bind Cadillac to any position regarding employment decisions. Yablonski-Toll Affid., ¶ 6. Yablonski-Toll also understood Trujillo had no supervisory authority over Johnson, and was at most his equal or subordinate in Cadillac's organizational hierarchy. See id. She did not ask before the interview whether Trujillo had an attorney or wished to have an attorney present. Trujillo Affid., ¶ 7. Yablonski-Toll took notes during Trujillo's interview. Trujillo did not request nor was he offered a copy of the notes after the interview was concluded. Id. ¶ 8.

For reasons that cannot be ascertained from the record, Yablonski-Toll never initiated an action on Johnson's behalf. Johnson later retained the law firm of LaFond & Clausen and the instant lawsuit was filed in June 1995, nearly two years after Johnson's termination and more than 1½ years after the Trujillo interview.

Equivocations in the deposition testimony of Lentz and Trujillo in the spring of 1996 triggered renewed interest in the Yablonski-Toll/Trujillo interview. Johnson, through his new counsel, contacted Yablonski-Toll in March 1996 and learned for the first time that she had taken notes of the October 1993 meeting. Johnson requested a copy of the notes, and in April announced his intention to call both Yablonski-Toll and Trujillo as witnesses. This motion in limine ensued.

II. CONCLUSIONS OF LAW

District courts have an "obligation to take measures against unethical conduct occurring in any proceeding." FDIC v. Sierra Resources, Inc., 682 F.Supp. 1167, 1170 (D.Colo.1987). To guide its performance of this obligation, the District of Colorado has adopted the Colorado Code of Professional Responsibility. D.C.COLO.LR 83.6. Ethics opinions of the Colorado Bar Association (the "CBA") interpreting the Colorado Code are advisory, but may be considered in resolving allegations of unethical conduct.

Rule 4.2 of the Colorado Rules of Professional Conduct provides that

In representing a client, a lawyer shall not communicate about the subject of the representation with a party the lawyer knows to be represented by another lawyer in the matter, unless the lawyer has the consent of the other lawyer or is authorized by law to do so.

The Rule is substantively identical to Disciplinary Rule 7-104(A)(1) of the Model Code of Professional Responsibility, and has been adopted in similar form in numerous other jurisdictions.³ The CBA Ethics Committee published a formal opinion on the scope of DR 7-104(A)(1) in 1987, see CBA Revised Ethics Opinion No. 69: Communicating With the Employee or Former Employee of an Adverse Party Organization (reprinted at 16 Colo.Law. 1429 (Aug. 1987)), which opinion provides guidance in this case.⁴

Revised 69 acknowledges and attempts to resolve the conflict between "one's right to receive and be protected by the advice of one's attorney and a client's interest in a quick and inexpensive exploration of a potential legal claim." 23 Colo.Law. at 1429. In doing so, Revised 69 breaks the Rule into five parts: (1) "Communication"; (2) "Subject of the Representation"; (3) "Party"; (4) "Knows" to be represented; and (5) "Authorized by law" to communicate without prior consent. A determination of whether Cadillac and Trujillo were "parties" within the meaning of Rule 4.2 in October 1993 lies at the heart of the present dispute.

A. Was Cadillac a "Party" in October 1993?

In determining whether an organizational employee is a "party," Revised 69 instructs that one must first determine whether the organization is a "party" and then determine whether the employee should also be considered a "party" or merely a "bystander witness." 23 Colo.Law at 1430. Reasoning that the perceived potential for harm to the attorney-client relationship underlying the Rule is not dependent on the existence of a civil action, Revised 69 states an organization does not need to be named in litigation to be a "party." Id. "An organization should be considered a party anytime it has specifically retained counsel to represent its interests regarding the subject of representation or has specifically referred the matter to house counsel." Id. (citing the American Bar Association (ABA) Model Rules of Professional Conduct, Rule 4.2 comment (1980)). Even if it is determined that an organization is a party, its employees will not be considered as such unless they are in a position to commit or bind the organization on the subject of the representation.

Cadillac urges a broad interpretation of the "specifically retained" or "referred" language in the ABA comment. It argues the reference to potential litigation in Johnson's July 1993 Monthly Report and severance proposal, together with the fact Johnson sent a copy of the report to Titas, rendered both Cadillac and Trujillo "parties" under Rule 4.2 and triggered its no-contact provisions. Because Trujillo was a management level employee of Cadillac at the time of the 1993 interview, Cadillac maintains he, too, was a "party" with whom ex parte contact was forbidden. I disagree. Countervailing policies militate against Cadillac's interpretation of Rule 4.2 in this case.

I agree an organization or business entity may be a "party" under the Rule before litigation formally commences. That does not mean, however, that a corporation is immune from legitimate informal fact-gathering processes as soon as an employee notifies it that he is unhappy and has consulted counsel. An interpretation of Rule 4.2 that limits counsel to (and burdens their clients with the costs of) formal discovery during the investigatory stages of civil litigation is not only fundamentally unfair, but also frustrates the purposes of Rule 11, Fed.R.Civ.P.

A recent decision by the District of Utah is directly on point. Considering Utah's identical Rule 4.2, the court in Weider Sports Equipment Co., Ltd. v. Fitness First, Inc., held the Rule's no-contact provisions did not attach during the investigatory stages of a civil...