Paul E. Iacono Structural Engineer, Inc. v. Humphrey, 81-4360

CourtUnited States Courts of Appeals. United States Court of Appeals (9th Circuit)
Writing for the CourtBefore FLETCHER and BOOCHEVER; KENYON
Citation722 F.2d 435
Parties113 L.R.R.M. (BNA) 3516, 98 Lab.Cas. P 10,404 PAUL E. IACONO STRUCTURAL ENGINEER, INC., Plaintiff-Appellee, v. Robert R. HUMPHREY, etc., et al., Defendants-Appellants.
Docket NumberNo. 81-4360,81-4360
Decision Date03 May 1983

Page 435

722 F.2d 435
113 L.R.R.M. (BNA) 3516, 98 Lab.Cas. P 10,404
Robert R. HUMPHREY, etc., et al., Defendants-Appellants.
No. 81-4360.
United States Court of Appeals,
Ninth Circuit.
Submitted Sept. 17, 1982.
Decided May 3, 1983.

Page 436

Robert L. Zaletel, Littler, Mendelson, Fastiff & Tichy, San Francisco, Cal., for defendants-appellants.

Blythe Mikelson, Van Bourg, Allen, Weinberg & Roger, San Francisco, Cal., for plaintiff-appellee.

Appeal from the United States District Court for the Northern District of California.

Before FLETCHER and BOOCHEVER, Circuit Judges, and KENYON, * District Judge.

KENYON, District Judge:

This is an appeal from a final order of the district court disqualifying the law firm representing the defendants in an action based on alleged unfair labor practices of the defendants. The district court disqualified the firm on the ground that one of

Page 437

the attorneys of the firm, prior to his employment by the firm, had been a staff attorney to the National Labor Relations Board (NLRB) and in that capacity had investigated the same unfair labor practices that are the subject of this action. We have jurisdiction under 28 U.S.C. Sec. 1291 (1976) and affirm. 1

In the spring of 1978, plaintiff-appellee Paul E. Iacono Structural Engineer, Inc. (Iacono) filed several unfair labor practice charges with the NLRB. Iacono contended that secondary picketing and leafleting by several labor unions at one of Iacono's job sites violated section 8(b) of the National Labor Relations Act, 29 U.S.C. Sec. 158(b) (1976). Iacono also filed an unfair labor practice charge against Carpenters Local Union No. 1622 (Local 1622), a member of defendant Alameda Building and Construction Trades Council (Alameda) for refusing to cross the picket lines of defendants.

Together with several other NLRB attorneys, Paul Supton was assigned to investigate Iacono's charges and prepare them for trial. He became actively involved in the investigation of several of the charges and interviewed and took statements from a number of Iacono's key employee-witnesses. A statement taken by Supton from a job superintendent at Iacono's job site, for example, describes in detail the interruptions in work caused by defendants' secondary picketing and distribution of leaflets. Similarly, another statement taken by Supton from an employee of Iacono describes among other things picketing by the defendants on certain dates and the refusal of Local 1622 to cross defendant's picket lines. During the investigation of the charges filed against Local 1622, Supton had numerous discussions with Iacono's attorney regarding the plaintiff company and all aspects of the picketing by the defendants. The record also contains letters from Supton to Iacono's attorney pertaining to the sufficiency of Iacono's evidence against Local 1622 and a proposed settlement.

In the meantime, on May 5, 1978, Iacono filed a complaint against the defendants 2 in federal court, contending that construction delays and other injuries to Iacono's business and property that had resulted from defendants' secondary picketing and leafleting gave rise to a private claim for damages and declaratory relief under section 303 of the Labor Management Relations Act, 29 U.S.C. Sec. 187 (1976). Defendants retained the law firm of Van Bourg, Allen, Weinberg & Roger (Van Bourg) for their defense in the district court action.

On August 4, 1980, Supton left the NLRB and joined Van Bourg as an associate. At the time Van Bourg hired Supton, the firm had no knowledge of Supton's involvement in the Iacono matter while he was at the NLRB. Furthermore, Supton never did any legal work on the Iacono case for the Van Bourg firm and did not make a formal appearance in the action. 3 Nevertheless, the law firm did not prohibit discussions between Supton and other Van Bourg attorneys with regard to the Iacono matter, or otherwise take any measures, formal or informal, to isolate Supton from Van Bourg attorneys working on the Iacono matter in

Page 438

order to ensure that Supton's pre-hiring knowledge would not intentionally or accidentally be disseminated to other members of the firm. Nor was he excluded from all financial reward from the case that might be reflected in year-end bonuses or the like.

Over eight months after Supton joined Van Bourg, Iacono filed a motion for an order disqualifying Van Bourg from further representation of the defendants in the Iacono case, claiming that Canon 9 and certain disciplinary rules of the American Bar Association Model Code of Professional Responsibility (the Model Code) mandated disqualification. On June 26, 1981, the district court ordered Van Bourg disqualified. The court held that Supton did not have "substantial responsibility" for the Iacono matter while at the NLRB and thus neither he nor Van Bourg had violated Disciplinary Rule 9-101(B) of the Model Code. Nonetheless, the court held that Van Bourg's representation of the defendants failed to maintain an "appearance of propriety" and thus violated Canon 9 of the Model Code.


Since the district court has primary responsibility for controlling the conduct of attorneys practicing before it, Trone v. Smith, 621 F.2d 994, 999 (9th Cir.1980), an order disqualifying counsel will not be disturbed if the record reveals "any sound" basis for the court's action, Gas-A-Tron of Arizona v. Union Oil Co. of California, 534 F.2d 1322, 1325 (9th Cir.), cert. denied, 429 U.S. 861, 97 S.Ct. 164, 50 L.Ed.2d 139 (1976). Thus, we will not reverse the district court unless the court either misperceives the relevant rule of law, Trone, 621 F.2d at 999, or abuses its discretion, Gas-A-Tron, 534 F.2d at 1325 (grant of disqualification motion overturned where facts did not support district court's finding that the prior and present representations were substantially related).


Defendants challenge the disqualification order on four grounds: (1) that the ethical rules applicable to lawyers practicing before the district court do not include the provisions of the Model Code; (2) that, even if the provisions of the Model Code are applicable, Supton's representation of defendants does not create an appearance of impropriety; (3) that, even if Supton must be disqualified, the remainder of the Van Bourg firm need not be disqualified; and (4) that, in any event, Iacono waived its right to secure Van Bourg's disqualification by delaying eight months. We examine these contentions in turn.

I. Applicability of Model Code in District Court.

Defendants argue first that the district court erred in using the provisions of the Model Code to disqualify Van Bourg because the local rules of the Northern District of California, unlike those of other district courts in California, do not specifically adopt the provisions of the Model Code as ethical rules governing the practice of lawyers appearing before that court. We disagree with the conclusion that to have force the Model Code must be specifically adopted.

The Model Code is itself not law but rather merely a suggested body of ethical principles and rules upon which reasonable lawyers, concerned about the proper role of the legal profession in American society, have reached a consensus. Since "[a]dvance notice is essential to the rule of law" and since "it is desirable that an attorney or client be aware of what actions will not be countenanced," In re Coordinated Pretrial Proceedings in Petroleum Products Antitrust Litigation, 658 F.2d 1355, 1360 (9th Cir.1981), cert. denied, 455 U.S. 990, 102 S.Ct. 1615, 71 L.Ed.2d 850 (1982), the provisions of the Model Code, standing alone, present no just basis for disqualification of a lawyer. Until the Model Code is adopted as law by the courts, the legislature, or the regulatory authority charged with the discipline of lawyers in a particular jurisdiction, the canons and disciplinary rules of the Model Code are merely hortatory, not proscriptive. See id. at 1359 n. 5 (upholding disqualification based on violation of provision

Page 439

of Model Code where "the reference to the ABA Code in Local Rule 1.3(d) sufficiently invokes Canon 9 as to make it a basis" for disqualification).

In the federal system, the regulation of lawyer conduct is the province of the courts, not Congress. See Gas-A-Tron of Arizona v. Union Oil Co. of California, 534 F.2d 1322, 1324 (9th Cir.1976). In the absence of rules promulgated by higher authorities in the judicial system, the district courts are free to regulate the conduct of lawyers appearing before them. See id. at 1325. The local rules of the Northern District of California, unlike those of several other federal districts in California, 4 do not specifically adopt the provisions of the Model Code as ethical rules governing the practice of lawyers before the federal courts in that district. Local Rule 110-3 of the Northern District makes no mention of the Model Code:

Every member of the Bar of this Court and any attorney permitted to practice in this Court under Local Rule 110-2 shall be familiar with and comply with the standards of professional conduct required of members of the State Bar of California and contained in the State Bar Act, the Rules of Professional Conduct of the State Bar of California and decisions of any court applicable thereto which are hereby adopted.

N.D.Cal.R. 110-3; cf. Petroleum Products Antitrust Litigation, 658 F.2d at 1359 n. 5 (upholding disqualification under Canon 9 where local court rule made explicit reference...

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