Sharpe v. Leonard Stulman Enterprises Ltd, L-97-3537.

• Decision Date: 21 July 1998
• Docket Number: No. L-97-3537.,L-97-3537.
• Citation: Sharpe v. Leonard Stulman Enterprises Ltd, 12 F.Supp.2d 502 (D. Md. 1998)
• Parties: Deborah SHARPE, et al., v. LEONARD STULMAN ENTERPRISES LIMITED PARTNERSHIP, et al.
• Court: U.S. District Court — District of Maryland

12 F.Supp.2d 502

Deborah SHARPE, et al., v. LEONARD STULMAN ENTERPRISES LIMITED PARTNERSHIP, et al.

No. L-97-3537.

United States District Court, D. Maryland.

July 21, 1998.

C. Christopher Brown, Lauren E. Willis, Baltimore, MD, for Plaintiffs.

Paul Mark Sandler, W. Michael Mullen, Joseph J. Coppola, Baltimore, MD, for Defendants.

MEMORANDUM

LEGG, District Judge.

Before the Court are defendants' Motion in Limine to preclude the use of the affidavits and potential testimony of defendants' former employees, and plaintiffs' Motion to Interview the same witnesses. Defendants urge that this Court rule swiftly on the Motion in Limine, because they have served deposition notices on the witnesses in question for depositions to take place on August 10, 11, and 12, 1998. The parties have comprehensively briefed the issues regarding the Motions, and in light of the need for expediency in advance of the scheduled depositions, the Court dispenses with a hearing. See Local Rule 105.6 (D.Md.1997). For the reasons stated below, the Court shall, by separate Order, DENY defendants' Motion in Limine and GRANT plaintiff's Motion to Interview Witnesses.

I. Background

At issue is the testimony of three former employees of the defendants: Dee Posedenti, Cynthia Thurlow, and Gilbert Rybak. Defendants operate an apartment complex in Baltimore County called Kenilworth at Perring Park. Plaintiffs, four African-American former tenants of the apartment complex, brought suit in this Court under the federal Fair Housing Act, alleging that the defendants discriminated against them on the basis of their race by "steering" them to less desirable units in the back of the complex.

This suit follows on the heels of a 1996 Maryland state court action, in which a not-for-profit fair housing organization called Baltimore Neighborhoods, Inc. ("BNI"), and two African-American "testers" brought suit against the same defendants alleging violations of state fair housing law for essentially identical "steering." According to BNI's counsel, BNI first learned of defendants' pattern of racial "steering" when it received an anonymous telephone call in 1994 from a former Kenilworth rental agent, who claimed that her supervisors had directed her to engage in this practice. (See Mot. Interview Witnesses Exh. A, Affid. Andrew D. Freeman ("Freeman Affid.") at ¶ 3.) After further anonymous conversations, BNI sent two "testers" to the complex, who apparently confirmed the informant's claims. The anonymous rental agent ultimately identified herself as Ms. Posedenti.

BNI's counsel investigated the claim further. During their investigation, counsel spoke with Ms. Posedenti and with another former rental agent, Ms. Thurlow. BNI filed its state court suit on August 31, 1995. In March 1997, after discovery had begun in the case, BNI's counsel informed counsel for Kenilworth that they intended to contact non-managerial employees of the apartment complex, and invited Kenilworth's counsel to file a protective order if appropriate; Kenilworth's counsel did not file such a motion. (Freeman Affid. at ¶ 9.)

In April, BNI's counsel obtained an affidavit from Ms. Posedenti; in June, counsel obtained affidavits from Ms. Thurlow and a third former rental agent, Mr. Rybak. (See Mot. Interview Witnesses Exhs. B, C, & D.) Each of the three former rental agents confirmed in their affidavits that their supervisors had instructed them to "steer" African-Americans to units at the rear of the apartment complex. (See id.) According to BNI's counsel, none of the three former employees worked at Kenilworth at the time that BNI's "testers" had made their visits, and none of the three disclosed any of Kenilworth's confidential information or attorney-client privileged communications. (Freeman Affid. at ¶ 14.)

Kenilworth and BNI subsequently settled their suit. However, following media publicity of the BNI suit, plaintiffs brought the instant suit alleging similar "steering." Brown, Goldstein & Levy, the law firm which had represented BNI in the previous law suit, also represents plaintiffs in the instant law suit.¹ Suspecting that plaintiffs in this case would attempt to use the affidavits or testimony of the three former rental agents, defendants filed a Motion in Limine, asserting that use of the affidavits or testimony would violate professional conduct rules prohibiting certain ex parte communications. Plaintiffs, in turn, opposed the Motion in Limine and filed a "Motion to Interview Witnesses."

II. Discussion

The legal dispute regarding contact with the defendants' former employees centers on this Court's interpretation of Maryland Rule of Professional Conduct 4.2. This Court applies the Maryland professional responsibility rules as adopted by the Maryland Court of Appeals. See Local Rule 704 (D.Md.1997). That Court has adopted the Maryland Rules of Professional Conduct. See Maryland Rule 16-812 & Appendix (Michie 1998). Maryland Rule of Professional Conduct 4.2 states:

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 official Comment to the Rule adds:

In the case of an organization, this Rule prohibits communications by a lawyer for one party concerning the matter in representation with persons having a managerial responsibility on behalf of the organization, and with any other person whose act or omission in connection with that matter may be imputed to the organization for purposes of civil or criminal liability or whose statement may constitute an admission on the part of the organization.

On the Rule's face and even with the aid of the official Comment, Rule 4.2 is at best unclear regarding its application to ex parte contact with former employees of a party organization. In the absence of applicable Maryland precedent addressing this issue, several members of this Court have considered the scope and application of this Rule in cases involving ex parte communication with former employees, reaching somewhat different results. See Plan Comm. v. Driggs, 217 B.R. 67 (D.Md.1998) (Motz, C.J.); Davidson Supply Co., Inc. v. P.P.E., Inc., 986 F.Supp. 956 (D.Md.1997) (Smalkin, J.); Zachair, Ltd. v. Driggs, 965 F.Supp. 741 (D.Md.1997) (Davis, J.); Camden v. Maryland, 910 F.Supp. 1115 (D.Md.1996) (Messitte, J.). To the extent that these cases disagree over the proper scope of the Rule, however, this Court need not resolve the conflict, because all of these cases agree that the Rule does not prohibit ex parte communication with former employees who do not possess confidential or privileged information, and whose statements or actions cannot be imputed to their former employer.

In Camden, Judge Messitte considered an employment discrimination case against Bowie State University ("BSU"). When the claim at issue had first come to its attention, BSU had assigned a Special Assistant to the President of BSU for affirmative action programs to investigate the allegations. Camden, 910 F.Supp. at 1116. The Special Assistant became the "principal contact person" for BSU's counsel regarding the claim, regularly consulted with top BSU administrators and BSU's counsel on the case, and actively sent and received confidential communications, including assessments of the plaintiff's claims and appraisals of their likelihood of success. Id. at 1117. While the case was still pending, however, the Special Assistant left BSU on "less than amicable terms." Id. Thereafter, the Special Assistant spoke with plaintiff's counsel ex parte (and without BSU's knowledge), divulging communications between himself and BSU's counsel, as well as communications prepared by or based on the advice of BSU's counsel, including BSU's counsel's appraisal of the plaintiff's case. Id. at 1117-18.

After a thorough review of the case law and commentary on Rule 4.2, Judge Messitte held that

a lawyer representing a client in a matter may not, subject to a few exceptions, have ex parte contact with the former employee of another party interested in the matter when the lawyer knows or should know that the former employee has been extensively exposed to confidential client information of the other interested party.

Id. at 1116. In so doing, Judge Messitte considered a preliminary draft of the Third Restatement of the Law Governing Lawyers, which he considered to "extract the organizing principle from th[e] various authorities" on the subject. See id. at 1121-22. The draft Restatement would extend the prohibition on ex parte communications in Rule 4.2 to "a person connected with the organization ... who supervises, directs or regularly consults with a lawyer representing the organization concerning the matter," as well as to "a person whom the lawyer knows to have been extensively exposed to relevant trade secrets, confidential client information, or similar confidential information of another party interested in the matter." See id. at 1121 (quoting Restatement (Third) of the Law Governing Lawyers §§ 159, 162 (Preliminary Draft No. 10, 1994)). Judge Messitte explained that the Restatement's summation of the authority was

applicable to former as well as current employees [and] focuses not upon the individual's status as employee, but looks instead to the extent of the confidences shared.... As Comment [d] to Proposed Rule 162 points out: `Only some persons exposed to a principal's confidential information will have been exposed to the extent stated.' Former employees whose exposure has been less than extensive would still be available for ex parte interviews.

Id. at 1121-22. Applying the principle he had developed to the case at hand, Judge Messitte concluded that plaintiff's counsel had violated the Rule. Id. at 1123.

In Zachair, Judge Davis considered a similar issue. In that case, plaintiff...