DISTRICT COURT OF APPEAL OF THE STATE OF FLORIDA
FOURTH DISTRICT
DOLORES BALABAN,
Petitioner,
v.
PHILIP MORRIS USA INC. and R.J. REYNOLDS TOBACCO COMPANY,
Respondents.
No. 4D17-2479
[January 10, 2018]
Petition for writ of certiorari to the Circuit Court for the Seventeenth
Judicial Circuit, Broward County; John J. Murphy, III, Judge; L.T. Case
No. 14-24204(19).
Juan P. Bauta, II, and James L. Ferraro of The Ferraro Law Firm,
Miami, for petitioner.
Frances Daphne O’Connor and Geoffrey J. Michael of Arnold & Porter
Kaye Scholer LLP, Washington, DC, for respondent Philip Morris USA Inc.
Jason T. Burnette of Jones Day, Atlanta, GA, for respondent R.J.
Reynolds Tobacco Company.
PER CURIAM.
Dolores Balaban seeks certiorari review of a trial court order granting a
motion to disqualify the Ferraro Law Firm (“the Ferraro firm”) from
representing her in a pending civil action against Philip Morris USA, Inc. (PM
USA) and R.J. Reynolds Tobacco Company (RJR). Certiorari lies to review
this order denying disqualification. Philip Morris USA Inc. v. Caro,
207 So. 3d
944, 949 (Fla. 4th DCA 2016).
The trial court granted the motion based on this Court’s recent decision in
Caro, where we quashed a trial court order denying PM USA’s motion to
disqualify the Ferraro firm and its attorney Paulo Lima (“Attorney Lima”).
Id.
at 951. However, the circumstances in this case distinguish it from Caro and
compel a different analysis altogether, including application of a different
provision of the Rules Regulating the Florida Bar. Thus, the trial court
departed from the essential requirements of law in finding Caro dispositive.
The court also departed from the essential requirements of law in failing to
make the required findings of fact under the correct rule and on the issue of
RJR’s standing to join in the motion to disqualify. We grant the petition,
quash the trial court’s order, and return the case to the trial court for further
proceedings consistent with this opinion.
Briefly stated, petitioner sued PM USA, RJR, and other defendants in 2014
in one of many Engle 1 progeny cases involving cigarette smokers who suffered
injury or died as a result of smoking. PM USA moved to disqualify Attorney
Lima and the Ferraro firm from representing petitioner, alleging that Attorney
Lima had previously represented PM USA while employed by Hunton &
Williams, LLP (“the Hunton firm”). The motion to disqualify included
allegations that Attorney Lima billed more than 1,500 hours on PM USA
matters including more than 1,300 hours defending PM USA in smoking and
health litigation while working at the Hunton firm, with nearly 375 hours
spent specifically on Engle tobacco-related issues. PM USA also alleged
Attorney Lima had access to PM USA’s litigation databases and had reviewed
its internal documents, including those that were highly confidential and
privileged. PM USA therefore claimed Attorney Lima and the Ferraro firm had
an impermissible conflict of interest precluding representation of petitioner
as the plaintiff in this case against it. RJR joined in the motion.
The motion cited Rule Regulating The Florida Bar 4-1.10(b) on imputation
of conflicts of interest, which provides as follows:
(b) Former Clients of Newly Associated Lawyer. When a lawyer
becomes associated with a firm, the firm may not knowingly
represent a person in the same or a substantially related matter
in which that lawyer, or a firm with which the lawyer was
associated, had previously represented a client whose interests
are materially adverse to that person and about whom the lawyer
had acquired information protected by rules 4-1.6 and 4-1.9(b)
and (c) that is material to the matter.
Petitioner pointed out in her opposition to this motion that Attorney Lima
had left employment with the Ferraro firm shortly before the motion to
disqualify was filed in this case. She argued that this event distinguished the
facts in this case from those in Caro. In Caro, this Court applied Rule 4-
1.10(b) and concluded that the movant, PM USA, had demonstrated that
Attorney Lima had actual knowledge of material confidential information.
Caro, 207 So. 3d at 950. We then ruled that the plaintiff’s attorney in that
1 Engle v. Liggett Grp., Inc.,
945 So. 2d 1246 (Fla. 2006).
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case had not met the burden to prove that Attorney Lima had not actually
acquired such information.
Id. at 950–51.
Petitioner argued that because Attorney Lima was no longer associated
with the Ferraro firm at the time the motion to disqualify was filed, this was
no longer a case involving a former client of a newly associated lawyer.
Rather, the case now involved the client of a formerly associated lawyer and
therefore Rule 4-1.10(c) controlled. That Rule, in turn, provides as follows:
(c) Representing Interests Adverse to Clients of Formerly
Associated Lawyer. When a lawyer has terminated an
association with a firm, the firm is not prohibited from thereafter
representing a person with interests materially adverse to those of
a client represented by the formerly associated lawyer unless:
(1) the matter is the same or substantially related to that in which
the formerly associated lawyer represented the client; and
(2) any lawyer remaining in the firm has information protected by
rules 4-1.6 and 4-1.9(b) and (c) that is material to the matter.
R. Regulating Fla. Bar. 4-1.10(c). Petitioner contended that the Ferraro firm
could not be disqualified under this Rule unless the firm had PM USA’s or
RJR’s confidential, material information. She presented deposition testimony
and affidavits stating that no confidential information from Attorney Lima’s
previous work at the Hunton firm had been provided to any lawyer or other
employee of the Ferraro firm.
Petitioner also argued that RJR lacked standing to join in PM USA’s motion
to disqualify because it had no privity with Attorney Lima or the Ferraro firm.
RJR countered that its “joint defense” relationship with PM USA conferred
standing, and alleged that Attorney Lima had access to RJR’s confidential
information while he was an associate at the Hunton firm. In support of its
position, RJR cited State Farm Mutual Automobile Insurance Co. v. K.A.W.,
which recognized that “someone other than the client may request
disqualification” where a conflict of interest “is such as clearly to call in
question the fair or efficient administration of justice.”
575 So. 2d 630, 632
(Fla. 1991) (quoting R. Regulating Fla. Bar 4-1.7 Cmt.).
The trial court held a hearing on the motion to disqualify and concluded
that Caro required it to grant the motion to disqualify the law firm in this
case. In its written order, the court expressly rejected petitioner’s argument
that Caro no longer controlled because Attorney Lima had left the Ferraro
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firm. The court failed to address whether RJR had standing to join in PM
USA’s motion.
While orders on motions to disqualify are reviewed for abuse of discretion,
Florida courts recognize that disqualification of counsel “is an extraordinary
remedy and should only be resorted to sparingly.” Manning v. Cooper,
981
So. 2d 668, 670 (Fla. 4th DCA 2008) (quoting Alexander v. Tandem Staffing
Sols., Inc.,
881 So. 2d 607, 608 (Fla. 4th DCA 2004)); see also Vick v. Bailey,
777 So. 2d 1005, 1007 (Fla. 2d DCA 2000).
Here, the trial judge departed from the essential requirements of law in
failing to apply Rule 4-1.10(c) as it is undisputed that Attorney Lima was no
longer associated with the Ferraro firm at the time the motion to disqualify
was filed. See Nissan Motor Corp. in U.S.A. v. Orozco,
595 So. 2d 240, 243
(Fla. 4th DCA 1992) (holding that Rule 4-1.10(c) applies where the lawyer with
the purported conflict of interest has terminated an association with the firm
sought to be disqualified); see also Sch. Bd. of Broward Cty. v. Polera Bldg.
Corp.,
722 So. 2d 971, 973 (Fla. 4th DCA 1999). The trial court’s erroneous
conclusion that Caro mandated disqualification likewise led to its failure to
make the required findings under Rule 4-1.10(c). See
Polera, 722 So. 2d at
973 (“Disqualification cases under Rule 4-1.10 require the trial court to make
a factual determination of the issues specified in subsections (b) and (c).”).
Therefore, we grant the petition for writ of certiorari, quash the order
granting disqualification, and return the case to the trial court for further
proceedings consistent with this opinion. On remand, the trial court shall
also address the issue of whether RJR has standing to join in PM USA’s
motion to disqualify.
DAMOORGIAN, FORST and KLINGENSMITH, JJ., concur.
* * *
Not final until disposition of timely filed motion for rehearing.
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