Starner v. Johnson

[Cite as Starner v. Johnson, 2020-Ohio-4580.]
COURT OF APPEALS
FRANKLIN COUNTY, OHIO
TENTH APPELLATE DISTRICT
JEFFREY STARNER, : APPEAL NO. 19AP635
TRIAL NO. 17 CV 004726
Plaintiff-Appellee, :
vs. : O P I N I O N.
NEIL JOHNSON, :
:
1212 CAPITAL LLC,
:
and
:
LAWRENCE EVANS & CO., LLC,
Defendants-Appellants. :
Civil Appeal From: Franklin County Court of Common Pleas
Judgment Appealed From Is: Affirmed
Date of Judgment Entry on Appeal: September 24, 2020.
Thomas C. Loepp Law Offices Co., LPA, and Thomas C. Loepp, for Plaintiff-Appellee,
Luper Neidenthal & Logan and Gregory H. Melick, for Defendants-Appellants.
OHIO TENTH DISTRICT COURT OF APPEALS
BERGERON, JUDGE.
{¶1} In this “side-switching” case that resulted in counsel’s disqualification,
the appeal focuses on procedural obligations that failed to occur before the trial court.
Unfortunately for the appellants, their path to reversal stumbles over a familiar
obstacle—waiver. While they criticize the trial court for failing to convene an
evidentiary hearing or issue findings of fact, they never requested either below, and in
fact actively opposed an evidentiary hearing. We ultimately conclude that both of
these arguments (which form the crux of the appeal) are waived, and affirm the
judgment below.
I.
{¶2} This appeal stems from the trial court’s entry granting plaintiff-appellee
Jeffrey Starner’s motion to disqualify defendants-appellants’, Neil Johnson, 1212
Capital LLC, and Lawrence, Evans & Co., LLC, (collectively, the “defendants”),
counsel. For some background, we begin with a brief overview of the underlying
litigation. In 2014, Mr. Starner sold his trucking business to Merchants Holding LLC—
an entity controlled by some of the defendants. Shortly after this sale, things went
south, with Merchants Holding LLC divesting some of the trucking business’s valuable
assets and creditors swarming in, suing both Merchants Holding LLC and Mr. Starner
(still on the hook personally for debts associated with his former business) for failure
to satisfy outstanding debts. This prompted Mr. Starner to file suit and ultimately
receive a judgment on a cognovit note against Merchants Holding LLC. When efforts
to satisfy that judgment proved unavailing, Mr. Starner initiated the current litigation,
in May 2017, against the defendants (and various others not involved in this appeal),
alleging securities and common law fraud and breach of contract, among other things.
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{¶3} After two years of legal wranglings that we will skip over in the interests
of brevity, the action stood on the precipice of trial. But roughly a month before trial
(in August 2019), our story takes a turn that leads to this appeal, when Gregory H.
Melick and the law firm of Luper Neidenthal & Logan (“LNL”) entered an appearance
as additional trial counsel for the defendants. Attorney John Alden had recently joined
LNL, but the problem was that Mr. Alden (a transportation lawyer, not a litigator) had
represented Mr. Starner for years in a variety of his business endeavors. Although the
parties dispute whether, in August 2019, Mr. Starner was Mr. Alden’s current client,
they agree “without question” that Mr. Alden previously represented Mr. Starner and
his companies. Mr. Starner promptly moved for disqualification of Mr. Melick and
LNL (as well as co-defense counsel), alleging that he retained a current relationship
with Mr. Alden and that Mr. Alden had access to confidential information that could
be useful to defendants in the litigation.
{¶4} To put a finer point on it, Mr. Starner specifically claimed that Mr. Alden
retained confidential information regarding his businesses, including their financial
situation, and in fact advised Mr. Starner in connection with the sale of his
companies—i.e., the sale that triggered the previous suit and current litigation—prior
to referring him to another attorney. To substantiate his motion, Mr. Starner fastened
an affidavit delineating Mr. Alden’s representation of him, his family, and his
businesses “for nearly 45 years” and asserting that he never consented to LNL’s
representation (conspicuously absent from the affidavit was any allegation that Mr.
Alden currently represented Mr. Starner, but that omission ultimately need not detain
us). In conjunction with the affidavit, Mr. Starner explicitly sought an evidentiary
hearing to enable him to prove to the court the extensive relationship between himself
and Mr. Alden as well as how prejudicial the side-switching would be.
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{¶5} The defendants, not surprisingly, had a different view of things,
opposing the disqualification motion and insisting that LNL and Mr. Melick received
no confidential information from Mr. Alden regarding this case (while also denying
that Mr. Starner was a client of LNL). But they never tendered an affidavit from Mr.
Alden and thus neglected to dispute (with any evidence, at least) that he possessed
confidential information concerning Mr. Starner that was implicated by the present
litigation. Although with at least some factual disputes swirling, one might expect LNL
to clamor for an evidentiary hearing to vindicate itself, in defendants’ opposition to
the disqualification motion, they specifically opposed the request for an evidentiary
hearing.
{¶6} As the trial date drew ever nearer, the court convened a status
conference that morphed into a hearing on the disqualification motion (albeit not an
evidentiary hearing). The parties debated the various points raised by the motion, but
no one at the hearing requested that any witness testify or otherwise requested a
formal evidentiary hearing (Mr. Melick argued orally but was not sworn as a witness).
At the conclusion of the hearing, after considering these arguments, the trial court
agreed with Mr. Starner, issuing an oral ruling disqualifying Mr. Melick and LNL as
counsel for the defendants (while denying the broader request to disqualify LNL’s co-
counsel). The next day, the court memorialized its oral proclamation from the bench,
granting (in part) Mr. Starner’s motion to disqualify pursuant to Prof.Cond.R. 1.9. The
defendants now appeal certain alleged procedural flaws embodied in the trial court’s
order granting Mr. Starner’s motion, raising a single assignment of error.
II.
A.
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OHIO TENTH DISTRICT COURT OF APPEALS
{¶7} In their sole assignment of error, defendants challenge not the merits of
the trial court’s decision, but instead the procedural journey leading to the trial court’s
grant of disqualification. Specifically, defendants fault the trial court in failing to (1)
hold an evidentiary hearing, and (2) issue findings of fact with sufficient analysis
under Kala v. Aluminum Smelting & Refining Co., Inc., 81 Ohio St.3d 1, 688 N.E.2d
258 (1998). We address each of these issues in turn, reviewing for an abuse of
discretion. See Cargould v. Manning, 10th Dist. Franklin No. 09AP-194, 2009-Ohio-
5853, ¶ 6 (“When a trial court orders disqualification of counsel, we review that
decision under an abuse-of-discretion standard.”). But first, to give context, we step
back and set the stage a bit regarding the legal standard for disqualification in side-
switching cases.
{¶8} In Kala, the Ohio Supreme Court considered whether disqualification
automatically follows when an attorney (who represented a party) leaves his or her
former employment with a firm and joins a law firm representing the opposing party
in litigation against his or her (now former) client, or alternatively, whether that law
firm may overcome a presumption of shared confidences through the institution of
effective screening mechanisms. See Kala at 3. In electing the latter path, the court
appreciated the countervailing public-policy interests of preserving a client’s
confidences, on the one hand, and, on the other hand, the modern realities of
protecting a client’s right to choose his or her counsel (assuming effective
countermeasures to avoid dissemination of that confidential information). Id. at 5-6.
Consequently, in an attempt to balance these interests, the court fashioned a three-
part test to evaluate the disqualification of an individual or entire firm when an
attorney leaves a law firm and subsequently joins a firm representing the opposing
party. The Kala test considers: 1) “whether a substantial relationship exists between
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OHIO TENTH DISTRICT COURT OF APPEALS
prior and present representations”; 2) if a substantial relationship is found, whether
the individual attorney can rebut the presumption that the “attorney shared in
confidences and representation of the prior matter,” and 3) if this presumption cannot
be rebutted and the individual attorney is disqualified, whether an “effective screen
has been created” to rebut the presumption of shared confidences between the
“quarantined attorney” and the new firm. Id. at 8-10.
{¶9} In addition to this legal standard, the court erected procedural
safeguards in order to allow the challenged firm “an opportunity to defend not only its
relationship with the client, but also its good name, reputation and ethical standards”
against the allegation of unethical conduct implicit in a motion for disqualification.
Id. at 12. Specifically, the Supreme Court explained, “the [trial] court should hold an
evidentiary hearing on a motion to disqualify and must issue findings of fact if
requested based on the evidence presented.” Id. These procedural protections do not
necessarily apply to all disqualification efforts, as we have previously recognized:
“[t]here is nothing in Kala to suggest an evidentiary hearing is required on all motions
to disqualify counsel.” Luce v. Alcox, 10th Dist. Franklin No. 04AP-1250, 2005-Ohio-
3373, ¶ 6; see Dayton Bar Assn. v. Parisi, 131 Ohio St.3d 345, 2012-Ohio-879, 965
N.E.2d 268, ¶ 15 (“But we have never held that a court must hold an evidentiary
hearing before ruling on every motion for disqualification.”); Shawnee Assoc., L.P. v.
Shawnee Hills, 5th Dist. Delaware No. 07CAE050022, 2008-Ohio-461, ¶ 34 (“This
‘side-switching’ scenario is the only instance in which the Supreme Court of Ohio has
held an evidentiary hearing is required.”).
{¶10} Nearly a decade later, the Ohio Supreme Court adopted the Ohio Rules
of Professional Conduct, which featured a slightly different standard governing
conflicts of interest regarding former clients. See Prof.Cond.R. 1.9 and 1.10;
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OHIO TENTH DISTRICT COURT OF APPEALS
Disciplinary Counsel v. Blair, 128 Ohio St.3d 384, 2011-Ohio-767, 944 N.E.2d 1161, ¶
1, fn. 1 (explaining the Rules of Professional Conduct went into effect in February
2007, and superseded the Code of Professional Responsibility). Although generally
consistent with the holding in Kala, the specific standards in Prof.Cond.R. 1.10
nevertheless superseded those announced in Kala, which include various elaborations
and refinements. See NexGen Energy Partners, LLC, v. Reflecting Blue Tech., Inc.,
11th Dist. Ashtabula No. 2016-A-0050, 2017-Ohio-5855, ¶ 28 (“We note Kala has been
superseded by the Ohio Rules of Professional Conduct.”); Dickens v. J & E Custom
Homes, Inc., 187 Ohio App.3d 627, 2010-Ohio-2634, 933 N.E.2d 291, ¶ 4 (2d Dist.)
(“The Official Comment to Prof.Cond.R. 1.10(c) indicates that it is consistent with the
holding in Kala * * * concerning disqualification of a law firm when one of its members
is personally disqualified because of a former representation. The specific standards
for disqualification in Prof.Cond.R. 1.10 nevertheless supersede those announced in
Kala, which are slightly different.”). Under Prof.Cond.R. 1.9, “[u]nless the former
client gives informed consent, confirmed in writing, a lawyer who has formerly
represented a client in a matter shall not thereafter represent another person in the
same or a substantially related matter in which that person’s interests are materially
adverse to the interests of the former client.” (Emphasis in original). When a lawyer
joins a new firm, if that lawyer had “substantial responsibility” for a former client’s
matter, the new firm shall not knowingly “represent, in the same matter, a person
whose interests are materially adverse to the interests of the former client.”
Prof.Cond.R. 1.10(c). But if the lawyer did not play a substantial role, the new firm will
not suffer disqualification in matters in which the new lawyer is disqualified under
Prof.Cond.R. 1.9 if both of the following apply: “(1) the new firm timely screens the
personally disqualified lawyer from any participation in the matter and that lawyer is
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OHIO TENTH DISTRICT COURT OF APPEALS
apportioned no part of the fee from that matter; [and] (2) written notice is given as
soon as practicable to any affected former client.” (Emphasis in original).
Prof.Cond.R. 1.10(d).
{¶11} Notwithstanding the rule-based codification, modification, and
elaboration of Kala (as the Official Comment to the rules attests), Ohio courts still
seem to deem the procedural requirements set forth in Kala alive and well. See
Dickens at ¶ 10 (reasoning the “Supreme Court did not reject or abandon” the
procedural aspects of Kala “when it adopted Prof.Cond.R. 1.10.”); City of Whitehall,
Ohio v. Olander, 10th Dist. Franklin No. 15AP-1030, 2017-Ohio-2869, ¶ 27-29
(rejecting appellants’ arguments that the trial court erred in failing to hold an
evidentiary hearing prior to disqualifying attorney because this case did not involve a
“side-switching” scenario, thereby suggesting that Kala’s evidentiary hearing
requirement still exists). Given that neither side in this appeal questions the on-going
vitality of Kala’s procedural requirements, we turn to those now.
B.
{¶12} With this backdrop in mind, we consider first defendants’ argument that
the court erred in failing to hold an evidentiary hearing prior to granting Mr. Starner’s
motion. As both parties agree, prior to joining LNL, Mr. Alden represented Mr.
Starner, assisting him with his transportation law needs. We therefore consider this a
“side-switching” scenario as explained in Kala, with Mr. Starner a former client for
purposes of our analysis.
{¶13} Consistent with the requirements of Kala, because Mr. Alden left his
prior firm and joined LNL, representing the defendants in this case, an evidentiary
hearing was indeed necessary. Nevertheless, we ultimately find no error here based
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upon defendants’ opposition to an evidentiary hearing below and their failure to lodge
any request for a hearing.
{¶14} As mentioned above, the defendants here explicitly opposed an
evidentiary hearing before the trial court, and therefore they waived their right to raise
this contradictory argument for the first time on appeal. See Zawahiri v. Alwattar,
10th Dist. Franklin No. 07AP-925, 2008-Ohio-3473, ¶ 11-19 (holding the appellant
waived argument that the court erred in analyzing the marriage contract as a
prenuptial agreement, and not as a general contract, because the appellant not only
failed to raise it to the trial court, but in fact asserted a contradictory argument below);
Revilo Tyuka, L.L.C. v. Simon Roofing & Sheet Metal Corp., 193 Ohio App.3d 535,
2011-Ohio-1922, 952 N.E.2d 1181, ¶ 22 (8th Dist.) (reasoning that because the
company-appellant’s “arguments are explicitly contrary to the arguments [it]
maintained below,” it “waived this new argument and cannot assert it on appeal.”). In
Mr. Starner’s motion to disqualify, he specifically requested “an evidentiary hearing
wherein evidence can be shown of the long-standing, nearly 45-year attorney-client
relationship between Plaintiff Jeffrey Starner and attorney John Alden, a partner with
the law firm of [LNL].” The defendants responded with an unambiguous request that
the court not only deny the motion to disqualify, but also the plea for an evidentiary
hearing: “Plaintiff’s Motion to Disqualify all Defense Counsel and Request for
Evidentiary Hearing (and Motion to Continue Trial) should be denied.” Emphasis
added. Consequently, the defendants waived this evidentiary hearing challenge and
cannot now revive it on appeal. See State ex rel. PIA Psychiatric Hosps., Inc. v. Ohio
Certificate of Need Review Bd., 60 Ohio St.3d 11, 17, 573 N.E.2d 14 (1991), fn. 4
(“Generally, an issue need not be considered on appeal if the issue was apparent at the
time of trial and was not raised before the trial court.”).
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{¶15} More to the point, defendants never explain on appeal what evidence
they would have submitted before the trial court that might have altered the result. In
other words, they muster no argument about prejudice. Mr. Melick appeared capable
of arguing all of the necessary points at the hearing, and evinced no limitations by the
absence of calling witnesses. And, of course, if defendants believed that Mr. Alden
would be the star witness who could set the record straight, we would view such a claim
with a jaundiced eye at this point since they never even submitted an affidavit from
him. Recall that in Kala, the purpose of the evidentiary hearing rested upon the need
to allow the challenged firm an opportunity to defend its relationship with the client,
reputation, and ethical compliance. See Kala, 81 Ohio St.3d at 12, 688 N.E.2d 258(“Because a request for disqualification implies a charge of unethical conduct, the
challenged firm must be given an opportunity to defend not only its relationship with
the client, but also its good name, reputation and ethical standards.”). Defendants did
have such an opportunity, although admittedly not in the exact manner that they now
demand. But this is where it falls on counsel to object and make the request for the
hearing, rather than oppose it. Consequently, based upon the defendants’ own waiver,
the fact that the court held a hearing on the issue of disqualification, and the absence
of any apparent prejudice, we find no abuse of discretion in the trial court’s failure to
convene an evidentiary hearing on this record.
C.
{¶16} So that brings us to the lack of any findings of fact. Defendants contend
that the trial court failed to support its disqualification decision with findings of fact
and sufficient analysis reflecting the Kala considerations. However, this challenge
fails for the same reason as their evidentiary hearing argument, with the defendants
waiving this issue below.
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{¶17} As noted above, Kala requires the trial court to “issue findings of fact if
requested based on the evidence presented.” (Emphasis added.) Kala at 12. We
acknowledge, as emphasized by defendants, that the syllabus of Kala does not
explicate that one must actually request findings of fact. See id. at syllabus (“[A] court
must hold an evidentiary and issue findings of fact using a three-part analysis[.]”). But
we do not see a conflict between the syllabus and the body of the opinion—the syllabus
provides the rule, and the body of the opinion explains how the rule is triggered. And
it is difficult to overlook the clarity of “is requested”—like most relief desired by a party,
it places the onus on the party to present the request in the first instance. The Supreme
Court certainly did not intimate that a party could omit such a request, lie in wait, and
then pounce on this issue for a victorious appeal. And, as we discuss below, such a
rule would yield deleterious consequences.
{¶18} The defendants here, of course, tendered no such request for findings,
despite the opportunity to do so after the trial court’s oral pronouncement and after
its written memorialization of the disqualification. To that point, defendants offer no
serious justification for their oversight on appeal—in other words, they faced no
impediment to raising this below. The defendants cannot seek reversal now based
upon their own failure to request findings. This is especially true when, as in this case,
the defendants tie their assignment of error to the trial court’s procedural faults,
touching on the merits of the disqualification decision only on the margins. See
Johnson v. Johnson, 10th Dist. Franklin No. 19AP-84, 2019-Ohio-5138, ¶ 10, quoting
In re Adoption of Gibson, 23 Ohio St.3d 170, 172, 492 N.E.2d 146 (1986) (reasoning
that one of the primary purposes of a court issuing findings of fact under the civil rules
is “ ‘to aid the appellate court in reviewing the record and determining the validity of
the basis of the trial court’s judgment.’ ”). Defendants seem to understand that,
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OHIO TENTH DISTRICT COURT OF APPEALS
without such findings, they lack a means of illustrating an abuse of discretion, which
is why the procedural aspects take center stage in their brief.
{¶19} In the face of this waiver, defendants seek to rehabilitate their claim by
pointing to this court’s decision in Luce, faulting the trial court for failing to issue
findings under the Dana test. But we see several problems with this approach. First,
Luce did not involve a side-switching scenario—instead, the disqualification effort
arose from the attorney-as-witness rule. Second, and related, Luce was applying
different substantive law (Dana, described below) rather than Kala, and the decision
predated the implementation of the Rules of Professional Conduct. Finally, perhaps
most significantly, Luce never held that parties can sit on their hands, neglecting to
request findings of fact, and that a trial court must nevertheless issue such findings on
pain of reversal. More to the point, Luce never discusses findings of fact at all.
{¶20} In Luce, this court ultimately reversed and remanded the trial court’s
order disqualifying counsel, grounding its decision on the court’s failure to provide
sufficient analysis under the Dana test. See Luce, 10th Dist. Franklin No. 04AP-1250,
2005-Ohio-3373, at ¶ 8 (“By remanding, we do not imply that disqualification is not
warranted, but that to disqualify counsel, the court must fulfill the required analysis.”).
In doing so, we relied upon a three-part test articulated by the Sixth Circuit Court of
Appeals in Dana v. Corp. v. Blue Cross & Blue Shield Mut. of N. Ohio, 900 F.2d 882,
889 (6th Cir.1990). The Dana test requires the court, when ruling on a motion to
disqualify, to determine whether “(1) a past-attorney-client relationship existed
between the party seeking disqualification and the attorney it seeks to disqualify; (2)
the subject-matter of those relationships was/is substantially related; and (3) the
attorney acquired confidential information from the party seeking disqualification.”
Dana at 888. Therefore, because the trial court undertook no such analysis below,
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this court was “unable to conduct a meaningful review of the trial court’s decision, as
we [were] unable to determine the factual and/or legal conclusions reached by the trial
court, as well as what the trial court relied upon in reaching its decision.” Luce at ¶ 8.
{¶21} As explained above, Dana does not supply the analytical framework for
a side-switching case, and in fact, Luce specifically contrasted its situation with that in
Kala. See Luce at ¶ 6 (noting that no evidentiary hearing was required given that the
case did not involve side-switching as in Kala). Defendants seemingly conflate the
procedural requirements fashioned in Kala with those discussed in Luce. But this
court based its decision in Luce upon its inability to conduct sufficient review as to
merits of the disqualification decision in light of the Dana test, rather than the need
for findings of fact under Kala or a party’s obligation to make such a request. Indeed,
in Luce, the trial court offered “no analysis” at all, Luce at ¶ 8, and even in our remand,
we did not instruct the trial court to prepare findings of fact. It is difficult to use Luce
as a springboard to the findings of fact rule that defendants invite us to embrace when
it never mentions the point.
{¶22} This brings us to another difference; the appellants in Luce explicitly
challenged the merits of the trial court’s disqualification decision. In addressing this
challenge in Luce, this court tied the trial court’s failure to produce a sufficient Dana
analysis to its inability to conduct meaningful review. See Luce, 10th Dist. Franklin
No. 04AP-1250, 2005-Ohio-3373, at ¶ 8 (“Because there is no analysis, we are unable
to conduct a meaningful review of the trial court’s decision[.]”). Although defendants
in this case touch on the merits in their appellate brief, they limit their assignment of
error to the procedural flaws (i.e., lack of an evidentiary hearing and absence of
findings of fact), and they only seek a remand to enable the trial court to properly
convene a hearing and issue findings of fact.
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OHIO TENTH DISTRICT COURT OF APPEALS
{¶23} Because defendants here never requested findings of fact, we
accordingly find no error in the trial court’s failure to issue findings of fact below. We
must also be mindful of the often strategic nature of disqualification motions—and
recognizing a rule such as defendants envision could reward manipulative behavior
while inflicting unnecessary delay. See Wynveen v. Corsaro, 2017-Ohio-9170, 106
N.E.3d 130, ¶ 16 (8th Dist.) (“ ‘While motions to disqualify may be legitimate and
necessary under certain circumstances, they should be viewed with extreme caution
as they can be misused as techniques of harassment.’ ”); Fordeley v. Fordeley, 11th
Dist. Trumbull No. 2014-T-0079, 2015-Ohio-2610, ¶ 25, quoting Waliszewski v.
Caravona Builders, Inc., 127 Ohio App.3d 429, 433, 713 N.E.2d 65 (9th Dist.1998)
(warning that “because of the potential use of the advocate-witness rule for abuse,
disqualification ‘is a drastic measure which should not be imposed unless absolutely
necessary.’ ”). Specifically, to excuse the defendants’ waiver here would in effect
condone a strategy by which a party might purposefully elect not to request findings
of fact, knowing full well that if the trial court declined to issue them, that party would
have a procedural mulligan at their disposal. That risks dragging out disqualification
matters (with superfluous appeals and remands), with likely attendant delay
consequences for the trial proceedings as well—all of which could be avoided if the
party did just what the Supreme Court said in Kala and “requested” the findings. We
are aware of no authority specifically excusing the failure to request findings of fact in
this context, and we decline to break that ground.
{¶24} For the forgoing reasons, we overrule the defendants’ sole assignment
of error, and accordingly affirm the judgment of the trial court.
Judgment affirmed.
MYERS, P.J., concurs.
CROUSE, J., concurs in part and dissents in part.
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Crouse, J., concurring in part and dissenting in part.
{¶25} While I concur with the majority’s holding that the trial court did not
err by failing to conduct an evidentiary hearing, I must dissent from the majority’s
holding that the trial court did not err in failing to support its disqualification decision
with findings of fact.
I.
{¶26} The majority agrees that Kala mandates an evidentiary hearing on so-
called “side-switching” cases like this one, but then holds Kala does not mandate
findings of fact unless they are requested by a party. However, the same sentence the
majority relies on to support its holding that a trial court is only mandated to issue
findings of fact “if requested” also states that “the court should hold an evidentiary
hearing on a motion to disqualify.” (Emphasis added.) Kala, 81 Ohio St.3d at 12, 688
N.E.2d 258. Does the use of the word “should” mean that an evidentiary hearing is
only suggested but not mandatory? The majority does not believe that to be the case,
and neither do I. Both the syllabus and the conclusion of Kala state that a court “must”
hold an evidentiary hearing. Furthermore, this court in Luce I held that an evidentiary
hearing is mandated in side-switching cases. Luce v. Alcox, 10th Dist. Franklin No.
04AP-1250, 2005-Ohio-3373, ¶ 6, citing Kala at 13 (“The only instance in which the
Supreme Court of Ohio has held that an evidentiary hearing is required is when ‘ruling
on a motion for disqualification of either an individual * * * or the entire firm * * *
when an attorney has left a law firm and joined a firm representing the opposing party.’
”).
{¶27} Specifically, with regard to why an evidentiary hearing and findings of
fact are so important, the Kala court explained a “request for disqualification implies
a charge of unethical conduct,” impacts an attorney or law firm’s “relationship with
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the client,” and calls into question “its good name, reputation and ethical standards.”
Kala at 12. Kala recognizes that disqualification of an attorney is a “drastic measure”
which should not be imposed unless “absolutely necessary.” Id. at 6; see Luce I at ¶ 5.
When an attorney or a law firm is disqualified from representing a client due to a
conflict of interest, such disqualification necessarily questions that attorney or law
firm’s ethics as a matter of public record. As discussed in Kala, “[A]n attorney’s and/or
law firm’s most valuable asset is their professional reputation for competence, and
above all honesty and integrity.” Kala at 12, quoting Analytica Inc. v. NPD Research,
Inc., 708 F.2d 1263, 1275 (7th Cir.1983) (Coffey, J., dissenting). For this reason, “a
summary disqualification order, based on a scant record * * * can do irreparable harm
to an attorney’s or law firm’s professional reputation.” Id.{¶28} Therefore, Kala held “in conclusion” that “in ruling on a motion for
disqualification of either an individual (primary disqualification) or the entire firm
(imputed disqualification) when an attorney has left a law firm and joined a firm
representing the opposing party, a court must hold an evidentiary hearing and issue
findings of fact using a three-part analysis * * *.” (Emphasis added.) Id. at 13.
{¶29} In addition to the conclusion, the Kala syllabus states, “a court must
hold an evidentiary hearing and issue findings of fact using a three-part analysis.”
(Emphasis added.) Id. at syllabus. Although the syllabus seems to conflict with the “if
requested” language cited by the majority, at the time Kala was decided, it was “well-
established that when a statement in a Supreme Court opinion conflicts with the rule
of law established in the syllabus, the syllabus controls.” State v. Terry, 171 Ohio
App.3d 473, 2007-Ohio-1096, 871 N.E.2d 634 (12th Dist.), citing Akers v. Serv-A-
Portion, Inc., 31 Ohio St.3d 78, 79, 508 N.E.2d 964 (1987). See former Rep.Op.R.
1(B)(2).
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{¶30} It is important to note that the sentence the majority relies on to justify
its holding that findings of fact are only mandatory “if requested” appears in the
section of the opinion titled “Additional Factors to Consider in Motions to Disqualify.”
This “if requested” language has clearly caused some confusion, but since it appears
nowhere in the syllabus or the conclusion, it should not be viewed as the law of the
case.
{¶31} I also note that both the Ohio Supreme Court and this court have cited
Kala as requiring the trial court to issue findings of fact regardless of a request from a
party. See Dayton Bar Assn. v. Parisi, 131 Ohio St.3d 345, 350, 2012-Ohio-879, 965
N.E.2d 268 (“We have held that a court must hold an evidentiary hearing and issue
findings of fact in ruling on a motion for disqualification of an individual or of an entire
firm when an attorney has left a law firm that represents one party to an action and
has joined a firm that represents an opposing party.” (Emphasis added.); see also
Green v. Toledo Hosp., 94 Ohio St.3d 480, 483, 764 N.E.2d 979 (2002) (“In ruling on
a motion for disqualification of either an individual (primary disqualification) or the
entire firm (imputed disqualification) when an attorney has left a law firm and joined
a firm representing the opposing party, a court must hold an evidentiary hearing and
issue findings of fact using a three-part analysis.”) (Emphasis added.); City of
Whitehall, Ohio v. Olander, 10th Dist. Franklin No. 15AP-1030, 2017-Ohio-2869, ¶ 26
(“In [Kala] the Supreme Court of Ohio held that ‘a court must hold an evidentiary
hearing and issue findings of fact in ruling on a motion for disqualification of an
individual or of an entire firm when an attorney has left a law firm that represents one
party to an action and has joined a firm that represents an opposing party.’ ”)
(Emphasis added.) Nowhere in those opinions does this court or the Ohio Supreme
Court quote the “if requested” language.
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OHIO TENTH DISTRICT COURT OF APPEALS
II.
{¶32} With regard to the evidentiary-hearing issue, I disagree with the
majority’s contention that the defendants waived their evidentiary-hearing challenge
on appeal. Mr. Starner’s motion to disqualify was titled, “Motion to Disqualify All
Defense Counsel And Request for Evidentiary Hearing (And Motion to Continue
Trial).” Mr. Melick’s memorandum in opposition was simply titled, “Memorandum
Contra Plaintiff’s Motion to Disqualify All Defense Counsel and Request for
Evidentiary Hearing (And Motion to Continue Trial).” In his memorandum contra,
Mr. Melick never specifically opposed the request for an evidentiary hearing. Rather
he opposed the motion to disqualify in general, arguing that Mr. Starner did not meet
his burden to show a “substantial relationship” with a prior matter, and even if he
could show a substantial relationship, Mr. Alden had been effectively “screened” from
the other LNL attorneys so that no confidential information about Mr. Starner was or
will be disclosed. Mr. Melick’s attached affidavit attempted to support LNL’s
screening measures and overcome the rebuttable presumption of shared confidences
by stating that he did not receive any such information. Mr. Melick’s memorandum
contra argued that because Mr. Starner did not meet his initial burden, the motion to
disqualify must be denied. Accordingly, I would not find that Mr. Melick or LNL
waived an evidentiary hearing.
{¶33} However, I do agree with the majority that the defendants actually did
receive a hearing on the disqualification motion and have not shown any prejudice
resulting from the court’s failure to hold an “evidentiary hearing.” The point of the
hearing requirement is to give the challenged firm “an opportunity to defend not only
its relationship with its client, but also its good name, reputation and ethical
standards.” Kala, 81 Ohio St.3d at 12, 688 N.E.2d 258. Mr. Melick and his law firm
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OHIO TENTH DISTRICT COURT OF APPEALS
were given this opportunity. Although the hearing was not an “evidentiary hearing,”
it was a hearing on the merits of the motion. The defendants never asked for a
continuance or claimed they wished to present additional evidence or witness
testimony. And Mr. Melick, while not under oath, was able to present his “testimony”
to the court as an officer of the court. Therefore, the trial court fulfilled its hearing
requirement in this case.
III.
{¶34} Nevertheless, I would sustain Appellants’ assignment of error because I
agree that the trial court abused its discretion in disqualifying Mr. Melick and LNL
without issuing findings of fact substantiating its decision.
{¶35} Although Mr. Johnson brought LNL into the underlying litigation less
than one month before the scheduled trial date, it is important to remember that
attorneys from LNL had been representing Mr. Johnson and 1212 Capital LLC for
years, including in several of Mr. Starner’s previous lawsuits. Mr. Johnson clearly
wanted his long-time attorneys involved in the underlying litigation. And just as Mr.
Starner’s right to protect attorney-client privileged information is important, so is Mr.
Johnson’s right to have counsel of his choice to represent him. As set forth in City of
Cleveland v. Cleveland Elec. Illuminating Co., 440 F. Supp. 193, 195-196 (N.D.Ohio
1976), aff'd sub nom. City of Cleveland v. Cleveland Elec. Illuminating, 573 F.2d 1310(6th Cir.1977):
Issues of disqualification of counsel for conflicts arising as a result of
former representation present the acutely sensitive dilemma of
protecting the confidentiality of the client-attorney relationship without
needlessly interfering with a litigant’s freedom to proceed with legal
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OHIO TENTH DISTRICT COURT OF APPEALS
counsel of choice. An equitable balance of these competing interests is
essential if the public’s trust in the integrity of the Bar is to be preserved.
{¶36} Mr. Melick, as an officer of the court, represented that he received
absolutely no information from Mr. Alden about his prior representation of Mr.
Starner. And importantly, the trial court unequivocally believed him. At the hearing,
the court stated:
Mr. Melick * * * I take you at your word that you haven’t had any contact,
you’ve avoided discussing the matter with John Alden, but I think to
protect the integrity of the trial and to avoid even an appearance of a
conflict, I am going to, pursuant to Rule 1.9, have Luper Neidenthal * *
* removed as counsel and will not participate – any attorney, not just
you, but any attorney from the firm due to Mr. Alden’s continuing work
with * * * your firm. And I * * * want you to know, like, it’s not – I don’t
think you’re being honest. I absolutely believe you when you state your
word. It’ just the appearance of the conflict * * *.
{¶37} Thus, the only reason the court gave for disqualifying Mr. Melick and
LNL was based on the appearance of impropriety and a finding that LNL violated
Prof.Cond.R. 1.9.1 While Kala does state that sometimes the appearance of
impropriety will be impossible to overcome, it still requires a trial court to engage in
the three-part analysis and issue findings of fact. Kala at 13. See Cargould v.
Manning, 10th Dist. Franklin No. 09AP-194, 2009-Ohio-5853, ¶ 10 (finding that
violation of a rule of professional conduct does not necessarily warrant disqualification
1 I note that Prof.Cond.R. 1.9 is titled “Duties to Former Clients.” There is a dispute in this case as
to whether Mr. Starner was a current client of Mr. Alden at the time of the motion to disqualify or
whether he was a former client. While the trial court did not make a specific finding on the issue,
it only referred to the Rule of Professional Conduct dealing with former clients in its disqualification
decision.
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OHIO TENTH DISTRICT COURT OF APPEALS
of a lawyer in pending litigation and “the rules simply provide a framework for the
ethical practice of law.”).
{¶38} In creating the three-part analysis, the Kala court specifically rejected
the “appearance of impropriety doctrine” and held that “the fairer rule in balancing
the interests of the parties and the public is to allow the presumption of shared
confidences with members of the new firm to be rebutted.” Kala at 10. Therefore, in
a side-switching situation like the one in this case, even if there was a substantial
relationship between prior and present representation (which we are unsure if the trial
court found), the presumption of shared confidences becomes rebuttable. It appears
that the trial court here failed to understand that it had to engage in an analysis of
whether the presumption was rebutted when it stopped its analysis at the appearance
of impropriety.
{¶39} Because the trial court did not issue findings of fact, or demonstrate that
it engaged in the three-part analysis, it is impossible for this court to review whether
disqualification was warranted and whether the appearance of impropriety was
impossible to overcome.
{¶40} The majority’s analysis seems to rise and fall with whether the
Appellants requested findings of fact. However, the assignment of error concerns not
only the court’s failure to issue findings of fact, but also the court’s failure to engage in
the three-part analysis required by Kala. Certainly the majority does not claim that a
trial court is not mandated to engage in the three-part Kala analysis unless requested?
The majority states, “Defendants seem to understand that, without such findings, they
lack a means of illustrating an abuse of discretion, which is why the procedural aspects
take center stage in their brief.” This is exactly the point. How is this court supposed
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OHIO TENTH DISTRICT COURT OF APPEALS
to review the trial court’s decision without findings? But the trial court is also required
to engage in the appropriate analysis. It did neither.
{¶41} This is exactly why the Appellants rely on Luce II to support their
argument that the trial court abused its discretion by not only failing to issue findings
of fact, but also failing to engage in the three-part Kala analysis. Sure, as the majority
points out, Luce was not a side-switching case, and therefore was not applying the law
set forth in Kala. And Luce did not specifically discuss whether “findings of fact” are
required since it was not analyzing the disqualification issue under the Kala factors.
But the real point of the Appellants’ citation to Luce II, is that because disqualification
is such a drastic remedy, a trial court must set forth its reasoning so that an appellate
court has the ability to review it for abuse of discretion. Without any analysis, “we are
unable to conduct a meaningful review of the trial court’s decision, as we are unable to
determine the factual and/or legal conclusions reached by the trial court, as well as
what the trial court relied upon in reaching its decision.” Luce v. Alcox, 165 Ohio
App.3d 742. 2006-Ohio-1209, 848 N.E.2d 552, ¶ 6 (10th Dist.), quoting Luce I at ¶ 8.
{¶42} I also think the majority’s concern about rewarding manipulative
behavior is overblown. A holding that findings of fact are mandatory in these types of
side-switching cases would not “condone a strategy by which a party might
purposefully elect not to request findings of fact, knowing full well that if the trial court
declined to issue them, that party would have a procedural mulligan at their disposal.”
As I discussed above, the Ohio Supreme Court has already held in Kala that findings
of fact and a specific three-part analysis are mandatory. The court has already
explained why a “summary disqualification order” is detrimental to the disqualified
attorney’s/law firm’s reputation and the public’s confidence in the legal profession.
Therefore, any court doing a proper analysis under Kala will know that it must issue
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OHIO TENTH DISTRICT COURT OF APPEALS
findings of fact and engage in the appropriate analysis, and that the failure to do so is
subject to reversal on appeal. Ensuring that the trial court engaged in an appropriate
disqualification analysis is just as much the court’s own responsibility as it is the
responsibility of the parties. Kala, 81 Ohio St.3d at 4, 688 N.E.2d 258 (“[A] court has
inherent authority to supervise members of the bar appearing before it; this
necessarily includes the power to disqualify counsel in specific cases. * * * [I]t is the
trial court’s duty to safeguard the preservation of the attorney-client relationship.”).
{¶43} Accordingly, I would hold that while the trial court did not abuse its
discretion in failing to conduct an “evidentiary hearing,” the trial court did abuse its
discretion by failing to issue findings of fact and engage in the three-part analysis set
forth in Kala. I would reverse the trial court’s judgment and remand this matter to
the trial court to issue the mandatory findings of fact and to engage in the appropriate
Kala analysis as to whether disqualification is warranted in this particular case.
{¶44} For these reasons, I respectfully dissent.
Please note:
The court has recorded its entry on the date of the release of this opinion.
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