Fenzel v. Group2 Software, LLC et al

Filing 80

MEMORANDUM OPINION. Signed by Judge Deborah K. Chasanow on 12/29/2014. (sat, Chambers)

IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF MARYLAND
:
JERRY FENZEL
:
v.

:

Civil Action No. DKC 13-0379

:
GROUP2 SOFTWARE, LLC ET AL
:

MEMORANDUM OPINION
Presently pending and ready for resolution in this breach
of contract action is the motion of Plaintiff Jerry Fenzel to
disqualify Defendants’ counsel, the law firm of Shulman, Rogers,
Gandal, Pordy & Ecker, P.A (“Shulman Rogers”), and to reopen
discovery.

The issues have been fully briefed, and the court

now rules, no hearing being deemed necessary.
For

the

following

reasons,

Plaintiff’s

Local Rule 105.6.

motion

to

disqualify

Defendants’ counsel and reopen discovery will be denied.
I.

Background
A.

Factual Background

Plaintiff Jerry Fenzel met attorney Larry Shulman in 2006,
when Mr. Shulman asked Plaintiff to serve on a non-profit board
with him.
into

a

(ECF No. 73-3 ¶ 3).

retainer

agreement

In June 2010, Plaintiff entered

with

Shulman

Rogers

and

paid

a

retainer fee of $1,500 in connection with the collection of
monies owed to Plaintiff by Airtime Management, Inc. (“Airtime

collection matter”).
Rogers

(“Rogers”),

(ECF No. 73-5).
a

partner

with

In November 2010, Don

Shulman

Rogers,

informed

Plaintiff about a potential opportunity to work as the Chief
Executive officer (“CEO”) of Group2 Software, LLC (“Group2”),
which

is

owned

“Defendants”).

by

Thomas

Bowen

(“Bowen”)

(collectively,

(ECF No. 73-3 ¶ 4).

Several attorneys from Shulman Rogers, including Don Rogers
and

Robert

preparation

Bartlett,
of

an

participated

employment

in

the

contract

negotiation

between

Group2

and
and

Plaintiff (the “Consulting Agreement”), which led to Plaintiff
accepting the position as a contract CEO of Group2.
73-3 ¶ 4).

(ECF No.

In April 2011, Shulman Rogers prepared a waiver of

conflicts agreement and emailed it to the parties; it stated
that

Plaintiff

and

Thomas

Bowen

of

Group2

were

waiving

any

conflicts in order for Shulman Rogers to represent Plaintiff and
Group2

in

Agreement.
conflict

the

negotiation

and

execution

of

the

Consulting

Neither Plaintiff nor Defendant Bowen signed the

waiver

agreement,

however.

Plaintiff

did

not

have

assistance from other counsel in connection with the negotiation
and execution of the Consulting Agreement.1

1

Plaintiff alleges that he believed Shulman Rogers was
representing him and Group2 in the transaction, while Defendants
argue that Plaintiff, an attorney, communicated to Rogers that
he was representing himself in the matter to save money.
2

Plaintiff served as Group2’s CEO from 2011 until May 2012,
when a dispute arose between Plaintiff and Thomas Bowen and
Plaintiff’s employment relationship was terminated.
B.

Procedural Background

Plaintiff filed his original complaint in the Circuit Court
for

Prince

George’s

County

alleging

breach

of

contract

and

related claims against both Defendants.

On February 4, 2013,

Group2

Rogers,

Software,

represented

by

Shulman

removed

this

case to the United States District Court for the District of
Maryland.

(ECF No. 1).

On December 23, 2013, after Mr. Bowen

was served, Defendant Group2 filed a motion for a preliminary
injunction (ECF No. 33), and Defendant Mr. Bowen filed a motion
to dismiss.

A motions hearing was held on February 12, 2014, at

which the motion for a preliminary injunction was denied and the
motion to dismiss was deferred.

(ECF No. 38).

A scheduling

order was entered on February 12, 2014, setting the following
deadlines:

Plaintiff’s amended complaint was due by March 7,

2014, discovery was to close on July 25, 2014, and motions were
due by August 25, 2014.

(ECF No. 39).

Extensions of those

deadlines subsequently were granted.
Plaintiff’s current attorney, Philip Zipin, filed a notice
of appearance on September 26, 2014.

(ECF NO. 70).

On October

14, 2014, after discovery closed, Plaintiff’s new counsel filed
a motion to disqualify Defendants’ counsel, Shulman Rogers, and
3

to reopen discovery in order to depose several Shulman Rogers
attorneys.2

(ECF No. 73).

October

2014

31,

(ECF No. 76).

and

Defendants filed an opposition on

requested

sanctions

against

Plaintiff.
(ECF No.

Defendants filed a surreply on December 1, 2014.

77).

Plaintiff replied on November 12, 2014.

(ECF No.

79).
II.

Standard of Review
As explained in Penn Mutual Life Ins. Co. v. Berck, No. DKC

09-0578, 2010 WL 3294309, at *3 (D.Md. Aug. 20, 2010):
A motion to disqualify is a ‘serious
matter,’ Plant Genetic Systems [N.V. v. Ciba
Seeds], 933 F.Supp. 514,] at 517 [(M.D.N.C.
1996)], which must be decided on a case-bycase basis. See Buckley v. Airshield Corp.,
908 F.Supp. 299, 304 (D.Md. 1995). This is
so because two significant interests are
implicated by a disqualification motion:
‘the client’s free choice of counsel and the
maintenance of the highest ethical and
professional
standards
in
the
legal
community.’
Tessier [v. Plastic Surgery
Specialists, Inc.], 731 F.Supp. 724] at 729
[(E.D.Va. 1990)]; Buckley, 908 F.Supp. at
304.
Nevertheless, ‘the guiding principle
in
considering
a
motion
to
disqualify
counsel is safeguarding the integrity of the
court proceedings.’
Plant Genetic Systems,
933 F.Supp. at 517; see Hull v. Celanese
Corporation, 513 F.2d 568, 572 (2d Cir.
2

Defendants filed a consent motion for an extension of time
to file dispositive motions and to stay proceedings until after
a ruling on Plaintiff’s motion to disqualify and reopen
discovery is decided.
(ECF No. 74).
The court granted the
motion for extension of time and directed the parties to submit
a proposed schedule thirty days after the court rules on the
motion to disqualify counsel. (ECF No. 75).
4

1975) (finding that a party’s free choice of
counsel must yield to ‘considerations of
ethics which run to the very integrity of
our judicial process.’). Thus, this court
must not weigh the competing issues ‘with
hair-splitting nicety but, in the proper
exercise of its supervisory power over the
members of the bar and with a view of
preventing an appearance of impropriety,
[this Court] is to resolve all doubts in
favor of disqualification.’
United States
v. Clarkson, 567 F.2d 270, 273 n.3 (4th Cir.
1977)
(internal
quotation
marks
and
citations omitted); Rogers v. Pittston Co.,
800
F.Supp.
350,
353
(W.D.Va.
1992);
Buckley, 908 F.Supp. at 304.
Id.

(quoting

Zachair,

Ltd.

v.

Driggs,

965

F.Supp.

741,

750

(D.Md. 1997)). Because disqualification necessarily results in
the drastic result of a party losing its freely-chosen counsel,
the

movant

“bear[s]

disqualification

is

‘a

high

standard

warranted.’”

of

proof

Franklin

v.

to

show

that

Clark,

454

F.Supp.2d 356, 364 (D.Md. 2006) (quoting Buckley, 908 F.Supp. at
304); see also Aetna Cas. & Surety Co. v. United States, 570
F.2d 1197, 1200-01 (4th Cir. 1978) (requiring that the district
court

find

that

speculative

there

conflict

is

an

“actual

before

conflict”

disqualifying

not

just

a

counsel).

Accordingly, the movant has the burden of proof as to all facts
necessary to show the rule of professional conduct that requires
the attorney’s disqualification.
Cas. Ins. Co. v. Perlberg,
2011)

(after

reviewing

See Pennsylvania Nat’l Mut.

819 F.Supp.2d 449, 454-55 (D.Md.

movant’s

5

evidence

in

support

of

its

motion to disqualify under Rule 1.9, finding that the movant
“has not satisfied the high burden of proof necessary to sustain
a disqualification motion in showing it stood in an attorneyclient relationship” with opposing counsel) (emphases added);
see also Victors v. Kronmiller, 553 F.Supp.2d 533, 552-53 (D.Md.
2008) (denying movant’s motion for disqualification because the
movant failed conclusively to establish a conflict under Rule
1.9);3 cf. City of Cleveland v. Cleveland Elec. Illuminating Co.,
440

F.Supp.

party’s

193,

burden

evidentiary

207
as

(N.D.Ohio

being

hurdles”

1976)

“imposed

provided

by

(describing

by
the

several

the

moving

interrelated

operative

rule

of

professional conduct).
There is no set procedure for assessing a disqualification
motion; rather, “the method of conducting the inquiry is within
the discretion of the judge[.]”

United States v. Philip Morris

Inc., 312 F.Supp.2d 27, 34 (D.D.C. 2004), vacated in part on
other grounds, 220 F.R.D. 109 (2004) (quoting Lefrak v. Arabian
Am.

Oil

Co.,

527

F.2d

1136,

3

1140

(2d

Cir.

1975)).

An

In Victors, after reviewing the movant’s evidence relevant
to each element of Rule 1.9, Judge Motz noted that: “(1) it is
dubious whether an attorney-client relationship existed [], (2)
the matter at issue in the prior representation is not the same
or substantially related to the challenged representation, and
(3) the probability is low that confidences from the prior
representation could be used [] in the current litigation,
[thus,] I deny [movant’s] motion to disqualify plaintiffs’
counsel.”
6

evidentiary hearing is not required, as long as the trial court
determines
review.

that

there

is

an

adequate

record

for

appellate

See In re Modanlo, 342 B.R. 230, 233-34 (2006) (citing

Philip Morris, 312 F.Supp.2d at 34-35) (“[A]s long as the trial
court

concludes

that

there

will

be

an

adequate

record

for

appellate review, whether in the form of affidavits, documents,
or submissions in camera, the court may in its discretion decide
whether

discovery

[or

a

hearing]

is

[]

warranted

or

inappropriate.”).
III. Analysis
The Maryland Rules of Professional Conduct (“MRPC”), which
have been adopted by the Court of Appeals of Maryland, apply to
disputes involving attorney conduct.
argues

that

Shulman

Rogers

Local Rule 704.

should

be

Plaintiff

disqualified

from

representing Thomas Bowen and Group2 because the representation
violates Rules 1.7, 1.9, and 3.7 of the MRPC.

Defendants argue

that Plaintiff’s motion is factually unfounded and is merely “an
untimely,

tactical

attorney

to

discovery[.]”
A.

attempt

delay

this

by

Plaintiff’s

matter

and

now

fourth

improperly

(4th)
reopen

(ECF No. 76, at 1).

Waiver Due to Delay

Defendants argue that Plaintiff has waived any conflict of
interest because he was aware of “the alleged conflict in June
2012, but waited nearly [two and a half] years to bring the
7

instant motion.”

(ECF No. 76, at 2).

Defendants cite Gross v.

SES Americom, Inc., 307 F.Supp.2d 719, 723-24 (D.Md. 2004), for
the proposition that a movant waives any conflict of interest if
it fails to raise the conflict for a significant period after
litigation

has

begun.

Defendants

contend

that

“[f]iling

a

motion now, after the close of discovery, after attendance at
mediation, after pending litigation for almost 30 months, is a
blatant,

strategic

attempt

to

attempt to reopen discovery.”
Plaintiff

responds

delay

the

instant

matter

and

(ECF No. 76, at 2).

that

“‘[t]imeliness’

is

a

context

specific legal concept[,]” and that in the context of this case,
the

motion

to

disqualify

is

timely.

(ECF

No.

77,

at

1).

Plaintiff’s counsel asserts that he made this motion “as soon as
practicable”
Defendants,

after

he

which

representation

of

reviewed

clarified

the

“the

Plaintiff[.]”

documents

full
(Id.

range
at

produced

of

2).

the
In

by

Firm’s

addition,

Plaintiff argues that disqualification will not unduly prejudice
Defendants as most of what has occurred in this case to date has
been

procedural

rather

than

substantive.

Plaintiff’s

new

counsel adds that Shulman Rogers “was made well aware of this
ethical

problem

withdraw.

from

Actions

the
by

outset

of

Plaintiff’s

the
prior

case,

yet

counsel

failed
in

no

absolve the Firm of its ethical duty to avoid conflicts.”
at 3).
8

to
way

(Id.

Although
determining

delay

is

an

important

whether

to

grant

a

factor

motion

to

to

consider

disqualify,

in

delay

alone, without consideration of the movant’s reasons for delay,
is not a sufficient reason to deny a motion.

As Judge Williams

aptly noted in Buckley v. Airshield Corp., 908 F.Supp. 299, 308
(D.Md. 1995), “there are no specific rules governing challenges
based on timeliness.
responsibility

of

This Court will not avoid its ‘duty and

supervising

the

conduct

of

attorneys

who

appear before it’ solely because a party delayed in raising the
disqualification issue.”
Buckley

court

listed

Id. (internal citations omitted).

several

relevant

factors

courts

The

should

consider when determining whether a movant has waived his right
to contest the representation of an opposing party, including:
(1) “when the movant learned of the conflict;” (2) “whether the
movant was represented by counsel during the delay;” (3) “why
the delay occurred, and, in particular, whether the motion was
delayed for tactical reasons;” and (4) “whether disqualification
would result in prejudice to the nonmoving party.”
F.Supp. at 307.
requiring

that

Buckley, 908

These factors encompass the primary reasons for
parties

timely

serve

a

motion

to

disqualify:

“curbing the potential of abuse of disqualification motions as a
harassing

or

strategical

tactic

effects to the opposing party.”

and

Id.

9

reducing

the

detrimental

Plaintiff’s delay in filing the motion to disqualify is
significant — Plaintiff waited nearly two years after this case
was removed to this court to file this motion.
Modanlo,

342

B.R.

230,

236-38

(finding

that

See
the

In re

movant’s

conflict of interest allegations were waived because he waited
more than five months after learning of the conflict to file his
motion); see also Gross, 307 F.Supp.2d at 723-24 (finding that
the movant had waived its right to raise conflict allegations
when

it

was

negotiations

aware

of

the

conflict

during

preceding

the

lawsuit,

but

the

two

failed

years

to

file

of
the

motion to disqualify counsel until a year after the complaint
was

filed);

see

also

Reed

v.

Baltimore

Life

Ins.

Co.,

127

Md.App. 536, 563-64 (1999) (finding that the district court did
not

abuse

disqualify
opposing

its

discretion

opposing

counsel’s

counsel
conflict

by

denying

when
for

movant’s

movant
one

year

was

motion

aware

before

to

of

the

filing

its

motion).
Most, if not all, of the
disqualification.

First,

Buckley

Plaintiff

factors weigh against
has

known

about

this

conflict from the day he filed the case, as he was aware that
Shulman Rogers drafted the Consulting Agreement and that they
would be representing Defendants.

Second, Plaintiff has been

continuously represented (albeit disjointedly) by counsel, who
could have raised this issue at the start of the case.
10

Indeed,

Plaintiff admits that he was aware of this alleged conflict from
the outset of this case and raised it with Shulman Rogers as
early as July 2012 and allegedly asked that the firm withdraw.
(ECF No. 77, at 3).
Plaintiff

that

instructed

Shulman Rogers refused, disagreeing with

there

Plaintiff

was
to

a

conflict,

file

thought it was necessary.

a

and

motion

to

at

that

disqualify

(ECF No. 76, at 14).

point
if

he

Plaintiff did

not do so at that time.
Third,
Plaintiff

Plaintiff’s
alleges

that

reason
his

for

delay

delay
in

is

not

filing

the

persuasive.
motion

to

disqualify was due to the fact that he did not have enough
evidence prior to discovery to support the motion:

“prior to

receiving the April 5, 2011 conflict waiver letter such a motion
would have been premature, as definitive evidence from the Firm
itself that an attorney-client relationship existed between the
Firm

and

Plaintiff

at

Agreement was lacking.”
that

discovery

revealed

the

time

of

the

May

(ECF No. 77, at 7).
several

1

[Consulting]

Plaintiff argues

communications

that

support

disqualification, and thus, his motion is not untimely because
discovery just closed in August 2014.

Plaintiff’s timeliness

argument is undercut, however, by his admission that he received
and responded to an email from Shulman Rogers in April 2011 that
included a draft of the Consulting Agreement and the conflicts
waiver.

(ECF No. 73-1, at 3).
11

Moreover, if all movants were

permitted to wait until they have what they consider conclusive
evidence to file a disqualification motion, it would encourage
delays.

Although it is not readily apparent that this motion

was filed purely for strategic reasons to harass Defendants, the
timing is suspect.
that

Shulman

Logically, if Plaintiff strongly believed

Rogers’

representation

of

Defendants

created

a

disqualifying conflict that would potentially harm his case, he
would have raised this issue promptly to avoid injustice and
better

his

certainly

chances

be

of

success.

prejudiced

if

they

Finally,
are

Defendants

required

to

will

hire

new

counsel, as a significant amount of time has already been spent
litigating this case.
counsel,
would

this

have

case

to

pay

If Defendants were forced to hire new

would
for

be

further

duplicative

delayed,

legal

counsel to get up to speed on this case.
has

waived

his

right

to

challenge

work

and

Defendants

for

their

new

Accordingly, Plaintiff

this

conflict.

Even

if

Plaintiff’s motion was timely, however, Plaintiff not met his
burden of showing that disqualification is necessary in this
case, as discussed below.
B.

Rule 1.7:
Client

Plaintiff
Defendants

argues

violates

Conflicts

that
MRPC

of

Interest

Shulman

Rogers’

1.7

because

it

with

an

Existing

representation
is

a

conflict

of
of

interest for an attorney to sue an existing client on behalf of

12

another

client.

Plaintiff

alleges

that

he

believed

Shulman

Rogers was “acting as his counsel” during the negotiation and
drafting of the Consulting Agreement and he relied on the firm’s
guidance.
April

5,

following

He argues that Shulman Rogers acknowledged in its
2011

conflicts

negotiations

waiver

with

letter,

Defendants,

Group2 were existing clients.

which
that

was

produced

Plaintiff

and

According to Plaintiff, because

he was a current client at the time of the negotiation of the
Consulting
prohibited

Agreement
under

Rule

with
1.7

Defendants,
from

choosing

Shulman
sides

Rogers

is

between

its

clients and representing Group2, whose interests are directly
adverse to Plaintiff’s interests.4

4

Plaintiff also argues that Shulman Rogers’ representation
of Defendants violates Rule 1.13(e) because a corporate lawyer
may not represent the interests of one owner against another
owner as it violates the general conflict of interest provision
in Rule 1.7. (ECF No. 73-1, at 9-12). Plaintiff asserts that
he is the de facto owner of Group2, as he has allegedly passed
the one-year mark of his employment agreement, which entitles
him to a 15% ownership interest in Group2.
Shulman Rogers
argues that Plaintiff does not own Group2, and the case law he
cites in support of this argument only pertains to current
owners or partners, not employees with potential claims to
ownership rights.
(ECF No. 76, at 22).
Shulman Rogers also
contends that “in the absence of an agreement by the parties to
the contrary, counsel providing legal advice to an entity is not
acting as counsel for its officers, directors, members or
employees.” (ECF No. 76, at 14). It asserts that while counsel
representing an organization may also represent its officers and
directors, such representation is only permitted with the
organization’s consent, and Group2 never provided such consent
to Plaintiff.
13

In

response,

represent

Shulman

Plaintiff

Consulting
attorney,

in

Agreement;
decided

to

the

Rogers

argues

negotiation

rather,

Plaintiff,

represent

himself

that

and
a
in

it

drafting
licensed
the

did

not

of

the

Maryland

negotiation

process, which Defendants allege is clear from the language used
in the communications between the parties, both in emails and
documents.

(ECF No. 76, at 3).

Defendants’ counsel asserts

that the conflicts waiver letter drafted on April 5, 2011, was
not intended to allow Shulman Rogers to represent both Plaintiff
and Defendants in the negotiation; rather, it was intended “to
waive potential conflicts of prior, unrelated matters for each
party, specifically for the Airtime collection matter relating
to Plaintiff.

Importantly, neither Plaintiff, nor Mr. Bowen

signed the ‘conflict waiver’ letter, as it was discovered and
confirmed that Plaintiff no longer had any pending matters with
Shulman Rogers.”

(ECF NO. 76, at 4).

Shulman Rogers adds that

the fact it never billed Plaintiff for the Consulting Agreement,
while it did bill Thomas Bowen, evidences that the firm only
represented

Defendants

during

the

negotiation

and

drafting

process and not Plaintiff.

Plaintiff’s argument regarding the firm’s violation of MRPC
1.13(e) is unavailing, as it relies on the improper premise
(discussed below) that an attorney-client relationship existed
between Plaintiff and Shulman Rogers.
14

MRPC 1.7 states, in relevant part, that “a lawyer shall not
represent a client if the representation involves a conflict of
interest.

A

conflict

of

interest

exists

if

.

.

.

the

representation of one client will be directly adverse to another
client.”

MRPC 1.7(a)(1).

“[l]oyalty

to

representation
client’s

Comment 6 to Rule 1.7 clarifies that

current
directly

informed

clients

adverse

consent.”

to

prohibits
that

client

Plaintiff’s

undertaking
without

argument

that

regarding

Shulman Rogers’ violation of Rule 1.7 depends on establishing
that he: (1) is presently a current client of Shulman Rogers, or
(2) was a current client of the firm in May or June of 2012 when
the

dispute

over

the

Consulting

Agreement

arose

and

Shulman

Rogers stepped in to represent Group2 and Thomas Bowen in the
dispute.
In Pennsylvania Nat’l Mut. Cas. Ins. Co. v. Perlberg, 819
F.Supp.2d 449, 453-54 (D.Md. 2011), a case involving a motion to
disqualify

based

on

MRPC

1.9,

Judge

Blake

discussed

what

constitutes an attorney-client relationship under Maryland law:
The
Maryland
Court
of
Appeals
has
“acknowledge[d]
that
determining
‘what
constitutes an attorney-client relationship
is a rather elusive concept.’”
Attorney
Grievance Comm’n v. Shoup, 410 Md. 462, 979
A.2d 120, 135 (2009) (quoting Attorney
Grievance Comm’n v. Shaw, 354 Md. 636, 732
A.2d 876, 883 (1999)).
Such a relationship
may arise through an explicit agreement or
“by implication from a client’s reasonable
expectation of legal representation and the
15

attorney’s
failure
to
dispel
those
expectations.” Attorney Grievance Comm’n v.
Brooke, 374 Md. 155, 821 A.2d 414, 425
(2003).
In other contexts, it has been noted that “an attorney-client
relationship can be implied from the conduct of the parties,
such conduct must evidence an offer or request by the client for
legal services and an acceptance of the offer by the attorney.”
See Wong v. Aragona, 815 F.Supp. 889, 896 (D.Md. 1993) (quoting
Stainton v. Tarantino, 637 F.Supp. 1051, 1066 (E.D.Pa. 1986)
(internal quotation marks omitted)) (proving the existence of an
attorney-client relationship in a legal malpractice claim); see
also Davis v. York Int’l Corp., No. HAR 92-3545, 1993 WL 180224,
at

*1-2

(D.Md.

May

24,

1993)

(noting

that

the

subjective

approach in determining whether an attorney-client relationship
exists

requires

courts

to

look

“to

the

nature

of

the

work

performed and to the circumstances under which the confidences
were divulged” and “an attorney-client relationship is said to
exist when the party divulging confidences . . . believes that
he is approaching the attorney in a professional capacity with
the intent to secure legal advice”).
Plaintiff

has

not

produced

evidence

to

establish

the

existence of an attorney-client relationship between himself and
Shulman Rogers in May and June 2012, when the dispute arose
between

Plaintiff

and

Defendants.

16

Indeed,

the

email

correspondence

provided

dispute

between

arose

by

the

Group2’s

parties
owner

shows
and

when

Plaintiff,

Rogers was not serving as Plaintiff’s counsel.
and 76-7).

that,

the

Shulman

(ECF Nos. 73-10

In Plaintiff’s July 10, 2012 email to Mr. Rogers of

Shulman Rogers, Plaintiff implicitly acknowledges that the firm
is solely representing Defendants’ interests, by stating “you
guys

blew

it

when

you

advised

your

client

to

arrangement with Group2 as of May 24, 2012.”
(emphasis added).

terminate

my

(ECF NO. 76-7)

Plaintiff also states in this email: “I don’t

take lightly being accused and screwed by lawyers who were my
friends and are fellow members of the Bar; who advised their
client

not

added).

to

pay

me

Plaintiff’s

my
own

pauper

wages[.]”

statements

reveal

(Id.)
that

(emphasis

he

did

not

reasonably believe Shulman Rogers was representing his interests
at

this

time,

as

he

uses

the

pronouns

your

and

their,

acknowledging his understanding that Shulman Rogers is serving
his

opponents’

interests

as

their

counsel.

Plaintiff

also

received an email from Mr. Etelson5 on May 24, 2012, noting that
Mr. Etelson had spoken with Thomas Bowen regarding the recent
dispute, and stating that “Thom believes it is best that your
consulting with Group2 end.

He sent you the below email and

what he states therein stands.”

5

(ECF No. 73-10).

Mr. Etelson’s

Mr. Etelson is counsel of record in this lawsuit.
17

statements firmly advocate for Group2’s position, and confirm
that he is stepping into the dispute on behalf of his clients,
Group2 and Thomas Bowen.6

No reasonable person, and especially

an

training,

attorney

with

legal

could

conclude

from

Mr.

Etelson’s statements — or Plaintiff’s own statements for that
matter

—

that

representing

either

party

Plaintiff.

believed

Shulman

Furthermore,

reasonably believe that he is

presently

Rogers

Plaintiff

was

cannot

a client of Shulman

Rogers when they have been representing his adversary in this
litigation for two years, and has disclaimed representing him
since 2012.

Plaintiff has not met his burden of proving that

Defendants must be disqualified based on a violation of MPRC 1.7
because he has not produced any evidence establishing that an
attorney-client
believed

that

relationship
he

was

a

existed

client

of

or

that

Shulman

he

Rogers

reasonably
when

this

dispute arose.
C.

Rule 1.9:

Conflict of Interest with a Former Client

In the alternative, Plaintiff argues that even if the court
concludes that he is not an existing client of Shulman Rogers,
6

Plaintiff also asserts that he rented space from the firm
and that the firm sent him a few documents from the Maryland
Department of Assessments and Taxation’s website. Just because
Plaintiff rented office space from Shulman Rogers and maintained
some communications with the firm during 2011, however, does not
indicate that an attorney-client relationship exists. Plaintiff
has not produced any communications with the firm or bills from
the firm, indicating that he engaged Shulman Rogers for legal
advice following the Airtime collection matter in 2010.
18

he is a former client of the firm; accordingly, he contends that
the

firm

is

Defendants

—

prohibited
whose

under

Rule

interests

1.9

are

from

representing

materially

adverse

to

Plaintiff’s — in matters that are the same or substantially
related

to

represented
contends

the

matter

in

Plaintiff.

that

Shulman

which

(ECF

Shulman

No.

Rogers

73-1,

provided

Rogers
at

previously

7).

him

Plaintiff

advice

in

the

negotiation of the Consulting Agreement with Group2, which is
the subject matter of this litigation.

In addition, Plaintiff

argues that this conflict is imputed to the entire law firm
under

Rule

1.10,

disqualifying

all

attorneys

from

Shulman

Rogers, not just the attorneys who previously were involved in
the

drafting

Although
Plaintiff
interest
Agreement
waiver.

and

Shulman

negotiation
Rogers

maintains
in

the

and

that

produced
he

negotiation

that

there

of

is

the
a

never
and
no

Consulting

conflict
waived

execution
written

waiver

the
of

Agreement.
letter,

conflict

the

of

Consulting

confirmation

of

his

Furthermore, Plaintiff asserts that even if he waived

the conflict with respect to the firm’s initial negotiation and
execution of the Consulting Agreement, he has not waived the
conflict regarding Shulman Rogers’ representation of Defendants
in this litigation.
Defendants respond that Shulman Rogers’ only representation
of Plaintiff has been in the Airtime collection matter, which
19

concluded

in

2010

and

Consulting Agreement.
confidential
adversely

is

the

unrelated

to

the

Group2

The firm could not have obtained any

information

in

wholly

about

present

Plaintiff

matter.

that

(ECF

could

be

used

76,

at

19).

No.

Furthermore, Plaintiff could not have reasonably believed that
Shulman Rogers was acting as his counsel in May 2011 or May 2012
in connection with the Consulting Agreement with Group2, when it
had not given him any legal advice since the Airtime collection
matter

ended

in

September

2010.

Defendants

state

that

Plaintiff, a licensed Maryland attorney, who is familiar with
the

rules

for

attorney-client

relationships

is

trying

to

“manufacture an argument that he had an ongoing ‘relationship’
with Shulman Rogers[.]”

(ECF No. 76, at 5).

Defendants assert

that Plaintiff told Mr. Rogers that he did not need to seek
independent counsel to represent him in the negotiation of the
Consulting Agreement and that he would represent himself to save
money.

Defendants also argue that Plaintiff did not convey any

confidential
Consulting

communications
Agreement

correspondence,

or

as

during

to

Shulman

Mr.

Bowen

its

Rogers
was

regarding

copied

representation

of

on
him

the
every

in

the

Airtime collection matter, an unrelated matter.
MRPC

1.9

provides

that

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
20

which

that

person’s

interests

are

materially

adverse

to

the

interests of the former client unless the former client gives
informed consent, confirmed in writing.”

MRPC 1.9(a).

Comment

3 to Rule 1.9 states that:
Matters are ‘substantially related’ for the
purposes of this Rule if they involve the
same transaction or legal dispute or if
there otherwise is a substantial risk that
confidential factual information as would
normally have been obtained in the prior
representation would materially advance the
client’s position in the subsequent matter.
Plaintiff’s arguments regarding Rule 1.9 hinge on whether
he can establish that he was a former client of Shulman Rogers
in a matter that substantially relates to the present litigation
over the Consulting Agreement.

See Victors, 553 F.Supp.2d at

551-52 (“To succeed on a disqualification motion, the moving
party

must

establish,

first,

that

an

attorney-client

relationship existed between the challenged law firm and the
objecting client, and second, that the matter at issue in the
challenged representation is the same or substantially related
to the matter involved in the prior representation.”)
Plaintiff
Shulman

has

Rogers’

collection

not

provided

representation

matter

any
of

substantially

facts

him

in

relates

establishing

that

the

2010

Airtime

to

the

present

litigation, nor that Shulman Rogers obtained any confidential
information

during

that

representation

21

that

would

materially

advance Defendants’ position in this matter.

As for the present

matter,

litigation,

there

is

no

question

that

this

which

involves a dispute over the terms of the Consulting Agreement
and

the

parties’

thereto,
Shulman

is

rights

substantially

Rogers

Agreement.

given

in

and

related

drafting

and

obligations
to

the

with

previous

negotiating

the

respect
work

of

Consulting

Thus, the remaining issue is whether Plaintiff has

established that an attorney-client relationship existed between
himself and Shulman Rogers during the negotiation and drafting
of the Consulting Agreement, such that Shulman Rogers should be
disqualified from representing Defendants in order to avoid a
substantial

risk

that

they

will

use

Plaintiff’s

confidential

information to materially advance Defendants’ position here.
Plaintiff has not met his burden in establishing that an
attorney-client

relationship

existed

during

the

drafting

and

negotiation of the Consulting Agreement, or that Shulman Rogers
acquired any confidential information related to his interests
during this process.
he

must

show

that

Importantly, as part of Plaintiff’s burden
he

reasonably

believed

an

attorney-client

relationship existed with Shulman Rogers, and provide evidence
to support this belief.
stage

yet

Plaintiff’s

This case has now passed the discovery
evidence

that

relationship existed is ambiguous at best.

an

attorney-client
See Victors, 553

F.Supp.2d at 553 (denying movant’s motion to disqualify counsel
22

under

MRPC

1.9

relationship

because

existed

the

was

evidence

“dubious”).

that

an

attorney-client

Plaintiff

points

to

a

conflicts waiver letter drafted by Shulman Rogers on April 5,
2011, which states in relevant part:
We act as counsel to Jerry Fenzel and Group
2 Software, LLC in a variety of business
matters, and specifically with regards to
the operation of Group 2 Software, LLC, a
company wholly owned by Thomas Bowen.
In
addition, we have on-going work for Messrs.
Fenzel and Bowen.
We have been asked to
represent Mr. Fenzel and Group 2 Software,
LLC in preparing a consulting agreement that
they will both be party to. We believe that
we can accept this representation if each of
you consents.
(ECF

No.

73-12)

(emphasis

added).

Plaintiff

and

Defendants

acknowledge that this conflicts waiver was a circulated draft
that was never executed by the parties, meaning the parties
never adopted any of the provisions in the letter, nor waived
any alleged conflicts.

Moreover, based on the April 19, 2011

email

it

from

Mr.

Rogers,

appears

that

the

parties

did

not

receive this conflicts waiver until most of the negotiation and
drafting
Plaintiff

process
also

had

taken

references

place.7
an

email

7

(ECF
where

No.
he

73-13,
purports

at
to

3).
be

The
discussions
surrounding
Plaintiff’s
potential
employment with Group2 began by November 2010 (ECF No. 73-7),
yet, Mr. Rogers apparently did not send the conflicts waiver
letter to the parties until April 19, 2011. (See ECF No. 73-13,
at 3) (“My apologies.
It seems that for some reason, the
revised Consulting Agreement and conflict waiver was never
forwarded to you, even though it was prepared 3 weeks ago.”).
23

relying on guidance from Shulman Rogers during the negotiations
process.
Rogers:

(ECF Nos. 73-13, at 1).

In the email, he asks Mr.

“Do you think that my 15% interest should accelerate,

along with any deferred comp, if there was a change in control?”
This statement, taken alone, suggests that he may be relying on
Shulman Rogers for legal advice in this negotiation.

When this

statement is read in context,8 however, and in conjunction with
the

other

becomes

emails

clear

between

that

Shulman

Plaintiff

is

Rogers
not

and

Plaintiff,

it

asking

advice,

but

negotiating on his own behalf to obtain favorable compensation
terms.

Indeed,

consistently

throughout

the

negotiation

and

drafting process, Shulman Rogers addresses Plaintiff as if he is
8

Plaintiff’s April
relevant part, states:

28,

2011

email

to

Mr.

Rogers,

in

Do you think that my 15% interest should
accelerate, along with any deferred comp, if
there was a change in control?
I think my
email of last week is rather concise and
makes it very clear as to what I requested
initially.
I think the various versions of
the 1.5 page of the term sheet have
gravitated
away
from
what
I
initially
thought was fair and reasonable.
Plaintiff’s email shows that he is dissatisfied with Shulman
Rogers drafting of his proposed terms. Indeed, he had previously
asked that this particular term be added or clarified in his
April 22, 2011 email to Shulman Rogers (ECF No. 73-13, at 2),
and Mr. Rogers responded to Plaintiff on April 27, 2011 stating:
“If your only change is that you wish to get paid if Group2 is
sold during the first 12 months, then we’ll revise the
Consulting Agreement to provide that you get your deferred comp
and 15% interest. If that works let me know.” (Id. at 1).
24

the opposing party in a negotiation, not as if he is a client.
Accordingly, the two ambiguous sentences cited by Plaintiff as
evidence of an attorney-client relationship are insufficient to
meet his burden of proof, especially in the face of the numerous
instances wherein Plaintiff negotiates on his own behalf.9
reasonable

person

who

believes

he

is

represented

by

No

counsel

would expect to negotiate on his own behalf against his own
counsel.

See Wong, 815 F.Supp. at 896 (finding that there was

no evidence in the record supporting that Mr. Wong relied on
defendants

for

legal

advice,

“[t]o

the

contrary,

the

record

reveals that Mr. Wong actively negotiated with the defendants
and spoke with them as one businessman addressing another”).
addition,

Plaintiff

could

not

produce

an

engagement

In

letter,

bills, or emails supporting an attorney-client relationship in
9

The parties included various letters and emails as
exhibits.
The following statements support that Plaintiff was
representing himself in the drafting of the Consulting Agreement
and Shulman Rogers was representing Thomas Bowen and Group2:
(1) on May 16, 2011 Mr. Rogers emailed Plaintiff, stating “I
have substantially adopted your revisions to the Consulting
Agreement . . . .
I hope we now have a final agreement[.]”
(ECF No. 73-9, at 3); (2) on March 8, 2011 Mr. Rogers emailed
Plaintiff, stating “I am back in town and I will discuss your
comments with Thom.” (Id. at 5); (3) on March 2, 2011 Plaintiff
emailed Mr. Rogers, stating “Thanks for getting this proposal to
me.
I am in general agreement with the terms of this offer,
although I think the equity component a little light . . .
[m]aybe my voluntary efforts to date . . . could be quantified
by some (restricted?) equity ownership in Group2.” (ECF No. 739, at 6); (4) on March 2, 2011, Mr. Rogers wrote a proposed
offer letter, which started out “Dear Jerry, On behalf of Thomas
C. Bowen, we would like to propose the following principal
terms[.]” (ECF No. 76-1, at 3) (emphasis added).
25

this matter.

In contrast, he has such documentation to support

Shulman Roger’s representation of him in the Airtime collection
matter,

which

further

supports

that

no

attorney-client

relationship existed for the Consulting Agreement.

Moreover, as

Defendants point out, Thomas Bowen was copied on every email
between

Plaintiff

attorney-client
Rogers

did

and

Shulman

relationship

not

acquire

Rogers.

existed

any

Thus,

with

confidential

even

if

an

Plaintiff,

Shulman

information

because

Thomas Bowen was a party to each communication, which destroys
Plaintiff’s claim to confidentiality.

Shulman Rogers will not

be disqualified under Rule 1.9, as Plaintiff has not met his
burden of showing that an attorney-client relationship existed
between himself and the firm in negotiating and drafting the
Consulting Agreement.
D.

Rule 3.7: Attorney Prohibited from Representing a
Client in a Case Where the Attorney Needs to Testify
as a Fact Witness

Plaintiff
representing
Rogers’

argues

that

Defendants

attorneys

will

in
be

Shulman
this

Rogers

is

litigation

required

to

prohibited
because

testify

Defendants as fact witnesses in this case.

from

Shulman

adversely

to

Plaintiff argues

that Shulman Rogers’ attorneys will be required to provide parol
evidence, likely in the form of testimony, regarding ambiguities
in the May 1 and June 2 Consulting Agreements that the firm
drafted and the intent of the parties regarding which version of
26

the

Consulting

Agreement

controls.

(ECF

No.

73-1,

at

13).

Plaintiff alleges that he approached a Shulman Rogers attorney
regarding the June 2 Consulting Agreement, and was told that it
was of no legal consequence, advice on which he relied.
these

factual

disputes

regarding

the

Consulting

Because
Agreement

between the parties is at the heart of this dispute, Plaintiff
argues

that

Shulman

Rogers

should

be

prohibited

from

representing Defendants in order to avoid confusion over its
attorneys acting in a dual roles as witnesses and attorneys.
Plaintiff cites Moyer v. 1330 Nineteenth St. Corp, 597 F.Supp.
14,

16

(D.D.C.

1984),

for

the

proposition

that

“[w]hen

the

lawyer’s testimony is or may be prejudicial to the client, the
lawyer has a conflict of interest, and the prohibition on acting
as an advocate extends not only to the lawyer but also to his or
her firm.”

Plaintiff argues that Mr. Rogers’ testimony and the

testimony of other Shulman Rogers’ attorneys who were involved
in the “drafting, negotiation, and execution of the May 1 and
June 2 [Consulting] Agreements, will be material to this case
and

harmful

to

Defendants,”

withdraw from this matter.
In
counsel

response,
assigned

Shulman
to

this

thus,

they

should

be

forced

to

(ECF No. 73-1, at 14).
Rogers
case

—

argues
Glenn

that

its

Etelson

litigation

and

William

Schroeder — will not be witnesses in this matter “as they have
no personal knowledge or information as to the formation or
27

negotiation of the Consulting Agreement.”

(ECF No. 76, at 8).

Defendants’ counsel asserts that they were not involved in the
negotiation

or

formation

of

the

Consulting

Agreement

as

evidenced by the emails attached to the filings, and that Mr.
Etelson only became involved with Group2 once a dispute arose in
May 2012.

(ECF No. 76, at 8).

MRPC 3.7(b) states that a “lawyer may act as [an] advocate
in a trial in which another lawyer in the lawyer’s firm is
likely to be called as a witness unless precluded from doing so
by Rule 1.7 or Rule 1.9.”

Shulman Rogers has indicated that its

litigation attorneys, Mr. Etelson and Mr. Schroeder, were not
involved

in

Agreement.

the

negotiation

and

drafting

of

the

Consulting

Therefore, they have no personal knowledge and could

not appropriately be called as witnesses at trial.

As noted

above, their representation is not precluded under Rules 1.7 or
1.9, thus they may serve as advocates under Rule 3.7(b).

Mr.

Rogers, Mr. Barlett, or other Shulman Rogers attorneys involved
in drafting the Consulting Agreement may be called as witnesses;
there is no risk in confusing the jury because they will not be
serving as advocates for Defendants at trial.
IV.

Conclusion
For the foregoing reasons, the motion of Plaintiff Jerry

Fenzel to disqualify Defendants’ counsel, Shulman Rogers, and to
reopen

discovery

will

be

denied.
28

Defendants’

request

for

sanctions against Plaintiff for filing this motion will also be
denied.

Although the court finds that Plaintiff has not met his

burden in showing that a disqualification is required, Plaintiff
has some factual and legal bases for making its motion.
separate order will follow.

/s/
DEBORAH K. CHASANOW
United States District Judge

29

A