Saline River Properties, LLC v. Johnson Controls, Inc.

Filing 110

OPINION AND ORDER granting in part and denying in part 76 Motion to Disqualify Counsel.. Signed by District Judge Sean F. Cox. (JHer)

UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF MICHIGAN
SOUTHERN DIVISION
Saline River Properties, LLC,
a Michigan limited liability company,
Plaintiff,
v.

Case No. 10-10507

Johnson Controls, Inc., a Wisconsin
corporation,

Honorable Sean F. Cox

Defendant.
____________________________________/
OPINION & ORDER
GRANTING IN PART AND DENYING IN PART
JCI’S MOTION TO DISQUALIFY MR. MCCLURE AS TRIAL COUNSEL
This matter is currently before the Court on JCI’s Motion to Disqualify Attorney Douglas
McClure as trial counsel (Docket Entry No. 76). As explained below, the Court concludes that
while Mr. McClure’s testimony is relevant to the claims and defenses that will be presented at
trial, to disqualify him at this late stage of the litigation would work a substantial hardship on
Saline. The Court shall GRANT THE MOTION IN PART AND DENY THE MOTION IN
PART. The Court shall deny JCI’s request to entirely disqualify Mr. McClure as trial counsel.
The Court shall allow Mr. McClure to serve as co-counsel, providing Mr. Evans delivers the
opening and closing statements at trial.
BACKGROUND
There are two related cases that are now before this Court and they both involve the same
parties and the same property – a 22 acre parcel in Saline, Michigan (“the Property”). Johnson

1

Controls, Inc. (“JCI”) previously owned or operated a facility on the Property. In 1993, JCI
consented to an Administrative Order on Consent (“AOC”) by the Environmental Protection
Agency (“E.P.A.”), which: 1) requires JCI to take various environmental remedial actions by
specified dates; and 2) provides stipulated penalties for failing to do so. Saline River Properties,
LLC (“Saline”) is the current owner of the Property.
Saline purchased the Property in 2006. McClure, an attorney specializing in
environmental law, was retained by Saline in mid to late 2006.
This litigation commenced in 2010, and there are two different actions involving these
same parties. The two actions were consolidated for “discovery and pretrial proceedings.” (D.E.
No. 39).
Mr. McClure, along with attorney Mark D. Evans, has been representing Saline in Case
No. 10-10507 since February 2, 2010, the date that action was filed. He has also been counsel of
record in Case No. 10-13406 since the inception of that case.
The Scheduling Order provides that: 1) witness lists were to be filed by April 24, 2011,
and that no motions could be filed after June 24, 2011. (D.E. No. 43).
JCI deposed Mr. McClure on February 23, 2011. (See D.E. No. 76-1, Ex. D). JCI named
Mr. McClure as a witness on April 21, 2011. (D.E. No. 54 at ¶ 1). JCI filed this motion seeking
to disqualify Mr. McClure on June 22, 2011 – two days before the deadline for filing motions.
(D.E. No. 76).
ANALYSIS
JCI asks this Court to disqualify attorney Douglas McClure as trial counsel for Saline,
pursuant to Rule 3.7(a) of the Michigan Rules of Professional Conduct. Rule 3.7 provides:

2

(a) A lawyer shall not act as advocate at a trial in which the lawyer is likely to be
a necessary witness except where:
(1) the testimony relates to an uncontested issue;
(2) the testimony relates to the nature and value of legal services rendered
in the case; or
(3) disqualification of the lawyer would work substantial hardship on the
client.
(b) A lawyer may act as 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 to by
Rule 1.7 or Rule 1.9.
MI RULES MRPC 3.7. The comments to the above rule include some discussion of the
rationale behind the rule:
Combining the roles of advocate and witness can prejudice the opposing party
and can involve a conflict of interest between the lawyer and client.
The opposing party may properly object where the combination of roles may
prejudice that party’s rights in the litigation. A witness is required to testify on
the basis of personal knowledge, while an advocate is expected to explain and
comment on evidence given by others. It may not be clear whether a statement by
an advocate-witness should be taken as proof or as an analysis of proof.
Comments to MI RULES MRPC 3.7. The comments further state that “paragraph (a)(3)
recognizes that a balancing is required between the interests of the client and those of the
opposing party. Whether the opposing party is likely to suffer prejudice depends on the nature
of the case, the importance and probable tenor of the lawyer’s testimony, and the probability that
the lawyer’s testimony will conflict with that of other witnesses. Even if there is a risk of such
prejudice, in determining whether the lawyer should be disqualified due regard must be given to
the effect of disqualification on the lawyer’s client.” Id.

3

JCI asserts that Mr. McClure is a necessary witness because, through his involvement
with the Property as Saline’s counsel since 2006, he authored several e-mails relating to Saline’s
due care obligations and the destruction of the slab. JCI also asserts that McClure’s testimony is
needed to support JCI’s position that it was not required, under the AOC, to address every aspect
of contamination at the Property and thus the relief Saline seeks exceeds JCI’s obligations under
the AOC.
JCI further asserts that none of the exceptions set forth in Rule 3.7 apply to McClure.
JCI contends that the testimony sought from McClure is not on an uncontested issue and that it
cannot have any other witness authenticate e-mails from Mr. McClure or testify as to what Mr.
McClure meant by making certain statements. JCI further asserts that disqualifying Mr.
McClure will not work a substantial hardship on Saline because it has another attorney who has
been working on the case since its inception, Mr. Evans, and that Mr. Evans has done the bulk of
the work in this case thus far.
Saline contends that JCI is trying to disqualify Mr. McClure for strategic reasons. Saline
asserts that Mr. McClure is not a necessary witness because his testimony is not relevant to the
issues in the citizen suit. It also contends Mr. McClure is not needed to authenticate any e-mails
because Saline “has never challenged the authenticity of the subject emails.” (Saline’s Resp. Br.
at 2). Saline contends that to the extent the e-mails are relevant, they “speak for themselves” and
no testimony is necessary from Mr. McClure. Saline also asserts that disqualifying Mr. McClure
would work a substantial hardship on Saline because he is the lawyer with the environmental
knowledge and experience in this case.
Saline further asserts that because this case is a bench trial, the rationale behind the rule

4

does not apply here with the same force it would in a jury trial. Saline also suggests that a
compromise or middle ground could be ordered here:
The Court is certainly capable, in this bench trial, of distinguishing between Mr.
McClure’s testimony and any argument he may make as advocate. Nevertheless,
at most, Mr. McClure should be permitted to service as co-counsel during trial
and examine witnesses, leaving opening statement and closing arguments to Mr.
Evans. In this manner, Mr. McClure would be alleviated from arguing as to his
own credibility as a witness.
(Saline’s Resp. Br. at 12).
The Court concludes that Mr. McClure’s e-mails and testimony regarding same is
relevant to JCI’s counterclaims and may be relevant to JCI’s defenses in the citizen suit.
Nevertheless, disqualifying Mr. McClure – especially at this stage of the litigation – would work
a substantial hardship on Saline. Saline essentially has two lawyers on this case: 1) McClure, an
environmental lawyer; and 2) Evans, a litigator. To disqualify Mr. McClure would leave Saline
with only a litigator to try environmental claims. Moreover, these environmental claims involve
complex statutes and defenses.
JCI’s assertion that another lawyer in Mr. McClure’s firm could simply step in and help
try the case is unpersuasive because JCI has not identified any other attorney in McClure’s firm
who specializes in environmental law.
In addition, JCI waited until two days before the motion deadline before seeking to
disqualify Mr. McClure, although it had deposed him back in February and therefore knew then
that they may wish to call him as a witness.
Moreover, given that the remaining claims will be tried to the bench – as opposed to a
jury – the Court agrees with Saline that disqualifying Mr. McClure would not serve the purpose

5

of the rule. “Michigan courts have observed that the purpose of the rule is to prevent any
problems that would arise from a lawyer’s having to argue the credibility and the effect of his or
her own testimony” and to prevent prejudice to the opposing party that might arise therefrom.
People v. Tesen, 276 Mich.App. 134, 143 (2007). Unlike a jury, this Court is capable of
distinguishing between Mr. McClure’s trial testimony and any statements he would make as an
advocate. Moreover, by allowing Mr. McClure to serve as co-counsel, and having Mr. Evans
deliver the opening and closing statements to the Court, the purpose behind the rule will be
satisfied.
CONCLUSION & ORDER
For the reasons set forth above, IT IS ORDERED that JCI’s Motion to Disqualify Mr.
McClure as trial counsel is GRANTED IN PART AND DENIED IN PART. The Court denies
JCI’s request to entirely disqualify Mr. McClure as trial counsel. The Court shall allow Mr.
McClure to serve as co-counsel, providing Mr. Evans delivers the opening and closing
statements at trial.
IT IS SO ORDERED.
S/Sean F. Cox
Sean F. Cox
United States District Judge
Dated: October 17, 2011
I hereby certify that a copy of the foregoing document was served upon counsel of record on
October 17, 2011, by electronic and/or ordinary mail.
S/Jennifer Hernandez
Case Manager

6