Waneck et al v. CSX Corporation et al

Filing 126

Order Overruling Plaintiffs' 114 Objections to, and Denying Plaintiffs' Appeal of, Magistrate Judge's Order 113 , and Denying Plaintiffs' Motion 116 to File Attorney Client Privileged Documents Under Seal. Signed by District Judge Halil S. Ozerden on November 7, 2017. (BGL)

IN THE UNITED STATES DISTRICT COURT
FOR THE SOUTHERN DISTRICT OF MISSISSIPPI
SOUTHERN DIVISION
STARR SWEARINGEN WANECK AND
AND JIMMY LEE WANECK
v.

PLAINTIFFS
CIVIL NO. 1:17CV106-HSO-JCG

CSX CORPORATION, ET AL.

DEFENDANTS

ORDER OVERRULING PLAINTIFFS’ [114] OBJECTIONS TO, AND
DENYING PLAINTIFFS’ APPEAL OF, MAGISTRATE JUDGE’S ORDER
[113], AND DENYING PLAINTIFFS’ MOTION [116] TO FILE
ATTORNEY CLIENT PRIVILEGED DOCUMENTS UNDER SEAL
BEFORE THE COURT are Plaintiffs Starr Swearingen Waneck and Jimmy
Lee Waneck’s [114] Objections to, and Appeal of, United States Magistrate Judge
John C. Gargiulo’s August 25, 2017, Order [113] Granting Defendant CSX
Transportation, Inc.’s Motion [50] to Raise Nonconsentable Conflict of Interest
Under Rule 1.7(b) of the Mississippi Rules of Professional Conduct and Disqualify
Pro Hac Vice Admitted Attorney Robert L. Pottroff, and Plaintiffs’ Motion [116] to
File Attorney Client Privileged Documents Under Seal.

For the reasons that

follow, the Court finds that Plaintiffs’ Objections should be overruled, that their
Appeal should be denied, and that their Motion to File Under Seal should be denied.
I. BACKGROUND
A.

Relevant Background
This matter arises out of a collision that occurred on March 7, 2017, when a

charter bus, in which Plaintiffs Starr Swearingen Waneck and Jimmy Lee Waneck
(“Plaintiffs”) were passengers, became wedged on a railroad crossing in Biloxi,

Mississippi, and was struck by a freight train.

Am. Compl. [1-1] at 44-46.

Plaintiffs filed their Complaint on March 10, 2017, in the Circuit Court of Harrison
County, Mississippi, Second Judicial District, and on March 20, 2017, filed an
Amended Complaint.

Notice of Removal [1] at 1.

The Amended Complaint asserts claims against all Defendants for, among
other things, negligence, gross negligence, negligence per se, willful and wanton
conduct, recklessness, intentional conduct, and a reckless and intentional disregard
for the safety of the traveling public, breach of Defendants’ duties to “operate a
train at a speed for the then existing conditions and be prepared to slow or stop for
any hazardous conditions” and to inspect, repair, and report unsafe crossings, and
intentional disregard for the safety of the traveling public.

Plaintiffs seek actual

and punitive damages and costs from Defendants, jointly and severally.
Compl. [1-1] at 46-58.

Am.

Defendants CSX Corporation (“CSXC”) and CSX

Transportation, Inc. (“CSXT”), removed the case to this Court on April 11, 2017.
Notice of Removal [1] at 1-11.
On June 2, 2017, Defendant CSXT filed a Motion [50] to Raise
Nonconsentable Conflict of Interest Under Rule 1.7(b) of the Mississippi Rules of
Professional Conduct and Disqualify Pro Hac Vice Admitted Attorney Robert L.
Pottroff. Plaintiffs filed a Response [62] in Opposition, CSXT filed a Rebuttal [71],
and Plaintiffs filed a Sur-reply [90].

2

On August 25, 2017, the Magistrate Judge entered an Order [113] granting
CSXT’s Motion and disqualifying attorneys Robert L. Pottroff and Nathan L. Karlin
of the law firm of Pottroff Law Office, PA (“Pottroff”), from representing Plaintiffs in
this case. Order [113] at 21. The Magistrate Judge found the existence of a
conflict of interest for Pottroff to represent Plaintiffs in the current matter for
claims arising out of the March 7, 2017, collision while simultaneously representing
the City of Biloxi, Mississippi, for claims brought against the City by CSXT under
the Mississippi Tort Claims Act, Mississippi Code Annotated §11-46-1, et. seq.,
arising out of the same collision.

Order [113] at 11-16.

The Magistrate Judge

concluded that this conflict of interest was nonconsentable under both Mississippi
Rule of Professional Conduct 1.7 (“Mississippi Rule”) and the American Bar
Association’s (“ABA”) Model Rule of Professional Conduct 1.7 (“Model Rule”).
Specifically, the Magistrate Judge found as follows:
The present case strikes the Court as exactly the type of
circumstances under which a disinterested lawyer would conclude that
a client should not agree to the (sic) his or her lawyer’s representation
of an additional client with adverse interests. The simultaneous
representation of the Wanecks and the City of Biloxi presents serious
and unavoidable conflicts of interest for Pottroff. The Wanecks seek to
recover monetary damages for the injuries they suffered in the accident.
It would seemingly not matter to them who is ultimately responsible for
the accident, or in what proportion; they simply seek to recover as much
as they are owed. However, to the extent that the City of Biloxi has an
interest in the instant litigation, it is to minimize its liability for the
accident. Necessarily, Pottroff cannot pursue any claim the Wanecks
might have against Biloxi, no matter what the factual investigation
reveals. The agreement between Pottroff and Biloxi even provides,
“The Pottroff Law Office and any associated clients have agreed not to
3

pursue suit or seek other legal recourse against the City of Biloxi related
to this matter.” (ECF No. 50-3, at 9-10). Therefore, he cannot provide
“competent and diligent representation” to the Wanecks. Model R.
Prof’l Conduct 1.7(b)(1).
Additionally, subpart (b)(3) of Model Rule 1.7 similarly counsels
against the consentability of the present conflict of interest. Although
Plaintiffs have not asserted a claim against the City of Biloxi, they
cannot do so while their attorney also represents Biloxi. Nonetheless,
their interests, as already set forth, are adverse. Accordingly, the Court
finds that the concurrent conflict of interest in Pottroff’s representation
of both the Wanecks and the City of Biloxi is not consentable under
either Mississippi Rule 1.7 or Model Rule 1.7.
Id. at 18-19 (footnote omitted).
The Magistrate Judge further found that the disqualification of Pottroff
would not be detrimental to Plaintiffs’ case because they will continue to be
represented by competent counsel in William M. Cunningham, Jr. and Troy T.
Schwant, both of the law firm Burns, Cunningham & Mackey, counsel of record
appearing on the original Complaint. Id. at 20; Compl. [1-1] at 5-22.
B.

Plaintiffs’ [114] Objections to, and Appeal of, Magistrate Judge’s Order
On September 9, 2017, Plaintiffs filed their [114] Objections to, and Appeal

of, Magistrate Judge’s Order. Plaintiffs do not contest the Magistrate Judge’s
determination that a conflict of interest exists, only his conclusion that this conflict
of interest is nonconsentable.

Mem. in Supp. [121] at 2.

Plaintiffs proffer that “no

lawyer for any victim”1 has asserted a claim against the City of Biloxi, Mem. in

The term “victim” is not defined. The Court notes that CSXT has submitted a
Tort Claim letter dated May 26, 2017, to the City of Biloxi “noticing its intent to file
1

4

Supp. [121] at 5, that Plaintiffs “do not wish to now or ever make a claim” against
the City of Biloxi, id. at 9, and that “any ‘potential conflict’ will disappear on March
7, 2018,” based upon the limitations period for filing claims against the City of
Biloxi under Mississippi Code Annotated §11-46-11(3), id.

Plaintiffs maintain that

Pottroff should not be disqualified since they were fully informed of the conflict and
have given “knowing, informed and written consent to Attorney Pottroff’s
representation of the City of Biloxi.” Id. at 11.
CSXT’s Response [119] contends that the Magistrate Judge reached the
correct decision and that Plaintiffs fail to identify “any error of law or fact in the
Magistrate Judge’s reasoned and legally sound written order.” Resp. in Opp’n
[119] at 4.

According to CSXT, Plaintiffs’ admission that a conflict exits since the

City of Biloxi’s liability “‘may later be supported by facts,”’ only confirms that a
nonconsentable conflict of interest exists for Pottroff to continue to represent
Plaintiffs. Id. at 14-15 (quoting Pls.’ Mem. in Supp. [121] at 4).
Plaintiffs’ Reply [122] maintains that although there may exist a conflict in
Pottroff’s concurrent representation of Plaintiffs and Biloxi, Plaintiffs may and do
consent to such concurrent representation. “Pottroff’s representation of the City
does not foreclose the Wanecks from pursuing an action against the City of Biloxi,
should they wish to in the future.”

Reply [122] at 3.

Alternatively, Plaintiffs seek

a complaint and/or third-party complaint” and referencing this case. CSXT Letter
[71-2] at 1-4.
5

an order “wherein the Magistrate Judge will review the disqualification of Attorney
Pottroff after March 7, 2018 to determine if a conflict of interest still exists.” Id.
C.

Plaintiffs’ Motion [116] to File Attorney Client Privileged Documents Under
Seal
In conjunction with their Objections, Plaintiffs have filed a Motion [116]

seeking permission to file under seal, pursuant to Local Uniform Civil Rule 79(b),
three affidavits purported to be those of Pottroff and each Plaintiff, on grounds that
they contain communications protected by the “attorney-client privilege.”
File [116] at 1-2.

Mot. to

Plaintiffs posit that although Local Uniform Civil Rule 72(a) does

not contemplate a district court receiving additional evidence in reviewing a
magistrate judge’s non-dispositive order, a court may exercise its discretion to do so.
Mem. in Supp. [117] at 2-4.

Allowing the proposed affidavits to be filed under seal

will supply the Court with “additional facts to support a finding that the [P]laintiffs
as a matter of law were fully aware of the issues before consenting to Robert L.
Pottroff’s continued representation and that the [M]agistrate [J]udge’s [O]rder
disqualifying Attorney Pottroff was contrary to the law.” Id. at 6.
CSXT’s Response [120] argues that the Motion should be denied in that it
does not comport with Local Uniform Civil Rule 79’s requirements to: (1) adequately
describe and justify sealing of the affidavits or differentiate them from the
previously filed affidavits; (2) discuss relevant case law concerning the sealing of
documents; (3) narrowly tailor the scope of the request; and (4) cite necessary facts

6

and law in the proposed order granting the Motion. Resp. in Opp’n [120] at 5-8.
CSXT further points out that Rule 72(a) does not permit a party to introduce
supplemental evidence when seeking review of a magistrate judge’s nondispositive
order.

Id. at 3-4; see Moore v. Ford Motor Co., 755 F.3d 802, 808 n.15 (5th Cir.

2014).
II.
A.

DISCUSSION

Standard of Review
In reviewing a magistrate’s pretrial order, a district court may set aside a

“non-dispositive order” if it is clearly erroneous or is contrary to law. Moore, 755
F.3d at 806 (citing FED. R. CIV. P. 72(a); 28 USC § 636(b)(1)(A)).

A district court’s

review of a magistrate judge’s factual findings contained in a nondispositive order is
limited to clear error review, thus a district court has the discretion to limit its
scope of review to the evidence presented to the magistrate judge. Id. at 808.
B.

Plaintiffs’ Objections should be overruled.
In determining that Pottroff’s conflict in simultaneously representing

Plaintiffs and the City of Biloxi is nonconsentable, the Magistrate Judge reasoned
that
[b]oth the Mississippi Rules and Model Rules agree that,
notwithstanding the existence of a concurrent conflict of interest, a
lawyer may continue to represent a client under certain circumstances.
Mississippi Rule 1.7 provides that a lawyer may only represent a
concurrently-conflicted client if “the lawyer reasonably believes” that
“the representation will not be adversely affected” and “the client gives
knowing and informed consent after consultation,” which “shall include
7

explanation of the implications of the representation and the
advantages and risks involved.” Miss. R. Prof’l Conduct 1.7(b). Model
Rule 1.7 provides that a lawyer may only represent a concurrentlyconflicted client if (1) “the lawyer reasonably believes that the lawyer
will be able to provide competent and diligent representation to each
affected client,” (2) the representation is not illegal, (3) the
representation “does not involve the assertion of a claim by one client
against another client represented by the lawyer in the same litigation,”
and (4) “each affected client gives informed consent, confirmed in
writing.” [See] Model R. Prof’l Conduct 1.7(b)(1)-(4).
The concern expressed through either framework is that “[a]
lawyer who attempt[s] to present both sides of a dispute might fail to
provide the forceful advocacy necessary for informed decisionmaking.
Both the fact and appearance of justice would be at risk, and reported
cases recognize as much.” DEBORAH L. RHODE AND GEOFFREY C.
HAZARD, JR., PROFESSIONAL RESPONSIBILITY AND REGULATION
127 (2nd ed. 2007).
.

.

.

With all of this in mind, “when a disinterested lawyer would conclude
that the client should not agree to the representation under the
circumstances, the lawyer involved cannot properly ask for [waiver] or
provide representation on the basis of the client’s consent.” Miss. R.
Prof’l Conduct 1.7 cmt.
Order [113] at 16-18 (quoting Model R. Prof’l Conduct 1.7(b)(1)-(4)).
Plaintiffs concede that a conflict may exist for Pottroff to represent them
while concurrently representing the City of Biloxi, but they contend that this
conflict is consentable.

Plaintiffs’ position is undermined by the language

contained in their Reply, which states that
[a]ssuming, [arguendo], there is a conflict of interest, any conflict
is consentable and Plaintiffs provided informed consent on multiple
occasions. ABA Model Rule 1.7(b) on informed consent provides as
follows:
8

If a lawyer reasonably believes that no client will be
adversely affected, and if the representation is not
prohibited by law and does not involve one client asserting
a claim against another, the lawyer may represent
conflicting interests if each affected client gives informed
consent, confirmed in writing.
Here, Plaintiffs provided sufficient evidence that the Wanecks
gave informed consent on multiple occasions for Attorney Pottroff to
represent them in this suit and the City of Biloxi in a potentially
separate suit [by] CSX. (ECF No. 63-3, 63-4 and 89-3 at 12-13[)]; and
confidential affidavits requested to be filed under seal. (ECF No. 116)
CSX has presented no evidence that any “disinterested lawyers” might
opine that the interest of a non-party and the Plaintiffs is
nonconsentable. CSX’s manufactured conflict of interest regarding
Attorney Pottroff’s representation of the City does not foreclose the
Wanecks from pursuing an action against the City of Biloxi, should they
wish to in the future.
Reply [122] at 1-3 (emphasis added).
Plaintiffs’ admission that they can or may pursue a cause of action
against the City of Biloxi undercuts, in the Court’s view, any right to consent
to Pottroff’s conflict of interest which arose when he agreed to represent the
City of Biloxi.2 The crux of Model Rule 1.7 is to prevent exactly what has
happened in this case.
Even if Plaintiffs could consent, “a district court is ‘allowed substantial
latitude in refusing waivers of conflicts of interest’ for an actual conflict of interest

Should CSXT file a third-party complaint against the City of Biloxi, Pottroff
would be in the position of simultaneously representing Plaintiffs and a third-party
defendant in the same litigation.

2

9

or a serious potential conflict that may arise during trial.” United States v.
Jackson, 805 F.3d 200, 202 (5th Cir. 2015) (quoting Wheat v. United States, 486 U.S.
153, 163 (1988)); see also In re Am. Airlines, Inc., 972 F.2d 605, 611(5th Cir. 1992)
(confirming that courts must be sensitive to preventing conflicts of interest, and a
district court must take “measures against unethical conduct occurring in
connection with any proceeding before it”) (citations and quotations omitted)).
After conducting a thorough review of the parties’ arguments and the record
as a whole, along with relevant legal authority and the Magistrate Judge’s succinct,
well-reasoned opinion, the Court finds that the Magistrate Judge’s Order is neither
clearly erroneous nor contrary to law. Under the facts of the present case,
Pottroff’s decision to undertake “simultaneous representation of Plaintiffs and the
City of Biloxi presents a nonconsentable conflict of interest warranting
disqualification” of Robert L. Pottroff and Nathan L. Karlin of the law firm of
Pottroff Law Office, PA. See Order [113] at 21.
C.

Plaintiffs’ request to file affidavits of Pottroff and Plaintiffs under seal should
be denied.
This Court has recognized that “the public has a common law right to inspect

and copy judicial records,” which serves to “promote trustworthiness of the judicial
process, to curb judicial abuses, and to provide the public with a more complete
understanding of the judicial system, including a better perception of fairness.”
Anderson v. Miss. Baptist Med. Ctr., 3:10cv469, 2017 U.S. Dist. LEXIS 42396, at *2

10

(S.D. Miss. March 23, 2017) (quoting S.E.C. v. Van Waeyenberghe, 990 F.2d 845,
848-849 (5th Cir. 1993)).

The party seeking to seal court documents bears the

burden of demonstrating that the need for secrecy outweighs the public’s right to
access. Id.
Pursuant to Local Rule 79, “[e]xcept as otherwise provided by
statute, rule, . . . or order, all pleadings and other materials filed with
the court (‘court records’) become a part of public record of the court[,
and] [a]ny order sealing a document must include particularized
findings demonstrating that sealing is supported by clear and
compelling reasons and is narrowly tailored to serve those reasons.”
Id. at *3 (quoting L.U.CIV.R. 79 (a)&(b)). A district court’s discretion in granting a
motion to seal must be “‘exercised charily.’” Id. (quoting Van Waeyenberghe, 990
F.2d at 848).
Plaintiffs ask the Court to exercise its discretionary authority to allow these
affidavits to be filed under seal for review in that they that contain additional facts
to establish that Plaintiffs’ consent was knowing.

No explanation is offered for

why this issue was not anticipated and submitted to the Magistrate Judge in the
first instance when CSXT’s Motion for disqualification was being briefed.
Moreover, given the Court’s finding that Pottroff’s conflict of interest is
nonconsentable, review of additional evidence concerning Plaintiffs’ consent would
be superfluous.

The Court finds that this Motion should be denied.

11

III.

CONCLUSION

To the extent the Court has not addressed any of the parties’ arguments, it
has considered them and determined that they would not alter the result. Having
conducted the required review, the Court concludes that the Magistrate Judge’s
findings are not clearly erroneous, nor are they an abuse of discretion or contrary to
law.
IT IS, THEREFORE, ORDERED AND ADJUDGED that the Magistrate
Judge’s August 25, 2017, Order [113] Granting Defendant CSX Transportation,
Inc.’s Motion [50] to Raise Nonconsentable Conflict of Interest Under Rule 1.7(b) of
the Mississippi Rules of Professional Conduct and Disqualify Pro Hac Vice
Admitted Attorney Robert L. Pottroff is adopted as the finding of this Court, as
supplemented herein.
IT IS, FURTHER, ORDERED AND ADJUDGED that Plaintiffs’ Motion
[116] to File Attorney Client Privileged Documents Under Seal is DENIED.
IT IS, FURTHER, ORDERED AND ADJUDGED that Plaintiffs Starr
Swearingen Waneck and Jimmy Lee Waneck’s [114] Objections are
OVERRULLED, and their Appeal is DENIED.

12

IT IS, FURTHER, ORDERED AND ADJUDGED that Robert L. Pottroff
and Nathan L. Karlin of the law firm of Pottroff Law Office, PA, are disqualified
from representing Plaintiffs in this case.
SO ORDERED AND ADJUDGED, this the 7th day of November, 2017.

s/ Halil Suleyman Ozerden
HALIL SULEYMAN OZERDEN
UNITED STATES DISTRICT JUDGE

13