Dugan et al v. Wiegand et al

Filing 98

ORDER denying 93 Pro Se Motion to Disqualify Counsel. Signed by Magistrate Judge David S. Cayer on 12/7/2020. (Pro se litigant served by US Mail.)(mek)

IN THE UNITED STATES DISTRICT COURT
FOR THE WESTERN DISTRICT OF NORTH CAROLINA
CHARLOTTE DIVISION
CIVIL ACTION NO. 3:15-CV-00366-RJC-DSC
GUY M. DUGAN ET AL.,
Plaintiffs,
v.
INVICTUS ASSET MANAGEMENT
LLC ET AL.,
Defendants.

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ORDER

THIS MATTER is before the Court on the “Motion to Disqualify Counsel” (document #
93) filed October 20, 2020 and the Plaintiffs’ response and exhibits (document #97).
This matter was referred to the undersigned Magistrate Judge pursuant to 28 U.S.C. §
636(b)(1).
Pro se Defendants David W. Schamens and Piliana M. Schamens seek disqualification of
Plaintiffs’ counsel Lex M. Erwin and his firm Erwin, Bishop, Capitano & Moss, P.A. pursuant to
Rule 1.18 of the North Carolina Rules of Professional Conduct.
“The guiding principle in considering a motion to disqualify counsel is safeguarding the
integrity of the court proceedings” and “the purpose of granting such motions is to eliminate the
threat that the litigation will be tainted.” Plant Genetic Sys., N.V. v. Ciba Seeds, 933 F. Supp. 514,
517 (M.D.N.C. 1996). The court must balance (1) a party's right to his choice of counsel and the
potential substantial hardship resulting from disqualification against (2) the importance of
safeguarding the public trust in the judicial system. Johnson v. Brock & Scott, PLLC, 2012 WL

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4483916, at *7 (E.D.N.C. Sept. 26, 2012). However, “the moving party has a very high standard
of proof in moving to disqualify an opposing party's counsel. It follows that a court should not
disqualify a party's chosen counsel on imagined scenarios of conflict.” Capacchione v. CharlotteMecklenburg Bd. Of Educ., 9 F.Supp.2d 572, 579 (W.D.N.C. 1998).
“Motions to disqualify counsel are not looked upon favorably.” Tech Partners, Inc. v.
Papaioannou, 2016 WL 797555, at *2 (W.D.N.C. March 1, 2016). “The drastic nature of
disqualification requires that courts avoid overly-mechanical adherence to disciplinary canons at
the expense of litigants' rights freely to choose their counsel.” Shaffer v. Farm Fresh, Inc., 966
F.2d 142, 146 (4th Cir.1992). Courts are to “remain mindful of the opposing possibility of misuse
of disqualification motions for strategic reasons.” Id. (citing Woods v. Covington Cnty. Bank, 537
F. 2d 804, 813 (5th Cir.1976)). In order to avoid the potential for abuse, the Fourth Circuit has
held that disqualification for violations of an ethical canon “may not be rested on mere speculation
that a chain of events whose occurrence theoretically could lead counsel to act counter to his
clients’ interests might in fact occur.” Id. at 145 (citing Aetna Casualty & Surety Co. v. United
States, 570 F.2d 1197, 1200–02 (4th Cir.1978)).
North Carolina Rule of Professional Conduct 1.18 governs duties to a prospective client.
Defendants allege that David Schamens had telephone conversations on August 26 and 27, 2015
with Dan Bishop, Erwin’s law partner, about possible representation in an arbitration and that
Bishop was privy to confidential information pertaining to this case. Plaintiffs argue that the
arbitration and the present action are totally unrelated. Bishop declined to represent Schamens and
they never established an attorney-client relationship. Erwin made his appearance in this case on
May 23, 2018.

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The Court has carefully examined the record, the parties’ arguments and the applicable
authorities. The Court finds that Defendants have failed to meet their high evidentiary burden to
disqualify Erwin and overcome Plaintiffs’ right to their choice of counsel. Accordingly,
Defendants’ “Motion to Disqualify Counsel” (document # 93) is DENIED.
The Clerk is directed to send copies of this Order to counsel for Plaintiffs, pro se
Defendants and to the Honorable Robert J. Conrad, Jr.
SO ORDERED.

Signed: December 7, 2020

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