Gordon v. Impulse Marketing Group Inc

Filing 370

ORDER Denying 235 Motion to Compel and Motion for Sanctions; Denying 298 , 300 , 256 , and 259 Motions to Compel and Requests for Sanctions; Denying 274 and 270 Amended Motions to Compel and Requests for Sanctions. The request to disqualify Floyd Ivey by Bonnie and Jamila Gordon is Denied. Finding as Moot 325 Motion to Strike; Finding as Moot 337 Motion to Expedite; Finding as Moot 339 Motion to Strike; Finding as Moot 342 Motion to Expedite; Finding as Moot 344 Motion to Strike. Signed by Judge Fred Van Sickle. (SAP, Case Administrator)

Gordon v. Impulse Marketing Group Inc

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UNITED STATES DISTRICT COURT EASTERN DISTRICT OF WASHINGTON

JAMES S. GORDON, JR., an individual residing in Benton County, Washington, Plaintiff,

No. CV-04-5125-FVS ORDER

v. IMPULSE MARKETING GROUP, INC.,a Nevada Corporation, Defendant. IMPULSE MARKETING GROUP, INC., Third-Party Plaintiff, v. BONNIE GORDON, JAMES S. GORDON, III, JONATHAN GORDON, JAMILA GORDON, ROBERT PRITCHETT and EMILY ABBEY, Third-Party Defendants. BEFORE THE COURT is Impulse Marketing's Motion to Compel and Motion for Sanctions (Ct. Rec. 235); Motion to Compel and Request for Sanctions brought by Third-Party Defendants James Gordon, III, (Ct. Rec. 298), Jonathan Gordon (Ct. Rec. 300), Bonnie Gordon (Ct. Rec. 256), Robert Pritchett (Ct. Rec. 259); Amended Motion to Compel and Request for Sanctions brought by Bonnie Gordon (Ct. Rec. 274), and Jamila Gordon (Ct. Rec. 270); Defendant's Motion to Strike portions

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of the declarations the Third-Party Defendants submitted in support of their motions. (Ct. Rec. 325).

Third-Party Plaintiff Impulse Marketing ("Impulse Marketing") is represented by Floyd Ivey, Sean Moynihan, and Peter Glantz. Party Defendants are proceeding pro se. Motions to Disqualify Counsel Although the motions brought by Third-Party Defendants Bonnie and Jamila Gordon are captioned as motions to compel, these motions also request the Court disqualify Impulse Marketing's attorney Floyd Ivey. Bonnie and Jamila Gordon are the wife and daughter, Both Bonnie and Third-

respectively, of the Plaintiff, James Gordon, Jr.

Jamila Gordon allege Mr. Ivey previously represented the Plaintiff in legal matters and that this previous representation amounts to a conflict of interest. Thus, they contend Mr. Ivey should be

disqualified from representing Impulse Marketing because such representation places Mr. Ivey in conflict with the interests of Plaintiff. 1. Standing

Before the Court addresses whether Mr. Ivey's representation of Impulse Marketing presents a conflict of interest, the Court must address the threshold question of standing. Standing is a

jurisdictional matter that goes to the power of a federal court to decide an issue placed before it. The standing doctrine "embraces

several judicially self-imposed limits on the exercise of federal jurisdiction, such as the general prohibition on a litigant's raising another person's legal rights...." Allen v. Wright, 468 U.S. 737,

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750-51, 104 S.Ct. 3315, 82 L.Ed.2d 556 (1984).

Neither the United

States Supreme Court nor the Ninth Circuit has addressed the particular issue of whether the standing doctrine bars a nonclient party from moving to disqualify the opposing party's counsel on the grounds of a conflict of interest. See FMC Techs., Inc. v. Edwards, There is a

-- F. Supp. 2d --, 2006 WL 624454, *2 (W.D. Wash. 2006). split of authority on this issue.

Id. (citing Colyer v. Smith, 50

F.Supp.2d 966, 969 (C.D. Cal. 1999)). In Colyer, the district court noted that under the majority view on this issue "only a current or former client of an attorney has standing to complain of that attorney's representation of interests adverse to that current or former client." Colyer, 50 F.Supp.2d at

969 (citing In re Yarn Processing Patent Validity Litig., 530 F.2d 83, 88 (5th Cir. 1976) (stating that "courts do not disqualify an attorney on the grounds of conflict of interest unless the former client moves for disqualification.")). However, the Colyer court

acknowledged the possibility of nonclient standing where an "unethical change of sides was manifest and glaring" or an ethical violation was "open and obvious," confronting the court with a "plain duty to act." Colyer, 50 F.Supp.2d at 969 (citing Yarn Processing, Similarly, the minority view is that a nonclient See Colyer, 50 F.Supp.2d

530 F.3d at 89).

litigant may bring a motion to disqualify.

at 970-71 (citing Kevlik v. Goldstein, 724 F.2d 844 (1st Cir. 1984)). "Like the exception to the majority view, the minority view relies in part on the `court's well recognized power to control the conduct of the attorneys practicing before it.'" FMC Techs., Inc., 2006 WL

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624454,*2 (citing Colyer, 50 F.Supp.2d at 970). In addressing the standing question, the Colyer court held that a nonclient litigant "must establish a personal stake in the motion to disqualify sufficient to satisfy the irreducible constitutional minimum of Article III." FMC Techs., Inc., 2006 WL 624454, *3 Further, the Colyer court

(citing Colyer, 50 F.Supp.2d at 971).

noted that "where an ethical breach so infects the litigation in which disqualification is sought that it impacts the moving party's interest in a just and lawful determination of her claims, she may have the constitutional standing needed to bring a motion to disqualify based on a third-party conflict of interest or other ethical violation." FMC Techs., Inc., 2006 WL 624454, *3. Like the

court in Colyer, the district court in FMC Technologies, Inc. adopted the rule that "nonclient litigants may, under proper circumstances, bring motions to disqualify counsel based on conflicts of interest." 2006 WL 624454, *3. Although the Ninth Circuit has not decided the issue before the Court, the question was presented in Kasza v. Browner, 133 F.3d 1159 (9th Cir. 1998). In Kasza, the court noted that as "a general rule,

courts do not disqualify an attorney on the grounds of conflict of interest unless the former client moves for disqualification." Kasza, 133 F.3d at 1171 (quoting United States v. Rogers, 9 F.3d 1025, 1031 (2d Cir. 1983) (quoting in turn In re Yarn Processing Patent Validity Litig., 530 F.2d 83, 88 (5th Cir. 1976))). However,

the Kasza court did not decide the issue because it held there was no basis for disqualification even if the court assumed the plaintiff

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had standing.

133 F.3d at 1171.

In the present case, without making a final determination on whether it should adopt the majority or minority view, the Court is mindful of the outcome under each view. If the Court adopts the

majority view, Third-Party Defendants Bonnie and Jamila Gordon do not have standing to move to disqualify Mr. Ivey. If the Court adopts

the minority view, Bonnie and Jamila Gordon, under the proper circumstances, have standing to bring a motion to disqualify Mr. Ivey based on an alleged conflict of interest between Plaintiff and Mr. Ivey. Under the minority view, Bonnie and Jamila Gordon must show

"the ethical conflict at issue here sufficiently impacts the `just and lawful determination' of their claims and that the conflict involved is so intertwined with the current litigation that this Court must consider [the] motion to disqualify[.]" 2006 WL 624454, *3. FMC Techs., Inc.,

Assuming, without deciding, that Bonnie and

Jamila have standing to bring this motion to disqualify, the Court proceeds to review the merits of the motion. 2. Disqualification of Floyd Ivey

When faced with an allegation that an attorney's representation presents a conflict of interest, it is "the duty of the district court to examine the charge, since it is that court which is authorized to supervise the conduct of the members of its bar." Gas-

A-Tron of Ariz. v. Union Oil Co. of Calif., 534 F.2d 1322, 1324 (9th Cir. 1976). The Local Rules for the Eastern District of Washington

do not specifically adopt the provisions of the Washington Rules of Professional Conduct as ethical rules governing the practice of

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lawyers before the courts in this district.

However, the Local Rules

grant the Court authority to discipline any attorney who violates the Washington Rules of Professional Conduct.1 Thus, the Washington

Rules of Professional Conduct shall govern the Court's disqualification analysis. Here, Bonnie Gordon alleges Mr. Ivey participated in numerous conversations with the Plaintiff regarding spamming, including conversation related to Impulse Marketing. Further, she points to

several emails in which Mr. Ivey and the Plaintiff communicated about the possibility of Mr. Ivey assisting the Plaintiff in filing lawsuits for violations of Washington's anti-spam statute. Mr. Ivey

acknowledges he provided legal services to the Plaintiff in the past, but contends those services were unrelated to the pending litigation. With respect to the current litigation, Mr. Ivey contends his communication with the Plaintiff included an exchange of general statements, but there was never any formal representation. These allegations implicate Rule 1.9 of the Rules of Professional Conduct, which states: A lawyer who has formerly represented a client in a matter shall not thereafter: (a) 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 unless the former client consents in writing after consultation and a full disclosure of the material facts; or

See LR 83.3 ("This Court may impose discipline on any attorney practicing before this Court, ... who engages in conduct violating applicable Rules of Professional Conduct of the Washington State Bar, or who fails to comply with the rules or orders of this Court."). ORDER - 6

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(b) Use confidences or secrets relating to the representation to the disadvantage of the former client, except as rule 1.6 would permit. Wash. Rules of Prof'l Conduct R. 1.9 (2005). Under Rule 1.9(a), the

significant elements include (1) whether the conflict involves a former client; (2) whether the subsequent representation is materially adverse to the former client; and (3) whether the matters are substantially related. 994, 998 (9th Cir. 1980). Here, it is clear Plaintiff has not consented to Mr. Ivey's representation of Impulse Marketing, but it is not clear whether Plaintiff was ever a "former client" of Mr. Ivey. Assuming, without Id; see also Trone v. Smith, 621 F.2d

deciding, that Plaintiff was a former client of Mr. Ivey, Bonnie and Jamila Gordon must also show the matters currently at issue are substantially related to the subject matter of the former representation. Sanders v. Woods, 121 Wash.App. 593, 597-98, 89 P.3d

312 (Div. 3, 2004); Trone, 621 F.2d at 996 ("The relevant test for disqualification is whether the former representation is "substantially related" to the current representation.") The

determination of whether the two representations are substantially related turns on whether the lawyer was so involved in the former representation that he can be said to have switched sides. 121 Wash.App. at 598, 89 P.3d 312. Here, the facts of the case reveal that on September 22, 2003, Plaintiff sent Mr. Ivey an unsolicited email in which Plaintiff outlined the procedural steps he had taken to reduce the spam he had been receiving. Plaintiff also explained in this email that he had Sanders,

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drafted a complaint and was "seeking an attorney to `perfect' [his] complaint so that [he could] file it in District Court." 283-2, at 52.). (Ct. Rec.

In the alternative, Plaintiff stated he "may want to Id. (emphasis added).

hire an attorney to represent [him] in court."

In response, Mr. Ivey said he was interested but encouraged Plaintiff to contact the Attorney General. Id. In response, Plaintiff

forwarded Mr. Ivey a copy of an email Plaintiff previously sent to the Attorney General. In the email to the Attorney General,

Plaintiff explained he had received over 12,000 unsolicited commercial email (spam) in the past month, that he had successfully identified the origin of some of those emails, and that he had sent demand letters to the senders, citing the Washington anti-spam statute. Plaintiff suggested to the Attorney General that the State

of Washington "turn this proverbial lemon into lemonade­-making spam a "profit center" for the State of Washington as well as other organizations within the State." (Ct. Rec. 283-2, at 56).

On September 25, 2003, Plaintiff sent another email to Mr. Ivey. (Ct. Rec. 283-2, at 57). Plaintiff explained that the amount of spam

he was receiving was becoming an imposition on his business and on his personal use of the internet and that he believed Washington's anti-spam statute was designed to prevent the "abuse" he was experiencing. Id. Plaintiff closed his email by thanking Mr. Ivey Id. at 58. Mr. Ivey responded by

for considering the issues.

stating that his attorney services would cost $225 per hour and that he could not guarantee a solution. Mr. Ivey closed his email by

stating there would be a "real budget needed ... to commence the

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effort. forward."

Please advise if you want to examine the prospect of going Id. at 57.

On September 30, 2003, Plaintiff sent another email to Mr. Ivey, in which Plaintiff explained that he had email documentation showing the violations he alleged and had drafted two complaints. 295-1, at 15). (Ct. Rec.

Plaintiff asked Mr. Ivey how he would like to proceed Id. Plaintiff's

and requested Mr. Ivey identify the proposed costs. next email is dated December 30, 2003.

(Ct. Rec. 295-1, at 17).

From the context of that email, it appears Plaintiff chose to proceed pro se and filed the complaints in superior court against two companies. In the email, Plaintiff told Mr. Ivey that a superior

court had granted Plaintiff's request for temporary restraining orders against these two companies. Id. Plaintiff asked Mr. Ivey if

he was still interested and in what way he envisioned assisting the Plaintiff. Id. Beyond these emails, the record does not reveal any

other contact between Mr. Ivey and Plaintiff. After reviewing these emails, the Court concludes Mr. Ivey's representation of Impulse Marketing is not substantially related to any previous representation of Plaintiff. The emails reveal Mr. Ivey

never offered any formal legal advice and never reviewed any legal pleadings for Plaintiff. Further, it appears Plaintiff declined to

examine the prospect of hiring Mr. Ivey and chose instead to proceed pro se with his anti-spam case. In determining whether a conflict of

interest exists, the "underlying concern is the possibility, or the appearance of the possibility, that the attorney may have received confidential information during the prior representation that would

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be relevant to the subsequent matter in which disqualification is sought." Sanders, 121 Wash.App. at 599, 89 P.3d 312. Here, the

emails produced by Mr. Ivey show no confidential information was disclosed. Further, Bonnie and Jamila Gordon have not presented any

evidence providing even the appearance of the possibility that confidential information was disclosed. For these reasons, the Court

determines Mr. Ivey's representation of Impulse Marketing does not present a conflict of interest. Therefore, Bonnie and Jamila

Gordon's motions to disqualify Floyd Ivey are denied. Impulse Marketing's "Second" Motion to Compel On April 18, 2006, Impulse Marketing re-noted for hearing its "First Motion to Compel." The Court previously denied this motion to

compel, directing the parties to meet and confer in an attempt to resolve their discovery problems. It is not clear from the record

whether the parties did in fact "meet and confer" but Impulse Marketing continues to argue Plaintiff is not providing adequate responses to Defendant's discovery requests. Plaintiff objects to

the motion to compel, arguing the alleged "deficiencies" in Plaintiff's responses are actually Impulse Marketing's "improper demands." The Court determines it is appropriate and necessary to

refer the parties' discovery dispute to a discovery master. Therefore, Impulse Marketing's motion to compel is denied and an Order referring this matter to a discovery master will be forthcoming. Third-Party Defendants' Motions to Compel and for Sanctions Third-Party Defendants each allege Impulse Marketing failed to

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make the "required Rule 26 disclosures" and "provided evasive, incomplete disclosure, answer, or response to discovery propounded by" [sic] Third-Party Defendants. In support of their motions to

compel, Third-Party Defendants provided copies of some of their interrogatories and Impulse Marketing's answers. In response to many

of Third-Party Defendants' interrogatories, Impulse Marketing asserted the standard ambiguous, irrelevant and overbreadth objections. Because Third-Party Defendants failed to cite any legal

authority or provide any legal analysis in response to Impulse Marketing's objections to the propounded discovery requests, it is difficult for the Court to analyze and resolve the discovery dispute. Thus, the Court determines it is necessary to refer the parties' discovery dispute to a discovery master. Therefore, Third-Party

Defendants' motions to compel are denied and an order referring this matter to a discovery master will be forthcoming. IT IS HEREBY ORDERED: 1. Impulse Marketing's Motion to Compel and Motion for Accordingly,

Sanctions (Ct. Rec. 235) is DENIED. 2. Motions to Compel and Request for Sanctions brought by

Third-Party Defendants James Gordon, III, (Ct. Rec. 298), Jonathan Gordon (Ct. Rec. 300), Bonnie Gordon (Ct. Rec. 256), Robert Pritchett (Ct. Rec. 259) are DENIED. 3. Amended Motions to Compel and Request for Sanctions brought

by Bonnie Gordon (Ct. Rec. 274) and Jamila Gordon (Ct. Rec. 270) are DENIED; Bonnie and Jamila Gordon's request to disqualify Floyd Ivey are denied.

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4. 5. 6. 7. 8.

Defendant's Motion to Strike (Ct. Rec. 325) is MOOT. Bonnie Gordon's Motion to Expedite (Ct. Rec. 337) is MOOT. Bonnie Gordon's Motion to Strike (Ct. Rec. 339) is MOOT. Jamila Gordon's Motion to Expedite (Ct. Rec. 342) is MOOT. Jamila Gordon's Motion to Strike (Ct. Rec. 344) is MOOT. The District Court Executive is hereby

IT IS SO ORDERED.

directed to enter this Order and furnish copies to counsel AND to the Third-Party Defendants who are proceeding pro se. DATED this 15th day of May, 2006. s/ Fred Van Sickle Fred Van Sickle United States District Judge

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