Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-cand-3_04-cv-03932/USCOURTS-cand-3_04-cv-03932-6/pdf.json

Nature of Suit Code: 470
Nature of Suit: Civil (Rico)
Cause of Action: 18:1962 Racketeering (RICO) Act

---

1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

United States District Court

For the Northern District of California

IN THE UNITED STATES DISTRICT COURT

FOR THE NORTHERN DISTRICT OF CALIFORNIA

UKIAH AUTOMOTIVE INVESTMENTS,

Plaintiff,

 v.

MITSUBISHI MOTORS OF NORTH

AMERICA, INC., et al.,

Defendants ___________________________________

MITSUBISHI MOTORS CREDIT OF

AMERICA, INC.,

Counterclaimant

 v.

UKIAH AUTOMOTIVE INVESTMENTS,

Counterdefendant ___________________________________

MITSUBISHI MOTORS CREDIT OF

AMERICA, INC.,

Cross-claimant

 v.

THOMAS COGLIANO,

Cross-defendant ___________________________________

UKIAH AUTOMOTIVE INVESTMENTS,

Counterclaimant, and

THOMAS COGLIANO,

Cross-claimant

 v.

MITSUBISHI MOTORS OF NORTH

AMERICA, INC., et al.

Counterdefendants and crossdefendants /

No. 04-3932 MMC 

ORDER DENYING THIRD PARTY’S

MOTION TO DISQUALIFY AND FOR A

PROTECTIVE ORDER; VACATING

HEARING

Case 3:04-cv-03932-MMC Document 149 Filed 11/17/05 Page 1 of 4
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

1

Defendant Mitsubishi Motors Credit of America, Inc. (“Mitsubishi”) has filed a

response, stating, inter alia, it does not oppose the motion.

2

Because Myers no longer represents Ukiah, Korman’s motion as it pertains to

Myers is moot. Ukiah is presently represented by Dennis C. Birkhimer (“Birkhimer”) and

Eric Wildgrube (“Wildgrube”). Ukiah and Korman dispute Korman’s assertion that

Birkhimer personally represented Korman. Ukiah and Korman also dispute Korman’s

contention that any conflict occasioned by Myer’s prior representation of Korman should be

imputed to Birkhimer and Wildgrube. In light of the Court’s findings infra, the Court does

not address either of these issues.

2

Before the Court is the motion, filed October 11, 2005 by Michael Korman

(“Korman”), a potential witness in the above-titled action, to disqualify counsel of record for

plaintiff and for a protective order. Plaintiff Ukiah Automotive Investments and crossdefendant Thomas Cogliano (collectively, “Ukiah”) have filed opposition, to which Korman

has filed a reply.1 Having reviewed the papers filed in connection with the motion, the

Court deems the matter suitable for decision on the papers, VACATES the hearing

scheduled for November 18, 2005, and rules as follows.

A. Motion to Disqualify

Ukiah’s former counsel Myers & Fuller, P.A. (“Myers”) represented Korman in the

course of an action between Korman and Mitsubishi, which action was resolved by a

Settlement Agreement and Release (“Settlement Agreement”). In the instant action,

Mitsubishi, joined by Ukiah, has served Korman with a deposition subpoena. (See

Thorndal Decl., filed October 11, 2005, Ex. B.) Korman argues that Korman’s interest in

complying with a confidentiality provision in the Settlement Agreement is adverse to Ukiah’s

interest in obtaining Korman’s testimony as a witness, and, that consequently, Ukiah’s

counsel should be disqualified.2 See Cal. Rule Prof. Conduct R. 310(E) (providing attorney

shall not, without consent of former client, accept employment “adverse” to former client). 

Korman argues that the Settlement Agreement contains a “‘gag order’ which precludes the

parties to the agreement from discussing the Korman/Mitsubishi relationship with anyone,”

(see Korman’s Mem. of P. & A., filed October 11, 2005, at 2:9-10), and thus that his prior

counsel owes him a duty not to elicit his testimony in the instant action in contravention of

such provision. As a result, Korman concludes, a conflict has arisen between counsel’s

Case 3:04-cv-03932-MMC Document 149 Filed 11/17/05 Page 2 of 4
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

3

Korman does not contend his interests are otherwise in conflict with those of Ukiah.

4

The Settlement Agreement has been filed under seal in the instant action.

5

Indeed, Mitsubishi, the other party to the Settlement Agreement, understands the

confidentiality clause to “provide[ ] that Mr. Korman may be compelled to disclose

information ‘to the extent required by order or legal process issued by a court.’” (See Pinch

Decl., filed October 28, 2005, ¶ 9.)

3

duty to present evidence on behalf of Ukiah and counsel’s duty not to elicit such evidence

from Korman.3

The Court, having reviewed the terms of the Settlement Agreement,4 finds the

subject confidentiality provision, when read in context, simply prohibits the parties thereto

from disclosing the settlement itself, i.e., its terms, both financial and otherwise, and the

negotiations in connection therewith. (See Settlement Agreement, filed under seal

November 15, 2005, ¶ 30.) The Settlement Agreement does not prohibit either Korman or

Mitsubishi from discussing facts and events of which either has knowledge independent of

the settlement and the negotiations pertaining thereto. In short, and contrary to Korman’s

description of the Settlement Agreement as containing a “gag order,” nothing in the

Settlement Agreement purports to preclude Korman from testifying as a witness in another

action involving Mitsubishi, other than as to the terms and conditions of the Settlement

Agreement itself and the negotiations conducted in connection therewith.5

In the instant case, any evidence pertaining to the Settlement Agreement, including

any discussions concerning the Settlement Agreement, would be inadmissible. See Fed.

R. Evid. 408. Moreover, there is no indication in any paper filed by Ukiah, Mitsubishi, or

Korman that the Settlement Agreement is germane to the instant action. In sum, Korman

has failed to demonstrate a conflict exists between the duty of Ukiah’s counsel to represent

Ukiah in this action and any duty Ukiah’s counsel has with respect to Korman. See

McPhearson v. Michaels Co., 96 Cal. App. 4th 843, 848 (2002) (“Because the

confidentiality clause did not, and could not, preclude [the former client] from testifying as a

percipient witness to events concerning plaintiff, the perceived conflict is more apparent

than real.”)

Case 3:04-cv-03932-MMC Document 149 Filed 11/17/05 Page 3 of 4
1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

6

In the alternative, Korman seeks an order providing for a deposition “only on terms

the Court deems just under the circumstances.” (See Korman’s Mem. of P. & A. at 16.) 

As, to date, no dispute as to the parameters of such deposition has been called to the

Court’s attention, the Court declines to issue a limiting order at this time.

4

Accordingly, the motion to disqualify will be denied.

B. Motion for Protective Order

Korman argues that, irrespective of whether Ukiah’s counsel is disqualified, Korman

is entitled to an order precluding the parties from calling him as a witness. Korman asserts

that he has a right to rely on the terms of the Settlement Agreement, which, as noted, he

characterizes as a “gag order.” Even assuming a potential witness could rely on a

privately-negotiated “gag order” to avoid giving relevant and otherwise admissible

testimony, an unlikely situation, see id. (noting such provision would be “contrary to public

policy”), here the Settlement Agreement contains no such provision. Consequently,

Korman is not entitled to the protective order he seeks.6

CONCLUSION

For the reasons stated, Korman’s motion to disqualify Ukiah’s counsel and for a

protective order is hereby DENIED.

IT IS SO ORDERED.

Dated: November 17, 2005 

MAXINE M. CHESNEY

United States District Judge

Case 3:04-cv-03932-MMC Document 149 Filed 11/17/05 Page 4 of 4