Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-ared-3_03-cv-00259/USCOURTS-ared-3_03-cv-00259-0/pdf.json

Nature of Suit Code: 190
Nature of Suit: Other Contract Actions
Cause of Action: 28:1332 Diversity-Other Contract

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IN THE UNITED STATES DISTRICT COURT

EASTERN DISTRICT OF ARKANSAS

JONESBORO DIVISION

GENLABS PLAINTIFF

Case Number: 3:03CV00259GH

VALUE HOME PRODUCTS, LLC., ET AL. 

DEFENDANTS

ORDER

Pending before the Court is the motion of Thomas A. Young and James C.

Hale, III, to withdraw as counsel for defendants. Plaintiff objects to the request.

On August 22, 2003, Genlabs filed this action for breach of contract and fraud.

The individual defendants and the corporate defendant Value Home Products each

filed an answer; Value Home Products filed a counterclaim. The individual and

corporate defendants were represented by Paul James of James & Carter, PLC and

James C. Hale, III, of the Hale Law Firm. On December 17, 2003, the Court issued

a scheduling order setting the case for trial on August 9, 2004. 

On March 22, 2004, defendants filed a motion for enlargement of time to

respond to discovery requests and a motion for protective order. Counsel for

defendants filed a motion to withdraw. The motions contended that the individual

defendants had developed a conflict of interest, that their legal positions were adverse

to each other and that they refused to agree to a waiver of the conflict. Counsel also

alleged that defendants had failed to substantially fulfill their financial obligation to

the law firms. Defendants requested an extension of time to retain new counsel and

to respond to discovery requests.

The Court, by Order entered April 7, 2004, granted the motion to withdraw,

granted defendants fifteen days to obtain substitute counsel and twenty days

thereafter to respond to the discovery requests. 

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On May 26, 2004, defendants, through their attorney Paul James of James &

Carter, PLC, filed a motion for continuance and extension of time. Counsel stated

that he and defendants had had numerous conferences, and that defendants had been

unable to find alternative counsel. Defendants had executed waivers of their

respective conflicts of interest and retained James to represent them. Therefore, the

law firm of James & Carter, PLC, entered their appearance as counsel but asked that

the August 9th trial date be continued to allow defendants to adequately prepare for

trial. Plaintiff objected to defendants’ request for continuance of the August 9th trial

date, stating that the request was a delay tactic of defendants. 

On June 10, 2004, the Court entered an Order granting defendants’ motion for

continuance. A new scheduling order filed January 19, 2005, set the jury trial for

August 15, 2005. 

On February 7, 2005, defendants filed a motion to withdraw and substitute

counsel. Defendants requested that James & Carter, PLC, be allowed to withdraw

as counsel and that Hale, Holitik, & Young, formerly known as the Hale Law Firm,

be substituted as sole counsel for defendants. Plaintiff had no objection to the request

and the Court granted the motion on February 15, 2005.

On June 17, 2005, plaintiff filed a motion to compel, stating that defendants

have failed to respond to plaintiff’s second set of requests for production of documents.

Defendants have not responded to the motion, which remains pending.

On July 7, 2005, defendants’ counsel, Young and Hale filed a motion to

withdraw. They state that during a June 23, 2005, meeting, it became clear to

counsel that a conflict existed between the separate defendants regarding possible

defenses and the possibility of cross-claims being filed. Counsel advised the

individual defendants that they needed to retain separate attorneys to represent

them and that because of the conflict Hale and Young would be forced to withdraw.

Counsel state that they were only made aware of the conflict on June 23, 2005.

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Plaintiff objects, stating that allowing defense counsel to withdraw would be

prejudicial to plaintiff, as it would delay the trial. Furthermore, plaintiff states that

counsel were previously aware of a conflict of interest, that the defendants had

waived it, and that counsel should be bound to their representation.

The Court will not permit defendants to once again raise “conflict of interest”

as a ploy to continue this trial. Defense counsel were well aware of a possible conflict

of interest when they initially represented defendants almost 2 years ago. The time

has long passed for defendants to be allowed leave to file cross-claims, and defendants

have failed to do so. There is no indication by counsel as to how the “newly

discovered” conflict differs in substance from that previously known to them.

The Court will not continue the August 9th trial. The Court will not require

counsel to remain on the case if representation is clearly violative of the Code of

Professional Conduct. It is unclear from the motion and history of this case whether

withdrawal is warranted under the circumstances. If counsel cannot represent

defendants, then counsel should make arrangements for substitute counsel to appear

with defendants at the August 9th trial. The Court will then reconsider the motion

to withdraw. Defendants are expected to appear at trial, either with newly retained

counsel., counsel who currently represent them, or pro se. The August 9th trial will

proceed as previously scheduled.

The motion to compel is granted. Defendants shall provide the documents

requested within eleven days of the date of this Order.

Accordingly, the motion to withdraw is denied without prejudice to renew, the

motion to compel is granted.

IT IS SO ORDERED this 18th day of July, 2005.

___________________________________

UNITED STATES DISTRICT JUDGE

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