Opinion ID: 540349
Heading Depth: 2
Heading Rank: 1

Heading: Failure to Stand Recused

Text: 6 The appellants contend that Judge Roberts, who shortly after making his May 8 and June 26 orders received and accepted an offer for partnership in the law firm representing Continental, should have stood recused from the case and that his failure to do so requires the reversal of those orders. 7 Several months before making his rulings in this case, Judge Roberts had announced his intentions to enter private practice and to stop handling the Continental bankruptcy cases to avoid conflicts of interest in the event he considered employment with any of the firms appearing before him. Shortly thereafter, Continental's local bankruptcy counsel, Messrs. Sheinfeld, Maley & Kay (Sheinfeld), discussed hiring Judge Roberts at a partnership meeting. Before his confirmation of Continental's plan of reorganization, at least two Sheinfeld lawyers had asked Judge Roberts about his future employment plans. At about the same time, Judge Roberts was quoted as praising Continental's President Frank Lorenzo in articles which appeared in Business Week and the Wall Street Journal. 1 8 Judge Roberts granted summary judgment disallowing all contract rejection damage claims in orders made on May 8 and June 26, 1986, and confirmed Continental's plan of reorganization on June 30. On July 1, Judge Roberts granted various fee requests made by counsel, including a $700,000 fee to Sheinfeld. On July 2, Sheinfeld contacted Judge Roberts about joining their partnership. On July 29, Judge Roberts agreed to join the firm and did so on September 5 of the same year. 9 28 U.S.C. Section 455(a) requires a judge to stand recused in any proceeding in which his impartiality might reasonably be questioned. Because the goal of Section 455(a) is to exact the appearance of impartiality, recusal may be mandated even though no actual partiality exists. Hall v. Small Business Admin., 695 F.2d 175, 178 (5th Cir.1983). The standard for recusal is an objective one, that if a reasonable man, were he to know all the circumstances, would harbor doubts about the judge's impartiality. Health Services Acquisition Corp. v. Liljeberg, 796 F.2d 796, 800 (5th Cir.1986), aff'd, 486 U.S. 847, 108 S.Ct. 2194, 100 L.Ed.2d 855 (1988). 10 In the present case there is no allegation that, prior to his rulings in this case, Judge Roberts had sought employment with the Sheinfeld firm, or that he knew that the firm was actively considering him. The close coupling of Judge Roberts's rulings with the employment offer and his acceptance of it, however, does create the appearance that he may have been pursuing employment with Sheinfeld while he was presiding over the case. As the Seventh Circuit noted in Pepsico, Inc. v. McMillen, 764 F.2d 458, 461 (7th Cir.1985): 11 The appearance of equal justice requires that the judge not be exploring the prospects of employment with one lawyer or all lawyers appearing in a case before him. The dignity and independence of the judiciary are diminished when the judge comes before the lawyers in the case in the role of a suppliant for employment. The public cannot be confident that a case tried under such conditions will be decided in accordance with the highest traditions of the judiciary. 12 Id. at 461. 13 Continental contends that a judge cannot be expected to stand recused in a case when he is unaware that counsel for one of the parties appearing before him is considering him for employment. The Supreme Court, in Liljeberg v. Health Services Corp., responded to a similar contention: 14 Contrary to petitioner's contentions, this reading of the statute does not call upon judges to perform the impossible--to disqualify themselves based on facts they do not know. If, as petitioner argues, Sec. 455(a) should only be applied prospectively, then requiring disqualification based on facts the judge does not know would of course be absurd; a judge could never be expected to disqualify himself based on some fact he does not know, even though the fact is one that perhaps he should know or one that people might reasonably suspect that he does know. But to the extent the provision can also, in proper cases be applied retroactively, the judge is not called upon to perform an impossible feat. Rather, he is called upon to rectify an oversight and to take the steps necessary to maintain public confidence in the impartiality of the judiciary. If he concludes that his impartiality might reasonably be questioned, then he should also find that the statute has been violated. This is certainly not an impossible task. 15 486 U.S. 847, 861, 108 S.Ct. 2194, 2202-03, 100 L.Ed.2d 855, 873 (1988). Similarly, to hold that Sec. 455(a) was violated in the present case does not mean that Judge Roberts was required to stand recused before discovering that he was being considered for employment. Rather, when an offer of employment was received the day after his approval of $700,000 in legal fees to the firm making the offer, Judge Roberts was required to take the steps necessary to maintain public confidence in the judiciary. In the circumstances of this case Judge Roberts should either have rejected the offer outright, or, if he seriously desired to consider accepting the offer, stood recused and vacated the rulings made shortly before the offer was made. Although we are confident that Judge Roberts committed no substantive impropriety in his handling of the motions in this case, we nevertheless conclude that recusal was mandated by the appearances of the situation which we have described. 16 Although a violation of Sec. 455(a) has occurred in the present case, reversal is not automatic. As with other areas of the law, the harmless error rule applies to a breach of a judge's duty to stand recused under Sec. 455(a). Liljeberg, 486 U.S. at 861-62, 108 S.Ct. at 2202-03, 100 L.Ed.2d at 873-74. In determining whether reversal is mandated by a failure to stand recused, a number of factors warrant our careful consideration: The risk of injustice to the parties in this particular case; the risk that the denial of relief will produce injustice in other cases; the risk of undermining the public's confidence in the judicial process. Id. at 864, 108 S.Ct. at 2204, 100 L.Ed.2d at 875. 17 The risk of injustice to the parties in allowing a summary judgment ruling to stand is usually slight. Such rulings are subject to de novo review, with the reviewing court utilizing criteria identical to that used by the court below. In cases where we would otherwise affirm such a ruling, little would be gained by vacating and remanding with instructions that it be essentially reinstated. 2 18 Next, we consider whether a failure to vacate the orders below would be likely to produce injustice in other cases. We seriously doubt that a failure to vacate the decisions of the bankruptcy court could be read in future cases as a nod of approval for Judge Roberts's handling of the situation; rather, our ruling here should serve as a caution to other judges who are contemplating private employment following retirement. Moreover, were we to vacate the orders below for the Sec. 455 violation alone, injustice to other Continental creditors might result from the delay in finishing Continental's plan of reorganization. 19 Finally, we consider whether the public's confidence in the judicial process will be undermined if we hold Judge Roberts's violation of Section 455(a) to be harmless error. We are aware of the high profile the Continental bankruptcy has had before the public and that the circumstances surrounding Judge Roberts's retirement from the bench have not gone unnoticed by the press. 3 That we have ruled Judge Roberts's actions to be violative of Section 455(a) should serve to restore some of any public confidence lost as a result of the violation; whether vacating the orders granting summary judgment for the sake of appearances alone would help or hinder the restorative process, however, is not clear. As the Eleventh Circuit has noted, in similar circumstances: 20 In fact, if we reverse and vacate a decision that we have already determined to be proper, the public will lose faith in our system of justice because the case will be overturned without regard to the merits of the employees' claims. Judicial decisions based on such technical arguments not relevant to the merits contribute to the public's distrust in our system of justice. 21 Parker v. Connors Steel Co., 855 F.2d 1510, 1527 (11th Cir.1988), cert. denied, --- U.S. ----, 109 S.Ct. 2066, 104 L.Ed.2d 631 (1989). We accordingly hold that the Section 455(a) violation in the present case constituted harmless error.