Court Opinion

ID: 2782972
Source: CourtListenerOpinion
Date Created: 2015-02-27 20:02:21.542304+00
Date Added: 2024-06-11T12:45:07.910956
License: Public Domain

Filed 2/27/15 United Farm Workers of America v. La Union Es Para Todoa Staff Union CA6
                      NOT TO BE PUBLISHED IN OFFICIAL REPORTS
California Rules of Court, rule 8.1115(a), prohibits courts and parties from citing or relying on opinions not certified for
publication or ordered published, except as specified by rule 8.1115(b). This opinion has not been certified for publication
or ordered published for purposes of rule 8.1115.

              IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA

                                      SIXTH APPELLATE DISTRICT

UNITED FARM WORKERS OF                                               H039997
AMERICA,                                                            (Monterey County
                                                                     Super. Ct. No. M123292)
         Plaintiff and Appellant,

         v.

LA UNION ES PARA TODOS STAFF
UNION et al.,

         Defendants and Respondents.

         In this appeal we explore the axiom that “a lawyer owes no general duty of
confidentiality to nonclients.” (DCH Health Services Corp. v. Waite (2002) 95
Cal. App. 4th 829, 832 (DCH).) Plaintiff United Farm Workers of America challenges the
denial of its motion to disqualify the law firm L+G, LLP and its attorneys (collectively,
L+G) from representing defendants La Union Es Para Todos Staff Union, Francisco
Cerritos, Armando Lopez, Doroteo Lopez and Jose Aguilar in plaintiff’s breach of
contract action to enforce its collective bargaining agreement with defendants. Plaintiff
argues that the trial court erred in denying the motion because L+G has conflicts of
interest arising out of concurrent representation of clients with conflicting interests or,
alternatively, successive representation of clients with conflicting interests. For the
reasons stated here, we find no abuse of discretion and will affirm for lack of any
confidential relationship between plaintiff and L+G.
                          I.   TRIAL COURT PROCEEDINGS
       Plaintiff is an unincorporated labor organization which represents agricultural
employees in California and other states. Some of plaintiff’s nonsupervisory employees
formed defendant La Union Es Para Todos Staff Union (La Union) in 2013 and, after
mediation, the parties entered into a collective bargaining agreement on May 1, 2013,
which plaintiff formally recognized by letter dated May 20, 2013. On May 16, 2013,
plaintiff terminated defendant Francisco Cerritos’s employment. Cerritos is an officer of
La Union and, before his termination, was allegedly responsible for administering
plaintiff’s collective bargaining agreement with strawberry grower Dole Berry North in
Monterey County. That day, defendants allegedly “openly picketed, entered onto
[plaintiff’s] office structures, and demanded reinstatement of ... Cerritos.”
       Plaintiff filed a complaint alleging breach of contract against La Union, Cerritos,
two individuals employed under plaintiff’s union contract with Dole Berry North, and
Armando Lopez, who worked for plaintiff and was an officer of La Union. Plaintiff
complained that defendants’ picketing violated the “No Strike Clause” of the collective
bargaining agreement between plaintiff and La Union and sought an injunction to enforce
that clause.
       Plaintiff moved to disqualify L+G from representing defendants, arguing that L+G
“has established an attorney-client relationship with current and former ... employees” of
plaintiff, which would give L+G access to “a wealth of privileged and highly confidential
information” about plaintiff’s internal operations and procedures, including information
about plaintiff’s union organizing campaigns directed toward existing and potential
clients of L+G. Plaintiff argued disqualification was required due to the alleged conflict
of interests between La Union and L+G’s other clients. The trial court denied plaintiff’s
motion.

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                                    II.    DISCUSSION
   A. STANDARD OF REVIEW
         Authority to disqualify attorneys is found in Code of Civil Procedure section 128,
subdivision (a)(5), which grants a trial court the power to “control in furtherance of
justice, the conduct of its ministerial officers, and of all other persons in any manner
connected with a judicial proceeding before it, in every matter pertaining thereto.” (Code
Civ. Proc., § 128, subd. (a)(5); Dino v. Pelayo (2006) 145 Cal. App. 4th 347, 351 (Dino).)
“An order denying a disqualification motion is appealable either as an order refusing to
grant an injunction to restrain counsel from participating in the case (Code Civ. Proc., §
904.1, subd. (a)(6)) or as a final order on a collateral matter (Meehan v. Hopps (1955) 45
Cal. 2d 213, 215-217).” (Roush v. Seagate Technology, LLC (2007) 150 Cal. App. 4th 210,
218.) We review a trial court’s denial of a motion to disqualify an attorney for abuse of
discretion and will not “substitute [our] factual findings for the trial court’s express or
implied findings so long as they are supported by substantial evidence.” (Dino, at p.
351.) Plaintiff urges that a de novo standard of review applies when there are no disputed
material facts, (citing Banning Ranch Conservancy v. Superior Court (2011) 193
Cal. App. 4th 903, 910-911), but because material facts are in dispute here, including for
example the relationship between plaintiff, La Union, and L+G, we review for an abuse
of discretion.
   B. RELATIONSHIP BETWEEN PLAINTIFF AND L+G
         Defendants argue that plaintiff does not have “standing” to seek L+G’s
disqualification because plaintiff lacks “a legally cognizable interest to disqualify
opposing counsel.” Plaintiff counters that defendants cite “no case law whatsoever” to
support their challenge to plaintiff’s standing. Plaintiff overlooks Great Lakes
Construction, Inc. v. Burman (2010) 186 Cal. App. 4th 1347 (Great Lakes), which notes
that “a ‘standing’ requirement is implicit in disqualification motions.” (Great Lakes, at p.
1356.)
                                               3
       Though the parties and certain published opinions (including Great Lakes, supra,
186 Cal.App.4th at p. 1356) discuss a non-client’s ability to disqualify an attorney as a
matter of “standing,” the characterization is technically incorrect because “standing refers
to an aggrieved party’s right to bring an action in the first instance, rather than an existing
party’s right to bring a motion seeking some sort of relief from the trial court.” (Dino,
supra, 145 Cal.App.4th at p. 353, fn. 2.) Like the Dino court, we need not decide
whether the issue is properly framed as one of standing. (Id. at p. 353.) We review the
record to determine whether plaintiff had a sufficient relationship with L+G to prevail on
a motion to disqualify the firm.
       “Generally, before the disqualification of an attorney is proper, the complaining
party must have or have had an attorney-client relationship with that attorney.” (Dino,
supra, 145 Cal.App.4th at p. 352.) Even without an explicit attorney-client relationship,
a party may successfully move to disqualify an attorney if “some sort of confidential or
fiduciary relationship” exists between the attorney and the party moving for
disqualification, the existence of which is a question of fact. (Id. at p. 353.) And “where
[an] ethical breach is ‘manifest and glaring’ and so ‘infects the litigation in which
disqualification is sought that it impacts the moving party’s interest in a just and lawful
determination of [his or] her claims’ [citation], a non-client might [be authorized] to bring
a motion to disqualify based upon a third-party conflict of interest or other ethical
violation.” (Great Lakes, supra, 186 Cal.App.4th at p. 1357.) To assert a third party
claim, “the non-client must meet stringent ... requirements, that is, harm arising from a
legally cognizable interest which is concrete and particularized, not hypothetical.” (Id. at
p. 1358.)
            1. Plaintiff and L+G Have No Direct Confidential Relationship
       Plaintiff does not claim an attorney-client relationship exists directly between
plaintiff and L+G or that it has a confidential or fiduciary relationship with L+G. To the

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contrary, the thrust of plaintiff’s argument is that L+G consistently represents “clients
with interests directly adverse to” plaintiff.1
       An argument similar to plaintiff’s was rejected in DCH, supra, 95 Cal. App. 4th
829. There, DCH Health Services Corporation, Downey Community Hospital
Foundation, Carl Westerhoff, and several other plaintiffs sued Verner Waite for
defamation. When the complaint was filed, Los Angeles Superior Court Judge Ana Luna
was a member of the board of directors of the hospital foundation and was also engaged
to marry attorney Randy Kramer. Luna resigned from the board and married Kramer,
who was later retained by Waite to defend him in the defamation case. The trial court
granted Westerhoff’s motion to disqualify Kramer because of his relationship with Luna.
(Id. at p. 831.) The appellate court reversed, finding that “[n]one of the plaintiffs assert
the existence of a current or former lawyer-client relationship with Kramer or a
confidential relationship between themselves and Luna. Absent the existence of a
lawyer-client relationship or other relationship imposing a duty of confidentiality, neither
Westerhoff nor the [other plaintiffs] were entitled to seek Kramer’s disqualification.” (Id.
at p. 833.)
       Like the plaintiffs in DCH, plaintiff here does not assert the existence of a current
or former attorney-client or confidential relationship with L+G. Plaintiff also makes no

       1
          Plaintiff requests that we take judicial notice of an amicus curiae brief filed by
the Western Growers Association and other groups related to an appeal in the Fifth
Appellate District in which plaintiff is a real party in interest, arguing that it is relevant to
show that the Western Growers Association, for whom L+G has worked, represents
interests adverse to the UFW. However, there is no indication L+G had any involvement
with drafting the amicus brief, making it irrelevant to this case. Even if the brief had
some relevance, because we find that plaintiff has no confidential relationship with L+G
giving rise to professional duties of loyalty or confidentiality, that L+G represents clients
with interests adverse to plaintiff is irrelevant. Because the judicial notice subject matter
is irrelevant, we deny plaintiff’s request. (Hughes Electronics Corp. v. Citibank
Delaware (2004) 120 Cal. App. 4th 251, 266, fn. 13 [“As a general matter, judicial notice
is not taken of matters irrelevant to the dispositive points on appeal.”].)
                                                  5
showing of a “ ‘manifest and glaring’ ” ethical breach or a concrete and particularized
injury it suffers as a result of L+G’s representation of defendants. (Great Lakes, supra,
186 Cal.App.4th at p. 1357, quoting Colyer v. Smith (1999) 50 F. Supp. 2d 966, 972.)
           2. Plaintiff and La Union Are Not One Entity for Conflict Purposes
       Though plaintiff and L+G have no attorney-client, confidential, or fiduciary
relationship, plaintiff could theoretically invoke La Union’s relationship with L+G to
support a disqualification motion upon a showing that plaintiff and La Union should be
treated as one entity under California conflict of interest rules. Plaintiff cites Morrison
Knudsen Corp. v. Hancock, Rothert & Bunshoft (1999) 69 Cal. App. 4th 223 (Morrison),
which involved the ability of a subsidiary corporation to assert the conflicts of its parent
corporation. (Id. at p. 240.)
       In Morrison, a subsidiary corporation contracted with a water district for
engineering services to relocate a road for a dam project. (Morrison, supra, 69
Cal.App.4th at p. 227.) The law firm Hancock, Rothert & Bunshoft (Hancock) served as
attorneys for the subsidiary’s parent corporation and were later retained by the water
district to investigate the subsidiary’s work on the road relocation project. (Id. at pp. 227-
228.) On appeal from the trial court’s order disqualifying Hancock, the appellate court
discussed “the circumstances in which parent and subsidiary corporations may be treated
as one entity under California conflict of interest rules.” (Id. at p. 240.) Quoting a formal
opinion of the California State Bar Standing Committee on Professional Responsibility
and Conduct, the court stated that a parent and subsidiary should be treated as one if: (1)
“ ‘a corporation is the alter ego of another entity or has sufficient unity of interests,’ ” or
(2) “ ‘the attorney has obtained confidential information directly from the nonclient
subsidiary under circumstances where the subsidiary could reasonably expect that the
attorney had a duty to keep such information confidential ... .’ ” (Morrison, at p. 241,
quoting California State Bar Standing Committee on Professional Responsibility and
Conduct Formal Opinion No. 1989-113.)
                                               6
       To determine whether a sufficient unity of interests exists, attorneys must “
‘evaluate the separateness of the entities involved, whether corporate formalities are
observed, the extent to which each entity has distinct and independent managements and
board[s] of directors, and whether, for legal purposes, one entity could be considered the
alter ego of the other.’ [Citation.]” (Morrison, supra, 69 Cal.App.4th at p. 241.)
Applying that test to the parties before it, the Morrison court noted Hancock received
confidential information during the course of its work for the parent corporation
substantially related to the water district’s claim against the subsidiary corporation.
(Morrison, at p. 245.) Additionally, the parent corporation “control[led] the legal affairs
of the subsidiary,” the parent’s personnel administered the subsidiary’s contract with the
water district, and the water district was aware of the parent corporation’s involvement.
(Id. at p. 246.) Based on that evidence, the court affirmed the trial court’s finding that the
parent and subsidiary had a unity of interests such that they should be treated as one
entity for conflict of interest purposes. (Id. at pp. 247-248.)
       In contrast to the parent and subsidiary in Morrison, plaintiff and La Union have
no unity of interests for purposes of plaintiff’s breach of contract action against
defendants. Plaintiff states that plaintiff and La Union “are labor unions and both have a
direct interest in increasing union membership for agricultural employees.” While
plaintiff and La Union might generally share an interest in increasing union membership,
their interests for purposes of plaintiff’s lawsuit are manifestly adverse. Applying the
unity of interests test, no factor supports treating them as one entity. For example, based
on the complaint it appears plaintiff and La Union have distinct and independent boards
of directors given that La Union consists of non-supervisory employees of the plaintiff.
Additionally, plaintiff presented no evidence that L+G obtained any confidential
information directly from plaintiff. (See Morrison, supra, 69 Cal.App.4th at p. 241
[suggesting parent and subsidiary should be treated as one entity where attorney obtains
confidential information directly from non-client under circumstances where non-client
                                              7
could reasonably suspect attorney had duty to keep information confidential].) Even
assuming that conflict of interest principles applicable to corporations would also apply
to non-corporate entities, no evidence supports treating plaintiff and La Union as one
entity for conflict of interest purposes.
   C. DISCLOSURE OF INFORMATION BY CURRENT AND FORMER EMPLOYEES
       Plaintiff argues that “L+G’s representation of current and former UFW employee
organizers exposes the firm to a wealth of information regarding [plaintiff’s] internal
processes and procedures.” Though never expressly stated, plaintiff’s concern appears to
be that L+G will use this information in its representation of clients (i.e., agricultural
employers) in matters adverse to plaintiff.
       Neal v. Health Net, Inc. (2002) 100 Cal. App. 4th 831 (Neal), addressed concerns of
an employer about disclosure of confidential information by a former employee. Plaintiff
Khybrette Neal retained attorney Michael S. Traylor and sued her former employer,
Health Net, Inc., for wrongful discharge based on gender and racial discrimination. A
legal secretary for Health Net named Cynthia Brockett was terminated for accessing
Health Net’s confidential attorney-client information related to Neal’s case. Brockett
then retained Traylor to file her own discrimination lawsuit against Health Net, leading
Health Net to move to disqualify Traylor from Neal’s case. (Id. at p. 834.) The court of
appeal reversed the trial court’s order disqualifying Traylor. (Id. at p. 850.)
       In reversing the trial court, the Neal court distinguished the facts of that case from
ethical rules regarding successive representation of adverse parties in the same case by an
attorney. (Neal, supra, 100 Cal.App.4th at pp. 840-841.) Unlike cases with successive
representation of adverse parties by an attorney, where a “presumption of possession of
confidential information” applies and disqualification is automatic, the court found the
present case “entirely different” because Brockett was not an attorney or even affiliated
with Traylor as a legal secretary. (Id. at p. 841.) Instead, the court found Brockett was
merely “a client” of Traylor and noted that the “Supreme Court has never held that the
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presumption of possession of confidential information and the automatic disqualification
rule applies when a nonlawyer client who may have access to privileged matters retains
an attorney.” (Ibid., original italics.) Thus, automatic disqualification was unwarranted.
       Turning to whether disqualification was nonetheless appropriate, even if not
mandatory, the Neal court noted that cases “discuss[ing] the issue of whether an attorney
should be disqualified after being exposed to an adverse party’s confidential information
... have consistently concluded that mere exposure to confidential information of the
opposing party does not require disqualification.” (Neal, supra, 100 Cal.App.4th at p.
841.) The court then discussed several ways in which Traylor’s disqualification was an
abuse of discretion. Health Net presented no evidence that any information related to
Neal’s case was actually disclosed to Traylor by Brockett. Even if Brockett had
disclosed confidential information to Traylor, the court found “no applicable legal
standard that supports disqualification ... as a sanction” for that disclosure. (Id. at p. 843.)
In that same vein, the court reasoned that disclosing confidential information to one’s
own counsel in one’s own lawsuit is not improper. “[B]arring discussions of an
adversary’s confidences known to the client ... would defeat the purpose of
confidentiality, which is to promote full and open discussions between attorney and
client.” (Id. at pp. 843-844.) Importantly, the court pointed out that “disqualification is
also an ineffective remedy because it would not prevent the party from giving new
counsel the information, which would leave the adversary in the same position as
before.” (Id. at p. 844.) Finally, the court explained that “in cases such as the one at
bench, where an adversarial relationship develops, the rights of the employer to avoid
unwarranted public disclosure of its confidences must be balanced against the employee’s
right to maintain his or her lawsuit.” (Ibid.) Rather than the “drastic” measure of
disqualification, an employer can protect its confidences from unwarranted disclosure by
“measures such as: protective orders, limiting the admission of evidence; in camera
proceedings; the use of sealed records; payment of attorney fees and costs; and
                                               9
disciplinary sanctions through the State Bar of California in appropriate circumstances.”
(Ibid.)
          Applying the legal principles summarized in Neal here, plaintiff does not allege
any of the defendants are or were formerly attorneys representing plaintiff. Instead, like
Ms. Brockett in Neal, defendants are merely clients of L+G. Given the adverse posture
between plaintiff and defendants in the present lawsuit, and in light of defendants’
apparent satisfaction with representation by L+G, the trial court did not abuse its
discretion by denying plaintiff’s motion.
                                    III.   DISPOSITION
          The order denying plaintiff’s motion to disqualify L+G is affirmed.

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                                  ____________________________________
                                  Grover, J.

WE CONCUR:

____________________________
Bamattre-Manoukian, Acting P.J.

____________________________
Márquez, J.