Court Opinion

ID: 2746307
Source: CourtListenerOpinion
Date Created: 2014-10-29 13:05:59.630531+00
Date Added: 2024-06-11T10:13:51.730573
License: Public Domain

THIRD DIVISION
                                 BARNES, P. J.,
                             BOGGS and BRANCH, JJ.

                     NOTICE: Motions for reconsideration must be
                     physically received in our clerk’s office within ten
                     days of the date of decision to be deemed timely filed.
                                http://www.gaappeals.us/rules/

                                                                     October 22, 2014

In the Court of Appeals of Georgia
 A14A0925. FEIN et al. v. CHENAULT et al.                                      BA-046

       BARNES, Presiding Judge.

       Florida attorney Frederick J. Fein and his client Continental Tire The Americas,

LLC (Continental), filed a direct appeal of the trial court’s order in this personal

injury case finding that Fein violated the Georgia Rules of Professional Conduct but

declining to revoke his pro hac vice status. Instead, the court restricted Fein’s

advocacy by designating local counsel as lead counsel for defendant Continental and

directing Fein not to prepare or file pleadings, contact the court or its staff, or present

argument or evidence at any future court proceeding. The court noted that Fein would

be permitted to attend all future proceedings, confer with his client and local counsel,

and sit at counsel table during court. Because this court lacks jurisdiction to consider
this issue on direct appeal while the case remains pending in the trial court, we must

dismiss the appeal.

      The underlying case arose when Marlos Chenault and his wife filed suit against

multiple defendants after Chenault was involved in a car wreck, allegedly caused by

a defective tire, that resulted in his paralysis. The Chenaults brought product liability

and negligence claims against Continental and General Motors Corporation (GM).

GM is not involved in the issue before this court now. Discovery disputes regarding

the disclosure of certain rubber compound formulas and other information

Continental Tire deemed to be trade secrets led to a telephone conference with the

trial court, which resulted in the court ordering Continental on May 23, 2013, to

disclose certain information pursuant to a protective order by June 11, 2013.

      On May 31, 2013, Continental filed an “Emergency Motion for

Reconsideration or, in the Alternative, Request for a Certificate of Immediate Review

of the Court’s Order of May 23, 2013,” arguing that the telephonic hearing was

inadequate to provide the trial court with the necessary case law and evidence, that

the information was “highly proprietary trade secrets that are not subject to

disclosure,” that its production would cause irreparable harm, and that Chenault had

not shown sufficient need for the information. It argued that “courts across the county

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have repeatedly found that tire companies’ rubber compound formulas . . . are trade

secrets whose secrecy and value in being maintained as secrets justify excluding them

from the discovery process,” even with a protective order. Continental attached an

affidavit from its director of product analysis, who averred that the company’s rubber

compound formulas are so highly protected they “are not disclosed even pursuant to

a protective order.”

      Chenault responded on May 31, 2013, and argued that the information sought

was not a trade secret and was crucial to his claim. He further argued that the cases

cited by Continental for the proposition that courts have refused to allow discovery

of the information sought actually dealt with different information, and that “a

number of other courts have in fact ordered both the disclosure of halobutyl content

in tires, as well as the full formulas.”1 Chenault attached orders from Missouri,

Florida, and New York courts directing Cooper Tire Company to disclose information

regarding the content or existence of halobutyl in the inner liner of the subject tires,

and an order from a Montana court directing Continental to disclose tire compound

formulas.

      1
       Halogenated butyl (halobutyl) rubber is an expensive synthetic rubber
compound used to make a tire’s inner liner less permeable to air. Chenault sought to
discover the percentage of halobutyl in the inner liner of the tire that blew on his car.

                                           3
       The ten-day window for issuing a certificate of immediate review passed

without a ruling from the trial court. On June 4, 2013, Continental filed an emergency

motion to stay that portion of the trial court’s May 23 order directing it to produce

certain information by June 11, 2013. Chenault opposed the stay, noting in a brief

filed on June 10, 2013, that Continental was citing to a legal standard inapplicable in

Georgia, which required movants to show that the disclosure of confidential

information was “necessary.” Chenault also pointed out that while Fein represented

that a court had never required his clients to produce rubber compound information,

he was lead counsel in a Florida case and a DeKalb County, Georgia, case, in which

the tire manufacturer he represented was ordered to disclose that information.

       On June 11, 2013, the trial court denied Continental’s motion to stay and for

reconsideration, reminding the parties of the existing protective order and giving

Continental until June 14, 2013, to produce the documents and information

previously ordered. On June 13, 2014, Continental requested a certificate of

immediate review of the court’s June 11 order, which the court denied later that same

day.

       On June 14, 2013, Continental filed a notice of appeal from the court’s

discovery orders of May 23, 2013 and June 11, 2013, and also filed an application for

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interlocutory appeal with this court. This court dismissed the interlocutory appeal on

July 11, 2013, and dismissed the direct appeal on August 20, 2013, finding in both

cases that the discovery issue was neither an exceptional one reviewable absent a

certificate of immediate review, nor subject to the collateral source exception to the

final judgment rule.

      Meanwhile, on June 22, 2013, the trial court sua sponte issued a rule nisi,

placing the parties “on notice that it is considering revoking the pro hac vice status

of Frederick J. Fein, Esq., based upon material false statements made to the Court

regarding legal authority and factual matters during his representation[,] which

misstatements may be detrimental to the prompt, fair and efficient administration of

justice in this case.” It ordered Fein and all other counsel for Continental to appear

on September 4, 2013, for a hearing on the issue.

      On June 26, 2013, Continental moved to vacate the rule nisi, arguing that Fein

did not know what false statement the court referred to, that the court appeared to

have already determined his culpability, and that the court had entered the order

without giving him a chance to refute it. All previous pleadings had been signed only

by local counsel, but the motion to vacate was the first one that also included Fein’s

signature as counsel for Continental. All subsequent pleadings included Fein’s

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signature until the trial court’s October 2013 order at issue here. The trial court

denied the motion to vacate the rule nisi order on July 26, 2013.

      Both parties filed motions on July 29, 2013, with Chenault moving to compel

Continental to provide the discovery the trial court had previously ordered it to

produce and Continental filing a motion to recuse the trial court. On July 30, 2013,

Continental filed a Rule 5.2 certificate of service of discovery of supplemental

answers and objections to Chenault’s interrogatories and requests for production of

documents.

      On July 31, 2013, the trial court issued an order denying Continental’s motion

to recuse, finding the motion timely but lacking a basis as a matter of law. On August

1, 2013, the court ordered Continental to respond to Chenault’s motion to compel by

August 16, 2013, and the next day Chenault filed a motion seeking sanctions for

discovery abuse. On August 6, 2013, Continental requested a certificate of immediate

review of the court’s order denying its motion to recuse.

      On August 8, 2013, the trial issued an amended rule nisi, directing that

      defense counsel, including pro hac counsel, should be prepared to
      address the question of whether or not pro hac counsel violated Georgia
      Rule of Professional Conduct 3.3 during a telephone conference with the
      Court regarding Plaintiff’s Interrogatories and Request for Production

                                          6
      of Documents in May of 2013. Specifically, the Court is concerned that
      pro hac counsel made false statements regarding the law to the tribunal,
      failed to disclose legal authority contrary to his position which was
      known to him, and failed to disclose material facts to the tribunal which
      were in direct contradiction of his statements made on personal
      knowledge regarding the production of evidence in this case. If proven,
      these misstatements may be detrimental to the prompt, fair and efficient
      administration of justice in this case and may be grounds for a
      revocation of Mr. Fein’s pro hac status pursuant to Rule 4.4 (d) (4) and
      4.4 (f) (1) (b).

(Emphasis supplied.)

      On August 14, 2013, Fein filed a renewed Motion to Vacate Rule Nisi of June

22, 2013 (the first rule nisi), arguing that, although the trial court added qualifying

language in its amended rule nisi, it had not vacated its initial rule nisi, which had

already been cited by opposing counsel in other cases as proof that Fein had been

found to have exhibited a “pattern of deception” in representing his client. Fein also

objected to and moved “to clarify” the amended rule nisi, contending that he still did

not know what he failed to disclose or misrepresented to the court.

      Two days later, Continental filed an opposition to Chenault’s motion to compel

and for attorney fees, arguing that it had “bent over backwards to produce hordes of

information about the tire” at issue in this case. Continental included affidavits from

                                          7
company engineers stating that Chenault’s discovery requests were too broad to

comply with and that because this particular unique tire had been developed with GM

for this particular vehicle, information about other tires was irrelevant.

      Continental also responded to Chenault’s motion for sanctions on August 14,

2013. Its brief began, “According to Plaintiffs, no good deed should go unpunished,”

and asserted that the company had gone above and beyond its required duty to locate

certain information, the late production of which had resulted in Chenault’s motion

for sanctions. Continental accused Chenault of trying to turn the case into one about

a “discovery tort,” rather than a “ 7[-]year-old, used, worn-out tire, which never

should have been in service on the day of this accident. . . .” Attached to the motion

were affidavits from Fein’s local counsel attesting to the parties’ agreement about

Continental’s deadline in supplementing its discovery responses and from

Continental’s senior counsel regarding the company’s efforts to locate the

information sought.

      An attorney made an entry of appearance on Fein’s behalf, and on August 28,

2013, Fein filed a supplement to his objection to the trial court’s amended rule nisi

and another motion to clarify it, noting that in a discussion with the court’s staff

attorney, Fein’s counsel had been referred to a specific page in one of Chenault’s

                                          8
pleadings. In that pleading, Chenault argued that Fein said he had never been

required to produce rubber compound information and submitted orders from other

courts. Fein argued in his supplemental objection that what he actually said during

the telephone conference was that “he has never produced such information in any

case he has handled, a statement which remains true to this day,” because the orders

directing Continental to produce that information were later vacated. Therefore,

Continental did not produce the information, he concluded, and his statement to the

trial court in this case was accurate. Fein submitted an affidavit attesting to those

facts, and attached the court orders vacating the previous orders requiring Continental

to produce the disputed information.

      In reply, on September 3, 2014, Chenault argued that Fein’s response was

“disingenuous.” First, he contended, whether or not Fein used the word “required”

during the telephone conference was not controlling, because his argument left the

court with the “clear impression” that a order directing Continental to produce the

halobutyl information would be “completely ‘out of left field’” and that “ordering its

production would be totally unheard of.” Chenault quoted from a hearing transcript

in a DeKalb County case in which Fein similarly argued he had never been required

to produce this information, and that transcript is included in this record on appeal.

                                          9
Chenault further argued that Fein’s brief was misleading because the orders to

produce were vacated solely as a condition of settlement.

      After the September 4, 2013, hearing, the court found that Fein had

intentionally made statements to the court that were “deliberately calculated to cause

the Court and opposing counsel to infer a fact that was not true so as to gain

advantage for his client.” The trial court found that these statements violated the

Georgia Rules of Professional Conduct, but declined to revoke Fein’s pro hac vice

status. Instead, the court restricted Fein’s advocacy by designating local counsel as

lead counsel for defendant Continental. The trial court also directed that Fein was not

allowed to prepare or file pleadings, contact the court or its staff, or present argument

or evidence at any future court proceeding, although he would be permitted to attend

all future proceedings, confer with his client and local counsel, and sit at counsel

table during court.

      Fein first asked the trial court to issue a certificate of immediate review of its

order, which the court denied. Fein nevertheless filed an application for interlocutory

appeal, which this court dismissed on November 26, 2013, Case Number A14I0051.

We held that an appellate court generally will not review a trial court’s exercise of its

discretion to grant or deny a certificate of immediate review, citing Scruggs v.

                                           10
Georgia Dept. of Human Resources, 261 Ga. 587, 588 (1) (408 SE2d 103) (1991); B

& D Fabricators v. D. H. Blair Investment Banking Corp., 220 Ga. App. 373, 376 (3)

(469 SE2d 683) (1996). We further held that this is not one of those extraordinary

cases described in Waldrip v. Head, 272 Ga. 572 (532 SE2d 380) (2000), that qualify

for an exception to the certificate requirement because the trial court’s actions would

preclude appellate review of a substantive issue. We thus dismissed the application

due to Continental’s failure to comply with the interlocutory procedures of OCGA §

5-6-34 (b).

      Fein also filed a direct appeal of the trial court’s order, and contends that the

trial court’s order infringes on Continental’s fundamental right to counsel of its

choosing and is an “unwarranted disqualification” based on a misrepresentation that

never occurred. After this appeal was docketed, Chenault moved to dismiss it on

jurisdictional grounds, arguing that the trial court’s order regarding Fein’s status as

pro hac vice counsel is neither final nor otherwise appealable, citing Board of Regents

of the Univ. System of Ga. v. Canas, 295 Ga. App. 505 (672 SE2d 471) (2009). In

Canas, we held that

      A necessary prerequisite for a direct appeal is that the judgment or order
      appealed from be final or otherwise appealable. A judgment is directly

                                          11
      appealable as a final judgment where the case is no longer pending in
      the court below, except as provided in Code Section 5-6-35 (concerning
      cases requiring an application for appeal). . . . Generally, where an
      appellant fails to comply with the interlocutory appeal procedures set
      forth in OCGA § 5-6-34 (b) and an interlocutory ruling is not otherwise
      appealable, this Court lacks jurisdiction over a direct appeal filed from
      an interlocutory ruling and must dismiss it.

(Citation and punctuation omitted.) Id. at 506 (1).

      Besides final judgments, OCGA § 5-6-34 allows “the direct appeal of

judgments or orders that may have an irreparable effect on the rights of parties, such

as rulings in contempt, injunction, and mandamus actions.” In re Paul, 270 Ga. 680,

682 (513 SE2d 219) (1999). See OCGA § 5-6-34 (a) (2)-(12). Additionally, parties

may directly appeal a “collateral order,” even if the case remains pending in the trial

court, if “the issue is substantially separate from the basic issues presented in the

complaint, an important right may be lost if review had to await final judgment, and

nothing further in the underlying action can affect the issue on appeal.” In re Paul,

270 Ga. at 682-683.

      Fein stated in his response to Chenault’s motion to dismiss that “Appellants do

not contend that the Disqualification Order is a collateral order and will not address

Appellees’ arguments regarding the collateral order doctrine.” Instead, he argues, he

                                          12
has a right to direct appeal based on Stevens v. Thomas, 257 Ga. 645 (361 SE2d 800)

(1987). The Georgia Supreme Court in Stevens found untimely the appeal of an order

disqualifying an attorney from representing two plaintiffs in a class action suit

because of disciplinary rules violations, reasoning that the disqualification was a

sanction that took place immediately, and also noting that the court had subsequently

affirmed a contempt citation related to the sanction in Brown v. Thomas, 257 Ga. 68

(354 SE2d 830) (1987). Stevens, 257 Ga. at 647 (1). The court then remanded the case

for the trial court to determine whether an attorney fee award was imposed “as a

penalty for contempt or as a penalty for violations of the disciplinary rules.” Id.2

      In contrast, Chenault argues that the disqualification order is not directly

appealable per Cherry v. Coast House, Ltd., 257 Ga. 403 (359 SE2d 904) (1987), a

case from the same term as Stevens. In Cherry, the Supreme Court held that an order

disqualifying an attorney from representing a client would ordinarily require an

application for interlocutory appeal pursuant to OCGA § 5-6-34 (b). Cherry, 257 Ga.

      2
        The only two grounds on which the Supreme Court in Stevens could have
relied in holding that the disqualification order was immediately appealable were
either: (1) as an exception to the final order requirement, which are listed in OCGA
§ 5-6-34 (a), none of which are applicable here, or (2) as a collateral order reviewable
before the trial court entered a final judgment or order in the case. For purposes of
this analysis, however, whether Fein is actually arguing the collateral order doctrine
or not is irrelevant.

                                          13
at 405 (2). In that case, however, because summary judgment grants were before the

court on direct appeal, the Supreme Court also considered the disqualification orders.

Id.

      Fein argues that the Supreme Court’s pronouncement in Stevens controls this

appeal, being the latest on the issue of whether an order disqualifying a lawyer is

directly appealable before a final order or judgment is entered in the trial court. This

court attempted to reconcile the conflicting cases in Settendown Public Utility v.

Waterscape Utility, 324 Ga. App. 652, 654 (751 SE2d 463) (2013), writ of cert. and

motion for reconsideration denied (Supreme Court Number S14C0436, March 3,

2014, March 28, 2014) and Lassiter Properties v. Davidson Mineral Properties, 230

Ga. App. 216, 217-218 (495 SE2d 663) (1998). In addition to Settendown and

Lassiter, this court has held in other cases that attorney disqualification orders must

be brought by application for interlocutory appeal after the issuance of a certificate

of immediate review and are not directly appealable. See Amado v. City of Atlanta,

228 Ga. App. 791 (492 SE2d 761) (1997); Ewing Holding Corp. v. Egan-Stanley

Investments, 154 Ga. App. 493, 496 (1) (268 SE2d 733) (1980).

      In considering whether this court has jurisdiction to address the direct appeal

of the trial court’s order regarding Fein’s pro hac vice status, however, we need not

                                          14
determine whether an order disqualifying an attorney from representing a client is

directly appealable or not under Stevens, because Fein was not disqualified. Rather,

the trial court decided not to revoke Fein’s pro hac admission to practice in this case,

finding that to do so “would be too harsh of a remedy for the harm incurred.” Instead,

the trial court designated the two local counsel as lead counsel and directed that only

those attorneys “prepare and file pleadings, contact the Court, or present evidence or

argument at any future motions, hearings, or trials.” The court further found that Fein

would be permitted to attend any proceedings, confer with local counsel and his client

at will, and sit at counsel table, but would not be allowed to prepare or file any

documents, deal directly with the court of its staff, “or otherwise act as lead counsel.”

      Finally, we note that important public policy considerations compel against

allowing a direct appeal in this context. In holding that an attorney’s disqualification

was not subject to the collateral order docrine exception to the requirement of a final

judgment or order under the Federal Rules of Civil Procedure, the United States

Supreme Court observed,

      We also decline to view the disqualified attorney’s personal desire for
      vindication as an independent ground for interlocutory appeal. An
      attorney who is disqualified for misconduct may well have a personal
      interest in pursuing an immediate appeal, an interest which need not

                                           15
      coincide with the interests of the client. As a matter of professional
      ethics, however, the decision to appeal should turn entirely on the
      client’s interest.

Richardson-Merrell v. Koller, 472 U.S. 424, 434-435 (III) (A) (105 SCt 2757; 86

LE2d 340) (1985). The Supreme Court further held that “orders disqualifying counsel

in civil cases are not completely separate from the merits of the action,” because

“[a]ppellate review of orders disqualifying counsel for misconduct may be entwined

with the merits of the litigation as well.” (Citation and punctuation omitted.) Id. at

439 (III) (B). While acknowledging that an order disqualifying counsel may impose

significant hardship on litigants and “tempt courts of appeals to assert jurisdiction,”

the Supreme Court quoted the following from a Third Circuit case addressing the rule

that only final judgments are reviewable in the federal courts:

      It would seem to us to be a disservice to the Court, to litigants in general
      and to the idea of speedy justice if we were to succumb to enticing
      suggestions to abandon the deeply-held distaste for piecemeal litigation
      in every instance of temptation. Moreover, to find appealability in those
      close cases where the merits of the dispute may attract the deep interest
      of the court would lead, eventually, to a lack of principled adjudication
      or perhaps the ultimate devitalization of the finality rule as enacted by
      [the legislature].

                                          16
(Citations and punctuation omitted.) Id. at 440 (IV).

      Chenault’s motion to dismiss is hereby GRANTED. His motions for sanctions

and to supplement the record are DENIED.

      Appeal dismissed. Boggs and Branch, JJ., concur.

                                         17