Appeal from two orders of the United States District Court for the Southern District of New York, Robert L. Carter, Judge, the first granting class action status to action alleging principally a violation of Section 2 of the Sherman Act; the second denying a motion to disqualify the City of New York's privately-retained counsel. A petition for mandamus was also filed by General Motors to gain appellate review of these two orders. Appeal from the order granting class action status dismissed; the order denying disqualification reversed. Petition for mandamus denied.
Kaufman, Chief Judge, Mansfield and Mulligan, Circuit Judges. Mansfield, Circuit Judge (concurring).
Suits involving large damage claims inevitably spark intensive pretrial skirmishing, as the litigants bombard each other and the district court with a variety of motions. In this case, brought by the City of New York [City], which alone has a $12,000,000 claim, as a class action alleging that General Motors Corporation [GM] has violated the antitrust laws principally by monopolizing or attempting to monopolize the nationwide market for city buses, we face appeals by GM from interlocutory orders deciding two bitterly contested pretrial, although unrelated, motions. The first is the City's successful motion to permit the suit to proceed as a class action; the second, GM's unsuccessful motion to have the City's privately-retained counsel, George D. Reycraft, disqualified for breach of the ethical precepts embodied in Canon 9 of the Code of Professional Responsibility.*fn1 After carefully applying the Cohen*fn2 collateral order doctrine to separate the appealable from the nonappealable order, we dismiss the appeal from the court's order determining that this action may proceed as a class action because in the context of this case that order is not appealable. With respect to the motion to disqualify counsel, however, we conclude, without intending to suggest any actual impropriety on the part of Reycraft, that his disqualification is required to "avoid even the appearance of professsional impropriety."*fn3 Accordingly, the court's order denying disqualification of Reycraft is reversed.
The facts necessary to an understanding of our disposition of these appeals have been gleaned in the main, from the complaint and from the affidavits filed by the parties in support of and in opposition to the respective motions at issue. They are, thankfully, rather straight-forward and, in all material respects, undisputed.
On October 4, 1972, the City filed a complaint alleging that GM had violated Section 2 of the Sherman Act*fn4 by attempting to monopolize and monopolizing "trade and commerce in the manufacture and sale of city buses." The complaint contained, as a second cause of action, the allegation that GM had breached Section 7 of the Clayton Act*fn5 by acquiring, in 1925, a controlling interest in Yellow Truck & Coach Manufacturing Co. [Yellow Coach] -- an acquisition which purportedly "threatens substantially to lessen competition and to tend to create a monopoly in the manufacture and sale of buses within the United States . . . ." The action, furthermore, was commenced on behalf of a class consisting of "all non-federal governmental units and instrumentalities in the United States which have purchased or have contributed to the purchase of city buses or city bus parts . . . ." The relief sought was, inter alia, for appropriate divestiture, treble damages, cost and attorneys' fees.
According to Reycraft's affidavit, filed in opposition to the disqualification motion, he was asked by the Office of the Corporation Counsel, sometime in July 1972, to assist in the preparation of the complaint. When approached by the Corporation Counsel, then J. Lee Rankin, Reycraft responded by informing Rankin of his prior and substantial involvement in an action brought by the United States against GM, under Section 2 of the Sherman Act, based on GM's alleged monopolization of a nationwide market for the manufacture and sale of city and intercity buses. United States v. General Motors (No. 15816, E.D. Mich. 1956) [1956 Bus case].
In his affidavit, Reycraft described his participation in the 1956 Bus case, and his work for the Antitrust Division of the Department of Justice in these words:
I was employed as an attorney for the Antitrust Division of the Department of Justice from the end of December, 1952 through the end of December, 1962. From sometime during the middle of 1954 through the end of 1962 I was employed in the Washington Office of the Antitrust Division. My initial assignment in the Washington Office of the Antitrust Division in 1954 was as a trial attorney in the General Litigation Section.
One of my first assignments as a member of the General Litigation Section was to work on an investigation of alleged monopolization by General Motors of the city and intercity bus business. The chief counsel in that matter from at least 1954 until the case was settled by Consent Decree in 1965 was Walter D. Murphy. At no time was I in active charge of the case. That investigation culminated in the Complaint filed on July 6, 1956 which I signed and in the preparation of which I participated substantially.
In 1958, I became Chief of the Special Trial Section of the Antitrust Division and no longer had any direct or indirect involvement with the 1956 Bus case. Subsequently in 1961 I became Chief of Section Operations of the Antitrust Division and had technical responsibility for all matters within the Washington Office of the Antitrust Division, including the 1956 Bus case. I have no recollection of any active participation on my part in the 1956 Bus case from 1958 through the time I departed from the Antitrust Division in December of 1962. The case was in the charge of Walter D. Murphy from its inception and he continued in charge until the Consent Decree was entered on December 31, 1965. (emphasis added)*fn6
In light of his substantial involvement as an employee of the Department of Justice in a matter which, at the very least, was similar to the dispute for which his retention was sought, Reycraft initially consulted his partners in the firm of Cadwalader, Wickersham & Taft and, subsequently, requested the advice of the Antitrust Division on the applicability of the Federal conflict of interest statute.*fn7 That statute, we note, is penal in nature and its prohibitory rules, only two in number, must therefore be specifically defined and strictly construed. With that in mind, the Justice Department had little difficulty in concluding that the statute placed no bar on Reycraft's employment by the City. Its response to Reycraft states, in pertinent part:
It is clear that section 207(b) [which applies for only one year after separation from government employ] has no bearing on your case. As for section 207(a) [which applies only where the United States is a party or has a direct and substantial interest in the matter], although it appears that you participated personally and substantially in the case brought by the United States against General Motors, the Antitrust Division advises us that the United States will not be a party to or have a direct and substantial interest in the private antitrust suit by the City of New York against General Motors. Therefore, section 207(a) has no application.
Accordingly, with Cadwalader's approval and the absence of any barrier posed by federal law, Reycraft agreed to represent the City on a contingent fee basis, a not infrequent arrangement in actions where recovery is at the same time uncertain but potentially great.
On February 22, 1973, the City moved before Judge Carter for a determination that its suit could proceed as a class action pursuant to Fed. R. Civ. P. 23(a) and 23(b) (3). GM responded by opposing the class determination and, in turn, moved for the disqualification of Reycraft. Argument on both motions was subsequently heard by the court.
The City represented to Judge Carter that the class for which it sought representation would consist of 200-300 readily identifiable non-federal governmental units. It submitted a preliminary list of 177 entities identified as of the date of argument.*fn8 The City also informed the judge that it would bear the cost of notifying all class members. The argument in the district court on the disqualification motion, although quite thorough, as indeed it was in this Court, added no material facts other than those we have already related.
In August 1973, Judge Carter entered his order, and filed an accompanying memorandum opinion,*fn9 granting the City's motion for class action status and denying GM's motion to disqualify Reycraft. Rejecting GM's twofold contention that the requirements of Rule 23(b) (3)*fn10 had not been met, the district judge concluded: (1) "that the common underlying issue of liability pursuant to an unlawful, nationwide monopoly predominates over any questions as to the varying nature or amount of damages;" and (2) that the class action mechanism was the superior method for resolving this controversy because "it is . . . inconceivable that other governmental units will not pursue such claims [of monopolization] in the event that the class action motion is denied and the suit brought by the City of New York is, or appears likely to be, successful."
Turning to the disqualification motion, the district court recognized that DR9-101(B) requires*fn11 Reycraft's disqualification, in order to avoid "even the appearance of impropriety," if his participation in this action would constitute "private employment in a matter in which he had substantial responsibility while he was a public employee." Since it was virtually conceded that Reycraft had "substantial responsibility" over the 1956 Bus case, the only questions which remained were whether his engagement to represent the City was "private employment," and whether the City's antitrust action was, for purposes of DR9-101(B), the same "matter" as the 1956 Bus case. Judge Carter answered both questions in the negative.
We need not tarry over the question of our jurisdiction to review the district court's order denying disqualification, for our recent en banc decision in Silver Chrysler Plymouth, Inc. v. Chrysler Motors Corp., 496 F.2d 800, slip op. at 3011 (2d Cir. 1974) (en banc) concluded that such an interlocutory order falls within the narrow confines of permissible appeals under the collateral order doctrine. Hence, it is appealable as a "final" order pursuant to 28 U.S.C. § 1291. See e.g., Cohen v. Beneficial Industrial Loan Corp., 337 U.S. 541, 93 L. Ed. 1528, 69 S. Ct. 1221 (1949).
It is equally plain, however, in accordance with the teachings of an even more recent decision of this Court, Kohn v. Royall, Koegel & Wells, 496 F.2d 1094, slip op. at 3243 (2d Cir. 1974), that interlocutory orders granting class standing are not uniformly deserving of such exceptional treatment. In Kohn, we sought to provide some guidposts to aid in discerning requisite finality.*fn12 Our product, distilled from previous decisions of this Court, was a three-pronged test for appealability of an order granting class standing:
(1) whether the class action determination is "fundamental to the further conduct of the case;"
(2) whether review of that order is "separable from the merits;"
(3) whether that order will cause "irreparable harm to the defendant in terms of time and money spent in defending a huge class action . . ."
Kohn v. Royall, Koegel & Wells, supra, 496 F.2d 1094, slip op. at 3521. See also Herbst v. International Telephone and Telegraph, 495 F.2d 1308, slip op. at 2621, 2628 (2d Cir. 1974). Here, as in Kohn, none of these requirements has been met.
The fundamental-to-the-further-conduct requirement, we concluded in Kohn, is satisfied where "the action's viability turns on the class action determination." Kohn v. Royall, Koegel & Wells, supra, 496 F.2d 1094, slip op. at 3252. Although a narrow definition, we believe that our interpretation of the "fundamentality" requirement is not only consistent with the Supreme Court's application of that concept*fn13 but necessary, as well, lest this exception, in conjunction with the collateral order doctrine, "swallow the salutary 'final judgment' rule." Weight Watchers of Phila. v. Weight Watchers Int., 455 F.2d 770, 773 (2d Cir. 1972). Since it is undisputed that the City with its $12,000,000 claim would continue this action were class standing denied, it is quite clear that the first element of the appealability equation is lacking in this case.
Nor is the second prong of the appealability test fulfilled for, as in Kohn, review of the court's class action determination would take us far into the merits of the City's antitrust claim that GM has monopolized or attempted to monopolize a nationwide market in the manufacture and sale of city buses. GM, for example, vigorously disputes the district court's conclusion that proof of monopolization or attempted monopolization will present common questions of law or fact that will predominate over individual proof of damages. To buttress this contention, GM argues that "proof relating to market, competion, economic power, [and] relevant economic behavior . . . ." will vary for each purported member of the class. See Brief for Appellant at 27-28. A mere recitation of these factors demonstrates their obvious relationship to the very issues critical to the success of the City's underlying antitrust claim. Thus, we are asked at this preliminary stage in the litigation to undertake the difficult though eventually unavoidable task of product and geographic market definition, simply to determine whether evidence submitted in the course of this definitional process will be common or individual in nature. The redundancy of effort and consequent waste of judicial resources must be apparent; accordingly, we shall not belabor the point.
Finally, we do not find in this case the spectre of irreparable harm, either in terms of costs of defending the action or in its judicial management, as we did in the huge class actions before us in Eisen v. Carlisle & Jacquelin, 479 F.2d 1005 (2d Cir. 1973), aff'd, vacated and remanded, 417 U.S. 156, 94 S. Ct. 2140, 40 L. Ed. 2d 732 (1974) (estimated identifiable class of 2,250,000) and Herbst v. International Telephone and Telegraph Corp., supra (estimated identifiable class of 16,000). Although the instant case is a Rule 23(b) (3) class action, the class here, tentatively estimated at 177, does not remotely approach the thousands or, indeed, millions encountered in Eisen and Herbst. Moreover, the procedural costs unique to the class action mechanism -- essentially the cost of notice -- will be assumed by the plaintiff City, as, indeed, they now must be under Eisen. And, since the City's claim of nationwide monopolization will, even absent class action status, sustain broad discovery and evidentiary admissibility at trial as to alleged national predatory practices, the incremental cost of defending this action as a class action should not be significant. See Kohn v. Royall, Koegel & Wells, supra, 496 F.2d 1094, slip op. at 3255-56.
Despite our conclusion that nonappealability is mandated by Kohn, GM urged at argument that the Supreme Court's recent decision in Eisen v. Carlisle & Jacquelin, supra, might well have broadened the parameters governing the appealability of orders granting class action status. To the contrary, we find in Eisen a reaffirmation of the exceptional circumstances required to justify departure from the "final judgment" rule -- circumstances not present in this case.
The Supreme Court, in Eisen, once again examined the policy behind the Cohen collateral order doctrine and found it applicable to the single question it was deciding -- the propriety of the notice procedure adopted by the district court.*fn14 This, we might add, included consideration of both the method of notice and the cost of notice. The Court emphasized that the notice ruling by the district court was not "tentative, informal or imcomplete," citing Cohen, 337 U.S. at 546, nor did review of the order's validity require consideration with the merits of the underlying cause of action, see Cohen v. Beneficial Industrial Loan Corp., supra, 337 U.S. at 546-47. Accordingly, giving the requirement of finality a "practical rather than a technical construction," id. at 546, the Court, in Eisen, struck the balance between " 'the inconvenience and costs of piecemeal review on the one hand and the danger of denying justice by delay on the other,' Dickinson v. Petroleum Conversion Corp., 338 U.S. 507, 511, 94 L. Ed. 299, 70 S. Ct. 322 (1950) (footnote omitted),"*fn15 by permitting an immediate appeal from "the District Court's resolution of the class action notice problems in this case. . . ." Eisen v. Carlisle & Jacquelin, supra, 501 F.2d 639, 42 U.S.L.W. at 4809 (1974).
Applying each of the considerations discussed in Eisen to the facts here, it is clear to us that the district court's order granting class action status in this case is not now appealable. Unlike the rulings in Cohen and Eisen, Judge Carter's determination to permit the City's action to proceed as a class action is very much "tentative," subject always to reconsideration as the cause of action unfolds.*fn16 We noted in Wolf v. Green Corp., 406 F.2d 291, 299 (2d Cir. 1968), cert. denied, 395 U.S. 977, 23 L. Ed. 2d 766, 89 S. Ct. 2131 (1969):
Rule 23 now emphasizes the flexibility which a trial court exercises in the management of the action . . . . It is this flexibility which indeed enables us to view liberally claims which assert a right to a class action . . . at the early stages of the litigation . . . .
Thus, if the concern voiced by GM at argument respecting the potentially explosive class size*fn17 or the possible confusion bred by the disparate proof required for a proper market analysis should become a reality, we are confident that the district court will act appropriately, limiting or even striking the class if necessary.
We consider it imperative, furthermore, to recognize the sharp distinction between the bases for attacking the class action determination in this case as contrasted with Eisen. In Eisen, as noted, the Supreme Court focused narrowly on the unprecedented and extraordinary notice procedure authorized by the district court. In this case, however, there is nothing unique about the notice procedure approved by the court below -- individualized notice is to be given to all identifiable class members, and at the City's expense. Rather, GM's attack on the class action determination rests, as we have indicated, on the twofold contention that the requirements of Rule 23(b) (3) are not met because: (1) common questions of law or fact do not predominate and (2) the class action is not "superior to other available methods for the fair and efficient adjudication of the controversy." Accordingly, we would review here not a finite and conclusive determination of judicial power -- e.g. the power to shift notice costs and forego individualized notice, as in Eisen, or the power to dispense with security, as in Cohen -- but a discretionary decision, the propriety of which will necessarily vary from case to case. That this distinction is of fundamental importance in the calculus of appealability was plainly acknowledged in Cohen itself. Mr. Justice Jackson stated:
But we do not mean that every order fixing security is subject to appeal. Here it is the right to security that presents a serious and unsettled question. If the right were admitted or clear and the order involved only an exercise of discretion as to the amount of security, a matter the statute makes subject to reconsideration from time to time, appealability would present a different question.
Cohen v. Beneficial Industrial Loan Corp., supra, 337 U.S. at 547. And see Weight Watchers of Phila. v. Weight Watchers Int., supra, 455 F.2d at 773.
A final distinction, which cannot be overlooked, is that in reviewing the legitimacy of the notice procedure authorized in Eisen, the Court was not called upon to consider any aspect of Eisen's underlying antitrust action against the odd-lot brokerage firms. Accommodating the notice procedure contemplated by Rule 23(c) (2) with the overriding considerations of due process is a task wholly divorced from review of the underlying merits of the action.
Although the interlocutory order granting class action status is thus clearly not appealable at this nascent stage in the litigation, GM argues that since we have jurisdiction to hear the appeal from the district court's order denying disqualification, we should exercise our discretionary power to consider this nonappealable order as well. To be sure, the doctrine of pendent jurisdiction at the appellate level has been utilized. See e.g. Deckert v. Independence Shares Corp., 311 U.S. 282, 85 L. Ed. 189, 61 S. Ct. 229 (1940); Wolf v. Green Corp., supra, Semmes Motors, Inc. v. Ford Motor Co., 429 F.2d 1197, 1201 (2d Cir. 1970); 9 J. Moore, Federal Practice para. 110.25 (2d ed. 1973). But, further analysis suggests the inappropriateness of exercising that power here.
The guiding principle to inform the discretionary application of pendent jurisdiction is whether review of the appealable order will involve consideration of factors relevant to the otherwise nonappealable order. See 9 J. Moore, supra, para. 110.25 at 272. In this case, it is transparently obvious that no such overlap exists between the order granting class action status and the order denying disqualification of counsel. "In addition," according to Professor Moore:
where an interlocutory order is properly appealed and review is sought of an incidental discretionary order, the appellate court should not review the discretionary order where there is no showing of an abuse of discretion.
Id. Professor Moore's observation suggests that he would look with disfavor upon the exercise of pendent jurisdiction in the instant case because the determination to grant class standing for a relatively small class (less than 200), where notice will be given to all identifiable class members and paid for by the plaintiff City, is clearly not a prima facie abuse of discretion. And, indeed, it would be particularly inappropriate for us to reach out to review this order, at this very early stage in the litigation, for, as we have already indicated, the district judge retains the flexibility to modify or even strike the class should further developments prove his initial determination erroneous.
In a final effort to gain review of the class action determination, GM has also followed the mandamus route in the event we should hold the class action order nonappealable. In denying the mandamus petition, suffice to say, as we did in Donlon Industries, Inc. v. Forte, 402 F.2d 935, 937 (2d Cir. 1968) and repeated in Weight Watchers of Phila. v. Weight Watchers Int., supra, 455 F.2d at 775:
we do not -- indeed may not -- issue mandamus with respect to orders resting in the district court's discretion, save in [the] most extraordinary circumstances not remotely presented here.
III. DISQUALIFICATION OF COUNSEL
We turn now to GM's unsuccessful motion to disqualify the City's privately-retained counsel, George Reycraft. It is necessary that we begin our discussion by focusing again on the language of Canon 9 of the Code of Professional Responsibility:
A lawyer should avoid even the appearance of professional impropriety.
Providing a measure of specificity to this general caveat, DR9-101(B) commands:
A lawyer shall not accept private employment in a matter in which he had substantial responsibility while he was a public employee.
The purpose behind this plain interdiction is not difficult to discern. Indeed, the City recognizes its salutary goal, as stated by the ABA Comm. on Professional Ethics, Opinions, No. 37 (1931)*fn18 to be:
[to avoid] the manifest possibility that . . . [a former Government lawyer's] action as a public legal official might be influenced (or open to the charge that it had been influenced) by the hope of later being employed privately to uphold or upset what he had done.
Id. at 124 (emphasis added). Viewed in this light, the question before us is whether Reycraft's decision to represent the City on a contingent fee basis in an antitrust suit strikingly similar, though perhaps not identical in every respect, to an antitrust action brought over his signature by the Department of Justice would raise an "appearance of impropriety," as private employment "to uphold . . . what he had done" as a Government lawyer. Unlike the court below, we are constrained to answer in the affirmative.
Before we commence our analysis, we would do well to recall the following description of our task:
We approach our task as a reviewing court in this case conscious of our responsibility to preserve a balance, delicate though it may be, between an individual's right to his own freely chosen counsel [we do not presume the City to have a lesser right] and the need to maintain the highest ethical standards of professional responsibility. This balance is essential if the public's trust in the integrity of the Bar is to be preserved.
Emle Industries, Inc. v. Patentex, Inc., 478 F.2d 562, 564-65 (2d Cir. 1973).
Indeed, the "public's trust" is the raison d'etre for Canon 9's "appearance-of-evil" doctrine. Now explicitly incorporated in the profession's ethical Code,*fn19 this doctrine is directed at maintaining, in the public mind, a high regard for the legal profession. The standard it sets -- i.e. what creates an appearance of evil -- is largely a question of current ethical-legal mores. See Kaufman, The Former Government Attorney and the Canons of Professional Ethics, 70 Harv. L. Rev. 657, 660 (1957).
Nor can we overlook that the Code of Professional Responsibility is not designed for Holmes' proverbial "bad man" who wants to know just how many corners he may cut, how close to the line he may play, without running into trouble with the law. Holmes, The Path of the Law, in Collected Legal Papers 170 (1920). Rather, it is drawn for the "good man," as a beacon to assist him in navigating an ethical course through the sometimes murky waters of professional conduct. Accordingly, without in the least even intimating that Reycraft himself was improperly influenced while in Government service, or that he is guilty of any actual impropriety in agreeing to represent the City here, we must act with scrupulous care to avoid any appearance of impropriety lest it taint both the public and private segments of the legal profession.
It is undisputed that Reycraft had "substantial responsibility" in initiating the Government's Sherman § 2 claim against GM for monopolizing or attempting to monopolize the nationwide market for city and intercity buses. Thus, we are left to determine whether the City's antitrust suit is the same "matter" as the Government's action and whether Reycraft's contingent fee arrangement with the City constitutes "private employment."
Directing our attention to the simpler question first, we are convinced beyond doubt that Reycraft's and, indeed, his firm's opportunity to earn a substantial fee for Reycraft's services is plainly "private employment" under DR9-101(B). The district judge apparently grounded his contrary decision on the rationale that Reycraft "has not changed sides" -- i.e. "there is nothing antithetical in the postures of the two governments in the actions in question. . . ." But, as we have already noted, Opinion No. 37 of the ABA Commission on Professional Ethics unequivocally applies the ethical precepts of Canon 9 and DR9-101(B) irrespective of the side chosen in private practice.*fn20 And see Allied Realty of St. Paul v. Exchange Nat. Bank of Chicago, 283 F. Supp. 464, 466 (D. Minn. 1968). We believe, moreover, that this is as it should be for there lurks great potential for lucrative returns in following into private practice the course already charted with the aid of governmental resources. And, with such a large contingent fee at stake, we could hardly accept "pro bono publico" as a proper characterization of Reycraft's work, simply because the keeper of the purse is the City of New York or other governmental entities in the class.
It is manifest also, from an examination of the respective complaints (see the appendix to this opinion), that the City's antitrust action is sufficiently similar to the 1956 Bus case to be the same "matter" under DR9-101(B). Indeed, virtually every overt act of attempted monopolization alleged in the City's complaint is lifted in haec verba from the Justice Department complanit. We cite, merely by way of illustration, paragraphs appearing in both complaints alleging the withdrawal of more than 20 companies from bus manufacturing, the coincidence of directors on the boards of GM and another bus manufacturer, the Flxible Company, and GM's acquisition of a controlling stock interest in Yellow Coach in 1925.
To be sure, as the City urges, the four-year statute of limitations, embodied in 15 U.S.C. § 15b, requires the City to focus on market conditions since 1968, some ten years after Reycraft ceased his involvement in the Bus case.*fn21 But, an equally essential element in proving a violation of Section 2 of the Sherman Act is either an intent to monopolize or an abuse of monopoly power. See United States v. Grinnell Corp., 384 U.S. 563, 570-71, 16 L. Ed. 2d 778, 86 S. Ct. 1698 (1966); Coniglio v. Highwood Services, Inc., 495 F.2d 1286, slip op. at 2911, 2924 (2d Cir. 1974); United States v. Aluminum Co. of America, 148 F.2d 416, 429-30 (2d Cir. 1945). Moreover, to decide the question whether GM is a passive recipient of monopoly power, a history of its operations will be imperative. See e.g. United States v. Aluminum Co. of America, supra (included an exhaustive study of Alcoa's operations from 1902 to the date of the lawsuit). Accordingly, at the very forefront of the City's case will be proof of alleged predatory practices amassed by the United States, with the substantial participation of Reycraft, when the Justice Department built its case against GM in 1956.
The addition of the Clayton Act claim, based solely on the same 1925 Yellow Coach acquisition which was part of the Sherman Act violation alleged by both the United States and the City, hardly alters the nuclear identity of these two suits.*fn22 Both, after all, allege monopolization or attempted monopolization of the same product line*fn23 -- city buses -- and, in the same geographic market -- the United States. The subtleties of differential proof will not obviate the "appearance of impropriety" to an unsophisticated public. We opined in Emle :
Nowhere is Shakespeare's observation that "there is nothing either good or bad but thinking makes it so," more apt than in the realm of ethical considerations.
Emle Industries, Inc. v. Patentex, Inc., supra, 478 F.2d at 571.
The City maintains, in the end, that if we reverse the court below and disqualify Reycraft, we will chill the ardor for Government service by rendering worthless the experience gained in Government employ. Indeed, the author of this opinion is hardly unaware of this claim, for he has cautioned:
If the government service will tend to sterilize an attorney in too large an area of law for too long a time, or will prevent him from engaging in the practice of a technical specialty which he has devoted years in acquiring, and if that sterilization will spread to the firm with which he becomes associated, the sacrifice of entering government service will be too great for most men to make.
Kaufman, supra, 70 Harv. L. Rev. at 668. But, in that commentary, and the case upon which it was based (United States v. Standard Oil Co. (N.J.), 136 F. Supp. 345 (S.D.N.Y. 1955) -- Esso Export Case), the accommodation between maintaining high ethical standards for former Government employees, on the one hand, and encouraging entry into Government service, on the other, was struck under far different circumstances. Unlike the instant case, in which Reycraft's "substantial responsibility" in the Bus case is undisputed, the writer of this opinion concluded in Esso Export that the lawyer:
never investigated or passed upon the subject matter of the pending case . . . never rendered or had any specific duty to render any legal advice in relation to the regulations involved in the litigation.
Kaufman, supra, 70 Harv. L. Rev. at 664. More to the point, therefore, is another admonition voiced in that article:
If there was a likelihood that information pertaining to the pending matter reached the attorney, although he did not "investigate" or "pass upon" it, . . . there would undoubtedly be an appearance of evil if he were not disqualified.
Id. at 665 (emphasis added)
Esso Export unquestionably presented a case for the cautious application of the "appearance-of-evil doctrine," because the former Government lawyer's connection with the matter at issue was the tenuous one of mere employment in the same Government agency. If, for example, Reycraft had not worked on the 1956 Bus case, but was simply a member of the Antitrust Division at that time, a case not unlike Esso Export would be before us. To the contrary, however, Reycraft not only participated in the Bus case, but he signed the complaint in that action and admittedly had "substantial responsibility" in its investigatory and preparatory stages. Where the overlap of issues is so plain, and the involvement while in Government employ so direct, the resulting appearance of impropriety must be avoided through disqualification.
Accordingly, we dismiss the appeal from the order granting class action status, and reverse the court's order denying disqualification of Reycraft.
The following comparison of portions of the complaints filed by the United States in the 1956 Bus case and by the City in the instant case was included in the record below:
Motors Corporation City of New York v. General
(1956 Bus case) Motors Corporation
15. Between 1925 and 1955 more 16. Between 1925 and 1971, more
than 20 manufacturers of buses with- than 20 bus manufacturers or bus
drew from the bus manufacturing assemblers withdrew from business.
business. Among these companies Among these companies were the fol-
are the following: lowing:
Ford Motor Company Ford ...