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Sea Tow International, Inc. v. Pontin

November 19, 2007

SEA TOW INTERNATIONAL, INC., PLAINTIFF,
v.
DUKE PONTIN, INDIVIDUALLY, AND DUKE PONTIN D/B/A/ SPIRIT TOWING D/B/A/ SEA TOW SERVICES FLORIDA KEYS, DEFENDANTS.



The opinion of the court was delivered by: Hon. E. Thomas Boyle United States Magistrate Judge

MEMORANDUM OPINION AND ORDER

Before the court is the application of the defendants, Duke Pontin ("Pontin") and Duke Pontin d/b/a Spirit Towing d/b/a Sea Tow Services Florida Keys (collectively referred to as "Pontin" or "defendants"), to disqualify Mitchell Stein ("Stein"), counsel for plaintiff Sea Tow International, Inc. ("Sea Tow"), as well as his law firm, Stein Law, P.C. ("Stein Law"), from representing Sea Tow in the within litigation. For the following reasons, defendant's motion is denied.

FACTS

This is an action for, inter alia, trademark infringement and breach of contract arising out of the termination by plaintiff of defendants' license to operate using plaintiff's "Sea Tow trademarks" and defendants' alleged failure to comply with certain contractual post-termination requirements of the licensing agreement entered into by plaintiff and defendants (the "Licensing Agreement"). (Compl. ¶ 1.) In their Amended Answer, defendants assert a counterclaim for breach of contract. A related proceeding is currently pending in Florida state court. See Pontin v. Sea Tow Servs. Int'l, Inc., No. 44-2001-CA-111-K (Fla. Monroe County Ct.) (the "Florida Action").*fn1

Defendants seek to disqualify Stein on the grounds that he is a central and necessary witness in this action. Defendants assert that Stein's testimony in the Florida Action demonstrates that Stein has personal knowledge of the issues at the heart of the within litigation, necessitating his testimony here. According to defendants, since Stein is a necessary witness, Disciplinary Rule 5-102 mandates his disqualification as counsel in this action. Alternatively, defendants seek Stein's disqualification under Disciplinary Rule 5-101 on the grounds that Stein has a conflict of interest that prevents him from being able to adequately represent Sea Tow in this action.

DISCUSSION

I. Legal Standard

"[T]he disqualification of an attorney upon the motion of an adversary is a serious sanction that ought not to be imposed lightly." Shabbir v. Pakistan Int'l Airlines, 443 F. Supp. 2d 299, 304 (E.D.N.Y. 2005). Indeed, it is well-established that "[m]otions to disqualify opposing counsel are viewed with disfavor in this Circuit because they are 'often interposed for tactical reasons' and result in unnecessary delay." Bennett Silvershein Assoc. v. Furman, 776 F. Supp. 800, 802 (S.D.N.Y. 1991) (quoting United States Football League v. Nat'l Football League, 605 F. Supp. 1448, 1452 (S.D.N.Y. 1985) (collecting cases)). The Second Circuit has "been loathe to separate a client from his chosen attorney," Bohack Corp. v. Gulf & Western Indus., Inc., 607 F.2d 258, 263 (2d Cir. 1979), noting that "[t]he delay and additional expense created by substitution of counsel is a factor to which [it has] attached considerable significance . . . ." Id. (citing Lefrak v. Arabian Am. Oil Co., 527 F.2d 1136, 1138-40 (2d Cir. 1975)). Although any doubts are to be resolved in favor of disqualification, see Cheng v. GAF Corp., 631 F.2d 1052, 1059 (2d Cir. 1980), vacated on other grounds and remanded, 450 U.S. 903 (1981), the party seeking disqualification bears a "heavy burden" of demonstrating that disqualification is warranted. Evans v. Artek, 715 F.2d 788, 794 (2d Cir. 1983).

"The objective of the disqualification rule is to 'preserve the integrity of the adversary process.'" Evans, 715 F.2d at 791 (quoting Bd. of Educ. v. Nyquist, 590 F.2d 1241, 1246 (2d Cir. 1979). In deciding a motion to disqualify counsel, the court must "balance 'a client's right freely to choose his counsel' against 'the need to maintain the highest standards of the profession.'" Hempstead Video, Inc. v. Inc. Village of Valley Stream, 409 F.3d 127, 132 (2d Cir. 2005) (quoting Gov't of India v. Cook Indus., Inc., 569 F.2d 737, 739 (2d Cir. 1978)). Although courts typically look to the American Bar Association and state disciplinary rules when rendering decisions on disqualification motions, "such rules merely provide general guidance and not every violation of a disciplinary rule will necessarily lead to disqualification."

Hempstead Video, 409 F.3d at 132 (citing Nyquist, 590 F.2d at 1246).

The decision to disqualify counsel is committed to the sound discretion of the district court. See Cresswell v. Sullivan & Cromwell, 922 F.2d 60, 72 (2d Cir. 1990). Nonetheless, "[r]ecognizing the serious impact of attorney disqualification on the client's right to select counsel of his choice," Glueck v. Jonathan Logan, Inc., 653 F.2d 746, 748 (2d Cir. 1981), the Second Circuit has instructed that disqualification should only be imposed upon a finding that the presence of a particular attorney "poses a significant risk of trial taint." Id.; see also Bottaro v. Hatton Assoc., 680 F.2d 895, 896 (2d Cir. 1982) (citing Nyquist, 590 F.2d at 1246). "Where the threat of tainting the trial does not exist . . . the litigation should proceed, the remedy for unethical conduct lying in the disciplinary machinery of the state and federal bar." Bottaro, 680 F.2d at 896-97 (citing Armstrong v. McAlpin, 625 F.2d 433, 444 (2d Cir. 1980), vacated on other grounds and remanded, 449 U.S. 1106 (1981)).

II. Disqualification Under Disciplinary Rule 5-102

New York's Disciplinary Rule 5-102 ("DR 5-102") pertains to situations in which lawyers may be called as witnesses, commonly referred to as the "witness-advocate" or "advocate-witness" rule. Pursuant to subsection (a) of DR 5-102, the basis upon which defendants seek Stein's disqualification, "[a] lawyer shall not act, or accept employment that contemplates the lawyer's acting, as an advocate on issues of fact before any tribunal if the lawyer knows or it is obvious that the lawyer ought to be called as a witness on a significant issue on behalf of the client," except in certain enumerated circumstances.*fn2 N.Y. Comp. Codes R. & Regs. tit. 22, § 1200.21(a) (2007). New York courts have interpreted DR 5-102(a) to require disqualification "only when it is likely that the testimony to be given by the witness is necessary." S&S Hotel Ventures Ltd. P'Ship v. 777 S.H. Corp., 69 N.Y.2d 437, 445-46 (1987); see also Purgess v. Sharrock, 33 F.3d 134, 144 (2d Cir. 1994) ("Disqualification may be required only when it is likely that the testimony to be given by [counsel] is necessary.") (quotation omitted); Norman Reitman Co., Inc. v. IRB-Brasil Resseguros S.A., No. 01 Civ. 0265, 2001 WL 1132015, at *2 (S.D.N.Y. Sept. 25, 2001) ("In order to disqualify an attorney on the basis of the advocate-witness rule, a party must demonstrate that the testimony is . . . necessary . . . .") (citation omitted). "Testimony may be relevant and even highly useful but still not strictly necessary." Forrest v. Par Pharm., Inc., 46 F. Supp. 2d 244, 248 (S.D.N.Y. 1999); S&S Hotel Ventures, 69 N.Y.2d at 446 (same).

To determine the necessity of counsel's testimony, courts take into account such factors as the significance of the matters to be attested to, the weight of the testimony to be given and the availability of other evidence. See Norman Reitman Co., 2001 WL 1132015, at *3; Forrest, 46 F. Supp. 2d at 248; S&S Hotel Ventures, 69 N.Y.2d at 446. The party seeking disqualification "bears a heavy burden," Conigliaro v. Horace Mann Sch., No. 95 Civ. 3555, 1997 WL 189058, at *3 (S.D.N.Y. Apr. 17, 1997) of establishing necessity, "which cannot be met with '[m]ere speculation.'" Id. (quoting Paretti v. Cavalier Label Co., 722 F. Supp. 985, 987 (S.D.N.Y. 1987)). Moreover, "if the facts to which the lawyer would testify could be elicited from another witness, or the lawyer's testimony would be cumulative of other evidence, disqualification may be inappropriate." Drywall Tapers and Pointers of Greater New York v. Local 530, No. 93-CV-154, 1996 WL 1088933, at *4 (E.D.N.Y. Oct. 24, 1996) (citing Purgess, 33 F.3d at 144). Finally, while "the ...


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