DATE: Febuary 6, 1995
CASE NO. 93-ERA-25
IN THE MATTER OF
EDWARD P. HOLUB,
COMPLAINANT,
v.
H. NASH BABCOCK, ET AL.,
RESPONDENTS.
BEFORE: THE SECRETARY OF LABOR
ORDER REVERSING DISQUALIFICATION
Respondents have appealed the presiding Administrative
Law Judge's (ALJ's) Order of Disqualification and Limited Stay
of Proceeding issued in this case on December 9, 1994
(Disqualification Order). Under the applicable regulation,
29 C.F.R. § 18.36(b) (1994), such an appeal is made to the
Department's Chief Administrative Law Judge (Chief Judge). The
Chief, Deputy Chief, and Associate Chief Judges have recused
themselves from deciding the appeal in this case. [1]
The Deputy Chief Judge initially suggested referring the
appeal to the chief administrative law judge of another Federal
agency (December 14, 1994 Order to Show Cause) but both parties
objected. Pursuant to 29 C.F.R. § 18.1(b) (1994), [2] the
Deputy Chief Judge, without objection from either party, now
suggests that the Secretary decide the appeal of the
Disqualification Order. Dec. 20 Order to Show Cause. Pursuant
to that regulation, and in the interests of justice, I will
decide the appeal. The decision of the ALJ is reversed, and the
matter is remanded for further proceedings consistent with this
decision.
BACKGROUND
[PAGE 2]
In June 1994, the presiding ALJ issued an Order revealing
that Attorney Eugene R. Fidell, who had entered an appearance as
one of Respondents' attorneys in this case, also represents Chief
Judge Litt in a proceeding before the United States Merit Systems
Protection Board (MSPB) in which the Deputy Secretary of Labor
seeks Litt's removal as Chief Judge. [3] Complainant Edward P.
Holub filed a motion seeking Fidell's disqualification in this
case because the Chief Judge exercises certain procedural
authority in cases brought under the Energy Reorganization Act of
1974, 42 U.S.C. § 5851 (1988).
Fidell stated that he did not notify the presiding ALJ or
opposing counsel of his representation of Chief Judge Litt
because he knew of no reason why that representation has any
bearing on the propriety of his representing Respondents in this
case. Respondents' Response to June 10, 1994 Order at 2.
Respondents argued that none of the procedural provisions
requiring action by the Chief Judge had come into play since
Fidell entered his appearance in this case, and that if a
situation occurred that required such action, the Chief Judge
would have to recuse himself. Respondents' Answer to Motion to
Disqualify at 1-2.
Upon finding that Mr. Fidell's concurrent representation of
Respondents and the Chief Judge "raises the potential for ex
parte contact," and that "the potential for shared
confidences in this situation creates an appearance of
impropriety sufficient to taint the instant proceedings," the
presiding ALJ issued an Order requiring Fidell to show cause why
he should not be disqualified from representing Respondents in
this matter. July 28, 1994, Order to Show Cause Why Attorney
Eugene R. Fidell Should Not Be Disqualified at 55, 59 (July 28
Show Cause Order).
After considering the parties' responses, the presiding ALJ
affirmed the analysis in the July 28 Show Cause Order,
disqualified Fidell from representing Respondents in this matter,
and granted a stay of proceedings for 30 days to permit
Respondents to advise whether they had retained additional
counsel or wished to proceed with other existing counsel.
December 9, 1994, Order of Disqualification and Limited Stay of
Proceedings (Disqualification Order). Respondents appealed
the Disqualification Order. The ALJ issued an order refusing
to extend the stay pending determination of this appeal.
January 18, 1995 Order.
DISCUSSION
Although the presiding ALJ acknowledges that the interests
of Respondents in this case and those of the Chief Judge in the
case before the MSPB are not adverse, she found that the two
clients' relationship is "discordant" and has "the potential to
taint" this proceeding. July 28 Show Cause Order at 55-56.
[PAGE 3]
Absent a party's representation by the same counsel, however,
there is no connection between the two cases. The parties,
facts, witnesses, and legal issues in the two cases are
different.
Chief Judge Litt has exercised no authority in this case
since the time Respondents engaged Mr. Fidell as counsel. [4] I
do not see how "the existence of Mr. Fidell's attorney-client
relationship with the Chief Judge raises the potential for
exparte contact." July 28 Show Cause Order at 55.
Since the Chief Judge exercises no substantive role and has
indicated that he
will exercise no procedural role in this case, [5] there is no
basis to assume that he would have any impermissible contact
concerning the merits of this case.
The presiding ALJ painted a scenario in which Mr. Fidell
raised with the Chief Judge the issue of a potential conflict of
interest. The ALJ stated that Mr. Fidell did this "without
raising the matter with Complainant or this tribunal."
Disqualification Order at 5. The ALJ found, therefore, that an
exparte communication occurred and a clear
conflict of interest exists. Id. I find that obtaining
the Chief Judge's consent to the dual representation did not
constitute an impermissible exparte communication,
defined in the applicable regulation, 29 C.F.R. § 1838(a) (1994),
as: "a communication on any fact in issue." [6] The communication
did not concern a fact in issue in this proceeding, which will determine
if the Respondents have violated the whistleblower provision of the
ERA. Nor was the communication made to a person involved in the
decisional process of this case.
Likewise, the fact that Respondents' counsel represents the
Chief Judge in a separate personnel matter does not lead me to
believe that Respondents could or would use that representation
as a means to influence the presiding ALJ in the handling or the
decision in this case. The presiding ALJ will handle all legal
and factual issues presented in this case. The Chief Judge will
have no substantive or procedural role in the case. [7] As the
presiding ALJ points out, July 28 Show Cause Order at 58, she has
a statutorily protected tenure of office and does not receive
performance ratings. Further, in the entire 60 plus pages of the
July 28 Show Cause Order, the ALJ never asserts that the Chief
Judge has any influence over her in deciding this case.
Therefore, there is no basis to believe that Mr. Fidell's
dual representation could somehow bias the process toward
Respondents.
In this case, the "potential for shared confidences" which
concerned the presiding ALJ, July 28 Show Cause Order at 59, is
virtually nonexistent since the MSPB matter is not related to
this ERA complaint. [8] It is difficult to envision the type of
[PAGE 4]
confidences that might be shared in violation of any applicable
ethical guidelines. Respondents' confidences concerning its
defenses to the ERA complaint have nothing to do with the issues
in the removal of Mr. Litt as the Chief Judge. Likewise,
Mr. Litt's confidences concerning his administration as Chief
Judge have nothing to do with the substance of this case in which
he has not and will not have a decisional role.
The presiding ALJ also found an actual conflict of interest
in the revelation by Professor Green, Respondents' expert on
legal ethics, that the Chief Judge would recuse himself if a
party appealed a disqualification order in this matter.
Disqualification Order at 4. While it may have been more
appropriate for Respondents' counsel and/or Respondents' expert
to have no contact with the Chief Judge concerning his role, if
any, in this ERA matter, I do not find that such a contact
created an actual conflict of interest. The need for the contact
in question only arose as a result of the disqualification
motion. The complainant should not benefit from a
disqualification motion filed on his behalf which creates
previously nonexistent grounds for disqualification.
I agree with the ALJ that the tribunal deciding an attorney
disqualification motion must balance a party's right to the legal
representative of his choice against the need to avoid ethical
conflicts and the threat of taint to a proceeding if the attorney
remains. July 28 Show Cause Order at 60. In making that
judgment in this case, I find that there is no actual ethical
conflict in Mr. Fidell's dual representation and that the threat
of taint to this proceeding is remote. Accordingly, I reverse
the order disqualifying Mr. Fidell from representing the
Respondents in this matter.
In light of the reversal of the disqualification, I will
order the presiding ALJ to grant Respondents an additional 20
days to supplement any documents required to be filed during the
time Mr. Fidell was wrongfully disqualified.
CONCLUSION
The December 9, 1994 Order of Disqualification is reversed.
Attorney Eugene R. Fidell may continue to represent the
Respondents in this proceeding. It is ORDERED that the presiding
Administrative Law Judge shall grant Respondents an additional
20 days to supplement any court document filed during the time
the Order of Disqualification was in effect.
SO ORDERED.
ROBERT B. REICH
Secretary of Labor
Washington, D.C.
[PAGE 5]
[ENDNOTES]
[1] See December 20, 1994, Order Referring Appeal to the
Secretary of Labor at 1.
[2] 29 C.F.R. § 18.1 (1994) provides in relevant part:
(b) Waiver, modification, or suspension. Upon
notice to all parties, the administrative law judge
may, with respect to matters pending before him or her,
modify or waive any rule herein upon a determination
that no party will be prejudiced and that the ends of
justice will be served thereby. These rules may, from
time to time, be suspended, modified or revoked in
whole or part.
[3] The Deputy Secretary seeks to remove Mr. Litt only from the
position of Chief Judge; he would not be removed from the corps
of ALJs. Contrary to the presiding ALJ's and the parties'
statements, the Solicitor of Labor did not bring the action, but
rather, represents the party bringing the action.
[4] The Chief Judge performed only ministerial duties, such as
receiving the request for a hearing and assigning the case to the
presiding ALJ, long before Mr. Fidell entered an appearance in
this matter.
[5] I disagree that the Chief Judge's recusal is irrelevant to
the disqualification issue. See July 28 Show Cause Order
at 61.
[6] The Administrative Procedure Act also prohibits exparte communications concerning the merits of an
"on the record" proceeding such as this. Under 5 U.S.C. §
557(d)(1) (1988):
(A) no interested person outside the agency shall make
or knowingly cause to be made to any member of the body
comprising the agency, Administrative Law Judge, or
other employee who is or may reasonably be expected to
be involved in the decisional process of the
proceeding, an exparte communication
relevant to the merits of the proceeding.
[7] The Chief Judge is on record as having a conflict regarding
this case which would preclude him from playing any procedural or
substantive role in the future.
[8] The lack of a factual or legal relationship between the two
cases at issue here distinguishes two court cases on which the
presiding ALJ relied heavily. In Emle Industries, Inc. v.
Patentex, Inc., 478 F.2d 562 (2d Cir. 1973), the court
disqualified an attorney who switched sides to represent a
formerly opposing party in a case raising the same factual and
legal issues. Hull v. Celanese Corp., 513 F.2d 568 (2d
Cir. 1975), concerned disqualification of an attorney who
switched sides to become a plaintiff in a sex discrimination case
against the employer whom the attorney formerly had defended in
the same suit. The potential for revealing shared confidences
clearly was great in Emle and Hull because of the
unity of parties and issues. That is not the case here.
