These cases involve an alleged conflict of interest on the part of plaintiffs' attorney. They came before the court on a defense motion to disqualify him and to dismiss the suits because of the representation by plaintiffs' counsel of a potentially adverse party at the time of the incident from which the actions arose. Following a hearing and after consideration of counsels' briefs, I concluded that no prejudice had resulted or would result to either the plaintiffs or defendants from the continued participation of plaintiffs' present attorney, and accordingly denied defendants' motion. A review of that order has been sought in the court of appeals. I am filing this opinion to elaborate upon the reasons for my decision.
These cases arose out of an accident which occurred on November 26, 1974, during an attempt to re-rail a hopper car onto tracks owned and maintained by Lehigh Valley Railroad Company ("Lehigh"). The car, loaded with 200,000 pounds of salt, had been hoisted into the air by a railroad crane. Joseph Baglini, Robert H. Jenkins, and James W. Fraboni, all Lehigh employees acting within the scope of their employment, were near or under the car positioning railroad ties so that the car could be returned to the tracks. At that moment, a part of the car to which the crane had been hooked tore loose and the car fell. As a result, Baglini and Jenkins died and Fraboni sustained personal injuries. Invoking the diversity jurisdiction of this court, the respective administratrices of the estates of Baglini and Jenkins instituted wrongful death and survival actions
against Pullman Incorporated and Pullman Leasing Co., Inc. (hereinafter collectively designated as "Pullman"), which manufactured the hopper car, and Cargill, Inc., which leased it. Fraboni also sued to recover for personal injuries he received in the accident. All three actions are premised on theories both of strict liability and negligence.
Pullman denied liability but also joined Southwest Railway Co. ("Southwest") and Lehigh as third-party defendants,
alleging that they were solely liable or liable over for any damages suffered by plaintiffs. Lehigh subsequently filed cross-claims and counterclaims against the other third-party defendants and Pullman. Plaintiffs eventually filed amended complaints which named the original defendants and third-party defendants -- with the exception of Lehigh -- as multiple defendants, and sought recovery under the same theories as advanced in the original complaint.
At some point thereafter, Pullman learned that plaintiffs' counsel of record, Richard F. Stevens, Esquire, of the firm of Butz, Hudders & Tallman, of Allentown, Pennsylvania, as the representative of Lehigh,
had participated in the investigation of the incident which is the basis of this suit. Especially objectionable from Pullman's viewpoint was Mr. Stevens' presence on behalf of Lehigh at a December 10, 1974, meeting attended by Pullman and Cargill personnel at the railroad's Sayre, Pennsylvania, offices. Alleging that the representation of plaintiffs in this action by Mr. Stevens and his law firm, in light of their representation of Lehigh, violates Canons 1
, and 9
of Professional Ethics of the American Bar Association, Pullman moved this court to (1) disqualify plaintiffs' counsel and his firm, (2) dismiss these actions, and (3) frame protective orders enjoining Mr. Stevens and the firm of Butz, Hudders & Tallman from exchanging advice or information with any future counsel plaintiffs may retain.
At the outset, it is plain that by virtue of regulatory power over the members of its bar, this court possesses jurisdiction to enforce the canons of legal ethics. Richardson v. Hamilton International Corp., 333 F. Supp. 1049, 1052 (E.D. Pa. 1971), aff'd. 469 F.2d 1382 (3d Cir. 1972), cert. denied, 411 U.S. 986, 93 S. Ct. 2271, 36 L. Ed. 2d 964 (1973); E. F. Hutton & Co. v. Brown, 305 F. Supp. 371, 378 (S.D. Tex. 1969). As the Court of Appeals for this Circuit observed in Richardson v. Hamilton International Corp., supra:
Whenever an allegation is made that an attorney has violated his moral and ethical responsibility, an important question of professional ethics is raised. . .. The courts, as well as the bar, have a responsibility to maintain public confidence in the legal profession. This means that a court may disqualify an attorney for not only acting improperly but also for failing to avoid the appearance of impropriety [footnote omitted].