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O'Keefe v. ACE Restaurant Supply, LLC

United States District Court, E.D. Pennsylvania

March 27, 2017



          R. BARCLAY SURRICK, J.

         Presently before the Court is Plaintiffs' Combined Motion and Memorandum to Disqualify James Christopher Froelich, Esq. from Representing Defendants at Trial. (ECF No. 32.) After review of Plaintiffs' Combined Motion and Memorandum, Defendants' Memorandum of Law in Opposition thereto (ECF No. 36), and the applicable law, Plaintiffs' Motion will be denied.


         A. Factual Background

         The relevant factual background to this case was put forth in our January 11, 2016 Memorandum and Order denying Defendants' Motion to Dismiss. (ECF No. 12.) Plaintiff Joseph O'Keefe is the owner of Plaintiff Simmeria Café & Bistro (“Simmeria”). Defendants Korey and Nick Blanck own Defendant Ace Restaurant Supply. Ace sells bar and restaurant equipment in Pennsylvania as well as other states through its website.

         In February 2010, O'Keefe called Korey Blanck and inquired about buying supplies for Simmeria, his new restaurant. On February 12, 2010, Plaintiffs and Defendants executed a sales agreement for $20, 602.16. (Compl. ¶ 15; Ex. A, ECF No. 1.) The agreement was faxed from Korey Blanck to O'Keefe. Plaintiffs allege that they entered into the contract based on false representations made by Korey Blanck and Ace's website that Defendants could provide Plaintiffs with their equipment needs. On March 16, 2010, Plaintiffs and Defendants entered into another sales contract for equipment worth $4, 672.48. (Id. ¶ 16; Ex. B.) Plaintiffs made a total payment to Defendants of $35, 803.62 in advance, an amount which presumably includes additional fees not itemized in the Complaint.

         Plaintiffs allege that after they made this payment, the “true face of [Defendants'] operation began to unravel.” (Id. ¶ 18.) Defendants failed to deliver a grill and an oven that Plaintiffs ordered. Plaintiffs unsuccessfully pressed Defendants with regard to the whereabouts of their purchases. Defendants either ignored Plaintiffs' calls or responded with dishonest excuses. For instance, in March and April 2010, Korey Blanck repeatedly assured O'Keefe that he had ordered the oven and that the manufacturer was at fault for the delay. O'Keefe then called the manufacturer and was told that Defendants had never ordered the oven. (Id. ¶ 21.) When Defendants did make deliveries, they shipped equipment that was broken and useless. Plaintiffs allege that Defendants were aware that the equipment failed to meet their needs, but nevertheless proceeded with the deliveries with the intent to defraud them. (Id. ¶ 22.)

         On May 20, 2010, O'Keefe sent a letter demanding that Defendants either deliver all of the missing and broken equipment or refund the money. (Id. ¶ 23; Ex. C.) The next day, Korey Blanck responded with a letter in which he disputed O'Keefe's portrayal of their business transactions and refused to refund any money.[1] (Compl. ¶ 24; Ex. D.)

         Plaintiffs claim that Defendants' deceitful behavior was characteristic of the way they conducted business. (Id. ¶ 27.) Plaintiffs allege in their Complaint that Defendants regularly made fraudulent misrepresentations regarding equipment that they never intended to deliver. In Plaintiffs' Response to Defendants' Motion to Dismiss, they attached two state court complaints filed against Defendants that allege similar conduct. (Pls.' Resp. Exs. A-B, ECF No. 8.) We considered these public records as part of the pleadings. One of the complaints was filed in the Court of Common Pleas of Berks County, and alleges that Defendant Ace misrepresented the character of a fryer that the plaintiff in that action bought from Ace. (Id. at Ex. A.) The plaintiff in that litigation had purchased the fryer on September 16, 2009. The other state court complaint against Defendants alleged that on June 20, 2008, the plaintiffs in that matter entered into a sales agreement with Defendants to purchase certain restaurant supplies. (Id. at Ex. B ¶ 7.) The plaintiffs there alleged that Defendants breached the contract and committed fraud by failing to deliver and install the items in the agreement.

         B. Procedural History

         On February 25, 2011, Plaintiffs filed a Complaint against Defendants alleging a violation of the Racketeer Influenced and Corrupt Organizations Act (“RICO”), 18 U.S.C. § 1962(c) (Count I), a RICO conspiracy claim, id. § 1962(d) (Count II), and state law claims of fraud (Count III), unjust enrichment (Count IV), intentional misrepresentation (Count V), and negligent misrepresentation (Count VI). Plaintiffs also sought declaratory relief (Count VII).[2]

         On December 29, 2016, Plaintiffs filed the instant Motion to Disqualify Counsel, James Christopher Frelich, Esq. (Pls.' Mot., ECF No. 32.) That same day, Defendants filed motions in limine to preclude any and all evidence of actions filed against Defendants. (ECF Nos. 33-34.) On January 16, 2017, Defendants filed their Response in Opposition to Plaintiffs' motion in limine. (ECF No. 35.) On January 18, 2017, Defendants filed their Response in Opposition to Plaintiffs' Motion to Disqualify Counsel. (Defs.' Resp., ECF No. 36.)


         Rule 83.6 of the Local Rules of Civil Procedure for the Eastern District of Pennsylvania provides the Rules of Attorney Conduct. Rule IV(B) provides, inter alia, that “[t]he Rules of Professional Conduct adopted by this court are the Rules of Professional Conduct adopted by the Supreme Court of Pennsylvania.” Under these rules, the court has the authority to disqualify counsel if the facts of the particular case suggest that disqualification is necessary to enforce the intended goal of the applicable disciplinary rule. Of course, “[t]he district court's power to disqualify an attorney derives from its inherent authority to supervise the professional conduct of attorneys appearing before it.” Adeniyi-Jones v. State Farm Mut. Auto. Ins. Co., No. 14-7101, 2016 WL 3551486, at *2-3 (E.D. Pa. June 30, 2016) (internal quotation marks omitted); see United States v. Miller, 624 F.2d 1198, 1201 (3d Cir. 1980) (citing Richardson v. Hamilton Int'l Corp.,469 F.2d 1382, 1385-86 (3d Cir. 1972)). However, a motion to disqualify counsel should be granted “only when [the Court] determines, on the facts of the particular case, that disqualification is an appropriate means of enforcing the applicable disciplinary rule.” Reg'l Employers' Assur. Leagues Voluntary Employees' Beneficiary Ass'n Trust v. Castellano, No. 03-6903, 2009 WL 1911671, at *2 (E.D. Pa. July 1, 2009) (quoting Miller, 624 F.2d at 1201). In making such a determination, the district court “should consider the ends that the disciplinary rule is designed to serve and any countervailing policies, such as permitting a litigant to retain the counsel of his choice and enabling attorneys to practice without excessive restrictions.” Id. Even if a court finds that an attorney violated a disciplinary rule, however, “disqualification is never automatic.” Id. In fact, motions to disqualify are unusual and are generally disfavored given that they seek to deprive parties of their choice of counsel and may be motivated by improper tactical considerations. Cipressi v. Bristol Borough, No. 10-1584, 2012 WL 606687, at *2 (E.D. Pa. Feb. 27, 2012); Wolf, Block, Schorr & Solis-Cohen LLP, No. 05-6038, 2006 WL 680915, at *1 (E.D. Pa. Mar. 9, 2006) (“[M]otions to disqualify opposing counsel are disfavored . . . not only because disqualification robs one's adversary of her counsel of choice, but also because of the risk . . . that one could subvert the ethical rules in an attempt to use ...

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