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Riley v. PK Management, LLC

United States District Court, D. Kansas

September 9, 2019

LEORA RILEY, et al., Individually and on behalf of all others similarly situated, Plaintiffs,
PK MANAGEMENT, LLC, et al., Defendants.


          Teresa J. James, U.S. Magistrate Judge

         This matter is before the Court on the Motion for Sanctions filed by Defendant Aspen Companies Management, LLC (ECF No. 212). Aspen seeks an order disqualifying Plaintiffs' counsel because of an alleged violation of Kansas Rule of Professional Conduct 4.2. Plaintiffs oppose the motion.[1] Upon consideration of the matter, the Court finds the motion should be denied.


         This case began in January 2018 when Central Park Towers filed three limited action unlawful detainer lawsuits in the District Court of Wyandotte County, Kansas against Leora Riley, Terri Ozburn, and Carolyn Bell, respectively. In each of the landlord-tenant actions, Central Park Towers sought possession of the premises and past-due rent. On April 3, 2018, Leora Riley, Terri Ozburn, and Carolyn Bell filed (1) their answers to Central Park Towers' petitions, (2) counterclaims against Central Park Towers, and (3) third-party claims against PK Management, LLC. On April 13, 2018, Plaintiff Central Park Towers dismissed these three Wyandotte County lawsuits without prejudice. On May 3, 2018, counterclaim plaintiffs/third-party plaintiffs Leora Riley, Terri Ozburn, and Carolyn Bell dismissed their counterclaims against Central Park Towers without prejudice.[2]

         Following dismissal of the actions for possession and past-due rent, Plaintiffs sought and obtained permission to realign the parties to their current configuration. On June 6, 2018, Plaintiffs filed their First Amended Class Action Petition in the District Court of Wyandotte County, Kansas.[3] Defendant PK Management, LLC timely filed a notice of removal.[4]

         Plaintiffs' First Amended Class Action Petition includes seven counts. And because Plaintiffs filed this case in state court, the original pleading does not use the language of Federal Rule of Civil Procedure 23(b) to describe the types of class actions it asserts.[5] In their Second Amended Class Action Complaint, filed July 15, 2019, Plaintiffs (1) conform their pleading to reflect the language of Rule 23(b) regarding the types of class actions they assert, and add a “limited fund class” under Rule 23(b)(1)(B); (2) add factual allegations learned in discovery; (3) add a count alleging negligence against all Defendants; and (4) seek punitive damages in the counts alleging violations of an implied warranty of habitability (Count Two), breach of statutory duty to materially comply with lease and to provide habitable housing (Count Three), nuisance (Count Seven), and negligence (Count Eight).[6]

         The parties have been actively conducting discovery and the Court has ruled on several discovery and other pretrial motions. However, this is the first mention of the issue raised in the instant motion. On September 19, 2018, Aspen's[7] Social Services Coordinator Keirei Broadus telephoned Bell Law, LLC.[8] Ms. Broadus indicated she was seeking representation and specifically asked to join this lawsuit. Janis Bell, the law firm employee who answered the call, recognized Ms. Broadus's name. After the conversation ended, Ms. Bell told Brandon Bell of the call.[9] He determined he could not represent Ms. Broadus and based on the information she had provided, he thought it likely that Ms. Broadus's interests were likely adverse to Aspen's.[10]Mr. Bell directed Ms. Bell to call Ms. Broadus and ask if she was represented by counsel. If not, Ms. Bell was to refer Ms. Broadus to Christopher Dandurand of the Gorny Law Firm.[11] Ms. Bell telephoned Ms. Broadus on September 20, 2018, learned she was not represented, and provided her with contact information for Mr. Dandurand. Ms. Bell has not communicated with Ms. Broadus since then.[12]

         Ms. Broadus did contact Mr. Dandurand, asking him to represent her with respect to potential claims against Aspen, including claims arising from mold and work environment issues at Central Park Towers. Mr. Dandurand agreed to represent her, with the scope of his representation to include both the potential claims just described and in this case if she is asked to sit for deposition.[13] Sometime later in September or in October, 2018, Mr. Dandurand contacted Mr. Bell as a standard referral follow-up to advise Mr. Bell of his representation of Ms. Broadus.[14]

         Eight or nine months later, Mr. Bell asked Mr. Dandurand if he could meet with Ms. Broadus and Mr. Dandurand. Mr. Dandurand obtained Ms. Broadus's consent and arranged a meeting for the three of them in his office on July 10, 2019. Mr. Dandurand was present the entire time. Ms. Broadus confirmed that Mr. Dandurand is her attorney, and she gave no indication that any other attorney (including counsel for Aspen) is representing or has represented her. Mr. Bell identified himself as counsel for Plaintiffs Leora Riley and Terri Ozburn.[15] Mr. Bell did not ask for nor has Ms. Broadus provided any documents, including an affidavit.[16]

         Aspen's counsel learned of the meeting, and on July 15, 2019, Aspen attorney Jeffrey Bullins contacted Mr. Dandurand. Mr. Bullins stated that he represents Ms. Broadus, which surprised Mr. Dandurand, who in turn stated that he represents her.[17] Although Mr. Bullins conceded he had no written agreement with Ms. Broadus, he was referring to a meeting his associate Phil Raine had with Ms. Broadus in which he informed her that he and Mr. Bullins represent Aspen and all of its employees, including Ms. Broadus, in this lawsuit.[18] During that meeting, Ms. Broadus did not tell Mr. Raine that Mr. Dandurand represents her, which may be because the meeting occurred before she engaged Mr. Dandurand. Nor did Ms. Broadus tell Messrs. Bullins or Raine that she had counsel at any time after the meeting. After speaking with Mr. Dandurand, Mr. Bullins accepted Mr. Dandurand's confirmation that “Ms. Broadus has chosen to terminate my firm's representation of her in this matter.”[19] Mr. Dandurand offered to make Ms. Broadus available for deposition, but to date no party has sought to depose her.

         Legal Standard

         Although Aspen styles its motion as one for sanctions, its sole focus is to seek disqualification of counsel.[20] The Court has the power to disqualify counsel at its discretion for ethical violations, using the following standard:

The Court must determine a motion to disqualify counsel by measuring the facts of the particular case. Beck v. Board of Regents of State of Kan., 568 F.Supp. 1107, 1110 (D. Kan. 1983). The moving party must show proof that is more than mere speculation and sustains a reasonable inference of a violation. Koch, 798 F.Supp. at 1530-31. The essential issue is whether the alleged misconduct taints the lawsuit. Id. The Court should not disqualify unless “the offending attorney's conduct threatens to ‘taint the underlying trial' with a serious ethical violation.” Field v. Freedman, 527 F.Supp. 935, 940 (D. Kan. 1981). Because the interests to be protected are critical to the judicial system, the Court should resolve doubts in favor of disqualification. Id. The Court must balance several factors, however, including society's interest in ethical conduct, defendants' right to choose their counsel, and the hardship which disqualification would impose on the parties and the entire judicial process. Lansing-Delaware Water Dist. v. Oak Lane Park, Inc., 248 Kan. 563, 571, 808 P.2d 1369, 1375 (1991).[21]

         As Judge Vratil noted, because disqualification affects more than the attorney in question, “the Court must satisfy itself that this blunt remedy serves the purposes behind the ethical rule in question.”[22]


         Aspen contends that Mr. Bell violated Rule 4.2 of the Kansas Rules of Professional Conduct by engaging in ex parte communications with Mr. Broadus. Rule 4.2 states as follows:

In representing a client, a lawyer shall not communicate about the subject of the representation with a person the lawyer knows to be represented by another lawyer in the matter, unless the lawyer has the consent of the other lawyer or is authorized to do so by law or a court order.[23]

         Aspen asserts that Mr. Bell communicated with Ms. Broadus about the subject of the representation, and Plaintiffs do not argue otherwise. With respect to whether Mr. Bell knew Ms. Broadus was represented by another lawyer in the matter, Aspen contends the issue is irrelevant because Ms. Broadus is a constituent of Aspen as described in Comment 7 to the rule. Comment 7 addresses communications with an organization, and it states as follows:

In the case of a represented organization, this Rule prohibits communications with a constituent of the organization who supervises, directs or regularly consults with the organization's lawyer concerning the matter or has authority to obligate the organization with respect to the matter or whose act or omission in connection with the matter may be imputed to the organization for purposes of civil or criminal liability. Consent of the organization's lawyer is not required for communication with a former constituent. If a constituent of the organization is represented in the matter by his or her own counsel, the consent by that counsel to a communication will be sufficient for purposes of this Rule. Compare Rule 3.4(f). In communicating with a current or former constituent of an organization, a lawyer must not use methods of obtaining evidence that violate the legal rights of the organization. See Rule 4.4.[24]

         September 2018 Telephone Calls

         Aspen asserts that Ms. Broadus is a constituent of Aspen who “has authority to obligate the organization with respect to the matter” and “whose act or omission in connection with the matter may be imputed to the organization for purposes of civil or criminal liability.” Aspen frames the issue as whether Plaintiffs' counsel knew on September 19 and 20, 2018 that Ms. Broadus was a constituent of Aspen with whom communications were prohibited, not whether Plaintiffs' counsel knew whether Ms. Broadus was represented by her own counsel. Plaintiffs addressed this issue at the hearing, noting that the Scheduling Conference was held on September 7, 2018.[25] Aspen's Rule 26(a)(1)(A) disclosures listed Margaret Mejia and Naftali Levenbrown as individuals likely to have discoverable information, along with unnamed representatives of three pest control and exterminating businesses.[26] The case record indicates the first discovery requests to a party were served on September 21, 2018, so no discovery responses had been produced as of September 19.[27] Plaintiffs submitted a copy of Aspen's answers to Plaintiffs' First Interrogatories served in October 2018, but neither do those answers mention Ms. Broadus.

         Aspen points to certain allegations in Plaintiffs' First Amended Complaint, statements by Plaintiff Riley in her deposition, and excerpts from Plaintiffs' expert report as evidence that Ms. Broadus's acts or omissions can be imputed to Aspen.[28] Of those items, only one-Plaintiffs' First Amended Complaint-is dated earlier than September 2018.

         Recalling that this case began when Central Park filed eviction actions against the original named Plaintiffs provides the context for allegations in the First Amended Complaint that the evictions were in retaliation for Plaintiff Ozburn's complaints about habitability and safety issues at the Complex, including bedbugs, cockroaches, mice, mold, and defective elevators.[29] The First Amended Petition does not include a claim for retaliatory eviction. Instead, in the factual allegations, Plaintiffs describe a tenant meeting Ms. Ozburn was conducting on November 30, 2017, during which Ms. Broadus allegedly interrupted, called her a derogatory name, and said she could and would have her evicted. The First Amended Complaint contends Ms. Ozburn received an eviction notice within an hour of Ms. Broadus's comments. But the First Amended Complaint contains no count for retaliatory eviction of Ms. Ozburn or any other Plaintiff.[30]

         In addition, the First Amended Complaint says nothing about Ms. Broadus's authority or responsibility to correct any of the habitability issues about which Plaintiffs complain. To the contrary, in a December 1, 2017 letter from Ms. Broadus to Ms. Ozburn that Aspen appends to its motion, Ms. Broadus offered housing resources because “[a]s the Social Service Coordinator for Central Park Towers, it has been brought to my attention that you may be in need of services.”[31] The Court therefore finds that the ...

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