The opinion
IN THE UNITED STATES DISTRICT COURT
FOR THE SOUTHERN DISTRICT OF OHIO
WESTERN DIVISION (DAYTON)
SHEETZ, INC., et al., : Case No. 3:24-cv-00059
:
Plaintiffs, : District Judge Michael J. Newman
: Magistrate Judge Caroline H. Gentry
vs. :
:
CITY OF CENTERVILLE, et al.,
:
Defendants. :
:
OPINION AND ORDER
This action arises from a real estate contract entered into by Plaintiffs. Asserting
that certain Defendants tortiously interfered with their contractual relationship, and that
other Defendants unlawfully denied approval of Plaintiffs’ site plan, Plaintiffs filed this
action in the Montgomery County Common Pleas Court. Defendants removed the action
to this Court on the basis of federal question jurisdiction.
This matter is now before the Court upon Plaintiffs’ Motion to Disqualify Mark
Chilson as Counsel of Record for Defendant Epiphany Evangelical Lutheran Church
(“Motion to Disqualify,” Doc. No. 13). For the reasons set forth below, Plaintiffs’ Motion
to Disqualify is GRANTED.
I. STATEMENT OF FACTS
The following statement of facts is taken from the allegations set forth in
Plaintiffs’ Complaint (Doc. No. 1-1, PageID 6-54), the Answer and Counterclaim of
Defendant Epiphany Evangelical Lutheran Church (Doc. No. 35, PageID 560-89), and
the Answer of Defendant Graceworks Lutheran Services d/b/a Bethany Lutheran Village
(Doc. No. 36, PageID 590-99). At this stage of the litigation, the Court makes no findings
regarding the accuracy of the parties’ allegations.
This lawsuit arises from a dispute over property located at 6318 Far Hills Avenue
(the “Property”), which formerly housed a restaurant (“Elsa’s South”). Defendant
Epiphany Evangelical Lutheran Church (“Epiphany”) operates a church and preschool on
land adjacent to the Property. Defendant Graceworks Lutheran Services d/b/a Bethany
Lutheran Village (“Bethany Village”) operates a residential senior retirement community
on land across the street from the Property. Attorney Mark Chilson is a board member of
Bethany Village, and also acted as legal counsel for Epiphany both before and during this
lawsuit. (Doc. No. 1-1, ⁋⁋ 3, 6-7 & 37-38, PageID 7-8 & 11.)
Together with other investors, William Hemmert opened Elsa’s South on the
Property in 1981. Epiphany, through its entity ELC-SV, LLC, purchased the Property in
1999. From 1999 to 2017, Epiphany leased the Property to Elsa’s South. During that
time, Epiphany benefitted from the sale, distribution, and consumption of alcohol on the
Property. (Doc. No. 1-1, ⁋⁋ 11-12 & 14-17, PageID 8-9.)
In 2017, William Hemmert formed Hemmert Far Hills Properties LLC (“Hemmert
Far Hills”) and bought the Property from Epiphany. After a family tragedy in 2020, Mr.
Hemmert eventually decided to sell Elsa’s South. (Doc. No. 1-1, ⁋⁋ 18-21, PageID 9.)
In the summer of 2022, Hemmert Far Hills entered into a real estate contract in
which it agreed to sell the Property to Plaintiff Sheetz, Inc. (“Sheetz”), which operates
convenience stores, and Plaintiff Morse Road Development d/b/a Skilken Gold (“Skilken
Gold”). The Sheetz purchase became public in December 2022. Plaintiffs allege that
“[o]nce it was learned that there was a contract to build a Sheetz at the [Property],
Epiphany and Bethany Village began to orchestrate a plan to see that the Sheetz would
not be built.” (Doc. No. 1-1, ⁋⁋ 1-2 & 22-26, PageID 7 & 9-10.)
It is undisputed that on April 20, 2023, William Hemmert and his son, Jason
Hemmert, discussed the Sheetz contract with attorneys Thomas Intilli and Mark Chilson.
What happened during that meeting is, however, disputed.
Plaintiffs allege that William and Jason Hemmert agreed to meet with a local
attorney, who is a close friend, to discuss the Sheetz deal. Unbeknownst to them, that
attorney invited Attorney Chilson to attend the meeting. Attorney Chilson informed the
Hemmerts that he was a representative of Epiphany and Bethany Village, and was legal
counsel for Epiphany. Attorney Chilson stated that neither Epiphany nor Bethany Village
wanted to have a Sheetz located on the Property. Attorney Chilson indicated that
Epiphany and Bethany Village had a three-way business plan in mind with a third entity
for the Property. He stated that Epiphany, Bethany Village, and the third entity would pay
the Hemmerts a higher price than Sheetz had agreed to pay for the Property. On behalf of
Epiphany and Bethany Village, Attorney Chilson asked the Hemmerts to “kill the deal”
with Skilken Gold and Sheetz. He said that the Sheetz purchase would not go through and
that the Centerville City Council would not allow a Sheetz to be built on the Property.
Jason Hemmert told Attorney Chilson that he should not be talking with them, and that
Hemmert Far Hills would not try to kill the deal. The meeting ended amicably. (Doc. No.
1-1, ⁋⁋ 31-46, PageID 10-12.)
Epiphany admits that Attorney Chilson attended the April 20, 2023 meeting and
spoke on its behalf. Epiphany further admits that Attorney Chilson provides legal
services to the church. With respect to Plaintiffs’ allegations about what Attorney Chilson
said during the meeting, Epiphany states that it “is without sufficient information to admit
or deny the . . . allegations . . . and, therefore, denies same.” (Doc. No. 35, ⁋⁋ 31-46,
PageID 564-65.) Notably, however, although his co-counsel signed the Answer, Attorney
Chilson is listed as Trial Counsel in the Answer’s signature block. (Id. at PageID at 581.)
For its part, Bethany Village admits that Attorney Chilson is a board member.
However, Bethany Village denies that Attorney Chilson attended the April 20, 2023
meeting either on its behalf or as its agent. With respect to Plaintiffs’ allegations about
what Attorney Chilson said during the meeting, Bethany Village similarly states that it is
without information sufficient to form a belief as to the truth of those allegations, and
therefore denies them. (Doc. No. 36, ⁋⁋ 14-19, PageID 592.)
Ultimately, the Centerville City Council reversed the decision of the Centerville
Planning Commission to approve construction of the proposed gas station. Plaintiffs
subsequently filed this action against Defendants Epiphany, Bethany Village, City of
Centerville and Centerville City Council. (Complaint, Doc. No. 1-1.) Significantly,
Plaintiffs base several of their claims, in part, upon Mr. Chilson’s alleged statements
during the April 20, 2023 meeting.
In Count One, Plaintiffs have sued Epiphany and Bethany Village for tortious
interference with business relations. Plaintiffs allege, among other things, that “Bethany
Village (by and through its agent, Mr. Chilson, among others) and Epiphany (by and
through its agent, Mr. Chilson, among others) acted with the intent to interfere with
Sheetz, Skilken Gold and Hemmert Far Hills’ business relations.” (Doc. No. 1-1, ⁋⁋ 71-
79, PageID 15.)
In Count Two, Plaintiffs have sued Epiphany and Bethany Village for tortious
interference with contractual relations. Plaintiffs allege, among other things, that
“Bethany Village (by and through its agent, Mr. Chilson, among others) and Epiphany
(by and through its agent, Mr. Chilson, among others) acted with the intent to procure the
contract’s breach.” (Doc. No. 1-1, ⁋⁋ 80-88, PageID 15-16.)
In Count Five, Plaintiffs have sued Defendants Epiphany and Bethany Village for
civil conspiracy. Plaintiffs allege, among other things, that “Bethany Village (by and
through its agent, Mr. Chilson, among others) and Epiphany (by and through its agent,
Mr. Chilson, among others) acted in malicious combination to cause injury to Plaintiffs.”
(Doc. No. 1-1, ⁋⁋ 108-112, PageID 18.)
II. LAW AND ANALYSIS
A. Applicable Legal Standard
“Motions to disqualify are viewed with disfavor[,] and disqualification is
considered a drastic measure which courts should hesitate to impose except when
absolutely necessary.” Kirsch v. Dean, No. 17-05650, 2017 U.S. App. LEXIS 21257, at
*4 (6th Cir. Oct. 25, 2017) (internal citation omitted). However, district courts have
“‘substantial latitude’ to disqualify counsel when ‘a potential conflict exists which may or
may not burgeon into an actual conflict as the trial progresses.’” Kennedy v. Stewart, 567
F. App’x 433, 435 (6th Cir. 2014) (quoting Wheat v. U.S., 486 U.S. 153, 158 (1988)).
B. Attorney Chilson Should Be Disqualified As Counsel For Defendant
Epiphany Under Rule 3.7(a) of the Ohio Rules of Professional Conduct
Plaintiffs seek to disqualify Attorney Chilson under Rule 3.7(a) of the Ohio Rules
of Professional Conduct, which this Court has adopted. See S.D. Ohio Model Fed. R.
Disciplinary Enf’t IV. That disciplinary rule provides:
(a) A lawyer shall not act as an advocate at a trial in which the lawyer is
likely to be a necessary witness unless one or more of the following
applies:
(1) the testimony relates to an uncontested issue;
(2) the testimony relates to the nature and value of legal services
rendered in the case;
(3) the disqualification of the lawyer would work substantial
hardship on the client.
Ohio Rule Prof. Conduct 3.7(a) (emphasis in original). The Comment to Rule 3.7(a)
explains the rationale for this prohibition:
[1] Combining the roles of advocate and witness can prejudice the tribunal
and the opposing party . . . .
[2] The tribunal has proper objection when the trier of fact may be
confused or misled by a lawyer serving as both advocate and witness.
The opposing party has proper objection where the combination of
roles may prejudice that party’s rights in the litigation. A witness is
required to testify on the basis of personal knowledge, while an
advocate is expected to explain and comment on evidence given by
others. It may not be clear whether a statement by an advocate-witness
should be taken as proof or as an analysis of the proof.
[3] To protect the tribunal, division (a) prohibits a lawyer from
simultaneously serving as counsel and necessary witness except in
those circumstances specified in divisions (a)(1) to (3). . . .
[4] . . . [D]ivision (a)(3) recognizes that a balancing is required between
the interests of the client and those of the tribunal and the opposing
party. Whether the tribunal is likely to be misled or the opposing
party is likely to suffer prejudice depends on the nature of the case,
the importance and probable tenor of the lawyer’s testimony, and the
probability that the lawyer’s testimony will conflict with that of other
witnesses. Even if there is risk of such prejudice, in determining
whether the lawyer should be disqualified, due regard must be given to
the effect of disqualification on the lawyer’s client.
Comment to Ohio Rule Prof. Conduct 3.7(a) (emphasis added).
Attorney Chilson argues that he is not likely to be a necessary witness regarding
his statements and conduct during the April 20, 2023 meeting. The Court disagrees.
Three of Plaintiffs’ legal claims are based, in part, upon Attorney Chilson’s actions
during that meeting. According to Plaintiffs, Attorney Chilson told the Hemmerts that he
was acting on behalf of Defendants Epiphany and Bethany Village when he intentionally
attempted to persuade them to breach their contract with Sheetz and Skilken Gold.
Although Attorney Chilson argues that another meeting participant (namely, Mr. Intilli)
could testify about what occurred, Mr. Intilli lacks the personal knowledge to testify
about Attorney Chilson’s intentions. Mr. Intilli also lacks the personal knowledge to
testify about whether Attorney Chilson was acting on behalf of Bethany Village during
the meeting, a fact that Plaintiffs allege is true but Bethany Village denies.
The Court also finds that Attorney Chilson’s likely testimony at trial will relate to
contested issues. Plaintiffs rely heavily on Attorney Chilson’s alleged statements to
support their tort claims against Epiphany and Bethany. Epiphany, which is Attorney
Chilson’s client in this litigation, has perplexingly responded that it cannot admit or deny
Plaintiff’s allegations about the substance of Attorney Chilson’s statements because it
lacks the knowledge necessary to admit or deny the truth of those allegations. Bethany
Village similarly claims not to know what Attorney Chilson said during the meeting,
although it denies that Attorney Chilson was acting on its behalf. Whether, and to what
extent, Attorney Chilson will dispute Plaintiff’s allegations is unknown at this time. But it
appears to be a near certainty that these factual issues will be vigorously contested at trial.
The Court further finds that the disqualification of Attorney Chilson will not work
a substantial hardship on his client. Epiphany is also represented in this litigation by three
attorneys from Bricker Graydon LLP, which is a reputable and well-known law firm.
There is no basis for concluding that disqualifying one of Epiphany’s four attorneys will
work a substantial hardship upon it in this litigation.
Finally, the Court finds that disqualification is necessary to comply with the
purpose of Rule 3.7(a), which is to avoid prejudice to the tribunal and opposing party
under the advocate-witness rule. See Comment to Ohio R. Prof. Conduct 3.7(a). Given
the central importance of Attorney Chilson’s testimony about his own statements and
conduct during the April 20, 2023 meeting, as well as the probability that his testimony
will conflict with the testimony of other witnesses, it is necessary to disqualify him from
representing Epiphany in this litigation under Rule 3.7(a).1
III. CONCLUSION
For the reasons stated, Plaintiffs’ Motion to Disqualify (Doc. No. 13) is
GRANTED. Attorney Chilson is DISQUALIFIED as counsel for Defendant Epiphany
and shall immediately cease to act as its attorney in this matter.
1 Given the Court’s conclusion about the applicability of Rule 3.7(a), it need not and does not reach the related but
separate issue of whether disqualification is required by the common-law unsworn witness rule. See Doc. No. 31
(requesting briefing on that issue).
IT IS SO ORDERED.
/s/ Caroline H. Gentry
Caroline H. Gentry
United States Magistrate Judge
Notice of Procedure on Objections
Pursuant to Fed. R. Civ. P. 72(a), any party may serve and file specific, written
objections within FOURTEEN days after being served with this Order. Pursuant to Fed.
R. Civ. P. 6(d), this period is extended to SEVENTEEN days if this Order is being
served by one of the methods of service listed in Fed. R. Civ. P. 5(b)(2)(C), (D), or (F).
Such objections shall specify the portions of the Order objected to and shall be
accompanied by a memorandum of law in support of the objections. If the Order is based
in whole or in part upon matters occurring of record at an oral hearing, the objecting
party shall promptly arrange for the transcription of the record, or such portions of it as
all parties may agree upon or the Magistrate Judge deems sufficient, unless the assigned
District Judge otherwise directs. A party may respond to another party’s objections
within FOURTEEN days after being served with a copy thereof.
Failure to make objections in accordance with this procedure may forfeit rights on
appeal. See Thomas v. Arn, 474 U.S. 140 (1985); United States v. Walters, 638 F.2d 947,
949-50 (6th Cir. 1981).