# Peter R. Culpepper v. Baker, Donelson, Bearman, Caldwell & Berkowitz, P.C.

> Court of Appeals of Tennessee · October 16, 2020

URL: https://www.frixlaw.com/law-library/cases/4577934

## Case

- **Court:** Court of Appeals of Tennessee
- **Decided:** October 16, 2020
- **Precedential status:** Published
- **Opinion:** Opinion
- **Judges:** Judge Thomas R. Frierson, II
- **Cited by:** 0 later opinions in the Frix Law Library

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## Opinion text

10/16/2020
IN THE COURT OF APPEALS OF TENNESSEE
AT KNOXVILLE
July 23, 2020 Session

PETER R. CULPEPPER v. BAKER, DONELSON, BEARMAN,
CALDWELL & BERKOWITZ, P.C., ET AL.

Appeal from the Circuit Court for Knox County
No. 1-168-19 Kristi M. Davis, Judge
___________________________________

No. E2019-01932-COA-R3-CV
___________________________________

In this legal malpractice action, the trial court granted judgment on the pleadings in favor
of the defendants, determining that the plaintiff had waived any conflict of interest in his
signed engagement letter. The court also ruled that the plaintiff’s legal malpractice
claims were barred by the applicable statute of limitations. The plaintiff has appealed.
Upon our review of the pleadings and acceptance as true of all well-pleaded facts
contained in the plaintiff’s complaint and the reasonable inferences that may be drawn
therefrom, we determine that the plaintiff has pled sufficient facts in support of his claim
of legal malpractice. We therefore reverse the trial court’s grant of judgment on the
pleadings with regard to the plaintiff’s legal malpractice claim.1

Tenn. R. App. P. 3 Appeal as of Right; Judgment of the Circuit Court
Reversed in Part, Affirmed in Part; Case Remanded

THOMAS R. FRIERSON, II, J., delivered the opinion of the court, in which D. MICHAEL
SWINEY, C.J., and JOHN W. MCCLARTY, J., joined.

Peter R. Culpepper, Knoxville, Tennessee, Pro Se.

P. Edward Pratt, Knoxville, Tennessee, and Sam Berry Blair and Ryan A. Strain,
Memphis, Tennessee, for the appellees, Baker, Donelson, Bearman, Caldwell &
Berkowitz, P.C.; John S. Hicks; Tonya Mitchem Grindon; Martha L. Boyd; Samuel
Lanier Felker; Lori B. Metrock; and Lori H. Patterson.

1
The plaintiff asserted other claims that were also dismissed by virtue of the trial court’s grant of
judgment on the pleadings. We note that the plaintiff has not appealed the grant of judgment in favor of
the defendants with respect to those claims.
OPINION

I. Factual and Procedural Background

On May 9, 2019, the plaintiff, Peter R. Culpepper, filed a complaint in the Knox
County Circuit Court (“trial court”) against the following defendants: Baker, Donelson,
Bearman, Caldwell & Berkowitz, P.C. (“the Baker firm”); John S. Hicks; Tonya
Mitchem Grindon; Martha L. Boyd; Samuel Lanier Felker; Lori B. Metrock; and Lori H.
Patterson (collectively, “Defendants”). In his complaint, Mr. Culpepper alleged legal
malpractice arising out of Defendants’ simultaneous representation of Mr. Culpepper and
his former employer, Provectus Biopharmaceuticals, Inc. (“Provectus”).2 Mr. Culpepper
filed an amended complaint on May 31, 2019, wherein he alleged, inter alia, that
Defendants had represented him while also representing and advising Provectus to his
detriment and that Defendants had continued to represent Provectus to his detriment after
they withdrew from his representation.

In his amended complaint, Mr. Culpepper explained that he was employed as the
Chief Financial Officer for Provectus from 2004 until sometime in 2016 when he was
named interim Chief Executive Officer. Mr. Culpepper maintained that position with
Provectus until his employment termination effective December 28, 2016. According to
Mr. Culpepper, Defendants represented him concerning matters before the United States
Securities and Exchange Commission (“SEC”) on August 4, 2016, and August 11, 2016.
Mr. Culpepper alleged that on August 15, 2016, Defendants met with an independent
forensic accountant and discussed Mr. Culpepper “with respect to the SEC and other
attorney-client privileged and confidential matters WITHOUT his knowledge” (emphasis
in original).

Additionally, Mr. Culpepper alleged that Defendants discussed matters regarding
Mr. Culpepper and the SEC with Provectus’s Board of Directors in 2016, without Mr.
Culpepper’s knowledge, while simultaneously representing Mr. Culpepper. Mr.
Culpepper further averred, inter alia, that Defendants presented fabricated documentation
to support his ultimate termination for cause by Provectus in December 2016. Mr.
Culpepper claimed that Defendants had represented him and Provectus simultaneously
despite an obvious conflict of interest and had continued to represent Provectus following
termination of his representation on a substantially related matter. Additionally, Mr.
Culpepper claimed that Defendants had concealed documentation in support of his claims
until May 2018. Mr. Culpepper thus sought damages for legal malpractice, defamation,
and false light invasion of privacy; a declaratory judgment regarding the proper amount

2
Although Mr. Culpepper generally refers to the actions of “defendants,” most of the allegations in his
complaint are directed toward the Baker firm as a whole. The individually named defendants are
attorneys who were apparently employed by the Baker firm at the time of Mr. Culpepper’s representation.
-2-
owed by him to Provectus pursuant to their settlement agreement; and indemnification for
his attorney’s fees.

On July 3, 2019, Defendants filed a motion seeking leave to file their answer and
accompanying exhibits under seal. In their answer, Defendants denied any liability and
asserted various affirmative defenses, including expiration of the applicable statutes of
limitation and waiver. Defendants attached to their answer an engagement letter signed
by Mr. Culpepper on August 31, 2016. On August 13, 2019, Defendants filed a motion
for judgment on the pleadings, asserting, inter alia, that Mr. Culpepper had waived any
conflicts of interest in his August 31, 2016 engagement letter and had consented to
Defendants’ continued representation of Provectus, even if such representation was
ultimately adverse to Mr. Culpepper’s interests. Defendants also asserted that expiration
of the applicable one-year statute of limitations barred Mr. Culpepper’s malpractice
claims.

On September 30, 2019, the trial court entered an order granting judgment on the
pleadings in favor of Defendants and dismissing all of Mr. Culpepper’s claims. In its
order, the court stated in pertinent part:

The Court rules that in the August 31, 2016 engagement, waiver and
consent letter, [Mr. Culpepper] waived all conflicts of interest and
consented to Defendants’ representation of its other clients, including those
clients adverse to [Mr. Culpepper]. [Mr. Culpepper] specifically agreed
that he carefully read the foregoing letter and considered all the information
necessary and useful in determining whether or not to consent to the
representations outlined above. He was encouraged to consult with
independent counsel regarding this waiver and consent letter and
represented he was fully aware of his legal rights in this regard. The letter
also provides, “[u]pon reasoned reflection, I hereby voluntarily consent to
the representations by Baker Donelson as outlined above.” Therefore, the
Court rules [Mr. Culpepper] voluntarily waived all conflicts of interest,
which was the crux of the entire Amended Complaint.

Further, the Court also rules that the claims in the Amended
Complaint are barred by the statute of limitations.

Further, the Court rules that the libel, defamation, and invasion of
privacy claims were all determined adversely to [Mr. Culpepper] by the
Arbitrator and therefore these claims are estopped.

The trial court thereby dismissed all of Mr. Culpepper’s claims with prejudice. Mr.
Culpepper timely appealed.

-3-
II. Issues Presented

Mr. Culpepper presents the following issues for our review, which we have
restated slightly:

1. Whether the trial court erred by granting judgment in favor of
Defendants without allowing Mr. Culpepper to argue against a stay
of discovery when he was replying to Defendants’ motions.

2. Whether the trial court erred by granting judgment in favor of
Defendants when Mr. Culpepper purportedly had not knowingly and
voluntarily waived all conflicts of interest.

3. Whether the trial court erred by failing to apply the discovery rule to
toll the limitations period based on Defendants’ alleged fraudulent
concealment of their actions.

III. Standard of Review

Tennessee Rule of Civil Procedure 12.03 provides:

After the pleadings are closed but within such time as not to delay the trial,
any party may move for judgment on the pleadings. If, on a motion for
judgment on the pleadings, matters outside the pleadings are presented to
and not excluded by the court, the motion shall be treated as one for
summary judgment and disposed of as provided in Rule 56, and all parties
shall be given reasonable opportunity to present all material made pertinent
to such a motion by Rule 56.

In reviewing a trial court’s grant of judgment on the pleadings under Rule 12.03,
we are bound to regard as false all allegations of the moving party that are denied by the
non-moving party, and to accept all well-pleaded facts of the non-moving party, and the
reasonable inferences that may be drawn therefrom, as true. McClenahan v. Cooley, 806
S.W.2d 767, 769 (Tenn. 1991). “Conclusions of law are not admitted nor should
judgment on the pleadings be granted unless the moving party is clearly entitled to
judgment.” Id. In our review of this case, “all of the facts alleged by the Plaintiff in this
case must be taken as true and the issue then before us is whether upon those facts the
Plaintiff’s complaint states a cause of action that a jury should have been entitled to
decide.” Id. An appellate court “should uphold granting the [Rule 12.03] motion only
when it appears that the plaintiff can prove no set of facts in support of a claim that will
entitle him or her to relief.” Young v. Barrow, 130 S.W.3d 59, 63 (Tenn. Ct. App. 2003).
“A trial court’s legal conclusions regarding the adequacy of a complaint are reviewed de

-4-
novo without a presumption of correctness.” Stewart v. Schofield, 368 S.W.3d 457, 462-
63 (Tenn. 2012).

In reviewing pleadings, we “must give effect to the substance, rather than the form
or terminology of a pleading.” Id. at 463 (citing Abshure v. Methodist Healthcare-
Memphis Hosp., 325 S.W.3d 98, 104 (Tenn. 2010)). We respect Mr. Culpepper’s
decision to proceed without benefit of counsel and note that pleadings “prepared by pro
se litigants untrained in the law should be measured by less stringent standards than those
applied to pleadings prepared by lawyers.” Stewart, 368 S.W.3d at 462 (citing Carter v.
Bell, 279 S.W.3d 560 568 (Tenn. 2009); Hessmer v. Hessmer, 138 S.W.3d 901, 903
(Tenn. Ct. App. 2003); Young, 130 S.W.3d at 63). Although parties proceeding without
benefit of counsel are “entitled to fair and equal treatment by the courts,” we “must not
excuse pro se litigants from complying with the same substantive and procedural rules
that represented parties are expected to observe.” Hessmer v. Hessmer, 138 S.W.3d 901,
903 (Tenn. Ct. App. 2003).

IV. Motion for Protective Order

Mr. Culpepper asserts that the trial court erred by granting judgment on the
pleadings without considering the merits of Defendants’ motion seeking a protective
order, which Mr. Culpepper urges was filed “for the express purpose of avoiding [his]
discovery requests.” In his appellate brief, Mr. Culpepper proceeds to cite federal
precedent analyzing the proper standard for a court’s grant of a stay of discovery when a
party has filed or intends to file a case-dispositive motion. Defendants contend that Mr.
Culpepper’s arguments lack merit because (1) the trial court never granted Defendants’
motion seeking a protective order, finding it to be pretermitted due to the grant of
judgment on the pleadings and (2) Mr. Culpepper has provided an insufficient record to
permit review of this issue in any event. Based upon our thorough review of the record,
we agree with Defendants on both points.

The record before us contains neither Defendants’ motion seeking a protective
order nor any responsive pleadings filed by Mr. Culpepper. Defendants assert that there
were additional memoranda and other documents filed by the parties relative to this issue
that likewise were not included in the record. Moreover, no order disposing of
Defendants’ motion is contained in the record; instead, the trial court judge noted in her
oral ruling granting judgment on the pleadings that such action “pretermit[ted] . . . the
issue with respect to the motion for protective order . . . .”

Inasmuch as the trial court never ruled on the motion for protective order, there is
nothing for this Court to review. As a Court of appeals and errors, “we are limited in
authority to the adjudication of issues that are presented and decided in the trial courts.”
Dorrier v. Dark, 537 S.W.2d 888, 890 (Tenn. 1976). Furthermore, even if the trial court
had rendered a decision on this issue, “[t]his Court’s authority to review a trial court’s
-5-
decision is limited to those issues for which an adequate legal record has been
preserved.” Taylor v. Allstate Ins. Co., 158 S.W.3d 929, 931 (Tenn. Ct. App. 2004).

To the extent that Mr. Culpepper’s argument could be construed as advocating that
further discovery was required before the trial court considered a grant of judgment on
the pleadings, this Court has previously rejected such an argument. In Sakaan v. Fedex
Corp., Inc., No. W2016-00648-COA-R3-CV, 2016 WL 7396050, at *5 (Tenn. Ct. App.
Dec. 21, 2016), this Court explained:

A motion for judgment on the pleadings involves the consideration of
nothing other than what its title suggests; the motion requests that a court
grant judgment based on the pleadings alone. Accordingly, discovery is not
necessary to sharpen any factual issues, and the trial court’s resolution of
the motion is not dependent on anything other than the pleadings.

We therefore conclude that Mr. Culpepper’s first issue on appeal is without merit.

V. Waiver and Legal Malpractice Claims

Mr. Culpepper asserts that the trial court erred by granting judgment on the
pleadings in favor of Defendants with regard to Mr. Culpepper’s legal malpractice
claims, which were based on an alleged conflict of interest in Defendants’ representation
of Mr. Culpepper and Provectus. Mr. Culpepper postulates that (1) Defendants breached
Tennessee’s Rules of Professional Responsibility with regard to conflicts of interest and
(2) he did not and could not knowingly and voluntarily waive the conflicts. In response,
Defendants posit that the waiver contained in Mr. Culpepper’s engagement letter,
undisputedly executed by Mr. Culpepper, was a sufficient basis for the trial court’s
ruling.

As Mr. Culpepper points out, this Court has previously addressed the issue of
whether an alleged breach of a disciplinary rule equates to legal malpractice:

There is no doubt that the Code of Professional Responsibility (“the
Code”) does not set the standard for determining the civil liability of an
attorney. See Lazy Seven Coal Sales, Inc. v. Stone & Hinds, P.C., 813
S.W.2d 400 (Tenn. 1991). However, that fact does not preclude the
possibility that violation of the Code is relevant evidence in a subsequent
civil case. Id. at 405 (“[T]he standards stated in the Code are not irrelevant
in determining the standard of care in certain actions for malpractice”). The
Tennessee Supreme Court recognized that the Code may provide guidance
in defining a lawyer’s obligation to a client. Moreover, in some instances,
conduct which violates the Code may also be a breach of the attorney’s
standard of care. While violation of the Code, standing alone, will not
-6-
suffice to prove civil liability, it seems clear that such a violation may be
relevant evidence of a breach of the standard of care.

Roy v. Diamond, 16 S.W.3d 783, 790-91 (Tenn. Ct. App. 1999).

With regard to a claim of legal malpractice, this Court has previously elucidated:

To establish a prima facie cause of action for legal malpractice, the plaintiff
has the burden of proving each of the following elements: (1) a duty owed
by the lawyer; (2) breach of that duty; (3) damages suffered by the plaintiff;
(4) the attorney’s breach as the cause in fact of those damages; and (5) the
attorney’s breach as the proximate, or legal, cause of the plaintiff’s
damages. See Gibson v. Trant, 58 S.W.3d 103, 108 (Tenn. 2001). The
issues at the heart of this case, therefore, are whether [the attorney]
breached his duty to [the client] and if so, whether that breach caused [the
client] to suffer damages.

A plaintiff can show breach of the duty owed by an attorney by
demonstrating that “the attorney’s conduct fell below that degree of care,
skill, and diligence which is commonly possessed and exercised by
attorneys practicing in the same jurisdiction.” See Sanjines v. Ortwein and
Assocs., P.C., 984 S.W.2d 907, 910 (Tenn. 1998). Furthermore, with
reference to legal malpractice, a plaintiff has been determined to have
suffered damages or injury as the result of “the loss of a legal right, remedy
or interest, or the imposition of a liability.” See Parnell v. Ivy, 158 S.W.3d
924, 927 (Tenn. Ct. App. 2004) (quoting John Kohl & Co. P.C. v.
Dearborn & Ewing, 977 S.W.2d 528, 532 (Tenn. 1998)). “An actual injury
may also take the form of the plaintiff being forced to take some action or
otherwise suffer ‘some actual inconvenience,’ such as incurring an expense,
as a result of the defendant’s negligent or wrongful act.” John Kohl & Co.
P.C. v. Dearborn & Ewing, 977 S.W.2d 528, 532 (Tenn. 1998) (quoting
State v. McClellan, 113 Tenn. 616, 85 S.W. 267, 270 (1905)). This Court
has previously explained that “the mere possibility or probability of injury .
. . is not enough for a cause of action for legal malpractice to accrue.”
Caledonia Leasing & Equip. Co., Inc. v. Armstrong, Allen, Braden,
Goodman, McBride & Prewitt, 865 S.W.2d 10, 17 (Tenn. Ct. App. 1992).
“In order to prove damages in a legal malpractice action, a plaintiff must
prove that he would have obtained relief in the underlying lawsuit, but for
the attorney’s malpractice.” Shearon v. Seaman, 198 S.W.3d 209, 214
(Tenn. Ct. App. 2005). The plaintiff must also demonstrate a causal
connection between the attorney’s negligence and the plaintiff’s injury. See
Lazy Seven Coal Sales, Inc. v. Stone & Hinds, P.C., 813 S.W.2d 400, 407
(Tenn. 1991).
-7-
Jones v. Allman, 588 S.W.3d 649, 655-56 (Tenn. Ct. App. 2019), perm. app. denied
(Tenn. Sept. 19, 2019).

The trial court’s grant of judgment on the pleadings concerning Mr. Culpepper’s
legal malpractice claims was predicated in part on his waiver of any conflict of interest in
the signed engagement letter. Defendants attached this engagement letter to their answer
filed in this matter. As such, the engagement letter became a part of that pleading and
was properly considered by the trial court in its analysis of Defendants’ motion for
judgment on the pleadings.3 See Bartley v. Nunley, No. E2019-01694-COA-R3-CV,
2020 WL 5110302, at *7 (Tenn. Ct. App. Aug. 28, 2020).

The engagement letter provides as follows in pertinent part:

1. Scope of Representation.

You will be our client in this matter. We will be engaged to advise
you in connection with the SEC investigation entitled Provectus
Biopharmaceuticals, Inc. (“Provectus”) (H0-13000). Our acceptance of
this engagement (the “Matter”) does not involve representing you or your
interests in any other matter.

2. Fees and Expenses.

Provectus Biopharmaceuticals Company, Inc. (the “Company”) has
agreed to pay our fees and costs. We will, therefore, seek payment from
the Company.

3. Conflicts.

We are a large firm with offices in a number of cities in the United

3
Tennessee Rule of Civil Procedure 10.03 provides:

Whenever a claim or defense is founded upon a written instrument other than a
policy of insurance, a copy of such instrument or the pertinent parts thereof shall be
attached to the pleading as an exhibit unless the instrument is (1) a matter of public
record in the county in which the action is commenced and its location in the record is set
forth in the pleading; (2) in the possession of the adverse party and this fact is stated in
the pleading; (3) inaccessible to the pleader or is of such nature that attaching the
instrument would be unnecessary or impracticable and this fact is stated in the pleading,
together with the reason therefor. Every exhibit so attached or referred to under (1) and
(2) shall be a part of the pleading for all purposes.

(Emphasis added.)
-8-
States, and we represent many other companies and individuals. Given the
breadth of our practice, it is possible that during the time we are
representing you, some of our present or future clients will be engaged in
transactions, or encounter disputes, with you or the Company. You agree
that we may continue to represent, and may undertake in the future to
represent, existing or new clients in any matter that is not substantially
related to our work for you even if the interests of such clients in those
matters are directly adverse to you. At no time would we use or disclose
any confidential or proprietary information relating to our representation
of you in connection with our representation of another client without your
written consent, as appropriate. You should know that, in similar
engagement letters with many of our other clients, we have asked for
similar agreements to preserve our ability to represent you.

4. Joint Representation.

As you know, we are representing you jointly with the Company,
Timothy Scott and Eric Wachter. You have consented to this joint
representation. In a situation where our firm represents multiple clients
jointly in the same matter, we are free to share confidential information
communicated to us by one client with the other joint clients in the course
of and in furtherance of the joint representation. We would expect to share
information we receive from you with the Company, but we will not
necessarily share with you information that we receive from other clients,
and you will not be entitled to obtain any confidential information
provided to us by any other joint client either during the joint
representation or thereafter. Please contact me immediately if you have
any objections or concerns regarding this approach.

Based on the information we now have, we are not aware of any
actual and present conflicts of interest between you and either the
Company, Timothy Scott or Eric Wachter that would preclude this joint
representation. However, in any situation in which a lawyer represents
more than one client, there is the potential for the clients to have or to
develop conflicting interests. If you are aware or become aware of any
potential or actual conflict of interest with the Company, Timothy Scott or
Eric Wachter, please notify us promptly. Likewise, if we become aware
that a conflict has arisen or become apparent, we will notify you promptly.

If a conflict should arise between you and the Company, we will be
required to withdraw from representing you, and you may need to engage
another attorney to represent you. You agree that, should this occur, we
would be free to continue to represent the Company and other joint clients
-9-
(except in litigation directly adverse to you in this or a substantially related
matter) and that we and they may use any information we have obtained
during our representation of you, including any confidential information
you may provide to us. This may include sharing information you provide
to us with the Company and advising the Company with respect to any
issues raised by such information. In addition, if a conflict should arise
between you and the Company, Timothy Scott or Eric Wachter, we may be
required to withdraw from representing one or more of you, and you may
need to engage another attorney to represent you.

You also understand that we may be asked to represent other
individuals or entities who, by virtue of their current or former
employment with or other relationship to the Company, may seek our
advice in connection with these Matters, and you consent to such
representation on the same terms as set forth above. You agree to waive
any claim of conflict based on our past, current, and future representation
of the Company and its current or former officers, employees, directors,
etc. As noted above, our fees and costs for representing you in the Matter
will be paid by the Company, and you agree that you waive any claim of
conflict based upon our receipt of fees from the Company.

You should be aware that joint representation of multiple clients
may result in significant benefits for each client, but it may also result in
certain risks that might not arise if each client had his or its own separate
counsel. Possible benefits may include a common strategy, access to
privileged and other information held by other clients in the group, various
other tactical advantages, and shared legal fees and costs. There are also
potential risks. For example, as explained above, a conflict of interest
between or among clients could arise or become apparent, which may
require Baker Donelson to withdraw from representing one or more of the
joint clients. In addition, the Company has decided as a condition of this
joint representation, that confidential or privileged information disclosed
to Baker Donelson by individual clients will be shared with the Company
and that confidential or privileged information of the Company will not
necessarily be shared with individual clients, including yourself. The
Company may disclose, or direct us to disclose, to the SEC, or other
federal or state regulatory agencies or other third parties confidential or
privileged information provided by you and could decide to use such
information in a manner that could be disadvantageous to you. And,
although you will participate in decisions regarding our representation of
you, you will not be consulted on all decisions regarding our
representation of the Company or other joint clients in the Matter.

- 10 -
While the Company has agreed that Baker Donelson may represent
you in the Matter, you are of course free at any time to consult with any
other attorney, including with respect to whether you should enter into this
agreement, and to make different arrangements for your representation.

5. Conclusion of Representation.

Either of us may terminate the engagement at any time for any
reason by written notice, subject on our part to our professional obligations
to you under applicable rules of professional conduct and the terms and
conditions set forth in this agreement. Unless previously terminated, our
representation of you will terminate upon completion of the services for
the Matter described above in paragraph 1. It is understood and agreed
that in the event of any termination or withdrawal, we will be entitled to
receive any unpaid fees and expenses from the Company. Subsequent
invoices sent to collect expenses and/or unpaid balances, and/or
accounting records or client lists shall not extend the attorney-client
relationship. Unless you engage us after termination of this matter, we
will have no continuing obligation to advise you with respect to future
legal developments, such as changes in the applicable laws or regulations,
which could have an impact on your future rights and liabilities.

A provision at the conclusion of the engagement letter states as follows:

I have carefully read the foregoing letter, considered all information
necessary and useful in determining whether or not to consent to the
representations outlined above. I have been encouraged to consult with
independent counsel regarding this consent to representation, and I am fully
aware of my legal rights in this regard. Upon reasoned reflection, I hereby
voluntarily consent to the representations by Baker Donelson as outlined
above.

Mr. Culpepper’s signature appears thereon, dated August 31, 2016. Mr. Culpepper does
not dispute that he signed the engagement letter, although he asserts in his brief that he
does not specifically remember doing so.

The parties agree that Tennessee Supreme Court Rule 8, Rule of Professional
Conduct 1.7 (“RPC 1.7”), applies in this situation. RPC 1.7 states in pertinent part:

(a) Except as provided in paragraph (b), a lawyer shall not represent a
client if the representation involves a concurrent conflict of interest.
A concurrent conflict of interest exists if:

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(1) the representation of one client will be directly adverse
to another client; or

(2) there is a significant risk that the representation of one
or more clients will be materially limited by the
lawyer’s responsibilities to another client, a former
client or a third person or by a personal interest of the
lawyer.

(b) Notwithstanding the existence of a concurrent conflict of interest
under paragraph (a), a lawyer may represent a client if:

(1) the lawyer reasonably believes that the lawyer will be
able to provide competent and diligent representation
to each affected client;

(2) the representation is not prohibited by law;

(3) the representation does not involve the assertion of a
claim by one client against another client represented
by the lawyer in the same litigation or other
proceeding before a tribunal; and

(4) each affected client gives informed consent, confirmed
in writing.

Mr. Culpepper has not disputed that Defendants terminated their representation of
him in December 2016. Because Defendants allegedly continued their representation of
Provectus following termination of their representation of Mr. Culpepper in 2016, the
parties are in accord that Tennessee Supreme Court Rule 8, Rule of Professional Conduct
1.9 (“RPC 1.9”) would also apply in this situation. RPC 1.9 states as follows:

a) A lawyer who has formerly represented a client in a matter shall not
thereafter represent another person in the same or a substantially
related matter in which that person’s interests are materially adverse
to the interests of the former client unless the former client gives
informed consent, confirmed in writing.4

4
Comment 3 to RPC 1.9 provides that matters are “substantially related” if they “involve the same
transaction or legal dispute or other work the lawyer performed for the former client” or “if there is a
substantial risk that confidential factual information that would normally have been obtained in the prior
representation would materially advance the client’s position in the subsequent matter, unless that
information has become generally known.”
- 12 -
(b) Unless the former client gives informed consent, confirmed in
writing, a lawyer shall not knowingly represent a person in the same
or a substantially related matter in which a firm with which the
lawyer formerly was associated had previously represented a client

(1) whose interests are materially adverse to that person;
and

(2) about whom the lawyer had acquired information
protected by RPCs 1.6 and 1.9(c) that is material to the
matter.

(c) A lawyer who has formerly represented a client in a matter or whose
present or former firm has formerly represented a client in a matter
shall not thereafter reveal information relating to the representation
or use such information to the disadvantage of the former client
unless (1) the former client gives informed consent, confirmed in
writing, or (2) these Rules would permit or require the lawyer to do
so with respect to a client, or (3) the information has become
generally known.

Defendants do not dispute that a conflict of interest arose between Provectus and
Mr. Culpepper at some point; in fact, the existence of such a conflict was the reason
provided by Defendants for terminating their representation of Mr. Culpepper in
December 2016. Defendants assert, however, that Mr. Culpepper waived all conflicts of
interest with other clients of the Baker firm and gave informed consent to Defendants’
continued representation of Provectus in the event such a conflict arose. Although we
agree with Defendants that Mr. Culpepper acknowledged his voluntary agreement to the
waiver contained in the engagement letter, such acknowledgement is not determinative of
the issue of whether Mr. Culpepper’s consent was informed.

“Informed consent” is defined in the Rules of Professional Conduct as “the
agreement by a person to a proposed course of conduct after the lawyer has
communicated adequate information and explanation about the material risks of and
reasonably available alternatives to the proposed course of conduct.” Tenn. Sup. Ct. R. 8,
RPC 1.0. As our Supreme Court has explained:

[O]ur rules permit a waiver of a conflict of interest if “(1) the lawyer
reasonably believes the representation will not be adversely affected; and
(2) the client consents in writing after consultation.” Tenn. Sup. Ct. R. 8,
RPC 1.7(b). In order to waive a conflict of interest, the petitioner must
demonstrate that he fully understands the nature of the conflict and its
effect; that he understands his right to the appointment of other counsel if
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necessary; and that, notwithstanding the potential ill effects of continued
representation by counsel of record, he desires to proceed. A valid waiver
must, of course, not only be made knowingly, but also be made fully and
voluntarily in the context of the case.

Frazier v. State, 303 S.W.3d 674, 683-84 (Tenn. 2010) (other internal citations omitted).

Although there is a dearth of case law interpreting the Rules of Professional
Conduct in relation to the factual scenario presented in this matter, we note that the
comments to RPC 1.7 are instructive to our analysis. For example, comment 6 to RPC
1.7 states: “Loyalty to a current client prohibits undertaking representation directly
adverse to that client without that client’s informed consent. Thus, absent consent, a
lawyer may not act as an advocate in one matter against a person the lawyer represents in
some other matter, even when the matters are wholly unrelated.” As such, it is clear that
a client can provide informed consent in order to enable an attorney to undertake
concurrent representation that is adverse to that client in certain circumstances. However,
when such consent is given, “the information provided [to the client] must include the
implications of the common representation, including possible effects on loyalty,
confidentiality and the attorney-client privilege and the advantages and risks involved.”
See RPC 1.7, cmt. 18.

In the case at bar, Mr. Culpepper executed an acknowledgement stating that he
had “carefully read” the engagement letter and had “considered all information necessary
and useful in determining whether or not to consent to the representations” stated therein.
Mr. Culpepper further acknowledged that he had been encouraged to consult with
independent counsel regarding his consent to representation. Mr. Culpepper affirmed
that he had, upon “reasoned reflection,” “voluntarily consent[ed] to the representations by
Baker Donelson as outlined above.”

The question that remains unanswered, however, is whether Mr. Culpepper was
provided information concerning “the implications of the common representation,
including possible effects on loyalty, confidentiality and the attorney-client privilege” or
“the potential ill effects of continued representation by counsel of record” such that he
could “fully understand[] the nature of the conflict and its effect.” See Frazier, 303
S.W.3d at 683-84; RPC 1.7, cmt. 18.

Mr. Culpepper posits that his consent was not “informed” in that he was not
afforded sufficient information concerning the nature and extent of the conflict and its
effect on his individual representation. We note that according to the engagement letter,
although Mr. Culpepper expressly agreed that the Baker firm “would expect to share
information [the Baker firm] receive[d] from [Mr. Culpepper] with [Provectus],” he also
agreed that the Baker firm would not necessarily share information received from

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Provectus with Mr. Culpepper. In addition, we note again that the engagement letter
expressly provides:

If a conflict should arise between you and the Company, we will be
required to withdraw from representing you, and you may need to engage
another attorney to represent you. You agree that, should this occur, we
would be free to continue to represent the Company and other joint clients
(except in litigation directly adverse to you in this or a substantially related
matter) and that we and they may use any information we have obtained
during our representation of you, including any confidential information
you may provide to us. This may include sharing information you provide
to us with the Company and advising the Company with respect to any
issues raised by such information. . . .

You agree to waive any claim of conflict based on our past, current, and
future representation of the Company and its current or former officers,
employees, directors, etc. As noted above, our fees and costs for
representing you in the Matter will be paid by the Company, and you agree
that you waive any claim of conflict based upon our receipt of fees from the
Company.

The letter further explained that although there were benefits to joint
representation, there were also risks, such as “that confidential or privileged information
disclosed to Baker Donelson by individual clients will be shared with the Company and
that confidential or privileged information of the Company will not necessarily be shared
with individual clients, including yourself.” In addition, the letter provided that
Provectus “may disclose, or direct us to disclose, to the SEC, or other federal or state
regulatory agencies or other third parties confidential or privileged information provided
by you and could decide to use such information in a manner that could be
disadvantageous to you.” Moreover, the letter clarified that Mr. Culpepper would “not be
consulted on all decisions regarding our representation of the Company or other joint
clients in the Matter.”

Despite the aforementioned language, the letter also included that “[b]ased on the
information we now have, we are not aware of any actual and present conflicts of interest
between you and either the Company, Timothy Scott or Eric Wachter that would preclude
this joint representation.” The letter further provided that “if we become aware that a
conflict has arisen or become apparent, we will notify you promptly.” However,
according to the factual allegations contained in Mr. Culpepper’s amended complaint,
Defendants had met with a forensic accountant and discussed issues concerning Mr.
Culpepper on August 15, 2016, without Mr. Culpepper’s knowledge. This meeting
occurred before Mr. Culpepper signed the conflict waiver on August 31, 2016. Mr.
Culpepper alleged in his amended complaint that this meeting with the forensic
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accountant ultimately resulted in the fabrication of documentation to support Mr.
Culpepper’s termination from Provectus for cause. Mr. Culpepper further alleged that he
was never made aware of the meeting until documents were disclosed in May 2018. We
note that Defendants did not withdraw from their representation of Mr. Culpepper until
after his termination from Provectus in December 2016.

Accepting these allegations as true, as we must when reviewing a grant of
judgment on the pleadings, we conclude that Mr. Culpepper’s complaint stated sufficient
facts to support his claim. We reiterate that this Court “should uphold granting the [Rule
12.03] motion only when it appears that the plaintiff can prove no set of facts in support
of a claim that will entitle him or her to relief.” Young, 130 S.W.3d at 63. Mr. Culpepper
effectively alleged that Defendants engaged to represent him and continued that
representation despite dealing simultaneously with Provectus and third parties to his
detriment, thus establishing a potential violation of RPC 1.7. Mr. Culpepper further
alleged that Defendants continued to represent Provectus on a substantially related matter
after they withdrew from representing him and that Provectus’s interests were materially
adverse to his interests as a former client, thus establishing a potential violation of RPC
1.9. Such violations of the Rules of Professional Conduct can be evidence of a breach of
the standard of care, see Roy, 16 S.W.3d at 790-91, and Mr. Culpepper claimed that he
was damaged by wrongful termination from his employment and other monetary losses
as a result of Defendant’s breach of duty. We therefore conclude that Mr. Culpepper
properly stated a claim for legal malpractice in his amended complaint. See Jones, 588
S.W.3d at 655-56.

Moreover, Mr. Culpepper argues that even if it could be shown that he provided
informed consent to the conflict in this matter, not all conflicts are waivable. We agree,
observing that comment 15 to RPC 1.7 provides: “Consentability is typically determined
by considering whether the interests of the clients will be adequately protected if the
clients are permitted to give their informed consent to representation burdened by a
conflict of interest.” Representation of a client “is prohibited if, in the circumstances, the
lawyer cannot reasonably conclude that the lawyer will be able to provide competent and
diligent representation.” Id. Analysis of this issue requires further factual determination
that is inappropriate for judgment on the pleadings.

For the foregoing reasons, we conclude that the trial court improperly granted
judgment on the pleadings to Defendants concerning Mr. Culpepper’s claim of legal
malpractice. We therefore reverse the trial court’s grant of judgment on the pleadings to
Defendants regarding this issue.

VI. Statute of Limitations

Mr. Culpepper has also raised an issue concerning the trial court’s alternative
ruling that Mr. Culpepper’s legal malpractice claims were barred by the applicable one-
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year statute of limitations. Mr. Culpepper contends that the trial court erred by failing to
apply the discovery rule to toll the statute of limitations based on Defendants’ fraudulent
concealment of their August 2016 meeting with the forensic accountant, which occurred
without Mr. Culpepper’s knowledge and to his detriment.

Our Supreme Court summarized Tennessee’s discovery rule applicable to legal
malpractice claims in John Kohl & Co. P.C. v. Dearborn & Ewing, 977 S.W.2d 528, 532-
33 (Tenn. 1998):

When the cause of action accrues is determined by applying the discovery
rule. Under this rule, a cause of action accrues when the plaintiff knows or
in the exercise of reasonable care and diligence should know that an injury
has been sustained as a result of wrongful or tortious conduct by the
defendant.

In legal malpractice cases, the discovery rule is composed of two
distinct elements: (1) the plaintiff must suffer legally cognizable damage—
an actual injury—as a result of the defendant’s wrongful or negligent
conduct, and (2) the plaintiff must have known or in the exercise of
reasonable diligence should have known that this injury was caused by the
defendant’s wrongful or negligent conduct. An actual injury occurs when
there is the loss of a legal right, remedy or interest, or the imposition of a
liability. An actual injury may also take the form of the plaintiff being
forced to take some action or otherwise suffer “some actual
inconvenience,” such as incurring an expense, as a result of the defendant’s
negligent or wrongful act. However, the injury element is not met if it is
contingent upon a third party’s actions or amounts to a mere possibility.

The knowledge component of the discovery rule may be established
by evidence of actual or constructive knowledge of the injury.
Accordingly, the statute of limitations begins to run when the plaintiff has
actual knowledge of the injury as where, for example, the defendant admits
to having committed malpractice or the plaintiff is informed by another
attorney of the malpractice. Under the theory of constructive knowledge,
however, the statute may begin to run at an earlier date—whenever the
plaintiff becomes aware or reasonably should have become aware of facts
sufficient to put a reasonable person on notice that an injury has been
sustained as a result of the defendant’s negligent or wrongful conduct. We
have stressed, however, that there is no requirement that the plaintiff
actually know the specific type of legal claim he or she has, or that the
injury constituted a breach of the appropriate legal standard. Rather, “the
plaintiff is deemed to have discovered the right of action if he is aware of
facts sufficient to put a reasonable person on notice that he has suffered an
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injury as a result of wrongful conduct.” Carvell [v. Bottoms], 900 S.W.2d
[23,] 29 [(Tenn. 1995)] (quoting Roe v. Jefferson, 875 S.W.2d 653, 657
(Tenn. 1994)). “It is knowledge of facts sufficient to put a plaintiff on
notice that an injury has been sustained which is crucial.” Stanbury [v.
Bacardi], 953 S.W.2d [671,] 678 [(Tenn. 1997)]. A plaintiff may not, of
course, delay filing suit until all the injurious effects or consequences of the
alleged wrong are actually known to the plaintiff. Allowing suit to be filed
once all the injurious effects and consequences are known would defeat the
rationale for the existence of statutes of limitations, which is to avoid the
uncertainties and burdens inherent in pursuing and defending stale claims.

(Other internal citations omitted.)

In the instant case, Mr. Culpepper stated in his amended complaint that he was
unaware of Baker Donelson’s meeting with the forensic accountant, which he alleged
resulted in the disclosure of privileged communications and, ultimately, the fabrication of
documents to justify his termination for cause from Provectus, until documents were
disclosed in May 12, 2018 revealing these facts. Mr. Culpepper further alleged that the
Baker firm “fraudulently concealed the notes of any meetings it had with [the forensic
accountant] about [Mr. Culpepper] until [the forensic accountant] revealed the notes” and
that he was not made aware of Defendants’ meeting with the forensic accountant until
May 12, 2018. Mr. Culpepper has alleged that he therefore could not have and did not
discover “facts sufficient to put a reasonable person on notice that he ha[d] suffered an
injury as a result of wrongful conduct” until that time. See John Kohl & Co., 977 S.W.2d
at 533 (quoting Carvell v. Bottoms, 900 S.W.2d 23, 29 (Tenn. 1995)). Mr. Culpepper
filed his original complaint on May 9, 2019, which was within one year of the date he
claimed to have discovered such facts.

Defendants counter in their appellate brief that Mr. Culpepper knew that he had
been terminated in December 2016 and knew that Defendants had continued to represent
Provectus in a manner adverse to Mr. Culpepper in 2017 and early 2018. However, these
facts do not necessarily establish that Mr. Culpepper was on notice that he had been
injured by conduct attributable to Defendants at that time. Defendants further assert that
Mr. Culpepper made statements during his March 15, 2018 deposition, taken in the
course of arbitration proceedings, accusing Defendants of much of the same conduct
alleged in the amended complaint. We note, however, that the trial court neither referred
to nor appeared to consider Mr. Culpepper’s deposition when granting judgment on the
pleadings, which was proper inasmuch as Rule 12.03 directs that the court cannot
consider “matters outside the pleadings” when ruling on such motion. See Bartley, 2020
WL 5110302, at *8 (“[I]f the trial court had considered [a potential witness’s] deposition
transcript or his notes, the effect would have been to convert Plaintiffs’ motion for a
judgment on the pleadings to a motion for summary judgment.”). We are likewise bound
to consideration of the pleadings alone on appeal. See Local TV Tenn. LLC v. N.Y.S.E.
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Wolfchase LLC, No. W2017-00675-COA-R3-CV, 2018 WL 1721866, at *4 (Tenn. Ct.
App. Apr. 9, 2018).

Based solely on the facts alleged in Mr. Culpepper’s amended complaint, which
must be taken as true, we determine that the trial court erred in granting judgment in
favor of Defendants with regard to Mr. Culpepper’s legal malpractice claim predicated
upon the statute of limitations and in failing to determine that the discovery rule could be
applied. We therefore reverse this portion of the trial court’s judgment as well.

VII. Conclusion

For the foregoing reasons, we reverse the trial court’s grant of judgment on the
pleadings in favor of Defendants with regard to Mr. Culpepper’s legal malpractice claim.
The balance of the trial court’s judgment, which was not appealed, remains in effect.
Costs on appeal are assessed to the appellees, Baker, Donelson, Bearman, Caldwell &
Berkowitz, P.C.; John S. Hicks; Tonya Mitchem Grindon; Martha L. Boyd; Samuel
Lanier Felker; Lori B. Metrock; and Lori H. Patterson. This case is remanded to the trial
court for further proceedings consistent with this opinion and collection of costs assessed
below.

_________________________________
THOMAS R. FRIERSON, II, JUDGE

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Source: Frix Law Library, https://www.frixlaw.com/law-library/cases/4577934. Public record. Not legal advice.