Opposition Brief — Cochrane & Bresnahan v. Class Representatives

No. 84-1413

IN THE

SUPREME COURT OF THE UNITED

October Term, 1984

COCHRANE & BRESNAHAN,

PAN O’GOLD, INC., IMPERIAL PRODUCTS CORP.,

AND JOHN E. KOERNER & CoO., INC.,

Petitioners

v.

PLAINTIFF CLASS REPRESENTATIVES,

Respondents

In Re: Corn Derivatives Antitrust Litigation

MDL 414

BRIEF IN OPPOSITION OF RESPONDENTS

David Berger Clive S. Cummis

BERGER & SILLS, BECK, CUMMIS.

MONTAGUE, P.C. ZUCKERMAN, RADIS

1622 Locust Street & TISCHMAN

Philadelphia, PA 19103 33 Washington Street

(215) 875-3030 Newark, NJ 07102-3179

Attorneys for Respondent, (201) 643-3232

Golden Quality Ice Attorneys for Respondent,

Cream Company Food Foundation, Inc.

(‘See Inside Front Cover For Names

Of Additional Respondents )

PACKARD PRESS | LEGAL DIVISION, 10th & SPRING GARDEN STREETS, PHILA, PA. 19123 (215) 236-2000

Michael H. King

Ross & HARDIES

150 N. Michigan Avenue.

Suite 2500

Chicago. IL 60601

(312) 558-1000

Attorneys for Respondent.

Consolidated Packaging

Corp.

Joel C. Meredith

MEREDITH & COHEN

117 S. 17th Street.

22nd Floor

Philadelphia, PA 19103

(215) 564-5182

Attorneys for Respondent,

Eastern Candy Company,

Inc

Guido Saveri

SAVERI & SAVERI

Harold k. Kohn

Dianne M. Nast

KOHN. SAVETT. MARION

& GRAF. PLC.

One Reading Center.

24th Floor

1101 Market Street

Philadelphia, PA 19107

(215) 238-1700

Attorneys for Respondents,

Bodines, Inc. and

Cumberland Farms

Dairy, Inc.

Douglas V. Rigler

KAPLAN RUSSIN

VECCHI & JACOBS

1218 Sixteenth Street, NW

Washington, D.C. 20036

(202) 638-0060

Attorneys for Respondent,

G. Heileman Brewing

Company, Inc.

Robert A. Skirnick

WOLF, POPPER, ROSS. WOLFE

111 Sutter Street. Suite 2140 & JonES

San Francisco, CA 94104

(415) 391-0300

Attorneys for Respondents,

Bear Stewart & Corp.,

Eastern Candy Company,

Inc., Health Care

Industries, Inc..

G. Heileman Brewing

Company, Inc., Kalva Corp.,

Korbro Oil Corp.,

Virnelson Bakery, Inc.

Eugene M. Warlich

DOHERTY, RUMBLE & BUTLER

1500 First National Bank Building

St. Paul, MN 55101

(612) 291-9270

Attorneys for Respondent,

Land O'Lakes. Inc.

845 Third Avenue

New York, NY 10022

(212) 759-4600

Attorneys for Respondents,

Eastern Candy Company,

Inc., Korbro Oi! Corp.,

Plantation Confection

Company, Inc.

QUESTION PRESENTED FOR REVIEW

The Petition has been filed on behalf of three plain-

tiffs in the District Court, and on behalf of a law firm

which represented two of those plaintiffs and a class

member in the District Court. The underlying litigation

is an antitrust class action which was settled in 1983.

Those settlements were approved, after briefing and

hearing, by the District Court.

In the District Court, the Petitioner law firm repre-

sented one plaintiff who supported and accepted the pro-

posed settlement, while simultaneously representing an-

other plaintiff who actively opposed the same settlement.

The undersigned Respondents, asserting that this dual

position presented a manifest conflict of interest, moved

in the Third Circuit to disqualify Petitioners. The Court

of Appeals for the Third Circuit granted the Motion to

Disqualify, ruling that it would be unfair to permit one of

Petitioner law firm’s clients to use against another client,

information which had been gained during the joint rep-

resentation.

The question presented for review is as follows:

Did the Court of Appeals in the Corn Derivatives An-

titrust Litigation act within its broad appellate authority

in concluding that Petitioner law firm should be disqual-

ified, where two clients retained Petitioner law firm to

file suit, and where, later, that law firm chose to repre-

sent one of those clients against the other in the course

of the same litigation.

STATEMENT REQUIRED BY RULE 28.1

Respondents are class representatives of the plaintiff

class, a class of purchasers of corn derivatives products,

and include the following class representatives:

Bear Stewart & Corp.

Bodines, Inc.

Cumberland Farms Dairy, Inc., whose parent

is Delaware Food Stores, Inc.

Consolidated Packaging Corp.

Eastern Candy Company, Inc.

Food Foundation, Inc.

Golden Quality Ice Cream Company

G. Heileman Brewing Company, Inc.

Health Care Industries, Inc.

Kalva Corp.

Korbro Oil Corp.

Land O’Lakes, Inc., whose partially owned

subsidiaries are Norris Creameries, Inc.;

Imperial Packaging, Inc.; Imperial, Inc.;

and Lakeside Dairy Company

Plantation Confection Company, Inc.

Virnelson Bakery, Inc.

TABLE OF CONTENTS

Page

QUESTION PRESENTED FOR REVIEW ....... 5

STATEMENT REQUIRED BY RULE 28.1....... ii

TARE Gr Fees CN oc eo ch eis cass iees iv

STATEMENT OF THE CAGE... ook ese ees 2

REASONS FOR DENYING THE WRIT......... 3

I. The Petition Raises No Issues Of Public Impor-

tance or of General Application.............. 4

Il. No Conflict Among The Circuits Is Presented

ee ee I oo dg sn wore Sk Oa ee 5

Cs Sich see pee cae ene ewes tea eee 7

iii

TABLE OF AUTHORITIES

CASES: Page

Analytical, Inc. v. NPD Research, Inc., 708 F.2d

ae, ae (re Ge. Ce a S200

1.B.M. v. Levin, 579 F.2d 271 (3d Cir. 1978)......

In re Eastern Sugar Antitrust Litigation, 697 F.2d

SE, TH Ce ee, SOD 085 its hee ser aemes

Kramer v. Scientific Control Corp., 534 F.2d 1085

(3d Cir.), cert. denied, 429 U.S. 830 (1976)...

Matter of Abrams, 521 F.2d 1094, 1099, (3d Cir. ),

cert. denied, 423 U.S. 1038 (1975)...........

Richardson-Merrell, Inc. v. Ann Elizabeth Koller, et

8, 7. RES RA e Ray aye ean

OTHER AUTHORITIES:

ABA MODEL RULES OF PROFESSIONAL CON-

a "See ere ree ere

iv

5

No. 84-1413

IN THE

SUPREME COURT OF THE UNITED STATES

October Term, 1984

COCHRANE & BRESNAHAN,

PAN O’GOLD, INC., IMPERIAL PRODUCTS CORP.,

AND JOHN FE. KOERNER & CoO., INC.,

Petitioners

VU.

PLAINTIFF CLASS REPRESENTATIVES,

Respondents

In Re: Corn Derivatives Antitrust Litigation

MDL 414

BRIEF IN OPPOSITION OF RESPONDENTS

Pursuant to Rule 27.2(b) of the rules of this Court,

RESPONDENTS, plaintiff class representatives in the

Court below, file this brief in opposition to the Petition for

a Writ of Certiorari seeking to overturn a decision of the

Court of Appeals for the Third Circuit disqualifying the

Petitioner law firm, and respectfully request this Court to

deny the Petition for Writ of Certiorari.

2

STATEMENT OF THE CASE

The Petition has been filed on behalf of three plain-

tiffs in the District Court, and on behalf of a law firm

which represented two of those plaintiffs and a class

member in the District Court.

In the underlying proceeding, numerous cases, most

of which were filed as class actions, were consolidated by

the Judicial Panel on Multidistrict Litigation and trans-

ferred to the United States District Court in Newark,

New Jersey. Each Complaint alleged violations by de-

fendants of the antitrust laws. The actions were resolved

by settlements, which settlements were approved by the

District Court.

In April, 1983, Petitioner, Cochrane & Bresnahan,

stated its opposition on behalf of its clients tu the pro-

posed settlements. Ac cording to Petitioner, Cochrane &

Bresnahan, the firm learned on June 30, 1983, that one

of the plaintiffs (Land O’ Lakes), and a class member

(General Mills), which the Petitioner firm represented,

approved the settlements and wanted to participate in

those settlements. But not until October, 1983, almost

four months later, did Petitioner, Cochrane &

Bresnahan, withdraw its representation of the plaintiff

supporting the settlements. During this time, however,

that firm actively opposed those settlements; settlements

in which two of its clients, Land O’ Lakes and General

Mills, had already expressly stated their wish to partici-

pate.

The client supporting the setthement, Land O’

Lakes, Inc., joined by other plaintiffs in the Court below,

then moved to disqualify Cochrane & Bresnahan who

was its counsel, because of the manifest conflict inher-

ent in such joint representation by the Petitioner law

firm.

Land O’ Lakes, Inc. is also a Respondent ir this

Court, and is opposing the Petition for Certiorari.

3

On November 15, 1984, the Court of Appeals for the

Third Circuit, granted the Motion to Disqualify the Pe-

titioner law firm, holding that:

“... it would be unfair, appearances apart, to permit

{Cochrane & Bresnahan] to use against its former

client the information about the strengths and weak-

nesses of the case gained from the joint representa-

tion. Under these circumstances, [Cochrane &

Bresnahan] must be disqualified.” Pet. App. A at 14a.

The plaintiff class is not now “unrepresented” as a

result of the ruling of the Court of Appeals for the Third

Circuit. At least twenty other class action complaints

were consolidated by the Multidistrict Panel. Counsel in

those actions continue to represent the class.

REASONS FOR DENYING THE WRIT

Nothing in the Petition supports the grant of a Writ

of Certiorari, and none of the points raised by Petitioners

is worthy of review.

First, the Petition raises no issue of public impor-

tance or of general application. In essence, as deter-

mined by the Court of Appeals for the Third Circuit, this

is a simple case:

“... where two clients retained the same law firm to

file suit, and where, later, that law firm chose to rep-

resent one of those clients against the other in the

course of the sarne litigation. In view of our evalua-

tion of the situation, we emphasize that it is unnec-

essary to address the considerable ethical problems

that might arise between an attorney named by the

court to represent the class and members of the

class, or the general problems that might arise when

some members of a class favor a settlement and oth-

ers do not.” Pet. App. A at 11a.

4

Given the factual context of this matter, the Opinion of

the Court of Appeals was confined to narrow issues on

narrow facts.

Second, no conflict among the Circuits is presented

by the Decision of the Court of Appeals, nor is any issue

of broad national iniportance raised by the Petition.

I. The Petition Raises No Issues of Public Importance or

of General Application.

Because Petitioners have raised no issue of public

importance or general application, the Petition should be

denied

In essence, the Petition expresses the dissatisfaction

of a law firm which, to paraphrase the description in the

Opinion of the Court of Appeals, was retained by two

clients to file suit, and then later chose to represent one

client whose interests were in direct conflict with the

other client, in the same litigation.

The Petitioners raise a clear question of dual repre-

sentation which is not difficult to resolve. Simply stated,

a law firm cannot simultaneously represent one client

who accepts a proposed settlement, while representing

another client who opposes the same settlement, and

then correct the ill by belatedly withdrawing from one of

the two representations, four months after objecting to

the proposed settlements.

While Petitioners repeatedly state that the law firm's

client was “uncomplaining”, Petitioners fail to point out

the critical fact that its other client moved to disqualify

Petitioner from the litigation because of the Petitioner

law firm's dual representation. On that Motion, which

was joined by each of the plaintiff Respondents herein,

the Court of Appeals for the Third Circuit exercised its

inherent supervisory powers and determined that the Pe-

titioner law firm, Cochrane & Bresnahan, should be dis-

qualified. See Matter of Abrams, 521 F.2d 1094, 1099

(3d Cir.), cert denied, 423 U.S. 1038 (1975).

5

Not only is there an apparent actual conflict, but

there is a serious appearance of impropriety in represent-

ing clients with adverse interests. In re Eastern Sugar

Antitrust Litigation, 697 F.2d 524, 530 (3d Cir. 1982).

See also, Kramer v. Scientific Control Corp., 534 F.2d

1085 (3d Cir.), cert denied, 429 U.S. 830 (1976); ABA

MODEL RULES OF PROFESSIONAL CONDUCT, Rule

1.9.

Such a manifest conflict of interest cannot be sanc-

tioned by any Court for the sound reasons set forth in the

Opinion of the Third Circuit.

Although Petitioners style the question presented as

involving the right of a class representative to object to a

settlement, Respondents respectfully submit that there

is no such issue before this Court. As described by the

Court of Appeals and as set forth above, this case involves

a conflict caused by Petitioner law firm's representation

at the outset of this litigation of two clients followed by a

change of heart as to that representation after the clients

adopted conflicting positions with respect to the settle-

ments. There was no challenge raised in any Court be-

low as to the right of a class member to object to a class

settlement, nor was that the ground on which the Peti-

tioner law firm’s client sought to disqualify Petitioner.

The issue before the Court of Appeals for the Third Cir-

cuit was simply the duty of individual loyalty counsel

owes to a client, as well as the duty owed to the public to

avoid even the appearance of impropriety to protect the

integrity of our legal system. In re Eastern Sugar Anti-

trust Litigation, supra; See also, 1.B.M. v. Levin, 579

F.2d 271 (3d Cir. 1978).

Il. No Conflict Among The Circuits Is Presented By The

Petition.

There is no conflict among the Circuits raised by Pe-

titioners, and accordingly, there is no conflict presented

for resolution by this Court. No matter how the issue is

6

restyled by Petitioners, the unadorned fact is that a law

firm is not permitted to switch sides if the representa-

tions are substantially related, as they are here, and no

Circuit has held to the contrary. See, e.g., Analytical,

Inc. v. NPD Research, Inc., 708 F.2d 1263, 1268 (7th Cir.

1983).

The issues raised by the instant Petition are not re-

lated to those in Richardson-Merrell, Inc. v. Anne

Elizabeth Koller, et al., No. 84-127, which was argued

this term before this Court. The Richardson Petition in-

volved substantial questions of wide application, includ-

ing appealability of disqualification orders under the col-

lateral order exception to the final judgment rule, and a

constitutional question as to whether the conduct of the

attorneys was protected by the First Amendment. No

such far-reaching procedural or constitutional issue is

presented in the instant Petition.

7

CONCLUSION

Petitioners have failed to show any abuse of discre-

tion by the Court of Appeals, or any conflict between the

Circuits. Accordingly, for the reasons set forth above, the

Petition for Writ of Certiorari should be denied.

DATED: May 15, 1985

David Berger

BERGER &

MONTAGUE, P.C.

1622 Locust Street

Philadelphia, PA 19103

(215) 875-3030

Attorneys for Respondent,

Golden Quality Ice

Cream Company

Michael H. King

Ross & HARDIES

150 N. Michigan Avenue,

Suite 2500

Chicago, IL 60601

(312) 558-1000

Attorneys for Respondent,

Consolidated Packaging

Corp.

Respectfully submitted,

Clive S. Cummis

SILLS, BECK, CUMMIS,

ZUCKERMAN, RADIS

& TISCHMAN

33 Washington Street

Newark, NJ 07102-3179

(201) 643-3232

Attorneys for Respondent,

Food Foundation, Inc.

Harold E. Kohn

Dianne M. Nast

KOHN, SAVETT, MARION

& GRAF, P.C.

One Reading Center,

24th Floor

1101 Market Street

Philadelphia, PA 19107

(215) 238-1700

Attorneys for Respondents,

Bodines, Inc. and

Cumberland Farms

Dairy, Inc.

Joel C. Meredith

MEREDITH & COHEN

117 S. 17th Street,

22nd Floor

Philadelphia, PA 19103

(215) 564-5182

Attorneys for Respondent,

Eastern Candy Company,

Inc.

Guido Saveri

SAVERI & SAVERI

8

Douglas V. Rigler

KAPLAN RUSSIN

VECCHI & JACOBS

1218 Sixteenth Street, NW

Washington, D.C. 20036

(202) 638-0060

Attorneys for Respondent,

G. Heileman Brewing

Company, Inc.

Robert A. Skirnick

WOLF, POPPER, ROSS, WOLF

111 Sutter Street, Suite 2100 & JoNnES

San Francisco, CA 94104

(415) 391-0300

Attorneys for Respondents,

Bear Stewart & Corp.,

Eastern Candy Company,

Inc., Health Care

Industries, Inc.,

G. Heileman Brewing

Company, Inc.,

Kalva Corp.,

Korbro Oil Corp.,

Virnelson Bakery, Inc.

Eugene M. Warlich

DOHERTY, RUMBLE & BUTLER

1500 First National Bank Building

St. Paul, MN 55101

(612) 291-9270

Attorneys for Respondent,

Land O'Lakes, Inc.

845 Third Avenue

New York, NY 10022

(212) 759-4600

Attorneys for Respondents,

Eastern Candy Company,

Inc., Korbro Oil Corp.,

Plantation Confection

Company, Inc.