Moylan v. Paseo View Properties, Inc.

Opinion

FILED SUPERIOR COURT OF GUAM 1 2024 OCT 16 PM 3: 32 2 CLERK OF COURT 3

4 IN THE SUPERIOR COURT OF GUAM 5

6 RICHARD E. MOYLAN, CIVIL CASE NO. CV0760-16 7 Plaintiff/Counterclaim Defendant, 8 vs. DECISION AND ORDER 9 PASEO VIEW PROPERTIES, INC.; AXE 10 MURDERER TOURS GUAM/BEACH HOUSE; JOHN DOE COMPANIES 1-5; AND JOHN DOES A-M. 11 Defendants/Counterclaimants. 12

13 AXE MURDERER TOURS GUAM/BEACH 14 HOUSE; PASEO VIEW PROPERTIES, INC.; E.C. DEVELOPMENT, L.L.P., 15 Third-Party Plaintiffs, 16 vs. 17 DOUGLAS MOYLAN, 18 Third-Party D~fendant. 19

20 This matter came before the Honorable Arthur R. Barcinas on April 25, 2024, for a 21 hearing upon Defendant/Counterclaimant and Third-Party Plaintiff Axe Murderer Tours 22 Guam/Beach House ("Defendant") Motion to Disqualify the McDonald Law Office ("Motion"). 23 Defendant's counsel Attorney Jeffrey A. Cook was present via Zoom. Third-party Defendant 24 Douglas Moylan was also present with counsel Attorney Joseph McDonald. DECISION AND ORDER Civil Case No. CV0760-16

1 INTRODUCTION

2 After many years of intensive litigation before the Honorable Judge Elyze M. Iriarte of

3 the Superior Court, Judge Iriarte having been assigned this case since 2016, Moylan hired the

4 McDonald Law Firm on or around December 14, 2023. This firm, the Defense asserts, is widely

5 known to cause the automatic disqualification of Judge Iriarte. In the present case, the litigation

6 has involved various attorneys and firms, and the court has invested significant judicial

7 resources and time into processing this litigation before Judge Iriarte. Recently, Moylan hired

8 the McDonald Law Firm, which led to Judge Iriarte's foreseeable and automatic recusal.

9 On March 7, 2024, Defendant filed a motion requesting the court to disqualify the

10 McDonald Law Firm, asserting that the hiring of the McDonald firm was specifically intended

1I to cause the recusal of Judge Iriarte. Defendant argues that the engagement of the McDonald's

12 firm violates the rules of professional conduct and constitutes the prohibited practice of judge

13 shopping. The court agrees and grants the motion for disqualification.

14 BACKGROUND

15 In 2014, Attorney Joseph McDonald joined the Office of the Attorney General

16 ("OAG"). Two years later, in 2016, the Honorable Elyze M. Iriarte took the bench. In August of

17 the same year, the Plaintiff initiated a lawsuit against the Defendant concerning the usage of the

18 property at issue in this case. Subsequently, in July 2017, the Defendant filed a counterclaim

19 and a third-party complaint against then-private Attorney Douglas Moylan, whom Attorney

20 Gary Gumataotao represented.

21 As far back as September 2018, the Guam Supreme Court disqualified Judge Iriarte

22 from all criminal cases due to her familial relationship with Attorney McDonald. On January 2,

23 2023, Moylan was sworn in as Attorney General ("AG"), and Attorney Gumataotao

24 Page 2 oflO DECISION AND ORDER Civil Case No. CV0760-l 6

1 subsequently joined the OAG. Attorney William Pole then assumed representation of Moylan in

2 this case. On December 15, 2023, Attorney Charles H. McDonald II, who also has a familial

3 relationship with Judge Iriarte, filed an entry of appearance for the McDonald Law Office

4 (MLO) on behalf of Moylan. The MLO consists of Attorneys Charles and Joseph McDonald.

5 On December 21, 2023, Judge Iriarte filed her disqualification from the case. On March

6 7, 2024, the Defendant filed a motion to disqualify the MLO, alleging that Moylan had hired the

7 MLO to cause Judge Iriarte to recuse herself due to her close familial relationship with the

8 McDonald attorneys. Moylan filed an opposition on February 9, 2024, and the Respondents

9 filed a reply on March 15, 2024.

10 On June 25, 2024, before taking the matter under advisement, the Court sent a request to

11 Judge Iriarte, to consider continuing on the case as the parties had agreed to waive the potential

12 judicial conflict arising from the entry of the MLO. On July 25, 2024, Judge Iriarte filed a

13 Supplemental Statement, stating that she is prevented from presiding over the case under 7

14 GCA § 6105(b) due to her close relationship with Attorney Joseph McDonald, her father's

15 brother. She further noted that, while Attorney Charles McDonald is her second cousin, the

16 small size of the MLO would make it unlikely, if not impossible, to ethically screen the matter

17 from Attorney Joseph McDonald. Judge Iriarte further indicated that she does not believe

18 waivers would resolve the conflict, as her recusal is necessary to uphold the appearance of

19 propriety and maintain public confidence in the impartiality of the courts. Tue Court took this

20 motion under advisement.

21 DISCUSSION

22 Defendant moves the Court to disqualify the MLO from representing Moylan in this

23 case, to sanction the MLO and Moylan, and to return the case to Judge Iriarte, based on

24 Page 3 oflO DECISION AND ORDER Civil Case No. CV0760-16

1 allegations that Moylan deliberately hired the MLO to influence Judge Iriarte to recuse herself

2 from this case.

3 Since 2018, the Guam Supreme Court has held that "the current standard for attorney

4 disqualification is whether an attorney's continued representation of a party or participation in

5 an action violates or significantly risks violating the Guam Rules of Professional Conduct

6 [('GRPC')]." Barrett-Anderson v. Camacho, 2018 Guam 20 ,r 20. The grounds for potential

7 disqualification having arisen in 2023 upon the hiring of the MLO, the Court will apply the

8 Barrett-Anderson standard and conduct its analysis under the GRPC.

9 The Court finds GRPC Rules 1.7, 1.16, 3.5, and 8.4 relevant to its analysis. Under

10 GRPC Rule 1.7,

11 (a) "[A] lawyer shall not represent a client if the representation involves a concurrent conflict of interest. A concurrent conflict of 12 interest exists if: (1) The representation of one client will be directly adverse to 13 another client; or (2) There is a significant risk that the representation of one or more 14 clients will be materially limited by the lawyer's responsibilities to another client, a former client or a third 15 person or by a personal interest of the lawyer. (b) Notwithstanding the existence of a concurrent conflict of interest 16 under paragraph (a), a lawyer may represent a client if: (1) The lawyer reasonably believes that the lawyer will be able to 17 provide competent and diligent representation to each affected client; 18 (2) The representation is not prohibited by law; (3) The representation does not involve the assertion of a claim by 19 one client against another client represented by the lawyer in the same litigation or other proceeding before a tribunal; and 20 (4) Each affected client gives informed consent, confirmed in writing. 21 Guam R. Prof. Conduct 1.7. GRPC Rule 3.5, which governs impartiality and decorum of the 22 tribunal, states that "[a] lawyer shall not: (a) seek to influence a judge, prospective juror or other 23 official by means prohibited by law; ... or (d) engage in conduct intended to disrupt a tribunal." 24 Page4 oflO DECISION AND ORDER Civil Case No. CV0760-16

1 Guam R. Prof. Conduct 3.5(a),(d). GRPC Rule 8.4 further states that "[i]t is professional

2 misconduct for a lawyer to: (a) violate or attempt to violate the Rules of Professional Conduct,

3 knowingly assist or induce another to do so, or do so through the acts of another; ... [or] (d)

4 engage in conduct that is prejudicial to the administration of justice .... " Guam R. Prof. Conduct

5 Rule 8.4(a), (d). Finally, under GRPC 1.16, unless a lawyer is ordered to continue

6 representation by a tribunal, "a lawyer shall not represent a client or, where representation has

7 commenced, shall withdraw from the representation of a client if: ... the representation will

8 result in violation of the rules of professional conduct or other law .... " Guam R. Prof. Conduct

9 l.16(a)(l),(c).

10 I. Allegations of Forum Shopping

11 In the Motion to Disqualify, the Defendant claims that Moylan hired the MLO to

12 intentionally disqualify Judge Iriarte in an act of alleged ''judge-shopping." Defendant alleges

13 that Moylan has made several previous attempts to remove Judge Iriarte from this case and has

14 now hired the MLO knowing that Judge Iriarte would recuse herself due to her history of

15 recusing from cases involving the MLO, given her close family relationship with the firm's

16 principals. Defendant supports this theory with citations to three cases.

17 First, in Grievance Adm 'r v. Fried, Defendant argues that "[i]t is unethical conduct for a

18 lawyer to tamper with the court system or to arrange disqualifications, selling the lawyer's

19 family relationship rather than professional services. The lawyer who joins a case as co-counsel,

20 and whose principal activity is to secure a recusal, is subject to discipline." 570 N.W.2d 262,

21 267 (Mich. 1997). Second, Defendant cites Price v. Reish, stating that "an attorney cannot

22 ethically accept representation in a pending case where the attorney knows that the case has

23 been assigned to a trial judge with whom the attorney has an existing conflict, with the intent of

24 Page 5 oflO DECISION AND ORDER Civil Case No. CV0760-l 6

1 orchestrating the judge's recusal and obtaining a more favorable outcome from a different

2 judge." 780 S.E.2d 745 (Ga. 2015). Finally, Defendant cites Baptiste v. State, emphasizing that

3 "Rules of Recusal are not intended to allow parties and their lawyers to judge-shop and gain a

4 trial advantage." 494 S.E.2d 530 (Ga. App. 1997).

5 In opposition, Moylan argues that the facts and the cases cited by Defendant do not

6 support the judge-shopping allegations. Moylan contends that he did not know Judge Iriarte

7 would disqualify herself before hiring the MLO. He points out that if this were his intent, he

8 would have hired the MLO in 2019 when the firm was first formed. He also asserts his right to

9 the counsel of his choice and a determination of Judge Iriarte's impartiality. Moylan further

10 argues that Defendant has presented no evidence suggesting that the MLO is engaging in

11 unethical behavior by leveraging family relationships rather than providing legal services. He

12 claims that the MLO will handle all his personal legal matters moving foiward, not just this

13 case. Additionally, Moylan asserts that he would suffer substantial prejudice if his counsel is

14 disqualified, while the Defendant would not be prejudiced if the MLO remains on the case.

15 In reply, Defendant asserts that Moylan hired the McDonalds as part-time prosecutors

16 after he became Attorney General, makes no real effort to find alternative counsel, and has

17 previously retained Attorney Curtis Van de Veld. Defendant argues that it is unreasonable for

18 Moy Ian to claim he was unaware of the conflict, and even if he did not know, the MLO should

19 have been aware of the conflict and had an ethical obligation to refuse representation, given that

20 Judge Iriarte would recuse herself.

21 "Litigants do have a right to be represented by counsel, which ordinarily implies a right

22 to lawyers of their choice. However, this right does not entail absolute freedom of choice."

24 Page 6 oflO DECISION AND ORDER Civil Case No. CV07 60-16

1 McCuin v. Texas Power & Light Co., 714 F.2d 1255, 1262 (5th Cir. 1983). "The right to

2 counsel of one's choice may be overridden when compelling reasons exist." Id. at 1263.

3 The exclusivity of the legal profession relies heavily on the ethical standards upheld by

4 its members. Lawyers should not enter into client relationships where their services are sought

5 for reasons other than their legal skills, such as providing the client with a de facto peremptory

6 challenge to a judge. Id. at 1264. Doing so "creates the impression that, for a fee, the lawyer is

7 available for sheer manipulation of the judicial system," which creates an appearance of

8 professional impropriety and discredits the judiciary. Id. at 1265. Ethics committees in multiple

9 states have found it unethical for a lawyer to accept employment in cases where a relative is

10 representing an opposing party, acting as prosecutor, or presiding as a judge. Id., n.33 (citing

11 Comment, Ethical Concerns of Lawyers Related by Kinship or Marriage, 60 Or.L.Rev. 399

12 (1981)).

13 Outside of the GRPC, other courts have also identified certain objective factors to

14 consider and balance in a disqualification analysis. See UCP Int'/ Company, Ltd. v. Balsam

15 Brands Inc., 261 F.Supp.3d 1056, 1058-59 (N.D. Cal. 2017); In re BellSouth Corp., 334 F.3d

16 941, 962-65 (11th Cir. 2003); Robinson v. Boeing Co., 79 F.3d 1053, 1054-56 (11th Cir. 1996).

17 The factors are: (1) the potential for manipulation or impropriety; (2) the judicial time invested;

18 (3) the court's docket; (4) the delay in reaching decision; (5) the injury to the other party; (6) the

19 fundamental right to counsel; and (7) the expense to the party that retained counsel. Robinson,

20 79 F.3d at 1055; BellSouth, 334 F.3d at 962-66. These factors are not exclusive, nor are they all

21 necessary, and their weight varies according to the circumstances. Balsam, 261 F.Supp.3d at

22 1058-59. In these circumstances, the most relevant factors to the Court are the potential for

24 Page7 of IO DECISION AND ORDER Civil Case No. CV0760-16

1 manipulation or impropriety, the judicial time invested, the injury to Defendant, and the

2 fundamental right to counsel.

3 Given the facts, the Court agrees with the Defendant that Moylan's hiring of the MLO

4 leaves the court with but one inescapable conclusion: that the hiring of MLO would have the

5 impermissible result akin to improper forum shopping. The record indicates that Moylan has

6 attempted to remove Judge Iriarte from this case at least four times on behalf of himself and

7 Plaintiff Richard Moylan, despite the assertions by declaration to the contrary. Moreover, it

8 would be nearly impossible for either Moylan or the MLO not to know that Judge Iriarte would

9 recuse herself once the MLO entered the case. Judge Iriarte has a well-documented history of

10 recusing herself from cases involving Attorney Joseph McDonald, a principal at the MLO. The

11 MLO should have foreseen the outcome from experience alone, and both the MLO and Moylan

12 should have known that the facts of this case would have compelled Judge Iriarte's

13 disqualification by the obvious requirements of the Code of Judicial Conduct. At argument and

14 by declaration, the MLO has described in great detail its compliance program to ensure

15 compliance with the GRPC, a program the MLO alleges it has implemented to screen clients

16 and potential conflicts to drive down risks to the furn. See Deel. of Joseph B. McDonald, at 3-4

17 (Apiil 24, 2024 ). It is unclear how this argument is relevant to the Court's consideration, as the

18 risk assessment system described in the Declaration seems more focused and targeted to address

19 risks arising directly from the GRPC pertinent to avoiding client conflicts.

20 The declaration asserts that Moylan did not seek MLO 's representation for the purposes

21 of disqualifying Judge Iriarte. However, given the known risks and the obviously foreseeable

22 results of MLO's entry into this case, the potential for manipulation or impropriety is too high

23 to be disregarded.

24 Page 8 oflO DECISION AND ORDER Civil Case No. CV0760-l 6

1 Further, while Moylan argues that he has no alternative counsel based on the facts

2 developed and the arguments made, without more, the Court remains unconvinced that he could

3 not find another experienced litigator to represent him. Accordingly, the Court does not find that

4 Moylan's fundamental right to counsel would be violated by the disqualification of the MLO in

5 this case.

6 The Court also disagrees with Moylan's claim that the Defendants would face no

7 prejudice by Judge Iriarte's recusal. Changing judges in a nearly decade-old case would be

8 highly disruptive. As the court in McCuin noted, disqualifying a judge mid-case would impose

9 undue burdens on the other parties and the judicial system. McCuin, 714 F.2d at 1263-64. This

10 speaks to the factors of both the injury to the other party, and the judicial time invested.

11 Although Attorney Joseph McDonald stated that he advised Moylan that the MLO

12 ..would not accept an engagement for an improper purpose where the matter is in Judge Iriarte's

13 court," the circumstantial evidence suggests that the MLO should have reasonably foreseen

14 Judge Iriarte's recusal. As a result, the Court finds that the MLO representation, regardless of

15 intent, would be violative of GRPC Rules 1.7, 1.16, 3.5, and 8.4 and would require MLO"s

16 disqualification.

17 The Court concludes that the MLO could also be found to have violated GRPC Rule 3.5

18 by engaging in conduct that could be construed as intended to disrupt a tribunal, as their actions

19 inevitably led to Judge Iriarte's recusal. Similarly, their conduct could also potentially be

20 considered prejudicial to the administration of justice, as against GRPC Rule 8.4.

21 Even if Judge Iriarte's recusal was not their intent, the MLO still violated GRPC Rule

22 1.7 by representing Moylan despite a concurrent conflict of interest. The conflict arose due to

24 Page 9 oflO DECISION AND ORDER Civil Case No. CV0760-16

l the MLO's personal interest in the case, namely their close familial relationship with Judge

2 Iriarte.

3 The Court finds that, upon knowledge that the representation could violate the rules of

4 professional conduct, the MLO's failure to withdraw from said representation constitutes a

5 violation of GRPC Rule 1.16.

6 CONCLUSION

7 For the foregoing reasons, the Court hereby GRANTS Defendants' Motion to

8 Disqualify, and ORDERS that the MLO be disqualified from this case and that the case be

9 reassigned back to Judge Iriarte.

11 OC11 6 2024 IT IS SO ORDERED - - - - - - - - - 12

14 HONORABLE ARTHUR R. BARCINAS 15 Judge, Superior Court of Guam 16

24 Page 10 of IO