Keuffer v. O.F. Mossberg & Sons, Inc.

May 31 2016

DA 15-0349
Case Number: DA 15-0349

IN THE SUPREME COURT OF THE STATE OF MONTANA

2016 MT 127

LUKE KEUFFER and STEPHANIE KEUFFER,

Plaintiffs and Appellees,

v.

O.F. MOSSBERG & SONS, INC.; BURNS AUCTION
& APPRAISAL, LLC; and JOHN DOES 1-5,

Defendants and Appellants.

APPEAL FROM: District Court of the Eighteenth Judicial District,
In and For the County of Gallatin, Cause No. DV 11-547B
Honorable Mike Salvagni, Presiding Judge

COUNSEL OF RECORD:

For Appellants:

Robert K. Baldwin, J. Devlan Geddes, Goetz, Baldwin & Geddes, P.C.,
Bozeman, Montana

For Appellees:

Monte D. Beck, Justin P. Stalpes, Lindsay C. Beck, Beck
& Amsden, PLLC, Bozeman, Montana

Submitted on Briefs: April 27, 2016

Decided: May 31, 2016

Filed:

__________________________________________
Clerk
Justice Michael E Wheat delivered the Opinion of the Court.

¶1 O.F. Mossberg & Sons, Inc., and Burns Auction & Appraisal, LLC (collectively

“Mossberg”), appeal the Order of the Eighteenth Judicial District Court, Gallatin County,

granting Luke and Stephanie Keuffers’ motion to disqualify Mossberg’s counsel. The

District Court disqualified Mossberg’s out-of-state counsel, Renzulli Law Firm, and its

local counsel, Tarlow & Stonecipher, pursuant to Rule 1.20(c) of the Montana Rules of

Professional Conduct. The basis for the court’s disqualification order was a prospective

client consultation that Luke Keuffer had with an attorney from Tarlow & Stonecipher,

which was later used in a deposition of Stephanie Keuffer by John Renzulli of the

Renzulli Law Firm. The court found that the continued involvement in the case by

Mossberg’s counsel gave the Keuffers reason to question whether their case can proceed

fairly and cause to question what they may have disclosed in the consultation to Tarlow

& Stonecipher that may later be used against them in the current litigation. The court

also found that Mossberg’s counsel’s actions undermine the public’s trust in the legal

profession. For the reasons discussed below, we affirm the District Court’s order

disqualifying Renzulli and Tarlow & Stonecipher.

ISSUE

¶2 We restate the dispositive issue on appeal as follows:

Whether the District Court abused its discretion in disqualifying
Mossberg’s counsel.

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 PROCEDURAL AND FACTUAL BACKGROUND

¶3 In October 2008, Luke Keuffer (“Luke”) and his wife, Stephanie Keuffer

(“Stephanie”), were hunting outside White Sulfur Springs, Montana.1 Stephanie was

hunting with a .308 Mossberg model 800 rifle (“Mossberg rifle”). The Keuffers allege

that the Mossberg rifle fell and struck Luke’s rifle and then discharged and shot Luke in

the face, causing serious and permanent injury. On August 10, 2010, Luke called Tarlow

& Stonecipher, PLLC, and spoke to attorney Margaret Weamer “regarding [Luke’s]

possible claim against [a] gun manufacturer for injuries sustained in [a] hunting

accident.” Weamer’s time record indicates that she spoke with Luke for six to twelve

minutes. After discussing the case with Luke, Weamer advised him that Tarlow &

Stonecipher would not be interested in taking the case.

¶4 Luke and Stephanie retained other counsel and, in June 2011, filed a personal

injury action against Mossberg. Tarlow & Stonecipher later agreed to represent

Mossberg as local counsel against Luke in the litigation. Prior to agreeing to represent

Mossberg, Tarlow & Stonecipher ran a conflict check that revealed the phone

conversation between Luke and Weamer. Tarlow & Stonecipher determined that the

phone conversation did not create a conflict with their representation of Mossberg. The

firm disclosed the phone conversation to Mossberg’s national counsel John Renzulli—

who appears pro hac vice in this case—but did not disclose the phone conversation to

Luke’s counsel.

1
Stephanie and Luke have since divorced and she is now Stephanie Peer. The parties
and the District Court refer to her as “Stephanie Keuffer” and we will do the same.
3
¶5 The Keuffers’ counsel remained unaware of the telephone conversation between

Luke and Weamer until Renzulli deposed Stephanie on June 24-25, 2014. Renzulli

began his deposition of Stephanie with an inquiry into other law firms that the Keuffers

may have consulted regarding this case. Five questions into the deposition, Renzulli

asked Stephanie: “Did anyone from – either you or Luke have any conversations with

anybody from Tarlow – T-A-R-L-O-W – Law Firm here in Bozeman?” When Stephanie

responded that she did not remember, Renzulli pushed forward, stating: “All right. Let

me be very direct . . . . This was not the first law firm that you talked to, correct, about

taking this case?” When Stephanie acknowledged that she had made calls to other law

firms before the Keuffers hired their current counsel, Renzulli followed up with the

ensuing exchange:

Q. [W]hen you made a couple of calls, did some of the firms say that they
weren’t interested in the case?

A. Yeah. I don’t remember who, which firms they were exactly, though.

Q. So you told them the facts, and they weren’t interested?

A. Pretty much, yeah, from what I can remember.

¶6 Following the deposition, the Keuffers filed a motion to disqualify both Tarlow &

Stonecipher and the Renzulli Law Firm, LLP, based on the consultation between Luke

and Weamer, and Renzulli’s use of the consultation at Stephanie’s deposition. Mossberg

opposed the motion and filed two affidavits from Weamer regarding her recollection of

the phone conversation with Luke. Mossberg also requested a hearing to resolve the

issue.

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¶7 The District Court held a hearing on April 10, 2015. During the hearing, the

District Court questioned both Weamer and Renzulli. The court specifically questioned

Renzulli regarding why he asked Stephanie about contacting other law firms during the

deposition. Renzulli responded that he typically asks such questions in these types of

cases because he likes “to know if [the plaintiffs are] shopping the case.” Renzulli

indicated further that he intended to introduce that information at trial. The District Court

permitted Weamer to testify for the limited purpose of addressing the conflict check

conducted by Tarlow & Stonecipher. She confirmed that Tarlow & Stonecipher did not

disclose the conflict check results to the Keuffers’ counsel.

¶8 Following the hearing, the District Court issued an order granting the Keuffers’

motion to disqualify both Tarlow & Stonecipher and the Renzulli firm. The District

Court determined that Mossberg’s counsel violated Rule 1.20(b) and (c). The court

found that Renzulli improperly used the Keuffers’ consultation against them during

Stephanie’s deposition. The court found that the purpose of Renzulli’s questioning was

to intimidate the Keuffers and create an impression they have a bad case. The court

indicated the uniqueness of the situation as Renzulli did not use “information learned”

from the consultation, but used the fact that the consultation occurred. The court

concluded that this was equally a violation of the Rules because Renzulli used the

consultation to intimidate and create an adverse inference about the Keuffers’ case. The

District Court disqualified Mossberg’s counsel because their actions defeat the purpose of

the Rules of Professional Conduct which threatens the public’s trust in the legal system.

Mossberg appeals.

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 STANDARDS OF REVIEW

¶9 A district court possesses broad discretion in ruling on a motion to disqualify

counsel. We review a court’s grant of a motion to disqualify for an abuse of discretion.

Schuff v. A.T. Klemens & Son, 2000 MT 357, ¶ 26, 303 Mont. 274, 16 P.3d 1002. A

district court abuses its discretion when “it acts arbitrarily without conscientious

judgment or exceeds the bounds of reason resulting in substantial injustice.” Jacobsen v.

Allstate Ins. Co., 2009 MT 248, ¶ 53, 351 Mont. 464, 215 P.3d 649. Application of the

Rules of Professional Conduct to a given set of facts is a question of law; “[u]ltimately, it

is this Court’s ‘constitutional mandate to fashion and interpret the Rules of Professional

Conduct.’” Krutzfeldt Ranch, LLC v. Pinnacle Bank, 2012 MT 15, ¶ 15, 363 Mont. 366,

272 P.3d 635 (quoting In re Rules of Prof’l Conduct, 2000 MT 110, ¶ 9, 299 Mont. 321,

2 P.3d 806). As a question of law, the district court’s application of the Rules to

disqualify an attorney is reviewed for correctness. In re Marriage of Perry, 2013 MT 6,

¶ 16, 368 Mont. 211, 293 P.2d 170.

DISCUSSION

¶10 Whether the District Court abused its discretion in disqualifying Mossberg’s
counsel.

¶11 The Montana Constitution provides that the Montana Supreme Court may “make

rules governing . . . admission to the bar and the conduct of its members.” Mont. Const.

art. VII, sect. 2, cl. 3; See also Harlen v. City of Helena, 208 Mont. 45, 49, 676 P.2d 191,

193 (1984) (concluding the Court possesses exclusive authority to promulgate rules

governing the conduct of attorneys); Schuff ¶ 33 (upholding the Court’s authority in all

6
matters involving the conduct of attorneys practicing law in this state); In re Rules of

Prof’l Conduct, ¶ 9 (concluding that this Court has a mandate to fashion and interpret the

rules); Krutzfeldt, ¶ 15.

¶12 In Schuff, we noted that although a rule violation is not prima facie grounds for

disqualification, “a trial court may consider attorney violations of the Rules of

Professional Conduct if that misconduct results in prejudice or adversely impacts the

rights of the parties in the case pending before it.” Schuff, ¶¶ 35-37. There, we

concluded:

[T]he gravamen of a motion to disqualify is not that an attorney or firm
violated one of the conflict of interest rules under our Rules of Professional
Conduct (see, e.g., Rules 1.7, 1.8, 1.9, 1.10, 1.16, M. R. Pro. C.); rather, a
motion to disqualify must offer sufficient proof that the continued
representation of one party by the attorney or firm will prejudice or
adversely impact the rights of another party in the matter pending before
the court. Evidence demonstrating that an attorney or firm did, in fact,
violate a professional conduct rule merely serves as additional weight that
may tip the scales in favor of disqualification.

Schuff, ¶ 36.

¶13 The application of the Rules of Professional Conduct in this case turns on how

Mossberg’s out-of-state counsel used the information gained from Luke’s prospective

client consultation with Mossberg’s local co-counsel and whether that use warranted

disqualification. Rule 1.20 governs attorneys in their dealings with prospective clients; it

provides:

(a) A person who consults with or has had consultations with a
lawyer about the possibility of forming a client-lawyer relationship with
respect to a matter is a prospective client.
(b) Even when no client-lawyer relationship ensues, a lawyer who
has had consultations with a prospective client shall not use or reveal

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 information learned in the consultation(s), except as Rule 1.9 would permit
with respect to information of a former client.
(c) A lawyer subject to paragraph (b) shall not represent a client with
interests materially adverse to those of a prospective client in the same or a
substantially related matter if the lawyer received information from the
prospective client that could be significantly harmful to that person in the
matter, except as provided in paragraph (d). If a lawyer is disqualified from
representation under this paragraph, no lawyer in a firm with which that
lawyer is associated may knowingly undertake or continue representation in
such a matter, except as provided in paragraph (d).
(d) Representation is permissible if both the affected client and the
prospective client have given informed consent, confirmed in writing, or:
(1) the disqualified lawyer is timely screened from any participation
in the matter and is apportioned no part of the fee therefrom; and
(2) written notice is promptly given to the prospective client.

M. R. Pro. C. 1.20.

The dissent interprets Rule 1.20 narrowly and in a compartmentalized manner. For the

Rule to have any teeth and be an effective tool for the district courts to utilize in

regulating the conduct of attorneys, it must be broadly construed whereby all the sub-

sections work together as a whole. There is a logical progression from one subsection to

the next which clearly supports a construction of the Rule as a whole. In this case it is

evident that the District Court correctly applied the Rule as a whole in making its

decision. While we recognize that disqualification is a harsh remedy, under the

circumstances of this case we cannot conclude that the District Court abused its

discretion in imposing such a remedy.

Rule 1.20(a)

¶14 Neither party disputes that under Rule 1.20(a) Luke became a prospective client to

Tarlow & Stonecipher when he called the law firm and discussed his case with Weamer.

Because Luke was a prospective client of Tarlow & Stonecipher, certain duties were

8
triggered under the Rule. These duties must be followed by the attorneys that participate

in the prospective client relationship.

Rule 1.20(b)

¶15 Under Rule 1.20(b), a prospective client’s conversation is protected and no

information gained from the consultation may be used or revealed by the lawyer with

whom the client consults. The District Court found that Mossberg’s counsel improperly

used the Keuffers’ consultation against them during Stephanie’s deposition. The court

indicated the uniqueness of the situation as Mossberg did not use “information learned”

from the consultation, but used the fact that the consultation occurred. The court

determined that this was equally a violation of the Rule because Mossberg used the

consultation to intimidate the Keuffers and cause them to question the merits of their

case.

¶16 Mossberg argues on appeal that a conflict occurs not because of the fact of the

consultation, but because of the passing of confidential information from the client to the

attorney that may be “significantly harmful.” Mossberg asserts no such information was

passed and implies that the “use” of information as determined by the District Court is

error. We disagree. When the fact of a consultation is used to attack and intimidate a

party, such conduct constitutes a violation of Rule 1.20 and will support a motion for

sanctions, including disqualification.

¶17 In his deposition of Stephanie, Renzulli questioned her about Luke’s consultation

with Tarlow & Stonecipher. Renzulli’s line of questioning was not idle chit-chat about

whether Stephanie was generally familiar with Bozeman law firms and Tarlow &

9
Stonecipher in particular. He began the deposition by questioning her about law firms

either she or her husband had contacted about this case. He then asked her point blank

whether one of those firms was Tarlow & Stonecipher. Renzulli pressed on by asking,

“[s]o you told them the facts, and they weren’t interested.” Pertaining to Luke’s

consultation with Tarlow & Stonecipher, the record is clear that before he started his

deposition of Stephanie, Renzulli knew that Luke had talked to Weamer, provided her

with facts about his case, and been told that her firm was not interested. Thus, Renzulli

used information learned in the consultation in violation of Rule 1.20(b).

¶18 Rule 1.20(b) does not require that an attorney use a verbatim transcript of the

information obtained during a prospective client consultation in order for it to constitute a

violation of the rule. Nor does Rule 1.20(b) require that the information used or revealed

be “significantly harmful,” as would be required to form the basis for disqualification

under Rule 1.20(c). Rule 1.20(b) places an absolute prohibition against using or

revealing any information learned in the consultation. It should be clarified that the mere

use of information learned in a prospective client consultation, if inadvertent or harmless,

may not by itself form the basis for disqualification. In this case, however, Renzulli

consciously used the information learned in Luke’s consultation with Tarlow &

Stonecipher for tactical litigation purposes. Specifically, the District Court found:

[T]he purpose of Renzulli’s questioning regarding the fact that Plaintiffs
consulted with Tarlow & Stonecipher was to intimidate Plaintiffs and to
create an impression that Plaintiffs have a bad case – so bad that Tarlow &
Stonecipher, having heard the facts, decided to represent the Defendants
instead of Plaintiffs. Using the consultation in this manner gives Plaintiffs
reason to question whether their case can proceed fairly. It also gives
Plaintiffs cause to question what they may have disclosed to Tarlow &

10
 Stonecipher that may later be used against them. While Plaintiffs claim
they cannot remember what they told Tarlow & Stonecipher, they believe
they told all attorneys they consulted with the same information and some
of that information is harmful to them.

The District Court also found that Renzulli’s conduct undermined the public’s trust in the

legal profession.

¶19 In Schuff, we noted that although a rule violation is not prima facie grounds for

disqualification, “a trial court may consider attorney violations of the Rules of

Professional Conduct if that misconduct results in prejudice or adversely impacts the

rights of the parties in the case pending before it.” Schuff, ¶¶ 35, 37. We concluded:

[A] motion to disqualify must offer sufficient proof that the continued
representation of one party by the attorney or firm will prejudice or
adversely impact the rights of another party in the matter pending before
the court. Evidence demonstrating that an attorney or firm did, in fact,
violate a professional conduct rule merely serves as additional weight that
may tip the scales in favor of disqualification.

Schuff, ¶ 36.

¶20 After finding that Renzulli’s questioning was designed to intimidate the Keuffers

and to create an impression that they had a bad case; that it caused the Keuffers to

question whether their case can proceed fairly and whether they may have disclosed to

Tarlow & Stonecipher information that may later be used against them; and that

Renzulli’s conduct undermined the public’s trust in the legal profession, the District

Court concluded that disqualification was appropriate. We do not find that this ruling

constituted an abuse of the broad discretion the district court possesses when ruling on a

motion to disqualify. Schuff, ¶ 26. Although the District Court did not use the precise

words “prejudice or adversely impact the rights of another party,” it does not take the

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Rosetta Stone to decipher the District Court’s assessment of Renzulli’s conduct. We

therefore affirm the District Court’s Order disqualifying Renzulli.

¶21 Mossberg argues the District Court wrongfully imputed the conflict to Tarlow &

Stonecipher. The District Court determined that “while Tarlow & Stonecipher did not

find it necessary to disclose Weamer’s consultation with Luke to Plaintiffs’ counsel, they

did find it to have sufficient pertinence to inform Renzulli . . . .” The court also

determined that because the information came from Tarlow & Stonecipher, it gives the

Keuffers reason to question what they may have disclosed to Tarlow & Stonecipher that

might later be used against them. Based on these findings, the court imputed Renzulli’s

conduct to Tarlow & Stonecipher. Tarlow & Stonecipher are implicated with Renzulli

because, after becoming local co-counsel for Mossberg, they communicated the

substance of the phone call and thereafter participated in the development and

prosecution of the case. The continued participation of Tarlow & Stonecipher in this case

would undermine the remedy imposed on Renzulli. Thus, we affirm the District Court’s

Order disqualifying Tarlow & Stonecipher.

¶22 The District Court’s disqualification of Renzulli and Tarlow & Stonecipher was

not an abuse of discretion. Although the District Court based its ruling on Rule 1.20(c),

we conclude the disqualification was proper because of the violation of Rule 1.20(b) and

the prejudice to the Keuffers resulting from the violation. It is well-established that a

district court’s ruling may be sustained under the “wrong-reason, right-result” appellate

rule. Tipp v. Skjelset, 1998 MT 263, ¶ 16, 291 Mont. 288, 967 P.2d 787. The District

Court incorrectly relied on Rule 1.20(c) as the basis for disqualifying defense counsel;

12
however, it correctly concluded that Renzulli’s conduct warranted disqualification of

Renzulli as well as Tarlow & Stonecipher.

CONCLUSION

¶23 We conclude that defense counsel improperly used information obtained from the

prospective client meeting with Luke, causing prejudice to the Keuffers and leading them

to question the merits of their case. For this and the additional reasons set forth above,

the District Court’s Order disqualifying defense counsel is affirmed.

/S/ MICHAEL E WHEAT

We Concur:

/S/ MIKE McGRATH
/S/ JAMES JEREMIAH SHEA
/S/ JIM RICE

Justice Beth Baker, dissenting.

¶24 I dissent.

¶25 The Court today upholds the District Court’s disqualification order without

reasoned analysis of the applicable Rule. When Luke Keuffer contacted the Tarlow &

Stonecipher firm “about the possibility of forming a client-lawyer relationship,” he

became a prospective client pursuant to M. R. Prof. Cond. 1.20(a). It is undisputed,

however, that the Keuffers never established a client-attorney relationship with the

Tarlow & Stonecipher firm. In Perry, we recognized that Rule 1.20 requires examination

of whether a lawyer received information from a prospective client that could be

13
significantly harmful to the prospective client in the matter. Perry, ¶¶ 21, 24. We noted

that different analyses apply to the duties a lawyer owes to a current or former client.

Perry, ¶¶ 19, 22-23. See Pro-Hand Servs. Trust v. Monthei, 2002 MT 134, 310 Mont.

165, 49 P.3d 56 (relying on M. R. Prof. Cond. 1.9—which applies to former clients—to

determine if there was a “reasonable probability” that confidences were disclosed)

superseded by rule as stated in Perry, ¶ 19; Krutzfeldt (relying on M. R. Prof. Cond. 1.7

and 1.10—which apply to current clients—to determine whether disqualification is

required because counsel breached its duty of loyalty).

¶26 Rule 1.18 of the Model Rules of Professional Conduct “is nearly identical” to

Montana’s Rule 1.20. Perry, ¶ 21. Similar to our discussion in Perry, the comments to

Model Rule 1.18 make clear that while the rule imposes certain duties on a lawyer

relating to prospective clients, those duties do not provide prospective clients with the

same protections as the duties imposed on lawyers relating to current or former clients.

Prospective clients, like clients, may disclose information to a lawyer, place
documents or other property in the lawyer’s custody, or rely on the
lawyer’s advice. A lawyer’s consultations with a prospective client usually
are limited in time and depth and leave both the prospective client and the
lawyer free (and sometimes required) to proceed no further. Hence,
prospective clients should receive some but not all of the protection
afforded clients.

Model R. Prof. Cond. 1.18 cmt. 1 (emphasis added). This difference in duties and

consequent protections makes sense “[b]ecause the relationship between a prospective

client and a lawyer by definition never reaches the stage where the duty of loyalty

attaches with full force.” 1 Geoffrey C. Hazard, Jr. & W. William Hodes, The Law

Governing Lawyers § 21A.6, 21A-15 (3d ed. Supp. 2012). Accordingly, Model Rule

14
1.18 “imposes a less stringent regime on the lawyer than where actual clients and former

clients are involved. Put another way, the protections afforded to prospective clients are

not as extensive as those provided to ‘real’ clients.” Hazard & Hodes, supra, at § 21A.6,

21A-15.

¶27 The District Court disqualified Mossberg’s counsel on the basis of Rule 1.20(c).

The court concluded properly that, because Luke was a prospective client, “Tarlow &

Stonecipher is prohibited from using or revealing information learned in the

consultation,” and that “if Tarlow & Stonecipher received information from Luke that

could be significantly harmful to his case, Tarlow & Stonecipher is prohibited from

representing Mossberg in this case.” The court emphasized that Renzulli’s “motivation”

behind his deposition questions to Stephanie was “improper,” and it found “troubling”

the fact that Tarlow & Stonecipher did not disclose the phone conversation to the

Keuffers’ counsel at the outset.

¶28 The District Court found that Mossberg’s counsel did not use or reveal

information learned from the phone conversation in violation of Rule 1.20(b). The court

concluded, however, that there was “no reason why the rule should not be equally

applicable when an attorney uses the fact that they consulted with a party and declined to

represent that party to intimidate that party or to create an adverse inference about that

party’s case.” The court concluded further that “knowing that certain information was

not disclosed may be just as harmful as information that was disclosed.” The District

Court made no finding that Luke disclosed information that could be significantly

harmful to him in the case, and acknowledged that “it is not clear what information was

15
disclosed/learned during Luke’s 6-12 minute consultation with Weamer.” It found

nonetheless that “defense counsel used the fact that a consultation even occurred against

the [Keuffers] in a significantly harmful manner. Thus, the Court finds that Rule 1.20(c),

Mont. R. Prof. C. is applicable to the particular circumstances of this case.” The court

therefore concluded that “Rule 1.20(c), Mont. R. Prof. C. requires the disqualification of

both Tarlow & Stonecipher and the Renzulli Law Firm.”

¶29 Our rule requiring a finding of prejudice or adverse impact—which we originally

articulated in Schuff—“applie[s] to current clients.” Perry, ¶ 23. See Pro-Hand Servs.

Trust (analyzing whether there was a “reasonable probability” that confidences were

disclosed rather than looking to whether the prospective client would be prejudiced or

adversely impacted). In contrast, with a prospective client, if the information disclosed to

the attorney could be significantly harmful, disqualification is automatic regardless of

prejudice or adverse impact, unless the requirements of Rule 1.20(d) are met.1 By its

plain language, Rule 1.20(c) would disqualify Tarlow & Stonecipher from representing

Mossberg in the proceeding—irrespective of any prejudice to the Keuffers—only if

Weamer “received information from [Luke] that could be significantly harmful to [Luke]

in the matter,” subject to the exceptions allowed by Rule 1.20(d). M. R. Prof. Cond.

1.20(c). The inquiry under Rule 1.20(c) is not “whether information was divulged by the

prospective client but whether such information could be significantly harmful to that

person in that or a related matter.” Perry, ¶ 21.

1
Rule 1.20(d) allows continued representation under certain exceptions, discussed below.
16
¶30 Model Rule 1.18(c), which is identical to Rule 1.20(c), “sets the bar preventing

adverse representation against a former prospective client lower than normal in several

ways.” Hazard & Hodes, supra, at § 21A.6, 21A-15 (second emphasis added). Model

Rule 1.18(c) most significantly lowers the bar on adverse representation by providing that

“the lawyer consulting with the prospective client is not personally barred from later

opposing the client, even in the same or a substantially related matter, unless in addition

the information learned ‘could be significantly harmful.’” Hazard & Hodes, supra, at

§ 21A.6, 21A-15 (emphasis in original).

¶31 The District Court made no finding that Luke divulged any such information in

this case. Although the court correctly recognized that disqualification under Rule 1.20 is

proper only if it could find that Mossberg’s counsel violated Rule 1.20(c), the court

exceeded the proscriptions of the Rule by concluding that Rule 1.20(c) “is applicable to

the particular circumstances of this case” because “defense counsel used the fact that a

consultation even occurred against the [Keuffers] in a significantly harmful manner.”

(Emphasis added.) The court observed that Luke could not remember what he may have

said to Weamer. But the court’s resulting finding that “knowing that certain information

was not disclosed may be just as harmful as information that was disclosed” is not

relevant to an inquiry under Rule 1.20(c), which focuses on information the “lawyer

received” from the prospective client. Perry, ¶ 21. Moreover, after considering the

evidence, the court found that “it is not clear what information was disclosed/learned

during Luke’s 6-12 minute consultation with Weamer.” The District Court did not, and

could not, make the requisite finding under Rule 1.20(c) that Weamer received

17
information that is “significantly harmful” to the Keuffers based upon a finding that it is

unclear what information Luke disclosed. Accordingly, there was no justification for

disqualification under Rule 1.20(c).

¶32 The District Court also considered Rule 1.20(b) and found as a matter of fact that

Mossberg’s counsel “did not use or reveal information learned” during the phone

conversation. The District Court determined, however, that Rule 1.20(b) should be

“equally applicable when an attorney uses the fact that they consulted with a party . . . to

intimidate that party or to create an adverse inference about that party’s case.”

¶33 The Preamble to the Montana Rules of Professional Conduct provides that “[a]

lawyer should use the law’s procedures only for legitimate purposes and not to harass or

intimidate others,” and be “guided by personal conscience and the approbation of

professional peers.” M. R. Prof. Cond. Preamble ¶¶ 6, 8. The Preamble continues:

Within the framework of these Rules . . . many difficult issues of
professional discretion can arise. Such issues must be resolved through the
exercise of sensitive professional and moral judgment guided by the basic
principles underlying the Rules. These principles include the lawyer’s
obligation to protect and pursue a client’s legitimate interests, within the
bounds of the law, while maintaining a professional, courteous and civil
attitude toward all persons involved in the legal system.

M. R. Prof. Cond. Preamble ¶ 10. It is within this context that Rule 1.20(b)’s prohibition

against “us[ing] or reveal[ing] information learned in the consultation(s)” with a

prospective client must be analyzed.

¶34 Here, Renzulli used Luke’s communication with Weamer during his deposition of

Stephanie as a litigation tactic to imply that the Keuffers had a weak case. Renzulli’s

questioning demonstrated a lack of professional, courteous, and civil attitude toward not

18
only the Keuffers, but to the legal system. Renzulli’s attempt to harass and intimidate the

Keuffers was out of bounds. Even though the District Court found as a matter of fact that

Renzulli did not reveal any specific information that Luke divulged to Weamer, the

District Court properly recognized that Luke’s communication to Tarlow & Stonecipher

of “the facts” that prompted him to seek legal assistance was not to be “used” against him

by counsel for the adverse party. Accord Perry, ¶¶ 29-30 (analyzing whether an attorney

violated her duty of confidentiality to a prospective client). See also M. R. Prof. Cond.

Preamble ¶ 18. Renzulli acknowledged that he was attempting to do just that by

suggesting that the Keuffers had to shop the case around before they could find a lawyer

who was willing to take it.

¶35 But the Court misapplies Rule 1.20(b) by upholding disqualification on this basis.

As discussed above, Rule 1.20 does not trigger disqualification where no significantly

harmful information was disclosed. The Court proves the point by its acknowledgment

that Rule 1.20(b) does not “require that the information used or revealed be ‘significantly

harmful,’ as would be required to form the basis for disqualification under Rule 1.20(c).”

Opinion, ¶ 18. See Model R. Prof. Cond. 1.18 cmt. 6 (a “lawyer is not prohibited from

representing a client with interests adverse to those of the prospective client in the same

or a substantially related matter unless the lawyer has received from the prospective

client information that could be significantly harmful if used in the matter” (emphasis

added)).

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¶36 When a lawyer has not received information that could be significantly harmful to

a prospective client, the concerns regarding the adverse use of information by the lawyer

under Rule 1.20(b) are minimized. Stated another way:

If no client relationship is formed, the principle of Rule 1.9—explicitly
cross-referenced by Rule 1.18(b)—prohibits adverse use of information
gained during the earlier consultations with the “almost former clients.” Of
course, if the unfruitful discussions were truly non-substantive, or involved
little or no information “that could be significantly harmful,” in the
language of Rule 1.18(c), the danger that confidentiality will be
compromised is correspondingly small. In such cases the lawyer should not
be prohibited from “using” information that he does not really have.

Hazard & Hodes, supra, at § 21A.5, 21A-10 (citing Pro-Hand Servs. Trust (concluding

that a telephone conversation between a prospective client and a lawyer’s secretary does

not bar the lawyer from subsequently representing the other side, especially where the

prospective client makes no showing that any confidential information was provided)).

Without disclosure of information “that could be significantly harmful” to the Keuffers,

the conclusion follows that disqualification under Rule 1.20 is not proper because

Mossberg’s counsel “is not prohibited from representing” Mossberg under the plain

language of Rule 1.20. Model R. Prof. Cond. 1.18 cmt. 6.

¶37 Absent a basis for disqualification under Rule 1.20(c), disqualification is not

appropriate without the proper showing of harm. We have made clear that “a party

cannot receive relief from a district court for the mere misconduct of an attorney or firm.”

Schuff, ¶ 34. But

a trial court may consider attorney violations of the Rules of Professional
Conduct if that misconduct results in prejudice or adversely impacts the
rights of the parties in the case pending before it. . . . A district court’s

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 discretion in this regard flows from its inherent authority to control trial
administration in the interest of fairness and justice.

Schuff, ¶ 35 (citations omitted). See also § 3-1-111, MCA (granting all courts the power

to “provide for the orderly conduct of proceedings,” and “control, in furtherance of

justice, the conduct” of all other persons “in any manner connected with a judicial

proceeding”). “In order to succeed on a motion to disqualify opposing counsel, a party

‘must offer sufficient proof that the continued representation of one party by the attorney

or firm will prejudice or adversely impact the rights of another party in the matter

pending before the court.’” Krutzfeldt, ¶ 17 (quoting Schuff, ¶ 36). Prejudice in this

context means that, irrespective of how the Keuffers understandably felt after Stephanie’s

deposition, in order to invoke the harsh remedy of disqualification, they must

demonstrate how their rights in the litigation would be adversely impacted by Renzulli’s

and Tarlow & Stonecipher’s continued representation of Mossberg.

¶38 In analyzing attorney disqualification, we have recognized that “disqualification

has a significant effect on litigation and should be imposed sparingly.” Krutzfeldt, ¶ 33.

“If there are good reasons to disqualify counsel, then we accept the burdens that

disqualification imposes. But there should be good reasons.” Krutzfeldt, ¶ 33 (quoting

Ronald D. Rotunda & John S. Dzienkowski, Legal Ethics: The Lawyer’s Deskbook on

Professional Responsibility § 1.7-3, 352 (2011-2012 ed. 2011)). Moreover, because

“[d]isqualification burdens the judicial system with delays and it burdens the party that

must retain and reeducate new counsel in the proceedings,” disqualification is a remedy

that should be imposed only if other remedies are lacking. Krutzfeldt, ¶ 33. In

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Krutzfeldt, we ordered disqualification because of Rule 1.10(a)’s automatic imputed

disqualification when there is a concurrent conflict of interest, Krutzfeldt, ¶ 34; hence,

“there is no course short of disqualifying [the opposing party’s lawyer] which would

respect [counsel]’s duty of loyalty to the Krutzfeldts,” who were his current clients.

Krutzfeldt, ¶ 32. The dearth of cases in which this Court has required disqualification of

an attorney for violation of the Rules of Professional Conduct—particularly when related

to a party with whom the lawyer has formed no attorney-client relationship—

demonstrates the rare imposition of such a harsh remedy.

¶39 The District Court has ample discretion to impose alternate remedies or to

consider whether any sanction may be appropriate against Renzulli personally. Chief

among those remedies would be an order in limine precluding the offensive line of

questioning and any mention of the consultation before a jury. The District Court also

has authority under M. R. Civ. P. 30(d)(2) to impose an appropriate sanction on a person

who frustrates the fair examination of a deponent. As we have recognized, “the Office of

Disciplinary Counsel is the appropriate forum to raise violations of the Montana Rules of

Professional Conduct under Rule 1 of the Montana Rules for Lawyer Disciplinary

Enforcement.” In re Guardianship & Conservatorship of A.M.M., 2015 MT 250, ¶ 77,

380 Mont. 451, 356 P.3d 474. The Rules of Professional Conduct “are designed to

provide guidance to lawyers and to provide a structure for regulating conduct through

disciplinary agencies.” M. R. Prof. Cond. Preamble ¶ 21. Accordingly, a “violation of a

Rule does not necessarily warrant any other nondisciplinary remedy, such as

disqualification of a lawyer in pending litigation.” M. R. Prof. Cond. Preamble ¶ 21.

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Furthermore, the Rules are not to be invoked as a tool in litigation to sanction an attorney.

See M. R. Prof. Cond. Preamble ¶ 21. Rather, “[t]he Rules exist for the protection of

clients.” Krutzfeldt, ¶ 34.

¶40 The interests of Renzulli’s client—about whom the Court is noticeably silent—

also are entitled to consideration before disqualifying counsel of its choice. Recognizing

that a party “must not be lightly separated from her counsel of choice,” we have

suggested that disqualification of counsel should not be used for punitive purposes.

Mowrer v. Eddie, 1999 MT 73, ¶ 23, 294 Mont. 35, 979 P.2d 156. In Krutzfeldt, we

acknowledged the impact on the client of the disqualified firm but, because “there was no

opportunity to implement a screen before [the Krutzfeldts’ attorney] began working” at

the firm of opposing counsel, the prejudice to them could not be undone. Krutzfeldt,

¶ 33. Neither the District Court nor the Court today offer any consideration of the

interests of Mossberg or whether the Keuffers’ substantial rights may be protected by

other means.

¶41 Finally, the Court does not address the Keuffers’ argument that Tarlow &

Stonecipher should have disclosed Luke’s phone call to the Keuffers’ counsel after

discovering the consultation during the conflict check. That argument is not supported by

the Rule. Rule 1.20(c) provides that a lawyer “shall not represent a client with interests

materially adverse to those of a prospective client in the same or a substantially related

matter if the lawyer received information from the prospective client that could be

significantly harmful to that person in the matter, except as provided in paragraph (d).”

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M. R. Prof. Cond. 1.20(c). Rule 1.20(d), in turn, governs disclosure to the prospective

client and provides:

(d) Representation is permissible if both the affected client and the
prospective client have given informed consent, confirmed in writing, or:

1. the disqualified lawyer is timely screened from any participation
in the matter and is apportioned no part of the fee therefrom; and

2. written notice is promptly given to the prospective client.

M. R. Prof. Cond. 1.20(d). In other words, Rule 1.20(d) requires disclosure to the

prospective client only if a lawyer receives information that could be significantly

harmful to the prospective client.

¶42 Similarly, Model Rule 1.18(d) provides that disclosure to a prospective client is

required only “[w]hen the lawyer has received disqualifying information as defined in

paragraph (c).” Model R. Prof. Cond. 1.18(d) (emphasis added). Model Rule 1.18(c)

defines “disqualifying information” as “information . . . that could be significantly

harmful to [the prospective client] in the matter.” Model R. Prof. Cond. 1.18(c).

Accordingly, “informed consent, confirmed in writing,” “written notice,” and screening

under Model Rule 1.18(d) are not necessary unless the “lawyer has received disqualifying

information.” Model R. Prof. Cond. 1.18(d). Stated another way, disclosure under “Rule

1.18(d) comes into effect when [the Rule] disqualifies the lawyer who personally dealt

with the former prospective client.” Rotunda & Dzienkowski, Legal Ethics: The

Lawyer’s Deskbook on Professional Responsibility § 1.18-2, 743 (2015-2016 ed. 2015).

¶43 As the Court implicitly acknowledges, Opinion, ¶¶ 20-21, no showing was made

that significantly harmful information was received by Weamer during her phone

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conversation with Luke. Mossberg’s counsel, therefore, was not required to disclose the

consultation to the Keuffers under Rule 1.20(d).

¶44 In summary, the Court effectively adopts a lower disqualification threshold with

respect to prospective clients than the standards that apply to current and former clients—

at odds with the express language and stated purpose of Rule 1.20. Without a showing

that significantly harmful information was communicated, the Court’s application of Rule

1.20 in these circumstances is gravely mistaken.

/S/ BETH BAKER

Justice Patricia Cotter joins in the dissenting Opinion of Justice Baker.

/S/ PATRICIA COTTER

Justice Laurie McKinnon, dissenting.

¶45 I agree with the Court that there was a violation of Rule 1.20(b) and that the

Keuffers were prejudiced as a result of counsel’s use of Luke’s prospective client

consultation with Mossberg’s local counsel, Tarlow & Stonecipher. I similarly agree that

there was no violation of Rule 1.20(c) because no showing was made that “significantly

harmful information” was conveyed by the Keuffers in the consultation with Weamer. I

also agree with the Court that, pursuant to Schuff, ¶ 36, violations of professional conduct

rules serve as weight which may tip the scales in favor of disqualification, even though

the particular rule violated does not mandate disqualification. I part company with the

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Court, however, in its conclusion that the remedy of disqualification imposed by the

District Court was appropriate.

¶46 In my opinion, the District Court abused its discretion in imposing the severe

remedy of disqualification, particularly given that the relationship between a prospective

client and a lawyer do not impose duties as stringent as between an actual and/or former

client and his lawyer. Imposition of such a severe remedy as disqualification should be

sparingly imposed, in light of its significant effect in disrupting litigation. Krutzfeldt,

¶ 33. Under the circumstances here, disqualification of Mossberg’s counsel was an abuse

of discretion when the District Court could have simply precluded the offensive line of

questioning by both Renzuilli and Tarlow & Stonecipher and thereby maintained the

integrity of the proceeding. The public’s trust in the legal system in not undermined

when a trial court perceives an abuse by counsel and corrects it by a fair, proportionate,

and measured remedy.

¶47 As a final consideration, I think it is evident, that the District Court found the facts

of this case “unique” but, nonetheless, that a Rule 1.20(b) violation had been

substantiated. With respect to Rule 1.20(b), the District Court held:

The Court finds that defense counsel improperly used Plaintiff’s
consultation with Tarlow & Stonecipher against them during Stephanie’s
deposition. This situation is unique in that Rule 1.20(b), Mont. R. Prof. C.,
states that the attorney “shall not use or reveal information learned in the
consultation . . .” and in this case the attorney did not use or reveal
information learned, but rather used the fact that the consultation even
occurred. The Court finds no reason why the rule should not be equally
applicable when an attorney uses the fact that they consulted with a party
and declined to represent that party to intimidate that party or to create an
adverse inference about that party’s case. This is precisely what occurred
in this case.

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While I would not, under the circumstances of this case, find that a violation of Rule

1.20(b) warranted disqualification, I believe the District Court correctly found that Rule

1.20(b) had been violated. As we have held, the violation of a professional conduct

rule—even Rule 1.20(b)—could tip the scales in favor of disqualification. Schuff, ¶ 36.

Nonetheless, while a trial court is in the best position to control and monitor the conduct

of trial counsel, under the circumstances presented here, disqualification of Mossberg’s

counsel was not a measured or fair remedy.

¶48 To the extent we conclude otherwise, I dissent.

/S/ LAURIE McKINNON

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