United States District Court, D. South Carolina, Spartanburg Division
MEMORANDUM OPINION AND ORDER DENYING DEFENDANTS'
MOTION TO DISQUALIFY
GEIGER LEWIS UNITED STATES DISTRICT JUDGE
the Marshall Tucker Band, Inc. (MTB) and Doug Gray (Gray)
(collectively Plaintiffs) filed this case alleging claims for
trademark dilution and infringement, breach of contract,
conversion, unfair trade practices, and breach of contract
accompanied by a fraudulent act. They also seek trademark
cancellation and declaratory relief. The Court has
jurisdiction over the matter under 28 U.S.C. §§
1331 and 1367. Pending before the Court is Defendants M T
Industries, Inc. (MTI) and Ron Rainey (Rainey) (collectively
Defendants)'s motion to disqualify Plaintiffs'
counsel, Attorney Michael Wilkes (Wilkes) and Attorney Ellen
Cheek (Cheek) (collectively Plaintiffs' counsel). Having
carefully considered the motion, the response, the reply, the
record, and the applicable law, it is the judgment of the
Court that Defendants' motion will be denied.
FACTUAL AND PROCEDURAL HISTORY
case concerns certain trademarks related to the actual band
itself, the Marshall Tucker Band (the Band or the Name). Gray
is one of the original five members of the Band, and MTB is a
corporate entity related to the Band. ECF No. 31-1 at 2.
Wilkes has served as counsel for Plaintiffs continually since
1995. ECF No. 35 at 4. Cheek began practicing with Wilkes in
March 2003, serving with him as counsel to Plaintiffs since
that time. Id. Wilkes has also performed work for
Plaintiffs that relates to MTI, which is a company the
original members of the Band formed to own the publishing
rights to the first eight albums the Band recorded (the
pre-1984 master recordings). Id. Gray is a 20% owner
of MTI, and Rainey is the majority owner. Id. R a i
n e y s e r v e d as the Band's manager for over
twenty-five years. ECF No. 31-1 at 1.
around 1982, Wilkes defended MTI in a contract suit Warner
Brothers filed against it involving payment for the final
album of a five album contract. ECF No. 35 at 4-5. The case
eventually settled. Id. Following that lawsuit,
Wilkes represented neither Plaintiffs nor MTI until he began
serving as counsel to Plaintiffs in 1995. Id. at 5.
Since the inception of Wilkes's representation of
Plaintiffs in 1995, MTI has employed a number of attorneys as
counsel, including Ron Taft, Ken Anthony, Ken Kraus, Bernard
Fischbach, Michael Martin, and Rick Albert. Id.
Importantly, Ron Taft drafted the 1984 Letter Agreement,
which sets forth ownership in the Name and which both
Plaintiffs and Defendants acknowledge constitutes a crucial
issue at dispute in the instant action. Id.; ECF No.
31-1 at 3. Plaintiffs' counsel played no part in the
drafting or discussion of the 1984 Letter Agreement and had
no involvement at all in that transaction. ECF No. 35 at 5.
approximately 1999 and 2010, at Rainey's request,
Plaintiffs' counsel engaged in legal work on MTI's
behalf. ECF No. 35 at 6. For example, Plaintiffs' counsel
asserted a demand in or around 2003 that certain third
parties cease violating MTI's copyrights in the pre-1984
master recordings by manufacturing and selling unauthorized
recordings of those songs. Id. Plaintiffs'
counsel additionally issued stock certificates at the request
of MTI's corporate counsel and reviewed MTI's bylaws
to determine what basic acts they require the corporation to
take. Id. In 2009 and 2010, Rainey asked
Plaintiffs' counsel to update MTI's corporate
records. Id. at 6-7. Plaintiffs' counsel attest
they possess only MTI's bylaws, shareholders'
agreement, and some stock certificates. Id. at 7.
Because Rainey failed to provide the corporate meeting,
history, election, and officer information they requested,
Plaintiffs' counsel never undertook to prepare or keep
any corporate books for MTI. Id.
2010, Plaintiffs' counsel asked Rainey about the
interrelation between and among the various entities having a
relationship to the Band. ECF No. 31-1 at 4. Plaintiffs'
counsel requested this information from him in relation to
estate planning efforts for Gray, which Plaintiffs'
counsel were undertaking at that time. ECF No. 35 at 6. In
response, Rainey sent Plaintiffs' counsel a
“Marshall Tucker Road Map” (Road Map), which sets
forth the relationships between MTB, MTI, and Marshall Tucker
Entertainment, Inc. (MTE), the three corporate entities
related to the Band. Id. Gray and Rainey share
ownership of MTE, too. Id. at 7. Plaintiffs have
attached the Road Map as an exhibit to the pleadings in this
action. ECF No. 1-4.
2010, Plaintiffs' counsel have actively maintained their
attorney-client relationship with Plaintiffs. ECF No. 35 at
7. To the extent their representation of Plaintiffs has
included work related to MTI, Plaintiffs' counsel have
defined their role as being counsel for Gray, not MTI.
Id. For instance, in 2014, Plaintiffs' counsel
reviewed and provided comments regarding a proposed RED
distribution contract with MTE, and a corresponding license
agreement between MTI and MTE. Id. Gray instructed
Rainey to send these documents to Plaintiffs' counsel for
their review. Id. Plaintiffs' counsel stated to
Rainey that their communications with him were made on
Gray's behalf. Id.
December 6, 2013, MTI filed its applications with the United
States Patent and Trademark Office to register the Name. ECF
No. 15-1 at 16. Upon learning of this, Plaintiffs and
Plaintiffs' counsel called Rainey on January 7, 2015, and
demanded that Defendants cancel the trademarks. ECF No. 35 at
8. When the parties failed to resolve their dispute,
Plaintiffs filed their Complaint with this Court on February
11, 2016, and their Amended Complaint on April 13, 2016. ECF
Nos. 1, 7.
then filed their motion to disqualify on July 12, 2016. ECF
No. 31. Plaintiffs filed their response in opposition on July
29, 2016, ECF No. 35, to which Defendants filed their reply
on August 5, 2016, ECF No. 40. The Court, having been fully
briefed on the relevant issues, is now prepared to discuss
the merits of the motion.
STANDARD OF REVIEW
disqualification of counsel is a “drastic”
measure that should be free from “overly-mechanical
adherence to disciplinary canons at the expense of
litigants' rights freely to choose their counsel.”
Shaffer v. Farm Fresh, Inc., 966 F.2d 142, 146 (4th
Cir. 1992). Moreover, the disqualification of a party's
chosen counsel is a serious matter that should be undertaken
only upon a showing by the moving party that an “actual
or likely” conflict of interest exists, rather than a
mere imagined or improbable conflict. See Richmond Hilton
Assocs. v. City of Richmond, 690 F.2d 1086, 1089 (4th
motion to disqualify counsel is subject to the Court's
supervisory authority to ensure fairness in all judicial
proceedings, Hull v. Celanese Corp., 513 F.2d 568,
571 (2d Cir. 1975), and this Court will apply the South
Carolina Rules of Professional Conduct (RPC) to ensure that
it does so, Rule IV(B), RDE, Local Civ. Rule 83.I.08
(D.S.C.). Although it is the Court's responsibility to
ensure the propriety of the bar, the act of disqualifying a
party's counsel is ordinarily not taken without a strong
showing. See United States v. Miller, 624 F.2d 1198,
1201 (3d Cir. 1980) (stating that “in deciding a motion
to disqualify counsel great care must be taken to respect a
client's choice of counsel while at the same time
maintaining the highest ethical standards of professional
responsibility”). Thus, the ...