The 1st Court of Appeals will hear oral argument April 17 in a mandamus action over a disqualification order. At issue is whether Houston’s Martin Disiere Jefferson & Wisdom can represent the Texas Windstorm Insurance Association (TWIA) in consolidated Hurricane Ike litigation pending in Galveston County.
TWIA wants the appeals court to order 212th District Judge Susan Criss of Galveston to withdraw her order disqualifying Martin Disiere and partner Christopher Martin from representing TWIA in Ike litigation, which is consolidated for pretrial matters in Criss’ court.
However, a group of real parties in interest maintain Criss’ disqualification order was justified. They include Galveston lawyer Craig Eiland and his firm; the city of Santa Fe, TX; members of a purported class of plaintiffs suing TWIA in Galveston County over Hurricane Ike claims; and the Plaintiffs’ Steering Committee in the Hurricane Ike litigation.
"The trial court got it exactly right on disqualification," says Jennifer Bruch Hogan, a partner in Hogan & Hogan in Houston who represents the real parties in interest in the mandamus action, In Re Texas Windstorm Insurance Association. Hogan, who will argue for the real parties in interest, declines further comment.
Levon Hovnatanian, head of the appellate section at Martin Disiere who is working on the mandamus action for TWIA, refers comment to Dale Wainwright, a partner in Bracewell & Giuliani in Austin and a former Texas Supreme Court justice. Wainwright, who will argue for TWIA, did not return a telephone message seeking comment.
According to TWIA’s petition for a writ of mandamus, filed Feb. 12, TWIA hired Martin Disiere in August 2012 to represent it and serve as statewide coordinating counsel for "hundreds" of Hurricane Ike suits filed against it by insureds.
However, TWIA continues in the petition, on Dec. 11, 2012, the city of Santa Fe, a plaintiff, filed a motion to disqualify Martin and Martin Disiere. The city alleged that Martin gave Eiland legal advice in 2011 on Hurricane Ike insurance claims, creating a conflict of interest. Later, in a supplemental motion filed Jan. 21, other parties joined the motion to disqualify: Eiland and A. Craig Eiland Attorney at Law PC, the Plaintiffs’ Steering Committee and members of a putative class.
TWIA further alleges in its petition that Martin simply answered a question posed by Eiland about the industry practice and custom in connection with payment of insurance claims, and Martin did not even bill Eiland for that advice. TWIA alleges that Martin and Eiland were friends and "Eiland would occasionally call Martin to informally seek advice or ask questions."
TWIA alleges that Criss’ order disqualifies Martin Disiere from representing it in connection with litigation filed by about 900 plaintiffs because the Hurricane Ike cases are consolidated before Criss.
In a March 8 response to TWIA’s petition, Santa Fe and the other real-parties-in-interest allege Criss had evidence to grant the motion to disqualify and Martin and his firm had an attorney-client relationship with Eiland and his firm.
"The trial court had ample evidence — certainly the trial court had legally sufficient evidence — to find that Martin and Eiland had an attorney-client relationship with respect to Galveston County’s Hurricane Ike claims against TWIA," Santa Fe and the others allege in the response.
On Feb. 5, Criss signed an order in In Re: Hurricane Ike Litigation granting the motion to disqualify Martin Disiere.
Among several findings in the order, Criss found that Martin Disiere and Martin entered into an attorney/client relationship with Eiland and his firm "concerning multiple matters," and Eiland communicated confidential information to Martin and the firm concerning the County of Galveston’s insurance claims.
She also found that Martin and Martin Disiere’s representation of TWIA in the class action violated several subsections of Texas Disciplinary Rule of Professional Conduct 1.09, which deals with conflict of interest, and it violated Rule 1.15(a)(1), because Martin and the firm failed to disclose to TWIA any conflict of interest. Criss also found that Eiland and his firm have not consented to Martin and Martin Disiere’s representation of TWIA.
In a March 27 reply in support of the petition for writ of mandamus, Martin and his firm allege that only two legal grounds could serve as the basis for their disqualification: violation of Disciplinary Rule 1.09 concerning an alleged conflict of interest, and alleged possible risk of disclosure of confidential information by Martin.
"Both of these grounds fail as a matter of law, which compels reversal of the disqualification order," Martin and his firm argue in the reply.
Judges Terry Jennings, Jane Bland and Michael Massengale are scheduled to hear the arguments.
Martin did not return a telephone message seeking comment.
"Mr. Martin served both as an expert and as a lawyer for me, and he gave me specific legal advice on important issues in the Hurricane Ike litigation. . .," writes Eiland in an email. "Now, he is trying to represent someone adverse to my clients, including on those issues. Our ethics rules don’t allow that without the client waiving it, and the public entities I represent would be prejudiced by his actions."