Philadelphia union leader John Dougherty has sued Pepper Hamilton, alleging the firm illegally attached a confidential FBI affidavit to a motion it filed on behalf of client Philadelphia Media Network in defense of a defamation suit Dougherty brought against the company. The complaint further alleges that the contents of that document formed the basis of a story published by The Philadelphia Inquirer and Philly.com, both of which are owned by PMN, soon after the motion was filed.
In addition, the complaint alleges Pepper Hamilton has used information it received during the course of its previous representation of Dougherty against him.
Pepper Hamilton managing partner Thomas J. Cole Jr., however, told The Legal on Tuesday that Pepper Hamilton has been "very vigilant" in ensuring that no confidential information provided to the firm by Dougherty has been used against him during the course of the firm’s representation of PMN.
Thomas E. Zemaitis, a partner at Pepper Hamilton and a member of the firm’s Office of General Counsel, also told The Legal on Tuesday that the FBI affidavit was a public document at the time the firm obtained it.
The complaint in Dougherty v. Pepper Hamilton, filed Monday in the Philadelphia Court of Common Pleas, names Pepper Hamilton, along with firm partners Amy B. Ginensky and Michael E. Baughman and two associates, as defendants.
The complaint alleges that Pepper Hamilton, while defending PMN against a defamation suit filed by Dougherty, provided PMN with a copy of a motion for summary judgment and an attached confidential FBI affidavit it intended to file in the Philadelphia Court of Common Pleas and that those documents formed the basis of an Inquirer story published just days later.
The affidavit, according to the complaint, was signed by an FBI agent in support of the issuance of a search warrant of Dougherty’s residence during the time that Pepper Hamilton was representing him in a case involving a federal investigation related to a grand jury subpoena he received.
The affidavit had originally been filed in January 2008 as part of "Document No. 27" in the federal criminal case against Donald Dougherty Jr. in the U.S. District Court for the Eastern District of Pennsylvania.
However, according to the complaint, the affidavit supposed to have been attached to Document No. 27 was actually in support of a search of Donald Dougherty’s premises.
Donald Dougherty, who formerly operated Dougherty Electric Inc., is not related to John Dougherty, the business manager and leading figure in the International Brotherhood of Electrical Workers Local 98. The Inquirer story included allegations that the two had been involved in several transactions, according to the complaint.
In April 2008, the complaint alleges, Document No. 27 was "inexplicably" removed from "restricted status" and made available for public access, violating Local Federal Criminal Rules 6.1(c)(2) and (c)(4) as well as the Department of Justice’s policy.
Still, according to the complaint, the affidavit went unnoticed for nearly five years from the time it was filed.
But on December 10, 2012, one day before a court-ordered hearing on a motion John Dougherty filed seeking to disqualify Pepper Hamilton from representing any defendants in the defamation case, Pepper Hamilton, on behalf of PMN, filed a motion for summary judgment that included the FBI affidavit attached as "Exhibit A," according to the complaint.
The motion was accepted for filing by the Philadelphia Court of Common Pleas on December 11, 2012, according to the complaint.
On December 12, 2012, the Inquirer and Philly.com published a story that "relies almost exclusively" on the information contained in the affidavit in an attempt "to smear" John Dougherty, the complaint alleges.
The complaint alleges that the fact that the article ran one day after the motion was accepted for filing "creates a reasonable inference that both were done in coordination, cooperation and collusion by and between Pepper and its lawyers and PMN and PMN (Digital), their present media clients, to publicly harm Dougherty, Pepper’s former client."
"Moreover, the length and detail of the December 12, 2012, article creates a strong inference that its drafting began days in advance of December 12, 2012," the complaint alleges.
The complaint further alleges that the article "deals only with the subject areas of the federal investigation for which Pepper had served as Dougherty’s legal representatives and counsel."
According to the complaint, Baughman has admitted that Pepper Hamilton provided PMN with a copy of the motion and the FBI affidavit prior to the publishing of the Inquirer article.
After the article was published, the U.S. Attorney’s Office took action to have the affidavit made inaccessible to the public in the criminal case against Donald Dougherty, but Pepper Hamilton has refused to withdraw its motion for summary judgment in the defamation suit, according to the complaint.
The complaint alleges Pepper Hamilton has breached its fiduciary duty to John Dougherty by using information it gained as his lawyer against him in the defamation case.
The complaint also alleges that Pepper Hamilton never obtained Dougherty’s informed consent regarding the conflict posed by its representation of PMN in the defamation suit.
Because of this, the suit alleges, Dougherty has "no assurances or reason to believe" that the information he provided to the Pepper Hamilton lawyers who represented him will not now be shared with the Pepper Hamilton lawyers representing PMN.
The complaint also alleges Pepper Hamilton breached its contract with Dougherty, which included covenants that, among other things, required the firm to "preserve the confidences and secrets" of Dougherty and to "avoid even the appearance of impropriety."
Dougherty is seeking punitive and compensatory damages, according to the complaint.
Cole told The Legal on Tuesday that none of the Pepper Hamilton attorneys who represented Dougherty are representing PMN.
Zemaitis also told The Legal on Tuesday that Philadelphia Court of Common Pleas Judge Sandra Mazer Moss has denied all of Dougherty’s previous motions seeking to disqualify Pepper Hamilton from representing defendants in the defamation case.
Dougherty’s attorney, Joseph R. Podraza Jr. of Sprague & Sprague in Philadelphia, declined to comment on the suit.
Baughman and Ginensky did not return calls seeking comment.