Like a trial lawyer who knowingly makes a remark before the jury that’s sure to draw an objection, amicus curiae filers often seek to get the ear of the Pennsylvania Supreme Court before the procedural rules clearly allow, hoping to make an impression before the court decides the fate of the petition for review.
But there is a debate among appellate practitioners as to just what Pennsylvania Rules of Appellate Procedure allow for when it comes to parties seeking to file amicus briefs at the petition for allowance of appeal stage of a case.
In two recent orders, the state Supreme Court denied a request by a group of law firms and one by lawyers seeking to weigh in on K&L Gates’ petition for review of the reinstatement of a $500 million malpractice lawsuit against the firm by the trustee of bankrupt beverage maker Le-Nature’s. The court has yet to rule on whether it will grant K&L Gates’ allocatur request, but it declined earlier this month to take a brief from 16 of the state’s law firms in support of K&L Gates’ position. The court declined last week to accept the amicus brief in support of the trustee.
Pennsylvania state appellate courts actually have a much more liberal policy than the federal courts when it comes to accepting amicus briefs, said appellate lawyer Howard J. Bashman, who is a regular appellate columnist for The Legal. If a case has been accepted on appeal, then anyone can file an amicus brief as of right, whereas in federal court, non-governmental parties need permission from either the court or both parties, he said.
But as Bashman reads Pennsylvania Rule of Appellate Procedure 531(a), amicus briefs are not permitted to be filed before the Supreme Court grants allocatur in a case.
Rule 531(a) falls under the appellate rules dealing with participating in a case as a friend of the court. The rule states that “anyone interested in the questions involved in any matter pending in an appellate court, excluding Petitions for Allowance of Appeal, although not a party, may, without applying for leave to do so, file a brief amicus curiae in regard to those questions.”
Bashman said the rule clearly excludes briefs filed at the petitions for allowance of appeal stage. But, Bashman said, the court theoretically has the power to grant a motion to file an amicus brief at that stage. Bashman said he just has never seen a case where the court granted such a motion.
“I can’t necessarily be critical of an attempt to request permission to file notwithstanding the rule because the court has the ability to allow exceptions,” Bashman said. “I just never saw it happen.”
Both the amici in support of K&L Gates and those against the court granting allocatur each filed an application requesting leave to file their amicus briefs in Kirschner v. K&L Gates.
Dechert partner Michael Kichline, along with partner Robert C. Heim, is representing his firm and the group of 15 other law firms that filed the amicus in support of K&L Gates. Kichline said that, from his perspective, the rules are silent on whether the court will accept briefs at the petition for allowance of appeal stage.
Kichline said parties often file amicus briefs at that stage, though he noted they are typically denied. He said the benefit to filing the briefs anyway is twofold. First, someone on the court might latch on to what the brief is arguing and, secondly, it lets the court know there are other people aside from the parties who are interested in the outcome of the case and it being taken up on appeal.
James Koval, director of communications and intergovernmental relations at the Administrative Office of Pennsylvania Courts, pointed to Rule 531(a) when asked whether the Supreme Court accepted briefs at the petition for allowance of appeal stage.
He specifically noted the language regarding “excluding Petitions for Allowance of Appeal,” but didn’t comment further regarding whether the court could or would accept briefs at that stage anyway.
In their application for leave to file the brief, the law firms cited Rule 531.
“Although not expressly stated therein, Rule 531 of the Pennsylvania Rules of Appellate Procedure indicates that an interested party may seek leave to submit an application to participate as amicus curiae in support of a petition for allowance of appeal,” the firms said. “This court has permitted amicus filings upon application in the past.”
Scott M. Hare of Bartony & Hare in Pittsburgh represents legal ethics expert Geoffrey C. Hazard, John Gibbons, Grover C. Brown and Grant & Eisenhofer in their amicus brief in support of trustee Marc Kirschner.
Hare said he would speculate that the court’s denial of amici briefs could signal that it doesn’t need help in deciding whether to take up the case, and knows what it intends to do.
Bashman said people shouldn’t read anything into the court’s denial of the amici applications. He said the court could very well still grant allocatur and the amici would be able to file their briefs then.
In the underlying case, K&L Gates was hired by a special committee of the Le-Nature’s board in 2003 to investigate whether there was fraudulent activity by certain of the company’s executives. K&L Gates found no evidence of fraud, but three years later the company went into bankruptcy and its president was later convicted of fraudulent financial practices and sentenced to more than 20 years in prison.
K&L Gates and accounting firm Pascarella & Wiker had argued the firms only had a duty to the special committee of Le-Nature’s that hired them in 2003, and not to a trustee of the now-bankrupt company.
Allegheny County Court of Common Pleas Senior Judge R. Stanton Wettick Jr. agreed, finding they had no obligation beyond the special committee and that the trustee could not claim damages for deepening insolvency of the company between the 2003 internal investigation and the 2006 collapse of the company.
But Superior Court Judge John L. Musmanno said in his opinion that the special committee had a duty to the company and K&L Gates was providing legal services to Le-Nature’s through the special committee.
“K&L Gates was retained to investigate the exact type of injury being inflicted upon Le-Nature’s,” Musmanno said. “By negligently conducting its investigation, K&L Gates affirmatively caused harm to Le-Nature’s by concealing the looting of the company and wrongdoing by [former CEO Gregory J.] Podlucky, and affirmatively representing that no evidence of fraud or misconduct existed.”
The amici law firms had argued in their brief to the Superior Court that “for the first time,” the court ruled “an implied attorney-client relationship could be inferred from circumstantial evidence even where two sophisticated parties have entered into a representation agreement that expressly disavows that such a relationship exists.”
They argued the engagement letter between K&L Gates and the special committee expressly disavowed any relationship between the law firm and Le-Nature’s.
Aside from Dechert, the firms that signed on to this brief were Buchanan Ingersoll & Rooney; Conrad O’Brien; Dickie McCamey & Chilcote; Hawke McKeon & Sniscak; Kleinbard Bell & Brecker; Lamb McErlane; Margolis Edelstein; McNees Wallace & Nurick; Morgan, Lewis & Bockius; Rhoads & Sinon; Rosenn Jenkins & Greenwald; Schnader Harrison Segal & Lewis; Stevens & Lee; Stradley Ronon Stevens & Young; and Swartz Campbell.
Hare said his clients have argued that, under Delaware law, the corporation and the law firm do have a relationship regardless of what the engagement letter says because the state’s law mandates that the special committee is a fiduciary of the law firm. He said this case is really specific to the facts at issue.