Case 2:07-cv-02513-GMS Document 542 Filed 07/03/12 Page 1 of 10
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`WO
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`IN THE UNITED STATES DISTRICT COURT
`FOR THE DISTRICT OF ARIZONA
`
`No. CV-07-2513-PHX-GMS
`ORDER
`
`))))))))))))))
`
`Manuel de Jesus Ortega Melendres et al.,
`Plaintiffs,
`
`vs.
`
`Joseph M. Arpaio, in his individual
`capacity as Sheriff of Maricopa County,
`Arizona, et al.,
`Defendants.
`
`The Court held a status conference in this matter to discuss issues implicating the
`Court’s obligations under 28 U.S.C. § 455(a) (2006) and Canon 3C(1)(d)(iii) of the Code of
`Conduct for United States Judges as informed by Advisory Opinion No. 58 of the United
`States Committee on Codes of Conduct. For the reasons discussed below, the Court
`determines that it may hear this case, and the case may proceed to trial.
`BACKGROUND
`This lawsuit was filed on December 12, 2007 on behalf of Manuel de Jesus Ortega
`Melendres and others. (Doc. 1). The case was originally before the Honorable Mary H.
`Murguia. (Id.). On July 15, 2009, Judge Murguia issued an order granting Defendants’
`Motion to Recuse. (Doc. 138). Describing the issue as “a close call,” Judge Murguia found
`that a reasonable person could question her impartiality because her identical twin sister was
`the president and CEO of an organization that had published disparaging material about one
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`Case 2:07-cv-02513-GMS Document 542 Filed 07/03/12 Page 2 of 10
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`party, and therefore Judge Murguia recused herself. The case was subsequently assigned to
`this Court. (Doc. 144). This Court conducted various proceedings and issued various orders
`incident to the processing of the case, including orders granting Plaintiffs’ motions for
`sanctions regarding discovery issues. (Docs. 227, 290).
`On June 17, 2010, after some discovery sanctions were ordered but before specific
`award values were calculated, and before a determination was made as to whether other
`sanctions were appropriate, Plaintiffs’ attorneys from the law firm of Steptoe & Johnson LLP
`(the “Steptoe Attorneys”) withdrew from the case with the Court’s permission, and attorneys
`from the Redwood Shores, California office of Covington & Burling LLP (the “Covington
`Attorneys”) were substituted for them (Doc. 313). As is set forth in greater detail in its
`previous order the Court’s brother-in-law, Keith Teel, is a partner in the Washington, D.C.
`office of Covington & Burling (Doc. 537). The Court thus considered at that time whether
`it should recuse itself.
`Federal statutory law requires that “[a]ny justice judge, or magistrate of the United
`States shall disqualify himself [or herself] in any proceeding in which his [or her] impartiality
`might reasonably be questioned.” 28 U.S.C. § 455(a) (2006). The Code of Conduct for
`United States judges similarly requires a judge to disqualify himself or herself when “the
`judge’s impartiality might reasonably be questioned.” Code of Conduct for United States
`Judges, Canon 3C(1). The Code further specifies that a judge’s impartiality might reasonably
`be questioned when the spouse of a person related to the judge is “known by the judge to
`have an interest that could be substantially affected by the outcome of the proceeding.” Id.,
`Canon 3C(1)(d)(iii). The commentaries to the canons note that “[t]he fact that a lawyer in a
`proceeding is affiliated with a law firm with which a relative of the judge is affiliated does
`not itself disqualify the judge.” Id., Commentary to Canon 3C(1)(d)(iii). But, the commentary
`offers no further guidance defining what constitutes an interest substantially affected by the
`outcome of the proceeding.
`The Court at the time researched what it believed to be the relevant decisional law
`under § 455 and some opinions filed by state judicial ethics advisory committees that
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`Case 2:07-cv-02513-GMS Document 542 Filed 07/03/12 Page 3 of 10
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`construed identical or similar ethical provisions for judges. In its research, the Court did not
`locate or consider Advisory Opinion No. 58 of the United States Committee on Codes of
`Conduct. The advisory opinions of the state courts reviewed by the Court that interpreted
`identical provisions in state codes of conduct generally determined that there was no per se
`rule with respect to when a relative of the judge affiliated with a law firm appearing before
`him or her would have an “interest that could be substantially affected by the outcome of the
`proceeding,” such that the judge’s recusal would be required. Rather, the state advisory
`committees generally opined that such determinations be made on a case-by-case basis after
`the court considered various factors. These factors generally included: whether the relative
`was a partner in the firm, the size of the firm, whether the relative would receive a bonus
`from the case, the size of the community, the nature of the fee being sought, and the
`administrative burdens of recusal. See, e.g., Colo. Supreme Court Judicial Ethics Advisory
`Board, Op. 2005-02 (June 3, 2005), Ill. Judicial Ethics Comm., op. 94-18 (Aug. 25, 1994)
`Tenn. Judicial Ethics comm., Op. 04-01 (Feb. 17, 2004), Wash. Ethics Advisory Comm. Op.
`88-12 (Aug. 30, 1988).
`As set forth in greater detail in its previous order (Doc. 537), the Court considered that
`its brother-in-law was a partner in the Washington D.C. office of Covington & Burling
`engaged in a different practice area than Plaintiffs’ attorneys. The Court also considered that
`Covington & Burling was an international firm with multiple offices, over 200 partners and
`hundreds of other attorneys who were either associates or of counsel to the firm. The Court
`also considered the nature of Covington & Burling’s representation of the Plaintiff class, the
`nature of the injunctive relief which was the sole relief sought by the class, the statutory
`prerequisites on Covington & Burling’s ability to seek reasonable reimbursement for the time
`and costs its lawyers expended in representing the Plaintiffs, and the speculative and small
`nature of any benefit that its brother-in-law could conceivably receive as a result of any
`possible fee award to the firm. The Court also considered the administrative burden on the
`Court in light of the national firms that had been willing to assume Plaintiff’s representation,
`and the possible resulting recusals. After having considered these factors, the Court
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`Case 2:07-cv-02513-GMS Document 542 Filed 07/03/12 Page 4 of 10
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`concluded that “a reasonable person with knowledge of all the facts,” Pesnell v. Arsenault,
`543 F.3d 1038, 1043 (9th Cir. 2008) (quoting United States v. Hernandez, 109 F.3d 1450,
`1454 (9th Cir. 1997)) would not believe that the Court’s brother-in-law had an interest in the
`proceeding that could be substantially affected by its outcome. Thus, the Court continued to
`hear the case.
`Nevertheless, when Plaintiff’s counsel recently advised the Court upon learning of
`Mr. Teel’s relation, that Mr. Teel was unaware of the proceeding, and would receive no
`distribution from it, the Court again reviewed the question. When it did, it located Advisory
`Opinion No. 58 by the United States Committee on Codes of Conduct (June 2009). The
`Court noticed a status conference on the matter and requested the parties “to be ready to
`discuss the extent, if any, to which Advisory Opinion No. 58 issued by the United States
`Committee on Codes of Conduct in June of 2009, affects this Court’s obligations under 28
`U.S.C. § 455(a) (2006).”
`At the hearing on June 29th, all parties argued that recusal in this matter was neither
`mandated nor appropriate. All parties agreed that Advisory Opinion 58 was predicated on the
`conclusion that “an equity partner in a law firm generally has ‘an interest that could be
`substantially affected by the outcome of the proceeding.’” United States Comm. on Codes
`of Conduct. Op. 58 (June 2009) (emphasis added). All parties further agree that such a
`presumption would not be appropriately applied consistent with the applicable Canon when
`no interest of a relative of the Court may be substantially affected. All parties agreed that
`pursuant to the facts here, Mr. Teel’s interest would not be substantially affected by the
`outcome of the proceeding, and that therefore no reasonable objective observer could
`conclude that the judge would be impartial or biased based on his relationship to Mr. Teel.
`ANALYSIS
`1. Canon 3C(1)(d)(iii), Its Commentary and Advisory Opinion No. 58
`In determining its ethical obligations, the Court is obliged to follow the text of the
`Canons that make up the Code of Conduct for United States Judges. There is official
`commentary that accompanies the Canons. That commentary specifies that “the Canons are
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`Case 2:07-cv-02513-GMS Document 542 Filed 07/03/12 Page 5 of 10
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`rules of reason, they should be applied consistently . . . in the context of relevant
`circumstances.” Code of Conduct for United States Judges, Commentary to Canon 1. As a
`further interpretive aid, “[t]he judicial conference has authorized its Committee on Codes of
`Conduct to render advisory opinions about this Code only when requested by a judge to
`whom this Code applies.” Id., Introduction.
`In those instances in which an advisory opinion requested by an individual judge in
`one case would contradict, or exceed, the text of the Canon as applied to the facts of another,
`the Court is obliged, in determining what is ethically appropriate, to follow the text of the
`Canon rather than the contradictory advice contained in the advisory opinion. Further, the
`official commentary is entitled to precedence over a contrary advisory opinion in interpreting
`a Court’s ethical obligation in a given circumstance. This is especially the case when
`extending the obligation to recuse beyond that contemplated by the Canons themselves
`would cause the Court to violate its existing obligations under the Canons to “hear and
`decide matters assigned, unless disqualified.” Id. Canon 3(A)(2); see also Clemens v. U.S.
`Dist. Court for the Central Dist. of California, 428 F.3d 1175, 1179 (9th Cir. 2005) (holding
`that a judge has “as strong a duty to sit when there is no legitimate reason to recuse as he
`does to recuse when the law and the facts require”).
`Of course, even though an opinion of the United States Commission on Codes of
`Conduct is advisory in nature, it should be considered carefully. Advisory Opinion 58, issued
`in June of 2009, which is in many relevant respects similar to its predecessors, “advises that
`if the relative . . . is an equity partner in a law firm that represents a party, the judge must
`recuse,” because it “concludes that an equity partner in a law firm generally has ‘an interest
`that could be substantially affected by the outcome of the proceeding’ in all cases where the
`law firm represents a party before the court.” United States Comm. on Codes of Conduct. Op.
`58 (June 2009). It further notes that if a judge’s relative is an equity partner of a firm
`appearing before him, “the remittal procedures of Canon 3D are not available,” and that
`“[r]ecusal is required.” Id.
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`Case 2:07-cv-02513-GMS Document 542 Filed 07/03/12 Page 6 of 10
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`While such a cautious approach may have value as a prophylactic rule, to the extent
`that this advisory opinion is interpreted or attempts to create a per se rule of recusal whenever
`a Court has a firm appearing before it in which a relative or the spouse of a relative is an
`equity partner, the opinion would extend the rule beyond the text of the Canon or the official
`commentary to it. The advisory opinion itself seems to recognize as much. To the extent that
`it states that an equity partner’s interest “generally,” rather than “always” could be affected
`by the outcome of the proceeding, it implicitly recognizes that there are some circumstances
`in which an equity partner’s interest in a law firm will or may not be substantially affected
`by the outcome of a proceeding before a judge. If the facts involve a circumstance in which
`the equity partner’s interest would not be substantially affected by the outcome of the
`proceeding, then Canon 3C(1)(d)(iii) provides no basis for the Court’s recusal. In such
`circumstances, the Advisory Opinion’s per se rule is contrary to the Code of Conduct and the
`commentaries thereto which make clear that “[t]he fact that a lawyer in a proceeding is
`affiliated with a law firm with which a relative of the judge is affiliated does not of itself
`disqualify the judge.” Commentary to Canon 3C(1)(d)(iii), Code of Conduct for United
`States Judges.
`The Canon requires recusal when an interest is substantial, and “whether an interest
`is substantial is necessarily a fact sensitive inquiry.” In re Mercedes-Benz Antitrust
`Litigation, 226 F. Supp. 2d 552, 555 (D. N. J. 2002). Other courts have previously
`recognized, as this Court did in its original analysis, that “[i]t would simply be unrealistic to
`assume, . . . that partners in today’s law firms invariably ‘have an interest that could be
`substantially affected by the outcome of’ any case in which any other partner is involved.’”
`Pashaian v. Eccelston Props., Inc., 88 F.3d 77, 83 (2d Cir. 1996) (emphasis in original). All
`parties to this case, being made familiar with the facts and the previous determinations of this
`Court, have made clear their position that Mr. Teel has no interest that can be substantially
`affected by the outcome of these proceedings. Plaintiffs are not seeking damages, but the
`court “in its discretion, may allow the prevailing party, other than the United States, a
`reasonable attorney’s fee.” 42 U.S.C. § 1988(b) (2006). The award of such a fee is both
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`Case 2:07-cv-02513-GMS Document 542 Filed 07/03/12 Page 7 of 10
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`speculative and very small as it might apply to augment the salary of an equity partner in
`Covington & Burling. The outcome of the proceeding therefore would not substantially affect
`an interest of Mr. Teel even if he were not walled off from any participation in, or benefit
`from, this case.
`Nevertheless, even should Plaintiffs prevail, and even should the Court thereafter
`exercise its discretion to award fees, Mr. Teel will not receive any financial benefit due to
`the further steps subsequently taken by Covington & Burling to screen him from this case.
`And, as this Court set forth in its previous order, the Court cannot identify any other interest
`that Mr. Teel has that would be substantially affected by the outcome of these proceedings.1
`None of the parties, after having been fully apprised of the facts, have identified such an
`interest. As such, while the Court acknowledges that “an equity partner in a law firm
`generally has ‘an interest that could be substantially affected by the outcome of the
`proceeding,’” in the facts particular to this case, Mr. Teel’s interest cannot be so affected.
`United States Comm. on Codes of Conduct. Op. 58 (June 2009) (emphasis added). In such
`circumstances, the Court has an obligation to follow the language of the Canons themselves,
`not merely the per se rule of the advisory opinion. Because the Court has “as strong a duty
`to sit when there is no legitimate reason to recuse as he does to recuse when the law and the
`facts require,” recusal would not merely be unwarranted, it would itself violate that duty.
`Clemens, 428 F.3d at 1179. To the extent that the Advisory Opinion’s per se rule attempts
`to extend the preclusive effect of Canon 3C(1)(d)(iii) beyond its actual terms, the Court will
`abide by the Code in determining its ethical responsibilities.
`
`1 The Court has considered the impact this case may have on Covington & Burling’s
`reputation, and therefore the reputation on that firm’s partners, whether they are involved in
`the case or not. Although the case is a significant one, it is significant principally in Arizona,
`where Covington & Burling does not have an office. To the extent that there is some
`attention to the case nationwide, the Court concludes, like the district court in Pashaian, that
`the impact of a single case is “not of the significance to either add or detract from its
`reputation . . . even in the nation or perhaps the world.” Pashaian, 88 F.3d at 84. Mr. Teel’s
`reputation at Covington & Burling, where he practices in a different area and a different city
`than Plaintiffs’ attorneys, will not be “substantially affected” by the outcome of this case.
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`Case 2:07-cv-02513-GMS Document 542 Filed 07/03/12 Page 8 of 10
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`2. 28 U.S.C. § 455
`Advisory Opinion No. 58 acknowledges that it does not serve to interpret 28 U.S.C.
`§ 455. But, as the Committee also notes, Canon 3C of the Code closely tracks the language
`of § 455, and the Committee is authorized to provide advice regarding the application of the
`Code. Id.
`Federal circuit courts have twice had the opportunity to interpret the predecessor of
`Advisory Opinion 58 in the context of the recusal statute. In 1980, the Fifth Circuit adopted
`the per se rule of the Advisory Opinion, holding that “when a partner in a law firm is related
`to a judge within the third degree, that partner will always be ‘known by the judge to have
`an interest that could be substantially affected by the outcome’ of a proceeding involving the
`partner’s firm.” Postashnick v. Port City Constr. Co., 609 F.2d 1101, 1113 (5th Cir. 1980)
`(quoting 28 U.S.C. § 455(b)(5)(iii)) (emphasis in original). In Potashnick, three factors
`weighed in favor of recusal: “(1) the judge was so connected with [plaintiff’s] law firm Hand,
`Arendall, Bedsole, Greaves & Johnston (Hand, Arendall) and with [plaintiff’s] chief trial
`counsel . . . that his impartiality might reasonably be questioned; (2) the judge was being
`personally represented in other matters by Hand, Arendall and by [plaintiff’s chief trial
`counsel]; and (3) the judge’s father was a partner in Hand, Arendall.” Potashnick, 609 F.2d
`at 1106. The Circuit declined to find that the judge’s actual rulings demonstrated any bias in
`favor of the plaintiff, who was represented by the judge’s personal lawyer, working at a mid-
`sized Mobile law firm in which the judge’s father was a senior partner, but concluded that
`a per se rule “will serve to promote public confidence in the integrity and impartiality of the
`judiciary in general and of the participating judge in particular.” Potashnick, 609 F.2d at
`1114.
`
`The rise of national law firms led the Second Circuit to reconsider the appropriateness
`of the Advisory Opinion’s per se rule sixteen years later. Considering whether recusal was
`required when a judge’s brother-in-law was an equity partner in a 200-lawyer national firm
`but had played no role in the case before the judge, the Second Circuit found that relying on
`a predecessor to Advisory Opinion 58 in the recusal context was “dubious because the
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`advisory opinion is a nonbinding interpretation of a different rule.” Pashaian v. Eccelston
`Props., Inc., 88 F.3d 77, 84 (2d Cir. 1996). In Pashaian, the Second Circuit wrote that “[i]t
`would simply be unrealistic to assume, with Potashnick, that partners in today’s law firms
`invariably ‘have an interest that could be substantially affected by the outcome of’ any case
`in which any other partner is involved.’” Id. at 83 (emphasis in original). The Second Circuit
`approved of the district court’s “reasonable conclusions” that the interest one partner in an
`international law firm with gross revenues in excess of $100 million could not be
`“substantially affected” by the outcome of any particular case. Id. at 84.
`Although district courts in the Fifth Circuit continue to follow the per se rule of the
`advisory opinion and Potashnick, at least one “has noted that it some serious problems with
`the advisory opinion and with the appellate court interpretations.” Southwest Louisiana
`Healthcare System v. MBIA Ins., 2006 WL 724809, at *3 (Mar. 14, 2006). In that case, the
`court noted that associates and partners alike see some benefit from the firm’s success:
`partners in the form of their equity interest and associates in the form of bonuses, which are
`“determined by the amount of profits realized by the total practice of the firm.” Id. The court
`decided that the proper inquiry was whether the individual actually had a substantial interest
`in the proceeding at hand, and found that the individual in question (the judge’s father, who
`was of counsel to the firm before the judge) “has been completely insulated from any
`participation whatsoever in this case” and that he “will receive no funds on the profits of [the
`client],” rendering recusal unwarranted. Id. at 4. A district court in New Jersey has likewise
`held that relevant precedents “teach that section 455(b)(5)(iii) cannot be applied as a per se
`bar to firms whose partners are related to the judiciary.” In re Mercedes-Benz Antitrust
`Litigation, 226 F. Supp. 2d 552, 555 (D. N. J. 2002). “Whether an interest is substantial is
`necessarily a fact sensitive inquiry, and it cannot fairly be answered by a mechanical ‘no
`partners’ application of section 455(b)(5)(iii).” Id. at 555–56..
`Under the particular circumstances of this case, for the reasons previously set forth,
`no “reasonable person with knowledge of all the facts would conclude that the judge’s
`impartiality might reasonably be questioned.” Clemens, 428 F.3d at 1178 (quoting
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`Herrington v. Cty. of Sonoma, 834 F.2d 1488, 1502 (9th Cir. 1987)). In this case, even more
`than in Pashaian, the relative in question is a partner at a large international law firm, who
`has played and will play no role in this matter. Mr. Teel’s relationship to this matter is also
`more remote than the brother-in-law’s was in Pashaian, because Mr. Teel has been excluded
`from any financial gain that may accrue to Plaintiffs in this suit, substantial or otherwise. All
`parties to this suit have acknowledged that the Pashaian precedent arising from the Second
`Circuit is the appropriate precedent to follow and urge this Court not to recuse. Recusal under
`28 U.S.C. § 455(a) is therefore not warranted. The Court finally notes that the decision on
`whether to recuse is here made in circumstances that greatly favor resolution of this lawsuit:
`the case was filed four and one-half years ago, plaintiffs are represented by their third set of
`attorneys, and one federal judge has already recused herself. Therefore,
`IT IS ORDERED affirming that the trial will proceed on July 19, 2012 at 8:30 a.m.,
`as scheduled.
`Dated this 3rd of July, 2012.
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