Reply to Sherman Response to Motion to Disqualify Doc 187

REPLY TO SHERMAN RESPONSE TO MOTION TO DISQUALIFY [DOC 172] - Page 1 
IN THE UNITED STATES DISTRICT COURT 
FOR THE NORTHERN DISTRICT OF TEXAS 
DALLAS DIVISION 
    
NETSPHERE, INC.,        §  Civil Action No. 3-09CV0988-F 
MANILA INDUSTRIES, INC., and    § 
MUNISH KRISHAN,       § 
  Plaintiffs.         § 
                        § 
    v.                     §   
                        § 
JEFFREY BARON, and      §   
ONDOVA LIMITED COMPANY,    § 
  Defendants.        § 
 
REPLY TO SHERMAN RESPONSE TO MOTION TO DISQUALIFY 
[DOC 172]   
 
 
TO THE HONORABLE ROYAL FURGESON, U.S. DISTRICT COURT JUDGE: 
   COMES NOW, Jeffrey Baron, Appellant, and subject to the pending motion 
to strike such response, respectfully replies to the response to Motion to Disqualify 
Mr. Urbanik [DOC 172]. 
 
I. SUMMARY 
   Mr.  Urbanik’s  conduct  is  unethical  because  his  position  as  an  advocate 
before this Court was used to interfere with the fair, unbiased hearing of evidence 
at issue before the Court.  The ethical rule prohibits an attorney from doing exactly 
that—being  both  an  advocate  and  a  fact  witness  to  establish  essential  facts  on 
behalf of his client. 
 
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REPLY TO SHERMAN RESPONSE TO MOTION TO DISQUALIFY [DOC 172] - Page 2 
II. THE ETHICAL RULE IS MANDATORY, NOT OPTIONAL 
       Texas  Disciplinary  Rules  of  Professional  Conduct  are  mandatory  in 
character  because  they  establish  the  minimum  level  of  conduct  below  which  no 
lawyer can fall.  Koch Oil Co. v. Anderson Producing, Inc., 883 SW 2d 784, 787 
(Tex.App. Beaumont–1994). 
 
III. THE EVIDENCE TESTIFIED TO BY MR. URBANIK WAS ESSENTIAL 
      The evidence Mr. Urbanik claimed to testify to in his declaration included 
essential  facts  such  as  that  Mr.  Baron  had  taken  steps  had  to  transfer  300,000 
internet domain names, to a foreign entity outside of the jurisdiction of the federal 
courts.  Although the fact itself  is suspect— no attempt was made to change the 
ownership of the names, and the names are serviced ultimately by a US company, 
Mr.  Urbanik  never-the-less  injected  himself  as  a  fact  witness  as  to  those  facts.  
Similarly Mr. Urbanik claims personal knowledge that entities located in the Cook 
Islands are controlled by Mr. Baron, etc.   These are clearly essential facts, and Mr. 
Urbanik clearly is offering claims of personal knowledge as to them.  
 
IV. THE STATE ETHICS RULE 
      In his response, Mr. Sherman makes reference to the comments of the state 
ethics rules,  but noticeably omits mention of the relevant comment, Comment 4.  
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Comment 4 to Rule 3.08 (Lawyer as Witness) explains the application of the rule 
in this circumstance:       
[T]he principal concern over allowing a lawyer to serve as both an advocate 
and  witness  for  a  client  is  the  possible  confusion  that  those  dual  roles  could 
create  for  the  finder  of  fact.  Normally those  dual  roles  are  unlikely  to  create 
exceptional difficulties when the lawyer's testimony is limited to the areas set 
out  in  sub-paragraphs  (a)(1)-(4)  of  this  Rule.  If,  however,  the  lawyer's 
testimony  concerns  a  controversial  or  contested  matter,  combining  the 
roles of advocate and witness can unfairly prejudice the opposing party. A 
witness  is  required  to  testify  on  the  basis  of  personal  knowledge,  while  an 
advocate is expected to explain and comment on evidence given  by others. It 
may not be clear whether a statement by an advocate-witness should be taken as 
proof or as an analysis of the proof. 
 
Mr. Sherman also neglects to fully cite the content of Comment 10:   
This  Rule  may furnish  some guidance  in  those  procedural  disqualification 
disputes  where  the  party  seeking  disqualification  can  demonstrate  actual 
prejudice to itself resulting from the opposing lawyer's service in the dual roles. 
…  [A]  lawyer  should  not  seek  to  disqualify  an  opposing  lawyer  by 
unnecessarily calling that lawyer as a witness. Such unintended applications of 
this Rule, if allowed, would subvert its true purpose by converting it into a mere 
tactical weapon in litigation. 
 
      Notably, Mr. Baron  did not intend to  call  Mr. Urbanik as a witness.    Mr. 
Urbanik  injected  himself  into  the  case  as  a  fact  witness  with  personal 
knowledge  and filed a sworn declaration in opposition to Mr. Baron’s motion to 
stay pending appeal.   Mr. Urbanik’s testimony was the only declaration  testimony 
offered in opposition to the motion to stay.  Accordingly, the attempt to call Mr. 
Urbanik’s as a witness was not done by Mr. Baron (as some litigation ploy),  it was 
done purposely by Mr. Urbanik.   Moreover, counsel for Mr. Baron attempted to 
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REPLY TO SHERMAN RESPONSE TO MOTION TO DISQUALIFY [DOC 172] - Page 4 
give all benefit of the doubt to Mr. Urbanik, and treated him as a party in interest 
who  had filed  on  his own  behalf,  thus  avoiding  any  ethical  issue.        It was only 
when Mr. Urbanik insisted and made clear that under no circumstances was he in 
any way a party to the proceedings, that the ethical issue became acute. 
   As explained in a recent opinion of the Fourteenth District Court of Appeals 
in  Houston  (IN  RE:  GEORGE  E.  GUIDRY,  DWIGHT  W.  ANDRUS,  III  AND 
DWIGHT W. ANDRUS INSURANCE, INC.,  No. 14-10-00464-CV): 
In denying the motion to disqualify, the trial court may have determined that 
allowing Jefferson to occupy dual roles as trial lawyer and fact witness would 
not cause the Brokers actual prejudice. To the extent that the trial court made 
this determination, we conclude that the court clearly abused its discretion. See 
In  re  Bahn,  13  S.W.3d  at  874  (concluding  that  lawyer's  dual  roles  as  trial 
lawyer and fact witness would cause actual prejudice to opposing party). 
 
V. FEDERAL, NOT STATE APPLICATION OF ETHICAL VIOLATION 
   The majority of Mr. Sherman’s offered cases are not relevant to the motion 
to  disqualify  because  “  [A]  District  Court  is  obliged  to  take  measures  against 
unethical conduct occurring in connection with any proceeding before it. Sanders 
v. Russell, 5 Cir. 1968, 401 F.2d 241, 246 ”. Woods v. Covington Cty. Bank, 537 
F.2d  804,  810  (5th  Cir.  1976).    Motions  to  disqualify  are  substantive  motions 
affecting  the  rights  of  the  parties  and  are  determined  under  federal  law.    In  re 
Dresser Industries, Inc., 972 F.2d 540, 543  (5th Cir. 1992). 
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REPLY TO SHERMAN RESPONSE TO MOTION TO DISQUALIFY [DOC 172] - Page 5 
   The  consideration  in  disqualification  is  not  a  state  remedy.    While  state 
ethics violation is key, the Court must consider the motion governed by the ethical 
rules  announced by the national profession  and in the light of the public interest 
and  the  litigants'  rights.  In  Re  Dresser,  and  see  Brennan's  Inc.  v.  Brennan's 
Restaurants, Inc., 590 F.2d 168, 171 (5th Cir. 1979). 
 
VI. OBLIGATION TO THE COURT AND PROCESS, NOT TO CLIENT 
   Rule 3.08 protects against two diverse interests— (1) To protect the client being 
represented  by  preventing  his  own  attorney  from  acting  against  the  client’s 
interests as a witness and (2) To protect the fairness of the judicial process. 
   In our case, the second interest is invoked.  
 
As explained by the Fifth Circuit:  
“A  motion  to  disqualify  counsel  is  a  proper  method  for  a  party-litigant  to 
bring the issues of conflict of interest or a breach of ethical duties to the attention 
of  the  court.”  Indeed  “a  District  Court  is  obliged  to  take  measures  against 
unethical conduct occurring in connection with any proceeding before it.”   
 
  McCuin v. Texas Power & Light Co., 714 F. 2d 1255, 1264 (5th Cir. 1983) 
 
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REPLY TO SHERMAN RESPONSE TO MOTION TO DISQUALIFY [DOC 172] - Page 6 
VII. CONCLUSION 
  Pursuant  to  Texas  Disciplinary  Rules  of  Professional  Conduct  3.08,  it  is 
unethical for Mr. Urbanik to be both an advocate before the Court and a fact witness 
of  facts  essential  to  the  relief  requested  by  him  as  an  advocate.      Because  Mr. 
Urbanik  injected  himself  as  a  fact  witness  as  to  essential  substantive  allegations 
against Mr. Baron, Mr. Urbanik must be disqualified as counsel in this case.   
    
                          Respectfully submitted, 
 
                          /s/ Gary N. Schepps       
                          Gary N. Schepps 
                          State Bar No. 00791608 
                          Drawer 670804 
                          Dallas, Texas 75367 
                          (214) 210-5940 
                          (214) 347-4031 Facsimile 
                          APPELLATE COUNSEL FOR  
                          JEFFREY BARON 
 
 
 
CERTIFICATE OF SERVICE 
This  is  to  certify  that  this  was  served  on  all  parties  who  receive  notification  
through the Court’s electronic filing system. 
/s/ Gary N. Schepps       
                          Gary N. Schepps 
 
 
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