Submitted September 24, 2013.
Appeal from United States District Court for the Western District of Missouri - Kansas City.
For Zerger & Mauer LLP, Interested party - Appellant: Spencer & Fane, Overland Park, KS; Spencer & Fane, Kansas City, MO.
Before WOLLMAN, BEAM, and SMITH, Circuit Judges.
BEAM, Circuit Judge.
This appeal is a companion to Baker v. Martin Marietta Materials, Inc., 745 F.3d 919 (8th Cir. 2014). In Baker, we determined that the district court lacked subject-matter jurisdiction over the merits and reversed the district court's jurisdictional ruling. Id. at 926. The appeal now before us concerns action the district court took while purporting to exercise jurisdiction over that dispute, namely, disqualifying plaintiffs' counsel, Heather Esau Zerger, Steven E. Mauer, and the law firm of Zerger & Mauer LLP (collectively, " Zerger and Mauer" ). Although we concluded that the district court lacked jurisdiction over the merits case, we now conclude the district court had authority to disqualify counsel and did not abuse its discretion in doing so.
From 2006 through 2010, the City of Greenwood engaged in a dispute with Martin Marietta Materials (" Martin" ) arising out of a rock quarry located south of Greenwood. Specifically, the dispute concerned quarry truck traffic traveling in interstate commerce through the City. Eventually, the parties entered into a settlement in which Martin paid Greenwood $7,000,000, and Greenwood agreed to designate Second Avenue for the truck traffic. In the settlement, Greenwood declared that the truck traffic was reasonable and did not constitute a nuisance. As Greenwood had obtained a prior judgment against Martin in state court amounting to nearly $12,000,000, the settlement represented a significant monetary concession. Greenwood made this concession, however,
so it could designate the route it deemed most beneficial to the City--the Second Avenue route. Zerger and Mauer served as Greenwood's counsel throughout the litigation and settlement, receiving over $4,000,000 in fees.
Subsequently, on July 29, 2011, eighteen individual plaintiffs who held property interests on Second Avenue commenced action in Missouri state court against Martin and other entities (collectively, " Martin" ) involved in transporting materials from the quarry, seeking damages for a private nuisance, among other claims. Zerger and Mauer served as counsel for these plaintiffs. Martin removed the case to federal district court. After determining it had subject-matter jurisdiction over the case, on June 26, 2012, the district court enjoined plaintiffs from pursuing their claims in any forum. This panel later reversed the district court's jurisdictional determination.
However, prior to the district court's resolution of the merits case, on February 21, 2012, Greenwood--a non-party--moved to disqualify Zerger and Mauer from representing the individual plaintiffs, contending that Zerger and Mauer's current representation constituted a conflict of interest. In Greenwood's view, Zerger and Mauer were advancing arguments in the present litigation that directly conflicted with Greenwood's interests. The district court agreed with ...