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Shields v. General Mills, Inc.

United States District Court, D. Minnesota

December 1, 2017

William Shields, et al., for and in behalf of themselves and other persons similarly situated, Plaintiffs,
v.
General Mills Inc., Defendant.

          Brent C. Snyder, Craig A. Brandt, Snyder & Brandt, P.A., Lucas J. Kaster, Michelle L. Kornblit, Stephen J. Snyder, Steven Andrew Smith, Nichols Kaster, PLLP, counsel for plaintiffs

          Aaron D. Van Oort, Jeffrey P. Justman, Peter Magnuson, Faegre Baker Daniels LLP, Kathryn Mrkonich Wilson, Marko J. Mrkonich, Susan K. Fitzke, Littler Mendelson, PC, Keith C. Hult, Littler Mendelson, PC, counsel for defendant

          REPORT AND RECOMMENDATION

          Katherine Menendez United States Magistrate Judge

         Now before the Court is Defendant General Mills, Inc.'s Motion to Disqualify Counsel, ECF No. 70. For the reasons set forth below, the Court recommends that the motion be denied.

         BACKGROUND

         The defendant seeks to disqualify counsel due to a claimed “unresolvable conflict” created by the plaintiffs' counsel's representation of two plaintiffs in separate but related lawsuits. Def.'s Mem. at 7, ECF No. 72.

         McLeod Litigation

         In 2012, General Mills restructured its workforce in a project referred to as Project Refuel. Mrkonich Decl., ¶ 8, Ex. 2 (“Maxe Arb.”) at 1, ECF No. 73. This resulted in the termination of many employees, including Peggy Maxe. Id. Ms. Maxe and her similarly situated colleagues signed arbitration agreements as part of their termination. See Id. at 2-3. Believing she was fired due to age discrimination, Ms. Maxe then filed a Charge of Discrimination with the Equal Employment Opportunity Commission (“EEOC”). See Id. at 13.

         Plaintiff James Heflin worked at General Mills as a Trade and Business Development Director during Project Refuel. NK Mem. at 2, ECF No. 77. According to in-house counsel for General Mills, James Heflin “was both in Ms. Maxe's supervisory chain and also a direct participant in the decision to terminate Ms. Maxe's employment.” Huiras Decl., ¶ 5, ECF No. 74. In-house counsel asserts that “Mr. Heflin was instrumental in assisting [her] investigation into Ms. Maxe's EEOC Charge, and in preparing [General Mills's] response to the same.” Id., ¶ 6. In contrast to in-house counsel's statements, Mr. Heflin has “almost no recollection” of providing any such assistance and states, “It seems unlikely to me that I discussed strategies with [in-house counsel] at all but I do not have sufficient recollection of my contacts with her to say one way or the other whether we discussed strategies.” Heflin Decl., ¶¶ 4b, 4g, ECF No. 81.

         Ms. Maxe was among the McLeod plaintiffs, represented by Snyder & Brandt, who filed a collective action in 2015 alleging age discrimination by General Mills. See Def.'s Mem. at 5; NK Mem. at 2; SB Mem. at 2, ECF No. 79; see generally McLeod v. General Mills, Inc., 15-cv-00494 (JRT/HB). General Mills moved to stay or dismiss that action pending individual arbitration, the district court judge denied the request, and General Mills appealed to the Eighth Circuit Court of Appeals. See Def.'s Mem. at 5; NK Mem. at 6. On April 14, 2017, the Eighth Circuit remanded with instructions to grant the motion to compel individual arbitration. See Def.'s Mem. at 5; NK Mem. at 6. Shortly after the remand, Nichols Kaster joined Snyder & Brandt in representation of all of the plaintiffs. See Def.'s Mem. at 6; NK Mem. at 7.

         Shield s Litigation

         In 2014, General Mills engaged in further restructuring through Project Catalyst. Mrkonich Decl., ¶ 6, Ex. 1 (“Heflin Arb”) at 6. A group of employees terminated during this second wave of firings, represented by Snyder & Brandt, filed the instant suit in 2016, again alleging age discrimination by General Mills. See Compl., ECF No. 1. The matter was stayed pending a decision from the Eighth Circuit in McLeod. Ord., ECF No 12. During the stay, on August 30, 2016, Mr. Heflin filed a consent form indicating his intent to join the class. Notice of Consent at 3, ECF No. 21. The stay was lifted on May 5, 2017, after the McLeod decision. Nichols Kaster likewise joined Snyder & Brandt in representation of the second-wave plaintiffs on July 25, 2017. Ord., ECF No. 30; Notices of Appearances, ECF Nos. 58-60.

         Individual Arbitration

         Mr. Heflin filed an arbitration demand on July 11, 2017. Heflin Arb. The signature block included both Snyder & Brandt and Nichols Kaster, but Nichols Kaster withdrew on July 25, 2017, after General Mills raised its concerns of conflict. Id. at 25-26; Def.'s Mem. at 7; NK Mem. at 8; SB Mem. at 16.

         Ms. Maxe filed an arbitration demand on August 29, 2017. Maxe Arb. The signature block included only Nichols Kaster. Id. at 27. Moving forward, Snyder & Brandt will handle Mr. Heflin's arbitration with no assistance from Nichols Kaster, and Nichols Kaster will handle Ms. Maxe's arbitration with no input from Snyder & Brandt. NK Mem. at 8; SB Mem. at 16.

         Instant Motion

         On July 24, 2017, counsel for General Mills informed Snyder & Brandt and Nichols Kaster via letter of the potential conflict and its intent to seek disqualification should the conflict remain unaddressed. Mrkonich Decl., ¶ 9, Ex. 3. Snyder & Brandt hired an ethics attorney to evaluate the circumstances by examining their documents and interviewing Mr. Heflin. See id., ¶ 12, Ex. 6; NK Mem. at 7-8; SB Mem. at 4. The attorney concluded Snyder & Brandt's representation of Mr. Heflin created no conflict and sent a letter so indicating to counsel for General Mills. Mrkonich Decl., ¶ 12, Ex. 6. Despite this conclusion, Snyder & Brandt and Nichols Kaster established an “ethical wall” to prevent any appearance of impropriety moving forward and divided the representation as described above. NK Mem. at 8; SB Mem. at 16.

         Counsel for General Mills did not consider this sufficient to address the potential conflict and filed the instant motion. Mot. On October 3, 2017, this Court conducted a hearing on the motion. Min. Entry, ECF No. 82. The Court heard argument from counsel for General Mills, Snyder & Brandt, and Nichols Kaster. Id.

         LEGAL STANDARD

         The Court has discretion to determine whether counsel should be disqualified. Gifford v. Target Corp., 723 F.Supp.2d 1110, 1116 (D. Minn. July 13, 2010). “‘Disqualification is appropriate where an attorney's conduct threatens to work a continuing taint on the litigation and trial.'” Id. (quoting Arnold v. Cargill, Inc., 01-cv-2086 (DWF/AJB), 2004 WL 2203410, at *5 (D. Minn. Sept. 24, 2004)). In making such a determination, a court weighs “the interests and motivations of the attorneys, the clients, and the public.” Id. The Court must ensure the integrity of proceedings while recognizing the importance of a party's right to select counsel. Id. at 1117. Given these lofty concerns, motions for disqualification of counsel are closely considered, but legitimate doubts are resolved in favor of disqualification. Id. Although there are plenty of decisions ...


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