Block v. Gennaro's Limited Liability Company
- Virginia Demarchi
- 5:21-cv-00192
- U.S. District Court · Northern District of California
- 5
In Block v. Gennaro’s, Judge Demarchi conditionally granted counsel’s renewed motion to withdraw from representing Gennaro’s.
Gennaro’s Limited Liability Company must obtain new counsel and may face further consequences if it does not. Attorneys Stephan A. Barber, Stephen Cox, and JRG Attorneys at Law must continue forwarding papers during the transition. Hendrik Block and Ganeshkrupa 86 Corporation were identified as other litigants whose possible prejudice from the withdrawal was minimal.
What happened
Block v. Gennaro’s Limited Liability Company concerns attorneys who asked to stop representing Gennaro’s. They also represented Ganeshkrupa 86 Corporation, and the two defendants had a dispute about a lease.
The attorneys said the conflict between the defendants, confidential information they held, Gennaro’s alleged breach of the fee agreement, and their loss of communication with Gennaro’s prevented continued representation. Gennaro’s did not respond, and no other party objected.
Judge Demarchi conditionally granted the renewed motion. The attorneys must continue forwarding court papers to Gennaro’s until it obtains new counsel or the court orders otherwise, and Gennaro’s must obtain a lawyer by March 18, 2022 or show good cause for more time.
The detailed version
- Block v. Gennaro's Limited Liability Company · No. 5:21-cv-00192
- Virginia Demarchi
- Feb. 23, 2022
Background
Attorney Stephan A. Barber, attorney Stephen Cox, and JRG Attorneys at Law represented defendants Gennaro’s Limited Liability Company and Ganeshkrupa 86 Corporation. The court had previously granted their motion to withdraw as counsel for Ganeshkrupa 86 but denied without prejudice their request to withdraw from representing Gennaro’s. The court requested more information about the conflict of interest and counsel’s efforts to protect Gennaro’s interests during withdrawal.
In the renewed motion, counsel explained that Gennaro’s, identified as the landlord, and Ganeshkrupa 86, identified as the tenant, had a dispute about their lease that could lead to litigation. Counsel stated that they possessed confidential information from both defendants and that one defendant’s actions or inactions could prejudice the other’s interests. They also repeated that one client had materially breached the attorney-client fee agreement and that counsel had lost communication with that client despite attempts to reach it by email, voice messages, and texts. Other filings indicated that Gennaro’s was the client with whom counsel had lost contact.
Legal standard
The court explained that attorneys may not withdraw from a federal case until the court grants permission after written notice to the client and other parties who have appeared. Under the California Rules of Professional Conduct, an attorney must withdraw when continued representation would violate the professional rules or the State Bar Act, and may withdraw in circumstances including an unreasonably difficult client, a material breach of the representation agreement after reasonable warning, or a likely violation of professional-conduct rules.
Even when withdrawal is permitted, counsel must take reasonable steps to avoid foreseeable harm to the client. The court also considers the reasons for withdrawal, possible prejudice to other litigants, harm to the administration of justice, and delay. The court had previously found that possible prejudice to Hendrik Block and Ganeshkrupa 86 was minimal, but it needed more information about the conflict between the defendants.
Ruling and conditions
The court concluded that counsel’s explanation showed a conflict of interest requiring withdrawal and that allowing withdrawal would serve the administration of justice. It conditionally granted the renewed motion to withdraw from representing Gennaro’s.
The order imposed these conditions:
- Barber, Cox, and JRG Attorneys at Law must continue accepting service of court papers and papers from opposing parties for forwarding to Gennaro’s until Gennaro’s obtains substitute counsel or the court orders otherwise.
- Gennaro’s may not represent itself or appear through its corporate officers. It must retain a member of the federal bar to represent it, while continuing to meet its obligations as a litigant. The court warned that failure to obtain counsel could lead to striking its pleadings or entering default judgment.
- Counsel must serve the order on the defendants by February 28, 2022, file proof of service, and specifically advise Gennaro’s that it cannot represent itself in federal court.
- Gennaro’s new counsel had to file a notice of substitution by March 18, 2022, unless Gennaro’s showed good cause for additional time.
- If Gennaro’s did not obtain new counsel by March 18, 2022, Barber had to file a declaration identifying Gennaro’s last known address and certifying compliance with the order.
- After a substitution notice or Barber’s declaration, the court would order further proceedings as necessary.
Read the full 5-page opinion on CourtListener, the free public archive maintained by the Free Law Project.