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Medgyesy v. Medgyesy

United States District Court, Seventh Circuit

May 1, 2013

JOHN P. MEDGYESY, individually and in his capacity as trustee for JPM FAMILY TRUSTS, Plaintiff,
ERMA S. MEDGYESY, individually and in her capacity as co-trustee of the LSM Children Trust, et al., Defendant.


JEFFREY COLE, District Judge.


Attorney Nicola Tancredi represents the plaintiffs in this matter. The defendants have come forward with evidence in the form of several emails from Mr. Tancredi that they claim shows he formerly provided legal services for the defendants in a related case. The defendants now ask that he be disqualified from representing the plaintiffs.[1]

This case is a family squabble - apparently a bitter one involving the Oscar Mayer heirs - over the distribution of assets from a number of commingled trusts. On the one side, there is the plaintiff, John P. Medgyesy, acting as trustee for the "family trusts"; on the other side there is the defendant, Erma Medgyesy, acting as trustee for the "children trust." Mr. Tancredi, along with Giovanni Cicione, is currently representing the plaintiff. On March 8, 2013, the attorneys for both sides received a letter from another lawyer, Christopher Sheean, informing them that Mr. Tancredi had been engaged on behalf of both John P. and Erma Medgyesy - as well as other defendants here, including Laura Medgyesy and Laszlo S. Medgyesy - in a prior case regarding the trusts. Mr. Sheean included several pieces of correspondence he had received "from Mr. Tancredi during the time that he was engaged by [Mr. Sheean's] firm in this matter...." ( Plaintiff's Exs. , Dkt. # 31-1, page 2).

The correspondence consists of a number of Mr. Tancredi's own emails on which appear the familiar legend, "Attorney work product" and some of which bore the email address of Mr. Tancredi's law office: "From: Nicola S. Tancredi ". ( Plaintiff's Exs. , Dkt. # 31-1, page 3, 6, 12, 13). One email indicated Mr. Tancredi wanted to review the pleadings in the case and discuss strategy. In it, he recommended removal of the trustee "given [his] multiple breaches of fiduciary duty." ( Plaintiff's Exs. , Dkt. # 31-1, page 4). Another set up a meeting to discuss a plan about going forward with the case. ( Plaintiff's Exs. , Dkt. # 31-1, page 5). In another, after Mr. Tancredi expressed eagerness to become involved in the case: There are some aspects that might be potentially worthwhile from a practice area expertise standpoint in seeing how this case plays out. I am open to investing a certain amount of time for the value of seeing how the case plays out.... Like a surgeon who hears of an interesting operation, I would at least like a window into this one.

( Plaintiff's Exs. , Dkt. # 31-1, page 12)(Emphasis supplied). The email is signed "Best regards, Law Offices of Nicola S. Tancredi." It, like every other email from Mr. Tancredi, was designated "Attorney work product."

In a curious bit of lawyering, the plaintiff first moves to strike the defendant's motion to disqualify because it is not supported by competent evidence. That argument is mystifying since Mr. Tancredi's own affidavit attached to the motion to strike admits that he sent the emails while he was working with Mr. Sheean's firm on the earlier Medgyesy trust case. ( Defendant's Ex. , Tancredi Aff., § 8). Mr. Tancredi's affidavit authenticates the emails and makes them competent evidence even at a trial. See Rule 901(b)(1), Federal Rules of Evidence. The plaintiff's fallback position is that, although Mr. Tancredi worked on the case with Mr. Sheean, he did so in his capacity as a fraud examiner, asset locator, and management consultant - not as an attorney. (Tancredi Aff., § 6).

There are two glaring flaws in the contention. First, if he was not acting as an attorney, why designate every communication "attorney work product, " and why use his attorney email address. There is no explanation for the designation, and the claim that the multiple uses of his law office email address were "inadvertent ministerial administrative errors" is conclusory, and I need not accept it. (Tancredi Aff., §8). Mr. Tancredi makes no attempt to explain who made the supposed errors or how they were made. He does not say who authored the emails, and he does not claim that he was not the author. And if, as it seems, he was the author, his claim of inadvertent administrative errors is implausible.

Second, there is no principled argument as to why the admitted disclosure to him by Mr. Sheean regarding the "contents of the database" - which included "financial and transactional records concerning various Medgyesey family trusts" (Tancredi Aff., §6) - ought not preclude his current representation. He does not explain why he ought to be allowed to continue in a position where there is at least an appearance that he could use what he learned against those who reposed trust in him in the belief that whatever he saw or learned would be maintained in confidence.

It is a curious argument - especially for a lawyer to make - that if one obtains access to confidential information, he is free thereafter to use it against the person from whom he learned it simply because he was not then but will now be acting as a lawyer. That argument makes a mockery out of the fundamental notion of what a lawyer is and does. It is this sort of insouciance that underlay Johnson's famous quip: "he did not care to speak ill of any man behind his back, but he thought the gentleman was a lawyer." James Boswell, The Life of Johnson (1791).[2]

Mr. Tancredi's argument seeks to avoid this pitfall by contending that while he knows that he was briefed on how to operate the trust database, he cannot recall whether he actually examined the data base or any confidential information. (Tancredi Aff., §6). But that claim is not persuasive. Mr. Tancredi's own emails reflect his eagerness to be involved in the case, and given that eagerness coupled with the various recommendations he actually made, such as that the trustee be immediately removed "given [what Mr. Tancredi concluded were] multiple breaches of fiduciary duty, " it is a reasonable, if not ineluctable inference, that he accessed the database and utilized its confidential contents, which he admits included "financial and transactional records concerning various Medgyesey family trusts." (Tancredi Aff., §6). Mr. Tancredi makes no claim that the "financial and transactional records" of the trusts in the database were not confidential. Obviously, they are.


Considering whether to disqualify an attorney presents a difficult balancing act. On the one hand, there is prerogative of a party to proceed with counsel of his choice. Owen v. Wangerin, 985 F.2d 312, 317 (7th Cir. 1993); Schiessle v. Stephens, 717 F.2d 417, 419-20 (7th Cir.1983). On the other, there is the court's duty "to safeguard the sacrosanct privacy of the attorney-client relationship, " Cromley v. Board of Educ. of Lockport Tp. High School Dist. 205, 17 F.3d 1059, 1066 (7th Cir. 1994), and the transcendent goal of maintaining the public trust in the propriety of legal proceedings.

"Where an attorney represents a party in a matter in which the adverse party is that attorney's former client, the attorney will be disqualified if the subject matter of the two representations are substantially related.'" Westinghouse Elec. Corp. v. Gulf Oil. Corp., 588 F.2d 221, 223 (7th Cir.1978). First, however, the question is whether there was an attorney-client relationship at all - a relationship Mr. Tancredi denies. But the emails show that that denial is not credible. For example, on January 7, 2009 after recommending the removal of the trustee, Mr. Tancredi explains the legal consequences and advantages ...

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