United States v. Supreme Court of New Mexico

980 F.Supp.2d 1334

UNITED STATES of America, Plaintiff,

v.SUPREME COURT OF NEW MEXICO, The Disciplinary Board of New Mexico, and Office of the Disciplinary Counsel of New Mexico, Defendants.

Case No. 13cv0407 WJ/LFG.

United States District Court, D. New Mexico.

Nov. 1, 2013.

Lisa Olson, U.S. Department of Justice, Washington, DC, Steven C. Yarbrough, U.S. Attorney's Office, Albuquerque, NM, for Plaintiff.

Paul J. Kennedy, Paul Kennedy & Associates, PC, Albuquerque, NM, for Defendants.

MEMORANDUM OPINION AND ORDER DENYING DEFENDANTS' MOTION TO DISMISS FOR LACK OF JURISDICTION AND FAILURE TO JOIN NECESSARY AND INDISPENSABLE PARTIES

WILLIAM P. JOHNSON, District Judge.

THIS MATTER comes before the Court upon Defendants' Motion to Dismiss under Fed.R.Civ.P. 12(b)(1) and 12(b)(7) for Lack of Jurisdiction and Failure to Join Necessary and Indispensible Parties, filed July 5, 2013 (Doc. No. 15). Having considered the parties' briefs and the applicable law, the Court finds that Defendants' motion is not well-taken and, therefore, is DENIED.

Background

The United States instituted this action facially challenging the New Mexico Rule of Professional Conduct 16–308(E) (“Rule 16–308(E)”) as it applies to federal prosecutors. Rule 16–308(E) provides a prosecutor shall not:

subpoena a lawyer in a grand jury or other criminal proceeding to present evidence about a past or present client unless the prosecutor reasonably believes:

(1) the information sought is not protected from disclosure by any applicable privilege;

(2) the evidence sought is essential to the successful completion of an ongoing investigation or prosecution; and

(3) there is no other feasible alternative to obtain the information.

Plaintiff argues that Rule 16–308(E) as it applies to federal prosecutors is preempted by federal law.¹ Further, Plaintiff argues that although no federal prosecutors have been disciplined under Rule 16–308(E), federal prosecutors have changed their behavior in order to conform to the rule. Defendants argue that this action should be dismissed because Plaintiff has not sufficiently alleged an injury in fact, a requirement for Article III standing. Additionally, Defendants argue this matter is not ripe for adjudication. Finally, Defendants argue that the lawyers whose rights may be potentially affected under Rule 16–308(E) are necessary and indispensable parties and Plaintiff's failure to join them in this proceeding mandates dismissal of this action under Fed.R.Civ.P. 12(b)(7).

Discussion

I. Legal Standard

Article III of the Constitution limits the jurisdiction of federal courts to cases and controversies. U.S. Const. art. III, § 2, cl. 1; Valley Forge Christian College v. Americans United for Separation of Church and State, Inc., 454 U.S. 464, 471, 102 S.Ct. 752, 70 L.Ed.2d 700 (1982). The case or controversy limitation requires that a plaintiff have standing. Lujan v. Defenders of Wildlife, 504 U.S. 555, 559–61, 112 S.Ct. 2130, 119 L.Ed.2d 351 (1992). The plaintiff bears the burden of establishing the elements of standing. Defenders of Wildlife, 504 U.S. at 559–61, 112 S.Ct. 2130. In deciding the issue of standing, the Court must accept as true all well-pleaded facts, and construe all reasonable allegations in the light most favorable to the plaintiff. Warth v. Seldin, 422 U.S. 490, 501, 95 S.Ct. 2197, 45 L.Ed.2d 343 (1975).

“In essence the question of standing is whether the litigant is entitled to have the court decide the merits of the dispute or of particular issues.” Warth, 422 U.S. at 498, 95 S.Ct. 2197. A plaintiff has standing when (1) she has suffered an injury in fact, (2) there is a causal connection between the injury and the conduct complained of, and (3) it is likely that the injury will be redressed by a favorable decision. Defenders of Wildlife, 504 U.S. at 559–61, 112 S.Ct. 2130. An “injury in fact” is an invasion of a legally protected interest that is concrete, particularized, and actual or imminent, not conjectural or hypothetical. Id. These three elements of standing are “an indispensable part of the plaintiff's case,” and thus the plaintiff must support each element “with the manner and degree of evidence required at the successive stages of the litigation.” Id.

Accordingly at this stage in the litigation, Plaintiff must plead the elements of standing in accordance with Bell Atl. Corp. v. Twombly, 550 U.S. 544, 127 S.Ct. 1955, 167 L.Ed.2d 929 (2007) and Ashcroft v. Iqbal, 556 U.S. 662, 129 S.Ct. 1937, 173 L.Ed.2d 868 (2009). “Threadbare recitals of the elements,” which are “supported by mere conclusory statements,” will no longer suffice at the pleadings stage. Iqbal, 556 U.S. at 678, 129 S.Ct. 1937. Plaintiff's claims for standing “do not require detailed factual allegations,” but must set forth “more than labels and conclusions, and a formulaic recitation of the element of a cause of action will not do.” Twombly, at 555, 127 S.Ct. 1955².

II. Plaintiff has Sufficiently Alleged an Injury in Fact.

The Tenth Circuit case of United States v. Colorado Supreme Court, 87 F.3d 1161 (10th Cir.1996), is on all fours with the instant case and the Court is bound by its holding. In Colorado Supreme Court, the United States brought an action for an injunction and declaratory judgment challenging two Colorado Rules of Professional Conduct which applied to all attorneys practicing in Colorado including federal prosecutors. Id., 87 F.3d at 1163. The challenged rules were Rule 3.3(d) and 3.8(f). Id. Rule 3.3(d) provided “In an ex parte proceeding, a lawyer shall inform the tribunal of all material facts known to the lawyer which will enable the tribunal to make an informed decision, whether or not the facts are adverse.” Id. Rule 3.8(f) provided that “a prosecutor in a criminal case shall ... not subpoena a lawyer in a grand jury or other criminal proceeding to present evidence about a past or present client unless” certain requirements are met, including that “the evidence sought is essential to the successful completion of an ongoing investigation or prosecution” and “there is no other feasible alternative to obtain the information.” Id. In addition, Rule 3.8(f) forbids a prosecutor from subpoenaing an attorney to present evidence about a client before a grand jury unless she “obtains prior judicial approval after the opportunity for an adversarial proceeding.” Id. The United States alleged the challenged rules “alter[ed] the nature of the federal grand jury, conflict[ed] with federal law, and interfere[d] with federal prosecutors in their conduct of criminal investigations and prosecutions.” Id., 87 F.3d at 1164.

Defendants in Colorado Supreme Court moved to dismiss Plaintiff's claims on the basis that Plaintiff lacked subject matter jurisdiction because Plaintiff had not alleged an injury in fact. Defendants pointed out that no federal prosecutor had ever been disciplined under these rules since their enactment. Id. The district court granted Defendants' motion to dismiss. Id. The district court held that the United States lacked standing because federal prosecutors had suffered no injury as a result of application of the rules. Id. Furthermore, the district court determined that federal prosecutors were not injured by changing their behavior to conform with the rules because such changes did not affect the attorneys' ability to prosecute cases and did not injure the attorneys personally. Id. In sum, the district court held that no case or controversy existed because the United States could not show actual or imminent injury in fact, and thus could not establish the injury element of the standing requirement. Id. The United States appealed the trial court's decision and the Tenth Circuit reversed. Id.

The Tenth Circuit held, “[t]he complaint in this case alleges that Colorado Rules 3.3(d) and 3.8(f) interfere with federal prosecutors in their conduct of criminal proceedings and change the nature of the federal grand jury in Colorado. These allegations are sufficiently ‘concrete and particularized’ and ‘actual or imminent’ to withstand a motion to dismiss.” Id., 87 F.3d at 1165. The Tenth Circuit squarely rejected the district court's suggestion that the United States could only establish standing by alleging disciplinary action had actually been taken under the challenged rules. Id., 87 F.3d at 1166 (citation omitted) (emphasis added) (stating “Parties need not ... await the imposition of penalties under an unconstitutional enactment in order to assert their constitutional claim for an injunction in federal court. Once the gun has been cocked and aimed and the finger is on the trigger, it is not necessary to wait until the bullet strikes to invoke the Declaratory Judgment Act.”). The Court also pointed to analogous cases in other circuits involving federal prosecutors challenging similar state bar rules where although the courts did not specifically address standing, they must have believed there was standing in order reach a decision on the merits. See id. (citing Whitehouse v. United States District Court for the District of Rhode Island, 53 F.3d 1349 (1st Cir.1995) and Baylson v. Disciplinary Bd. of the Supreme Court of Pennsylvania, 975 F.2d 102 (3d Cir.1992) and noting “[a]lthough the First and Third Circuits did not address standing when they decided cases very similar to this one, we must assume that those courts believed that the plaintiffs had standing as both courts proceeded to address their respective cases on the merits.”). The Tenth Circuit concluded, “[t]hus federal prosecutors need not risk disbarment by violating the Colorado Rules in order to challenge those rules in federal court.” Id.

Defendants' attempts to distinguish Colorado Supreme Court from the instant case are unpersuasive. Defendants first allege that Colorado Supreme Court is distinguishable because it also involved Rule 3.3(d) which concerned presenting exculpatory evidence to a grand jury. However, the Tenth Circuit...