Update: Late Thursday afternoon, Judge Johnson issued an order
denying Burr & Forman's motion for reconsideration. She did,
however, extend the deadline for Victor Hayslip's letter of
apology until Dec. 12 "in order to allow Mr. Hayslip the
opportunity to return from Canada and his dog
sledding excursion."
What do you do when a federal judge orders you to write a letter
admitting to misconduct you don't believe you've committed?
That's the quandary faced by Victor Hayslip of Burr &
Forman, who is supposed to file a letter of apology for
"inappropriate and unprofessional" conduct with U.S. District
Judge Inge Johnson of Birmingham, Alabama, on Thursday
afternoon. I told you earlier this week about all of the circumstances that led to Johnson's order, but to recap briefly:
Hayslip represents individual defendants in a securities class
action against Regions Financial. In November, he sent a letter
to U.S. District Judge William Duffey of Atlanta, who is
overseeing a securities class action against SunTrust Banks.
Duffey has scheduled a Dec. 18 hearing on allegations that the
plaintiffs' firm Robbins Geller Rudman & Dowd misrepresented
information obtained from a confidential informant in its
SunTrust complaint; Hayslip's letter asked Duffey to keep the
SunTrust hearing open to the public since there have been
similar allegations against the plaintiffs' firm in the Regions
class action.
Johnson, who's overseeing the Regions case, took grave
offense to Hayslip's letter. She concluded that he -- and not
Robbins Geller -- had misrepresented facts and behaved
unethically. On Tuesday, she ordered the Burr & Forman lawyer to
admit his misconduct and apologize to Duffey and to the 11th
Circuit Court of Appeals, which is considering an appeal of her
certification of the Regions shareholder class.
But Hayslip -- who is on vacation in Canada and wasn't
available to give his side of the story to Johnson at a status
conference on Monday -- doesn't think he did anything wrong when
he sent the letter to Duffey, according to a motion for reconsideration that his firm filed late Wednesday before
Johnson. In fact, according to the Burr & Forman motion, Hayslip
is ethically barred from admitting misconduct he does not
believe he engaged in.
"For Mr. Hayslip to admit he mislead Judge Duffey or the
Eleventh Circuit would be a violation of the rules of
professional conduct, and could potentially subject him to
disciplinary action, including disbarment," the Burr & Forman
motion said. "Mr. Hayslip has grave concerns because he feels he
cannot in good conscience write a letter admitting or asserting
that he made such misrepresentations, when in good faith he does
not believe that he did so." The motion argues that Johnson may
have misunderstood Hayslip's motive for writing to Judge Duffey;
he merely wanted to urge the judge to keep the Robbins Geller
hearing open to the public and, according to the motion, did not
intend to influence the outcome of the hearing in Atlanta or to
impugn the character of Robbins Geller's lead lawyer in both the
Regions and SunTrust cases, Andrew Brown. The Burr & Forman
motion asked Johnson to give Hayslip an opportunity to appear in
person to explain himself.
In a response filed Wednesday night, Robbins Geller avoided
discussion of Hayslip's ethical dilemma, arguing instead that he
has never offered a substantive explanation for why he disclosed
sealed deposition testimony from the Regions case in his letter
to Duffey -- and why he didn't tell Duffey that, in the Regions
case, Johnson did not credit defense assertions that the
plaintiffs had improperly used evidence from confidential
witnesses. If Hayslip had really wanted to defend himself,
Robbins Geller said, he should have returned from vacation to
appear before the judge at the status conference on Monday.
Johnson's order was issued at 4:40 on Tuesday afternoon, and
it gave Hayslip 48 hours to file a draft of his apology letter.
As of Thursday morning, Hayslip had not submitted the draft
letter but did reply to Robbins Geller's latest filing, once
again asking for a chance to appear personally before Johnson
and requesting a stay until he's defended himself. The whole
mess is now in the judge's hands.
(Reporting by Alison Frankel)
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