COMMITTEE ON CODES OF CONDUCT
ADVISORY OPINION NO. 52
Code of Conduct Does not Require a Judge to Disqualify in a Case
Where the American Bar Association or Some Other Open-Membership Bar Association
Is a Party.
A federal judge has inquired whether a judge should recuse in litigation
where the American Bar Association is a named defendant and the judge is
a member of the association. The Committee treats the inquiry as one generally
applicable to the situation where a national, state, or other bar association
is a party (either as plaintiff or as defendant) to litigation and the
judge is a member. The Committee assumes that the association in question
has an open membership.
The pertinent canons are 2A, providing that a judge "should act
at all times in a manner that promotes public confidence in the integrity
and impartiality of the judiciary," and 3C(1) reading:
(1) A judge shall disqualify himself or herself in a proceeding
in which the judge's impartiality might reasonably be questioned, including
but not limited to instances in which:
* * *
(c) the judge knows that . . . [he or she] has a financial
interest in the subject matter in controversy or in a party to the proceeding,
or any other interest that could be substantially affected by the outcome
of the proceeding.
Canon 3C(3) then goes on to provide:
(3) For the purposes of this section:
* * *
(c) "financial interest" means ownership of a legal or
equitable interest, however small, or a relationship as director, advisor,
or other active participant in the affairs of a party, except that:
(i) ownership in a mutual or common investment fund that
holds securities is not a "financial interest" in such securities unless
the judge participates in the management of the fund;
(ii) an office in an educational, religious, charitable, fraternal,
or civic organization is not a "financial interest" in securities held
by the organization;
(iii) the proprietary interest of a policy holder in a mutual insurance
company, or a depositor in a mutual savings association, or a similar proprietary
interest, is a "financial interest" in the organization only if the outcome
of the proceeding could substantially affect the value of the interest;
(iv) ownership of government securities is a "financial interest"
in the issuer only if the outcome of the proceeding could substantially
affect the value of the securities.
Professor E. Wayne Thode's Reporter's Notes to Code of Judicial
Conduct states, pp. 69-70: "[t]he 'financial interest' of a judge that
will disqualify him is his direct legal or equitable ownership interest,
no matter how small, in a party or in the subject matter in a proceeding
before him. The Committee was also of the opinion that active participation
by a judge in the affairs of a party should be treated in the same manner
as a judge's having a 'financial interest' in that party." See Thode,
Reporter's Notes to Code of Judicial Conduct 69-70 (ABA 1973). Observing
that a deposit in a mutual savings association or a policy in a mutual
insurance company constitutes a "technical legal interest," Thode further
states that "these technical interests, and other similar ones, should
not be a basis for disqualifying a judge even though the association or
company is a party to a proceeding before him." Id. at 71. Thode
concludes:
In Canon 3C(3)(c) the Committee endeavored to set a standard for
economic disqualification for indirect and technical interests that assures
impartiality and the appearance of impartiality but at the same time makes
available to a judge some types of nondisqualifying investments. Ibid.
In Advisory Opinion No. 26, relating to litigation involving health
insurance companies, the Committee concluded that a judge holding a Blue
Cross policy was not disqualified from sitting in a case where a Blue Cross
organization was a defendant. The judge's interest, it was felt, was not
a "financial interest," within the meaning of that term as it is used in
the Code. The interest was deemed to be analogous to the property interest
of a policy-holder in a mutual insurance company, or that of a depositor
in a mutual savings association, and that in any event, on the facts, the
interest could not be regarded as substantial.
In Advisory Opinion No. 49, relating to litigation involving trade
associations and a judge's ownership of a small percentage of the outstanding
publicly-traded shares of a corporation member of a trade association which
was a party, the Committee similarly concluded that there was no impropriety
in the judge's sitting on the case.
In each of these instances the Committee's conclusion, of course,
was subject to the general qualifications set forth in Canons 3C(1)(c)
and (3)(c).
In addition to the foregoing technical analysis of the canons,
and their intent and reach, and in addition to the precedents afforded
by Advisory Opinion Nos. 26 and 49, the Committee is of the view that unwarranted
recusal may bring public disfavor to the bench and to the judge himself
or herself. Where the provisions of the canons point to recusal, then recusal
must follow, but where the only factor present is supersensitivity on the
part of the judge, or a distaste for the litigation, or annoyance at a
party's suggestion that the judge recuse -- and nothing more -- the dignity
of the bench, the judge's respect for the fulfillment of judicial duties,
and a proper concern for judicial colleagues, all require that the judge
not recuse.
This principle, the Committee feels, is applicable to the bar association
situation presently under consideration. The judge's interest in a professional
organization of the bar association type is particularly tenuous, for the
"financial" aspect is inconsequential, and even if it could be said to
exist at all, it surely is no more than a "technical interest" that is
not disqualifying. The Committee, therefore, sees no impropriety in a judge's
sitting on a case where an open-membership bar association of which the
judge is a member is a party, so long as the judge has not participated
in the development of the bar association position on the matter in question
in the suit and is not an officer of, or on the governing board of, the
association. See Advisory Opinion No. 85.
Again, this conclusion is subject to the general qualifications
contained in Canons 3C(1)(c) and (3)(c).
This opinion relates only to the canons that constitute the Code
of Conduct for United States Judges. This Committee, of course, renders
no opinion on questions of law. Those interested, however, may note the
substantial identity of language of 28 U.S.C. § 455 with the canons
quoted above.
August 15, 1977
Revised July 10, 1998