New Jersey Court Rejects as Frivolous USET's Motion to Disqualify Attorney

Source :  USA Equestrian Inc.

After hearing lengthy oral argument, the Superior Court of New Jersey today
denied the motion of the United States Equestrian Team, seeking to
disqualify the attorney representing Alan Balch, who is challenging the
validity of various corporate actions taken by the USET in the fall of 2001.
Judge Edmund R. Bernhard also ruled that the motion of the USET was
unsupported by facts, was contrary to the law, and was frivolous. As a
result, he ordered that the USET and its attorneys must pay sanctions to
reimburse the legal fees incurred in opposing their motion. Mr. Balch is
the President of USA Equestrian, the National Equestrian Federation of the
United States, which authorized Mr. Balch to file the New Jersey litigation.


The USET's disqualification motion was filed by Armand Leone, Jr., the
President of the USET who is also acting as its attorney in the New Jersey
litigation. The motion was based on the fact that Mr. Balch's attorney,
Richard Collier, had successfully defended George Morris, Frank Chapot and
other trustees of the USET in a 1990 lawsuit. According to Mr. Leone, Mr.
Morris and Mr. Chapot are still trustees of the USET and therefore it would
be a conflict of interest for Mr. Collier to oppose the USET in the current
lawsuit.


Judge Bernhard rejected the arguments of Mr. Leone. He ruled that Mr.
Collier's representation of individual trustees in the 1990 case did not
mean that he was representing the USET in that case, and he noted that the
USET had its own attorneys in that case. Judge Bernhard also found that,
because there is no relationship between the 1990 case and the Balch action,
it is not a conflict of interest for Mr. Collier to oppose the USET in the
current litigation.


Finally, the Judge imposed sanctions on the USET, Mr. Leone, and Mr. Leone's
law firm for filing a frivolous motion after receiving a warning from Mr.
Collier that the demand for disqualification lacked any valid factual or
legal basis. The amount of the sanctions will be determined after Mr.
Collier submits an affidavit listing the legal fees incurred in defeating
the frivolous motion for disqualification.


Mr. Collier commented that the motion to disqualify him was an unfortunate
sideshow designed by the USET's attorneys to harass Mr. Balch and to delay
the New Jersey litigation. "In light of Mr. Leone's open gloating in the
media that the Federation 'is going to have legal bills going through the
roof' in this case, it is especially gratifying that Mr. Leone and his
client will end up paying my bills. This is what happens when a client is
not getting objective advice from an independent attorney, but rather
chooses to rely on an insider whose personal involvement distorts his
judgment."