Full opinion text
MEMORANDUM OPINION AND ORDER ROVNER, District Judge. This case is a securities action filed on January 29, 1983 by plaintiff Francis H. Wagner (“Wagner”) as a putative class representative against defendant Shearson Lehman Brothers, Inc. (“Lehman”) and defendant Stuart Travis (“Travis”) to recover losses incurred while Travis was employed by Lehman as a registered representative and while he acted as a broker for Wagner. Wagner’s complaint alleges that Travis churned his customers’ accounts at Lehman to generate commissions and purchased securities on their behalf without consideration for their investment objectives and financial resources. Lehman allegedly either participated in, knew, or should have known of Travis’s conduct but failed to supervise him properly. Wagner asserts that this conduct by Travis and Lehman violated Sections 10(b) and 20 of the Securities and Exchange Act of 1934, 15 U.S.C. §§ 78j(b), 78t, Commission Rule 10b-5, 17 C.F.R. § 240.10b-5, and the Racketeer Influenced Corrupt Organizations Act (“RICO”), 18 U.S.C. §§ 1961-1964. He also asserts pendent state claims of fraud and breach of fiduciary duty. Wagner’s claims against Travis and Lehman are brought on his own behalf and as representative of the putative class of former Lehman customers whose accounts were handled by Travis while he was employed at Lehman from 1971 through 1982. A flurry of motions were filed after the complaint, including a motion for class certification, two motions to disqualify plaintiff’s counsel, a motion to substitute the executor of Wagner’s estate as the class representative after Wagner’s death, a motion to dismiss the complaint for Rule 11 violations, and a motion to impose Rule 11 sanctions against Lehman for filing one of the motions to disqualify counsel. The two motions to disqualify plaintiff’s counsel are based on separate and independent facts. On May 2, 1983, Lehman filed its Motion to Dismiss and Disqualify Plaintiff’s Counsel on the grounds that this action was improperly brought based upon information gained by Wagner and his counsel, Steven Gomberg (“Gomberg”), from Travis in return for a false promise of payment of money. On May 13, 1985, Lehman filed its Motion to Disqualify Plaintiff’s Counsel based on: (1) the conflict of interest existing in the representation of plaintiff by his counsel, Ronald Kane (“Kane”), given Kane’s substantial responsibility while employed by the Securities and Exchange Commission (“the SEC”) for an investigation of defendants concerning Wagner’s claims conducted by the SEC; and (2) the impropriety of Kane’s conduct in contacting employees of the SEC, after he left its employ and appeared as plaintiff’s counsel in this action, in an attempt to persuade the Commission to initiate an investigation of defendants. An evidentiary hearing was conducted from December 10 to December 16, 1985. Following the evidentiary hearing, the parties were instructed to prepare Proposed Findings of Fact and Conclusions of Law and to brief the motions. For the reasons stated below, this Court has decided to: grant the motions to disqualify plaintiff’s counsel, Gomberg, Kane, and their law firm; deny the motion for class certification; deny the motion to substitute Lee Barbakoff, the executor of Wagner’s estate, as the class representative; deny plaintiff’s Rule 11 motion for sanctions; and deny the Rule 11 motion to dismiss the complaint. FACTS I. Genesis of this Lawsuit — Travis’s Taped Statements. Approximately 18 months after he had closed his account with Lehman, on November 22, 1982, Wagner received a telephone call from Travis. Travis proposed that Wagner could recover the losses he had sustained in his account, allegedly in excess of $1.2 million, by suing Lehman for “misinformation, mismanagement and churning.” (Wagner Dep. at 6-9.) Travis stated that he would give testimony to support those claims in exchange for 15 to 20 percent of any sum ultimately recovered by Wagner from Lehman. He further stated that no one was to know about their proposed financial arrangement and that if asked about it, he would lie. Travis indicated to Wagner during this conversation that he was emotionally depressed, that he was “finished” in the brokerage business, and that he was in dire financial straits. (Wagner Dep. at 10.) On November 23, 1982, the next day, Wagner contacted his attorney, Steven Gomberg of the law firm of Siegan, Barbakoff, Gomberg, Gordan & Elden, Ltd. (“the Siegan, Barbakoff firm”). Gomberg told Wagner to prepare notes of his conversations with Travis and to gather his trading records with Lehman. Wagner was a self-made millionaire who invested extensively in the stock market. He began investing in stock in 1967. He engaged in a wide variety of securities transactions with numerous brokerage companies, sometimes simultaneously, and he monitored all of his transactions carefully. Travis was employed by Lehman from December, 1970 to February, 1982. Travis first contacted Wagner by phone in October, 1975, and as a result of that contact, Wagner opened two accounts with Lehman, a cash and margin account and an option account. On his New Account Form, Wagner indicated that at that time he had a net worth of $5 million and a portfolio valued at $4 million. Wagner maintained his accounts with Lehman until April, 1981. During that time he purchased the securities of more than 60 corporations and traded heavily in more than 70 options. He profited by approximately $516,944 in his stock transactions, but he lost approximately $1,132,887 in his options trading. Wagner testified at his deposition that he had no personal knowledge of any wrongdoing by Lehman other than what Travis had told him. Two days after the November 22, 1982 conversation, Travis called Wagner again to see whether Wagner had “started proceedings.” (Wagner Dep. at 27-29.) Travis told Wagner that Lehman knew he was a “pathological compulsive gambler” before he started trading for Wagner and had sent Travis to a psychiatrist. (Wagner Dep. at 29-32.) When Travis learned that no lawsuit had yet been filed, he again told Wagner to sue Lehman. In this conversation, Travis suggested that Wagner and his attorney should come to New York where Travis would go over “everything” and would “testify” on his behalf. (Wagner Dep. at 32; Wagner's notes at 5.) Travis told Wagner that if asked his reasons for this testimony, he would: ... answer by saying that he wants to do one last good favor for me. He will also say that he has remorse, wants to repent, and ... a born again Christian. (Exhibit I at 6.) In this second telephone conversation, Travis for the first time asked Wagner for an immediate payment of $20,000 to “hold him over.” (Wagner Dep. at 33.) Wagner’s response to this immediate request for funds was “to give the impression that I would do everything in my power to help him — .” (Wagner Dep. at 34.) Accordingly, Wagner told Travis that he would “try to raise the money for him.” (Wagner Dep. at 35.) Travis then stated that when the suit was settled, he wanted Wagner to give the money to his wife, and Wagner and Travis discussed how this could be done “without raising suspicion.” (Exhibit I at 6.) Following his conversations with Travis, Wagner and Gomberg met with a representative of the United States Attorney’s office in Chicago, to whom they conveyed the Travis story. Wagner was then referred to the United States Attorney’s office in New York, where Travis resided. Wagner and Gomberg met with an Assistant United States Attorney and an FBI agent in New York on December 2,1982, at which time the Assistant and the FBI agent proposed that Wagner wear a concealed recording device to meet with Travis. Wagner agreed to this proposal. During this meeting, Wagner requested an opinion as to whether anything he was doing was illegal. The Assistant United States Attorney assured Wagner that it was not. Accordingly, Wagner and Gomberg met with Travis at his home on December 3, 1982. As noted above, prior to this meeting, Wagner had a recording device affixed to his body by two FBI agents. Upon his arrival at the Travis home, Gomberg absented himself from the room. (FBI Transcript at 13.) Wagner then confirmed with Travis the “payment” arrangements they had previously discussed. Although Wagner apparently had no intention of paying Travis any money, he did attempt to induce testimony favorable to his case. Thus, the following exchange took place: Wagner: ... our understanding now is the fact that we get this thing going— I’ll definitely take care of you on this one. ****** Travis: I don’t know if I can make it — I got $400 left. Wagner: Now listen, I’m working on this 20 grand. Travis: I don’t need twenty, I need ten. I haven’t paid my f_bills for two months, so I can hang, pal. But, if I can’t have it in six months, Frank, I’ll sign you a note for that. Trust me. Wagner: I trust you. I trust you. (Exhibit J at 14, 16.) Once this arrangement was confirmed, Travis proceeded to talk with Wagner and his attorney about his alleged mismanagement of his customers’ accounts. Partway through the December 3 meeting, Gomberg persuaded Travis to permit an open tape recording of the proceedings. Travis consented to this “open” tape only after Gomberg promised that he would not “use that [tape] in court” and that Gomberg would give the tape to Travis if Wagner did not proceed with the lawsuit. (Exhibit J at 19, 25.) From the beginning of their meeting, Gomberg knew that Travis was represented by counsel, but nevertheless allowed the meeting to continue. During the ensuing conversation, Travis proceeded to tell Wagner and Gomberg that he suffered from a gambling addiction of which Lehman was aware and which caused him to trade heavily in customers’ accounts for the sole purpose of generating large commissions. According to Travis, because of his need to earn large commissions, he never concerned himself with the suitability of particular investments for his customers. Rather, he placed high concentrations of the same security in accounts and then churned those accounts until they were wiped out. Travis stated that Lehman knew of Travis’s gambling addiction, sent him to a psychiatrist, took control over Travis’s personal finances, but allowed him to continue handling accounts. Travis also repeatedly referred to his desperate financial situation. He told Wagner, “I’m going bankrupt. I’m very sad. I can’t pay my mortgage.” (Exhibit J at 24.) Travis elaborated on his troubles as follows: I mean, I’m in debt now for a million dollars. I’m personally in debt now for a million dollars. I’m about to go bankrupt. I’m in debt, I’m overdrawn on my checking account $166,000 in Chemical Bank, okay, from horses. ****** If you decide to sue me, fine, sue me. I’m judgment proof. I’m broke. I have no money. I’m on my last vestiges. My . assets are in my pocket, $400. I went to the track yesterday, blew my last $8,000. (Exhibit J at 41, 50.) Travis also confessed that he “owe[d] a shylock $30,000.” (Exhibit J at 99.) In addition, Travis made a variety of statements that clearly revealed his troubled mental state. Thus, he told Wagner and Gomberg: Ah, I just feel the pressure’s getting to me and I may be ready for a nervous breakdown____ (Exhibit J at 28.) Towards the end of the meeting, Travis repeated: I will tell you the reason I’m doing this is to get it off my chest because I’m about to have a nervous breakdown. And my wife’s very uptight because to be candid with you, as bad as I might sound, I am. (Exhibit J at 73.) Travis also assured Gomberg that his motives for testifying were pure and that no financial incentives were involved. At the beginning of the meeting, while Gomberg was in the bathroom, Travis told Wagner that he would tell Gomberg that “there’s no arrangement between us, none whatsoever.” (Exhibit J at 18.) Gomberg, of course, was aware of the financial incentives from the outset. According to plan, therefore, Travis immediately told Gomberg that “there’s no money coming between me and Frank.” (Exhibit J at 21.) Instead, Travis stated: ... the reason this meeting’s taking place is that Frank had said he was thinking of suing Lehman Brothers and he would like, you know, the truth about the handling of his account prior and ..'. I feel telling this will make me feel a little bit better. (Exhibit J at 28.) Travis repeated-the theme that the meeting was taking place at Wagner’s request and because of Travis’s concern for Wagner: [Y]ou came to me, you wanted to sit down and talk to me before you sue Lehman. You wanted to know my feelings on how I handled Frank’s account. I am telling you candidly, I let you come to my house because I felt bad cause Frank is absolutely dying. Physically he looks much better, but he’s been very sick. And there was a time that he thought he wouldn’t make it, and this was his life savings. When a guy tells me that, I’m sensitive enough to say “Frank, let me tell the truth.” When he called me, he said, “Stu, is there anything you could say?” I said “Frank come to my house with your lawyer. I will tell the truth.” # sfc sfc $ * * I want you to know I did not call Frank to do this. I want you to know I did not tell Frank to do this. I want you to know Frank called me. And he said, “Stu, I’ve looked over all the trading through the years and I’ve got to tell you I’m sick about it because my whole life savings is down the drain.” He said, “I’m thinking about suing you. Don’t take it personally.” I said, “Frank, bring your lawyer to my home and I will tell you the truth from top to bottom.” That’s how this all — this is not — I’m not being paid for this, I don’t want anything from it. (Exhibit J at 81-83; emphasis added.) At the end of the meeting, Gomberg told Travis that he was a “sick guy” who had “impeached [his] own credibility” and whose reputation was “worthless” (Exhibit at 97, 102, 114). Travis asked Gomberg his opinion on the value of his story to foree a rapid settlement: Travis: ... Now, how, how hot is this? Gomberg: I think there — I think it’s a fall down. I don’t even think I have to file suit. I figure if I walked in there and said “Here, I want you to listen to a song,” I think they’d fall over dead. I think they're open for a class action. I think they’re open for racketeering, federal racketeering charges as well as the normal security charges. I think they’ve had the most profitable quarter in history. (Exhibit J at 94.) Gomberg’s mention of a possible class action against Lehman obviously troubled Travis because he stated: ... well, you’re bringing class action. I mean, we’re going to get this out of whack. I mean, we don’t want to — if you can settle with them, wouldn’t it be better? (Exhibit J at 102.) Gomberg reassured Travis that a quick settlement was what he was interested in as well: Well, class action, I don’t want to try a class action. It’s costly. It takes a — I want to settle. I want a quick — I want this thing to be settled within six weeks. (Exhibit J at 103.) Gomberg went on to reassure Travis that he was “not interested in any other customers. I’m interested in Frank.” (Exhibit J at 109.) Travis wanted to know “How long you think before you go to Lehman?” (Exhibit J at 100.) Gomberg replied that he would approach Lehman around the first of the new year. Travis also asked what Lehman’s reaction would be when Gomberg played the tape of the December meeting for Lehman’s attorneys, to which Gomberg responded: Gomberg: I think they’re going to fall right down. I think — I’m going to say, you pay a million and half now, or I’ll file suit. They’ll be initial notoriety. The Journal will pick it up. Everyone else will pick it up. Someone’s ready to jump on Air Florida. As a matter of fact, I’ve got another case ready to go up— Travis: Forget about that. I gave you more information that you could — I don’t know if I’m right on that. Gomberg: Okay. Well, you haven’t said anything that hasn’t been presumed by others. “Either you’re willing to pay the 1.5 or whatever the figure is now or”— Travis: Oh, it’s going to be bigger. Gomberg: —“or it’s going to be treble damages. It’s going to be a class. It’s going to be — I’m going to go after every customer you ever had and I’m going to pull ’em into this thing.” And we’re talking about forty or sixty million, or whatever. Now it’s up to them____ (Exhibit J at 106-107.) The December 3, 1982 meeting was concluded after Travis and Gomberg agreed to meet at Travis’ attorney’s office so that Gomberg could question Travis further before a court reporter. After the December 3, 1982 meeting, Travis called Wagner repeatedly to press him to obtain a quick settlement: “Travis was extremely — repeated many, many times about the possibilities of a quick settlement in this case____” (Wagner Dep. at 154.) Indeed, at one point Travis “went into a hysterical tirade” and said “he was finished ... and he felt he might as well commit suicide.” Wagner continued to lead Travis to believe that he “was doing everything he could to help him.” (Wagner Dep. at 159, 163-64.) Accordingly, Travis asked Wagner to “get a hold” of Gomberg to arrange the second session before the court reporter quickly. That session took place in New York at the office of Travis’s counsel on December 17, 1982. During the December 17, 1982 session, Travis reiterated in large part the statement he gave to Wagner and Gomberg at his home on December 3,1982, although he “toned it down” somewhat. Lehman, of course, was never advised that this session before a court reporter was taking place and was never given the opportunity to attend and cross-examine Travis. Travis never signed the transcript of this statement. Consistent with his desire to effectuate a “quick settlement” for Wagner, on January 6, 1983, Gomberg telephoned Saul S. Cohen, then General Counsel of Lehman, and explained that he was in possession of tapes of various conversations with Stuart Travis which he proposed to play for Mr. Cohen in an effort to “settle” the case. Mr. Cohen declined this suggestion, stating that he had no interest in Mr. Gomberg’s proposal. In his affidavit, Mr. Cohen recounts that he was deeply offended by “what appeared to ... [him] to be an attempt by Mr. Gomberg to sell the tapes to Lehman Brothers.” Wagner subsequently filed this lawsuit against Lehman on January 25, 1983. Travis was also named as a defendant. Despite being named as a defendant in the lawsuit, Travis continued to telephone Wagner after January, 1983, still blind to the fact that Wagner’s promises of financial compensation were false. Wagner at this point “had purposely put a policy in effect to avoid taking any calls from Mr. Travis any further.” (Wagner Dep. at 250.) On one occasion, however, he was unable to avoid the call, but told Travis that he was “not going to talk to [him] any further.” (Wagner Dep. at 251.) At this point, Travis: ... just absolutely blew his stack. And he said, “Now wait a second.” He said, “I am getting very” — these are all words to this effect — “I am getting very uptight about this whole thing.” He said, “If you and your lawyer are thinking of hanging me out to dry ... you got another guess coming.” ****** ... he said, “Make up your mind; that if you don’t cooperate with me, [n]either you or anybody else are going to get a penny out of this.” (Wagner Dep. at 251-52.) Wagner testified that his final conversation with Travis took place in April, 1983. In this conversation, Travis said, “Frank, Frank____ We lost.” (Wagner Dep. at 254.) Wagner replied, “What do you mean, we lost?” Travis responded: “You lost, I lost.” He said “We all lost.” He said, “They taped us both.” With that, I put the phone down. That was the last of any conversation I had with Travis. (Wagner Dep. at 254.) II. Ronald Kane’s Involvement with the SEC Inquiry of Travis and Lehman. On January 26, 1983, one day after Wagner filed this action, the Securities & Exchange Commission’s (“SEC”) Chicago Regional Office (“CRO”) initiated a Matter Under Inquiry (“MUI”) regarding Travis, designated MC-303. The SEC learned of this lawsuit through an article in the Chicago Sun Times. As the MUI Opening Form indicates, Stuart Travis was the subject of the inquiry, and Lehman was designated a “related party” to the investigation. MC-303 was assigned to Thomas Huber, then a CRO staff attorney in one of the two enforcement branches under the supervision of Ronald P. Kane, an Assistant Regional Administrator (“ARA”) for enforcement matters in the CRO. Kane held this position throughout the period of the SEC’s investigation of Travis and the allegations in the Wagner complaint. After opening MC-303, on January 26, 1983, Huber contacted Gomberg, informed him that the SEC had opened an inquiry concerning Travis, and asked for a copy of the complaint in this case. By letter of the same date, Gomberg provided a copy of the complaint to Huber. According to William Góldsberry, Regional Administrator of the SEC’s Chicago office, in his capacity as ARA Kane supervised Mr. Huber and was charged with responsibility for the inquiry of Travis and Lehman. Because Kane was Huber’s supervisor, Kane had official responsibility for the matters assigned to Huber which were subject to Kane's supervision. Although MC-303 was a relatively insignificant matter under inquiry in the SEC’s CRO, the entire investigation of which took approximately 24 hours of SEC attorney time, it was nevertheless significant enough to warrant inquiry within the SEC's auspices. It is undisputed that Kane personally participated in two quarterly case reviews as part of his supervisory responsibilities. The purpose of the quarterly case reviews was to “ascertain what [the staff] had done since the date of the last case review ... where they were going with the case, and what they planned on doing in the next several months.” (Goldsberry Tr. at 15; Kane Tr. at 4.) Apparently no one who was present at these case reviews recalls what was discussed or the length of the discussion, although based on the number of matters discussed during each review, each discussion on MC-303 probably lasted no more than five minutes. Based on Kane’s notes of the case reviews, which he had typed, circulated, and placed in a three-ring binder, during the first meeting, Kane concurred in a decision to continue monitoring the private action, and, during the second meeting, Kane concurred in a decision to close the matter. Accordingly, the Court finds that Kane took part in the SEC’s deliberative process regarding MC-303 and thus personally and substantially participated in MC-303. Although there is some dispute as to the extent and nature of the confidential, nonpublic information concerning defendants either engendered by or disclosed to the SEC by the MC-303 inquiry, this Court finds that such information was disclosed to the SEC by counsel for Lehman pursuant to an agreement that it would be kept confidential. Even if Kane did not receive this information directly, there is no dispute that he had access to it merely by going to the SEC file on MC-303 or by asking Mr. Huber. On Friday, October 19, 1984, Kane resigned from the CRO to enter private practice with the Siegan, Barbakoff law firm. Three days later, on Monday, October 22, 1984, he filed his appearance in this action on behalf of Wagner and his firm. Less than one month before he resigned from the SEC, Kane knew or should have known that the SEC had some interest in this case, a case on which he knew he would be working when he entered private practice with the Siegan, Barbakoff firm. Shortly after Kane announced that he would join that firm, Stanley Whitten, the CRO’s chief investigator who reported to Kane and who was and is a personal friend of Kane’s, received a partial copy of the complaint in this action from an employee of the United States Postal Criminal Investigation Service. Within a day or two of receiving the Wagner complaint from this employee, Whitten told Kane that he had been given a copy of a complaint filed by the very law firm which Kane had announced he would be joining upon leaving the SEC. Whitten told Kane that the complaint had “mysteriously” appeared on his desk and “here you [Kane] haven’t even left the Commission, and you are already at work with your new law firm.” (Whitten Tr. at 465.) Kane admitted to Whitten that the complaint had been filed in a case on which he would be working when he left the SEC. Despite this conversation, Kane did not attempt to determine whether the CRO was or had been investigating the facts of this case. Before Kane left the SEC, he and Gomberg had discussed his joining the Siegan, Barbakoff firm on six occasions and discussed the cases on which Kane would be working when he would join the firm. Although Gomberg denies that he was aware that the SEC had been investigating this matter, this Court finds that Gomberg knew or should have known of that inquiry. Huber so informed him as early as January 26, 1983; he sent Huber a copy of the complaint in this case; and Lehman’s counsel referred to an ongoing SEC investigation into the facts of this case no fewer than six times during a hearing before Judge Grady of this Court on May 11,1983. Despite this knowledge, Gomberg made no attempt to determine whether Kane was involved in the SEC inquiry of the circumstances of this case. Nor did Kane advise Gomberg of the matters on which he had worked while employed by the SEC except for a criminal proceeding on which he had spent substantial time and in which Kane had been appointed Special Assistant United States Attorney. Although both Kane and Gomberg explain this failure by pleading a lapse of memory, after having observed the demeanor of these witnesses at the hearing, this Court finds that explanation to be inherently incredible. This conclusion is strengthened by Kane’s contacts regarding this matter, Lehman, and Travis with the SEC after he joined the Siegan, Barbakoff firm. Within a week of joining that firm, Kane began an effort to encourage the SEC to investigate Travis. Kane had at least 14 contacts with his friends and former associates at the SEC regarding Travis, Lehman, or Travis’s current employer, the firm of D.H. Blair in New York. Gomberg was fully aware of Kane’s subsequent contacts with the SEC. Kane's first contact with the SEC was on the morning of October 24, 1984, when he telephoned Anne Flannery, Assistant Regional Administrator of the SEC’s New York Regional Office. He told her he was a former CRO employee and counsel for plaintiff in an action against Travis and Lehman and that he had received information about possible securities law violations by Travis at D.H. Blair. The second of Kane’s series of contacts with SEC employees regarding defendants was in late October 1984, when he telephoned his friend in the CRO, Stanley Whitten, to arrange a lunch. Kane told Whitten that he wanted to discuss a situation that might be of enforcement interest and that had come to Kane’s attention as a result of a case on which he was working. Kane and Whitten had lunch on November 1, 1984. At the lunch, Kane discussed this litigation and related to Whitten that: ... he was working on a case involving an individual ... name[d] Wagner ... gave me basically an overview of the case he was working on and indicated that in the course of working on this case that some information had come to his attention that Stuart Travis was apparently involved currently ... in what appeared to be ... violations of the Federal Security (sic) laws in his employment of D.H. Blair, and that this actually had come to him as a result of some informant that had provided him some information. It was my understanding the information was written ... and that in his view it would be really a very interesting enforcement matter. ... he had a yellow legal pad piece of paper in which he had five, I think it was, stocks written down and two names of individuals who ostensibly were nominees for Mr. Travis. And he explained to me that the information he had received was that these five stocks were being manipulated by Mr. Travis at D.H. Blair and that in conjunction with that manipulation of these stocks, that these two names were being used as phony accounts there____ (Whitten Tr. at 467-68; emphasis added.) Whitten added that Kane allegedly told him the Wagner case would not be of interest' to the CRO because it only involved one individual and the facts were too old. (Whitten Tr. at 468.) Kane gave Whitten a handwritten piece of paper that listed four or five stocks and two nominee accounts involving Stuart Travis and D.H. Blair. The stocks listed allegedly were being manipulated by Travis at D.H. Blair through the use of the very same nominee accounts that Wagner alleges were used by Travis to manipulate the market while he was at Lehman. Thus Mr. Kane testified: It is true we had been given information from the informant that he [Travis] was using nominee accounts at D.H. Blair and the informant told us he thought he had been using the same nominee accounts at Lehman Bros. (Kane Tr. at 211; emphasis added; see also Kane Tr. 211-12, 213.) Kane also told Whitten that Travis was engaging in conduct at D.H. Blair similar in nature to the conduct that he had engaged in while employed at Lehman. (Whitten Tr. at 470; Kane Tr. at 206-08.) Kane subsequently admitted in a pre-trial conference before this Court that it would be “helpful” to Wagner to show that Travis was using the nominee accounts at D.H. Blair to manipulate the market and that he used these same accounts at D.H. Blair for the same purpose: We had also been given information that Mr. Travis had previously at Lehman Brothers used nominee accounts to personally benefit from the way he traded Securities and that he was using the same nominee accounts at D.H. Blair. We have never been able to pin down the nominee accounts at Lehman Brothers, but it would be helpful to us to see if we could get that information from Blair. (Tr. of Pre-trial Conference, Dec. 9,1985, at 38; emphasis added.) Later in the day of his November 1, 1984 luncheon with Kane, Whitten entered Travis’s name into the SEC computer to determine whether “there had been any prior interest in Mr. Travis by the Commission.” (Whitten Tr. at 473.) After entering Mr. Travis’ name into the computer, Whitten discovered that an inquiry regarding Travis, designated MC-303, had in fact been pending in the Chicago Office and was closed in January, 1984. Because Whitten’s discovery of the existence of MC-303 led him to question whether it concerned Wagner, he went to the file room and pulled the Closing Memorandum for MC-303, and determined it was a recommendation from Huber and Kane to close the inquiry. Whitten immediately telephoned Kane and said: “Ron, I’ve looked into some of the information that you gave me,” and I said, “I would like to tell you that Stuart Travis and his Lehman Brothers activity I found very interesting because here at lunch you were telling me what a great case you were working on.” And I said, you know, “How quickly you’ve changed since your (sic) gotten into private practice.” I said, “when you were at the Commission this case was a big nothing, as evidenced by the fact that I found a closing report in the — in the file room that indicated that it was closed by you.” (Whitten Tr. at 478-79; emphasis added.) Whitten’s discovery caused Kane quickly to focus on his potential conflict of interest. Kane admitted that he was “concerned” about Whitten’s discovery. (Kane Tr. at 169.) Kane then told Whitten that he was out of the office in January, 1984, and asked Whitten to check the Closing Memorandum for its date. After doing so, Whit-ten telephoned Kane to say that it was dated January 24, 1984 and that Kane’s initials did not appear on the memorandum. Kane then indicated he had been in St. Louis on that date. By this time, Whitten also had focused on Kane’s potential conflict. Kane then told Whitten that to “play it safe,” he was going to call Mr. Goldsberry regarding the matter. (Whitten Tr. at 483.) Kane never did so. Kane had additional reason to question the extent of his role in MC-303. Following his two telephone conversations with Kane on November 1, 1984, Whitten related the substance of his conversations with Kane to Joyce Glynn, Kane’s successor as ARA, who, during the pendency of MC-303, had been the branch chief of the enforcement branch to which Huber was assigned. Whitten told Glynn that after his lunch with Kane concerning Travis, he had returned to the office and “found that it was a matter that had already been looked at by the Chicago Regional Office and closed,” and that Kane had expressed “concern” about the matter. On the next day, November 2, 1984, Ms. Glynn checked Kane’s records to determine whether he had discussions with anyone concerning MC-303 and discovered “during at least two of the case reviews that Mr. Kane was responsible for ... had discussed Stuart Travis MC-303.” (Glynn Tr. at 418; Kane Tr. at 168.) Ms. Glynn then telephoned Kane because she thought he might be interested in the information in deciding what action to take. Glynn also informed Kane at this time that he had taken notes during the November, 1983 case review which reflected that the investigation was “to be closed.” (Kane Tr. at 168; Glynn Tr. at 420.) Kane made no attempt whatsoever to address the potential conflict with either the SEC, counsel for defendants, or this Court even after he received all this information regarding his role in MC-303. Instead, he and Gomberg met and allegedly determined themselves that there was no conflict of interest. Kane had several subsequent contacts, both with Whitten and with Richard V. Norell, a friend and former supervisor of Whitten’s in the SEC’s Washington Office, to whom Whitten had referred Kane. Kane had lunch with Norell in Washington, during which he gave him the same information he had given to Whitten, including the allegation that Travis was using the same nominee accounts at D.H. Blair that he had purportedly used at Lehman. He also provided him a copy of the transcript of the FBI tape of the December 3, 1982 meeting. On February 26, 1985, Judge Broderick of the United States District Court for the Southern District of New York quashed a subpoena Kane had prepared and served upon D.H. Blair. That subpoena asked for, inter alia, Travis’s Form U-4, the Uniform Application for Securities Industry Registration form. A U-4 form lists background information about a registered representative. Kane had called Whitten prior to preparing the subpoena to ask “how to accurately describe a broker/dealer document” for the subpoena. (Whitten Dep. at 252-54, 514-15.) Judge Broderick ruled that the documents sought were irrelevant to this case. After a few more incidental conversations with Kane regarding Travis, Whitten spoke with Norell of the SEC’s Washington Office about Travis. During this conversation, Whitten informed Norell that he might be going to D.H. Blair on a matter completely unrelated to the Travis matter, and that if he had not taken a look at the D.H. Blair records with respect to the material “that Mr. Kane had brought to his attention,” that Whitten would be more than happy to do it. (Whitten Tr. at 513.) On March 14, 1985, Whitten visited D.H. Blair’s offices in New York and obtained a copy of Travis’s U-4 form, one of the very documents to which Kane had been denied access by Judge Broderick on February 26, 1985. That same evening, Whitten met Norell for dinner and provided to him a copy of Travis’s U-4 form and also the names of the three individuals to contact provided to Whitten by D.H. Blair. The next day, Whitten contacted another SEC employee, Thomas Valery of the SEC’s New York Office, regarding either Travis, D.H. Blair, or Lehman. On March 18, 1985, the SEC opened its investigation of Travis. Kane received a telephone call on the day after Whitten appeared at D.H. Blair from Richard Hoskins, Travis’ counsel, who had learned of Whitten’s visit to D.H. Blair and telephoned to ask Kane whether he had had any contact with the SEC regarding Travis. Kane flatly denied having had such contacts. Kane told Hoskins unequivocally that “there have been no contacts and certainly none today between this office and the SEC that has anything to do with your client [Travis].” (Hoskins Tr. at 128.) Hoskins made a contemporaneous memorandum of his telephone conversation with Kane on March 14. (Defendants’ Exhibit 6, Memorandum to File dated March 15, 1985.) As noted above, Kane had had numerous contacts with Whitten, Norell, Glynn, and Flannery, two of which had occurred only one to two weeks earlier. Kane testified, however, that Hoskins asked him only whether he or anyone at his firm were having discussions with the SEC and that he replied that his firm was, to the best of his knowledge, having no “ongoing” discussions with the SEC. (Kane Tr. at 133-34.) This Court finds Kane’s testimony on this point to be not credible. After a few more contacts between Kane, Whitten, and Norell, the SEC commenced an inquiry concerning Travis in its New York office on March 18,1985, following Whitten’s visit to D.H. Blair. As a result of the SEC’s inquiry and some recent adverse publicity concerning Travis, Travis resigned from D.H. Blair’s employ after working for D.H. Blair for over one year, during much of which time he was in charge of D.H. Blair’s sales force. Lehman’s counsel first became aware of Kane’s prior employment with the SEC in late January, 1985, upon receipt of the transcript of the hearing before Judge Grady on January 4,1985 concerning Wagner’s class certification motion. That transcript mistakenly gave as Mr. Kane’s current employment his former position with the SEC. After learning that Kane had served as ARA for enforcement matters at the CRO, Lehman’s counsel attempted to determine whether Kane had had any involvement with the earlier investigation of Lehman, Travis, and Wagner undertaken by the SEC, in which Lehman had cooperated. The precise details of their efforts in this regard are the subject of Wagner’s Rule 11 motion for sanctions, but they need not be recounted here except to note that neither Kane nor Gomberg voluntarily cooperated with that effort. Indeed, Kane’s responses in this regard can be charitably characterized as evasive. On May 15, 1985, defendants filed a second motion to disqualify, this time seeking to disqualify Kane and the Siegan, Barbakoff firm as a result of Kane’s prior employment by the SEC and involvement in MC-303. Wagner’s Rule 11 motion for sanctions against Lehman and its counsel, Michael Coffield and David Carden of the law firm of Coffield, Ungaretti, Harris & Slavin, soon followed. Finally, on May 24, 1985, Wagner, the named plaintiff in this case, died. On June 13, 1985, Lee R. Barbakoff, Wagner’s personal attorney and a named partner in the Siegan, Barbakoff firm, was appointed executor of his estate. On September 4, 1985, Gomberg and Kane filed a motion to substitute Mr. Barbakoff as a party plaintiff and class representative in this case. DISCUSSION Lehman contends that Gomberg and Kane and the Siegan, Barbakoff firm, should be disqualified on two separate bases: first, Gomberg’s and Wagner’s conduct regarding the December 3 taping of their meeting with Travis and the ensuing activity leading to the filing of this lawsuit violated at least two disciplinary rules of the ABA Code of Professional Responsibility as well as Rule 11 of the Federal Rules of Civil Procedure; and second, Kane’s conduct in representing the plaintiff in this case, given his involvement with the SEC’s inquiry about this matter, violated the ABA disciplinary rules, the SEC’s rules, and a criminal statute. Each of these bases, as well as the related issues of the impact of this conduct on the class certification and Rule 11 motions, will be discussed below. I. Disqualification For Conduct Relating to the Origin of this Case. Although Gomberg’s conduct from the inception of this case and throughout the subsequent proceedings is sufficient in itself to require disqualification, this Court is particularly concerned by his role in the December 3, 1982 tape recorded meeting between himself, Wagner, and Travis. After a review of all the facts, this Court concludes that he has violated at least two of the disciplinary rules of the ABA Model Code of Professional Responsibility and of the Illinois Code of Professional Responsibility, Ill.Rev.Stat. ch. 110A, Rules 1-101 to 9-102 (1981). DR 7-109(C) provides in pertinent part: A lawyer shall not pay, offer to pay or acquiesce in the payment of compensation to a witness contingent upon the content of his testimony or the outcome of the case. Wagner’s promise to remit up to 20% of any of his potential recovery in this case to Travis for his testimony was contingent upon the outcome of this case. There is no question that Gomberg, at the least, was aware of this arrangement between Wagner and Travis even before the taping of the December 3, 1982 meeting began. Indeed, he prearranged with Wagner to absent himself from the room for a short time so that Wagner and Travis could discuss the financial arrangements. Thus, Gomberg clearly violated DR 7-109(C). Wagner responds briefly in Gomberg’s defense by raising two points. First, he asserts that neither Gomberg nor Wagner ever intended to pay Travis any money for his testimony. It makes no difference that Gomberg and Wagner never intended that money actually change hands because the effect on the potential witness is the same: he is induced by the promise of potential payment to give testimony he otherwise might not have given. Moreover, the effect on the integrity of the judicial system is the same: the witness’s testimony is inherently unreliable because of the promise of payment. As stated by one court long ago: Payment to [induce] a witness to testify in a particular way, payment of money to prevent a witness’s attendance ... and the payment ... to make him sympathetic ... are all payments which are absolutely indefensible____ The payment of a sum of money to a witness to “tell the truth” is as clearly subversive of the proper administration of justice as to pay him to testify to what is not true. In re Robinson, 151 A.D. 589, 136 N.Y.S. 548 (1912), aff'd, 209 N.Y. 354, 103 N.E. 160, (1913) (emphasis added); see In re Kien, 69 Ill.2d 355, 14 Ill.Dec. 365, 368, 372 N.E.2d 376, 379 (1977) (“[W]e will not tolerate payments of any sum of money by an attorney to witnesses for the opposition to secure or influence testimony, whether it be for the purpose of securing truthful testimony or otherwise” (attorney suspended for 18 months).) This conduct, or acquiescence in such conduct by Wagner, violates DR 7-109(C). Second, Wagner contends that his and Gomberg’s conduct regarding the December 3, 1982 taping of Travis was “at the behest of the United States Attorney’s Office and the F.B.I.” (Plaintiff’s Brief at 54.) Wagner contends that because the Assistant United States Attorney approved the taping and assured them that their cooperation with a governmental investigation could not be construed in any way as an illegal act, “[t]o apply DR 7-109(C) to Gomberg’s conduct in this case would subject an attorney to professional jeopardy by cooperating with governmental investigations of criminal activity.” (Plaintiff’s Br. at 55.) This Court disagrees. First, it is simply not true that Wagner agreed to pay Travis for his testimony only at the “behest” of the Assistant United States Attorney and the FBI. Wagner testified in his deposition that he told Travis he would pay him for his efforts during Wagner’s very first conversation with Travis on November 22, 1982, and he reiterated this agreement two days later after having spoken with Gomberg. (Wagner Dep. at 6-9, 27-35.) Second, this Court cannot condone plaintiff’s effort to invoke governmental involvement to justify clearly unethical conduct. The assurance of the Assistant United States Attorney to Wagner and Gomberg that their cooperation could not in any way be construed as illegal — if indeed such an assurance was ever made — does not immunize Wagner and Gomberg from the consequences of their conduct in the civil context. Although it may be that their conduct was not “illegal” in a criminal sense, it was certainly a violation of the ethical canons of which Gomberg, at least, as an experienced and licensed attorney, should have been aware. Moreover, there is no indication in the record that the United States Attorney’s Office was aware, at the time the Assistant purportedly rendered this opinion, that Gomberg and Wagner were planning to use the FBI tape of the December 3, 1982 meeting to further their own personal gain through a civil law suit. Gomberg himself testified that the extent of his and Wagner’s conversation with the Assistant United States Attorney regarding a civil action was limited to the following: It was simply that there was a possibility, given the information warranting, that we would pursue civil action against Travis and/or Lehman Brothers if the evidence and information warranted it. (Gomberg Dep. at 38.) Thus, the Assistant United States Attorney’s opinion was limited to the criminal context, and, in any event, is not binding on any federal court. Where private parties engage in unethical conduct to redress their own private civil disputes, that conduct is not magically sanitized by the invocation of the involvement and approval of law enforcement authorities. To hold otherwise would be to abdicate the court’s responsibility to monitor and ensure the ethical conduct of attorneys appearing before it to law enforcement authorities. Law enforcement agencies simply are not instruments for the resolution of civil disputes. Gomberg’s conduct during the December 3, 1982 taping also violated at least one more disciplinary rule, DR 7-104(A). DR 7-104(A) prohibits unethical communications with a person of adverse interests and provides: (A) During the course of his representation of a client a lawyer shall not (1) Communicate or cause another to communicate on the subject of the representation with a party he knows to be represented by a lawyer in that matter unless he has the prior consent of the lawyer representing such other party or is authorized by law to do so. (2) Give advice to a person who is not represented by a lawyer, other than the advice to secure counsel, if the interests of such person are or have a reasonable possibility of being in conflict with the interests of his client. From the very beginning of the December 3,1982 taped session with Travis, Gomberg was aware that he was represented by an attorney and that Travis had sought the advice of this attorney regarding this matter. Without obtaining that attorney’s consent, Gomberg proceeded with the taped session and indeed went so far as to render legal advice to Travis. Gomberg’s conduct in this regard clearly violates DR 7-104(A). Gomberg attempts to extricate himself from this situation by arguing that “Travis admitted to Wagner on December 3, 1982, before the meeting began, that his attorney (Hochberg) knew of the meeting and, presumably chose not to attend.” (Plaintiff’s Br. at 55.) Travis, however, stated during the December 3, 1982 meeting: “my lawyers told me not to talk. And I’m talking to you.” (Exhibit J at 108.) Moreover, DR 7-104(A) does not permit Gomberg to “presume” that Travis’s attorney chose not to attend the meeting. Nor does it permit Gomberg to further “presume” that Travis’s attorney had given him consent to interview Travis about a lawsuit Gomberg intended to bring against Travis. Nor does it permit Gomberg to “presume” that Travis’s attorney gave him consent to give his client legal advice. As to the first two “presumptions” that Gomberg would have this Court imply, DR 7-104(A)(l) expressly requires the “prior consent of the lawyer representing such other party.” As to the third, even if Gomberg was unaware that Travis was represented by another attorney, he could not render legal advice to Travis because he must have been aware that Travis’s interests had “a reasonable possibility of being in conflict with the interests of his client.” DR 7-104(A)(2). Indeed, Wagner subsequently sued Travis in this case as a defendant. Finally, Wagner’s and Gomberg’s conduct with regard to filing this action may have violated Fed.R.Civ.P. 11 as well. When the complaint in this case was filed on January 25, 1983, Rule 11 provided in pertinent part: The signature of an attorney constitutes a certificate by him that he has read the pleading; that to the best of his knowledge, information, and belief there is good ground to support it; and that it is not interposed for delay. If a pleading is not signed or is signed with intent to defeat the purpose of this rule, it may be stricken as sham and false____ In January, 1983, Rule 11 required attorneys to have a good faith belief that the claims they alleged in civil actions were supported by good grounds. Rhinehart v. Stauffer, 638 F.2d 1169, 1171 (9th Cir. 1979); Freeman v. Kirby, 27 F.R.D. 395, 396-97 (S.D.N.Y.1961). Lehman’s Rule 11 motion is directed both to Gomberg’s conduct and to Wagner’s conduct. As to Gomberg, Lehman points to two distinct violations, the first of which applies to Wagner as well. First, Lehman claims that Gomberg and Wagner both filed this complaint knowing that it was based primarily on the inherently unreliable and purchased testimony of Travis. Gomberg and Wagner also knew Travis to be both a financially and emotionally desperate man who was hysterical and whom Gomberg not only believed to be “sick” (Exhibit J at 102), but who had impeached his own credibility. Under these circumstances, according to Lehman, neither Gomberg nor Wagner can be believed when they assert that they filed this complaint under a good faith belief that Travis’s allegations against Lehman were true. Second, Gomberg admitted during the December 3, 1982 taped session that he was not concerned about a class action or the rights of any putative class members. Gomberg stated explicitly in the December 3, 1982 taped conversation that he was “not interested in any other customers. I’m interested in Frank.” (Exhibit J at 109.) He went on to state: “Well, class action, I don’t want to try a class action. It’s costly. It takes a — I want to settle.” (Exhibit J at 103.) In light of these admissions, Lehman contends that Gomberg could not have made the class allegations in good faith when he filed this complaint as a class action. Lehman contends that each of these grounds requires that Wagner’s complaint be stricken or dismissed under Rule 11. Each of these grounds is also implicated in Lehman’s opposition to Wagner’s motion for class certification. Wagner responds that although he “knew that Travis’ testimony could not be accepted as truthful on its face, [his] examination of Wagner’s personal trading records corroborated Travis’ statements regarding the handling of Wagner’s account.” (Plaintiff’s Br. at 53.) He also contends that Gomberg’s comments regarding his lack of interest in a class action “obviously were intended only to tell Travis what he wanted to hear because Travis wanted a quick fix of money.” (Plaintiff’s Br. at 51-52.) This contention is surprising in light of Wagner’s attempted explanation for these damaging admissions that his counsel was not interested in a class action in an earlier brief filed in support of his motion for class certification. There, plaintiff contended that Gomberg disavowed any interest in pursuing a class action because “Travis is a very excitable man, and Mr. Gomberg was physically afraid for himself____” (Plaintiff’s Class Br. at 77.) Regardless of the posited post hoc “explanation” for his expressed disloyalty to any class, however, the fact remains that Gomberg contacted Lehman’s General Counsel on January 6, 1983 in an attempt to “settle” Wagner’s individual claims against Lehman. Gomberg’s assertion that he never had Wagner’s authority to settle his individual claims against Lehman on January 6, 1983 is absurd in light of the fact that this case had not yet been filed, let alone a class certified. He had no other conceivable reason for contacting Lehman at that time if it was not to attempt to “settle” the case, and he propounds none. In any event, he certainly gave Lehman’s General Counsel the impression that he had apparent authority to “settle” the case. This Court can only conclude that Wagner and Gomberg, like Travis, were only after a “quick fix of money” which they thought they could get by contacting Lehman’s General Counsel. This Court has no doubt that Gomberg must be disqualified as counsel for plaintiff for his unethical conduct in violation of DR 7-109(C) and DR 7-104(A). In determining whether a violation of the Code of Professional Responsibility warrants disqualification, “[a] court should be conscious of its responsibility to preserve a reasonable balance between the need to ensure ethical conduct on the part of lawyers appearing before it and other social interests, which include the litigant’s right to freely chosen counsel.” Woods v. Covington County Bank, 537 F.2d 804, 810 (5th Cir.1976). Canon 9 of the Code of Professional Responsibility states: “A lawyer should avoid even the appearance of professional impropriety.” Any social interest in permitting Gomberg to continue as counsel in this case is limited solely to the preservation of Wagner’s right to counsel of his own choice. See In re Corrugated Container Antitrust Litigation, 659 F.2d 1341, 1345 (5th Cir.1981). Any interest Wagner had in retaining Gomberg, however, was rendered nonexistent at the outset when Wagner became aware of and indeed helped orchestrate the financial arrangement with Travis. Gomberg thereafter became involved in the scheme. If Wagner is deprived of counsel of his own choice, it is his own fault for engaging in a scheme to purchase the testimony of a witness whom he later turned upon and sued as a defendant. If ever a case reeked of “the appearance of impropriety,” this is the case. For the same reasons, this Court holds that Wagner, or his estate, is not an adequate class representative and that neither Gomberg nor anyone in the Siegan, Barbakoff firm may act as class counsel. An individual seeking class certification must prove that his claims “are typical of the claims ... of the class,” Fed.R.Civ.P. 23(a)(3), and that “... the representative parties will fairly and adequately protect the interests of the class.” Fed.R.Civ.P. 23(a)(4). Because a class action judgment would bind absent class members, strict enforcement of both of these requirements is vitally necessary in order to assure “that protection to absent parties which due process requires.” Hansberry v. Lee, 311 U.S. 32, 45, 61 S.Ct. 115, 120, 85 L.Ed. 22 (1940); see Moscarelli v. Stamm, 288 F.Supp. 453, 461 (E.D.N.Y.1968). Class certification would seriously jeopardize the rights of absent class members here because Wagner is subject to unique defenses and because he would not adequately represent the other class members. It is enough to deny class treatment when a defense peculiar to the class representative is even arguably present. Where the proposed representative’s credibility is subject to attack, unique defense problems are presented. See, e.g., Kline v. Wolf, 88 F.R.D. 696 (S.D.N.Y.1981). aff'd in part, vacated and remanded in part, 702 F.2d 400 (2d Cir. 1983). A putative representative’s credibility problem could well divert the jury’s “attention from the substance of the basic claim” and could severely damage “[t]he remaining class members.” Id. at 700. A court need not resolve the issue of credibility against the putative class representative in order to bar class certification. It is enough to note the existence of a credibility problem and its potential adverse impact on the class. Id. Wagner’s credibility is at issue and is open to serious question. Wagner’s relationship with Travis and his conduct leading to this lawsuit, including his purchased agreement with Travis to testify against Lehman in return for a promise of money, inevitably will be a major credibility issue before the trier of fact. Rule 23(a)(4) further provides that one who seeks to represent a class must “fairly and adequately protect the interests of the class.” The putative representative must demonstrate that he will fulfill his fiduciary duty to the class he purports to represent; reason to doubt the ability to meet his fiduciary obligations results in denying class certification. See, e.g., Kline v. Wolf, supra; Massengill v. Board of Education, Antioch Community High School, 88 F.R.D. 181 (ND.Ill.1980) (Crowley, J.); Folding Cartons, Inc. v. American Can Co., 79 F.R.D. 698 (N.D.Ill.1978) (Crowley, J.); cf. Taub v. Glickman, 14 Fed.R.Serv.2d (Callaghan) 847 (S.D.N.Y.1970). Wagner, as a fiduciary, owes the putative class a “duty of the finest loyalty.” See Folding Cartons, Inc. v. American Can Co., 79 F.R.D. at 703, quoting Meinhard v. Salmon, 249 N.Y. 458, 464, 164 N.E. 545, 546 (1928) (Cardozo, J.). Wagner’s admission that he induced Travis to testify against Lehman by offering to pay him up to 20% of Wagner’s recovery in this case, leads this Court to doubt his ability to adhere to this high standard. The same fiduciary obligations apply as well to counsel seeking to represent the class. Where there is reason to doubt counsel’s ability to meet those duties, class certification must be denied. See, e.g., Kline v. Wolf, supra; Massengill v. Board of Education, Antioch Community High School, supra; Folding Cartons, Inc. v. American Can Co., supra. Aside from the fact that Wagner and Gomberg allowed Travis to believe that his testimony would be compensated, Gomberg’s professed lack of concern for any class action renders him unsuitable as class counsel, regardless of how much time or money he or members of his firm claim to have spent on this case. As early as May 11, 1983, Judge Grady of this Court, to whom this case was then assigned, expressed his concern that Gomberg was apparently not interested in the class: [T]he thing that gives me the most concern is your statement about the class on the tapes. It seems to me that that was gratuitous, and it puts the Court in a difficult position____ What you are doing is asking me to go ahead and certify you as a representative for a class, which you have said on a tape recording you care nothing about. {See Tr. of Hearing on May 11, 1983, at 55-56.) Finally, Gomberg’s violation of the ethical disciplinary rules as set forth above bars him from serving as counsel for the class. An inquiry into the character of counsel for the class-representative is also necessary because he stands in a fiduciary relationship with the absent class. See, e.g., Greenfield v. Villager Industries, Inc., 483 F.2d 824, 832 (3d Cir.1973); Stavrides v. Mellon National Bank & Trust Co., 60 F.R.D. 634, 637 (W.D.Pa.1973). The importance of the attorney’s fiduciary duties to the absent class is emphasized by the concern expressed by the Greenfield court that: Experience teaches that it is counsel for the class representatives, and not the named parties, who direct and manage these actions. Every experienced federal judge knows that any statements (sic) to the contrary is sheer sophistry. 483 F.2d at 832 n. 9. In the majority of the reported decisions, examination of counsel’s character focuses on his ethical behavior and the attorney’s professional responsibility. See, e.g., Halverson v. Convenient Food Mart, Inc., 458 F.2d 927, 931 (7th Cir.1972); Brame v. Ray Bills Finance Corp., 85 F.R.D. 568, 577 (N.D.N.Y. 1979). Reference to