                  United States Court of Appeals
                          FOR THE EIGHTH CIRCUIT
                                  ___________

                                  No. 98-3603
                                  ___________

Lewis J. Atley,                          *
a/k/a Gary J. Semeniuk,                  *
                                         *
                          Appellee,      *        Appeal from the United
                                         *        States District Court for
            v.                           *        the Southern District of Iowa
                                         *
John F. Ault, Warden, ASP,               *
and The State of Iowa,                   *
                                         *
                          Appellant.     *

                                  ___________

                             Submitted: June 18, 1999

                                 Filed: September 15, 1999
                                  ___________

Before BEAM and MORRIS SHEPPARD ARNOLD, Circuit Judges, and KYLE,
District Judge.1


KYLE, District Judge.


      Lewis J. Atley (“petitioner” or “Atley”) filed a petition for writ of habeas
corpus pursuant to 28 U.S.C. § 2254 in the United States District Court for the

      1
          The HONORABLE RICHARD H. KYLE, United States District Judge
for the District of Minnesota, sitting by designation.
Southern District of Iowa after being convicted of various drug-related crimes in
Iowa state court. Petitioner claimed that he was entitled to a new trial because he was
denied effective assistance of counsel due to his attorney’s conflict of interest. The
district court2 granted Atley’s petition for writ of habeas corpus. John F. Ault and the
State of Iowa (“the Appellants”) appeal and, for the reasons stated below, we affirm
the judgment of the district court.


                                           I


      Petitioner was arrested in 1994 after police discovered a psilocybin mushroom-
growing operation in his home. After a six-count indictment was filed against the
petitioner, attorney J.E. Tobey, III (“Tobey”) was appointed to represent him. On
November 16, 1994, Tobey filed a motion to withdraw, stating that he was
uncomfortable representing petitioner because petitioner insisted on acting as co-
counsel. The court granted the motion and appointed attorney Carroll J. Walker
(“Walker”) to represent petitioner.


      On January 7, 1995, petitioner requested that Walker be replaced. The court
granted the request, noting: “it appears that all communication between defendant and
counsel had broken down.” The court then appointed attorney Robert Weinberg
(“Weinberg”) to represent petitioner. On April 21, 1995, a pretrial conference was
held and trial was scheduled for June 5, 1995.
      On June 1, 1995, Weinberg learned that he had been hired, effective June 15,
1995, to replace Hugh Pries (“Pries”) at the Scott County Attorney’s office. Pries

      2
       The HONORABLE ROBERT W. PRATT, United States District Judge for
the Southern District of Iowa.
                                          -2-
handled a large number of drug cases for the county attorney’s office and had close
relationships with the Quad-City Metropolitan Enforcement Group (“MEG”) officers,
who were to be the principal witnesses in the case against petitioner. Weinberg
immediately informed petitioner that he had accepted a job with the Scott County
Attorney’s office and that he had ethical problems with his continued representation
of petitioner.


      On June 2, 1995, Weinberg filed a motion to withdraw as counsel of record,
citing ethical and disciplinary rules, as well as constitutional concerns. Petitioner
subsequently filed his own motion for removal of counsel and phoned a threat to
Weinberg that he would ask the Iowa Supreme Court to sanction him.


      On June 5, 1995, the court heard arguments on Weinberg’s motion to
withdraw. Both Weinberg and the State argued in favor of the motion:
             Mr. Weinberg: I feel that there has been adequate preparation
      taken so that an additional – a new attorney would just clean up those
      items that Mr. Atley had wished to pursue prior to trial, but I think that
      under all the circumstances – just to be quite candid with the court, I just
      feel that I’m put in a very difficult position, in terms of what the canons
      of ethics require.
             Mr. Atley, I think, as shown from the record, is a fairly difficult
      person to deal with. I’ve had rapport with him; however, on my
      answering machine this morning was a – you know threat to ask the
      Supreme Court to take sanctions about me, which after I talked with him
      last night – I mean – I had no inkling about, but – you know, I got
      different signals from him. I just think that there’s such a breach in the
      attorney-client relationship that I could not be effective, and I think the
      outcome of this case is likely to be such that the fact of my having
      pursued a trial under these circumstances would raise serious questions
      about whether or not any future conviction would stand, that I have – I
      have that concern also.
             THE COURT: Does the State have anything it wishes to add?

                                          -3-
            MR. OTTESON: Yes, Your Honor. I have reviewed Canon 5,
      which states a lawyer should exercise independent professional
      judgment on behalf of a client, have also reviewed the ethical
      considerations in the disciplinary rules under that canon, and I concur
      with Mr. Weinberg in the conclusions that he has drawn from them.
            The State is in a very difficult position in this case, in raising – in
      making a specific statement or a specific claim, since Mr. Weinberg is
      going to be, in the near future, working with us. Most of the cases and
      opinions that have dealt with changes of employment by lawyers have
      opted in favor of the client being given the rights, and not deprived of
      them, and I think that clearly, in this case, forcing this matter to trial
      today would be going against the general grain of those opinions.

After hearing from both counsel, the trial court denied the motion, stating that
Weinberg had been a zealous advocate to that point in his representation of petitioner
and that, based on its personal acquaintance with Weinberg, the Court had no doubts
that he would continue to zealously represent petitioner. The trial court further noted
that court-appointed attorneys, members of the defense bar, county attorneys and part-
time magistrates often switch roles and are able to do so without difficulty. With
regard to the MEG officers, the trial court stated:
      The MEG officers, in addition to the prosecutors and the defense bar, all
      get along well and understand each other’s roles, and will not be
      inclined to testify any differently at this trial than they would be
      otherwise, nor will they treat Mr. Weinberg any differently after June
      15, when he changes hats.

Finally, the trial court stated that it didn’t “give a huge amount of weight” to the
concerns raised by petitioner because he was on his third attorney and it appeared that
petitioner was engaged in an attempt to delay the proceedings.




                                           -4-
      The trial began on June 5, 1995, and, on June 8, 1995, the jury returned guilty
verdicts on all six counts.3 Petitioner was sentenced on June 27, 1995 to a term of
imprisonment of 20 years.


      On January 22, 1997, the Iowa Supreme Court affirmed the conviction. Atley
petitioned for and was granted a rehearing en banc. The en banc court affirmed his
conviction, with three justices dissenting. See State v. Atley, 564 N.W.2d 817
(Iowa), cert. denied, 513 U.S. 1046 (1997). The Iowa Supreme Court held that
petitioner was not deprived of his Sixth Amendment right to counsel by the trial
court’s alleged failure to conduct an inquiry into Weinberg’s conflict of interest. It
began its analysis by noting that where a defendant or his attorney gives the trial court
notice of an alleged conflict of interest and the trial court fails to inquire into the
conflict, a reviewing court will presume prejudice upon a showing of possible
prejudice. Id. at 825 (citing Holloway v. Arkansas, 435 U.S. 475, 484-91, 98 S. Ct.
1173, 1178-82 (1978)). Addressing petitioner’s case, the Iowa Supreme Court stated
that the actual or serious potential for conflict that might occur during the trial
because of Weinberg’s pending employment necessitated an inquiry by the trial court
to assess its gravity. Id. at 829. The court found, however, that the proceedings
conducted by the trial court were adequate because the “hearing” demonstrated that
the trial court was “well aware of the possible conflicts of interest” and further




      3
        Manufacture of a controlled substance (psilocybin) in violation of Iowa
Code section 124.401(c)(6), possession of a controlled substance with the intent to
deliver (psilocybin) in violation of section 124.401(1)(b), failure to affix a tax
stamp (psilocybin) in violation of section 453B.12, possession with the intent to
deliver (cannabis) in violation of section 453B.12, and possession of a controlled
substance (methamphetamine) in violation of section 124.401(3).
                                           -5-
inquiry was unlikely to uncover additional facts from which it could base its decision.
Id.


      On July 14, 1997, petitioner filed the Petition in the instant case. The district
court granted the Petition, finding that the majority opinion of the Iowa Supreme
Court was an unreasonable application of clearly established federal law on two
separate and independent grounds: First, the Iowa Supreme Court unreasonably
applied the United States Supreme Court’s decisions in Holloway v. Arkansas, 435
U.S. 475, 98 S. Ct. 1173 (1978) and Wood v. Georgia, 450 U.S. 261, 101 S. Ct. 1097
(1981) when it held that the trial court made a constitutionally adequate inquiry into
the alleged conflict of interest. Second, Weinberg’s future employment created an
actual conflict of interest and the Iowa Supreme Court unreasonably applied federal
law that required the trial court to substitute new counsel for petitioner. The district
court then determined that petitioner was entitled to a new trial.


                                          II


      Our review of petitioner’s habeas petition is limited by the Antiterrorism and
Effective Death Penalty Act of 1996, which provides in relevant part:
      (d) An application for a writ of habeas corpus on behalf of a person in
      custody pursuant to the judgment of a State court shall not be granted
      with respect to any claim that was adjudicated on the merits in State
      court proceedings unless the adjudication of the claim-
      (1) resulted in a decision that was contrary to, or involved an
      unreasonable application of, clearly established Federal law, as
      determined by the Supreme Court of the United States; or
      (2) resulted in a decision that was based upon an unreasonable
      determination of the facts in light of the evidence presented in the State
      court proceeding.

                                          -6-
28 U.S.C. § 2254(d). The parties agree that § 2254(d)(2) is not implicated by the
Iowa Supreme Court’s decision. Thus, our review is governed by § 2254(d)(1).
Because § 2254(d)(1) directs this court to grant Atley’s petition only if the trial
court’s decision was contrary to, or involved an unreasonable application of, clearly
established Supreme Court precedent, we must first identify the controlling case law.


      A.     Clearly Established Supreme Court Precedent


      The Sixth Amendment provides: “In all criminal prosecutions, the accused
shall enjoy the right . . . to have the Assistance of Counsel for his defense.” U.S.
Const. amend. VI. The Supreme Court has recognized that the right to counsel
guaranteed by the Sixth Amendment includes the “right to representation that is free
from conflicts of interest.” Wood, 450 U.S. at 271, 101 S. Ct. at 1103; see also
Cuyler v. Sullivan, 446 U.S. 335, 345-50, 100 S. Ct. 1708, 1716-19 (1980);
Holloway, 435 U.S. at 481-87, 98 S. Ct. at 1177-80. When burdened by a conflict of
interest, counsel “breaches the duty of loyalty, perhaps the most basic of counsel’s
duties” and, therefore, fails to provide effective assistance of counsel. See Strickland
v. Washington, 466 U.S. 668, 692, 104 S. Ct. 2052, 2067 (1984).


      In Strickland, the Supreme Court held that to obtain a reversal of a conviction
for ineffective assistance of counsel, a petitioner must show that counsel’s
performance fell below professional standards of competence, and that the deficient
performance prejudiced the petitioner. Id., 466 U.S. at 687, 104 S. Ct. at 2064. The
Court also recognized that in certain Sixth Amendment contexts, prejudice may be
presumed. Id. at 692, 104 S. Ct. at 2067. Quoting from its decision in Cuyler, the
Strickland Court noted that prejudice is “presumed only if the defendant demonstrates

                                          -7-
that counsel ‘actually represented conflicting interests’ and that ‘an actual conflict of
interest adversely affected his lawyer’s performance.’” Id.


      Cuyler applies, however, only to those cases in which a defendant raises no
objection to his counsel’s representation at or before trial. See Cuyler, 446 U.S. at
348, 100 S. Ct. at 1718. In Cuyler, the defendant argued that he was denied effective
assistance of counsel because his lawyers had a conflict of interest due to their
representation of multiple defendants. Id. at 345, 100 S. Ct. at 1716. At no time
before or during the trial did the defendant or his lawyers object to the multiple
representation. Id. at 337-38, 100 S. Ct. at 1712. The Supreme Court held that in
order to “establish a violation of the Sixth Amendment, a defendant who raised no
objection at trial must demonstrate that an actual conflict of interest adversely
affected his lawyer’s performance.” Id. at 348, 100 S. Ct. at 1718. The Cuyler Court
recognized, however, that where a defendant makes a timely objection, the trial court
has an obligation under Holloway to determine whether an actual conflict exists. Id.
at 346, 100 S. Ct. at 1717.


      In Holloway, the trial court appointed one public defender to represent all three
defendants at the same trial. Holloway, 435 U.S. at 477, 98 S. Ct. at 1175. On
several occasions prior to and during trial, the public defender asked the court to
appoint separate counsel for each defendant because of a possible conflict of interest.
See id. at 477-80, 98 S. Ct. at 1175-77. The trial court refused to consider the
appointment of separate counsel. See id. The jury found all three defendants guilty.
See id. at 481, 98 S. Ct. at 1177. The United States Supreme Court reversed their
convictions, holding that the trial court erred by “fail[ing] either to appoint separate
counsel or to take adequate steps to ascertain whether the risk was too remote to

                                           -8-
warrant separate counsel.” Id. at 484, 98 S. Ct. at 1178. The Court found the failure
to appoint separate counsel or to make an adequate inquiry “deprived [defendants] of
the guarantee of ‘assistance of counsel.’” Id. at 484,488, 98 S. Ct. at 1179, 1181.
Finally, the Holloway Court held that when a trial court fails to discharge its
constitutional duty to determine whether the defendant is receiving assistance of
counsel unburdened by a conflict of interest, prejudice is presumed and reversal of
the conviction is automatic. See id. at 489, 98 S. Ct. at 1181; see also Wood, 450
U.S. at 272 n.18, 101 S. Ct. at 1104 n.18 (noting that Cuyler “mandates a reversal
when the trial court has failed to make an inquiry even though it ‘knows or reasonably
should know that a particular conflict exists’”) (quoting Cuyler, 446 U.S. at 347, 100
S. Ct. at 1717)). 4


       Petitioner’s Sixth Amendment claim is that, when notified of the potential
conflict of interest, the trial court violated its constitutional duty under Holloway to
conduct an adequate inquiry, thus requiring an automatic reversal. See Atley, 564
N.W.2d at 828. We find that this claim falls within the clearly established framework
of Holloway, Cuyler, and Wood. Accordingly, we must next decide whether the Iowa




       4
        The court notes that both Holloway and Cuyler involved situations where
the alleged conflict of interest arose due to counsel’s joint representation of co-
defendants. The rule announced by these cases is not limited, however, to such
situations. See, Wood, 450 U.S. at 268-74, 101 S. Ct. 1102-04 (finding that the
trial court violated its duty to inquire into the conflict created by the fact that the
defendant’s lawyer was hired and paid by a third party); United States v. Horton,
845 F.2d 1414, 1418-20 (7th Cir. 1988) (applying Holloway and Cuyler to a
defendant’s claim that his attorney’s application for a position as a United States
Attorney created a conflict of interest that deprived him of his Sixth Amendment
right to counsel).
                                           -9-
Supreme Court’s decision was “contrary to” or an “unreasonable application of” those
decisions.


      B. “Contrary to”or an “Unreasonable Application of”


      28 U.S.C. § 2254(d)(1) provides that a petition for writ of habeas corpus cannot
be granted unless the adjudication of the claim in state court proceedings resulted in
a decision that was “contrary to, or involved an unreasonable application of,” clearly
established federal law. The district court found that the Iowa Supreme Court’s
decision was not “contrary to” clearly established federal law. We agree. The
conflict of interest issue presented by the instant case is neither a question of pure
law, nor a case in which Supreme Court precedent requires a particular result. See
Long v. Humphrey, No. 98-3409, 1999 WL 494096, at *2 (8th Cir. July 14, 1999)
(finding that a state court’s decision was not “contrary to” clearly established law
because the habeas petition did not “present a question of pure law and because the
manifest necessity standard [could not] be applied mechanically to require a particular
result in Long’s case.”). Thus, petitioner’s habeas claim turns on the “unreasonable
application of” prong of § 2254(d)(1).


      A state court decision is an “unreasonable application of” clearly established
federal law if the “decision, evaluated objectively and on the merits, resulted in an
outcome that cannot reasonably be justified under existing Supreme Court precedent.”
Long, 1999 WL 494096, at *2-3 (quoting Matteo v. Superintendent, SCI Albion, 171
F.3d 877, 890 (3d Cir. 1999) (en banc)). In making this evaluation, our “mere
disagreement with the [trial court’s] conclusions is not enough to warrant habeas
relief.” Matteo, 171 F.3d at 890. To the extent that “inferior” federal courts have

                                         -10-
decided factually similar cases, reference to those decisions is appropriate in
assessing the reasonableness of the state court’s resolution of the disputed issue. See
O’Brien v. Dubois, 145 F.3d 16, 25 (1st Cir. 1998).


      1.     Duty to Inquire


      On June 5, 1995, the state trial court heard argument from both Weinberg and
the prosecutor that Weinberg could not continue to represent Atley. As the Iowa
Supreme Court recognized, the representations of Weinberg and the prosecutor
alerted the trial judge to the “actual or serious potential for conflict that might occur
during the trial” and “necessitated an inquiry by the court to assess its gravity.”
Atley, 564 N.W.2d at 829; see also id. at 828 (noting that it was applying Supreme
Court authorities that require an inquiry because the trial court was fully advised of
the existence of a potential conflict of interest). Under Holloway, the trial court was
then constitutionally obligated to either substitute new counsel or take adequate steps
to ascertain the seriousness of the risk presented by the conflict. The undisputed
record makes clear, however, that the trial court asked no questions of counsel or of
the defendant to ascertain the nature and extent of the conflict of interest. The Iowa
Supreme Court excused this failure, holding that the trial court was not required to
make further inquiry into the factual nature of the conflict of interest because the
hearing held by the trial court demonstrated that it was well aware of the possible
conflicts of interest and that further questioning was unnecessary. Id. Thus, the issue
before this court is whether the Iowa Supreme Court’s ruling on the adequacy of the
trial court’s inquiry constitutes a reasonable application of the rule announced in
Holloway. We conclude that it does not.



                                          -11-
      Although the record reflects that the trial court was aware of the areas in which
a conflict of interest could have arisen, such knowledge alone does not satisfy the
requirements of Holloway. Under Holloway, the purpose of the inquiry is to
“ascertain whether the risk [is] too remote to warrant [new] counsel.” Holloway, 435
U.S. at 484, 98 S. Ct. at 1178. In the instant case, the trial court appropriately
identified Weinberg’s relationship with the MEG officers who would be testifying,
and whom Weinberg would be cross-examining, as one relevant area of concern. As
the district court noted, an issue in the case was Atley’s contention that the MEG
officers intentionally and in bad faith destroyed evidence favorable to Atley. The trial
court did not, however, make any inquiry into whether Weinberg would be able to
zealously cross-examine these officers. Instead, the trial court stated its opinion that
the “MEG officers, in addition to the prosecutors and the defense bar, all get along
well and understand each other’s roles, and will not be inclined to testify differently
at this trial than they would be otherwise, nor will they treat Mr. Weinberg any
differently after June 15, when he changes hats.”


      We recognize that the nature of the factual inquiry required by Holloway is
necessarily case-specific, and that, in some cases, no inquiry may be required because
all of the relevant facts have been disclosed to the court. Holloway cannot be
interpreted so broadly, however, as to condone the “inquiry” conducted by the state
court in the instant case. As the record shows, Weinberg raised in only the broadest
strokes his potential conflicts of interest, including the potential conflict with the
MEG officers who would be testifying in the case. The prosecution agreed that
Weinberg’s change of jobs warranted substitution of new counsel. In such a
situation, the trial court must do more than substitute its opinions as to the
congeniality among MEG officers, prosecutors and members of the defense bar, for

                                          -12-
an actual inquiry into the factual basis of Weinberg’s motion. Stated differently, the
trial court’s dialogue improperly assumed answers to questions that were never asked
and were necessary to its determination of whether the alleged conflict of interest
required the substitution of new counsel. Instead of ascertaining whether Weinberg
would be able to vigorously cross-examine the very people with whom he would be
working closely, the trial court opined that each side would perform its roles
appropriately. Given the risk, as acknowledged by the Iowa Supreme Court, for an
“actual or serious potential for conflict,” the trial court failed to take adequate steps
to ascertain the gravity of Weinberg’s motion. Thus, we hold that the Iowa Supreme
Court’s conclusion that the trial court adequately inquired into the potential conflict
of interest, evaluated objectively and on the merits, was an unreasonable application
of clearly established Supreme Court precedent.5


      In reaching this decision, we reject the Iowa Supreme Court’s reliance on
United States v. Horton, 845 F.2d 1414 (7th Cir. 1988). The Iowa Supreme Court’s
decision appears to suggest that an inquiry was not necessary because the instant case
is factually similar to Horton and, as a result, the possibility of a conflict was so
remote that no further inquiry by the trial court was necessary. Atley, 564 N.W.2d
at 829-30. In Horton, the Seventh Circuit held that the Sixth Amendment right to
counsel was not violated when the defendant’s attorney had applied for a job as a
United States Attorney. Id. at 1415, 1421. The Horton court held that the defense
attorney’s job did not create a per se actual conflict and that, under the facts of the

      5
        Because we find that the Iowa Supreme Court’s conclusion that the trial
court adequately inquired into the potential conflict of interest was an
unreasonable application of clearly established federal law, we need not address
the district court’s determination that an actual conflict of interest existed that
required the appointment of new counsel for petitioner.
                                          -13-
case, the possibility of a conflict was too remote to create an actual conflict. Id. at
1419-20. As a result, the Horton court found that the defendant had failed to establish
a violation of his Sixth Amendment rights.


       Horton, however, is easily distinguished from the instant case on numerous
grounds. Most significantly, Horton did not raise his attorney’s potential conflict of
interest at trial, relying instead on a “vaguely-voiced distrust” of his counsel. See
Horton, 845 F.2d at 1418. As a result, the Horton court applied the more stringent
test set forth in Cuyler rather than Holloway. Id. at 1418-19 (distinguishing
Holloway and noting that where a defendant raises a potential conflict of interest after
trial, the court must apply the standard set forth in Cuyler). As a result, Horton was
required to show, as a threshold matter, that there was an actual conflict of interest
– that is, that the defense attorney was required to make a choice advancing his own
interests to the detriment of his client’s interests. See id. In the instant case,
however, Atley, his counsel, and the prosecutor raised the conflict of interest before
the trial. As a result, this case is governed by Holloway, which provides that
prejudice to the defendant will be presumed upon a showing of possible prejudice.
See id. at 1418 (citing Holloway, 435 U.S. at 484-91, 98 S. Ct. 1173 for the
proposition that “‘[i]f a defendant or his attorney gives the trial court notice of the
alleged conflict and the trial court fails to inquire into the conflict, a reviewing court
will presume prejudice upon a showing of possible prejudice.”). Therefore, Horton
was decided under a different standard than applies to petitioner’s case and does not
address whether petitioner had shown possible prejudice sufficient to trigger the trial
court’s duty to inquire into the nature of that conflict.




                                           -14-
         Horton is also factually distinguishable from the instant case. In Horton, the
defendant was the only individual claiming that his counsel had a conflict of interest.
Horton, 845 F.2d at 1416-18. Here, Atley, his counsel, and the prosecutor all
represented to the court that Weinberg’s new job created a conflict of interest that
required the substitution of new counsel. Furthermore, Horton’s counsel had only
applied for a job with the United States Attorney’s office, whereas here, Weinberg
had actually accepted a position that required him to interact closely with the very
officers he would be cross-examining. Both of these facts increased the possibility
of prejudice to Atley and further distinguish the instant case from Horton.


         Finally, we note that the trial court’s concern that Atley was engaging in some
sort of dilatory practice does not excuse its failure to adequately inquire into the
nature of the alleged conflicts of interest. Although trial courts must, in general, be
wary of defendants who seek dismissal of counsel as a means of delaying trial, the
potential conflict of interest in the instant case was raised primarily by petitioner’s
counsel and was supported by the prosecutor. As the dissent noted in Atley, “[t]o
ascribe to Atley a motive to delay would necessarily mean that the trial court was
ascribing such a motive to Weinberg and the prosecutor as well.” Atley, 564 N.W.2d
at 839 (Lavorato, J., dissenting). No evidence exists in the record to support such a
claim.


         2.    Appropriate Relief


         Having determined that the Iowa Supreme Court’s decision constitutes an
unreasonable application of clearly established federal law, as announced by the
Supreme Court in Holloway, we turn to petitioner’s requested habeas relief. As

                                           -15-
Holloway makes clear, a failure to conduct an adequate inquiry constitutes a violation
of the Sixth Amendment right to counsel that requires reversal. This case is before
us, however, on a petition for writ of habeas corpus, not on direct appeal. Because
the Supreme Court has made clear that collateral review is different from direct
review, see Brecht v. Abrahamson, 507 U.S. 619, 633-38, 113 S. Ct. 1710, 1719-22
(1993) (“ The principle that collateral review is different from direct review resounds
throughout our habeas jurisprudence.”), we pause to make clear that petitioner’s
successful Holloway claim entitles him to habeas relief.


      In Brecht, the Supreme Court held that constitutional trial errors would be
evaluated under the harmless “beyond a reasonable doubt” standard set forth in
Chapman v. California, 386 U.S. 18, 87 S. Ct. 824 (1967) only on direct appeal, and
that in habeas cases the appropriate standard was the “less onerous harmless error
standard” of Kotteakos v. United States, 328 U.S. 750, 66 S. Ct. 1239 (1946). Brecht,
507 U.S. at 623-24, 635-38, 113 S. Ct. at 1714, 1721-22. Brecht recognized,
however, that cases involving constitutional trial errors are fundamentally different
from cases involving constitutional violations, such as deprivation of the right to
counsel, that are not subject to harmless-error analysis. Id. at 629-30, 113 S. Ct. at
1717; see also Arizona v. Fulminante, 499 U.S. 279, 309-10, 111 S. Ct. 1246, 1264-
65 (1991) (distinguishing constitutional trial errors subject to harmless-error review
from “structural defects in the constitution of the trial mechanism, which defy
analysis by ‘harmless-error’ standards.”). The Brecht Court, drawing no distinction
between collateral and direct review, recognized that the existence of constitutional
defects not subject to harmless-error review “requires automatic reversal of the
conviction because they infect the entire trial process.” Brecht, 507 U.S. at 629-30,
113 S. Ct. at 1717.

                                         -16-
      As stated above, Holloway requires reversal where the trial court failed to
discharge its duty to inquire into a known potential conflict because prejudice to the
accused is presumed. Holloway, 435 U.S. at 487-89, 98 S. Ct. at 1180-81. In
reaching this determination, the Holloway court stated that the harmless-error
standard did not apply because the right to have conflict-free assistance of counsel
“‘is too fundamental and absolute to allow courts to indulge in nice calculations as
to the amount of prejudice arising from its denial’” and because any form of harmless
error analysis “would require, unlike most cases, unguided speculation.” Id. at 488,
491, 98 S. Ct. at 1181-82 (quoting Glasser v. United States, 315 U.S. 60, 75-76, 62
S. Ct. 457, 467 (1942)). Thus, a Holloway violation is not a constitutional trial error
subject to Brecht’s harmless error standard, but rather a constitutional defect that
entitles petitioner to habeas relief. See Hamilton v. Ford, 969 F.2d 1006, 1013 (11th
Cir. 1992) (granting petition for writ of habeas corpus because reversal of conviction
is “automatic” when the trial court failed to adequately explore the possibility of a
conflict of interest as required by Holloway). Stated differently, because Holloway
instructs us to presume prejudice to the petitioner, he has satisfied his burden under
Strickland to show that he was deprived of effective assistance of counsel in violation
of the Sixth Amendment. See Strickland, 466 U.S. at 692, 104 S. Ct. at 2067.
Accordingly, we affirm the habeas relief awarded by the district court.


      In granting Atley’s petition for writ of habeas corpus, the district court stayed
its execution for 90 days to permit the State of Iowa to make a decision whether to
prosecute petitioner again, and if so, time to provide Atley a new trial. Therefore, the
writ shall issue unless, within 90 days from the date of this opinion, the state has
commenced proceedings to retry the petitioner.



                                          -17-
A true copy.


      Attest:


               CLERK, U.S. COURT OF APPEALS, EIGHTH CIRCUIT.




                              -18-
