Justia Legal Ethics Opinion Summaries

Tenants sued for breach of contract and bad faith retention of $4,800 from a security deposit; they subsequently moved to compel responses to requests for admission and interrogatories and requested sanctions ($3,060). Orders granting the sanctions were filed on March 20. On April 15, Tenants sought dismissal without prejudice and Landlord sought reconsideration or to set aside the sanctions, asserting that counsel was representing Tenants “pro bono,” so they incurred no legal fees, contrary to Tenants’ attorney’s representation. The clerk entered the dismissal on April 18. On May 6, Tenants filed “objections” to Landlord's motion, arguing that the court had no jurisdiction to reconsider the sanctions because Tenants dismissed their case. On May 28, the trial court granted Landlord’s motion and set aside the sanctions orders. A June 21 order states: “This matter was continued solely for the purpose of addressing the referral of Plaintiff’s counsel to the Bar. The Court determines that ... there was no intentional misrepresentation. The Court will not refer this matter to the Bar.”The court of appeal affirmed, rejecting Tenants’ argument that because they filed a voluntary dismissal, the court lacked jurisdiction to reconsider and set aside the sanctions orders. Disallowing reconsideration when sanctions were based on misrepresentations would violate a reasonable sense of justice and fair play View "Manhan v. Gallagher" on Justia Law

The identity of plaintiff's nontestifying expert is not entitled to absolute work product protection because it is not "a writing" that would reveal his "impressions, conclusions, opinions, or legal research or theories." However, if an attorney can show that disclosure of the identity of a nontestifying expert would result in opposing counsel taking undue advantage of the attorney's industry or efforts or impair the attorney's ability to prepare and investigate a case, the identity may be entitled to protection under the qualified work product privilege. In that case, the identity is only discoverable if the party seeking discovery can establish that "denial of discovery will unfairly prejudice the party seeking discovery in preparing that party's claim or defense or will result in an injustice."Plaintiff, an attorney and third-party witness in the underlying action, appeals from an order granting the motion of the California Employment Lawyers Association (CELA) to compel him to provide deposition testimony identifying a nontestifying expert whom plaintiff consulted in prior litigation. In the underlying action, CELA alleges an unknown CELA member (Doe 1) sent plaintiff, a non-member, information received from a members-only email distribution list in violation of a confidentiality agreement.The Court of Appeal concluded that the identity of Doe 1 is entitled to at most qualified attorney work product protection, and the trial court did not abuse its discretion in finding CELA met its burden to demonstrate denial of disclosure would unfairly prejudice CELA in prosecuting the action and only minimally disadvantage plaintiff. The court agreed with CELA that plaintiff has appealed from a nonappealable discovery order, but the court treated plaintiff's appeal as a petition for writ of mandate. Therefore, the court dismissed the appeal and denied the petition. View "Curtis v. Superior Court of Los Angeles County" on Justia Law

In this long-running contract dispute, at issue is whether the parties are entitled to fee awards. The Fifth Circuit concluded that IWS is entitled to some fees under the Texas Theft Liability Act (TTLA) and remanded for a determination of the proper amount. The court clarified that the mandate of Transverse II did not depart from Texas law governing fee segregation, and fees incurred defending the TTLA claim do not become unrecoverable simply because they may have furthered another nonrecoverable claim as well.The court also concluded that, because the Supply Contract itself does not authorize attorneys' fees, under Iowa law, the district court lacked a basis on which to award Transverse attorney's fees for IWS's breach of this agreement. In this case, IWS has made the showing necessary to prevail under plain-error review, and thus the court reversed the fee award to Transverse on the Supply-Contract claim. Finally, the court rejected Transverse's contention that the district court erred by failing to recognize it as the prevailing party on the Non-Disclosure Agreement claim and refusing to award Transverse the related fees. The court explained that Transverse did not prevail, substantially or otherwise, on this claim and thus there was no error on the district court's part. View "Transverse, LLC v. Iowa Wireless Services, LLC" on Justia Law

The Appellants, with a $594,000 Small Business Administration loan, bought a Harrisburg, Pennsylvania property that became a pub. They executed a note, mortgage, and unconditional guarantees, providing that federal law would control the enforcement of the note and guarantees and that they could not invoke any state or local law to deny their obligations. The Appellants defaulted on the loan and sold the property. The SBA allowed the sale to proceed but declined to release the Appellants from their loan obligations, which were assigned to CBE for collection. The Appellants sued, citing the Fair Debt Collection Practices Act (FDCPA), 15 U.S.C. 1692, the Fair Credit Reporting Act (FCRA), 15 U.S.C. 1681, and the Pennsylvania Unfair Trade Practices and Consumer Protection Law (UTPCPL). CBE sought sanctions under Federal Rules 11 and 37, arguing that the Appellants brought frivolous claims and disobeyed discovery orders. The Appellants filed an untimely brief opposing sanctions and summary judgment, which did not include the separate responsive statement of material facts required by Local Rule. The district court granted summary judgment and denied the sanctions motions, reasoning that neither FDCPA not UTPCPL applies to commercial debts and the Appellants identified no material facts supporting their other claims. The Third Circuit affirmed and granted CBE FRAP 38 damages. The Appellants filed a brief that was essentially a copy of the one filed in the district court. The substance of their appeal “is as frivolous as its form.” View "Conboy v. United States Small Business Administration" on Justia Law

This case arose from a two-car accident in Mississippi in which a Hyundai Excel was traveling southbound at a closing speed of 68 to 78 mph and, for reasons unknown, crossed the center line into the oncoming lane of traffic, striking a Lincoln Continental passenger car traveling northbound. None of the three Excel occupants survived the collision. This case made it to the Mississippi Supreme Court after an earlier appeal and remand for a new trial. During the remand proceedings, multiple discovery disputes ensued before the trial court ultimately held two 606(b) hearings on October 30, 2018, and January 23, 2019 (nearly four years after the trial court’s original denial of relief). The trial court expressly found that one of Applewhite’s counsel, Dennis Sweet, III, misrepresented his relationship with a witness, Carey Sparks, during the April 2015 hearing. It was not until a January 25, 2018 hearing, that Sweet admitted that he had paid Sparks to perform services during the Applewhite trial. This admission was made only after documents evidencing multiple payments to Sparks by Sweet surfaced in the discovery ordered by the Supreme Court. During discovery, multiple witnesses, including six attorneys, testified that Sparks stated that he had knowledge of discussions of the jurors during the trial. Following the 606(b) hearings, the trial court issued a one-paragraph order, finding that the posttrial testimony of the jurors offered no evidence supporting Defendants’ allegations. Reviewing the trial court proceedings, the Mississippi Supreme Court concluded "a fair and impartial trial was not had." The Court found "overwhelming evidence of actual impropriety, which destroys any confidence in the jury verdict. The facts developed in this record threaten the public’s confidence in our system of justice. We find that this case is permeated by actual deception upon the trial court, which led to Plaintiffs’ obtaining a favorable ruling. Such improper acts of misconduct leave a indelible stain on these proceedings. We are loathe to overturn jury verdicts, yet justice dictates a reversal and a retrial, unencumbered by extraneous assaults on our justice system. We considered the ultimate sanction of dismissal of this case with prejudice. We decline to impose such a severe sanction, for no evidence suggests that any Plaintiff employed Sparks or had knowledge of Sparks’s actions. But the judgment must be reversed." This case was remanded for a new trial. View "Hyundai Motor America, et al. v. Applewhite, et al." on Justia Law

The Fifth Circuit granted panel rehearing; denied rehearing en banc; withdrew its prior opinion; and substituted the following opinion.Frank Williams, Jr. filed suit in Louisiana state court against his former employer, Lockheed Martin, seeking to recover damages for asbestos-related injuries. After Williams passed away, his children were substituted as plaintiffs. Lockheed Martin removed the case under federal officer removal jurisdiction and the district court granted summary judgment for Lockheed Martin, issuing sanctions against plaintiffs' counsel for improper ex parte communications.The court affirmed the district court's judgment, concluding that the district court properly considered the full state-court record as it existed at the time of removal and Lockheed Martin has met the requirements for federal officer removal jurisdiction under 28 U.S.C. 1442(a)(2)(1). In this case, Lockheed Martin alleged the requisite nexus and has stated sufficient facts to make out a colorable Boyle defense. The court also concluded that the district court did not abuse its discretion with respect to any of the challenged discovery orders.The court applied Louisiana law and affirmed the district court's grant of summary judgment in favor of Lockheed Martin on plaintiffs' survival and wrongful death claims. Finally, the court concluded that the district court did not err by imposing sanctions on plaintiffs' attorney and that the district court did not abuse its discretion in awarding $10,000 in attorney's fees. View "Williams v. Lockheed Martin Corp." on Justia Law

After plaintiff filed suit against defendant and won a judgment for $133,792.11 plus postjudgment interest, plaintiff sought attorney fees of $271,530, which were later increased to $287,640 in the trial court and now to $292,140 in this court. The trial court awarded $90,000 in attorney fees.The Court of Appeal affirmed the trial court's award of attorney fees, concluding that the trial court used sound discretion to limit the attorney fees to $90,000. The trial court began with the conventional lodestar calculation and gave good reasons for concluding that 600 plus hours was reasonable. However, the court reversed the trial court's ruling that plaintiff had no basis to collect the $90,000 award from an insurance company called Wesco that had posted a surety bond for defendant. Rather, the court concluded that the liability of the surety is commensurate with the liability of its principal. In this case, by statute, the court concluded that defendant must pay the attorney fees as a matter of costs and so too must Wesco. Accordingly, the court remanded for the trial court to amend the judgment to make surety Wesco liable for the $90,000 fee award as an item of costs. View "Karton v. Ari Design & Construction, Inc." on Justia Law

Braden and Strong used the Tennessee state courts to resolve the dissolution of their business partnership. During that process, Strong believed she was the victim of legal malpractice. She hired the Parrish Law Firm to represent her in a lawsuit against her original attorney. Strong’s malpractice case was later dismissed when the Parrish Firm did not comply with discovery deadlines. Strong assigned some of her rights in the partnership dissolution action to the Parrish Firm for costs and expenses in the malpractice action. When the Parrish Firm sued to recover $116,316 under the assignment, Strong filed counterclaims, which were resolved in state court. A jury awarded Strong $2,293,878.70. The Tennessee Court of Appeals affirmed. The Firm filed suit in federal court, seeking a declaratory judgment, alleging that the Tennessee Court of Appeals judges made false statements in a judicial opinion violating its rights to a “fair trial” under the Due Process Clause and “to access justice” under the Equal Protection Clause. The Sixth Circuit affirmed the dismissal of the suit and directed the Firm and its counsel to show cause why sanctions should not be assessed. The suit is barred by the Rooker-Feldman doctrine; the complaint essentially sought another round of state appellate review. The complaint failed to present a justiciable case or controversy. Federal courts “are not in the business of pronouncing that past actions which have no demonstrable continuing effect were right or wrong.” View "Larry E. Parrish, P.C. v. Bennett" on Justia Law

In 2002, GTL, a mutual reserve company that underwrites insurance policies, engaged Platinum to market its insurance products. After a customer sued both parties, GTL terminated the marketing agreement. In 2015, the lawsuit settled. GTL sued Platinum for breaching the marketing agreement. In 2017, in arbitration, GTL and Platinum entered a settlement agreement, resolving all the claims that had and could have been brought in that litigation and providing for “reasonably proportionate” attorneys fees to the prevailing party in any future litigation. Weeks before the parties executed the 2017 settlement, another customer sued GTL in Missouri. After the 2017 settlement agreement took effect, GTL filed a third-party complaint against Platinum in that Missouri lawsuit, claiming that Platinum breached the marketing agreement by failing to ensure its contractors’ compliance with regulations, GTL's guidelines, and requirements for advertising its insurance products, and GTL's Code of Ethical Market Conduct.Platinum sued GTL in federal court, arguing that the Missouri third-party complaint mirrored claims resolved by the 2017 settlement agreement and was therefore barred. The district court granted Platinum summary judgment and awarded $108,445.10 in attorneys fees (150% of the underlying damages award). The Seventh Circuit affirmed. The 2017 agreement bars the third-party complaint and the award of attorneys fees is “reasonably proportionate” to the underlying damages. View "Platinum Supplemental Insurance, Inc. v. Guarantee Trust Life Insurance Co." on Justia Law

Dr. Arunachalam sued multiple defendants alleging patent infringement and Racketeer Influenced and Corrupt Organizations Act (RICO), 18 U.S.C. 1962, violations. The case was assigned to Judge Andrews. Arunachalam added defendants, including Judge Andrews, and moved for the judge's recusal. The court referred the matter to Chief Judge Stark. Arunachalam then moved to recuse Stark, who denied that motion and dismissed Judge Andrews as a defendant. Judge Andrews denied Arunachalam’s motion to recuse and dismissed several counts, explaining that “[p]atent infringement is not a crime,” and not a RICO predicate. Arunachalam unsuccessfully moved to vacate the dismissal and, again, to recuse Andrews. A motion for leave to amend was denied as violating local rules, “in bad faith.” Only the infringement claims remained. Meanwhile, the Patent Trial & Appeal Board (PTAB) found the claims at issue unpatentable. After the appeals period expired, Arunachalam opposed a motion to dismiss, arguing that “the lawless misconduct and ... fraud by the PTAB and the Federal Circuit . . . voids their rulings.”In a motion for sanctions, the defendants noted that Arunachalam had re-asserted her RICO claim in another district court. The court awarded attorneys’ fees for “defending against a baseless racketeering lawsuit,” but did not rule on the specific amounts. Arunachalam continued to file motions and questions that required responses, including requests that Judge Andrews and “attorneys of record” produce their oaths of office, “foreign registration statements,” and “bond” and “insurance information.” The Federal Circuit affirmed awards totaling about $150,000, and denial of Arunachalam’s “frivolous” motions. Arunachalam’s “abusive” litigation conduct warranted monetary sanctions and her later-filed motions were baseless and untimely. View "Arunachalam v. International Business Machines Corp." on Justia Law