Justia Legal Ethics Opinion Summaries

Moje, playing minor league hockey, lost an eye during a game, and sued Oakley, which made his visor, and the League. Instead of notifying its insurer, the League hired LoFaro. Oakley’s attorney called the League’s President, to ask why it had not answered the complaint. LoFaro claimed that an answer had been filed, but the docket did not reflect any filing. Moje moved for default. LoFaro did not respond, nor did he respond after the court entered the default and permitted Moje to prove damages. The court entered a final judgment of $800,000 against the League. After the League learned of collection efforts, it notified its insurer. A lawyer hired by the insurer unsuccessfully moved, under Fed. R. Civ. P. 60(b)(1) to set aside the judgment within six months of its entry. Rule 60(b)(1), allows relief on account of “mistake, inadvertence, surprise, or excusable neglect.” The Seventh Circuit affirmed. Abandoned clients who take reasonable steps to protect themselves can expect to have judgments reopened under Rule 60(b)(1), but the League is not in that category. Its remedy is against LoFaro. View "Moje v. Federal Hockey League LLC" on Justia Law

Plaintiffs (a class of 1,593) alleged that Visteon failed to deliver timely notice to ex-employees, offering them an opportunity to continue health insurance at their own expense, under the Consolidated Omnibus Budget Reconciliation Act of 1985 (COBRA). An employer has 44 days after the end of a person’s employment to provide notice and essential details, 29 U.S.C. 1166(a)(2). The court found that Visteon had provided untimely notice to 741 former employees, and that the notice averaged 376 days late for those persons. The court awarded $2,500 to each class member who had received untimely notice (a total of about $1.85 million), a sum that does not depend on how long the delay was for any given person. While the suit was pending, Visteon was reorganized in bankruptcy. The plan provides that debts of this kind will be paid 50¢ on the dollar, so each of the 741 will receive $1,250. The court also ordered Visteon to pay class counsel $302,780 as attorneys’ fees plus costs of about $11,000. The Seventh Circuit affirmed the award of attorneys’ fees, but otherwise dismissed plaintiffs’ challenge to the penalty as untimely, having been filed several months after the district court’s delayed entry of judgment. View "Pierce v. Visteon Corp." on Justia Law

The United States filed a petition for a writ of mandamus challenging a district judge’s policy restricting the pro hac vice admission of government attorneys. After the petition was filed, the district judge reversed his previous order denying an attorney in this case pro hac vice admission. The court concluded that the case was not moot and that the controversy remains live where it was reasonably likely that the judge will again deny the pro hac vice applications of attorneys for the United States; while the reversal of the challenged order did not render this controversy moot, it rendered a formal writ of mandamus a superfluous or ineffective remedy here; in this case, the judge acted outside his discretion by failing to provide a valid reason to deny the attorney's application for pro hac vice admission; the judge committed clear error; the first and second Bauman v. U.S. District Court factors weighed in favor of issuing mandamus when the petition was filed, and weigh in favor of offering guidance to the district court; the fact that the judge's order in this case was not an isolated occurrence weighed in favor of granting mandamus relief when the petition was filed; the district court's order raises important problems or issues of first impression and weighed in favor of mandamus relief when the petition was filed and weighs in favor of offering guidance to the district court even though a formal writ is no longer necessary; and issuing a formal writ would have been an appropriate remedy but for the judge’s voluntary cessation. Accordingly, the court denied the petition without prejudice. View "USA V. USDC-NVR" on Justia Law

The Court of Criminal Appeals held David Dow, a post-trial capital defense attorney, in contempt for violating Court of Criminal Appeals Miscellaneous Rule 11-003 and suspended him from practicing before it for one year. Dow filed this original proceeding seeking mandamus and declaratory relief in the Supreme Court, contending that the Court of Criminal Appeals exceeded its authority in imposing the sanction. The Supreme Court dismissed Dow’s petition, holding (1) the Court does not have jurisdiction under the Constitution over Dow’s petition for mandamus relief; and (2) because the Court lacked mandamus jurisdiction, it also lacked jurisdiction to grant declaratory relief. View "In re Dow" on Justia Law

Gaymar ‘s patent is directed to a patient temperature control system, including a blanket that can conductively warm or cool the patient. In 2008, Gaymar sued CSZ, asserting that CSZ’s Blanketrol device infringed claims of the patent. The PTO granted CSZ’s inter partes reexamination request and issued a first Office Action rejecting all claims of the patent as anticipated or obvious over prior art cited in CSZ’s request. The district court denied Gaymar’s motion for a preliminary injunction and granted CSZ’s motion to stay the case pending the conclusion of the reexamination. The PTO reaffirmed its rejection of all claims of the patent. Gaymar filed an express abandonment of all claims in 2010, and the PTO concluded the reexamination, cancelling all of the claims. The district court lifted the stay. CSZ unsuccessfully sought attorney’s fees under 35 U.S.C. 285, alleging that Gaymar’s litigation position was frivolous and that Gaymar had engaged in litigation misconduct. Following the Supreme Court’s 2014, decision, Octane Fitness, CSZ unsuccessfully moved for reconsideration. The Federal Circuit affirmed a finding of a lack of objective baselessness, but reversed the exceptional case finding insofar as it was based on CSZ’s purported misconduct. View "Gaymar Indus., Inc. v. Cincinnati Sub-Zero Prods., Inc." on Justia Law

SGI sued Yogi’s, alleging trademark infringement. Attorney Harris filed trademark applications for Yogi’s. SGI served Harris with a subpoena, for his deposition. The deposition did not take place. The court ordered Harris to be deposed at his office at noon on October 29. SGI sent Harris, who did not attend the hearing, a copy of the order by mail and facsimile on October 23. On October 29, SGI’s attorney, Park, arrived at the office. Harris was not there. The two spoke by phone. According to Park, Harris stated that he was aware of the order, but that it would take him at least an hour to arrive. Park told Harris that if he did not arrive by 1:00 p.m. it would be treated as a “no show.” The deposition did not occur. Harris faxed a letter stating his intention to comply and willingness to be deposed telephonically or by video. SGI did not respond or attempt to reschedule, but moved to hold Harris in contempt, seeking fees and expenses of $6,800. Harris filed an affidavit, explaining that during the week of October 22, he was in New York, and that he first became aware of the court order on October 29, when speaking with Park. On November 6, Harris sent Park a letter via email, facsimile, and certified mail, stating that he was available for deposition. On November 8, Harris called Park to reschedule. Park did not return the call; Harris sent another email. There was no response. On December 17, the court ordered SGA to take Harris’ deposition that same day. SGI complied. The court declared the motion for contempt and sanctions moot. SGI filed a renewed motion. The Seventh Circuit affirmed its denial. View "Sik Gaek, Inc. v. Harris" on Justia Law

ASARCO hired the law firms to assist it in carrying out its duties as a Chapter 11 debtor in possession, 11 U.S.C. 327(a). When ASARCO emerged from bankruptcy, the law firms filed fee applications requesting fees under section 330(a)(1), which permits bankruptcy courts to “award . . . reasonable compensation for actual, necessary services rendered by” professionals. The Bankruptcy Court rejected ASARCO’s objections and awarded fees for time spent defending the applications. The district court held that the firms could be awarded fees for defending their fee applications. The Fifth Circuit reversed. The Supreme Court affirmed. Section330(a)(1) does not permit bankruptcy courts to award fees to section 327(a) professionals for defending fee applications. The American Rule provides the basic point of reference for attorney’s fees: Each litigant pays his own attorney’s fees, win or lose, unless a statute or contract provides otherwise. Congress did not depart from the American Rule in section 330(a)(1) for fee-defense litigation. The phrase “reasonable compensation for services rendered” necessarily implies “loyal and disinterested service in the interest of” a client, Time spent litigating a fee application against the bankruptcy estate’s administrator cannot be fairly described as “labor performed for”—let alone “disinterested service to”—that administrator. Requiring bankruptcy attorneys to bear the costs of their fee-defense litigation under section 330(a)(1) creates no disincentive to bankruptcy practice. View "Baker Botts L.L.P. v. ASARCO LLC" on Justia Law

The City of Milwaukee is defending several lawsuits brought by scores of plaintiffs alleging that its police officers conducted unconstitutional stops and searches, including strip‐searches and body‐cavity searches. Judge Stadtmueller was assigned to preside over several cases. Milwaukee, asserting that some of the judge’s comments in opinions and conferences in the related cases raise questions about his impartiality, moved for recusal under 28 U.S.C. 455(a). The judge declined. Milwaukee sought a writ of mandamus. The Seventh Circuit denied the motion. The five challenged statements were made during the course of litigation; “opinions formed by the judge on the basis of facts introduced or events occurring in the course of the current proceedings, or of prior proceedings, do not constitute a basis for a bias or partiality motion unless they display a deep‐seated favoritism or antagonism that would make fair judgment impossible.” Judge Stadtmueller is presiding over several of these cases. It is not surprising that he might draw conclusions about the nature of the issue or problem. He is expected to look for and consider common threads and possible systemic problems to manage the cases effectively and decide them fairly. Even considering all the challenged statements together, nothing reasonably suggests deep-seated antagonism. View "City of Milwaukee v. Stadtmueller" on Justia Law

Plaintiffs filed a pro se complaint on behalf of two estates, claiming that financial institutions fraudulently transferred real estate in Shelby County, Tennessee, and failed to follow proper procedures for selling properties encumbered by outstanding liens. The district court dismissed on the ground that a non-attorney cannot appear in court on behalf of an artificial entity such as an estate, even though plaintiffs claimed that they were the sole beneficiaries of their respective estates. Each signed the notice of appeal as the “Authorized Representative” of the estates. Federal law allows parties to “plead and conduct their own cases personally or by counsel,” 28 U.S.C. 1654. The Sixth Circuit denied a motion to dismiss the appeal, holding that the sole beneficiary of an estate without creditors may represent the estate pro se. The purpose of protecting third parties is not implicated when the only person affected by a nonattorney’s representation is the nonattorney herself. The tradition that “a corporation can only appear by attorney,” has not been extended to estates. View "Bass v. Leatherwood" on Justia Law

Plaintiff Fraser Trebilcock Davis & Dunlap, P.C. provided legal services to the defendants, a group of trusts, in connection with the financing and purchase of four hydroelectric dams. Dissatisfied with the representation they received, defendants refused to pay the full sum of fees billed by Fraser Trebilcock. To recover these unpaid fees, Fraser Trebilcock brought the underlying suit against defendants for breach of contract. Pursuant to MCR 2.403, the matter was submitted for a case evaluation, which resulted in an evaluation of $60,000 in favor of Fraser Trebilcock. Fraser Trebilcock accepted the evaluation, but defendants rejected it. The case proceeded to trial, resulting in a verdict for Fraser Trebilcock and a judgment totaling $73,501.90. Throughout the litigation of this breach-of-contract action, Fraser Trebilcock appeared through Michael Perry (a shareholder of the firm) and other lawyers affiliated with the firm. At no point did Fraser Trebilcock retain outside counsel, and there was no indication that the firm entered into a retainer agreement with its member lawyers or received or paid a bill for their services in connection with the litigation. After receiving the verdict, the parties filed posttrial motions: defendants moved for a new trial, and Fraser Trebilcock moved for case-evaluation sanctions under MCR 2.403(O), seeking to recover, inter alia, a “reasonable attorney fee” under MCR 2.403(O)(6)(b) for the legal services performed by its member lawyers. The trial court denied the defendants’ motion for a new trial, and granted Fraser Trebilcock’s motion for case-evaluation sanctions, ruling in particular that Fraser Trebilcock could recover an attorney fee as part of its sanctions. The issue on appeal to the Supreme Court was whether the plaintiff law firm could recover, as case-evaluation sanctions under MCR 2.403(O)(6)(b), a “reasonable attorney fee” for the legal services performed by its own member lawyers in connection with its suit to recover unpaid fees from defendants. Contrary to the determinations of the trial court and the Court of Appeals majority, the Supreme Court concluded it could not. Accordingly, the Court of Appeals was reversed in part, the trial court's award of fees was vacated, and the case remanded for further proceedings. View "Frazier Trebilcock Davis & Dunlap, P.C. v. Boyce Trust 2350" on Justia Law