Justia Legal Ethics Opinion Summaries

Blume Construction, Inc. appealed a district court judgment affirming a Job Service North Dakota decision, finding Blume did not file a valid appeal and the agency's determination assigning Blume a final penalty tax rate. Blume received a notice of determination from Job Service informing Blume that it would be assigned a penalty tax rate for unemployment insurance. The notice stated the agency conducted an audit and concluded there was a transfer of ownership and payroll between Blume and another company that was knowingly done to obtain a lower tax rate for unemployment insurance. The notice informed Blume it would be assigned the highest tax rate assignable for the next three years. The notice advised Blume the determination would become final unless a written appeal was made to Job Service within fifteen days. Job Service received an electronic appeal request for Blume signed by Craig Fidler. Fidler was identified as a licensed attorney from Colorado. Fidler was not licensed to practice law in North Dakota. In approximately May 2014, Fidler notified the referee he was unable to secure a sponsoring attorney licensed in North Dakota. During that same time period, the referee was informed a North Dakota attorney would be representing Blume. Blume argued the referee erred in finding Blume's attorney engaged in the unauthorized practice of law and the appealed request the attorney filed was void. Finding no reversible error, the Supreme Court affirmed. View "Blume Construction, Inc. v. North Dakota" on Justia Law

Plaintiff Bruce Kaye, the controlling principal of three entities that sold and managed timeshare interests in resort properties in Atlantic County, hired defendant Alan Rosefielde, an attorney admitted to practice law in New York but not in New Jersey, initially as outside counsel, and then as an employee. After defendant had worked closely with plaintiff for approximately four months, the parties entered an agreement providing that, as compensation for his services, defendant would earn an annual salary of $500,000. For approximately two years, defendant served as Chief Operating Officer for several of the timeshare entities, and effectively functioned as their general counsel. In that capacity, defendant committed serious misconduct by acting on his own behalf instead of for his employers benefit, and exposing his employers to potential liability. Based on this misconduct, and dissatisfaction with defendant’s performance, plaintiff terminated defendant’s employment. Kaye, in his individual capacity and as trustee of two trusts, Kaye’s son Jason Kaye, and the business entities that Kaye owned, sued Rosefielde and several other entities. Plaintiffs asserted claims based on Rosefielde’s breach of fiduciary duty, fraud, legal malpractice, unlicensed practice of law, and breach of the duty of loyalty. Following a lengthy bench trial, the trial court found that Rosefielde engaged in egregious conduct constituting a breach of his duty of loyalty, breach of his fiduciary duty, legal malpractice, and civil fraud. The trial court rescinded Rosefielde’s interest in several entities, awarded compensatory damages, punitive damages, and legal fees, and dismissed Rosefielde’s counterclaims. It declined, however, to order the equitable disgorgement of Rosefielde’s salary as a remedy for his breach of the duty of loyalty, on the ground that his breach did not result in damage or loss to the entities that employed him. The Appellate Division affirmed that determination, and the New Jersey Supreme Court granted certification on the issue of equitable disgorgement. “In imposing the remedy of disgorgement, depending on the circumstances, a trial court should apportion the employee’s compensation, rather than ordering a wholesale disgorgement that may be disproportionate to the misconduct at issue. . . . If an agent is paid a salary apportioned to periods of time, or compensation apportioned to the completion of specified items of work, he is entitled to receive the stipulated compensation for periods or items properly completed before his renunciation or discharge. This is true even if, because of unfaithfulness or insubordination, the agent forfeits his compensation for subsequent periods or items.” The judgment of the Appellate Division was reversed with respect to the remedy of equitable disgorgement, and the matter was remanded to the trial court to decide whether plaintiffs were entitled to disgorgement. If so, the trial court should apportion Rosefielde’s compensation, ordering disgorgement only for monthly pay periods in which he committed acts of disloyalty. View "Kaye v. Rosefielde" on Justia Law

Plaintiff filed suit against Mehusa, her former employer, for unpaid overtime, unpaid wages, and violation of California's Equal Pay Act, Labor Code 1197.5. After plaintiff prevailed on her Equal Pay Act claim and defendant prevailed on plaintiff's overtime and wage claims, the trial court awarded plaintiff her attorney fees and defendant its attorney fees and costs. The trial court offset the attorney fees awards for a net award to plaintiff of $3,709.19. Plaintiff appealed, arguing that the trial court erred in ruling that defendant was a prevailing party on plaintiff’s wage claim and awarding defendant attorney fees and costs under section 218.5. The court held in the published portion of this opinion that when there are two fee shifting statutes in separate causes of action, there can be a prevailing party for one cause of action and a different prevailing party for the other cause of action. Accordingly, the court affirmed the judgment. View "Sharif v. Mehusa, Inc." on Justia Law

Plaintiffs filed suit against defendants under the Fair Labor Standards Act (FLSA), 29 U.S.C. 201 et seq., and the New York labor Law (NYLL). After plaintiffs prevailed, the district court awarded plaintiffs' counsel $514,284.00 in attorneys’ fees and $68,294.50 in costs. Of that amount, it awarded $10,425 to reimburse plaintiffs' counsel for costs incurred retaining an expert accountant for plaintiffs' affirmative case against defendants. Defendants appealed, arguing that the district court’s award of fees and costs constituted an abuse of discretion. The court concluded that because section 216(b) does not explicitly authorize awards reimbursing plaintiffs for expert fees, the district court erred in granting such an award pursuant to this provision. Therefore, the court vacated the district court’s award of $10,425 in costs for expert fees and remanded to the district court to consider whether the NYLL authorizes the award of such fees and, if so, whether to award them pursuant to the NYLL. In a summary order issued simultaneously with this opinion, the court affirmed in part and reversed in part as to defendants' other challenges. View "Gortat v. Capala Bros." on Justia Law

Plaintiffs filed suit against defendants under the Fair Labor Standards Act (FLSA), 29 U.S.C. 201 et seq., and the New York labor Law (NYLL). After plaintiffs prevailed, the district court awarded plaintiffs' counsel $514,284.00 in attorneys’ fees and $68,294.50 in costs. Of that amount, it awarded $10,425 to reimburse plaintiffs' counsel for costs incurred retaining an expert accountant for plaintiffs' affirmative case against defendants. Defendants appealed, arguing that the district court’s award of fees and costs constituted an abuse of discretion. The court concluded that because section 216(b) does not explicitly authorize awards reimbursing plaintiffs for expert fees, the district court erred in granting such an award pursuant to this provision. Therefore, the court vacated the district court’s award of $10,425 in costs for expert fees and remanded to the district court to consider whether the NYLL authorizes the award of such fees and, if so, whether to award them pursuant to the NYLL. In a summary order issued simultaneously with this opinion, the court affirmed in part and reversed in part as to defendants' other challenges. View "Gortat v. Capala Bros." on Justia Law

Plaintiff, on behalf of himself and others similarly situated, appealed the district court's dismissal of his putative collection action seeking damages from defendants for violations of the overtime provision of the Fair Labor Standards Act (FLSA), 29 U.S.C. 201 et seq. Plaintiff's complaint arose out of his work as a contract attorney in North Carolina. The court agreed with the district court’s conclusion that: (1) state, not federal, law informs FLSA’s definition of “practice of law;” and (2) North Carolina, as the place where plaintiff worked and lived, has the greatest interest in this litigation, and thus the court looks to North Carolina law to determine if plaintiff was practicing law within the meaning of FLSA. The court, however, disagreed with the district court’s conclusion, on a motion to dismiss, that by undertaking the document review plaintiff allegedly was hired to conduct, he was necessarily “practicing law” within the meaning of North Carolina law. The court found that accepting the allegations as pleaded, plaintiff adequately alleged in his complaint that his document review was devoid of legal judgment such that he was not engaged in the practice of law, and remanded for further proceedings. View "Lola v. Skadden, Arps, Slate, Meagher & Flom" on Justia Law

Hess, an attorney, had worked on a number of medical-malpractice cases before his law firm, Kanoski terminated his employment. Many of these cases settled after Hess’s termination, and Hess was not compensated. He sued under his employment agreement and under the Illinois Wage Payment and Collection Act, adding claims of tortious interference, wrongful discharge, unjust enrichment, and quantum meruit. In 2011, the district court dismissed each of Hess’s claims. On remand the district court held that Hess was not entitled to compensation for the post-termination settlements. The Seventh Circuit affirmed, based on its interpretation of Hess’s employment contract provisions that Hess would receive bonus pay in the amount of 15 percent of all fees “generated over the base salary (or $5,000 per month),” that the bonus shall increase to 25 percent “on all fees received annually in excess of $750,000.00,” and that that, “where the Corporation retains clients upon Employees [sic] termination that Employee has no proprietary interest in fees to be earned since the Employee is to be fully compensated through his salary and/or bonus for all work done while an Employee of the Corporation.” View "Hess v. Kanoski & Associates" on Justia Law

Cypress sued, alleging that Maxim, had misappropriated a trade secret, or was in the process of doing so, by seeking to hire away specialists in touchscreen technology, a field in which Cypress and Maxim compete. Maxim responded that it was entitled to solicit prospective employment candidates in Cypress’s workforce and that there was no evidence it had acquired, or was seeking to acquire, any trade secret. After failing to secure temporary injunctive relief, and failing to obtain an order placing under seal evidence derived by Maxim from public sources, Cypress dismissed the action. The trial court awarded Maxim attorney fees under Civil Code 3426.4, which authorizes such an award to the prevailing party where a claim for misappropriation of trade secrets is found to have been made in bad faith. The court of appeal affirmed, stating that the finding of bad faith was amply supported by evidence that defendants did no more, and Cypress accused them of no more, than attempting to recruit the employees of a competitor. Cypress dismissed the suit to avoid an adverse determination on the merits. View "Cypress Semiconductor Corp. v. Maxim Integrated Prods., Inc." on Justia Law

Ragozzine was a tenure-track professor at Youngstown State University. He did not produce much scholarship. Ragozzine attributed the delay to his lab’s not being fully operational until his second academic year. In his fifth academic year, his mother and his wife fell ill, with some caretaking responsibilities falling on him. He was granted a year’s delay in the review of his tenure application. Although he met the minimum requirements with a last-minute flurry of publications, he was denied tenure because YSU determined that he lacked promise of consistent scholarly production. Ragozzine sued, alleging that he was discriminated against on the basis of sex in violation of Title VII and the Equal Protection Clause; that YSU violated his rights under the Family Medical Leave Act, and that irregularities in his tenure review violated his procedural and substantive due process rights. The district court granted the defendants summary judgment. Ragozzine subsequently moved to disqualify the judge, based on a previously undisclosed dating relationship between the judge and a YSU faculty member, arguing that the relationship created an appearance of impropriety under 28 U.S.C. 455 and the Code of Conduct for Judges. The district court denied that motion, concluding that no reasonable person would question her impartiality. The Sixth Circuit affirmed. View "Ragozzine v. Youngstown State Univ." on Justia Law

Colosi lost a wrongful termination suit against her former employer, JLL. As the prevailing party, JLL filed a $6,369.55 bill of costs that the court clerk approved without modification, Fed. R. Civ. P. 54(d)(1). Colosi objected to most of the charges and moved to reduce the bill to $253.50. The district court denied the motion, finding each cost reasonable, necessary to the litigation, and properly taxable under statute, 28 U.S.C. 1920. The Sixth Circuit affirmed. Most of the costs Colosi challenged related to witness depositions. Necessity is determined as of the time of taking, and the fact that a deposition is not actually used at trial is not controlling. View "Colosi v. Jones Lang LaSalle Am., Inc." on Justia Law