Justia Legal Ethics Opinion Summaries

The Supreme Court affirmed the stipulation entered into between Judge Dennis Daniel Bailey and the Judicial Qualifications Commission that stipulated that Judge Bailey violated the Code of Judicial Conduct and should be publicly reprimanded and commanded Judge Bailey to appear before the Court for the administration of a public reprimand.Based on the judge's conduct in a certain trial, the commission charged Judge Bailey with violating canons 1, 2A, 3B(1), 3B(4), and 3B(7) of the Florida Code of Judicial Conduct. The commission found probable cause for the violations and recommended that Judge Bailey be publicly reprimanded. Judge Bailey stipulated that he did not contest the commission's findings and accepted the recommended discipline. The Supreme Court agreed with the commission's findings and Judge Bailey's admissions and ordered that Judge Bailey appear for the administration of a public reprimand. View "Inquiry Concerning a Judge Dennis Daniel Bailey" on Justia Law

Chase sued to recover millions of dollars under a credit agreement "between Chase and entities owned and operated by [Winget]” and obtained an award of over $425 million. Winget’s personal trust was liable for the full amount. Winget, protected by a limitation in his personal guaranty, owed Chase only $50 million, which he paid. The parties then litigated attorneys’ fees and whether Winget was personally liable for Chase’s $12.6 million in fees and expenses. The Sixth Circuit held that despite Winget’s limited personal guaranty, he “is still liable for Chase’s costs and expenses associated with collection of the Guaranteed Obligation.” The district court then entered a final amended judgment against Winget and his trust. Rather than use the trust’s assets to pay Chase, Winget transferred the assets out of his trust and filed a new lawsuit, seeking a declaration that Chase had no recourse against those assets. Chase filed counterclaims, alleging that the transfers were fraudulent conveyances. The district court consolidated the new lawsuit with the previous litigation, calling it “the functional equivalent of post-judgment proceedings,” and granted one motion, awarding Chase another $2 million for expenses from June 2015 through November 2016. The court noted that “Chase’s efforts to collect the Guaranteed Obligations are ongoing.” The Sixth Circuit dismissed an appeal for lack of jurisdiction, reasoning that the order is not a “final decision” under 28 U.S.C. 1291. View "JPMorgan Chase Bank, N.A. v. Winget" on Justia Law

David Calvert was disbarred for various ethical violations, including entering into an oral agreement with a client without complying with the requisite safeguards of Colorado Rule of Professional Conduct 1.8(a). After being disbarred, Calvert sued his former client, Diane Mayberry, for breach of that same oral agreement, claiming that there was a contract between them. The trial court granted Mayberry’s motion for summary judgment, and the court of appeals affirmed. On appeal to the Colorado Supreme Court, Calvert challenged: (1) whether an attorney who was found to have violated Rule 1.8(a) in a disciplinary proceeding was estopped from relitigating the same factual issues in a civil proceeding; (2) whether a contract between an attorney and a client entered into in violation of Rule 1.8(a) was enforceable; and (3) whether the trial court abused its discretion in awarding attorney’s fees against Calvert after finding his lawsuit groundless and frivolous. The Colorado Supreme Court declined the issue preclusion issue raised because Calvert conceded he could not relitigate whether he entered into an agreement with a client without meeting Rule 1.8(a)’s requirements. The Court held that when an attorney enters into a contract without complying with Rule 1.8(a), the contract was presumptively void as against public policy; however, a lawyer may rebut that presumption by showing that, under the circumstances, the contract does not contravene the public policy underlying Rule 1.8(a). Further, the Court held the trial court did not abuse its discretion in awarding attorney’s fees at the trial level because the record supported the finding that the case was groundless, frivolous, and brought in bad faith. But as to attorney’s fees at the appellate level, because the questions of whether issue preclusion applied in this proceeding and whether a contract made in violation of Rule 1.8(a) is void as against public policy were legitimately appealable issues, thereby making a grant of appellate attorney’s fees inappropriate. Therefore, the Supreme Court affirmed the court of appeals as to the merits on other grounds, affirmed the award of attorney’s fees at the trial level, and reversed the court of appeals’ order remanding for a determination of appellate attorney’s fees. View "Calvert v. Mayberry" on Justia Law

The Debtors filed their bankruptcy petition in 2008. Grusin provided them legal advice before the filing and at the beginning of the bankruptcy case. Fullen filed the petition and represented them in the chapter 7 case. In 2011, the bankruptcy court granted the Trustee summary judgment in an adversary proceeding seeking to deny the Debtors’ discharge and disqualified both lawyers from further representation of the Debtors in that case. The Debtors hired new counsel, who obtained relief from the summary judgment order. Following a trial, in 2015, the bankruptcy court again denied the Debtors’ discharge. The Bankruptcy Appellate Panel affirmed. In 2012, the bankruptcy court granted CJV derivative standing to pursue a malpractice action on behalf of the estate against Grusin and Fullen. Malpractice complaints were filed in the bankruptcy court and in Tennessee state court. In 2014, CJV filed another adversary proceeding, seeking declaratory relief that the malpractice claims constituted property of Debtors’ estate. The Bankruptcy Appellate Panel affirmed the bankruptcy court in holding that the malpractice action for denial of debtors’ discharges based on errors and omissions contained in a bankruptcy petition, as well as pre and post-petition legal advice, was not property of the debtors’ bankruptcy estate. There was no pre-petition injury; the Debtors were injured by that negligence when their discharges in bankruptcy were denied. View "In re Blasingame" on Justia Law

The Supreme Court adopted the findings of the Board of Professional Conduct that Judge Robert Nathaniel Rusu Jr., the Mahoning County Probate Court judge, violated several rules of the Code of Judicial Conduct and publicly reprimanded Rusu for his misconduct.The Board found that Rusu's conduct of presiding over cases in which Judge Rusu previously served as an attorney of record and failed to take reasonable steps to protect his clients' interests after terminating his representation violated Jud.Cond.4. 1.2 and 2.11(A) and Prof.Cond.R. 1.16(d). The Supreme Court adopted the Board's findings and, after considering the misconduct, the mitigating factors, and the sanctions imposed for comparable misconduct, agreed that public reprimand was the appropriate sanction. View "Disciplinary Counsel v. Rusu" on Justia Law

HSBC obtained a foreclosure judgment against the Lisses. To extend the time for appeal of that judgment, attorney Nora filed two bankruptcy petitions and multiple appeals, accusing HSBC and its attorney of federal crimes and seeking sanctions. The district court ultimately ordered Nora and her client to pay damages and costs related to the bankruptcy litigation and suspended her from the practice of law in the Western District of Wisconsin. The Seventh Circuit affirmed, noting that this was not Nora’s first encounter with attorney discipline. Nora’s attempt to relitigate HSBC’s foreclosure judgment in bankruptcy court was frivolous; her stall tactics were “blatant.” Such litigation behavior—even assuming pure motives—constitutes objective bad faith warranting sanctions under 28 U.S.C. 1927. The court noted “her serial dilatory, vexatious, and unprofessional litigation practices” and frivolous motion practice and legal arguments in her appeals. Flippant, unfounded accusations of misconduct and fraud by opposing counsel and court officials demean the profession and impair the orderly operation of the judicial system. View "Nora v. HSBC Bank USA, N.A." on Justia Law

Hamilton had been employed by the EEOC for 20 years, with no disciplinary problems, until one day in 2016, when, while engaged in mediation, he suddenly began using racial epithets, engaging in physical violence, and refusing to follow orders. The EEOC removed him from federal service. The union filed a grievance, which led to arbitration. During a hearing, the EEOC called 11 witnesses; the union called Hamilton. Although the arbitrator found that certain aspects of the EEOC’s case had not been proved, he credited the testimony of EEOC witnesses to conclude that Hamilton “had a major physical and/or mental breakdown.” Because Hamilton denied taking any of the actions he was charged with, the arbitrator concluded that Hamilton “did not remember.” The arbitrator found that the EEOC had not shown that Hamilton’s behavior had any negative effect on its reputation and had failed to consider that Hamilton’s behavior “was caused by his obvious medical condition,” and set aside Hamilton’s removal, awarding back pay. The arbitrator denied the union’s request for arbitration costs and attorney fees. The Federal Circuit vacated the denial of attorneys’ fees; 5 U.S.C. 7701(g) provides that an adjudicator may require an agency to pay the employee’s reasonable attorney fees if the employee is the prevailing party and the adjudicator determines that payment by the agency “is warranted in the interest of justice.” On remand, the arbitrator must reconsider the issue and include a statement of reasons. View "AFGE Local 3599 v. Equal Employment Opportunity Commission" on Justia Law

In July 2012, Maguire, represented by attorney Bornstein, brought an unlawful detainer action against Connelly. In September 2012, Maguire voluntarily dismissed the unlawful detainer action. On September 16, 2014, Connelly sued Maguire and Bornstein for malicious prosecution, alleging the two “actively were involved in brin[g]ing and maintaining” the unlawful detainer action, which ended in appellant’s favor; “no reasonable person in [Maguire and Bornstein’s] circumstances would have believed that there were reasonable grounds” to bring and/or maintain the action; and Maguire and Bornstein “acted primarily for a purpose other than succeeding on the merits” of the action. The trial court dismissed, citing the one-year statute of limitations in Code of Civil Procedure section 340.6(a), governing “[a]n action against an attorney for a wrongful act or omission, other than for actual fraud, arising in the performance of professional services.” The court of appeal affirmed, recognizing that finding section 340.6(a) applicable to malicious prosecution claims against attorneys will result in a one-year statute of limitations for such claims, while a two-year statute of limitations will apply to malicious prosecution claims against litigants. View "Connelly v. Bornstein" on Justia Law

The Fifth Circuit vacated the district court's denial of attorneys' fees in plaintiff's action under the Americans with Disabilities Act (ADA). Although the district court correctly determined that Farrar v. Hobby, 506 U.S. 103 (1992), provided the relevant legal framework in this case, the court held that the district court was in the best position to determine whether this lawsuit achieved a compensable public goal justifying a fee award. Plaintiff argued that this was an unusual case justifying a fee award because the litigation secured an ASL interpreter for Nelson Arce, achieved recognition of the rights of deaf probationers and prisoners to disability accommodations, deterred future ADA violations, and prompted necessary reforms in the defendants' policies toward deaf individuals. Accordingly, the court remanded for further proceedings. View "Shelton v. Louisiana State" on Justia Law

After Brown Sims, a Houston law firm, successfully obtained a favorable result for its client, AJR, the client colluded with the opposing party, CNA and its attorneys, to consummate a settlement just between themselves. After settlement, the district court dismissed the case as moot.The Fifth Circuit held that the district court had subject matter jurisdiction over Brown Sims's claims against CNA. The court also held that Brown Sims met all of Federal Rule of Civil Procedure 24's criterion for intervention as of right and the district court erred in concluding otherwise. Furthermore, the district court erred in denying the Rule 60(b)(5) and (b)(6) motions. Accordingly, the court reversed in part, vacated in part, and remanded for further consideration. View "Adam Joseph Resources v. CNA Metals Limited" on Justia Law