Justia Legal Ethics Opinion Summaries

The Ninth Circuit reversed the district court's denial of debtors' motion under 11 U.S.C. 362(k) for attorneys' fees incurred on appeal in successfully challenging the bankruptcy court's award of attorneys' fees to debtors for a willful violation of an automatic stay. The panel held that section 362(k) also authorizes attorneys' fees and costs to the debtor incurred on appeal in successfully challenging an initial award made pursuant to section 362(k).The panel also held that the district court abused its discretion by denying the motion on the alternative ground that debtors failed to comply with a local rule. In this case, the memorandum of points and authorities filed with the district court sufficiently clarified the attorneys' fees and costs. The panel remanded for further proceedings. View "Easley v. Collection Service of Nevada" on Justia Law

Carlson was co-lead counsel representing the plaintiffs in the CBNV litigation. He began working on the case while an associate with the SSEM firm and continued working on it after he left the firm. He entered into agreements with SSEM regarding how fees recovered in CBNV and other cases would be allocated. After the final order approving the CBNV class settlement and fee award, SSEM filed a state court breach of contract action against Carlson, alleging that he owed the firm part of his CBNV fees. Carlson moved the federal district court, which had handled the CNBV litigation, to stay the state case and confirm his fee award. That court exercised ancillary jurisdiction to stay the state case and granted Carlson’s motion, concluding that SSEM was not entitled to any portion of the Carlson's fee because a condition precedent had not occurred. The Third Circuit reversed. The district court erred in exercising ancillary jurisdiction over the state contract dispute because it did not retain jurisdiction over disputes arising from the allocation of fees, the state law contract claim is factually distinct from the federal CBNV claims, exercising ancillary jurisdiction was not necessary to resolve matters properly before it, and the court had no control over the funds SSEM seeks. View "In Re: Community Bank of Northern Virginia Mortgage Lending Practices Litigation" on Justia Law

As part of an internal affairs investigation regarding the unauthorized disclosure of a confidential police report, the San Diego Police Department (Department) questioned plaintiff/real party Dana Hoover, a detective for the Department, regarding the content of communications between Hoover and an attorney representing her in an employment-related lawsuit against defendant/petitioner City of San Diego. Although Hoover invoked the privilege, the Department directed her to answer the internal affairs questions or face discipline and/or termination of employment. The Court of Appeal found the trial court properly concluded that the City violated the attorney-client privilege when Department investigators insisted Hoover respond to questions despite her invocation of the privilege. A deputy city attorney attending the interview as an observer also violated the California State Bar Rules of Professional Conduct when she began questioning Hoover about her lawsuit without the permission of her lawyer in the case. Hoover filed a motion to disqualify the City Attorney in her lawsuit. The Court of Appeal found disqualification of counsel, was a drastic remedy that should be ordered only where the violation of the privilege or other misconduct has a "substantial continuing effect on future judicial proceedings." The Court found the transcript of the internal affairs interview demonstrated that although relevant confidential information could in theory have been elicited in response to the internal affairs questions, in fact no such information was disclosed. Under these circumstances, because "a disqualification order must be prophylactic, not punitive" the drastic remedy of depriving a party of its counsel of choice was unwarranted. The Court issued a writ of mandate to direct the trial court to vacate its order granting Hoover’s motion to disqualify the San Diego City Attorney. View "City of San Diego v. Superior Court" on Justia Law

Attorney Beverly Gassner filed suit against her former client Loretta Stasa for unpaid fees. Gassner was represented by the Grossman firm. In 2016, Gassner voluntarily dismissed the action without prejudice. The trial court awarded costs - not only against the plaintiff, but also against the Grossman firm. The plaintiff moved to vacate the costs order, but the trial court denied that motion. The Grossman firm appealed. With regard to the order awarding costs, the Court of Appeal determined there was a split of authority as to whether such an order was appealable when it was made after a voluntary dismissal without prejudice. The Court followed the case law holding that it was appealable. The Grossman firm, however, failed to file a timely appeal of that order. With regard to the order denying the motion to vacate, ordinarily such an order was not appealable on grounds that could have been raised in an appeal from the underlying order. This bar does not apply, however, when the underlying order is void. "Moreover, the appeal is timely with respect to this order." On the merits, the Court held that the order awarding costs against the Grossman firm was indeed void, because the Grossman firm was not a party. Accordingly, the Court reversed the trial court's order. View "Gassner v. Stasa" on Justia Law

Spineology’s patent describes an “expandable reamer” for use in orthopedic surgery. Wright manufactures a reamer known as the X-REAM®. In 2015, Spineology sued Wright, alleging the X-REAM® infringes its patent. The district court refused to adopt either party’s construction of the term “body” but construed “body” consistent with Wright’s noninfringement position and granted Wright summary judgment. Wright then sought attorney fees, 35 U.S.C. 285, arguing Spineology’s proposed construction of “body,” its damages theories, and its litigation conduct rendered the case “exceptional.” The Federal Circuit affirmed the denial of the motion. While ultimately the court rejected Spineology’s proposed construction, the attempt was not so meritless as to render the case exceptional. The court determined “the arguments made by Spineology to support its damages theory . . . are not so meritless as to render the case exceptional” and “[n]othing about this case stands out from others with respect to the substantive strength of Spineology’s litigating position or the manner in which the case was litigated.” View "Spineology, Inc. v. Wright Medical Technology Inc." on Justia Law

T. Mark Sledge left the law firm Grenfell Sledge and Stevens, PLLC. When he did, an issue arose regarding the fee distribution for several of the firm’s and Sledge’s cases, more specifically, the interpretation of the firm’s partnership agreements and related documents. Sledge filed suit against his former firm and its individual members. Following a hearing, the Chancery Court granted the motion for summary judgment filed by Grenfell Sledge and Stevens, PLLC, and its individual members and also a declaratory judgment in their favor. Sledge challenged the chancery court’s rulings; however, the Mississippi Supreme Court was unpersuaded by his arguments on appeal and affirmed. View "Sledge v. Grenfell Sledge And Stevens, PLLC d/b/a Grenfell & Stevens, PLLC" on Justia Law

The issue this case presented for the Mississippi Supreme Court centered on release language in a settlement agreement. This case began as a legal malpractice action by Delie Shepard and Ashley Stowers (the Plaintiffs) against Robert Germany and his law firm, Pittman, Germany, Roberts & Welsh, LLP. Shepard and Stowers were represented by Michael Crowley and Edward Blackmon; Germany and his firm were represented by Fred Krutz and Daniel Mulholland. After several years of litigation and mediation, the parties reached a settlement. In the settlement, Shepard and Stowers agreed “to execute a Full and Complete Release.” The parties agreed to and memorialized the essential terms of their settlement in an email exchange. Although the essential terms were agreed upon, Crowley’s email to Krutz did not specify the precise language of the “Full and Complete Releases.” Believing that the parties had a meeting of the minds on the essential terms of the settlement in an email exchange, Germany moved to enforce the settlement agreement using the release language proposed by his attorneys. Shepard and Stowers later filed their own motion to enforce the settlement agreement using their proposed releases. Before Shepard and Stowers filed their motion, the circuit court held a hearing on Germany’s motion to enforce the settlement agreement. The circuit court entered an Order Enforcing Settlement Agreement and Judgment of Dismissal. Unsatisfied with the order enforcing the settlement agreement, which required their signature on the releases, Crowley and Blackmon filed an emergency petition for writ of prohibition with the Supreme Court, which was ordered to be treated as a Notice of Appeal. They later filed a notice of appeal in the underlying case on behalf of Shepard and Stowers. The appeal sought essentially the same relief as Crowley and Blackmon’s petition, so the Supreme Court consolidated the cases. The issue for the Supreme Court was whether the circuit court abused its discretion by enforcing a settlement agreement using specific release language that required the Plaintiffs’ attorneys’ signatures. Finding that the circuit court abused its discretion, the Supreme Court reversed the Order Enforcing Settlement Agreement and Judgment of Dismissal and remanded the case for further proceedings. View "Crowley v. Germany" on Justia Law

Pursuant to a former version of Code of Civil Procedure section 128.5, the trial court ordered CPF Vaseo Associates, LLC (CPF) and its counsel, John Byrne, to pay Bruce and Barbara Gray (the Grays) just over $30,000 in fees and costs. Yet a mandatory procedural prerequisite to that award was never fulfilled. The motion requesting sanctions was served and filed on the same day, and no safe harbor period was afforded for CPF and Byrne to correct the challenged conduct. While a panel of the Court of Appeal previously determined that no such safe harbor applied to a sanctions motion like the one here, the Legislature's subsequent clarifying amendment of the section and the contrary opinion of another court convinced the Court to now reach a different conclusion. For that reason, the Court reversed and remanded for further proceedings. View "CPF Vaseo Associates, LLC v. Gray" on Justia Law

At issue in this appeal was a district court’s order compelling production of a recording of petitioner Kayla Fox’s initial consultation with her attorney. The district court determined that the recording was not subject to the attorney-client privilege because her parents were present during the consultation and their presence was not required to make the consultation possible. Further, the district court refused to consider several new arguments Fox raised in a motion for reconsideration. The Colorado Supreme Court concluded the presence of a third party during an attorney-client communication ordinarily destroys the attorney-client privilege unless the third party’s presence was reasonably necessary to the consultation, unless another exception applies. On the facts of this case, the district court did not err when it found that Fox had not shown the requisite necessity to preserve her claim of privilege. Nor did the district court abuse its discretion in declining to consider Fox’s new arguments raised for the first time in her motion for reconsideration. View "In re Fox v. Alfini" on Justia Law

Shaf, a New Jersey company, sells apparel. Seventh Avenue, a Wisconsin-based catalog merchandiser, sells clothing protected by a trademark. After a dispute over Shaf’s alleged infringement of Seventh Avenue’s trademark, the parties entered into a consent agreement. Months later, Seventh Avenue discovered what it saw as continuing infringement by Shaf and moved to hold Shaf in contempt. Shaf was represented in the district court by Milwaukee counsel. The attorney received an email notification (from the court’s electronic docketing system) of the motion upon its January 17 filing, indicating that response was due January 24. Shaf failed to respond. The court scheduled a hearing for February 14. Nobody for Shaf appeared. The court held Shaf in contempt and required that it pay Seventh Avenue’s fees and costs. The contempt order prompted Shaf's local counsel to move for reconsideration, explaining that counsel was traveling internationally when the motion was filed. Counsel returned to work five days before Shaf’s written response was due and 26 days before the hearing, but took several weeks to catch up on his email. Shaf’s request also explained that local counsel believed national counsel would attend to any ongoing needs in the case. The court denied the motion to reconsider. Seventh Avenue supplemented its fee petition to reflect additional expenses. The Seventh Circuit affirmed an award of $34,905 in fees and costs. While the delayed response was better than no response, the court acted within its discretion to find that Shaf’s initial unresponsiveness warranted a sanction. View "Seventh Avenue, Inc. v. Shaf International, Inc." on Justia Law