Justia Legal Ethics Opinion Summaries

Nursing Personnel appealed the district court's partial judgment awarding plaintiff $185,962.12 in attorneys' fees under the attorneys' fees provision of the False Claims Act (FCA), 31 U.S.C. 3730(d)(1). Nursing Personnel filed the appeal to challenge time entries in plaintiff's fee petition. The court held that Nursing Personnel waived its challenge to the time entries by failing to raise this objection before the district court. Accordingly, the court affirmed and remanded for the limited purpose of awarding plaintiff appellate attorneys' fees. View "United States ex rel. Keshner v. Nursing Personnel Home Care" on Justia Law

In 2013 the Seventh Circuit held unconstitutional a provision of the Indiana Unclaimed Property Act, Ind. Code 32-34-1-1 that stated that “property” is “presumed abandoned if the owner or apparent owner has not communicated in writing with the holder concerning the property or has not otherwise given an indication of interest in the property” within a specified period varying according to the type of property. By filing a valid claim, the owner could reclaim the property up to 25 years after it was delivered to the attorney general, but was entitled only to principal and not to any interest. Several months later, the state amended the Act to provide for payment of interest. The district court dismissed the remand as moot and denied plaintiff attorneys’ fees. The Seventh Circuit reversed, opining that the judge was annoyed at the plaintiff because on remand she asked permission to file an amended complaint to convert the suit to a class action, based on intimations that the state would compensate only the plaintiff. She withdrew that request when the state amended the Act. The state’s concession did not deprive the plaintiff of her status as the prevailing party. The court also opined that the amount sought—$258,462.50 for 375.75 hours—is excessive. View "Cerajeski v. Zoeller" on Justia Law

Plaintiff Law Firm of Marc Grossman represented a student of defendant Victor Elementary School in a civil action arising from an assault that took place at the school. Plaintiff, in the name of the law firm, filed a petition for writ of mandate in the trial court under the Public Records Act seeking documentation reflecting the amount of money spent defending the litigation. That petition was denied, so relief was sought from the Court of Appeal, which granted the petition. Upon issuance of the remittitur, plaintiff filed a Memorandum of Costs seeking, among other costs, attorneys’ fees for the petition. The trial court granted defendant’s motion to tax costs, denying attorneys’ fees. Plaintiff appealed the denial of attorneys’ fees. On appeal, plaintiff argues the trial court erred in denying fees on the ground plaintiff represented itself in the trial court. Agreeing with plaintiff, the Court of Appeal reversed. View "Law Offices of Marc Grossman v. Victor Elementary School Dist." on Justia Law

Smith, a California partnership, hired attorney Moncrief to perform due diligence for its purchase of equipment from Texas Hill in Arizona. Texas Hill was represented by Clark, an Arizona attorney. Moncrief performed a UCC search, called Clark, and left a voicemail. Clark called Moncrief in response and represented that Texas Hill was the sole owner of the equipment. Afterwards Clark sent Moncrief an e-mail, stating: “I have been the attorney for Texas Hill . . . and can state unequivocally that the cooling equipment you are buying is free and clear and is owned by Texas Hill.” Based on Clark’s representations, Moncrief advised Smith to go forward with the purchase. Smith later learned that Texas Hill did not own the equipment when they completed the transaction; New York Community Bank had acquired an interest in the equipment. Smith sued Moncrief for legal malpractice. Moncrief cross-complained against Clark. Clark moved to quash service, arguing that California lacked personal jurisdiction over him. The court granted the motion. Clark’s conduct and his intentional misrepresentations were required to close the sale. Clark personally availed himself of the benefits of California when he reached into California to induce Moncrief’s client to complete the purchase. Moncrief’s claims arise out of Clark’s contacts with California. lark has not demonstrated that exercise of jurisdiction would be unreasonable. View "Moncrief v. Clark" on Justia Law

Aeolus and Debtors owed plaintiffs over five million dollars pursuant to an arbitrator's ruling. Before plaintiffs obtained a judgment confirming the arbitration award, Aeolus entered into a security agreement with Zhejiang and Zhejiang filed a blanket lien attaching to all of Aeolus's assets. After plaintiffs obtained the judgment, Debtors filed for bankruptcy. Plaintiffs hired Keehn as counsel in order to obtain discovery and challenge Zhejiang's lien as a fraudulent transfer. Plaintiffs subsequently substituted Landsberg for Keehn as bankruptcy counsel. Plaintiffs discovered that Keehn missed the deadline to investigate and attack the lien. Plaintiffs ultimately accepted an amount for $1.6 million less than the arbitration award. Plaintiffs then filed suit against Keehn and Landsberg for malpractice. The trial court granted summary judgment for each defendant. The court concluded that the trial court correctly decided that plaintiffs' malpractice claim was not tolled until the completion of the mediation and that the one-year statute of limitations had expired by the time plaintiffs filed their suit. Accordingly, the court affirmed the judgment. View "Shaoxing City v. Keehn & Assoc." on Justia Law

Sanctionees Hancock, Musnuff, and Goodyear appealed from the district court's award of sanctions, arguing that the district court abused its discretion in relying upon its inherent power to impose sanctions, and in determining the amount and the nature of the sanctions imposed. The court concluded that Sanctionees’ argument that the district court should have relied on Federal Rule of Civil Produce 37 fails because the district court's inherent power is not limited by overlapping statutes or rules. The court held that it was not an abuse of discretion for the district court to rely on its inherent power to sanction the conduct at issue in this case, and to determine that Rule 37 did not provide the appropriate remedy, especially since the discovery fraud was not discovered until after the case had settled. In this case, it is clear the district court did not abuse its discretion in concluding that Hancock, Musnuff, and Goodyear acted in bad faith in this litigation; the district court acted well within its discretion in awarding all the attorneys’ fees and costs incurred by plaintiffs after Goodyear served its supplemental responses to plaintiffs’ First Request; and the court affirmed the monetary and non-monetary sanctions set forth in the district court’s Order. View "Haeger v. Goodyear Tire & Rubber Co." on Justia Law

Taylor’s brother died in an accident. Caiarelli, the decedent’s ex-spouse and guardian of their minor child, obtained a state court declaration that the child was entitled to assets distributed to Taylor ($1.4 million). The estate assigned the judgment to Caiarelli. Taylor sought a probate court declaration that the assignment was void. Before resolution, Taylor filed for Chapter 11 bankruptcy, triggering the automatic stay. Caiarelli initiated an adversary proceeding, objecting to discharge of the judgment. The bankruptcy court dismissed, finding that Caiarelli failed to establish standing. The judgment was discharged, and Taylor’s creditors enjoined from collecting, 11 U.S.C. 524(a)(2). Caiarelli returned to probate court, which ratified the assignment. Taylor claimed that Caiarelli and her attorneys violated the discharge and plan injunctions. The bankruptcy court entered a civil contempt order and issued a damages order and judgment for $165,662.36 in attorney’s fees. While appeal was pending, Taylor notified the district court that he reached a settlement with the legal malpractice insurance carrier for Caarelli’s attorneys. The attorneys denied that a full settlement had been reached. The bankruptcy court indcated that vacatur would be approved if the parties returned to the court, so the district court denied Taylor’s motion to dismiss but reversed the contempt order, damages order, and judgment, finding no violation of the statutory discharge or plan injunctions. The Seventh Circuit affirmed, finding that the appeal was not moot. View "Taylor v. Caiarelli" on Justia Law

When Bloodman withdrew as Haynes’s attorney in a criminal case, the judge ordered her to return discovery material “as soon as possible” and emailed the order, instructing her “to turn over to the United States Attorney’s Office any and all discovery material previously provided her by the Government.” After 20 days, she had not returned the material. The judge issued an order to return it within a week, or risk a show-cause order and sanctions. Bloodman, no longer on the electronic filing system, did not receive the email; the clerk mailed her a hard copy. She still had not returned the material 11 days later. The judge emailed her a show-cause order. Bloodman sent the material the next day via overnight mail, though delivery was delayed due to weather. At the show-cause hearing, Bloodman apologized. She claimed not to receive the second order, the only one to set an exact date and to have had medical issues. The judge did not find bad faith or hold her in contempt, but ordered her to pay $250 for the government’s “time and effort and energy.” The Eighth Circuit dismissed an appeal for lack of jurisdiction because Haynes’s criminal case is still pending. View "United States v. Bloodman" on Justia Law

In the underlying case, certain parties moved for sanctions against Attorney on the grounds that he had violated the rules of professional conduct and interfered with the effective administration of justice. The judge ordered Attorney to reimburse all parties their attorney’s fees as a sanction for his misconduct. The judge assessed attorney’s fees against Attorney without the authority of any statute or rule, in the absence of any violation of a court order or rule of procedure, and in the absence of any contractual arrangement among the parties authorizing the assessment of attorney’s fees. The Supreme Judicial Court reversed the judge’s order imposing sanctions, holding (1) a judge may exercise the court’s inherent power to sanction an attorney by imposing attorney’s fees only if the attorney has engaged in misconduct that threatens the fair administration of justice and the sanction is necessary to preserve the judge’s authority to administer justice; and (2) under the circumstances of this case, the judge abused his discretion in exercising the court’s inherent powers to sanction Attorney. View "Wong v. Luu" on Justia Law

Georgia citizen George Skipper was involved in a motor vehicle accident with a logging truck that was driven by Harold Moors and owned by Specialty Logging, LLC. Specialty had a commercial automobile insurance policy with a $1,000,000 per occurrence limit, which was issued by ACE Property and Casualty Insurance Company (ACE). Following the accident, Skipper retained an attorney who wrote a demand letter to ACE offering to settle the case for the limits of the Policy. ACE retained two lawyers from Atlanta, Brantley Rowlen and Erin Coia, to represent Specialty and Moors. Specialty and Moors offered Skipper $50,000. Not satisfied with that offer, Skipper and his wife filed a lawsuit in the Allendale County Court of Common Pleas against Specialty and Moors. Unbeknownst to ACE or its attorneys, the Skippers entered into a settlement with Specialty and Moors, agreeing to execute a Confession of Judgment for $4,500,000, in which they admitted liability for the Skippers' injuries and losses. The Specialty Parties also agreed to pursue a legal malpractice claim against ACE and its attorneys Rowlen and Coia, and assigned the predominant interest in that claim to the Skippers.1 In exchange for the Specialty Parties' admission of liability, the Skippers agreed not to execute the judgment as long as the Specialty Parties cooperated in the legal malpractice litigation against Defendants. Armed with the assignment, the Skippers and Specialty Parties filed a legal malpractice action against the attorneys, also with the Allendale County court. The case was removed to the United States District Court for the District of South Carolina. In federal court, ACE and its attorneys argued that the assignment of the malpractice claim was invalid and that the Skippers had no valid claims to assert. Because the question of whether a legal malpractice claim could be assigned between adversaries in litigation in which the alleged malpractice arose was a novel question in South Carolina, the South Carolina Supreme Court accepted a certified question South Carolina law from the federal district court. After review, the South Carolina Court held that in South Carolina, the assignment of a legal malpractice claim between adversaries in litigation in which the alleged malpractice arose was prohibited. View "Skipper v. ACE Property" on Justia Law