Justia Legal Ethics Opinion Summaries

At trial, when Abbas Husain was sworn in, he raised his right hand and spoke the oath, but did not place his left hand directly on the Bible. Ultimately, the jury returned a verdict in favor of Tomika Davis for $12,500. After the verdict was rendered and the jury was discharged, but before post-trial motions were argued and the judgment was entered, the trial judge had a conversation with the jurors, outside the presence of counsel, which was not recorded. During that discussion, one juror noted that she was surprised that Husain had not placed his hand on the Bible before he testified. The judge did not make a record of the juror's observation, but later informed counsel. Both parties subsequently filed post-trial motions. A certification by Husain, filed in support of his post-trial motion, included a brief reference to the juror's observation. At oral argument on the motion, the trial judge expressed surprise that information he had provided counsel in confidence ended up in a certification and as part of the trial record. Ultimately, the court denied Husain's motion, finding the amount allocated in the verdict fair in light of the evidence and giving no regard to the comment the juror made in reference to the fact that Husain did not touch the Bible. After the judgment was entered, Husain appealed, raising several arguments. Relevant to the limited issue presented in this appeal as of right, he argued that the trial judge erred by failing to declare a mistrial on the basis of the juror's comment about the fact that he did not touch the Bible. In an unpublished decision, a majority of the Appellate Division panel affirmed the verdict as to this issue, holding that no manifest injustice inhered in the juror's observation and comment. The dissenting judge maintained that the trial judge had violated the Code of Judicial Conduct and that the juror's observation was sufficient to warrant a new trial. Husain appealed to the Supreme Court as of right. The Supreme Court reversed and remanded: post-verdict discussions between the court and discharged jurors are prohibited unless those discussions are part of a hearing ordered on good cause shown. View "Davis v. Husain" on Justia Law

Bell sued attorney Ruben and his firm, alleging that they negligently and fraudulently mismanaged her trust, causing a loss of $34 million. Before arbitration, Ruben filed for Chapter 7 bankruptcy. Bell filed an adversary complaint opposing discharge of Ruben’s fraud-based debt to her, 11 U.S.C. 523(a)(2)(A), (4). The bankruptcy judge granted Ruben a discharge of his other debts, but not of that fraud debt. Ruben’s liability insurance did not cover fraud. Bell settled her negligence claims against Ruben and all claims against the other defendants in arbitration. The arbitration panel ruled, with respect to the fraud claim, that “damages proven to be attributable to the actions of [Ruben] have been compensated,” but ordered Ruben to pay administrative fees and expenses of the American Arbitration Association (AAA) totaling $21,200.00 and that compensation and expenses of the arbitrators, advanced by Bell, totaling $150,304.54 would be borne by Ruben. AAA rules, which governed the arbitration, provide that expenses of arbitration “shall be borne equally” unless the parties agree otherwise or the arbitrator assesses expenses against specified parties. Ruben refused to pay. The bankruptcy judge entered summary judgment in favor of Ruben. The district court reversed, in favor of Bell. The Seventh Circuit affirmed. View "Ruben v. Bell" on Justia Law

The Division of Motor Vehicles (DMV) charged Twin County Motorsports, Inc. with violating N.C. Gen. * Stat. 20-183.7B(a)(3) for allowing a person not licensed as a safety inspection mechanic to perform safety inspections. Lance Cherry, an officer and shareholder of Twin County, requested a hearing before the DMV and appeared at the hearing on behalf of Twin County. After concluding that sufficient evidence sustained the finding that Twin County violated section 20-183.7B(a)(3), the hearing officer levied a civil penalty and suspended Twin County’s inspection license. The Commissioner of the DMV upheld the hearing officer’s order. Twin County appealed, arguing that Twin County, as a corporation, should not have been represented by Cherry, a nonattorney, at the DMV hearing. The trial court agreed and remanded the matter for a new hearing. The Supreme Court reversed, holding that a nonattorney’s appearance on behalf of a corporate entity before an administrative hearing officer does not constitute the unauthorized practice of law, and therefore, the trial court erred in reversing the DMV’s final agency decision in this case. View "In re Twin County Motorsports, Inc." on Justia Law

Plaintiffs participated in the Occupy Wall Street protests in front of Austin City Hall. The City then started a policy under which it issued criminal-trespass notices to plaintiffs and other protestors. Plaintiffs filed suit against the City, alleging facial and as-appliec challenges to the policy under the First and Fourteenth Amendments, seeking declaratory and injunctive relief and damages. After bench trial, the district court entered an order declaring the policy unconstitutional on its face and enjoined the City from issuing the notices. The district court denied plaintiffs' motion for attorneys fees and expenses under 42 U.S.C. 1988 and plaintiffs appealed. The court reversed the denial of fees because plaintiffs were the prevailing party on their constitutional challenge. The district court abused its discretion when it relied on limited injury and limited success as special circumstances justifying a wholesale denial of fees. Even accepting the district court's consideration of the limited injury and limited scope of the injunction as special circumstances, the district court's factual support for those points is unsupported by record evidence. The court remanded for the district court to determine the amount of the award. View "Sanchez v. City of Austin" on Justia Law

Danko practiced law with the firm of O’Reilly & Collins, until, in 2009, Danko sued O’Reilly, as an individual, and O’Reilly & Collins, for unpaid wages. Before trial, O’Reilly, as an individual, obtained directed verdict. In 2012, judgment was entered in favor of Danko for more than $2,000,000. Danko filed moved to amend the judgment and the costs and fee order “to include Terry O’Reilly as a judgment debtor for all amounts owed to Michael Danko” on the ground that O’Reilly knew that the firm owed Danko more than $2 million, but drew out all the firm’s available funds without reserving any amounts to satisfy the debt he knew was owed to Danko, telling Danko “you will not be able to execute on any judgment.” The court of appeal affirmed the trial court’s amendment of the judgment, citing Code Civ. Proc., 187. The court rejected arguments that the amendment was entered in violation of a stay in the bankruptcy of the firm; the amendment was precluded by the doctrine of res judicata; and the amendment was contrary to the principles governing collateral estoppel. View "Danko v. O'Reilly" on Justia Law

Flannery and Murray sued Southern California Gas Company (SCGC) for damages suffered in the 2008 Sesnon wildfire.They were jointly represented by Tepper until attorney Ardi substituted in as Murray’s counsel. Tepper represented Flannery until 2012, when attorney Daneshrad substituted in as Flannery’s counsel. Tepper filed a notice of lien. In 2013, a settlement b was approved by the court, requiring SCGC to pay confidential specific amounts to Flannery and Murray and their attorneys before March 19, 2013. Tepper sent an e-mail advising all that he was “entitled to know the amount” and asserting a 33 1/3% lien. Unable to obtain agreement from Tepper and Daneshrad, SCGC filed the Interpleader Action, identifying Tepper, Daneshrad, and Flannery as defendants, and deposited the settlement funds with the court. Once the deadline for SCGC to pay had expired, Flannery moved to enforce the settlement. SCGC moved for discharge from the interpleader action and attorney fees. Flannery filed a special motion to strike under Code of Civil Procedure 425.16 (Anti-SLAPP). The court granted the discharge and denied the Anti-SLAPP Motion. The court of appeal affirmed. SCGC met its burden of showing a probability it would prevail on the merits of its interpleader action. View "S. Cal. Gas Co. v. Flannery" on Justia Law

Cobra was a prequalified vendor of information technology goods and services to the city. In 1999-2000, Cobra submitted invoices based on invoices submitted by its subcontractor, Monarch. Monarch had not performed the work, but was a sham corporation run by Armstrong, then-manager of information technology for a city agency. The city paid the invoices. After uncovering another scheme involving Armstrong and a different vendor, the city received complaints that Cobra had not paid subcontractors for work for which the city had paid Cobra. Cobra did not submit to an audit request. The City Attorney had represented Cobra on matters including city contracts while in private practice. Although he had personally been screened from matters related to Cobra, the court ordered the city to retain independent counsel, but stayed proceedings pending appeal. The California Supreme Court affirmed the disqualification. A jury returned verdicts against Cobra and rejected all counterclaims. The court of appeal held that Cobra waived appeal of its motion to preclude the city from using evidence procured with the participation of the City Attorney; reversed as to intentional misrepresentation, negligent misrepresentation, and violation of the false claims acts; and remanded for a new trial limited to those claims. View "City & Cnty, of San Francisco v. Cobra Solutions, Inc." on Justia Law

P&C filed suit on behalf of Penn, LLC against Prosper Corporation, Prosper’s owners, and their counsel, the Arnold Firm, alleging violations of the Racketeering Influenced and Corrupt Organizations Act, fraud, conversion, unjust enrichment, and breach of fiduciary duty in connection with the management of Penn and Prosper’s joint venture, BIGresearch. There had been court and arbitration proceedings since 2004, but Penn never before named the Arnold Firm as a defendant. The Arnold Firm served P&C with a letter purporting to satisfy the obligations of Fed. R. Civ. P. 11, threatening to seek sanctions if the matter was not dismissed, and claiming that the action was frivolous and had been filed for the “improper and abusive purpose” of disrupting the Arnold Firm’s attorney-client relationship with Prosper and its owners. The district court ultimately dismissed the Arnold Firm from the action, but denied a motion for Rule 11 sanctions against P&C. The Sixth Circuit affirmed on the alternative ground that the Arnold Firm’s failure to comply with Rule 11’s safe-harbor provision made sanctions unavailable. The Arnold Firm’s warning letter expressly reserved the firm’s right to assert additional grounds for sanctions in its actual motion. View "Penn, LLC v. Prosper Bus. Dev. Corp." on Justia Law

After prevailing in a condemnation action, petitioners-landowners moved for an award of attorneys' fees pursuant to section 28-2-510(B)(1) of the Eminent Domain Procedure Act. Contrary to petitioners' view, the circuit court determined attorneys' fees should be awarded based on an hourly rate via a lodestar calculation rather than the contingency fee agreement between Petitioners and their attorney. The Court of Appeals affirmed. The Supreme Court interpreted section 28-2-510 and concluded the General Assembly intended for attorneys' fees to be awarded based on a constellation of factors. Specifically, section 28-2-510(B)(1) mandated that in order for a prevailing landowner to recover reasonable attorneys' fees he or she must submit an application for fees "necessarily incurred." Therefore, by implication, the General Assembly precluded a landowner from recovering attorneys' fees based solely on a contingency fee agreement without regards for section 28-2-510. The Court explained that even though the contingency fee agreement is not the sole element in the calculation, it is still a significant component as it may be used to explain the basis for the fee charged by the landowner's counsel. "Our decision should not be construed as somehow condemning or eliminating an attorney's use of a contingency fee agreement. To the contrary, we recognize that the use of these agreements is a legitimate and well-established practice for attorneys throughout our state. This practice may still be pursued. Yet, it is with the caveat that the terms of the agreement are not controlling. Rather, they constitute one factor in a constellation of factors for the court's consideration in determining an award of reasonable litigation expenses to a prevailing landowner under section 28-2-510(B)(1). The court may, in fact, conclude that the contingency fee agreement yields a reasonable fee. However, the court is not bound by the terms of the agreement. " For this case, the Supreme Court held that the Court of Appeals misapplied case law precedent. Furthermore, the Court concluded the circuit court failed to conduct the correct statutory analysis, and remanded this matter to the circuit court. Petitioners' counsel was instructed to submit an itemized statement in compliance with section 28-2-510(B)(1) as counsel's original affidavit failed to identify the "fee charged" and the actual number of hours expended. View "South Carolina Dept. of Trans. v. Revels" on Justia Law

This matter comes before the Louisiana Supreme Court on the recommendation of the Judiciary Commission that respondent, Judge J. Robin Free of the 18 Judicial District Court, Parishes of West Baton Rouge, Iberville, and Pointe Coupee, be suspended without pay for thirty days and be ordered to reimburse and pay to the Commission $6,723.64 in hard costs. In Count 1, the complaint alleged Judge Free engaged in improper ex parte communications with counsel for a party in an environmental contamination class action lawsuit, and improperly handled a request to recuse himself from the case due to his mother’s status as a class member. In Count 2, the complaint alleged that in 2010, Judge Free accepted an invitation to participate in an all-expenses-paid trip on a private jet to a hunting ranch in Texas, extended to him by attorneys in a personal injury case before him at or near the time of settlement negotiations, including an attorney who regularly tries cases in his court, and which trip occurred shortly after the trial was concluded. The Commission received an anonymous complaint concerning this trip in August 2010. The Commission conducted an investigatory hearing, made findings of fact and conclusions of law and determined that Judge Free violated Canons 1, 2, 2A, 3A(4), 3A(6), and 6B(2) of the Code of Judicial Conduct and Article V, Section 25(C) of the Louisiana Constitution. After reviewing the record, the Supreme Court found all of the charges against Judge Free, except his failure to recuse in Count I, were proven by clear and convincing evidence and the Court accepted the recommendation of discipline of the Commission. View "In re Judge Robin Free" on Justia Law