Justia Legal Ethics Opinion Summaries

In consolidated appeals, the court ruled on motions to seal settlement agreements. In Goesel, the law firm filed a motion to maintain under seal documents disclosing the amounts of a personal injury settlement and of the lawyers' costs and fees. In Massuda, defendants sought to keep the redacted settlement agreement, in a suit for breach of fiduciary duty, kept under seal. The court concluded that the parties in both cases have failed to rebut the presumption of public access to judicial records. In neither case have they offered any reason for secrecy except that they have a confidentiality agreement and that was insufficient. The court denied the request in Goesel where an outsider to the litigation could not evaluate the dispute over the district judge's modification of the settlement without knowing the amount of the settlement before and after the modification. The court dismissed the request in Massuda where, inter alia, there was no indication that the amount of the settlement figured in the district court's decision. View "Goesel, et al. v. Boley Int'l, et al." on Justia Law

Plaintiffs filed a class action suit against B&B and others, alleging violations of the Racketeer Influenced and Corrupt Organizations Act (RICO), 18 U.S.C. 1962. The alleged scheme involved "Population Equivalents" (PEs), specified quantities of sewage that a house or other building was estimated to dump into the local sewage system. The complaint alleged that B&B had improperly taken control of the Wasco Sanitary District and used that control to divert to itself permit fees that should have gone to the district to finance an expansion of its sewage system. The district court dismissed the claim for want of RICO standing because plaintiffs could not demonstrate an injury to their business or property. On appeal, defendants challenged the district court's denial of their application for an award of attorneys' fees under Fed. R. Civ. P. 11(b)(1) and (2). The court concluded that plaintiffs' suit, while meritless, was not frivolous. Accordingly, the court affirmed the judgment of the district court. View "Fiala, et al. v. B&B Enterprises, et al." on Justia Law

Kalitta filed suit against numerous defendants, including CTAS, alleging various causes of action stemming from the modification of two of its aircraft from passenger to cargo planes. In this appeal, Kalitta challenged the district court's award of costs to CTAS following a jury's unanimous verdict in favor of CTAS. The court reversed the district court's award of costs for the pro hac vice admission of CTAS's counsel; reversed the district court's award of costs for editing and synchronizing deposition videotapes; and affirmed the court's award of costs for graphics consultants and the 2002 costs award. View "Kalitta Air L.L.C. v. Cent. Texas Airborne Sys." on Justia Law

Dr. Hinchee, who resides in Florida, and Chevron appeal the district court's discovery order compelling production of Dr. Hinchee's documents to the Republic of Ecuador. Dr. Hinchee served as a testifying expert for Chevron in a related proceeding. The discovery dispute at issue stemmed from a suit brought by Ecuadorian plaintiffs alleging that Texaco's oil exploration in the Amazonian rain forest polluted private and public lands in Ecuador and that Texaco was responsible for plaintiffs' oil-related health problems and the environmental contamination of plaintiffs' property. The court concluded that Dr. Hinchee's notes and email communications with non-attorneys, including other experts, were relevant within the meaning of Federal Rule of Civil Procedure 26(b)(1), and the Republic was thus entitled to discover these materials. Neither the text of Rule 26(b)(3)(A) nor its structure, history, and rationale support extending the work-product doctrine to all testifying expert materials. To the extent any attorney core opinion work-product was embedded in the 1,200 documents at issue here, Chevron and Dr. Hinchee could appropriately redact such portions. Accordingly, the court affirmed the district court's order compelling discovery. View "Republic of Ecuador v. Hinchee, et al." on Justia Law

McKenzie’s creditors filed an involuntary Chapter 7 bankruptcy petition in 2008. McKenzie filed a voluntary Chapter 11 petition a month later. The cases were consolidated and converted to a Chapter 7 bankruptcy. Several weeks before the involuntary petition was filed, McKenzie executed a promissory note and a pledge in favor of GKH for unpaid legal fees. The pledge listed several entities in which McKenzie held an interest, ranging from an “auto mall” to a farm. GKH filed a proof of claim for $750,000, describing the collateral as “Real Estate” and “Other” and sought relief from the automatic stay. The Trustee opposed relief on the ground that the pledge constituted a preferential transfer. The bankruptcy court granted relief with respect to certain real estate, but denied relief as to equity interests. The bankruptcy court held that McKenzie had not validly conveyed his equity interests in certain entities to GKH, that the Trustee could use his hypothetical lien-creditor status and avoidance powers defensively to defeat GKH’s security interest, and that the statute of limitations should be equitably tolled because of GKH’s conduct. The district court affirmed. The Sixth Circuit affirmed, holding that GKH had the burden of establishing the validity of its claimed security interest and that a trustee may use his hypothetical lien-creditor status and avoidance powers to oppose relief from the automatic stay after expiration of the statutory limitation on avoidance actions under 11 U.S.C. 546(a)(1)(A).View "In re: Grant, Konvalinka & Harrison v. Still" on Justia Law

The bankruptcy court ordered debtor's counsel to return all consideration he received, but in so doing it imposed an additional sanction beyond return of compensation. A bankruptcy judge may regulate attorney compensation by ordering debtor's counsel to return to the estate excessive compensation, 11 U.S.C. 329(b). Separately, a bankruptcy judge has authority to discipline attorneys who violate the disclosure requirements of the Bankruptcy Code and Rules. In this case, the court reversed and remanded the bankruptcy court's order because a bankruptcy judge's reach under the plain language of section 329(b) was limited to attorney compensation. View "Baker v. Cage" on Justia Law

When Plaintiff retained a Maine law firm to represent him in a legal action, he signed an attorney-client engagement letter that contained an arbitration provision. Plaintiff later sued the law firm and individual defendants (collectively, Defendants) for malpractice and violations of Maine's Unfair Trade Practices Act. Defendants moved to compel arbitration and dismiss the action. The district court granted the motion under the Federal Arbitration Act (FAA). Plaintiff appealed, arguing that the district court erred in enforcing the arbitration clause. The First Circuit Court of Appeals affirmed, holding that the district court did not err in granting the motion to compel arbitration and dismissed the action, as (1) Maine professional responsibility law for attorneys permits arbitration of legal malpractice claims so long as there is no prospective limitation on the law firm's liability; and (2) Maine law, like the FAA, is not hostile to the use of the arbitration forum, and Maine would enforce the arbitration of malpractice claims provision in this case. View "Bezio v. Draeger" on Justia Law

Sneed is the surviving spouse of Reginald, who served on active duty 1964-1968 and suffered service-connected disabilities, including post-traumatic stress syndrome, post-concussion syndrome, degeneration of the vertebrae, narrowing of the spinal column, tinnitus, a perforated tympanic membrane, and scarring of the upper extremities. In 2001, Reginald fell and suffered a spinal cord contusion, rendering him a quadriplegic. In 2003, he was living in a nursing home for paralyzed veterans. There was a fire and all of the residents died of smoke inhalation. Sneed sought dependency and indemnity compensation, 38 U.S.C. 1310, alleging that her husband’s service-connected disabilities were a cause of his death. The VA denied the claim. The Board affirmed. Sneed’s notice of appeal was due by August 3, 2011. Sneed retained attorney Eagle, communicated with Eagle’s office “for a year or longer” and stated that “Eagle knew that there was a deadline.” On August 2, 2011 Sneed received a letter stating that Eagle would not represent Sneed in her appeal. Failing to find new counsel, Sneed filed notice of appeal on September 1, 2011, with a letter explaining her late filing. The Veterans Court dismissed the appeal as untimely. The Federal Circuit vacated, holding that attorney abandonment can justify equitably tolling the deadline for filing an appeal. View "Sneed v. Shinseki" on Justia Law

Wells Fargo sued the Younans for breach of contract. The defendants moved for dismissal for lack of subject matter jurisdiction, lack of personal jurisdiction over Sherry Younan because of lack of minimum contacts in Illinois and insufficient service of process. The district court ruled that the opposing parties were not of diverse citizenship and that it lacked subject matter jurisdiction. Instead of amending, Wells Fargo moved, nine months after filing its original complaint, to be allowed to dismiss without prejudice. The defendants asked that dismissal be conditioned on Wells Fargo’s paying their legal expenses of $56,000. The judge dismissed, conditioned on Wells Fargo reimbursing defendants for $11,000 in legal expenses incurred in seeking dismissal. The Seventh Circuit affirmed, noting that the defendants did not justify their “extravagant‐seeming request, which included more than $9,000 for two briefs each of which was just half a page long and merely incorporated by reference another lawyer’s brief.” View "Wells Fargo Bank, NA v. Younan Props., Inc." on Justia Law

UPS appealed the district court's award of attorney fees to plaintiff. At issue was whether the district court abused its discretion in awarding plaintiff $697,971.80 where the jury awarded her only $27,280 after finding that UPS had discriminated against her on the basis of her gender. The court affirmed in part and vacated in part, remanding to the district court to reconsider an award of fees for paralegal work on behalf of plaintiff and to determine, in the first instance, whether any hearsay exception applied to the paralegal's declaration regarding fees for paralegal work in this case, and to determine an award to plaintiff for reasonable attorney fees and costs incurred in defending this appeal. View "Muniz v. UPS" on Justia Law