Justia Legal Ethics Opinion Summaries

Amicas agreed to a merger for $5.35 per Amicas share. Shareholders sued in Massachusetts state court, contesting the adequacy of a proxy statement used to seek approval. A preliminary injunction stopped the vote. The suit settled when a third party made a $6.05 per-share tender offer. Amicas shareholders gained $26 million. The lawyers who filed the suit sought attorneys’ fees based on the difference between the bids. Carolina Casualty had issued a policy covering what Amicas and its directors pay their own litigation lawyers and what Amicas must pay adversaries’ lawyers. The state court awarded $3,150,000, using a lodestar of $630,000 (1,400 hours at $450 per hour) times five, to reflect the risk of nonpayment and “an exceptionally favorable result.” Carolina Casualty filed a diversity suit, claiming that coverage was limited to $630,000. The district judge affirmed, but denied damages for bad faith or vexatious failure to pay. The Massachusetts appeal settled with payment of a sum that cannot be affected by the results of federal litigation. The Seventh Circuit held that the case was not moot, but affirmed, rejecting an argument that the award constituted excluded “civil or criminal fines or penalties … punitive or exemplary damages, the multiplied portion of multiplied damages.” View "Carolina Cas. Ins. Co v. Merge Healthcare Solutions, Inc." on Justia Law

Defendant, the founder and former CEO of HealthSouth, was found guilty of federal funds bribery, honest services fraud, and conspiracy to commit the latter offenses. Defendant subsequently appealed the district court's denial of his motion for a new trial filed while Siegelman I was before the Supreme Court on certiorari, and the denial of his motion to recuse the trial judge. The court concluded that there was no abuse of discretion in Judge Henkle's denial of the motion to recuse under 28 U.S.C. 455(b) where the judge's ex parte meeting with the Marshals regarding a disputed factual issue did not lead an objective disinterested lay observer to entertain significant doubt about the judge's impartiality and the judge did not have personal knowledge of disputed evidentiary facts concerning the proceeding, nor was he likely to be a material witness. Addressing five of the six grounds defendant relied on in seeking a new trial, the court also concluded that there was no abuse of discretion in Judge Fuller's handling of the motion for new trial under Federal Rule of Criminal Procedure 33(b)(1). Accordingly, the court affirmed the judgment of the district court. View "United States v. Scrushy" on Justia Law

Plaintiffs, Minnesota homeowners represented by the same counsel, brought thirteen separate claims against defendants, nearly all of which rested on a "show me the note" theory. The district court granted defendants' motion to dismiss nearly all of the claims and sua sponte sanctioned counsel, awarding attorney fees to defendants. The court affirmed, concluding that the district court had diversity jurisdiction as the claims against the sole nondiverse defendant lacked a reasonable basis in fact and law; plaintiffs failed to state a plausible claim for relief sufficient to survive a motion to dismiss; the "show me the note" theory had been repeatedly rejected by the Minnesota Supreme Court and this court applying Minnesota law; and the district court did not abuse its discretion in imposing sanctions against counsel under Rule 11 where, at the very least, counsel had lacked a frivolous basis for appeal. View "Welk, et al. v. Ally Financial,Inc., et al." on Justia Law

Appellant St. Simon's Waterfront, LLC ("SSW") sued its former law firm, Appellee Hunter, Maclean, Exley & Dunn, P.C. ("Hunter Maclean"), over the firm's representation in a commercial real estate venture. During the litigation, SSW sought production of communications between Hunter Maclean attorneys and the firm's in-house general counsel, which took place during the firm's ongoing representation of SSW, in anticipation of potential malpractice claims by SSW. Hunter Maclean asserted that the materials were protected from disclosure by the attorney-client privilege and work product doctrine, but the trial court disagreed and ordered their production. On appeal, the Court of Appeals vacated the trial court's order and remanded for further consideration. Upon review, the Supreme Court held that the same basic analysis that is conducted to assess privilege and work product in every other variation of the attorney-client relationship should also be applied to the law firm in-house counsel situation. The Court vacated the judgment of the Court of Appeals. View "St. Simons Waterfront, LLC v. Hunter, Maclean, Exely & Dunn, P.C." on Justia Law

Plaintiff retained Law Firm and its attorneys (collectively, Law Firm) to accomplish Plaintiff's foreclosure on a mortgage to certain property. A year after the foreclosure sale, while Law Firm was representing Plaintiff in negotiations for the sale of the foreclosed property, another law firm retained by Plaintiff sent a notice of claim to Law Firm alleging that Law Firm breached its obligations to Plaintiff by failing to inform Plaintiff of outstanding liens on the foreclosed property. After Law Firm concluded its representation of Plaintiff, Plaintiff filed an action against Law Firm, alleging, inter alia, legal malpractice and negligent misrepresentation. Law Firm moved for a protective order to preserve, among other things, the confidentiality of allegedly privileged communications to Law Firm's in-house counsel regarding Law Firm's reply to the notice of claim. The judge allowed the motion. The Supreme Court affirmed, holding that the judge correctly allowed Law Firm to invoke the attorney-client privilege to preserve the confidentiality of the communications. View "RFF Family P'ship v. Burns & Levinson, LLP" on Justia Law

This case stemmed from the detention and handcuffing of a nine-year-old student during her physical education class. Defendant, a Deputy Sheriff, appealed from the district court's grant of attorney's fees. The court concluded that the district court abused its discretion by awarding attorney's fees to plaintiff where plaintiff achieved a de minimus victory under the Farrar v. Hobby factors. Accordingly, the court reversed and remanded for entry of judgment in favor of defendant on his claim for attorney's fees. View "Gray v. Bostic" on Justia Law

Cherokee Metropolitan District intervened in a lawsuit to try to minimize the loss of its water rights to some of its wells. In a separate legal malpractice action, Cherokee sued its former attorneys James Felt and James Culichia, and their firm Felt, Monson & Culichia, LLC (collectively "FMC"), alleging that FMC's negligence led to the eventual loss of those water rights. FMC sought to intervene in the water rights action, arguing that intervention was necessary in order to minimize damages it may have suffered in the legal malpractice case. The water court denied FMC's motion to intervene. FMC appealed. The Supreme Court found that despite taking opposite sides in the malpractice action, Cherokee and FMC shared an identical interest in the underlying water rights litigation. Because FMC did not made a compelling showing that Cherokee could not adequately represent the interest that it shared with Cherokee, the Court affirmed the water court's denial of FMC's motion to intervene as of right. Similarly, the Court dismissed FMC's appeal of the water court's denial of FMC's motion for permissive intervention because the water court did not abuse its discretion. View "Cherokee Metro. Dist. v. Felt, Monson & Culichia LLC" on Justia Law

This case stemmed from disputes over the estate of the late Texas oil magnate and billionaire J. Howard Marshall. J. Howard died in 1995, leaving nearly all his assets to his son, Pierce, but excluding his wife, Anna Nicole Smith (Vickie), and his other son, Howard, from receiving any part of his fortune. Howard and his Wife eventually filed for Chapter 11 bankruptcy and their case was assigned to Judge Bufford, who had previously presided over Vickie's Chapter 11 bankruptcy case. Judge Bufford published three separate opinions: (1) denying Pierce's motion for reassignment or recusal; (2) confirming the Plan and denying Pierce's motion to dismiss with respect to his constitutional arguments; and (3) confirming the Plan and denying Pierce's motion to dismiss with respect to his statutory arguments. Elaine, Pierce's widow, now appeals the district court's decision, contending that the district court erred in affirming the bankruptcy court's orders. The court addressed the various issues on appeal related to the motion for recusal or reassignment, constitutional issues, and non-constitutional issues, and ultimately affirmed the district court's decision. View "In the Matter of: Marshall" on Justia Law

Plaintiff, an ALJ, brought this action alleging that HUD had interfered with his decisional independence and thereby violated the Administrative Procedure Act, 5 U.S.C. 500 et seq. The court concluded that it need not decide whether the district court correctly dismissed plaintiff's claims for lack of standing where the Civil Service Reform Act of 1978, Pub. L. No. 95-454, 92 Stat. 1111, deprived the district court of subject matter jurisdiction over the complaint. View "Mahoney v. Donovan, et al." on Justia Law

Bistline pled guilty to knowingly possessing 305 images and 56 videos of child pornography on his computer, many of which depicted 8- to 10-year-old girls being raped by adult men. His recommended Guidelines sentence was 63 to 78 months’ imprisonment. The district court sentenced Bistline to a single night’s confinement in lockup, plus 10 years’ supervised release. The Sixth Circuit vacated, noting that Bistline’s guidelines range should have been “the starting point” for considering the factors in 18 U.S.C. 3553(a) and that the court was entitled to consider Bistline’s age, health, and family circumstances, but that those could not justify the sentence imposed. On remand, the district court again imposed a sentence of one day’s confinement and 10 years’ supervised release, stating: “If I have got to send somebody like Mr.Bistline to prison, I’m sorry, someone else will have to do it. I’m not going to do it.” The Sixth Circuit vacated and remanded for reassignment and resentencing. View "United States v. Bistline" on Justia Law