Justia Legal Ethics Opinion Summaries

After obtaining a judgment against Defendants in a prior case, Plaintiffs filed this action against Defendants, their attorney, and others for fraudulent transfer, quiet title, and declaratory relief. Defendants filed a special motion to strike the entire complaint pursuant to the anti-SLAPP statute. At issue on appeal is whether the trial court erred in ruling Defendants failed to meet their initial burden of identifying all allegations of protected activity and the claims for relief supported by them. Further, the issue is whether the trial court’s earlier order granting the Defendants’ attorney’s anti-SLAPP motion compels the same outcome here.   The Second Appellate District affirmed the order denying Defendants’ anti-SLAPP motion. The court explained that where a defendant moves to strike the entire complaint and fails to identify, with reasoned argument, specific claims for relief that are asserted to arise from protected activity, the defendant does not carry his or her first-step burden so long as the complaint presents at least one claim that does not arise from protected activity. Here, Defendants not only failed to identify specific claims for relief arising from protected activity, they expressly asked the court to perform the type of gravamen analysis disapproved in Bonni. At no point did the Defendants “identify the activity each challenged claim rests on and demonstrate that that activity is protected by the anti-SLAPP statute.” And there are obviously claims in the complaint that do not arise from anti-SLAPP protected activity. View "Park v. Nazari" on Justia Law

Law firm Halscott Megaro, P.A. (“Halscott Megaro” or “the firm”) sued former clients and their guardians (collectively “former clients”), seeking to recover unpaid legal fees and expenses. A district court dismissed the action under Federal Rule of Civil Procedure 12(b)(6). The district court took judicial notice of a North Carolina State Bar Disciplinary Hearing Commission (“Commission”) decision that found the firm’s lead partner misled the former clients and engaged in other unethical conduct. The court then held the firm was precluded from relitigating issues decided by the Commission. It held that Halscott Megaro failed to plausibly plead claims for which relief could be granted. Halscott Megaro appealed, arguing the district court improperly considered matters outside the pleadings and failed to accept its allegations and all reasonable inferences from them as true in concluding that the Commission’s decision as to its lead partner bound the law firm.   The Fourth Circuit affirmed and held that the district court committed no reversible error in granting the former clients’ motion to dismiss or in denying the law firm’s motion for recusal. The court wrote that it agreed with the district court’s conclusion that the Commission was acting in a judicial capacity when it entered its discipline order against Megaro. The court also agreed that Megaro received a full and fair opportunity to litigate the issues and due process protections. Further, the court held that the firm’s allegations of impartiality were not related to any particular facts, sources or statements. A presiding judge is not required to recuse himself simply because of unsupported or highly tenuous speculation. View "Halscott Megaro, P.A. v. Henry McCollum" on Justia Law

SE Property Holdings, LLC (“SEPH”) obtained a deficiency judgment against Neverve LLC (“Neverve”) after Neverve defaulted on loans secured by a mortgage on its property. Following this judgment, Neverve received the proceeds from an unrelated settlement. But Neverve transferred those proceeds to attorneys representing Neverve’s principal in payment of attorney’s fees relating to the principal’s personal bankruptcy proceedings. SEPH then sued Neverve based on Neverve’s allegedly fraudulent transfer of those settlement proceeds. The district court granted summary judgment in favor of Neverve, finding that the Florida Uniform Fraudulent Transfer Act’s (“FUFTA”) “catch-all” provision did not allow for (1) an award of money damages against the transferor, (2) punitive damages, or (3) attorney’s fees. The court also granted summary judgment in favor of Neverve on SEPH’s equitable lien claim, as Neverve no longer possessed the settlement proceeds at issue.   The Eleventh Circuit affirmed. The court held that based on the narrow interpretation of FUFTA in Freeman v. First Union National Bank, 865 So. 2d 1272 (Fla. 2004), the court believes the Florida Supreme Court would determine that FUFTA’s catch-all provision does not allow for an award of money damages against the transferor, an award of punitive damages, or an award of attorney’s fees. Thus, the district court was correct in granting summary judgment in favor of Neverve on SEPH’s FUFTA claims. And the court concluded that the district court did not err in granting summary judgment in favor of Neverve on SEPH’s equitable lien claim. View "SE Property Holdings, LLC v. Neverve LLC" on Justia Law

After (Decedent) died, two of his three adult children brought a pro se diversity action in the District of Minnesota against Defendant, Decedent’s second wife. They asserted multiple claims arising from Defendant’s alleged use of her power as Decedent’s attorney-in-fact to close two Certificates of Deposit and keep funds that Decedent intended would benefit his children. Defendant moved to dismiss, alleging lack of diversity jurisdiction because Decedent’s third child, like Defendant, is a resident of California and is an indispensable, non-diverse party. Defendant filed a second motion to dismiss, arguing that Plaintiffs’ incomplete assignment did not establish diversity jurisdiction. The district court determined it has diversity subject matter jurisdiction and dismissed the FAC claims with prejudice because they fail to state a claim and Plaintiffs are not real parties in interest. Plaintiffs appealed the district court’s dismissal.   The Eighth Circuit affirmed. The court found that the district court properly granted Defendant’s Rule 12(b)(6) motion because Plaintiffs’ FAC failed to state plausible claims of fraudulent misrepresentation and civil theft. Therefore, the court wrote it need not separately consider the district court’s alternative ruling that Plaintiffs are not “real parties in interest” under Rule 17(a). Further, the court concluded the district court did not abuse its discretion in dismissing with prejudice the claims asserted in the FAC. The court explained it does not agree that additional claims regarding Defendant’s use of the CD proceeds after she was done acting as Attorney-in-Fact would necessarily have been futile. But without a proposed amended complaint to consider, the district court did not abuse its discretion by assuming they would be. View "Eric Sorenson v. Joanne Sorenson" on Justia Law

SM, AA and RM are the co-owners of Cannaco Research Corporation (CRC), a licensed manufacturer and distributor of cannabis products. All three individuals served as officers of CRC until February 2021, when AA and RM voted to remove SM from her position. SM sued AA, RM and others, including JA, AA’s husband, in a multicount complaint alleging causes of action for breach of contract, breach of fiduciary duty, fraud and other torts.   AA moved to disqualify SM counsel, Spencer Hosie and Hosie Rice LLP, on the ground SM had impermissibly downloaded from AA’s CRC email account private communications between AA and JA, protected by the spousal communication privilege and provided them to her attorneys, who then used them in an attempt to obtain a receivership for CRC in a parallel proceeding. The trial court granted the motion, finding that SM had not carried her burden of establishing AA had no reasonable expectation her communications with her husband would be private, and ordered the disqualification of Hosie and Hosie Rice.   The Second Appellate District affirmed. The court held that the evidence before the trial court supported its finding that AA reasonably expected her communications were, and would remain, confidential. And while the court acknowledged disqualification may not be an appropriate remedy when a client simply discusses with his or her lawyer improperly acquired privileged information, counsel’s knowing use of the opposing side’s privileged documents, however obtained, is a ground for disqualification. View "Militello v. VFARM 1509" on Justia Law

John and Tammy Sadek appealed orders denying their post-judgment motion and sanctioning their attorney under N.D.R.Civ.P. 11. Jason Weber was a Richland County, North Dakota sheriff’s deputy. Sadek acted as a confidential informant for Weber. Sadek was later found in the Red River with a gunshot wound to his head and a backpack full of rocks tied to his body. Sadek’s parents sued Weber and Richland County alleging Weber deceived Sadek by telling Sadek he faced a lengthy prison sentence. They also alleged Weber negligently caused Sadek’s death by failing to adequately train and protect him. The district court granted summary judgment in favor of Weber and Richland County: the misrepresentation underlying the deceit claim was a prediction of a future event and therefore not actionable as deceit as a matter of law; as to the negligence claim, there was no evidence to establish Weber’s conduct was the proximate cause of Sadek’s death. In the first appeal ("Sadek I"), the Sadeks argued a genuine issue of material fact existed as to whether Weber’s conduct caused Andrew Sadek’s death. The North Dakota Supreme Court affirmed, holding that "the evidence only presents a timeline of events and a request that a jury be allowed to speculate what happened as a result of that string of events." The Court's mandate affirming the dismissal judgment was issued on October 7, 2020. In 2022, the Sadeks filed a “Motion for Summary Judgment,” citing N.D.R.Civ.P. 60(b) but requested relief under N.D.R.Civ.P. 56. The Sadeks argued the district court made a mistake by relying on “bad faith” representations by Weber who “successfully hoodwinked [the district court] and obtained a Judgment of Dismissal.” Yet the Sadeks claimed they were entitled to summary judgment because “no triable issue of fact exists as to whether Defendants owed a duty of care to Andrew under the Statute.” The brief was accompanied by a list of signatures “verifying” they agreed with on Supreme Court Justice's dissent in Sadek I. The district court entered an order denying the Sadeks’ post-judgment motion, characterizing it as "baffling and bizarre." After review, the Supreme Court affirmed the district court’s orders and granted the Appellees’ motion for sanctions. View "Sadek, et al. v. Weber, et al." on Justia Law

Plaintiff, individually and as special administrator of the Estate of her father (collectively, “Plaintiffs”), appealed following the district court’s dismissal of her claims for legal malpractice, fraud, and deceit against attorneys (collectively, “the law firm”).   The Eighth Circuit granted Plaintiff’s motion to supplement the record. However, the court affirmed, reasoning that the court predicts the South Dakota Supreme Court would prohibit the assignment of legal malpractice claims and the district court did not err in dismissing the remaining claims. The court explained that Plaintiff asserts the district court erred when it dismissed her fraud and deceit claims against the law firm. To the extent Plaintiff intended to state a claim for fraud or deceit claim, no such claim actually appears in the amended complaint— especially in light of South Dakota’s requirement that fraud and deceit be pled with particularity. While the original complaint contained an allegation of fraud and deceit, the failure to retain that allegation in the amended complaint is dispositive. The only remaining allegations pertain to punitive damages, but an assertion of punitive damages is not a free-standing cause of action under South Dakota law. View "Teresa Thompson v. William Harrie" on Justia Law

Appellant a Louisiana attorney representing oil spill claimants in the settlement program, was accused of funneling money to a settlement program staff attorney through improper referral payments. In a disciplinary proceeding, the en banc Eastern District of Louisiana found that Appellant’s actions violated the Louisiana Rules of Professional Conduct and suspended him from practicing law before the Eastern District of Louisiana for one year. Appellant appealed, arguing that the en banc court misapplied the Louisiana Rules of Professional Conduct and abused its discretion by imposing an excessive sanction.   The Fifth Circuit found that the en banc court misapplied Louisiana Rules of Professional Conduct Rule 1.5(e) and 8.4(a) but not Rule 8.4(d). Additionally, the en banc court did not abuse its discretion by imposing a one-year suspension on Appellant for his violation of 8.4(d). Accordingly, the court reversed the en banc court’s order suspending Appellant from the practice of law for one year each for violations of Rule 1.5(e) and 8.4(a). The court affirmed the en banc court’s holding that Appellant violated Rule 8.4(d). Finally, the court remanded to the en banc court for further proceedings. On remand, the court is free to impose on Appellant whatever sanction it sees fit for the 8.4(d) violation, including but not limited to its previous one-year suspension. View "In re Jonathan Andry" on Justia Law

Janelle Henderson, a Black woman, and Alicia Thompson, a white woman, were involved in a motor vehicle collision. Thompson admitted fault for the collision but made no offer to compensate Henderson for her injuries. Henderson claimed that her preexisting condition was seriously exacerbated by the collision and sued for damages. During the trial, Thompson’s defense team attacked the credibility of Henderson and her counsel—also a Black woman—in language that called on racist tropes and suggested impropriety between Henderson and her Black witnesses. The jury returned a verdict of only $9,200 for Henderson. Henderson moved for a new trial or additur on the ground that the repeated appeals to racial bias affected the verdict, yet the trial court did not even grant an evidentiary hearing on that motion. The court instead stated it could not “require attorneys to refrain from using language that is tied to the evidence in the case, even if in some contexts the language has racial overtones.” The Washington Supreme Court concluded the trial court abused its discretion by failing to grant an evidentiary hearing and also by failing to impose any sanctions for Thompson’s discovery violations. Judgment was reversed and remanded for further proceedings. View "Henderson v. Thompson" on Justia Law

Plaintiff a female employee of Wakulla County (“the County”), worked for the County’s building department. Plaintiff filed a lawsuit in federal district court for, among other claims, the County’s violation of Title VII of the Civil Rights Act of 1964. In the present case, Plaintiff filed a five-count complaint against the defense attorneys for the County. The defense attorneys and their law firms filed several motions to dismiss under Federal Rule of Civil Procedure 12(b)(6). The district court dismissed the complaint, explaining that Plaintiff’s alleged facts did not demonstrate that the defense attorneys for the County had engaged in a conspiracy that met the elements of 42 U.S.C. Section 1985(2).   Plaintiff’s complaint suggested that the defense attorneys filed the complaint for the “sole benefit of their client rather than for their own personal benefit.” Alternatively, Plaintiff points to the fact that the County defense attorneys had been aware of Plaintiff’s recordings for many months and only reported her recordings to law enforcement when they learned that Plaintiff “insist[ed] on her right to testify in federal court about the recordings and present them as evidence” in the sexual harassment case.   The Eleventh Circuit affirmed. The court explained that per Farese, it is Plaintiff’s burden to allege facts that establish that the County defense attorneys were acting outside the scope of their representation when they told law enforcement about Plaintiff’s recordings. Here, Plaintiff but in no way suggests that the defense attorneys were acting outside the scope of their representation, thus her Section 1985(2) claims were properly dismissed. View "Tracey M. Chance v. Ariel Cook, et al" on Justia Law