Justia Legal Ethics Opinion Summaries

Plaintiffs were represented by defendant attorneys in an action against State Farm arising out of the 1994 Northridge earthquake. Court-appointed retired judges presided over a 1997 aggregate settlement. In 2012, one of the plaintiffs conducted a random sampling of other plaintiffs’ awards in the action, which, they claimed, revealed that the defendants had not properly disbursed or accounted for the settlement funds and had concealed this conduct from plaintiffs. Plaintiffs sought damages for failure to obtain their informed consent to an aggregate settlement and misappropriation of and failure to account for the settlement funds. The trial court dismissed, finding the claims based on speculation and barred by the statute of limitations. The court of appeal affirmed, rejecting arguments that the statute of limitations had not run under Probate Code section 16460 because they had no notice of wrongdoing and that actions for violations of Business and Professions Code section 6091 in failing to provide an accounting are not barred because their action was filed within one year of failure to comply with the statute. Where there are facts sufficient to put one on inquiry notice, the fraud statute of limitations starts running even when the defendant is a fiduciary. View "Britton v. Girardi" on Justia Law

Utrecht represented Loanvest in a lawsuit arising out of a loan that was secured by an interest in Oakland property. Utrecht successfully opposed Madow’s motion for a preliminary injunction that would have prevented Loanvest from paying out of the proceeds of the property’s sale. In 2013, Madow became manager of Loanvest, which then sued Utrecht, claiming breach of the duty of loyalty and “looting” Loanvest to pay other obligations. The trial court dismissed under the anti-SLAPP (strategic lawsuit against public participation) statute (Code Civ. Proc., 425.16), finding that the claim was based on an act in furtherance of the right of petition and that Loanvest failed to make a prima facie showing of its ability to prevail in the action. The court of appeal reversed. Loanvest is not a third party allegedly harmed by Utrecht’s representation of another client, but Utrecht’s former client that allegedly was harmed as the result of his “egregiously breaching the duty of loyalty.” That the complaint refers to another as Utrecht’s “true client” and Loanvest as his “purported client” does not alter that admitted fact. A lawsuit that concerns a breach of duty does not depend on the exercise of a constitutional right. View "Loanvest I, LLC v. Utrecht" on Justia Law

Amis alleged that his former attorneys committed malpractice by “caus[ing]” him to execute a settlement agreement that converted his company’s corporate obligations into Amis’s personal obligations without advising Amis that he had little to no risk of personal liability in the underlying litigation. All advice he received from the attorneys regarding the settlement agreement was given during mediation. The attorneys argued that Amis could not obtain evidence to support his claims, and that the law firm could not produce evidence to defend itself, because the disclosure of such evidence was barred by the mediation confidentiality statutes, Evidence Code section 1115. The trial court agreed on both counts and entered summary judgment for the firm. The court of appeal affirmed. The California Supreme Court has broadly applied the mediation confidentiality statutes and all but categorically prohibited judicially crafted exceptions, even in situations where justice seems to call for a different result. View "Amis v. Greenberg Traurig, LLP" on Justia Law

This matter stemmed from a recommendation of the Judiciary Commission of Louisiana regarding the failure of respondent Justice of the Peace Lorne L. Landry to comply with the financial reporting requirements of Supreme Court Rule XXXIX. Upon review, the Supreme Court found that the record established by clear and convincing evidence that Respondent willfully and knowingly failed to comply with the filing requirement of Rule XXXIX, thereby subjecting him to discipline. Respondent was ordered to pay a civil penalty of $500, plus costs. Respondent was further ordered to file his 2011 financial disclosure statement. View "In re: Justice of the Peace Lorne L. Landry, Plaquemines Parish, Ward 8" on Justia Law

This matter comes before the court on the recommendation of the Judiciary Commission of Louisiana that Judge Sheva M. Sims of the Shreveport City Court, Caddo Parish, be suspended without pay for 90 days and ordered to reimburse the Commission's costs. The charge arose from an incident that occurred between Judge Sims and an assistant city prosecutor, Katherine Gilmer, on April 24, 2012, wherein Judge Sims stated that Ms. Gilmer was “held in contempt” of court and then ordered the dismissal of fifteen criminal cases on the docket that day. After reviewing the record and applicable law, the Supreme Court found that the charge against Judge Sims was supported by clear and convincing evidence. However, the Court rejected the recommended discipline and instead ordered Judge Sims be suspended without pay for a period of 30 days. Furthermore, the Court ordered Judge Sims to reimburse the Commission’s costs incurred relative to its investigation and prosecution of this case. View "In re: Judge Sheva M. Sims, Shreveport City Court, Caddo Parish" on Justia Law

Tuzzolino and his law firm represented Coletta. Coletta alleged that, in litigation, Tuzzolino failed to timely disclose expert witnesses; failed to retain needed expert witnesses; advised Coletta to settle for an amount far less than Coletta’s losses; told Coletta that negotiations were continuing after dismissal; and signed settlement documents without informing Coletta. According to Coletta, Tuzzolino offered to pay $670,000 to settle any potential malpractice claim, but never paid. Three months later, shortly before the expiration of the firm’s 2007-08 malpractice policy with ISBA Mutual, Tuzzolino completed a renewal application. In response to: “Has any member of the firm become aware of a past or present circumstance(s), act(s), error(s) or omission(s), which may give rise to a claim that has not been reported?” Tuzzolino checked “no.” Mutual issued the policy. Tuzzolino’s partner, Terpinas, learned of Tuzzolino’s malfeasance a month later, when he received a lien letter from Coletta’s attorney. Terpinas reported the claim to Mutual, which sought rescission and other relief. The circuit court entered summary judgment against Tuzzolino and rescinded the policy, finding that Mutual had no duty to defend Terpinas or the firm against Coletta’s action. The appellate court reversed as to Terpinas, citing the common law “innocent insured doctrine.” The Illinois Supreme Court reinstated the rescission, citing 215 ILCS 5/154, which allows rescission in cases involving misrepresentations “made by the insured or in his behalf,” with an actual intent to deceive or that “materially affect the acceptance of the risk or hazard assumed by the insurer.” View "Ill. State Bar Ass'n Mut. Ins. Co. v. Law Office of Tuzzolino & Terpinas" on Justia Law

Guam attorney Lujan was sued in two lawsuits in Hawaii, followed by another in California, which could have cost him millions of dollars, loss of reputation, and possibly his license to practice law. He hired a law firm with offices in San Francisco and Guam to represent him, which included filing two more proceedings. The representation generated significant billings about which Lujan complained, refusing to pay a large balance. The firm withdrew from the representation, and sued. A jury returned a verdict for the firm of $945,947.90 “together with its disbursements and costs, including expert witness fees, in the amount of $_____, prevailing party attorneys’ fees as allowed by contract in the amount of $_____, and pre-judgment interest as allowed by contract in the amount of $_____.” The court later awarded $331,545.51 in prejudgment interest. The California Court of Appeal affirmed. The firm filed a memorandum of costs and a motion for attorney fees based on the engagement letter Lujan had signed. Following thousands of pages of briefing and oral argument, the trial court forwarded $1,532,674 in attorney fees, and $123,227 in expert witness fees, based on a Code of Civil Procedure section 998 offer. The court of appeal affirmed. View "Calvo, Fisher & Jacob v. Lujan" on Justia Law

Spencer stopped paying her mortgage in 2008. In Wisconsin state court foreclosure proceedings, Spencer’s attorney, Nora, adopted an “object-to-everything litigation strategy and buried the state court in a blizzard of motions.” While a hearing on a summary judgment motion was pending in state court, Nora removed the case to federal court. Finding no objectively reasonable basis for removal, the district court remanded the case and awarded attorney’s fees and costs to the lender, 28 U.S.C. 1447(c). The Seventh Circuit dismissed Spencer’s appeal as frivolous; the district court did not order her to pay anything. The court affirmed the award as to Spencer “because she has not offered even a colorable argument that removal was reasonable” and ordered Nora to show cause why she should not be sanctioned for litigating a frivolous appeal. Several months later, noting Nora’s similar behavior in another case, the court imposed an increased sanction of $2,500, suspended until the time, if ever, that Nora submits further inappropriate filings, and directed the clerk of court to forward a copy of the order and earlier opinion to the Office of Lawyer Regulation of the Wisconsin Supreme Court. View "PNC Bank v. Spencer" on Justia Law

HSBC initiated a Wisconsin foreclosure action on the Rinaldi’s mortgage. The Rinaldis counterclaimed, alleging that the mortgage paperwork had been fraudulently altered and that HSBC lacked standing to enforce the mortgage. The Rinaldis lost at summary judgment and did not appeal. The court later vacated its foreclosure judgment after HSBC agreed to modify the loan. The Rinaldis filed a new state lawsuit reasserting their counterclaims. Before the court ruled on the defendants’ motion to dismiss, the Rinaldis filed for bankruptcy. In those proceedings, HSBC filed a proof of claim for the mortgage. The Rinaldis objected and filed adversary claims, alleging fraud, abuse of process, tortious interference, breach of contract, and violations of RICO and the Fair Debt Collection Practices Act. The bankruptcy court found in favor of HSBC and recommended denial of the adversarial claims. The district court agreed, noting the Rinaldis’ failure to comply with Federal Rules. The court dismissed the Rinaldis’ adversary claims as meritless and warned that the Rinaldis would face sanctions if they filed additional frivolous filings because their tactics had “vexatious and time- and resource-consuming” and their filings “nigh-unintelligible.” After additional filings of the same type, the Rinaldis voluntarily dismissed their bankruptcy. Their attorney filed additional frivolous motions. The court ordered the attorney to pay $1,000. The Seventh Circuit upheld the sanction. View "Nora v. HSBC Bank USA, N.A." on Justia Law

Anten and the Rubins jointly retained Gelfand and Kirios of the Weintraub law firm to advise and represent them on a matter of common interest: incorrect advice given by their prior tax attorneys. Anten filed a malpractice action against those lawyers concerning that representation. In response to discovery propounded by Anten, the lawyers objected that Anten’s discovery sought communications between the lawyers and the Rubins that were protected by the attorney-client privilege, which the Rubins expressly declined to waive. The superior court denied a motion to compel further responses, on the basis of the attorney-client privilege objection. The court of appeal granted Anten writ relief. In a lawsuit between the attorney and one or more of the attorney’s joint clients, based on an alleged breach of a duty arising from the attorney-client relationship, relevant communications between the attorney and any of the joint clients, made in the course of the attorney-joint-client relationship, are not privileged. View "Anten v. Super. Court" on Justia Law