Justia Legal Ethics Opinion Summaries

CAI filed suit against state prosecutors, seeking to enjoin the enforcement of state unauthorized practice of law (UPL) statutes against it. The Fourth Circuit affirmed the district court's grant of summary judgment to defendants, holding that the UPL statutes did not unconstitutionally restrict CAI's associational rights. In this case, like the solicitation statute in Ohralik v. Ohio State Bar Ass'n, 436 U.S. 447 (1978), North Carolina's UPL statutes only marginally affected First Amendment concerns and did not substantially impair the associational rights of CAI.The court also held that the UPL statutes did not unlawfully burden CAI's freedom of speech. Determining that intermediate scrutiny was the appropriate standard for reviewing conduct regulations that incidentally impact speech, the court held that barring corporations from practicing law was sufficiently drawn to protect clients. The court also held that the UPL statutes did not deny CAI due process, were not unconstitutionally vague, and did not violate the state constitution's Monopoly Clause. Finally, CAI's commercial speech claim was not an independent basis for granting relief and the state may forbid CAI from advertising legal services barred by law. View "Capital Associated Industries v. Stein" on Justia Law

The Fourth Circuit reversed the district court's order denying Citizens' motion for attorney's fees, expert fees, and costs stemming from a 42 U.S.C. 1983 action that successfully challenged a 2015 state law that redrew Greensboro City Council districts. The court held that civil rights fee-shifting statutes, such as those at issue here, are not meant to punish defendants for a lack of innocence or good faith but rather to "compensate civil rights attorneys who bring civil rights cases and win them." The court explained that "innocence" or a "lack of responsibility" for the enactment of an unconstitutional law was therefore not an appropriate criterion to justify denying a fee award against the party responsible for and enjoined from enforcing the unconstitutional law. View "Brandon v. Guilford County Board of Elections" on Justia Law

The Fourth Circuit affirmed the district court's order sanctioning three attorneys and their law firms under both its inherent authority and 28 U.S.C. 1927. The court held that the district court did not abuse its discretion in awarding compensatory sanctions totaling $150,000. In this case, the sanctioned attorneys' objections to the authenticity of certain documents abused the judicial process both because they lacked a good faith basis and because the attorneys made repeated misrepresentations to the court in order to sustain these objections. Furthermore, under section 1927, the district court found that the attorneys engaged in bad-faith conduct and that this conduct multiplied the proceedings unreasonably and vexatiously. The court held that the district court correctly articulated the applicable legal standards, made appropriate factual findings, and supported its conclusions with ample evidence from the record. View "Six v. Generations Federal Credit Union" on Justia Law

Verisign filed suit against XYZ, alleging false advertising based on a false "gold rush" scheme involving domain names. The district court ultimately granted summary judgment for XYZ, but denied it attorney fees under the Lanham Act, 15 U.S.C. 1117(a). The Fourth Circuit held that a prevailing party need only prove an exceptional case by a preponderance of the evidence, rather than by clear and convincing evidence. The court further clarified that a prevailing party need not establish that the losing party acted in bad faith in order to prove an exceptional case. Therefore, the court remanded for the district court to consider the motion under the appropriate legal and evidentiary standards. View "Verisign, Inc. v. XYZ.Com LLC" on Justia Law

Intervening defendants could not be required to pay a portion of prevailing plaintiffs' attorneys fees and costs, awarded under 42 U.S.C. 1988(b) and 52 U.S.C. 10310(e), when intervening defendants were not charged with any wrongdoing and could not be held liable for the relief that plaintiffs sought. In Independent Federation of Flight Attendants v. Zipes, 491 U.S. 754 (1989), the Supreme Court precluded the assessment of attorneys fees and costs against intervenors who were "blameless," meaning that they were not charged as wrongdoers and legal relief could not have been obtained from them. In this racial gerrymandering case, the Fourth Circuit held that Zipes was controlling and that the Commonwealth could not be held liable for attorneys fees and costs incurred by plaintiffs in litigating against the entry of Intervening Congressmen or against Intervening Congressmen's positions. Under the traditional American rule, plaintiffs must bear those intervention-related fees. Accordingly, the court vacated the district court's order awarding attorneys fees and costs, remanding for reconsideration of plaintiffs' petitions for fees. View "Brat v. Personhuballah" on Justia Law

Intervening defendants could not be required to pay a portion of prevailing plaintiffs' attorneys fees and costs, awarded under 42 U.S.C. 1988(b) and 52 U.S.C. 10310(e), when intervening defendants were not charged with any wrongdoing and could not be held liable for the relief that plaintiffs sought. In Independent Federation of Flight Attendants v. Zipes, 491 U.S. 754 (1989), the Supreme Court precluded the assessment of attorneys fees and costs against intervenors who were "blameless," meaning that they were not charged as wrongdoers and legal relief could not have been obtained from them. In this racial gerrymandering case, the Fourth Circuit held that Zipes was controlling and that the Commonwealth could not be held liable for attorneys fees and costs incurred by plaintiffs in litigating against the entry of Intervening Congressmen or against Intervening Congressmen's positions. Under the traditional American rule, plaintiffs must bear those intervention-related fees. Accordingly, the court vacated the district court's order awarding attorneys fees and costs, remanding for reconsideration of plaintiffs' petitions for fees. View "Brat v. Personhuballah" on Justia Law