Justia Legal Ethics Opinion Summaries

The Perishable Agricultural Commodities Act (PACA), 7 U.S.C. 499e, is a Depression-era statute designed to protect sellers of perishable produce form delinquent purchasers. In this case, two such purchasers filed for bankruptcy and the bankruptcy court appointed special counsel to collect and disburse funds to PACA-protected sellers that had claims against the purchasers-turned-debtors. At issue on appeal is whether special counsel’s (Stokes) fees and expenses be disbursed from the PACA fund. Nowhere in the orders on the interim appeals is there an indication that the district court realized these were interlocutory orders and believed there was a benefit to hearing them in this piecemeal manner. That absence means the district court did not have appellate jurisdiction over the first two interim fee orders. Therefore the court vacated for lack of jurisdiction the district court’s order vacating the first and second fee awards. The court found that Kingdom Fresh has no standing to dispute the percentage of Stokes’s fee allocable to the nonobjecting parties. Only the small percentage of Stokes’s fee apportionable to Kingdom Fresh is at issue in this appeal; Stokes is free to keep the remainder. The court agreed with the Second Circuit that PACA’s unequivocal language requires that a PACA trustee - or in this case, its functional equivalent - may not be paid from trust assets “until full payment of the sums owing” is paid to all claimants. Accordingly, the court affirmed the district court's order vacating the final fee award, but only as to Kingdom Fresh's pro rata share of the fees. View "Kingdom Fresh Produce, Inc., et al v. Delta Produc" on Justia Law

Larkin moved to withdraw as counsel of Maid-Rite and two of the company's employees, after the franchisor failed to pay for its legal fees and to provide important information related to its defense. The district court denied Larkin's motion. The court concluded that, based on the record, it was presumptively appropriate for Larkin to seek withdrawal where defendants' failure to provide the firm with important information related to their defense also failed to fulfill an obligation to the firm. Further, defendants were warned several times and notified about the motion to withdraw. The court also concluded that defendants were not prejudiced by the withdrawal nor were third parties prejudiced by the withdrawal. Accordingly, the court reversed and remanded. View "Sanford v. Larkin Hoffman Daly & Lindgren" on Justia Law

Plaintiff filed suit against the State Bar, alleging a due process claim under 42 U.S.C. 1983. Specifically, plaintiff alleged that the State Bar’s rules applied the same standards and procedures for reinstatement for disbarred attorneys to attorneys suspended for more than 90 days, amounted to “defacto disbarment,” and violated his Fourteenth Amendment due process rights. The district court dismissed the complaint as barred by the Eleventh Amendment and then denied plaintiff's motion to alter or amend the judgment. Determining that the court has jurisdiction to hear plaintiff's appeal, the court agreed with the district court's conclusion that the Alabama State Bar is an arm of the state of Alabama and thus enjoys Eleventh Amendment immunity from plaintiff's section 1983 claim. Further, the court concluded that the district court did not abuse its discretion in denying plaintiff's FRCP 59(e) motion where, to the extent plaintiff contends his due process claim was a “direct action” under the Fourteenth Amendment, his amended complaint did not allege such a claim, and he could not use his Rule 59(e) motion to do so. Accordingly, the court affirmed the judgment. View "Nichols v. Alabama State Bar" on Justia Law

Plaintiffs filed a putative class action against Allen Standford's lawyers, Thomas Sjoblom, and the law firms where he worked, arguing that they aided and abetted Stanford’s fraud and conspired to thwart the SEC’s investigation of Stanford’s Ponzi scheme. The district court subsequently denied defendants' motion to dismiss the complaint as barred by the attorney immunity under Texas law. The court held that, under Texas law, attorney immunity is a true immunity of suit, such that denial of a motion to dismiss based on attorney immunity is appealable under the collateral order doctrine. The court reversed the district court’s order denying defendants’ motions to dismiss based on attorney immunity now that the Texas Supreme Court has clarified that there is no “fraud exception” to attorney immunity. Accordingly, the court rendered judgment that the case is dismissed with prejudice. View "Troice v. Proskauer Rose, L.L.P." on Justia Law

Bobby Gibson filed a legal-malpractice action against Joe Montgomery and his law firm, Williams, Williams and Montgomery, P.A. (“WWM”), alleging wrongful conduct in connection with the administration of his late wife Debbie's estate. The trial court granted summary judgment to Montgomery and WWM. The Supreme Court reversed and remanded. Bobby timely filed his Notice of Appeal and raised four issues: 1) whether the doctrines of res judicata or collateral estoppel barred his claims, 2) whether judicial estoppel precluded his malpractice action, 3) whether the thirty-day period provided in Section 11-1-39 required dismissal, and 4) whether there remains a genuine issue of material fact as to the elements of his legal-malpractice and fiduciary-duty claims. After review, the Supreme Court concluded: Bobby's claims were not precluded by the doctrines of res judicata and collateral estoppel; judicial estoppel did not preclude Bobby's legal-malpractice action; there was no merit to Montgomery's Section 11-1-39 argument; and there remained a genuine issue of material fact as to whether an attorney-client relationship existed. View "Gibson v. Williams, Williams & Montgomery, P.A." on Justia Law

This appeal stemmed from a dispute regarding a contract the parties entered into, which gave Lewmar the exclusive right to manufacture and sell Steinerʹs patented sailboat winch handle, a device used to control the lines and sails of a sailboat. The parties resolved the dispute when Lewmar made, and Steiner accepted, an offer of judgment under Rule 68 of the Federal Rules of Civil Procedure. After judgment was entered, Steiner moved for attorneysʹ fees of $383,804 and costs of $41,470. The district court denied attorneysʹ fees but awarded costs of $2,926. The court concluded that Steiner was precluded from seeking fees pursuant to the Agreement in addition to the $175,000 settlement amount because claims under the Agreement were unambiguously included in the Offer; Steiner was not precluded from seeking attorneysʹ fees under the Connecticut Unfair Trade Practices Act (CUTPA), Conn. Gen. Stat. 42‐110g(d), because the Offer did not unambiguously encompass claims for attorneysʹ fees under CUTPA; and the court remanded for the district court to clarify whether it considered the claim for attorneys' fees under CUTPA on the merits and if not, to do so. Finally, the court concluded that the district court correctly added costs under the ʺcosts then accruedʺ provision of Rule 68. View "Steiner v. Lewmar, Inc." on Justia Law

Hassebrock hired the Bernhoft Law Firm in 2005 to help with legal problems, including a federal criminal tax investigation, a civil case for investment losses, and a claim against Hassebrock’s previous lawyers for fees withheld from a settlement. Hassebrock was ultimately found guilty, sentenced to 36 months in prison, and ordered to pay a fine and almost $1 million in restitution. In 2008, Hassebrock fired the Bernhoft firm. In a malpractice suit against the Bernhoft attorneys and accountants, Hassebrock waited until after discovery closed to file an expert-witness disclosure, then belatedly moved for an extension. The court denied the motion and disallowed the expert, resulting in summary judgment for the defendants. The Seventh Circuit affirmed, rejecting an argument that the judge should have applied the disclosure deadline specified in FRCP 26(a)(2)(D) rather than the discovery deadline set by court order. The disclosure deadline specified in Rule 26(a)(2)(D) is just a default deadline; the court’s scheduling order controls. It was well within the judge’s discretion to reject the excuses offered by Hassebrock to explain the tardy disclosure. Because expert testimony is necessary to prove professional malpractice, summary judgment was proper as to all defendants. View "Hassebrock v. Bernhoft" on Justia Law

Queen’s University at Kingston, Canada, owns patents directed to Attentive User Interfaces, which allow devices to change their behavior based on the attentiveness of a user—for example, pausing or starting a video based on a user’s eye-contact with the device. Queen’s sued, alleging that Samsung’s SmartPause feature infringed those patents. Throughout fact discovery, Queen’s University refused to produce certain documents. It produced privilege logs that withheld documents based on its assertion of a privilege relating to communications with its patent agents. A magistrate granted Samsung’s motion to compel, finding that the communications between Queen’s University employees and their non-attorney patent agents are not subject to the attorney-client privilege and that a separate patent-agent privilege does not exist. The district court declined to certify the issue for interlocutory appeal, but agreed to stay the production of the documents at issue pending a petition for writ of mandamus. The Federal Circuit granted that petition, finding that, consistent with Federal Rule of Evidence 501, a patent-agent privilege is justified “in the light of reason and experience” and extends to communications with non-attorney patent agents when those agents are acting within the agent’s authorized practice of law before the Patent Office. View "In Re: Queen's Univ. at Kingston" on Justia Law

Plaintiff, a member of the Westboro Baptist Church, filed suit in 2006 against Missouri state and state officials after the Missouri General Assembly enacted statewide restrictions on pickets and protests near funerals and funeral processions. In 2014, Missouri appealed the statute at issue while plaintiff's Rule 59(e) motion remained pending in district court. In this appeal, plaintiff challenged the district court's adverse judgments on her due process claim as well as the court's award of attorneys' fees. The court vacated the district court's judgment on the due process claim and remanded with instructions to dismiss her claim as moot. In regard to the attorneys' fees, the court concluded that the district court's 2/14th calculation was an abuse of discretion because its arithmetically simplistic fee calculation did not accurately reflect her degree of success of her interrelated claims. Moreover, even if the court accepted the district court's basic mathematical approach, its 2/14th calculation is inaccurate because it did not address whether it counted consent judgments, mooted claims, and dismissed claims as prevailing, neutral, or unsuccessful claims. Accordingly, the court reversed the district court's award of attorneys' fees. View "Phelps-Roper v. Koster" on Justia Law

In their one-day dissolution trial, Paul was represented by his attorney. Susan was not represented by counsel. The court denied Susan’s continuance request and admitted Paul’s 22 exhibits into evidence.The court entered a judgment dissolving the marriage, declining to award spousal support to either party, dividing the couple’s property, stating that Susan waived future spousal support and that the court would not have awarded spousal support in any event because “each party was self-supporting,” and finding that Paul was entitled to a credit of $2,500 for support payments he had made to Susan in 2012 and 2013. Susan timely filed notice of appeal. Because there had been no court reporter, Susan requested a settled statement under California Rules of Court, 8.137. The court of appeal vacated; the order cannot stand because it was entered without a motion, without the required findings, and based on the false premise that Susan was responsible for the protracted nature of the proceedings on her motion. View "Mooney v. Superior Court" on Justia Law