Justia Professional Malpractice & Ethics Opinion Summaries

Attorney Stephen Eberhardt filed a 102-page, 19-count complaint against 11 defendants, including the Village of Tinley Park, its officials, attorneys, and residents, alleging a scheme to prevent him from making public comments at Village board meetings and on Village-related Facebook pages, violating his constitutional rights. He also brought claims against the Village’s outside counsel, Patrick Walsh, under the Illinois Open Meetings Act. The district court dismissed the complaint without prejudice for being too lengthy and jumbled. Eberhardt then filed an amended complaint, which was also dismissed, and the court entered final judgment.Following the judgment, Walsh’s attorney filed a motion for sanctions under Rule 11 of the Federal Rules of Civil Procedure, arguing that Eberhardt’s claims were frivolous and filed in bad faith to harass Walsh. The district court granted the motion, ordering Eberhardt to pay $26,951.22 in attorneys’ fees, finding that his claims were frivolous and brought with inadequate investigation into the relevant law and facts. The court noted Eberhardt’s history of filing numerous lawsuits and motions, which indicated bad faith.Eberhardt appealed to the United States Court of Appeals for the Seventh Circuit, challenging the district court’s decision to sanction him and its denial of his motion to reconsider. The Seventh Circuit reviewed the case and found no abuse of discretion in the district court’s decisions. The court affirmed the sanctions order, agreeing that Eberhardt’s claims were frivolous and brought in bad faith, and that a hearing was not necessary as the record was adequate to determine the need for sanctions. The court also affirmed the denial of the motion to reconsider, finding no manifest errors of law or fact. View "Eberhardt v. Walsh" on Justia Law

In 2001, Alphonse Fletcher, Jr. acquired property associated with two apartment units in a residential cooperative corporation controlled by The Dakota, Inc. In 2008, JP Morgan Chase Bank, N.A. approved a loan to Fletcher, secured by his rights in the property. Fletcher, Chase, and The Dakota entered into an agreement recognizing The Dakota's priority to proceeds from any sale or subletting of Fletcher's apartments. In 2011, Fletcher sued The Dakota for racial discrimination, and The Dakota counterclaimed for legal fees and costs based on Fletcher's proprietary lease.The Supreme Court granted summary judgment to The Dakota in the Fletcher action and awarded attorneys' fees and costs. While this action was pending, Kasowitz, Benson, Torres & Friedman, LLP initiated a CPLR 5225 proceeding against Chase, The Dakota, and Fletcher to seize and sell Fletcher's apartments to satisfy a judgment for unpaid legal fees. The Dakota claimed a superior interest in Fletcher's property based on the fee judgment, while Chase argued that The Dakota's lien was not superior and that the lease provision authorizing attorneys' fees was either inapplicable or unconscionable.The Supreme Court granted summary judgment to The Dakota, and the Appellate Division affirmed, stating that Chase's contentions were an impermissible collateral attack on The Dakota's judgment. Chase moved for leave to appeal and to intervene and vacate the judgment in the Fletcher action. The Supreme Court denied Chase's motion, but the Court of Appeals granted leave to appeal.The New York Court of Appeals held that Chase, as a nonparty to the original action, was not barred from challenging the fee award in a separate proceeding. The court concluded that Chase was not required to intervene in the Fletcher action to protect its interests and that doing so would violate Chase's due process rights. The order of the Appellate Division was reversed, and the matter was remitted for further proceedings. View "Matter of Kasowitz, Benson, Torres & Friedman, LLP v JPMorgan Chase Bank, N.A." on Justia Law

Gary Everett Martin obtained a home-equity line of credit (HELOC) from BBVA USA Bancshares, Inc. (BBVA) in May 2008, secured by a mortgage on his residential property. In June 2008, Martin hired Joseph T. Scarborough, Jr., and Scarborough & Griggs, LLC (S&G) for legal representation in a divorce action. In June 2012, Martin executed a promissory note in favor of S&G for legal fees, secured by a second mortgage on the property. The attorney-client relationship ended in June 2013, and the promissory note and mortgage were later assigned to Scarborough. In June 2019, BBVA foreclosed on the property, and Scarborough purchased it at the foreclosure sale.The Lee Circuit Court granted summary judgment in favor of Scarborough, S&G, and BBVA, dismissing Martin's counterclaims and awarding possession of the property to Scarborough. The court found Martin's claims against the Scarborough parties time-barred under the Alabama Legal Services Liability Act (ALSLA) and dismissed his claims against BBVA as time-barred or unsupported by substantial evidence.The Supreme Court of Alabama reviewed the case. It found a genuine issue of material fact regarding the validity of the foreclosure sale, as the sale price was significantly lower than the property's fair market value, potentially indicating fraud or unfairness. Consequently, the court reversed the summary judgment in favor of Scarborough on his ejectment claim and remanded the case for further proceedings. However, the court affirmed the summary judgment in favor of the Scarborough parties and BBVA regarding Martin's counterclaims, finding them time-barred or unsupported by substantial evidence. View "Martin v. Scarborough" on Justia Law

Allison Littlefield filed a verified petition against her brothers, Scott and David Littlefield, and her aunt, Denise Sobel, who are co-trustees of The Pony Tracks Ranch Trust. The petition sought their removal as co-trustees, alleging breaches of fiduciary duty and the Trust, and requested declaratory and injunctive relief. Allison claimed that the appellants misused Trust funds, concealed information, converted her personal property, restricted her use of the Ranch, and failed to address misconduct by an employee, Stacey Limbada, who allegedly harassed Allison and her husband.The San Mateo County Superior Court denied the appellants' special motion to strike the petition under California's anti-SLAPP statute, concluding that the appellants failed to show that Allison's petition arose from protected activity. The court also denied Allison's request for attorney's fees, finding that the motion was not frivolous or solely intended to cause unnecessary delay.The California Court of Appeal, First Appellate District, Division Four, reviewed the case. The court affirmed the trial court's denial of the anti-SLAPP motion, agreeing that the appellants did not meet their burden of showing that the petition was based on protected activity. The court noted that the appellants' motion failed to identify specific allegations of protected activity and improperly sought to strike the entire petition or all causes of action without distinguishing between protected and unprotected conduct.However, the appellate court reversed the trial court's denial of Allison's request for attorney's fees, finding that the anti-SLAPP motion was frivolous. The court held that any reasonable attorney would agree that the motion was totally devoid of merit, as it did not demonstrate that the petition sought to impose liability based on protected activity. The case was remanded for a determination of the appropriate award of attorney's fees for Allison. View "Littlefield v. Littlefield" on Justia Law

LCPFV, LLC owned a warehouse with a faulty sewer pipe. After experiencing toilet backups, LCPFV hired Rapid Plumbing to fix the issue for $47,883.40. Rapid's work was unsatisfactory, leading LCPFV to hire another plumber for $44,077 to correct the problem. LCPFV sued Rapid Plumbing, which initially appeared in court but later defaulted. LCPFV sought a default judgment of $1,081,263.80, including attorney fees and punitive damages. The trial court awarded a default judgment of $120,319.22, significantly less than LCPFV's demand, and also awarded $11,852.90 in sanctions.The Superior Court of Los Angeles County, presided over by Judge Mark V. Mooney, reviewed the case. The court scrutinized LCPFV's default judgment package and found the requested amount excessive. The court emphasized its role as a gatekeeper in default judgment cases, ensuring that only appropriate claims are granted. The court rejected LCPFV's use of requests for admissions obtained after Rapid Plumbing had ceased participating in the case, citing a lack of candor and evidentiary value.The California Court of Appeal, Second Appellate District, Division Eight, reviewed the case. The court affirmed the lower court's judgment, agreeing that the trial court acted within its discretion in rejecting the inflated default judgment request. The appellate court upheld the trial court's decision to award $120,319.22, including $91,960.40 for breach of contract and $4,948.46 in attorney fees, rejecting the fraud and punitive damages claims. The court also affirmed the sanctions award and the decision to grant prejudgment interest from the date of the lawsuit filing, not from the date of payment to Rapid Plumbing. The appellate court found no abuse of discretion in the trial court's rulings and emphasized the importance of judicial vigilance in default judgment cases. View "LCPFV v. Somatdary" on Justia Law

In this case, the petitioner, Aaron W., appealed an order from the Intermediate Court of Appeals of West Virginia (ICA) that dismissed his appeal of a family court order. The family court had disqualified Aaron W.'s attorney from representing him in a divorce proceeding due to a conflict of interest, as the attorney had previously represented both parties in a related personal injury case. The family court's order included language indicating it was a final, appealable order.Initially, Aaron W. sought a writ of prohibition from the Circuit Court of Kanawha County to prevent the family court from ruling on the disqualification motion, arguing that the family court lacked jurisdiction. The circuit court denied the writ, and the Supreme Court of Appeals of West Virginia affirmed, holding that family courts have the authority to disqualify attorneys in cases of conflict of interest.Aaron W. then appealed the family court's disqualification order to the ICA, which dismissed the appeal, concluding that the order was interlocutory and that it lacked jurisdiction over such appeals. Aaron W. subsequently appealed the ICA's dismissal to the Supreme Court of Appeals of West Virginia.The Supreme Court of Appeals of West Virginia affirmed the ICA's dismissal, holding that the family court's disqualification order was not a final order because it did not terminate the litigation on the merits. The court explained that the ICA generally does not have appellate jurisdiction over interlocutory appeals, as specified by West Virginia Code § 51-11-4(d)(8). The court also noted that the family court's inclusion of finality language in its order did not transform the interlocutory order into a final, appealable order. Consequently, the ICA correctly dismissed the appeal for lack of jurisdiction. View "Aaron W. v. Evelyn W." on Justia Law

The petitioner, Rafael Antonio Mena Chavez, filed a lawsuit under the false name "Sergio Balboa" after sustaining injuries while working for Southern Recycling, LLC. Chavez used the alias to obtain employment and continued using it when seeking medical attention and workers' compensation benefits. He later filed a lawsuit against Metso Minerals Industries, Inc., alleging product liability and negligence. Southern Recycling and other intervenors joined the suit, claiming they had paid substantial workers' compensation benefits to "Sergio Balboa."The Orleans Civil District Court denied Metso's motion to dismiss the case, despite Metso's argument that Chavez's use of a false identity undermined the judicial process. The court found no fraud or willful deception at that stage and allowed the case to proceed. Metso's subsequent writ to the Louisiana Court of Appeal, Fourth Circuit, was also denied. Metso then sought relief from the Louisiana Supreme Court.The Louisiana Supreme Court reversed the lower courts' decisions, holding that courts have inherent authority to dismiss an action with prejudice when a petitioner’s conduct undermines the integrity of the judicial process. The court found that Chavez's prolonged use of a false identity was a calculated deception that harmed the judicial system and the defendants. The court dismissed Chavez's petition with prejudice and remanded the case to the trial court to determine whether the intervenors' petition survives the dismissal of Chavez's petition. View "CHAVEZ VS. METSO MINERALS INDUSTRIES, INC." on Justia Law

Philadelphia Indemnity Insurance Company (Philadelphia), a Pennsylvania-based insurer, brought claims of malpractice, indemnity, and contribution against Martin O’Leary, Kimberly Forrester, and the Sedgwick LLP Liquidating Trust (Sedgwick Defendants). The Sedgwick Defendants, former employees of the now-bankrupt Sedgwick LLP, had provided legal services to Philadelphia. The claims arose from a Montana class action lawsuit involving Gateway Hospitality, Inc. (Gateway), which Philadelphia had insured. Sedgwick advised Philadelphia to deny coverage to Gateway, leading to a settlement where Gateway paid approximately four million dollars to class members.The Fourth Judicial District Court in Missoula County granted the Sedgwick Defendants' Motion to Dismiss for Lack of Personal Jurisdiction. The court found that Philadelphia failed to establish that the Sedgwick Defendants had sufficient contacts with Montana to warrant jurisdiction. Philadelphia appealed this decision, arguing that the Sedgwick Defendants' actions related to the Montana lawsuit should subject them to Montana's jurisdiction.The Supreme Court of the State of Montana reviewed the case and affirmed the District Court's decision. The court held that the Sedgwick Defendants did not have sufficient contacts with Montana to establish personal jurisdiction. The Sedgwick Defendants' actions, including providing legal advice and sending a denial letter from California to Ohio, did not constitute transacting business or committing a tort in Montana. The court concluded that the Sedgwick Defendants' conduct did not create a substantial connection with Montana, and thus, the exercise of personal jurisdiction was not appropriate. View "Philadelphia Indemnity Insurance Co. v O'Leary" on Justia Law

An attorney, Brian Steel, was found in contempt of court for refusing to disclose how he learned about an ex parte hearing involving a witness, the witness's counsel, and prosecutors in a case where Steel represented a defendant. The trial judge, Judge Glanville, repeatedly asked Steel to reveal his source, but Steel claimed the information was protected by attorney-client privilege and attorney work product. Judge Glanville held Steel in contempt and ordered him into custody, although Steel was later allowed to return to the courtroom.The Fulton County Superior Court initially found Steel in contempt and ordered him to be taken into custody. Steel argued that the information was privileged and that due process required Judge Glanville to recuse himself from the contempt proceedings. Despite these arguments, Judge Glanville sentenced Steel to 20 days in jail to be served on weekends and denied him a supersedeas bond.The Supreme Court of Georgia reviewed the case and determined that due process required Judge Glanville to recuse himself from the contempt proceedings. The court held that because the punishment was delayed and the alleged disobedience was directed toward the judge, a different judge should have presided over the contempt hearing. The court reversed the judgment of contempt imposed by the trial court. View "STEEL v. THE STATE" on Justia Law

The plaintiffs, who operate restaurants under franchise agreements, filed a Chapter 11 bankruptcy petition based on advice from their legal counsel. This led to the franchisor terminating the franchise agreements. The plaintiffs then sued their lawyers and law firms for legal malpractice and breach of written contracts for legal services, alleging that the lawyers' advice constituted malpractice. The defendants moved to dismiss both claims, arguing they were barred by a four-year statute of limitation under OCGA § 9-3-25.The trial court dismissed the legal-malpractice claims but denied the motion to dismiss the breach-of-contract claims. Later, it granted summary judgment for a subset of defendants, ruling that the breach-of-contract claims were also barred by the four-year statute of limitation. The Court of Appeals affirmed the dismissal of the legal-malpractice claims and concluded that the breach-of-contract claims were duplicative and should be dismissed as well.The Supreme Court of Georgia reviewed the case to determine which statute of limitation applies to breach-of-contract-for-legal-services claims and whether the Court of Appeals erred in dismissing these claims as duplicative. The Supreme Court concluded that such claims could be governed by either a six-year statute of limitation under OCGA § 9-3-24 or a four-year statute under OCGA § 9-3-25, depending on whether the breach arose directly from a written contract. The Court also held that the Court of Appeals erred in dismissing the breach-of-contract claims as duplicative without applying the proper motion-to-dismiss standard.The Supreme Court vacated the Court of Appeals' judgment and remanded the case for further proceedings consistent with its opinion, emphasizing that plaintiffs can pursue alternative theories of relief based on the same conduct. View "TITSHAW v. GEER" on Justia Law