Tuesday, November 1, 2016
The California State Bar Court Review Department has recommended a 30-day suspension and probation for misconduct in a fee request made by an attorney who brought a class action against Toshiba.
This matter was referred to the State Bar by the Second District Court of Appeal (Court of Appeal) in a 34-page published opinion upholding a superior court sanction order against Lori Jo Sklar for misuse of discovery. (Ellis v. Toshiba America Information Systems, Inc. (2013) 218 Cal.App.4th 853, 890 (Ellis).) Based on the civil court findings and the corroborating testimony and evidence introduced in these proceedings, a hearing judge found Sklar culpable of seeking to mislead a judge and failing to obey court orders.
On February 9, 2005, Caddell & Chapman (C&C), a Texas law firm, and Sklar, a solo practitioner doing business as Sklar Law Offices (SLO), filed a class action lawsuit against Toshiba America Information Systems, Inc. (Toshiba) on behalf of consumers who purchased Toshiba laptop computers that developed an electrostatic discharge problem in their covers. Basically, the laptops would malfunction and shut down. The parties reached a tentative settlement on the merits phase of the case nine months after the complaint was filed. The superior court granted preliminary approval of that settlement in October 2006 and final approval in May 2007.
Germane to this proceeding is the attorney fees aspect of the case, which lasted for over a decade and was ongoing as of the date of the disciplinary trial in this matter.
Between August 2006 and April 2009, Sklar made repeated representations to the superior court that she was seeking between $22 and $24 million in attorney fees...
Protracted discovery disputes followed Sklar’s initial $24 million fee request in 2006. Faced with a fee request for what it called a “staggering” amount of money, the superior court permitted Toshiba to conduct discovery pertaining to the amount of time Sklar actually worked on the matter, and ordered Sklar to produce electronic time records in “native format.”
Sklar produced hard copies of her time records and Microsoft Word files of the records, but not electronic, searchable copies in their “native form” with associated metadata, as sought by Toshiba. Sklar claimed those records no longer existed because she used a program called “Wipe and Delete” to scrub her computer daily and eliminate metadata.
In June 2007, Toshiba filed a motion for sanctions, alleging that Sklar had deleted or destroyed responsive records. On August 15, 2007, Sklar appeared at a hearing on Toshiba’s motion when the judge ruled from the bench. The judge declined to order sanctions for spoliation of evidence; instead, he ordered the parties to select a neutral expert to, within 30 days after being selected, conduct a search of Sklar’s computer backup files and produce anything that was not privileged. The judge’s oral ruling was confirmed in an August 15, 2007 minute order.
The attorney made misrepresentations to the judge and disobeyed court orders
We also agree with the hearing judge’s section 6103 culpability finding. As the Court of Appeal stated, “there is no question” that Sklar disobeyed the superior court’s August 15, 2007 and June 24, 2008 orders regarding the inspection of her computer. Sklar admits she intentionally did not allow the inspection, but raises a host of arguments as justification. She primarily claims the judge’s orders were never properly signed or served, and no protocols were in place to protect confidential/privileged information. Like the superior court, the Court of Appeal, and the hearing judge, we find no merit to these arguments,,,
The State Bar Court rejected a variety of evidentiary challenges and a delay claim
Sklar’s fee litigation in Ellis began in 2006 and was ongoing as of the date of trial in this matter. The Court of Appeal referred Sklar’s misconduct to the State Bar in August 2013, OCTC filed the NDC on December 22, 2014, and trial commenced seven months later in August 2015. A two-year period from referral to trial is not excessive; cases recognizing undue delay involve much longer periods of time.