Tuesday, April 4, 2017
The New York Court of Appeals (per Judge Stein) has issued a decision declining a merits review of Facebook's failed motions in response to a criminal investigation
In this matter, we are asked to determine the appealability of two Supreme Court orders. The first order denied Facebook, Inc.'s motion to quash certain warrants, issued pursuant to the federal Stored Communications Act, that sought the account information and communications of various Facebook subscribers in connection with a criminal investigation. The second order denied Facebook's motion to compel disclosure of the affidavit supporting the warrant application.
This case undoubtedly implicates novel and important substantive issues regarding the constitutional rights of privacy and freedom from unreasonable search and seizure, and the parameters of a federal statute establishing methods by which the government may obtain certain types of information. Nevertheless, while it may be tempting for this Court to address those issues, we must -- in this case as in every other case -- first ascertain whether we possess the necessary jurisdiction to do so under our own constitution and statutes. This presents equally important issues regarding the separation of powers among our three branches of government. With these principles in mind, because the orders resolving Facebook's motions relate to warrants issued in a criminal proceeding, and the Criminal Procedure Law does not authorize an appeal from either order, we are constrained by law to affirm the Appellate Division order dismissing Facebook's appeals to that Court.
Judge Rivera concurred
I concur with the majority that the order denying Facebook's motion to quash the warrant is not appealable, but on the narrower basis that Facebook did not assert the grounds provided for under 18 USC § 2703 (d), and, thus, pursuant to section 2703 (a), the order is subject to our state rules and unreviewable. However, I fully agree with and adopt my dissenting colleague's comprehensive and well-reasoned analysis that the Stored Communications Act permits Facebook to appeal the denial of a motion to quash or modify the SCA warrants (dissenting op at §§ I[a], III[a]).
Judge Wilson dissented
The Fourth Amendment to the U.S. Constitution, urged on the nation by the New York ratifying convention in 1788 (William J. Cuddihy, The Fourth Amendment: Origins and Original Meaning, 602- 1791, 695 [1st ed 2009]), secures us against unreasonable searches and seizures by our government. It reflects the American consensus that the general warrants and writs of assistance popular among British officials in colonial government -- orders that licensed their possessors to scour homes and businesses for anything of potential interest to the Crown, and that were a significant provocation to the revolutionary sentiment then taking hold in New England -- had no place in a nascent republic that so deeply abhorred arbitrary power...
Constitutional and Congressional words of promise were given to our ear, and I would not break them to our hope. I respectfully dissent, and would remand this case to the Appellate Division to resolve the motion to quash or modify the warrants, as well as the pendant matters involving the permissibility of an indefinite gag order and the disclosure of the underlying affidavit. As one of the delegates to the 1938 convention urged his fellow representatives, "let us decide this thing on the merits" (Revised Record at 462).
Thursday, March 30, 2017
The New York Appellate Division for the First Judicial Department reversed an order giving access to records of the officer who caused the death of Eric Garner.
The issues before us stem from the extensively publicized arrest and death of Eric Garner on July 17, 2014. Intervenor Police Officer Daniel Pantaleo was depicted in a bystander video applying a choke hold to Mr. Garner during the incident. An investigation followed, and on December 2, 2014, a grand jury declined to indict Officer Pantaleo in connection with Mr. Garner's death.
Petitioner submitted a Freedom of Information Law (FOIL) letter request to respondent Records Access Officer, Civilian Complaint Review Board (CCRB), dated December 18, 2014, seeking eight categories of records concerning Officer Pantaleo, dating from 2004 to the date of Mr. Garner's death. Petitioner sought: (1) the number of complaints filed against Officer Pantaleo; (2) the number of allegations contained within each complaint; (3) the outcome of CCRB's investigation of each allegation; (4) any prosecution by CCRB in response to such finding; (5) the outcome of any prosecution by CCRB; (6) any charges and specifications filed by the New York City Police Department's (NYPD) Department Advocate Office; (7) the outcome of any Department Advocate Office proceedings; and (8) any other agency actions in response to the above requests.
On December 24, 2014, CCRB denied the request, citing the statutory exemption from disclosure provided for police personnel records contained in Public Officers Law § 87(2)(a) and Civil Rights Law § 50-a. In addition to the statutory exemptions, CCRB noted that the request for records relating to unsubstantiated matters would constitute "an unreasonable invasion of privacy." Finally, CCRB noted that it was not possible to redact any responsive records "in a way that will disassociate allegations against [Officer Pantaleo] given the nature of" petitioner's request. Petitioner appealed to the CCRB on December 29, 2014, but received no response.
This article 78 proceeding was commenced on February 17, 2015, and sought an order directing the CCRB to produce "a summary of the number of allegations, complaints and outcomes brought against" Officer Pantaleo. Much of petitioner's broader initial request was thus abandoned. During the proceedings, petitioner further narrowed its FOIL request, seeking only information as to "whether the CCRB substantiated complaints against Officer Pantaleo and, if so, whether there were any related administrative proceedings, and those outcomes, if any." Officer Pantaleo applied for and was granted intervenor status as a party respondent. His opposition papers alleged, among other things, that even the requested summary of the CCRB records was exempt from disclosure because it would endanger his life and the lives of his family members. In support, he referenced online, unsubstantiated reports of alleged misconduct on his part that resulted in the arrest of a Michigan man in February 2015 for posting Facebook death threats against him. Officer Pantaleo also stated that the NYPD's Threat Assessment Unit had assigned police officers to watch over him and his family 24 hours a day, 7 days a week, and implemented other security measures as well. He also agreed with the CCRB that the requested documents constituted "personnel records" within the meaning of Civil Rights Law § 50-a(1) and were therefore exempt from disclosure.
Here, in light of the widespread notoriety of Mr. Garner's death and Officer Pantaleo's role therein, and the fact that hostility and threats against Officer Pantaleo have been significant enough to cause NYPD's Threat Assessment Unit to order around-the-clock police protection for him and his family, and notwithstanding the uncertainty of further harassment, we find that the gravity of the threats to Officer Pantaleo's safety nonetheless demonstrate that disclosure carries a "substantial and realistic potential" for harm, particularly in the form of "harassment and reprisals," and that nondisclosure of the requested records under Civil Rights Law § 50-a is warranted (see Daily Gazette, 93 NY2d at 157, 159).
The points raised in the various amici briefs can be summarized, in the main, as raising various public policy concerns. However, with all due respect to the seriousness of those concerns, we take no position on whether the statute should be amended to address those concerns. We are bound to apply the law as it exists, and as interpreted by controlling Court of Appeals precedents (Matter of New York Civil Liberties Union v New York City Police Dept., __ AD3d __ [1st Dept 2017]). Such policy and public interest arguments have been found to be inconsistent with the legislative history of Civil Rights Law § 50-a (see Daily Gazette, 93 NY2d at 154-155). Petitioner's remedies, under our tripartite system of government, rest with the Legislature as the policy making branch of government, not the courts, which are tasked with interpretation of the laws.
...the order and judgment (one paper), of the Supreme Court, New York County (Alice Schlesinger, J.), entered July 27, 2015, directing respondent to produce to petitioner, pursuant to the Freedom of Information Law (FOIL), a summary of CCRB's records indicating (a) the number of substantiated complaints brought against intervenor before the July 17, 2014 death of Eric Garner and (b) any CCRB recommendations made to the Police Department based on such complaints, should be reversed, on the law, without costs, the judgment vacated, the petition denied, and the proceeding brought pursuant to CPLR article 78 dismissed.
Tuesday, March 21, 2017
An opinion of the North Carolina Court of Appeals affirms a disqualification order based on the witness-advocate rule.
This case presents the question of whether a categorical exception to the applicability of Rule 3.7 of the North Carolina Rules of Professional Conduct exists in fee collection cases. Harris & Hilton, P.A. (“Harris & Hilton”) appeals from the trial court’s order disqualifying Nelson G. Harris (“Mr. Harris”) and David N. Hilton (“Mr. Hilton”) from appearing as trial counsel in this action based on their status as necessary witnesses. Because this Court lacks the authority to create a new exception to Rule 3.7, we affirm the trial court’s order.
On 10 June 2015, Harris & Hilton filed the present action in Wake County District Court against James C. Rassette (“Defendant”) to recover attorneys’ fees for legal services the firm had allegedly provided to Defendant prior to that date. The complaint asserted that Harris & Hilton was entitled to recover $16,935.69 in unpaid legal fees. On 13 November 2015, Defendant filed an answer in which he asserted various defenses, including an assertion that no contract had ever existed between the parties.
On 10 June 2016, a pre-trial conference was held before the Honorable Debra S. Sasser. During the conference, Judge Sasser expressed a concern about the fact that Harris & Hilton’s trial attorneys — Mr. Harris and Mr. Hilton — were also listed as witnesses who would testify at trial on behalf of Harris & Hilton. After determining that Mr. Harris and Mr. Hilton were, in fact, necessary witnesses who would be testifying regarding disputed issues such as whether a contract had actually been formed, Judge Sasser entered an order on 20 June 2016 disqualifying the two attorneys from representing Harris & Hilton at trial pursuant to Rule 3.7. On 27 June 2016, Harris & Hilton filed a notice of appeal to this Court.
Harris & Hilton does not dispute the fact that (1) Mr. Harris and Mr. Hilton will both be necessary witnesses at trial; (2) their testimony will encompass material, disputed issues; and (3) none of the three above-quoted exceptions contained within Rule 3.7 are applicable. Nor does it contest the fact that a literal reading of Rule 3.7 supports the trial court’s ruling. Instead, it asks this Court to adopt a new exception based on its contention that Rule 3.7 should not be applied in fee collection actions to disqualify counsel from both representing their own firm and testifying on its behalf.
Harris & Hilton argues that permitting a law firm’s attorney to serve both as trial counsel and as a witness in a fee collection case is no different than allowing litigants to represent themselves pro se. It is true that litigants are permitted under North Carolina law to appear pro se — regardless of whether the litigant is an attorney or a layperson. See N.C. Gen. Stat. § 1-11 (2015) (“A party may appear either in person or by attorney in actions or proceedings in which he is interested.”); N.C. Gen. Stat. § 84-4 (2015) (“[I]t shall be unlawful for any person or association of persons, except active members of the Bar . . . to practice as attorneys-at-law, to appear as attorney or counselor at law in any action or proceeding before any judicial body . . . except in his own behalf as a party thereto[.]” (emphasis added)).
However, the present case does not involve the ability of Mr. Harris or Mr. Hilton to represent themselves on a pro se basis. Instead, they seek to represent their law firm — a professional corporation — in a suit against a third party while simultaneously serving as witnesses on their firm’s behalf as to disputed issues of fact. It is well established that an entity such as Harris & Hilton is treated differently under North Carolina law than a pro se litigant. See LexisNexis, Div. of Reed Elsevier, Inc. v. Travishan Corp., 155 N.C. App. 205, 209, 573 S.E.2d 547, 549 (2002) (holding that under North Carolina law, a corporation is not permitted to represent itself pro se).
Harris & Hilton also makes a policy argument, contending that the current version of Rule 3.7 is archaic and fails to take into account the disproportionate economic burden on small law firms that are forced to hire outside counsel to litigate fee collection cases. However, in making this argument, Harris & Hilton misunderstands the role of this Court given that it is asking us not to interpret Rule 3.7 but rather to rewrite it — a power that we simply do not possess.
we cannot say that the trial court abused its discretion by applying Rule 3.7 as written as opposed to creating a new exception that neither appears within the Rule itself nor has been recognized by North Carolina’s appellate courts. Accordingly, we affirm the trial court’s disqualification order.
Tuesday, March 14, 2017
The United States Court of Appeals for the District of Columbia Circuit affirmed dismissal of a claim brought by an attorney against the Department of State.
The plaintiff is a law firm that advises clients on U.S. law that regulates the international arms trade. Concerned that the State Department might enforce arms-control regulations against it in a way that would force disclosure of confidential client information, the law firm seeks declaratory and injunctive relief. The district court dismissed the action for lack of standing and ripeness. We affirm on the ground that the plaintiff lacks standing to bring a preenforcement challenge because it faces no credible threat of enforcement.
Matthew A. Goldstein is the principal attorney in a law firm that bears his name and specializes in providing legal advice to clients involved in transactions subject to the [International Traffic in Arms Regulation Act] . Goldstein attests that his firm “regularly represents clients in the preparation of the terms and conditions of sale, user agreements, vendor certifications, and other legal documents” for ITAR-related transactions. J.A. 51-52. According to Goldstein, his firm’s clients often have not identified the foreign parties that will be involved in prospective transactions at the time the firm provides its legal advice.
Soon after the State Department promulgated its 2013 regulation explicitly excluding legal services from the ITAR’s definition of brokering activities, Goldstein sought an advisory opinion from the Department pursuant to 22 C.F.R. § 126.9(a), asking whether six categories of services his firm provides were regulated or exempt. These services include advising clients on how to structure sales of defense articles, preparing sales contracts for these items, drafting technical-assistance agreements, advising on the availability of financing, advising on and preparing sales proposals, and corresponding and meeting with U.S. government officials. However, Goldstein offered the State Department no details about any past or contemplated transactions.
Goldstein asserts that, nearly a year after he requested an advisory opinion, the head of compliance at the State Department called him to say that the services described in his request would not be subject to Part 129 so long as his clients did not pay his firm a contingency fee or a commission. Relying on this advice, Goldstein withdrew his request. The State Department responded with a letter, advising Goldstein that his initial request and the phone conversation “lacked sufficient detail for the Department to make an official determination as to whether the activities discussed constituted brokering activities.” J.A. 36 (emphasis added). The letter also referred him to the Frequently Asked Questions page on the State Department’s website.
The attorney's subsequent suit was dismissed on standing grounds.
The question before us is whether the law firm has standing to seek to enjoin the State Department from enforcing its regulations governing arms brokering. The firm has failed, however, to demonstrate its standing to seek pre-enforcement relief: it has not “suffered an ‘injury in fact’ that is (a) concrete and particularized and (b) actual or imminent . . . .” Sabre, Inc. v. U.S. Dep’t of Transp., 429 F.3d 1113, 1117 (D.C. Cir. 2005) (quoting Friends of the Earth, Inc. v. Laidlaw Envtl. Servs., Inc., 528 U.S. 167, 180-81 (2000)). It is true that a plaintiff is not required “to expose himself to liability before bringing suit to challenge the basis” for an enforcement action by the government...
But here, we have no facts from which to conclude that the law firm risks incurring any liability by failing to register with the State Department. Indeed, Goldstein offers only vague and general descriptions of legal activities that the firm intends to undertake, none of which the State Department views as brokering, as the Department has made abundantly clear on its website and, more particularly, at oral argument before this court. Unsurprisingly, then, the State Department has shown no intention of enforcing the brokering regulations against Goldstein’s law firm...
As long as the firm merely provides the legal services Goldstein describes, it faces no material risk of enforcement from the State Department. His firm therefore need not fear that it will have to disclose confidential client information or otherwise take steps to register.
Circuit Judge Griffith authored the opinion. (Mike Frisch)
Saturday, March 11, 2017
Friday, March 10, 2017
A memorandum opinion issued by Judge John Bates of the United States District Court for the District of Columbia denies a defendant attorney's motion to dismiss and addresses an unresolved issue of D.C. law with respect to fee-sharing agreements with non-attorneys
Allan Gerson, the defendant and an attorney, contracted with Zvi Shtauber, the plaintiff, for Shtauber to provide services to assist Gerson in a lawsuit. Their contract specified a fee-sharing arrangement, where Gerson would share with Shtauber a portion of any contingency fee he earned from the lawsuit. Shtauber alleges that Gerson failed to pay, and now sues for enforcement of that contract, or alternatively for recovery in quantum meruit, and for a declaratory judgment that he is entitled to a portion of Gerson’s fees in the future. Gerson moves to dismiss, arguing that the contract is unenforceable as contrary to public policy because a fee-sharing contract between a lawyer and a non lawyer violates the D.C. Rules of Professional Conduct, and that Shtauber cannot pursue a claim for quantum meruit when there is a contract between the parties. The Court will deny Gerson’s motion.
The court notes that many facts were not in dispute
In 2004, Gerson explored the possibility of suing Arab Bank and other financial institutions “on behalf of victims of genocide and terrorism in Israel and in territories administered by the Palestinian Authority.” Id. Gerson hired Shtauber to assist in the lawsuit. Id. ¶ 6. Shtauber, a resident of Israel, has experience in relevant fields of national security and has served as both the Foreign Policy Advisor to the Israeli Prime Minister and as Israel’s Ambassador to the United Kingdom. Id. Shtauber connected Gerson to an Israeli attorney, David Mena, to help litigate the case against Arab Bank, and provided additional “consulting services” in connection with Gerson’s suit. Id. ¶ 7.
As to fee sharing
Gerson argues that the fee sharing arrangement is forbidden by the D.C. Rules of Professional Conduct (“Rules”) in effect at the time, and therefore is unenforceable as against public policy. Shtauber responds that the Agreement is not contrary to the Rules, but even if it is, it’s still enforceable.
The Agreement was signed in 2005. At the time, Rule 5.4(a) of the D.C. Rules of Professional Conduct stated: “A lawyer or law firm shall not share legal fees with a nonlawyer” and then provided four exceptions. See also D.C. Code § 11-2501 (attorneys admitted to the D.C. bar are subject to the Rules). The first two exceptions concern payments to an attorney’s estate after death. The third exception states a “lawyer or law firm may include nonlawyer employees in a compensation or retirement plan, even though the plan is based in whole or in part on a profit sharing arrangement.” Rule 5.4(a)(3). The fourth states that fee sharing “is permitted in a partnership or other form of organization” that meets specified requirements, as laid out in Rule 5.4(b), for a nonlawyer to exercise managerial authority over the firm or have a financial interest in the firm. Id. 5.4(a)(4)...
Rule 5.4(a) clearly prohibits the fee sharing arrangement described here. The Agreement between Shtauber and Gerson states that “Dr. Shtauber’s fees under this Agreement shall be 20% of any and all contingent legal fees” due to the Gerson Group for claimants referred to them by Mena. Agreement ¶ 4. In addition to this arrangement being forbidden by the plain language of Rule 5.4(a), the D.C. Bar has issued an ethics opinion explicitly stating that “[a] payment by a lawyer to another person for the referral of legal business, which is contingent on the lawyer’s receipt of fees from the referred legal business and is tied to the amount of those fees” constitutes fee sharing that is prohibited by Rule 5.4(a). See D.C. Legal Ethics Op. 286 (1998). This does not describe the exact situation here: Shtauber is not being paid directly for referring clients, rather he is being paid a contingent fee with respect to clients referred to Gerson by another attorney, Mena. Nonetheless, Shtauber is being paid “for the referral of legal business” (through an intermediary) that is “contingent on [Gerson’s] receipt of fees from the referred legal business and is tied to the amount of those fees.” Thus the Agreement is likely covered by Ethics Opinion 286, in addition to being forbidden by the plain language Rule 5.4(a).
But the agreement is enforceable
This case raises an open question of District of Columbia law. In light of existing D.C. Court of Appeals precedent, this Court believes that although the Agreement violates the D.C. Rules of Professional Conduct, it is nonetheless enforceable in this particular instance. Moreover Shtauber may seek recovery in quantum meruit as an alternative to damages on the contract.
The Bar ethics opinion cited is linked here. (Mike Frisch)
Monday, March 6, 2017
The Delaware Court of Chancery has held that a former corporate officer is entitled to indemnification and legal fees in litigation involving his company
The Company opposes Horne’s demand for indemnification. Specifically, the Company contends that certain of the claims in the underlying litigation did not arise by reason of Horne’s service as an officer of the Company and also that certain of the fees charged by Horne’s counsel are unreasonable. Horne disagrees and seeks summary judgment on his claims for: (i) fees and expenses incurred in successfully defending the underlying litigation, (ii) fees and expenses incurred prosecuting this action, and (iii) pre- and post-judgment interest on all amounts. For the reasons that follow, the motion is GRANTED.
The sordid factual background that gave rise to the underlying litigation was described in considerable detail in the Trial Opinion. My focus here is on the facts necessary to inform the indemnification analysis. In September 2012, a Company employee [Geller] reported to Waite that she and Morelli had engaged in a sexual relationship over a period of time and that she believed Morelli had sexually harassed her. This report prompted a series of responses from Horne and the Director Defendants that ultimately led to Morelli’s removal as CEO. In the underlying litigation, Morelli contended that the defendants had been looking to remove him for years and that the reported sexual misconduct with an employee was merely a pretext to allow the defendants to seize to control of the Company. He alleged that the defendants bribed and coaxed the female employee to make a false claim of sexual harassment as the first step of their plan and then initiated a bogus investigation of the report to provide cover for the challenge they knew would follow his removal as CEO.
In the Trial Opinion, the Court summarized Horne’s very limited involvement in the sexual harassment investigation and subsequent attempt to remove Morelli as CEO. In essence, Horne gave statements to lawyers charged with leading the investigation and pointed out to the lawyers that a stockholders agreement would have to be amended if the Board decided to remove Morelli in order to prevent Morelli from simply replacing the majority of directors as controlling stockholder and then reinstating himself as CEO. When the Board met to consider Morelli’s removal, Horne was not present and did not otherwise participate.
Morelli sued Horne and others
While the Morelli Complaint named Horne in several counts, the claims actually presented against Horne during the six-day trial were much more limited. Indeed, the trial court recounted how the Plaintiffs had either abandoned or waived nine of the claims they alleged in the Morelli Complaint. As to Horne, the court noted that the primary claim prosecuted against him at trial was that he aided and abetted the Director Defendants in their alleged breaches of fiduciary duty. The Trial Opinion characterized the Plaintiffs’ claims as “a shifting target and impossible to defend against without enormous expense” and rejected each claim against against Horne out of hand.
Horne then sued for indemnification and his legal expenses
When determining whether fees are reasonable under Section 145(c), the court considers whether: (1) the expenses were actually paid or incurred, (2) the services were in good faith thought prudent and appropriate by competent counsel, and (3) the rates or charges were comparable to those charged in similar circumstances. The Company does not dispute that Horne incurred fees. Nor does the Company challenge the rates charged by Horne’s counsel. Instead, the Company challenges certain strategic decisions made by Horne’s counsel during the underlying litigation, including the decision to rely upon a witness declaration that was later deemed to be unreliable and the decision to depose a witness who Defendant alleges did not provide relevant testimony, both of which Defendant alleges “were the product of meritless litigation strategies that Horne abandoned prior to trial, but not before racking up considerable expense.” The Company’s invitation to nitpick counsel’s strategic decisions in this hotly litigated case where Horne ultimately prevailed on every claim is offered with little grace.
This court will review litigation strategy decisions only if they are “unmistakably unreasonable” and constitute “clear abuse.” The Company has fallen well short of making this showing. Nor has the Company justified its requests for discovery into the fees or that the Court engage in a line-by-line review of counsel’s bill. Given the complexity of the issues, the duration and scope of discovery, the extensive pre-trial motion practice and the lengths to which Horne was forced to go to defend himself—at trial and post-trial appeal—it is clear that the requested fees are reasonable on their face.
The earlier opinion is linked here.
In this action, the CEO and the company return to this Court alleging that the four defendants engaged in a long-running and wide-ranging conspiracy that involved, essentially, everyone who disagreed with the CEO‘s management of the company. The plaintiffs seek approximately $50 million in damages, as well as equitable relief in the form of an extension of the stockholders agreement in order to cement the CEO‘s control for another two years. The alleged wrongs range from nebulous breaches of fiduciary duty based on undermining the company‘s strategic vision to breach of contract claims. After extensive pre-trial proceedings, I tried this matter for six days in February 2015. This Memorandum Opinion ("Opinion") reflects my post-trial findings of fact and conclusions of law, as well as my rulings on certain ancillary motions. Because of the far-ranging claims advanced by the plaintiffs and the number of non-party actors who figure in their narrative, the recitation of the facts is unusually lengthy.
Overall, the plaintiffs seek damages and equitable relief for breach of the duty of loyalty, breach of contract, and tortious interference, and they advance secondary liability theories of aiding and abetting and conspiracy. The defendants deny liability on all counts, argue that there was and is no conspiracy, and contend that the CEO is a paranoid narcissist. The defendants also accuse the plaintiffs of having undermined the integrity of the litigation process by engaging in conduct akin to bribing and tampering with witnesses.
The court found that the plaintiffs engaged in serious litigation misconduct
I recognize that parties have a right to vigorously pursue their claims. I also assume that, misguided as I consider it to be, Morelli and his counsel believe their rhetoric regarding a vast conspiracy to take control of Optimis away from Morelli for the alleged insurgents‘ own self-serving motives. But, even so, the conduct I have described here is beyond the pale. Specifically, I find that Plaintiffs‘ conduct was "prejudicial to the administration of justice" and has undermined the integrity of these proceedings by materially impacting the Court‘s ability reliably and accurately to find the facts. The crucial allegation underlying Plaintiffs‘ breach of loyalty claims is that Defendants used Geller as a pretext to take over the Company. When deposed, she demolished the reliability of the key statements in the Final Geller Declaration that might support a finding that Defendants engaged in a takeover conspiracy and used Geller‘s sexual harassment claims as a pretext. I, therefore, find it appropriate to disregard, in their entirety, all of the documents in the Geller Settlement and to reject any attempt by Plaintiffs to use those documents affirmatively to impeach Geller or any other witness. Relying on those documents is impossible based on the cynical context and manner in which they were created. As a result of Plaintiffs‘ improper conduct, I instead find credible and reliable what Geller said at her deposition and resolve any doubts about her credibility in favor of Defendants.
Forward Forensics reported on issues of corporate governance at the company. (Mike Frisch)
Tuesday, February 28, 2017
A majority of the Wisconsin Supreme Court overruled precedent and reversed the Court of Appeals in order to deny an application to test DNA evidence for exoneration purposes.
The defendant was convicted of murder in 1982 and sentenced to life in prison.
Justice Zeigler for the majority
We conclude that the circuit court did not err in denying Denny's postconviction motion for forensic DNA testing of certain evidence. Consequently, we reverse the decision of the court of appeals.
Chief Justice Roggensack concurred and dissented
Although the majority opinion correctly overrules Moran's interpretation of Wis. Stat. § 974.07(6), in which portion of the opinion I concur and join, I dissent from the part of the majority opinion that concludes that Jeffrey Denny is not entitled to DNA testing of evidence collected at the crime scene. I conclude that Denny met the statutory requirements of Wis. Stat. § 974.07(7)(a); and therefore, the circuit court was required to grant Denny's motion for forensic DNA testing. Accordingly, I respectfully concur in part and dissent in part with, and from, the majority opinion.
Justice Ann Walsh Bradley dissented
[The majority] now overrules Moran and runs roughshod over the fundamental doctrine of stare decisis. To justify overturning unanimous precedent, the majority unearths a heretofore unknown test which it labels "principles of policy." Majority op., ¶71. Apparently not very convinced of the legitimacy of its own discovery, the majority obscures the application of the new test by tucking it away in a footnote. Id., ¶70 n.16.
In overruling Moran, not only does the majority apply a test that courts have never before used, it also attempts to justify its action by relying on an "imagine[d]" purpose that the legislature never stated. Garnering a trifecta of "nevers," it then embarks upon rewriting the plain meaning of Wis. Stat. § 974.07 by inserting a limitation that the legislature never created...
The rights and interests of crime victims are undeniably important considerations, which the legislature has already addressed through the notice provisions in Wis. Stat.§ 974.07(4). However, relying on an "imagined" policy reason to limit the availability of DNA testing strays too far from subsection (4)'s victim-notification mandate. See State ex rel. Kalal v. Cir. Ct. for Dane Cty., 2004 WI 58, ¶48, 271 Wis. 2d 633, 681 N.W.2d 110. There is nothing in the text of the statute that suggests the legislature intended to limit post-conviction DNA testing due to the speculative concerns the majority identifies here.
Contrary to the majority's assertions, allowing DNA testing does not undermine finality or lead to "the possibility of 'inequitable results'" due to "open[ing] up cases that have long been thought by everyone, including crime victims, to be final." Majority op., ¶70 n.16 (citation omitted). Performing DNA testing on relevant evidence is only the first step in a process where the defendant must next demonstrate that the results of the testing support his claim. See Moran, 284 Wis. 2d 24, ¶47 (allowing DNA testing does not guarantee a new trial or even an evidentiary hearing).
If the DNA test results do not support a defendant's claim, the case is not reopened. And if the DNA testing results do support a defendant's claim of innocence, victims will have little interest in finality if the true criminal perpetrator is still at large. See majority op., ¶70 n.16...
Contrary to the majority, I would adhere to this court's unanimous decision in Moran. The plain meaning of Wis. Stat. § 974.07(6) gives the defendant the right to test, at his own expense, evidence containing biological material that is relevant to the investigation or prosecution that resulted in his conviction. Additionally, the majority errs when it denies Denny the opportunity to test potentially exculpatory evidence by failing to acknowledge how the witness testimony could be undermined by exonerating DNA-evidence.
Justice Abrahamson joined the dissent and wrote separately to raise procedural issues with the majority opinion.
Dare to Think has a post about the underlying criminal case and the potential value of the DNA evidence. (Mike Frisch)
Saturday, February 25, 2017
The South Carolina Supreme Court held that certain activities of a management business violated proscriptions against the unauthorized practice of law.
The Court accepted this declaratory judgment action in our original jurisdiction to determine whether Community Management Group, LLC; its president, Stephen Peck; and its employee, Tom Moore, engaged in the unauthorized practice of law while managing homeowners' associations. We find Community Management Group engaged in the unauthorized practice of law...
We find Community Management Group engaged in the unauthorized practice of law when it (A) represented associations in magistrate's court, (B) filed judgments in circuit court, (C) prepared and recorded liens, and (D) advertised that it could perform the services we now clarify constitute the unauthorized practice of law.
Rogers Townsend asks that we permanently enjoin Community Management Group from any actions we find were the unauthorized practice of law. An injunction is a drastic remedy, which courts should apply with caution. Hampton v. Haley, 403 S.C. 395, 409, 743 S.E.2d 258, 265 (2013). An injunction should be issued only "where no adequate remedy exists at law." Id. After we issued the temporary injunction, Community Management Group stopped representing associations in magistrate's court, filing judgments in circuit court, and preparing and recording liens without an attorney. Additionally, Peck testified Community Management Group has no interest in resuming these activities. We decline to issue a permanent injunction in this situation.
Friday, February 24, 2017
A majority of the Wisconsin Supreme Court reversed the unanimous Court of Appeals and denied access to immigration detainer records sought from Fox News' favorite sheriff David Clarke.
We conclude that I-247 forms are statutorily exempt from disclosure according to the terms of Wisconsin public records law, and therefore, we need not reach common-law exemptions or the public interest balancing test. Stated more fully, under Wis. Stat. §§ 19.36(1)-(2),3 any record specifically exempted from disclosure pursuant to federal law also is exempt from disclosure under Wisconsin law. Federal regulation 8 C.F.R. § 236.6 (2013) precludes release of any information pertaining to individuals detained in a state or local facility and I-247 forms contain only such information.
There is a dissent from Justicxe Ann Walsh Bradley
Wisconsin's Public Records Law "serves one of the basic tenets of our democratic system by providing an opportunity for public oversight of the workings of government." Majority op., ¶17 (citations omitted). Relying on this basic tenet, Voces de la Frontera requests unredacted copies of federal immigration detainer forms issued to Milwaukee County Sheriff David Clarke by Immigration and Customs Enforcement ("ICE").
The circuit court determined that Wisconsin's Public Records Law requires the release of unredacted copies of the detainer forms. It explained that Voces de la Frontera made a compelling case and that Sheriff Clarke offered no good reason to justify any redaction.
The court of appeals affirmed. Noting uncontested facts, it rejected Sheriff Clarke's newly raised argument that an obscure federal regulation, 8 C.F.R. § 236.6, precluded release of the detainer forms
Sheriff Clarke now contends that no detainer forms should be released. He asserts that the forms are statutorily exempt from disclosure and that his office erred when it previously released redacted detainer forms to Voces.
Reneging on previously uncontested facts and relying on a belatedly cited obscure federal regulation——never before applied to state or local detainees——Sheriff Clarke tosses a "hail mary" pass to the Wisconsin Supreme Court.
The majority catches the pass and runs with it, but unfortunately makes no forward progress for the people of this state. Instead, a majority of this court loses ground, yet again chipping away at Wisconsin's long-standing commitment to open government. See, e.g., Democratic Party of Wisconsin v. Wisconsin Dep't of Justice, 2016 WI 100, 372 Wis. 2d 460, 888 N.W.2d 584.
Once more a majority of this court reverses a unanimous court of appeals decision affirming a circuit court order requiring the release of records to the public, further undermining the principle that Wisconsin Public Records Law be construed "in every instance with a presumption of complete public access." Wis. Stat. § 19.31.
This time the majority rewrites a federal regulation by deleting the phrase "on behalf of the Service" from the regulatory language in order to reach its conclusion that yet another public records request must fail. Given the cumulative effect of the majority's approach, one wonders if a day will come when we awake to find that this continuous "chipping away" has substantially gutted Wisconsin's commitment to open government.
Contrary to the majority, I agree with the circuit court that Clark offers no good reason to counter the strong presumption of open access to these public records. I likewise agree with the unanimous court of appeals that the federal regulation does not statutorily exempt immigration detainer forms from release under Wisconsin's Public Records Law. Both the plain language of the federal regulation and its promulgation history establish that it applies only to detainees in the custody of the federal government.
Accordingly, I respectfully dissent
Justice Abrahamson joined the dissent. (Mike Frisch)
Thursday, February 23, 2017
The dismissal of a lawsuit against a church was affirmed by the Oklahoma Supreme Court
This appeal originates from a lawsuit filed by Plaintiff/Appellant John Doe (a pseudonym for Plaintiff) (hereinafter, "Appellant") against Defendants/Appellees The First Presbyterian Church of U.S.A. of Tulsa, Oklahoma, and James D. Miller (hereinafter, "Appellees") alleging breach of contract, negligence, and outrage. Appellant alleges he was born in Syria into the Muslim Faith, but for most of his adult life has resided in the United States. As part of what he refers to as his westernization, Appellant made the decision to convert from Islam to Christianity.
The precise relationship between Appellant and Appellees is disputed, but it is undisputed that Appellant was baptized at his own request at The First Presbyterian Church U.S.A. of Tulsa, Oklahoma (FPC) by James D. Miller (Miller). Appellant alleges he made Appellees aware of the need for confidentiality throughout the conversion process, as he was planning to return to Syria shortly thereafter. Appellant's baptism took place on December 30, 2012, during a service that was open to members and guests of the church, but was not televised. It is undisputed that Appellant was not and never became a member of FPC, before or after his baptism.
Appellant alleges he travelled to Syria almost immediately after his baptism, arriving in Damascus on January 2, 2013. Appellant asserts he was confronted by radical Muslims in Damascus in mid-January, 2013, who had heard of his conversion on the internet. Appellant alleges he was kidnapped, and informed by his kidnappers they were going to carry out his death sentence as a result of his conversion from Islam.
Appellant alleges he was tortured for several days before he was able to escape captivity, killing his paternal uncle in the process. As a result, he asserts he is now wanted for murder in Syria. Appellant alleges he was able to clandestinely make it back to the United States, where he faces continuous death threats. Appellant asserts he suffered numerous physical injuries and psychological damage, all proximately caused by Appellees' publication of his baptism, in contravention of promises they supposedly made to him that it would be kept confidential.
The suit was filed after he returned to the United States.
Recognizing the importance of the autonomy of religious institutions within the framework of the United States legal system, the courts must refrain from undue interference with religious beliefs and practices. Appellant exercised his right to convert to Christianity and accord his religious beliefs with the demands of his conscience. Similarly, Appellees exercised their right to perform the sacrament of baptism in accordance with the doctrine and a custom of the Church. It is not the role of the courts to adjudicate a dispute between Appellant and Appellees over the publication of Appellant's baptism in accord with Church practice, even if Appellant was harmed by his baptism and its subsequent publication. Per the church autonomy doctrine, the courts lack subject matter jurisdiction over the matter. Accordingly, the decision of the trial court is affirmed.
Tuesday, February 14, 2017
The New York Appellate Division for the First Judicial Department affirmed the conclusion that New York has jurisdiction to consider claims related to Nazi art theft
The genesis of this litigation was in 1939, when, with the Nazi invasion imminent, decedent Oscar Stettiner, a Jewish art collector, abruptly fled Paris, leaving his art collection behind. His art collection was later sold by the Nazis, including an early twentieth century painting by the Italian artist Amedeo Modigliani, which Stettiner's heir seeks to recover. The issue before this Court is whether petitioner International Art Center, S.A. (IAC), which purchased the painting in 1996 for $3.2 million, has standing to challenge the ancillary letters of administration issued to the heir's representative for purposes of commencing litigation to recover the painting. We hold that petitioner lacks standing, and that, in any event, the limited ancillary letters were properly issued.
In the immediate aftermath of World War II, the United States and its allies took on the task of locating and returning the many great works of art systematically looted by the Nazis. While millions of works were recovered and returned to the rightful owners, individual Holocaust victims and their heirs have struggled for decades to obtain restitution.
The efforts to recover these treasures have been recently popularized in movies including 2014's "Monuments Men," and 2015's "Woman in Gold," which chronicled Maria Altmann's pursuit of her family's paintings looted in Austria, including Gustav Klimt's "Portrait of Adele" (1907), of which Altmann won restitution following litigation that reached the United States Supreme Court (see Republic of Austria v Altmann , 541 US 677 ).
While this great theft may have taken place more than 70 years ago, a resolution was not possible until a combination of scholarship and technology allowed for the creation of databases compiling lists of missing works, and until nations agreed to international guidelines on art restitution such as those laid out in the 1998 Washington Principles on Nazi-Confiscated Art. Even at the tail end of 2016, the United States Congress felt it necessary to pass additional legislation to aid victims of Holocaust-era persecution and their heirs to recover works of art confiscated or misappropriated by the Nazis, and to ensure that claims to artwork and other property stolen or misappropriated by the Nazis are not unfairly barred by statutes of limitations but are resolved in a just and fair manner. This legislation became law on December 16, 2016 (see Holocaust Expropriated Art Recovery Act of 2016 (Pub L 114-308, 130 US Stat 1524, amending 22 USC § 1621 et seq. ).
The painting at issue is known as "Seated Man With a Cane" (1918) and is currently owned by petitioner. It is alleged to have been confiscated by the Nazis from decedent, who resided in Paris in the 1930s.
Respondents, the Estate of Oscar Stettiner (Estate), Philippe Maestracci, and George W. Gowen, as Limited Ancilliary Administrator of the Estate of Oscar Stettiner, contend that in 1930 decedent Oscar Stettiner purchased a painting, which he subsequently loaned to the 1930 Venice Biennale, a world-famous art exhibition. The painting was listed as number 35 in the exhibition, and, according to respondents, a label on the back of the painting by the Venice Biennale establishes it is the same painting as the one at issue in this case.
IAC also challenges whether the Surrogate's Court had jurisdiction to entertain this matter. SCPA 206(1) provides that the Surrogate's Court has jurisdiction over the estate of any nondomiciliary decedent who leaves property in the state. The Surrogate's Court should decline to exercise jurisdiction only when the controversy in no way affects the affairs of a decedent or the administration of the estate (see Matter of Piccone , 57 NY2d 278, 288 ).
Significantly, although the authority of the Surrogate's Court over a nondomiciliary's estate in an ancillary proceeding is generally limited to estate assets within New York (see Matter of Obregon , 91 NY2d 591, 601 ), property includes a "chose in action," e.g. a cause of action in New York (see SCPA 103).
Accordingly, contrary to IAC's contention, SCPA 206(1) does not require the physical presence of the subject property in New York at the time the proceeding for ancillary letters was commenced. It is sufficient that the Estate had a valid "chose in action" against two New York domiciliaries (the Nahmads), a New York corporation (the Gallery), and IAC, a foreign entity alleged to be owned and controlled by New York residents and doing business in New York.
IAC's reliance on cases where, unlike the "chose in action" here, the estate property was not located in New York is misplaced (see e.g. Leve v Doyle, 6 AD2d 1033 [1st Dept 1956]). IAC similarly misplaces reliance on Obregon which involved the estate pursuing claims against parties and trust assets in the Cayman Islands and not in New York.
Nor is there merit to IAC's personal jurisdiction claim. Initially, Surrogate's Court did not require personal jurisdiction over IAC in order to determine whether or not to revoke the grant of ancillary letters of administration since ICA was not a respondent in that proceeding. In any event, a court may exercise personal jurisdiction over any nondomiciliary who, in person or through an agent, transacts any business within the state or contracts anywhere to supply goods or services in the state or commits a tortious act within the state or regularly does or solicits business or engages in any other persistent course of conduct (CPLR 302[a] and ). The commission of some single or occasional acts of an agent in a state may be enough to subject a corporation to specific jurisdiction in that state with respect to suits relating to that in-state activity (see International Shoe Co. v Washington , 326 US 310, 318 ;Daimler AG v Bauman , __US__, __, 134 SCt 746, 754 ; see also LaMarca v Pak-Mor Mfg. Co. , 95 NY2d 210, 214-216 ).
In this case, personal jurisdiction was acquired based on IAC's admitted agreement with Sotheby's to act as its agent to sell the painting in New York in 2008. Further, personal jurisdiction over IAC may be based on respondents' allegations that IAC transacted business in New York through the Nahmads at the Gallery's office in Manhattan.
Thursday, February 9, 2017
The New York Court of Appeals resolved a dispute among attorneys over fees in a case involving an $8 million settlement
In February 2009, Menkes engaged Manheimer to act as co-counsel and provide advice in the action. Their written agreement provided that Manheimer would receive 20% of net attorneys' fees if the case settled before trial and 25% once jury selection commenced. Neither attorney informed the clients of Manheimer's involvement, although Manheimer believed Menkes had done so.
The co-counsel relationship fell apart
In August 2009, Menkes wrote to Manheimer unilaterally discharging him and advising him that his portion of the fees would be determined on a quantum meruit basis. Manheimer did not respond to Menkes; he did no further work on the case.
The court here affirmed the Appellate Division for the First Department.
We conclude that Menkes's agreements with Manheimer are enforceable and entitle Manheimer to 20% of net attorneys' fees. Menkes's attempt to use the ethical rules as a sword to render unenforceable, as between the two attorneys, the agreements with Manheimer that she herself drafted is unavailing. Her failure to inform her clients of Manheimer's retention, while a serious ethical violation, does not allow her to avoid otherwise enforceable contracts under the circumstances of this case (see Samuel v Druckman & Sinel, LLP, 12 NY3d 205, 210 ). As we have previously stated, "it ill becomes defendants, who are also bound by the Code of Professional Responsibility, to seek to avoid on 'ethical' grounds the obligations of an agreement to which they freely assented and from which they reaped the benefits" (Benjamin v Koeppel, 85 NY2d549, 556  [citation omitted]). This is particularly true here, where Menkes and Manheimer both failed to inform the clients about Manheimer's retention, Menkes led Manheimer to believe that the clients were so informed, and the clients themselves were not adversely affected by the ethical breach.
The court applied general contract principles in allocation of fees. (Mike Frisch)
Monday, January 23, 2017
The Rhode Island Supreme Court decided a case where the court had granted review of the following question
“May a former client in a legal malpractice action against his former attorney properly compel discovery from his former attorney and law firm related to documents the attorney prepared for the attorney’s other clients in order to gain evidence to prove subsequent remedial measures in the legal malpractice action?”
The unhappy client sued and sought discovery
This case came before the Supreme Court on November 2, 2016, on certiorari from the Superior Court, seeking review of a discovery order entered on October 2, 2014, compelling production of any antenuptial or postnuptial agreements drafted, prepared, or negotiated by the defendant, Richard A. Boren (Attorney Boren), from 2005 through 2009 and in 2013, while he was employed at the defendant law firm, Visconti, Boren & Campbell, Ltd. (VBC), (collectively, defendants). Before this Court, the defendants contend that the documents sought exceed the scope of permissible discovery, as provided by Rule 26 of the Superior Court Rules of Civil Procedure, and are protected under the attorney-client privilege, the marital privilege, and the work product doctrine. For the reasons discussed herein, we affirm the discovery order in its entirety.
In 2000, plaintiff, Sergio A. DeCurtis (plaintiff or DeCurtis), retained Attorney Boren to draft an antenuptial agreement. DeCurtis and his then-fiancée, Michelle Tondreault (Tondreault), executed the antenuptial agreement on March 22, 2000, and were married on March 28, 2000. They did not live happily ever after, and Tondreault filed for divorce in 2005.
The divorce petition was dismissed in a negotiated settlement that required DeCurtis and Tondreault to execute a postnuptial agreement. Attorney Boren drafted the postnuptial agreement for the couple, which was executed in November of 2005. The marriage nonetheless failed.
The plaintiff claims that the six antenuptial and postnuptial agreements drafted by Attorney Boren are discoverable under Rule 26(b)(1) because they are relevant to demonstrate if and when Attorney Boren undertook subsequent remedial measures in the drafting of antenuptial and postnuptial agreements. Unlike many other jurisdictions, subsequent remedial measures are admissible in Rhode Island to prove negligence “[w]hen, after an event, measures are taken which, if taken previously, would have made the event less likely to occur...
In the case before us, plaintiff initially retained Attorney Boren in 2000, and the antenuptial agreement between plaintiff and Tondreault was drafted in that same year. In 2005, Attorney Boren drafted a postnuptial agreement, which affirmed the terms stated in the prior agreement. The instant malpractice suit arises out of language that was included in both documents. As a result, we are of the opinion that the triggering “event” for purposes of Rule 407 is the drafting of the later document, the 2005 postnuptial agreement. Accordingly, any measures taken after 2005 would be relevant under Rule 407 and, therefore, discoverable under Rule 26(b)(1)
The attorney-client, work product and marital privileges did not prevent discovery
we are of the opinion that defendants do not have standing to assert the attorney-client privilege on behalf of their clients in this context. In this case, the documents are not confidential communications such that third parties were privy to the discussions surrounding the documents and their execution, thus vitiating the privilege. We conclude that the Superior Court justice amply placed safeguards on the order by requiring redaction and limiting the purpose for which the documents could be used. Adequate redaction will eliminate any sensitive or identifying information and prevent the disclosure of any confidential interests contained in the documents...
The defendants’ argument that the marital privilege applies in this context is unavailing. The parties to the six agreements are not testifying, and the production of executed contracts is not testimonial in any way. Furthermore, the parties were not married at the time the antenuptial agreements were executed. The marital privilege focuses on communications between a husband and wife, such that the communications must occur “during [the] marriage.”
In complying with this discovery order, the defendants are directed to adequately redact all confidential information and take any additional steps they deem reasonably necessary to ensure confidentiality, including contacting their clients should that be deemed necessary. To the extent that the clients wish to assert the attorney-client privilege, the Superior Court should welcome those motions and use our discussion herein as guidance in rendering a decision.
Finally, we anticipate that the trial justice will act as an additional gatekeeper and conduct an in camera review of the documents after adequate redaction by the defendants, in order to ensure that all confidential and identifying information has been removed.
The court thus affirmed the discovery order. (Mike Frisch)
Wednesday, January 18, 2017
The Massachusetts Supreme Judicial Court rejected both prosecution and defense positions in the ongoing fallout from a dishonest chemist
We once again confront the tragic legacy of the misconduct of Annie Dookhan when she was employed as a chemist at the William A. Hinton State Laboratory Institute (Hinton lab)...
We instead adopt a new protocol for case-by-case adjudication, which will occur in three phases, and order its implementation by the single justice in the form of a declaratory judgment. In the first phase, the district attorneys shall exercise their prosecutorial discretion and reduce the number of relevant Dookhan defendants by moving to vacate and dismiss with prejudice all drug cases the district attorneys would not or could not reprosecute if a new trial were ordered. In the second phase, new, adequate notice shall be approved by the single justice and provided to all relevant Dookhan defendants whose cases have not been dismissed in phase one. In the third phase, CPCS shall assign counsel to all indigent relevant Dookhan defendants who wish to explore the possibility of moving to vacate their plea or for a new trial. If the number seeking counsel is so large that counsel cannot be assigned despite CPCS's best efforts, the single justice will fashion an appropriate remedy under our general superintendence authority for the constitutional violation, which may include dismissing without prejudice the relevant drug convictions in cases where an indigent defendant is deprived of the right to counsel.
The opinion was reported by Justice Botsford. (Mike Frisch)
Friday, January 6, 2017
An effort by the Metropolitan Opera to invoke workers' compensation law in a matter involving a rather unique occupation led to a decision of the New York Appellate Division for the First Judicial Department
Defendant Metropolitan Opera Association, Inc. (the Met) operates the Metropolitan Opera House at Lincoln Center. Plaintiff, Wendy White, is a renowned opera singer who has been featured in more than 500 performances at the Met over the course of 23 years. This personal injury action arises from plaintiff's fall from an elevated platform while performing at the Met...
Plaintiff alleges that, on December 17, 2011, during her performance of the role of Marthe in the Met's production of the opera Faust, she fell and was seriously injured while walking from a backstage staircase to an on-stage elevated platform. She alleges that the accident was caused by a defect in the set's design or construction resulting from the Met's negligence. She further alleges that she performed at the opera house pursuant to a standard contractor's agreement between the Met and her corporation, Wendy White, Inc. (WW, Inc.), and that neither she nor WW, Inc. were the Met's "employees."
The Met moved to dismiss the complaint pursuant to CPLR 3211(a)(1) and (7), arguing that documentary evidence conclusively established that plaintiff was an employee engaged in the performing arts, as defined by WCL § 2(4), or, alternatively, a special employee of defendant, since the Met controlled the manner in which she performed her work, and that therefore her claim was barred by the exclusive remedy provision of WCL § 11.
The star responds
Plaintiff submitted her own affidavit, in which she averred that she was not employed by the Met but, instead, by WW, Inc. She explained that she was always paid by WW, Inc., and that WW, Inc. only received 1099's, not W-2's, from the Met. She also did not receive any employment benefits from the Met, and was in fact told that she did not qualify for the Met's health insurance plan because she was not an employee.
Plaintiff asserted that she was a "star" and that, as such, she had "full artistic control" over her performance, including choosing "the timbre, the volume, the projection, and all of the artistry in the form of nuance, inflection and the acting." She claimed to have received no training, supervision, or direction from the Met with respect to how to perform her role, and explained that her voice lessons and coaching were paid for by WW, Inc. She admitted, however, that the Met provided her make-up, costumes, and wigs, told her "where and when to attend rehearsals and performances," and "blocked out the basic staging with entrances and exits" - although she purported to have veto power even with respect to staging decisions.
Additionally, plaintiff stated that she was not aware that the Met purchased workers' compensation insurance for her, and never consented to any claim being filed thereunder. She explained that she only found out later that certain medical bills had been paid by the Met's insurance carrier, and rejected any subsequent offers of payment. Instead, she filed a claim in New Jersey under WW, Inc.'s workers' compensation insurance policy.
Plaintiff also submitted statements by Assemblyman Roger J. Robach and New York State Senator James J. Lack, the sponsors of the 1986 amendment to the WCL that added section 2(4), addressing the employment status of performing artists. Robach explained in a letter to the Governor's Counsel that the amendment was intended to clarify that "the vast majority [of musicians and performers] who are not in the star' category" were employees entitled to workers' compensation benefits, without having to litigate their status. In an affirmation submitted with the motion, Lack explained that "[t]he bill was not intended to compel star' performers, who are independent professionals able to negotiate the terms of their engagements, to become employees' of the venues at which they perform."
The court agreed that Ms. White was not an employee covered by workers' compensation law. (Mike Frisch)
The Washington State Supreme Court has held that pimps are subject to multiple counts of promoting prostitution per the number of prostitutes in their employ
At issue in this case is whether a pimp can be convicted on multiple counts of promoting prostitution when multiple prostitutes are involved. We have not previously considered the unit of prosecution for second degree promoting prostitution. In light of the statute's plain language and prior decisions of this court, we affirm the Court of Appeals and hold that the legislature expressed its clear intent to authorize multiple convictions when one pimp exploits multiple individuals.
Shacon Barbee was a pimp that made money from prostitutes working under his supervision. Three young women that Barbee "supervised" during 2010 were SE, BK, and CW.
SE met Barbee when she was 13 and began working for him as a prostitute when she was 16. Along with posting ads on websites such as Backpage.com, SE would also work "the track" (a slang term for working on the streets) in popular Seattle-area prostitution locations including Aurora Avenue and Pacific Highway South. SE thought that Barbee cared about her and that they would spend their lives together. She testified at trial that she was expected to make $1,000 a day or stay up at night until she met that quota. All of her earnings went to Barbee. Barbee required SE to recruit other girls or young women to work for him as prostitutes. SE would peruse websites like MySpace or Facebook, looking for attractive girls who might be interested in "escorting." During 2010, two of the women she recruited on Barbee's behalf were two 18-year-olds, BK and CW.
He claimed that multiple punishments for promoting BK and CW violated double jeopardy.
Divisions One and Two of the Court of Appeals have come to different conclusions regarding whether the statute evinces a clear legislative intent to impose multiple punishments when one individual employs two or more prostitutes in the same time frame.
Resolving the division split
...the text of the statute is clear. The legislature authorized charges premised on either operating a prostitution enterprise or promoting individual prostitutes. Although not necessary to resolve the issue, an examination of the statute's legislative history also confirms that a defendant may face multiple convictions when he or she "promotes" multiple prostitutes. The history of Washington's promoting prostitution statute indicates that the statute is "victim-centered" and focused on criminalizing the promotion of prostitution as it related to each individual exploited.
...while the plain language of the statute is unambiguous, the legislative history also clearly reflects that the legislature intended the crime to be, in part, a crime against individual persons.
In sum, in light of the plain language of the statute and consistent with our prior construction of similarly worded statutes, we hold that the legislature, by use of the language "a person," unambiguously authorized a unit of prosecution for each person promoted. When a defendant promotes prostitution of more than one individual, he or she may be prosecuted for more than one count.
Tuesday, January 3, 2017
The Delaware Supreme Court has ruled in favor of the Katten Muchin law firm in a case involving application of the law of charging liens.
The case was a complex fight over the client's ouster from a family business
Martha reacted to her ouster by, among other things, litigating. She first retained plaintiff Katten Muchin Rosenman LLP to represent her in a § 220 books and records request of the Sutherland Lumber Companies. Although Martha and Katten disagree over whether they entered into a written fee agreement, the parties agree that Katten was not providing its services on a contingency fee basis and was instead entitled to fees on an hourly rate basis and to reimbursement of its expenses. Indeed, Katten sent Martha monthly invoices based on hourly billing, which Martha paid for several years.
In 2006, Martha, with Katten as her counsel, filed a derivative and double derivative action against Perry, Todd, and Mark alleging, among other things, that Perry‘s and Todd‘s employment agreements with the Sutherland Lumber Companies were a result of self dealing...
Some benefits were realized with respect to the employment agreements at issue but
By 2011, [client] Martha accrued $766,166.75 in unpaid attorney‘s fees for services that Katten provided in this litigation between 2009 and 2011. In the spring of 2011, Katten withdrew as counsel. One of Martha‘s attorneys from Katten, Stewart Kusper, left the firm and continued to represent her.
After Martha‘s litigation concluded in 2012—without her securing any additional relief on behalf of the Sutherland Lumber Companies—she sought an award of attorney‘s fees from the Sutherland Lumber Companies for all of her fees arising from the § 220 action and from overcoming the special litigation committee‘s investigation and recommendation to terminate the litigation, plus $25,000 in fees for defending against the summary judgment argument aimed at the employment agreement claim. In total, Martha asked for $1.4 million in attorney‘s fees and, in doing so, she used Katten‘s invoices that detailed the services it provided to her and its expenses incurred on her behalf while it represented her as a reasonable basis for the fees she should be awarded. Indeed, in Martha‘s petition for an award of attorney‘s fees, she argued that the $1.4 million in attorney‘s fees she incurred from Katten were "fair and reasonable."
...Relying on Katten‘s invoices, the Court of Chancery awarded Martha $275,000 in fees for the minor benefits that she obtained on behalf of the Sutherland Lumber Companies in 2007 when, as a result of Martha‘s and Katten‘s efforts, the Sutherland Lumber Companies amended Perry‘s and Todd‘s employment agreements.
The firm intervened and asserted a lien on the fee award.
The court here reversed the Court of Chancery
Although Delaware does not have a statute governing charging liens, Delaware has a long lineage of cases recognizing charging liens as a matter of common law. Two recent Delaware cases address charging liens. In Doroshow, this Court confirmed that Delaware recognizes the long-standing common law right of charging liens. In Zutrau, the Court of Chancery adopted the definition provided by Corpis Juris Secundum that a charging lien is "an equitable right to have costs advanced and attorney‘s fees secured by the judgment entered in the suit wherein the costs were advanced and the fee earned." Today, we also endorse that definition of a charging lien.
Here, the modifications to Perry‘s and Todd‘s employment agreements— which are the basis for Court of Chancery‘s fee award—were adopted as a result of Martha‘s and Katten‘s efforts in the derivative and double-derivative action. Furthermore, Katten‘s unpaid fees arose from the same litigation that produced the benefits for the Sutherland Lumber Companies and which led to the Court of Chancery‘s award of attorney‘s fees. Therefore, based on our definition of a charging lien, Katten is entitled to a lien on the entire fee award of $275,000. The historical rationale for a charging lien—to promote justice and equity by compensating the attorney for her efforts and thus encouraging attorneys to provide legal services to clients—also supports this conclusion.
In its decision, the Court of Chancery seemed to read Doroshow as standing for a rule that an attorney may only seek a charging lien for fees the attorney incurred that were directly connected to her client‘s recovery. The Court of Chancery cited Doroshow‘s finding that, because the law firm in that case represented its client on a contingent fee basis, it was entitled to a charging lien because "the law firm had not been compensated before its work produced the funds." The Court of Chancery reasoned that because Katten had already been paid for the services that led to the benefits for the Sutherland Lumber Companies, it was not entitled to a charging lien. But, Doroshow dealt with a charging lien based on a contingency fee, and we held that the law firm was entitled to its agreed 40% contingent fee. Our decision in Doroshow did not limit the scope of charging liens in general. Rather, Doroshow demonstrates the application of this equitable right to a particular type of fee arrangement, and one fundamentally different than the one between Martha and Katten.
Here, Katten billed Martha regularly for its services based on the amount of time Katten‘s attorneys spent on the case and the attorneys‘ hourly rates. Katten billed Martha for approximately $3.5 million, of which Martha paid roughly $2.7 million. That Katten‘s services underlying the unpaid fees did not result in any benefit to the Sutherland Lumber Companies does not matter. In the case of hourly billing, unlike with a contingency fee, the total amount that the client is required to pay her lawyer is not based on the client‘s recovery. In Zutrau, the Court of Chancery considered the scope of a charging lien in the context of hourly billing and explained that "[i]t is no secret that litigation is expensive and that the costs of prosecution easily can exceed the recovery." The Court of Chancery found, "that the cost of prosecution conceivably could exceed the recovery does not excuse Zutrau from paying those fees." If, as here, an attorney has unpaid fees that are greater than the client‘s recovery, the attorney is entitled to a charging lien on the entire recovery. Moreover, the client remains obligated to pay her attorney any remaining unpaid fees. Martha was required to pay Katten its reasonable fees in accordance with their agreement whether she won or lost. Because Martha did not pay Katten for all of its services stemming from the litigation in which Katten produced the only benefits, Katten is entitled to the equitable right of a charging lien on the entire $275,000 fee award. Finding otherwise would lead to an inequitable result where attorneys with a claim for unpaid fees from litigation— where work had been billed on an hourly basis—could use the equitable right of a charging lien only to recover fees relating to the services that were directly connected to the litigation‘s beneficial results.
Like other contracts, contracts for the provision of legal services create incentives for parties, including clients. When a party, such as Martha, agrees to pay hourly fees to prosecute a complex case, she is assuring her counsel that it will not suffer the commercial damage of uncompensated services if it presses her claims as aggressively as she demands and as the law permits. To permit a client who is a party to such an agreement to escape a charging lien as if she made a strict contingency fee agreement limiting fees to a percentage of recovery is to judicially rewrite the contract at the expense of the attorney and to undermine the traditional purpose of a charging lien.
Monday, January 2, 2017
The year 2017 will be one of the most consequential in the history of the District of Columbia Bar with the retirement and replacement of the most influential actors in the regulation and administration of the legal profession.
The ultimate responsibility for the regulation and direction of the D.C. Bar rests with the highest court of the jurisdiction - the Court of Appeals.
From the Court's Rule I creating the unified Bar
The purposes of the Bar shall be to aid the Court in carrying on and improving the administration of justice; to foster and maintain on the part of those engaged in the practice of law high ideals of integrity, learning, competence in public service, and high standards of conduct; to safeguard the proper professional interest of the members of the Bar; to encourage the formation and activities of volunteer bar associations; to provide a forum for the discussion of subjects pertaining to the practice of law, the science of jurisprudence and law reform, and the relations of the Bar to the public, and to publish information relating thereto; to carry on a continuing program of legal research and education in the technical fields of substantive law, practice and procedure, and make reports and recommendations thereon; to the end that the public responsibility of the legal profession may be more effectively discharged.
Chief Judge Eric Washington will step down this March.
The court not only administers the attorney discipline system but also must work with the organized Bar on a wide array of issues including budget, i.e., the spending of mandatory dues.
The next Chief Judge will play a key role in the uncertain future.
The Bar's longtime Chief Executive Officer is also retiring at the end of March and "brings to a close a remarkable career that spans 34 years of continuous service to the D.C. Bar. "
With the new building in the works, it has never been more important to have an independent leader with a fresh approach and superb managerial skills who has no loyalty to any bar faction other than its membership in the broadest sense.
I do not know who hires the next Chief Executive Officer (I assume that the task falls to the Bar's Board of Governors) but the process should be as transparent as possible and give the largest possible voice to the membership.
Finally, there will be a new Disciplinary Counsel this year, replacing one who has been in discipline for a like period as the Chief Executive Officer has been running the Bar.
The replacement will be chosen by the Board on Professional Responsibility.
It has been widely (if not publicly) recognized that there is room for considerable improvement in the operation of every aspect of the attorney discipline process in D.C.
The choice of the new Disciplinary Counsel is the key decision that will determine the future of attorney regulation in the District of Columbia.
The Executive Attorney of the Board on Professional Responsibility - also a bar careerist - retired and was replaced in 2016.
I am confident that the decisionmakers responsible for the public trust that the Bar offices embody will bring in fresh blood to invigorate a Bar that for far too long has been an inside job.
As George Allen (the coach not the politician) once said:
The Future is Now!
Wednesday, December 28, 2016
Dan Trevas has a summary of an Ohio Supreme Court decision permitting a damages claim against an attorney/conservator
Civil lawsuits can be filed based on claims of being victimized by a criminal act, even when financial compensation is not specifically authorized by law, the Ohio Supreme Court ruled today.
The Supreme Court addressed whether the current version of an Ohio statute permits a civil lawsuit based on any criminal act, or if the law simply reinforces a long-standing legal principle that limits lawsuits based on the type of criminal act committed. Writing for the Court majority, Justice William M. O’Neill indicated that R.C. 2307.60 is “plain and unambiguous” and allows for a civil action for damages that result from any criminal act, unless a suit is specifically prohibited by law.
The decision resolves conflicting interpretations among Ohio courts, and reverses a ruling by the Summit County Common Pleas Court that decided Jessica Jacobson could not file a civil lawsuit against Akron Children’s Hospital, Cleveland Clinic Children’s Hospital for Rehabilitation, and attorney Ellen C. Kaforey, who was an appointed conservator to Jacobson’s mother. Jacobson’s lawsuit alleged the crimes of unlawful restraint, kidnapping, and child enticement by Kaforey and the hospitals when Jacobson was 7 years old.
Justice Sharon L. Kennedy issued a concurring opinion, finding R.C. 2307.60 is ambiguous. She explained the 1985 legislative history that accompanied the statute shows that the General Assembly authorized civil lawsuits based on criminal acts.
In a dissenting opinion, Justice Terrence O’Donnell maintained that R.C. 2307.60 is simply an update in the Ohio Revised Code that continues to permit only lawsuits for specific crimes, and he supported his position by noting the General Assembly has passed several statutes that expressly permit victims of certain crimes to file civil lawsuits.
Jacobson Sent to Live with Relative
Kaforey, an attorney and registered nurse, was appointed by the Summit County Probate Court as a conservator to assist Jacobson’s mother in making medical decisions for Jacobson in her youth. Jacobson alleged in her lawsuit that in 2001, when she was 7, Kaforey kept her mother from visiting her when she was hospitalized. She alleged that Akron Children’s and Cleveland Clinic Children’s aided Kaforey in kidnapping her by arranging without authority to have her live with a relative in Florida, and that Kaforey, in concert with the hospitals, enticed her onto a plane and was flown to Florida without the legal permission from her mother.
As an adult, Jacobson, acting without an attorney, filed the lawsuits against Kaforey and the hospitals based on the three criminal code sections of the crimes she alleged. The trial court granted Kaforey’s and the hospitals’ request to dismiss the case, and the trial court observed that “Ohio courts have established that civil actions for damages may not be predicated upon alleged violation of a criminal statute.”
Jacobson appealed to the Ninth District Court of Appeals, which allowed Gary Kirsch, Jacobson’s stepfather and legal guardian, to substitute himself for her in the appeal, and he hired an attorney to represent him. A divided Ninth District in 2015 reversed the trial court and found the current version of R.C. 2307.60 authorizes Jacobson to file her civil lawsuit.
At the request of Kaforey and the hospitals, the Ninth District certified that its opinion was in conflict with several other courts of appeals. The Ninth District asked the Supreme Court to resolve the conflict, and the Court agreed to hear the case.
Justice O’Neill explained the provision at the heart of the dispute is R.C. 2307.60(A)(1), which provides: “Anyone injured in person or property by a criminal act has, and may recover full damages in, a civil action unless specifically excepted by law, may recover the costs of maintaining the civil action and attorney’s fees if authorized by any provision of the Rules of Civil Procedure or another section of the Revised Code or under the common law of this state, and may recover punitive or exemplary damages if authorized by section 2315.21 or another section of the Revised Code.”
He noted the Court reviews a statute to determine if it is ambiguous, which means it is “capable of bearing more than one meaning,” and if the language is unambiguous, the Court is prevented from digging deeper into the legislature’s intent or public policy issues.
Justice O’Neill wrote the General Assembly explicitly chose the words “any person injured ... by a criminal act has ... a civil action unless a civil action is specifically excepted by law.” And he noted the preamble to the original legislation enacting R.C. 2307.60, which became effective in 1985, “demonstrates that the General Assembly specifically sought to create a civil cause of action for damages resulting from any criminal act.”
“These legislative statements are crystal clear. We need not dig further into the meaning of the statute than the language that was signed into law. Although R.C. 2307.60 has been amended a number of times since 1985, current R.C. 2307.60(A)(1) continues to specifically authorize a civil action for damages based on the violation of any criminal statute, unless an exception applies,” he concluded.
He added that the Court makes no ruling on how the statute operates and what a plaintiff must do to prove a claim. The Court remanded the case to the trial court for further proceedings.
Chief Justice Maureen O’Connor and Justices Paul E. Pfeifer and Judith Ann Lanzinger joined Justice O’Neill’s opinion.
Concurrence Finds Law Ambiguous
Justice Kennedy concurred in judgment only, noting that she finds the language is ambiguous “because the phrase ‘has ... a civil action’ in R.C. 2307.60(A)(1) is reasonably susceptible of more than one meaning.” Because the statute is ambiguous, she examined the legislative history that accompanied the bill when the statute was amended in 1985 and all subsequent amendments to the statute through 2014.
In 1985, the Legislative Service Commission explained what the proposed changes to the statute would mean in a bill analysis, Justice Kennedy noted. While the Court is not bound by this analysis, she explained that the Court may refer to it if it is helpful in determining the meaning of an ambiguous statute.
“Based on the circumstances surrounding the original amendments that became effective in 1985, the former statutory provisions, and the compelling legislative history, it becomes clear that when the General Assembly recodified former R.C. 1.16 as R.C. 2307.60, it intended to create an independent civil cause of action for any crime victim injured in person or property,” Justice Kennedy concluded.
Justice Kennedy noted that the lower courts have been citing each other’s opinions relying on pre-1985 decisions that did not recognize the legislature changed the law in 1985 when it enacted R.C. 2307.60, and none of the opinions cited after 1985 “engaged in a meaningful analysis” of the law. She explained the legislature has amended the code section six times since 1985, even during “significant tort-reform measures” but has not disturbed the right to sue based on a criminal act.
Allowing victims of only certain criminal acts to sue while barring others would create a disparity in treatment, Justice Kennedy wrote. Following the interpretation suggested by the appellants would mean that a victim of a theft offense enjoys a statutory right of full recovery and under certain conditions a presumption of liability against the criminal perpetrator, but a rape victim must bring a common-law-tort cause of action and thereafter re-prove during the civil trial the existence of the assault and battery and that the rapist was responsible for the assault and battery, she noted.
Sixth District Court of Appeals Judge James J. Jenson, sitting for Justice Judith L. French, joined Justice Kennedy’s opinion.
Dissent Argues Against Lawsuits Based on any Crimes
Justice O’Donnell argued as the appellate court held, that the statute only codified common law and only claims that authorize the pursuit of civil damages based on a criminal act can be pursued.
He explained that while Jacobson cannot sue based on the three criminal violations she selected, common law causes exist for false imprisonment, assault and battery, and “it is not necessary for the General Assembly to create civil actions for violating unlawful restraint, assault, and battery statutes.”
Justice O’Donnell noted that the legislature is presumed to be aware of prior judicial interpretations of a statute when enacting amendments, and that during the times R.C. 2307.60 has been amended since 1985 lawmakers never expressed an intent to enact a separate cause of action for a violation of a criminal act.
He referenced several specific statutes created that allow civil lawsuits based on specific criminal statutes, including ones for the victims of hazing, child stealing, trafficking in persons, forced abortion, identity theft, and theft of cable television services.
Justice O’Donnell concluded as follows: “Accordingly, if the position asserted by the majority were correct, i.e., that R.C. 2307.60 creates an independent civil cause of action for damages resulting from a criminal act, then there would be no need for the General Assembly to have specifically statutorily authorized any of the listed causes of action to recover damages resulting from those criminal acts.”
Justice O’Donnell would reinstate the trial court’s judgment.