“A Mississippi Supreme Court justice and a wealthy attorney who helped land the state millions in tobacco settlement money were among five people indicted Friday on federal fraud and bribery charges. Biloxi attorney Paul Minor is accused of funneling hundreds of thousands of dollars to Justice Oliver Diaz Jr., Diaz’ former wife, Jennifer, and to two lower court judges. In return, Minor allegedly received favorable treatment for Minor and his clients in cases involving multimillion dollar judgments.” The 16-count indictment also names former Harrison County Judges Wes Teel and John Whitfield. Prominent in the state’s tobacco litigation, Minor is the son of a well known Magnolia State political columnist, Bill Minor. (Jack Elliott Jr., “Justice, Attorney Charged in Mississippi”, AP/Sarasota Herald Tribune, Jul. 25; Jerry Mitchell, “Justice, 4 others indicted”, Jackson Clarion Ledger, Jul. 26; Jerry Mitchell, “Charges may alter opinions of Miss. judiciary”, Jackson Clarion Ledger, Jul. 27; Jack Elliott Jr., “Indictment of justice and lawyer come amid debate between Mississippi business, trial lawyers”, AP/New Orleans Times Picayune, Jul. 27). More: Beth Musgrave, “‘Go see Paul Minor'”, Biloxi Sun Herald, May 18. For our earlier coverage, see: Oct. 9-10 and Oct. 11-13, 2002; May 7 and Jul. 24, 2003.
Posts Tagged ‘ethics’
Update: suspension for maverick Wash. lawyer
In April the Washington Supreme Court issued a six-month suspension from practice to Douglas Schafer, the Tacoma-based attorney who had divulged client confidences in the course of a successful effort to expose a corrupt judge (see Jan. 19, 2000)(Gary Young, “Attorney’s suspension sparks debate”, National Law Journal, Apr. 28; Adam Liptak, “Lawyer Whose Disclosure of Confidence Brought Down a Judge Is Punished”, New York Times/Council of Public Relations Firms, Apr. 20; Schafer’s website)
“Lawyers may instruct on secret taping”
Why is there a secret snickering every time the legal profession poses as heroic champions of the Right to Privacy? In part because of stories like this one: “A New York state trial court has ruled that it is ethically proper for attorneys to advise their clients on how to surreptitiously tape-record their conversations with managers, co-workers and other third parties. … It is the first court ruling on the issue since the American Bar Association reversed its stand in 2001 and issued an ethics opinion that supports an attorney’s right to provide advice on surreptitious taping.” (Steve Seidenberg, National Law Journal, Apr. 28).
Welcome Wall Street Journal readers
Our editor has an op-ed in today’s Journal on the latest developments in California’s “shakedown lawsuit” scandal, in which law firms were discovered to be mass-mailing demand letters holding up small businesses for thousands of dollars apiece under the state’s uniquely liberal “unfair competition law”, otherwise known as Business and Professions Code 17200. In brief, the Democratic leadership of the state legislature in Sacramento is using the scandal as an excuse to push through legislation that, along with a bit of window-dressing reform directed at the more obvious shakedown artists, would actually increase lawyers’ leverage to obtain settlements from defendants under section 17200. (Walter Olson, “The Shakedown State”, Wall Street Journal, Jul. 22). We covered the scandal earlier on Jan. 15-16 and Mar. 3; for more on California’s bounty-hunting Prop 65, follow these links and in particular our post for Nov. 4-5, 2002. More: The Civil Justice Association of California maintains a lot of information on the status of section 17200 legislation, especially here, here and here.
Update: Hager’s bad behavior
Disgraced law professor Mark M. Hager, after being suspended by the District of Columbia bar for a year, at last has resigned his tenured job at American University’s law school, the Washington Post reported in April (James V. Grimaldi, “Hearsay: The Lawyer’s Column”, Washington Post, Apr. 21 (not online); Mary P. Gallagher, “How Not To Settle a Multiparty Suit”, New Jersey Law Journal, May 5 (not online); Julianne Basinger, Jamilah Evelyn, and Katherine S. Mangan, “Suspended Law Professor Loses Tenured Job”, Chronicle of Higher Education”, May 9 (not online). In December the District of Columbia Court of Appeals found Hager “to have engaged in ‘conflicts of interest, dishonesty’ and ‘improper conduct’ when he represented two southern Virginia mothers who wanted to sue the makers of the lice-killing shampoo Nix. The court upheld the D.C. Bar’s one-year suspension of Hager and further ordered him to disgorge the $225,000 fee he shared with co-counsel.” (James V. Grimaldi, “Misconduct in Lice Case Puts AU Professor’s Job in Jeopardy”, Washington Post, Mar. 10). For our earlier coverage of the Hager affair, see Feb. 23, 2000 and May 3, 2001.
Arizona wants less zeal
David Giacalone is posting more interesting stuff at his new EthicalEsq? blog than we can hope to keep up with, particularly on the topic of excessive contingency fees (on which he challenges Public Citizen to amend its not-exactly-pro-consumer stance). One state that has taken a step in the right direction lately is Arizona, whose Supreme Court in June adopted new Rules of Professional Conduct that come down harder on overreaching fees than do the rules of the American Bar Association (Jun. 30).
In recent years Arizona has made itself into something of a laboratory for legal innovation. Of particular interest to us (see Jul. 7 commentary) is a seemingly minor one-word change to the state’s Rules of Professional Conduct (Jun. 6). To quote the court system’s press release, the change “removed the obligation of an attorney to be a ‘zealous’ advocate of his/her client and substituted to ‘act honorably’ in the furtherance of a client?s interests. According to Arizona Supreme Court Vice-Chief Justice Ruth McGregor, ‘Arizona is the first state in the country to make this crucial rule change.’ … ‘We are advised that this definitional change will also be considered by the American Bar Association,’ says McGregor. ‘This change may appear to be subtle,’ explains Chief Justice [Charles E.] Jones, ‘but in fact, it’s a very significant foundational change in the Rules of the Court, and one that is designed to send a distinct message to attorneys.’ The term ‘zealous’ was eliminated from the preamble, because it was erroneously being used by some attorneys to defend behavior that was seen as unprofessional and potentially belligerent, according to one committee member. ‘Jones explains that the State Bar committee’s recommendation … harkens back to a time when lawyers were closely identified as officers of the court. As such, they were duty bound to represent their clients with personal and professional ethics and integrity in mind.'”
We’re impressed. Time and again, in our experience, the putative obligation to represent clients in a “zealous” fashion has proved the last resort of the scoundrel litigator and ethical edge-skater. Yes, in principle there can also arise dangers when lawyers aren’t zealous enough, but no sane observer could imagine that the big problem with American litigation is that lawyers care so much for honor that they aren’t combative enough. We’ll be watching with interest to see whether the change produces any felt difference in Arizona litigation practice.
Suit charges lawyers with using fake clients in diet-drug cases
Mississippi: “Civil lawsuits filed in Jefferson County allege that lawyers signed up fake clients for a 1999 lawsuit that resulted in a $150 million jury verdict against the makers of a diet drug.” According to the allegations, lawyers knew that some clients being recruited into the action had never actually taken the diet drug but “looked the other way”. Defendant lawyers called the allegations “ridiculous” and “preposterous”. Federal law enforcers will not disclose details of their investigation of Jefferson County product liability litigation (see Jun. 29, May 7 and links from there), but it is known that the FBI has subpoenaed prescription records from Fayette’s Bankston Drug Store, which is frequently named in suits (see May 4-6, 2001). (Tom Wilemon, Beth Musgrave and Margaret Baker, “Lawyers faked diet-drug case clients, lawsuits claim”, Biloxi Sun-Herald, Jul. 1; “Miss. lawyers accused of wrongdoing in suit”, AP/Jackson Clarion-Ledger, Jul. 2).
Bilking poor clients
“A prominent San Francisco attorney who represented the young, sick and poor was arrested Tuesday on federal charges of stealing $2 million of his clients’ settlement money to support a lavish lifestyle that included a six-bedroom mansion and a 73-foot yacht.” At its website, the successful San Francisco law firm of Tehin + Partners boasts of having “achieved an exceptional record of performance in litigation and trial through our 20 years + experience as a contingency fee-based plaintiff’s law firm”, not to mention “A Legal Philosophy That Sets Us Apart”. Today’s San Francisco Chronicle has a full helping of grotesque details (Stacy Finz, “S.F. attorney charged with bilking underdog clients”, Jul. 16)
It bears repeating that of all the institutions to which the temporal wealth of poor people is entrusted, law firms are among the least regulated; when outside authorities finally step in to clean up the mess, as here, it is typically after the fact, rather than in a preventive way through the sorts of regular disclosure and auditing requirements that banks or pension funds must meet. Nikolai Tehin lists among his affiliations Board of Directors, San Francisco Trial Lawyers Association. Update Apr. 24, 2005: judge sentences Tehin to 14-year sentence.
Update: San Antonio evidence-faking and witness-tampering case
The Texas case we covered on May 23 and Jun. 26, 2000 and Mar. 17 of this year has now eventuated in a suit by DaimlerChrysler against the Kugle Law Firm. A trial court dismissed the Kugle firm’s $2 billion suit against Chrysler and imposed sanctions of $865,000 against three of the firm’s lawyers after finding that the steering decoupler of the sued-over Dodge Neon had been altered to simulate mechanical failure and that Mexican policemen had been asked to change their accounts of the accident giving rise to the suit. An appeals court called the firm’s conduct ‘an egregious example of the worst kind of abuse of the judicial system.'” “The senior lawyer at the firm, Robert A. Kugle, has been suspended from the Texas bar and has moved to Mexico. He could not be located for comment.” (Adam Liptak, “Law Firm Is Sued Over Conduct in Liability Case”, New York Times, Jul. 10; AP/Miami Herald; San Antonio Express-News). More: David Giacalone at EthicalEsq.? weighs in.
Class action firm subject to judgment
A federal jury in Chicago awarded $36 million ($8.3 million compensatory, the rest punitive) to the former client of class action plaintiffs’ firm Ness, Motley for breach of contract and fiduciary duty. The law firm negotiated a settlement (over the objection of its clients, which it fired at the behest of the defendant) with a convicted felon with tens of millions in frozen assets that gave the firm $2 million in fees, but “next to no compensation” for the ostensible injured parties. (Ness, Motley has since broken up.) (Adam Liptak, “Big Litigation Firm Found to Have Acted Unethically,” NY Times, July 4). The Manhattan Institute issued a press release and a study of the case last August.