California Bar Issues Girardi Letter

The California Bar has issued a report on its own handling of Tom Girardi, who was disbarred last year. The report includes a chart of all 205 complaints that were filed against Girardi during his career, three of which resulted in his disbarment. The names of the claimants are not disclosed. The type of complaint and the disposition is recorded.

There were numerous matters described as “failure to account, deposit” going back many years. These appear to be complaints from clients who were concerned that Girardi had not accounted for funds in his possession. There were insufficient funds notices for his trust account going all the way back to 2006. Girardi appears to have had so much clout that no one would investigate him. Had the California Bar forced him to disclose his trust account transactions in 1985 or 2006, it is possible that many clients would have been protected.

This entry in the report from 1985 is alarming:

85‐O‐12626 5/31/1985 2/6/1987 Failure to account, deposit; failure to perform, delay,
abandonment of client.

…
Closed ‐‐ Investigation ‐‐ Insufficient Evidence

So, it took the Bar almost 19 months to determine whether or not Girardi had failed to account for a client’s funds.

The most serious problem here is that there were several complaints against Girardi, going back to 1985, in which his failure to promptly to pay clients was an issue. This case is reminiscent of the Madoff Ponzi scheme in which a trusted financial advisor was able to fool securities regulators for many years before he eventually ran out of money.

Ed Clinton, Jr.

Former Judge Receives Reprimand in Alabama

On September 16, 2022, the Alabama Supreme Court announced a public reprimand for a former judge.

“Enterprise attorney, Christopher Mark Kaminski was issued a public reprimand with general publication on September 16, 2022, as ordered by the Disciplinary Board of the Alabama State Bar, for violating Rules 8.4(a), (d) and (g) [Misconduct], Alabama Rules of Professional Conduct. In May 2015, Kaminski was appointed as the district court judge for Coffee County and subsequently elected to a full term on November 8, 2015. In September 2018, the Judicial Inquiry Commission began an investigation after receiving a complaint that Kaminski was involved in an extra-marital relationship with attorney Amy Marshall. On July 16, 2019, the Office of General Counsel received a complaint filed by the Judicial Inquiry Commission alleging a number of violations of the Canons of Judicial Ethics. While engaged in the romantic relationship with Marshall, Kaminski routinely appointed Marshall to cases over which Kaminski presided and took judicial action in cases where Marshall was of counsel of record before and after the relationship became public. Kaminski subsequently admitted to violating Canons 1, 2, 2A, 2B, 2C and 3C(1) of the Canons of Judicial Ethics. As a result, Kaminski resigned his position as district court judge and agreed to never seek judicial office again.”

Use of Client Names In Attorney Marketing Materials

In July 2022, the Orange County Bar Association issued an advisory opinion that holds that client consent is required before using the name of a client in marketing materials for the lawyer’s business.

The Digest of the Opinion states: Absent informed client consent, the duty of confidentiality precludes an attorney from including on her bio or resume or in other marketing materials the names or other information about her representation of a client or former client if the listing would be embarrassing or detrimental to that client or the client requested it to be kept confidential. An attorney also may not suggest that she regularly represents a client absent that client’s informed consent. In addition, even if listing a representation would not be embarrassing or detrimental to the client, and thereby not a breach of duty of confidentiality, an attorney still would be precluded from listing the client representation if the listing is in any way misleading.

I agree with this advisory opinion. Even client’s whose cases went to trial and resulted in a verdict may not want their identity disclosed or their matter discussed. There is one caveat: if the representation results in a published opinion the lawyer can certainly discuss the opinion or list the opinion on his website or resume. What you should not do is to disclose any confidential facts about the client.

Coaching Witness By Text Message Leads to a 91-day suspension

The Supreme Court of Florida recently decided The Florida Bar v. Derek Vashon James, NO. SC20-128 (November 18, 2021). During a remote deposition, the attorney for one of the parties in a worker’s compensation proceeding coached the witness by sending text messages to the witness with suggested answers to questions. Opposing counsel noticed that the witness was reading text messages and later received some of the messages when they were inadvertently sent to her. She filed a motion for a protective order. “The judge found that the text messages were sent during the deposition, not during a break in the questioning, and that they were not protected by attorney-client privilege, contrary to Jame’s claims.”

The disciplinary referee “found that James’s texts to [the witness] while she was being questioned, telling her what to say, how to answer, to avoid providing certain information, to remember a deposition but not discuss certain checks, and to not give an absolute answer were dishonest.” p. 5. “The referee found the following aggravating factors were present: (1) dishonest or selfish motive; (2) refusal to acknowledge the wrongful nature of the conduct; and (3) substantial experience in the practice of law. In mitigation, the referee found (1) the absence of a prior disciplinary record; (2) full and free disclosure to the Bar or cooperative attitude toward the proceedings; and (3) good character or reputation.”

The referee found that the attorney had violated Rule 3.4(a) (“a lawyer must not … unlawfully obstruct another party’s access to evidence or otherwise unlawfully alter, destroy, or conceal a document….”). The Supreme Court of Florida affirmed that finding. The Supreme Court reversed the referee’s finding that the attorney had not violated Rule 8.4(d) (“a lawyer shall not engage in conduct in connection with the practice of law that is prejudicial to the administration of justice….”). The Supreme Court of Florida found that the behavior of the attorney warranted a ninety-one-day suspension.

Seventh Circuit Affirms Dismissal of Attorney’s Defamation Case

In Law Offices of David Freydin, P.C. v. Victoria Chamara, No. 18-3216 (January 28, 2022), the Seventh Circuit affirmed the dismissal of a defamation case filed by a lawyer who received negative reviews on social media pages. The post that got Freydin in trouble was, of course, on Facebook. Freydin posed the following question: “Did Trump put Ukraine on the travel ban list?! We just cannot find a cleaning lady!” Freydin made further negative comments on the Facebook post.

Freydin’s comments were not popular. Several people made negative comments on his law firm’s pages. Defendant Victoria Chamara left a one-star rating. As the court notes in its opinion, she “called Freydin an ’embarrassment and a disgrace to the US judicial system,” referred to his comments as ‘unethical and derogatory,’ and labeled him a ‘hypocrite,’ ‘chauvinist,’ and ‘racist’ who ‘has no right to practice law.'” Freydin argued that the statements were defamatory per se because they prejudiced him in his profession.

The district court dismissed the case and the Seventh Circuit affirmed that decision. The Seventh Circuit held that the comments were all statements of opinion that were not actionable.

The court noted that the phrases Freydin complained about included “terrible experience,” “awful customer service,” and “don’t waste your money.” The court concluded that there were no implied statements of fact in those statements. “First, the statements do not have precise and readily understood specific meanings. Granted, they are easily understood phrases in the English language. But there are numerous reasons why someone may have had a ‘terrible experience’ or suggest that a product or service would be a ‘waste of money.’ Without additional details, the use of these phrases cannot be understood to be ‘precise.’…Second none of the statements can be objectively verified as true or false. How could a third-party observer gauge whether the commentator received awful customer service, for instance, by just reading a one-star review that says ‘Terrible experience. Awful customer service’? What objective indicator defines whether a given customer service experience was good or bad? Or whether a service or good was worht the money?…We trust that readers of online reviews are skeptical about what they read, both positive and negative. But it is enough in this case that these short reviews did not purport to provide any factual foundation and were clearly meant to express the opinions of the defendants in response to Freydin’s insults to Ukrainians generally.”

Comment: I encourage lawyers not to respond to negative reviews. I might add to that “Do not file a defamation case against an online reviewer.” There is no reason to draw more attention to an ill-advised comment on social media. Instead, take the review in stride and suffer in silence. Devote the time you would spend on the libel case to your practice.

Ed Clinton, Jr.

Hearing Board Recommends Suspension For Poor Communication With Clients

The ARDC Hearing Board has recommended a four-month suspension for a lawyer who, it found, did not properly communicate with his clients and engaged in a conflict of interest in violation of Rule 1.7(a)(2). The lawyer represented a restaurant and four employees (servers) who were accused of violating a local ordinance. The lawyer attended a hearing and agreed to a resolution of the claims. The employees claimed that the lawyer did not have their consent to resolve the cases on their behalf.

Rule 1.7(a) provides: (a) Except as provided in paragraph (b), a lawyer shall not represent a client if the representation involves a concurrent conflict of interest. A concurrent conflict of interest exists if: (1) the representation of one client will be directly adverse to another client; or(2) there is a significant risk that the representation of one or more clients will be materially limited by the lawyer’s responsibilities to another client, a former client or a third person or by a personal interest of the lawyer.

The ARDC’s Summary stated:

“A local ordinance prohibited persons from exposing their buttocks while acting as a waiter, waitress or entertainer in a business with a liquor license. A restaurant retained Respondent to represent it and four of its servers on charges of violating that ordinance and agreed to pay any fines imposed on the servers if they were found to have violated the ordinance. Without fully informing the servers of their rights and options, Respondent entered pleas admitting that the restaurant and the servers violated the ordinance. Respondent thereby failed to properly consult with his clients concerning the objectives of the representation, failed to properly inform and explain matters to his clients, and improperly represented clients despite a conflict of interest.”

The Opinion continues to describe the testimony of the servers.

“Based on the testimony of Sarah, Briana and Allison, Morales or another manager collected their citations and told the servers they did not have to go to court. Management staff told the servers that Twin Peaks would take care of the situation and the servers would not have to deal with it. None of them ever met with Respondent or expected that anyone would admit to the charge on their behalf. Given the opportunity, Sarah, Briana and Allison each would have sought to present a defense. All three considered any violation the restaurant’s responsibility, not hers, as she was dressed as her employer required. Further, Briana was unaware of the prior police warning. Sarah testified that management told the servers to wear the lingerie despite that warning. While Allison and Briana indicated otherwise, Morales believed that all servers were clad in compliance with the ordinance, and Sarah denied that any portion of her buttocks was exposed. According to Morales, photographs of the servers with their buttocks covered depicted how they were dressed when police arrived on February 11, 2017. (Tr. 59-75, 110, 130-37, 141-43, 151, 176-78, 192, 223-25, 236-39, 317-24, 334-39; Resp. Ex. 6).

Sarah, Briana and Allison first learned that a plea of liable had been entered well after the fact. They were able to obtain information about the disposition of the citations. They were concerned about having any record of this violation and having to disclose the violation when applying for school or jobs in the future.  (Tr. 80-93, 146-47, 152, 170, 173, 325-28).

Based on Respondent’s testimony, he met with the servers on March 9, 2017, told them he represented Twin Peaks, and Twin Peaks authorized him to represent them, at no cost to them, if they did not want, or already have, another attorney. Respondent informed the servers of the March 14 court date, that there were citations against them individually and, if they wanted, they should get counsel to represent them. He told the servers they did not have to use him as their attorney. All agreed to have him represent them. (Tr. 279-83, 288-89, 512). Respondent did not inform the servers of the material risks of joint representation or advise them that they should consult with independent counsel. (Ans. at pars. 16, 17). Respondent did not believe there was any conflict of interest between Twin Peaks and the servers. He did not consider whether the servers might have a cause of action against the restaurant. (Tr. 283-86, 297, 509).

Respondent testified that, during the March 9 meeting, he told the servers that he would see if the village would dismiss the cases against them, but that would require an agreement from the village prosecutor. He recognized that was the servers’ first choice. Respondent believed that no one had any viable defense or was apt to succeed if the case went to hearing, as the police report indicated that these servers all were dressed in a way that violated the ordinance and all covered their buttocks after police issued the citations. Respondent understood that the photographs were taken after the citations were issued, not before. Respondent explained that to the servers. Respondent did not believe the servers had a defense to the citations based on lack of notice to them. While recognizing its potential as mitigation, Respondent was not certain whether the fact that the restaurant dictated the servers’ attire might have been a legal defense to the citations against the servers.

Respondent informed the servers that, if a plea had to be entered, Twin Peaks would pay any fine against them. Respondent saw that as the only real option, absent an agreement from the village prosecutor to dismiss the citations against the servers. Respondent noted that the servers were not familiar with the legal system. From his perspective, all the servers preferred to not spend money for an attorney and to avoid having to go to court or see him on an ongoing basis. Respondent thought he had the servers’ authority to enter a plea on their behalf. (Tr. 280-88, 295- 96, 510-11, 531-33, 542-43, 546-49).

Respondent did not communicate directly with any of the four servers after March 9, 2017. He relied on local managers, particularly Morales and Tony Gutierrez, to communicate with them. (Tr. 279, 288, 522-23). Respondent did not inform the servers of the status of the administrative hearings, Huguelet’s refusal to dismiss the citations against them or his negotiations with Huguelet. (Ans. at par. 20; Tr. 297). Respondent did not inform the servers that he had pled them liable to the ordinance violation, what that plea meant or the time within which to appeal. Respondent sent copies of the disposition to Gessner, but not to anyone at Twin Peaks Orland Park. (Ans. at par. 27;Tr. 292-93, 530).”

Comments: The Panel found a violation of Rule 1.7(a)(2) Conflict of Interest and recommended a four-month suspension. In other words, it was impossible for the attorney to represent both the servers and the restaurant. The restaurant’s goal was to have a speedy resolution of the municipal dispute which the lawyer obtained. The servers’ goal would have been to resist any acceptance of responsibility because it might impact their ability to obtain work in the future. The panel found that the lawyer’s representation of the servers was limited by his representation of the restaurant. The lesson here is to think carefully about conflicts of interest and to retain separate counsel for each party to the municipal proceeding.

New Jersey Opinion Construes Litigation Privilege

The New Jersey Appellate Division has issued an important and thoughtful opinion on the limits of the litigation privilege. The case is Brown v. Brown, No. A-0384-21 (February 3, 2022). The case concerns a family feud. The survivors of Michael Brown had a dispute over certain rental payments for a parcel of real property. Under a 2004 settlement, the title to the property was vested in the plaintiffs. In turn, they were obligated to “assign” to Patricia Brown the sum of $3500 a month for life. Several years later, the plaintiffs began negotiating a sale of the property. Patricia Brown filed a complaint in probate and requested the entry of an order requiring her the plaintiffs (her step children) to show cause why the 2004 settlement should not be enforced. She also recorded a lis pendens. The stepchildren then sued Patricia Brown alleging that the notice of lis pendens constituted tortious interference with an existing contractual relationship, tortious interference with a prospective economic advantage, abuse of process and malicious prosecution.

Brown moved for summary judgment arguing that the litigation privilege. The court denied summary judgment in part on the ground that the litigation privilege did not apply to the lis pendens. Brown appealed. The appellate court held that the litigation privilege did insulate Patricia Brown from the claims based on her notice of lis pendens.

The court explained “What was misconceived in the trial court was what the litigation privilege protects. The privilege does not protect a party from the tortious impact caused by a party’s prior suit; it protects only statements made during the prior suit.” Id. at 7. “It does not protect a litigant from a subsequent suit seeking redress for injuries caused by an adversary’s very act of commencing and prosecuting the earlier suit if that suit was frivolous, vexatious or tortious.” Id at 8.

As for the lis pendens, the court held that the statements contained in the lis pendens were protected by the litigation privilege. The litigation privilege, however, did not insulate a party from suit for damages caused by the filing of an “unauthorized, inaccurate, or false notice of lis pendens.”

The court held that the statements in the lis pendens were privileged. They were the equivalent of in court statements. The court affirmed the denial of summary judgment on the tortious interference claims “because the litigation privilege protects only statements made in judicial proceedings and not the commencement of frivolous, vexatious or tortious lawsuits.”

Conclusion: The litigation privilege protects the lawyer and his client from liability for statements made in court or in litigation documents. It does not protect the lawyer or the client should they choose to make an out-of-court statement. It does not provide immunity from liability for the filing of frivolous lawsuits.

Ed Clinton, Jr.