Articles Posted in Legal Ethics

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The Eighth Circuit vacated the district court's order directing Pfizer to pay attorney's fees in an order remanding to state court. The Eighth Circuit agreed with plaintiffs that the filing of the satisfaction of judgment has mooted the appeal, and vacated the district court's order directing Pfizer to pay attorney's fees given an order of vacatur was the usual course, that all parties agree that vacatur was proper, and that vacatur would go a long way toward repairing any possible harm that Pfizer claimed it suffered. The court reasoned that otherwise the prevailing party could solidify a decision as precedent or create a preclusive effect without that decision being subjected to appellate review. View "Robinson v. Pfizer, Inc." on Justia Law

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Plaintiffs Dindinger, Loring, and Freund filed suit against Allsteel, alleging claims of sex-based wage discrimination under the Equal Pay Act, 29 U.S.C. 206(d); Dindinger and Loring also brought claims of sex-based wage discrimination under the Iowa Civil Rights Act, Iowa Code 216.6A, and Title VII of the Civil Rights Act, 42 U.S.C. 2000e; and Loring additionally brought a claim of sex-based discrimination for failure to promote under Title VII. On appeal, Allsteel challenged the district court's denial of its motion for a new trial and grant of plaintiffs' motions for attorney's fees and costs. The court concluded that the district court correctly instructed the jury that Allsteel could not rely on economic conditions to establish its affirmative defense to the Equal Pay Act claim that a factor other than sex justified the pay discrepancies between plaintiffs and their male comparators; even if the court were to agree that economic conditions could be a factor other than sex justifying a pay differential in some circumstances, Allsteel did not present evidence to establish such a defense here; and because Allsteel did not present evidence that economic conditions caused the pay differentials plaintiffs experienced, the district court did not abuse its discretion in instructing the jury that Allsteel could not rely on economic conditions to establish an affirmative defense. The court also concluded that the district court did not abuse its discretion by admitting "me-too" evidence; limiting Allsteel's ability to offer evidence regarding the audit; and by admitting testimony from Loring's supervisor. Finally, the court concluded that the district court did not abuse its discretion in regard to attorney's fees, but remanded the issue of costs with instructions to determine whether charging clients separately for Westlaw research is the prevailing practice in Iowa. Accordingly, the court remanded as to this issue and affirmed in all other respects. View "Dindinger v. Allsteel, Inc." on Justia Law

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This class action against Wells Fargo involved claims related to the bank's practice of automatically ordering and charging fees for property inspections when customers fell behind on their mortgage payments. On appeal, objectors challenged the district court's award of attorneys' fees in the amount of one-third of the total settlement fund in the class action settlement. The court concluded that the district court did not abuse its discretion by basing its fee award on the total settlement fund, which included administrative costs. The court also concluded that the district court did not abuse its discretion in approving the total amount of attorneys' fees and the amount was reasonable because the district court did not err in concluding that the circumstances of this case justified a large award; under the percentage-of-the-benefit method, the award was in line with other awards in the Eighth Circuit; and the district court verified the reasonableness of its award by cross-checking it against the lodestar method. Accordingly, the court affirmed the judgment. View "Huyer v. Buckley" on Justia Law

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This appeal stems from a class action settlement where Life Time agreed to pay $10-15 million to settle claims that the company violated the Telephone Consumer Protection Act (TCPA), 47 U.S.C. 227. Objector challenges the district court's order awarding class counsel $2.8 million in attorney's fees and expenses. The court concluded that the district court's analysis was thorough, its findings were amply supported, and it did not abuse its significant discretion by electing to use the percentage-of-the-benefit method to calculate the fee award or by determining that an award of $2.8 million in attorney’s fees and expenses was reasonable. Furthermore, the district court did not abuse its discretion by including approximately $750,000 in fund administration costs as part of the "benefit" when calculating the percentage-of-the-benefit fee amount; nor did the district court abuse its discretion by allowing class counsel themselves to determine how to allocate the total $2.8 million attorney's fee award without further judicial oversight or approval. Accordingly, the court affirmed the judgment. View "Thut v. Life Time Fitness, Inc." on Justia Law

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A common-benefit trust fund was established to compensate attorneys leading the MDL concerning Bayer’s LibertyLink LL601 genetically modified rice. On appeal, Bayer and Riceland challenge the district court's order requiring Bayer to cause the deposit of a portion of a settlement between Bayer and Riceland into the fund. Bayer and Riceland argue that because their settlement was the product of negotiations following a state-court judgment, the district court lacked jurisdiction to order Bayer to cause a percentage of the settlement to be deposited into the fund. The court concluded that the district court properly ordered Bayer to hold back a portion of the Bayer-Riceland settlement. In this case, application of the Common Benefit Order was a comparable collateral matter that the district court had jurisdiction to resolve in light of the settlement; the district court properly applied the Common Benefit Order to the settlement and required a percentage of the entire settlement to be redirected to the common-benefit fund; and the district court did not plainly err in assigning to Bayer the duty of causing a deposit of the funds due under the Common Benefit Order. Accordingly, the court affirmed the judgment. View "Riceland Foods v. Bayer Cropscience US" on Justia Law

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Plaintiffs filed suit alleging that 21 Budget rental car businesses willfully violated the Fair and Accurate Credit Transactions Act (FACTA), 15 U.S.C. 1681c(g)(1), by issuing receipts that contained more than five digits of customers’ credit card numbers. The parties subsequently mediated and agreed on a proposed settlement. The settlement provided that each class member would receive a certificate worth $10 off any car rental or $30 off a rental over $150, with no holiday blackout days. Applying the Class Action Fairness Act (CAFA), 28 U.S.C. 1712(a)-(c), the district court awarded $23,137.46 in attorneys’ fees and costs, and a $1,000 class representative incentive fee. Plaintiffs appealed. The court concluded that the district court erred by following the In re HP Inkjet Printer Litig. mandatory approach in applying section 1712(a)-(c) without explicitly stating that the award was based on an exercise of the district court’s discretion to determine a reasonable attorney’s fee. But plaintiffs do not argue the award was a breach of the district court’s discretion, and if the court remanded, it would be for an explicit exercise of that discretion, applying the principles of section 1712(a)-(c). The court determined that any award greater than $17,438.45 would be unreasonable in light of class counsel’s limited success in obtaining value for the class. Accordingly, the court concluded that any error was harmless and affirmed the judgment. View "Galloway v. The Kansas City Landsmen, LLC" on Justia Law

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The Trusts filed suits in federal and state court over the course of two-and-a-half decades, claiming rights as the beneficiaries, successors, or assigns of the owners of coal mining royalty interests in Kentucky. In this case, the Trusts sued their former attorneys, alleging legal malpractice based on the adverse outcome of one of these cases. The district court dismissed the complaint. The court rejected the Trusts' assertion that the attorneys committed malpractice by failing to raise preclusion arguments based on the outcome of a prior case. The court agreed with the district court that the proffered argument would not have changed the outcome in Willits II. The court concluded that the Trusts have not stated a malpractice claim based on failure to press this preclusion theory in Willits II. The court also rejected the Trusts' assertion that the attorneys committed malpractice by failing to raise certain constitutional arguments at an earlier phase. The court agreed with the district court that the constitutional arguments lack merit. Accordingly, the court affirmed the judgment. View "The PPW Royalty Trust v. Barton" on Justia Law

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Larry and Elaine, husband and wife, filed suit in Iowa state court in 2008 against multiple parties, including defendant, whom they claimed was negligent in his pre-bankruptcy and bankruptcy-planning advice. The jury found in favor of defendant and warded him a $12,200 judgment. In 2013, the Iowa Court of Appeals affirmed the award of unpaid legal fees. Larry and Elaine then filed this action in 2014, alleging that defendant was negligent in advising them regarding their bankruptcy, and that their sons acted in concert with Putnam to close the bankruptcy through the Settlement Agreement with the bankruptcy trustee. The district court determined that the jury verdict in the prior case disposed of all issues in the instant case but one: the alleged failure of Putnam to protect Larry and Elaine’s interests when the bankruptcy was closed. The court held that Larry and Elaine's claim is barred by res judicata. Larry and Elaine’s claim in the instant action relates to the same cause of action that was adjudicated to a final judgment on the merits in the first malpractice case, and Larry and Elaine have failed to show that their claim could not have been fully and fairly adjudicated in the first action. Accordingly, the court affirmed the judgment. View "Schaefer v. Putnam" on Justia Law

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Larkin moved to withdraw as counsel of Maid-Rite and two of the company's employees, after the franchisor failed to pay for its legal fees and to provide important information related to its defense. The district court denied Larkin's motion. The court concluded that, based on the record, it was presumptively appropriate for Larkin to seek withdrawal where defendants' failure to provide the firm with important information related to their defense also failed to fulfill an obligation to the firm. Further, defendants were warned several times and notified about the motion to withdraw. The court also concluded that defendants were not prejudiced by the withdrawal nor were third parties prejudiced by the withdrawal. Accordingly, the court reversed and remanded. View "Sanford v. Larkin Hoffman Daly & Lindgren" on Justia Law

Posted in: Legal Ethics

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Plaintiff, a member of the Westboro Baptist Church, filed suit in 2006 against Missouri state and state officials after the Missouri General Assembly enacted statewide restrictions on pickets and protests near funerals and funeral processions. In 2014, Missouri appealed the statute at issue while plaintiff's Rule 59(e) motion remained pending in district court. In this appeal, plaintiff challenged the district court's adverse judgments on her due process claim as well as the court's award of attorneys' fees. The court vacated the district court's judgment on the due process claim and remanded with instructions to dismiss her claim as moot. In regard to the attorneys' fees, the court concluded that the district court's 2/14th calculation was an abuse of discretion because its arithmetically simplistic fee calculation did not accurately reflect her degree of success of her interrelated claims. Moreover, even if the court accepted the district court's basic mathematical approach, its 2/14th calculation is inaccurate because it did not address whether it counted consent judgments, mooted claims, and dismissed claims as prevailing, neutral, or unsuccessful claims. Accordingly, the court reversed the district court's award of attorneys' fees. View "Phelps-Roper v. Koster" on Justia Law