Thursday, November 10, 2016
Sanction for Frivolous Appeal Was Frivolous
Says Judge Duffy-Lewis Failed to Point to Any Frivolous Conduct And Provided No Written Recital of Bases for Penalty
By a MetNews Staff Writer
The Court of Appeal for this district has reversed a monetary sanction imposed under Code of Civil Procedure §128.5 for frivolous conduct where the trial judge failed to point to any specific conduct that was frivolous and, the appeals court said, there was none.
The opinion, which was not certified for publication, reverses an order by Los Angeles Superior Court Judge Maureen Duffy-Lewis. That order called for the international law firm of Nixon Peabody LLP, which maintains a Los Angeles office, to pay $26,320 in attorney fees to a former partner, lawyer David Tamman.
Tamman is presently appealing his conviction in federal court for crimes committed in the course of covering up a client’s $22 million Ponzi scheme.
The opinion, filed Tuesday, notes that it is unclear from Duffy-Lewis’s order whether the sanction was imposed solely on Nixon Peabody, or also on the law firm representing it, Hill, Farrer & Burrill.
Basis of Lawsuit
Tamman is suing Nixon Peabody for having allegedly counselled him to commit the conduct which caused him to come under investigation by the Securities and Exchange Commission, and then turning on him once the spotlight was cast on his activities. He states various causes of action, including breach of contract, breach of fiduciary duty, and intentional interference with business relations.
The sanction was based on Nixon Peabody having appealed Duffy-Lewis’s Sept. 9, 2013 denial of its anti-SLAPP motion. That appeal was rebuffed by the Court of Appeal on Sept. 30, 2014, in an unpublished opinion and, on remand, Duffy-Lewis imposed the sanction on Aug. 13, 2015.
On Tuesday, Div. Two of this district’s appeals court—the panel that had affirmed the denial of the anti-SLAPP motion—reversed the sanction order.
Acting Presiding Justice Judith Ashmann-Gerst noted that the trial court did not make the requisite “finding of frivolousness,” adding that “we do not think it could.”
She said that “[w]hile Nixon Peabody did not prevail” in the prior appeal, the anti-SLAPP motion it was pursuing “was not frivolous.” The contention that its conduct arose from protected litigation-related activity “was not completely devoid of merit,” Ashmann-Gerst declared.
Written Factual Recital
The jurist continued that Duffy-Lewis failed to issue “a written factual recital, with reasonable specificity, of the circumstances that led the trial court to find the conduct before it sanctionable,” as required by case law.
Ashmann-Gerst said that the doctrine of “law of the case” does not justify the award, explaining:
“While our opinion in the prior appeal highlights why we were affirming the trial court’s order, nothing therein held that Nixon Peabody acted frivolously in pursuing the anti-SLAPP motion.”
Kevin H. Brogan, Dean E. Dennis, and William A. Meyers of Hill, Farrer & Burrill argued for reversal. Tamman was represented by James P. Wohl Stanton and Stanton Lee Phillips.
On Nov. 13, 2012, Tamman was convicted in U.S. District Court for the Central District of California of obstruction of justice, conspiracy to obstruct justice, aiding and abetting the destruction, alteration or falsification of records, being an accessory after the fact to mail fraud, use of mail or interstate commerce for unregistered securities, securities fraud, and aiding and abetting witness tampering.
He was sentenced on Sept. 23, 2013 to seven years in prison. On April 3, 2015, the Ninth U.S. Circuit Court of Appeals affirmed the conviction, rejecting his contention that District Judge Philip Gutierrez erred in accepting his waiver of a jury trial.
Tamman has been on interim suspension since Feb. 18, 2013. On Aug. 3, 2016, the State Bar Court recommended that he be summarily disbarred.
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