Metropolitan News-Enterprise


Wednesday, April 19, 2023


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Ninth Circuit Affirms Dismissal of Action by Lawyer Raising Issues Decided in State Court


By a MetNews Staff Writer


The Ninth U.S. Circuit Court of Appeals yesterday affirmed the dismissal of an action filed by a Los Angeles attorney against a law firm and others, holding that the matters of which he complains were resolved by California’s Court of Appeal which affirmed the imposition of a $22,159.50 sanction on him.

Attorney Michael Mogan, who also practices in Illinois, is presently facing disciplinary charges in California’s State Bar Court based on failing to pay the sanction and on the conduct which led to it.

Mogan represented Veronica McCluskey in action filed against Airbnb, an online marketplace, and some of its employees.  The action was ordered to arbitration; the American Arbitration Association notified the partiers that Airbnb had failed to pay the arbitration; it then advised the parties that there had been a clerical error and that the fee had been paid and the arbitration could commence.

Nonetheless, Mogan moved for an order lifting the stay of court proceedings; San Francisco Superior Court Judge Ethan P. Schulman found the motion “factually and legally frivolous” and imposed the sanction, reflecting the attorney fees that were incurred by the defendants in opposing the request to lift the stay. Div. Three of the First District Court of Appeal on Nov. 2, 2020, affirmed, declaring that “Mogan fails to demonstrate any reason to reverse the sanctions order.”

Mogan then brought suit in the U.S. District Court for the Eastern District of California against Sacks, Ricketts & Case, LLP, the law firm (now disbanded) that represented the defendants in the state action, certain of its members, and the defendants in that action. Magistrate Judge Thomas S. Hixson dismissed the action and ordered Mogan to pay attorney fees in the amount of $16,399.00 and $1,687.50 in costs.

Ninth Circuit Opinion

Affirmance came yesterday in a memorandum opinion signed by Ninth Circuit Judge Holly A. Thomas, Ninth Circuit Senior Judge Sidney Thomas, and District Court Judge Jed S. Rakoff of the Southern District of New York, sitting by designation.

The claim against the law firm and its members, they said, “is plainly barred by California’s litigation privilege, because it consists entirely of lawful communications made in furtherance of litigation and arbitration proceedings.” They declared that Hixson “did not err in dismissing Mogan’s claims” as to Airbnb and its employees “on collateral estoppel grounds” because the issues presented in the District Court action were finally adjudicated in the state proceedings.

The judges added:

“Mogan’s contention that the sanctions proceedings deprived him of due process is also meritless, as he was given full notice of the basis for sanctions in the motion briefing and was provided an opportunity to respond.”

There was no abuse of discretion in setting the amount of the fees, they added.

The case is Mogan v. Sacks, Ricketts & Case, LLP, 22-15254.

State Bar Proceedings

The Office of Chief Counsel in its Feb. 6 notice of State Bar disciplinary charges says Mogan disobeyed a court order by failing to pay the $22,159.50 sanction imposed by the San Francisco Superior Court and maintained an unjust action by seeking the lifting of the stay, it alleges, with paragraph numbers removed:

“In its order, the court found the respondent’s motion to be both factually and legally frivolous.

“Respondent appealed the sanctions order and on November 11, 2020, the Court of Appeal affirmed the sanctions order and indicated that close to all of respondent’s 19 arguments in the appeal were equally frivolous.

“By filing a frivolous motion to lift stay in the above-referenced proceeding and thereafter appealing the trial court’s denial of said motion on equally frivolous grounds, respondent failed to counsel or maintain such action, proceedings, or defenses only as they appear to be legal or just in willful violation of Business and Professions Code section 6068(c).”

Mogan, who has an office in Chicago, says in his response:

“Respondent DENIES that he disobeyed or violated an order as the Bankruptcy Court for the Northern District of Illinois has jurisdiction over the full $22,159.50 monetary sanctions effective February 19, 2022.”

He adds:

“There was also no due date set in the September 11, 2019 sanctions order and such order was reduced to a judgment on or about September 12, 2019 such judgment also set no due date for payment thus it is solely governed by California law governing judgments.”

Mogan asserts that the Court of Appeal’s opinion was predicated on material mistakes of law and misstated the facts. Twenty-four affirmative defenses are set forth.


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