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Ford Accuses Firms, Lawyers of RICO Violations
Seeks Treble Damages of ‘at Least’ $300 Million
By a MetNews Staff Writer
Ford Motor Company yesterday filed as complaint in the U.S. District Court for the Central District of California accusing three law firms and six lawyers of cheating it and other auto-makers of “at least $100 million” through phony billings, pointing to one case in which a lawyer’s time sheets reflected a claim to having worked 57.5 hours in a single day.
Treble damages are sought in the action, brought under the Racketeering Influenced and Corrupt Organizations Act (“RICO”).
Names as defendants are Knight Law Group LLP and Steve B. Mikhov, its founding partner who now resides in Puerto Rico, partners Amy Morse, and Roger Kirnos, and Dorothy Becerra, a former paralegal there; The Altman Law Group and its founder and a former member of the firm, Bryan C. Altman; and Wirtz Law APC and its founder/managing attorney, Richard Wirtz.
Massive Scheme Alleged
The complaint sets forth that “[t]This case arises out of a massive and years-long scheme by Defendants to defraud auto manufacturers, including Ford, out of money and property by falsely and fraudulently inflating their legal fees under California’s Lemon Law,” by which the Song-Beverly Consumer Warranty Act (Civil Code §1790 et seq.) is commonly referred.
Sec. 1794(e)(1) says that where there is a violation of the repair/replace/or refund provisions, “the buyer shall recover damages and reasonable attorney’s fees and costs.”
The complaint continues:
“The scheme was carried out through a sophisticated criminal enterprise of attorneys and law firms that ingeniously spread their fraudulent billings across thousands of cases against many auto manufacturers so that their fraudulent scheme would go undetected. Indeed, but for the tremendous expense incurred by Ford to audit and detect the fraud, this criminal enterprise would have continued unabated. Ford brings this suit to end this wide-ranging and corrupt scheme to claim thousands of hours in fictitious billings for time never worked.”
Mikhov Termed ‘Ringleader’
The pleading explains:
“To effectuate this scheme. Defendants submitted false and inflated fee applications and fee demands based on wholly fictitious work and time entries. The ringleader of the criminal enterprise, Steve Mikhov and his law firm, Knight Law Group, orchestrated this scheme to take advantage of generous remedies offered by California’s Lemon Law at the expense of auto manufacturers including Ford. Ford has identified hundreds of cases in which not less than $100 million of legal bills were unlawfully sought and collected. A review of fee claims in multiple cases takes one on a magical mystery tour of fictitious billings, including individual attorneys who supposedly worked more than 24 hours per day or simultaneously attended different trials or depositions in geographically distant jurisdictions.”
Morse is identified as the lawyer who, on Nov. 30, 2016, purportedly worked 57.5 hours within a 24-hour period. Non-defendant Kristina Stephenson-Cheang, an associate at Knight Law Group, is said to have billed for 34.1 hours on July 6, 2017.
Lying, Hoodwinking Asserted
The pleading avers:
“Defendants concealed their fraudulent scheme by lying and by spreading their fee claims across numerous matters involving different California courts, cases, and car company defendants. In so doing, they hoodwinked all of the judges and lawyers who were privy only to information presented in individual cases. However, when the Defendants’ fee applications in numerous cases involving many clients are analyzed by cross-referencing different matters against different car manufacturers to track the claimed time entries for each lawyer in the criminal enterprise for each day over several years, the Defendants’ massive false, fraudulent, and inflated billings are clear and unmistakable.”
The defendants are accused of violating RICO and being engaged in a conspiracy to violate RICO.
Knight Law Group has offices in Century City and elsewhere; The Altman Law Group has its offices in Westwood; the Wirtz Law APC has offices in Westwood and elsewhere.
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