ILNews

Appeal moot, but attorney fees allowed

Jennifer Nelson
January 1, 2008
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The Indiana Court of Appeals dismissed an appeal as moot but awarded the defendant appellate attorney fees and costs because the plaintiff engaged in procedural and substantive bad faith during the appeals process.

In Samuel Lesjak v. New England Financial, No. 29A02-0706-CV-499, Lesjak appealed the trial court's order that he arbitrate a claim filed against him by New England Financial in a forum other than the National Association of Securities Dealers. Lesjak worked for New England Securities as a broker/dealer. He registered with NASD to be able to buy and sell securities to the public. The agreement he signed when he was hired stated Lesjak would agree to arbitrate through NASD any dispute or claim that may arise between himself and New England Securities.

Lesjak had an assistant, whose salary was reimbursed by New England Securities. After Lesjak quit, the company sought the return of past payments to Lesjak for his assistant's salary in the sum of more than $24,000.

New England Financial filed a complaint against Lesjak to recoup the money. A letter attached to the complaint stated New England Financial is not a legal entity and is the service mark for New England Life Insurance Co. The complaint never stated which company was suing Lesjak.

Lesjak tried to arbitrate the claim through NASD, but New England Financial opposed it. The trial court ordered the parties to submit the matter to NASD arbitration, but eventually granted New England Financial's motion for a stay of proceedings because New England Financial is not a member of NASD and cannot arbitrate through them. The court ordered Lesjak to arbitrate the matter through another forum besides NASD. Lesjak appealed, and New England Financial was granted a motion to hold the appeal in abeyance. New England Financial explained that NASD, now the Financial Industry Regulatory Authority, agreed to arbitrate the claim and this appeal should not move forward.

Lesjak filed a motion in opposition to holding the appeal in abeyance and sought a request for damages. He contended that because New England Financial acted with both procedural and substantive bad faith he should be awarded damages.

New England Financial missed the date on which to file a brief and was not granted an extension. The company filed its brief a week later and filed a motion to include documents outside of the clerk's record in its appendix.

The core issue of the appeal - whether the trial court properly ordered the matter be arbitrated, but not before NASD - is moot because arbitration is under way, wrote Chief Judge John Baker. However, the appellate court denied New England Financial's motions for extension of time to file its brief and to include documents outside of the clerk's record in its appendix. New England Financial was told it was required to file its brief by Nov. 13, 2007, and no extensions would be granted.

Chief Judge Baker wrote that based on New England Financial's actions during litigation of this case and the appeal, New England Financial clearly engaged in both procedural and substantive bad faith during the appeal, if not the entire litigation. The company fought for months to not arbitrate the claim and claimed arbitration with NASD would be impossible because New England Financial was not an NASD member, but the company then suddenly said arbitration would be accepted.

Lesjak has spent more than $19,000 in attorney fees seeking arbitration. He has established he is entitled to appellate attorney fees and costs pursuant to Appellate Rule 66(E) because of New England's bad faith during this appeal.

The case is remanded to the trial court for a calculation of the amount of attorney fees and costs Lesjak is entitled to and for the trial court to consider if Lesjak is entitled to attorney fees for New England Financial's conduct prior to this appeal.
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  1. Yes diversity is so very important. With justice Rucker off ... the court is too white. Still too male. No Hispanic justice. No LGBT justice. And there are other checkboxes missing as well. This will not do. I say hold the seat until a physically handicapped Black Lesbian of Hispanic heritage and eastern religious creed with bipolar issues can be located. Perhaps an international search, with a preference for third world candidates, is indicated. A non English speaker would surely increase our diversity quotient!!!

  2. First, I want to thank Justice Rucker for his many years of public service, not just at the appellate court level for over 25 years, but also when he served the people of Lake County as a Deputy Prosecutor, City Attorney for Gary, IN, and in private practice in a smaller, highly diverse community with a history of serious economic challenges, ethnic tensions, and recently publicized but apparently long-standing environmental health risks to some of its poorest residents. Congratulations for having the dedication & courage to practice law in areas many in our state might have considered too dangerous or too poor at different points in time. It was also courageous to step into a prominent and highly visible position of public service & respect in the early 1990's, remaining in a position that left you open to state-wide public scrutiny (without any glitches) for over 25 years. Yes, Hoosiers of all backgrounds can take pride in your many years of public service. But people of color who watched your ascent to the highest levels of state government no doubt felt even more as you transcended some real & perhaps some perceived social, economic, academic and professional barriers. You were living proof that, with hard work, dedication & a spirit of public service, a person who shared their same skin tone or came from the same county they grew up in could achieve great success. At the same time, perhaps unknowingly, you helped fellow members of the judiciary, court staff, litigants and the public better understand that differences that are only skin-deep neither define nor limit a person's character, abilities or prospects in life. You also helped others appreciate that people of different races & backgrounds can live and work together peacefully & productively for the greater good of all. Those are truths that didn't have to be written down in court opinions. Anyone paying attention could see that truth lived out every day you devoted to public service. I believe you have been a "trailblazer" in Indiana's legal community and its judiciary. I also embrace your belief that society's needs can be better served when people in positions of governmental power reflect the many complexions of the population that they serve. Whether through greater understanding across the existing racial spectrum or through the removal of some real and some perceived color-based, hope-crushing barriers to life opportunities & success, movement toward a more reflective representation of the population being governed will lead to greater and uninterrupted respect for laws designed to protect all peoples' rights to life, liberty & the pursuit of happiness. Thanks again for a job well-done & for the inevitable positive impact your service has had - and will continue to have - on countless Hoosiers of all backgrounds & colors.

  3. Diversity is important, but with some limitations. For instance, diversity of experience is a great thing that can be very helpful in certain jobs or roles. Diversity of skin color is never important, ever, under any circumstance. To think that skin color changes one single thing about a person is patently racist and offensive. Likewise, diversity of values is useless. Some values are better than others. In the case of a supreme court justice, I actually think diversity is unimportant. The justices are not to impose their own beliefs on rulings, but need to apply the law to the facts in an objective manner.

  4. Have been seeing this wonderful physician for a few years and was one of his patients who told him about what we were being told at CVS. Multiple ones. This was a witch hunt and they shold be ashamed of how patients were treated. Most of all, CVS should be ashamed for what they put this physician through. So thankful he fought back. His office is no "pill mill'. He does drug testing multiple times a year and sees patients a minimum of four times a year.

  5. Brian W, I fear I have not been sufficiently entertaining to bring you back. Here is a real laugh track that just might do it. When one is grabbed by the scruff of his worldview and made to choose between his Confession and his profession ... it is a not a hard choice, given the Confession affects eternity. But then comes the hardship in this world. Imagine how often I hear taunts like yours ... "what, you could not even pass character and fitness after they let you sit and pass their bar exam ... dude, there must really be something wrong with you!" Even one of the Bishop's foremost courtiers said that, when explaining why the RCC refused to stand with me. You want entertaining? How about watching your personal economy crash while you have a wife and five kids to clothe and feed. And you can't because you cannot work, because those demanding you cast off your Confession to be allowed into "their" profession have all the control. And you know that they are wrong, dead wrong, and that even the professional code itself allows your Faithful stand, to wit: "A lawyer may refuse to comply with an obligation imposed by law upon a good faith belief that no valid obligation exists. The provisions of Rule 1.2(d) concerning a good faith challenge to the validity, scope, meaning or application of the law apply to challenges of legal regulation of the practice of law." YET YOU ARE A NONPERSON before the BLE, and will not be heard on your rights or their duties to the law -- you are under tyranny, not law. And so they win in this world, you lose, and you lose even your belief in the rule of law, and demoralization joins poverty, and very troubling thoughts impeaching self worth rush in to fill the void where your career once lived. Thoughts you did not think possible. You find yourself a failure ... in your profession, in your support of your family, in the mirror. And there is little to keep hope alive, because tyranny rules so firmly and none, not the church, not the NGO's, none truly give a damn. Not even a new court, who pay such lip service to justice and ancient role models. You want entertainment? Well if you are on the side of the courtiers running the system that has crushed me, as I suspect you are, then Orwell must be a real riot: "There will be no curiosity, no enjoyment of the process of life. All competing pleasures will be destroyed. But always — do not forget this, Winston — always there will be the intoxication of power, constantly increasing and constantly growing subtler. Always, at every moment, there will be the thrill of victory, the sensation of trampling on an enemy who is helpless. If you want a picture of the future, imagine a boot stamping on a human face — forever." I never thought they would win, I always thought that at the end of the day the rule of law would prevail. Yes, the rule of man's law. Instead power prevailed, so many rules broken by the system to break me. It took years, but, finally, the end that Dr Bowman predicted is upon me, the end that she advised the BLE to take to break me. Ironically, that is the one thing in her far left of center report that the BLE (after stamping, in red ink, on Jan 22) is uninterested in, as that the BLE and ADA office that used the federal statute as a sword now refuses to even dialogue on her dire prediction as to my fate. "C'est la vie" Entertaining enough for you, status quo defender?

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