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Sanctioned firm settles on legal fees

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An Indianapolis law firm sanctioned for the conduct of some of its attorneys in an environmental cleanup case won't appeal the sanction and has agreed to pick up some of the opposing counsel's legal tab as part of a settlement agreement.

With a settlement reached late Friday, Bose McKinney & Evans has agreed to pay an unspecified amount of legal fees as a result of the June 5 order from U.S. District Judge Larry McKinney, who determined the firm should be sanctioned for essentially helping its client abuse the discovery process, failing to correct misleading or false statements made by the client, and not properly turning over to the court or opposing counsel key documents relating to the case.

Notice of a settlement was filed with the court on Friday, saying the parties, "resolved the issues between them, including the relief the Court granted to 1100 West as against BME."

In a statement from managing partner Kendall C. Crook, he says the firm is pleased with being able to resolve its differences in a "mutually satisfactory manner," but doesn't delve into specifics of the agreement reached in 1100 West LLC v. Red Spot Paint & Varnish Co., 1:05-CV-1670.

The case involves a business's 7-acre site in the Evansville area that it claims was heavily contaminated with toxic chemicals from the nearby Red Spot property. The plaintiff asked the judge to order the removal of all the chemicals near its property and for the company to stop discharging hazardous and solid waste from its nearby property, and a central issue in the case was whether particular chemicals were used at the site. Red Spot denied that they were stored or used there, but Judge McKinney determined otherwise based on discovery initially withheld from the court and opposing counsel.

Specifically, the judge's order focused on former Bose attorneys Richard VanRheenen and Amy Cueller, who firm leaders asked to leave late last year because of this case. A declaration submitted by Crook shows that VanRheenen voluntarily resigned his partnership effective Jan. 1, 2009, and remained on a limited contract attorney basis until Feb. 20 to transition his practice and clients to a new firm; Cueller declined to resign and was fired Jan. 6.

Others mentioned include partner Kathleen Lucas, who remains at the firm; former associate Matthew Klein and former partner Jan Nelson, both of whom are no longer listed on the firm's Web site; and an unnamed paralegal who assisted on the case.

Aside from the firm sanctions, Judge McKinney entered a default judgment against Red Spot and determined the company had forfeited the right to have these issues determined on the merits.

In his 66-page order, Judge McKinney wrote that 1100 West was entitled to attorneys' fees and costs from all discovery dating back to May 23, 2006, and for all the costs associated with the sanctions' motions and hearings. Bose was ordered to pay half those costs, splitting the tab with Red Spot.

While details of the settlement are confidential, the costs are expected to run into the millions. Firm spokesman Roger Harvey, senior vice president of Bose Public Affairs Group, declined to discuss details but said this settlement resolves all issues so there will be no appeal by the firm.

"We won't let this define us," he said. "The true test of an organization is its ability to recover from an unfortunate situation like this, and we're certainly committed to doing that."

Court documents show that Red Spot has argued that Bose McKinney & Evans collected almost $3 million in legal fees on this case and that the firm threw its former client "under the bus" in an effort to distract the court from its own misconduct, while the firm says that Red Spot's continued evasion of the truth shows that the client was the problem, not the attorneys.

Lead counsel for 1100 West, Tom Barnard with Taft Stettinius & Hollister, said that this settlement doesn't end the case against Red Spot, which has new counsel after Bose McKinney & Evans stepped down from that role earlier this year. The company is now represented by attorneys at Indianapolis-based Ice Miller and two out-of-state firms, Michigan's Butzel Long and Chicago's Foley & Lardner.

Barnard says that Judge McKinney's order allows 1100 West to move forward with a remediation plan and determine what the cost will be for cleanup. That proposed plan is due Aug. 4, and a show cause hearing is set for Nov. 4.

He declined to discuss specifics of the settlement or comment on sanctions against the entire firm - something that plaintiffs did not request from the judge in this case. But he said he hopes the default judgment and fees sanction against Red Spot will move the case along.

"This has been a remarkably frustrating process for me as a trial lawyer, and it was unfortunate for us to have to seek sanctions," he said. "But sometimes those are the only mechanisms left to obtain justice."

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  1. I like the concept. Seems like a good idea and really inexpensive to manage.

  2. I don't agree that this is an extreme case. There are more of these people than you realize - people that are vindictive and/or with psychological issues have clogged the system with baseless suits that are costly to the defendant and to taxpayers. Restricting repeat offenders from further abusing the system is not akin to restricting their freedon, but to protecting their victims, and the court system, from allowing them unfettered access. From the Supreme Court opinion "he has burdened the opposing party and the courts of this state at every level with massive, confusing, disorganized, defective, repetitive, and often meritless filings."

  3. So, if you cry wolf one too many times courts may "restrict" your ability to pursue legal action? Also, why is document production equated with wealth? Anyone can "produce probably tens of thousands of pages of filings" if they have a public library card. I understand this is an extreme case, but our Supreme Court really got this one wrong.

  4. He called our nation a nation of cowards because we didn't want to talk about race. That was a cheap shot coming from the top cop. The man who decides who gets the federal government indicts. Wow. Not a gentleman if that is the measure. More importantly, this insult delivered as we all understand, to white people-- without him or anybody needing to explain that is precisely what he meant-- but this is an insult to timid white persons who fear the government and don't want to say anything about race for fear of being accused a racist. With all the legal heat that can come down on somebody if they say something which can be construed by a prosecutor like Mr Holder as racist, is it any wonder white people-- that's who he meant obviously-- is there any surprise that white people don't want to talk about race? And as lawyers we have even less freedom lest our remarks be considered violations of the rules. Mr Holder also demonstrated his bias by publically visiting with the family of the young man who was killed by a police offering in the line of duty, which was a very strong indicator of bias agains the offer who is under investigation, and was a failure to lead properly by letting his investigators do their job without him predetermining the proper outcome. He also has potentially biased the jury pool. All in all this worsens race relations by feeding into the perception shared by whites as well as blacks that justice will not be impartial. I will say this much, I do not blame Obama for all of HOlder's missteps. Obama has done a lot of things to stay above the fray and try and be a leader for all Americans. Maybe he should have reigned Holder in some but Obama's got his hands full with other problelms. Oh did I mention HOlder is a bank crony who will probably get a job in a silkstocking law firm working for millions of bucks a year defending bankers whom he didn't have the integrity or courage to hold to account for their acts of fraud on the United States, other financial institutions, and the people. His tenure will be regarded by history as a failure of leadership at one of the most important jobs in our nation. Finally and most importantly besides him insulting the public and letting off the big financial cheats, he has been at the forefront of over-prosecuting the secrecy laws to punish whistleblowers and chill free speech. What has Holder done to vindicate the rights of privacy of the American public against the illegal snooping of the NSA? He could have charged NSA personnel with violations of law for their warrantless wiretapping which has been done millions of times and instead he did not persecute a single soul. That is a defalcation of historical proportions and it signals to the public that the government DOJ under him was not willing to do a damn thing to protect the public against the rapid growth of the illegal surveillance state. Who else could have done this? Nobody. And for that omission Obama deserves the blame too. Here were are sliding into a police state and Eric Holder made it go all the faster.

  5. JOE CLAYPOOL candidate for Superior Court in Harrison County - Indiana This candidate is misleading voters to think he is a Judge by putting Elect Judge Joe Claypool on his campaign literature. paragraphs 2 and 9 below clearly indicate this injustice to voting public to gain employment. What can we do? Indiana Code - Section 35-43-5-3: Deception (a) A person who: (1) being an officer, manager, or other person participating in the direction of a credit institution, knowingly or intentionally receives or permits the receipt of a deposit or other investment, knowing that the institution is insolvent; (2) knowingly or intentionally makes a false or misleading written statement with intent to obtain property, employment, or an educational opportunity; (3) misapplies entrusted property, property of a governmental entity, or property of a credit institution in a manner that the person knows is unlawful or that the person knows involves substantial risk of loss or detriment to either the owner of the property or to a person for whose benefit the property was entrusted; (4) knowingly or intentionally, in the regular course of business, either: (A) uses or possesses for use a false weight or measure or other device for falsely determining or recording the quality or quantity of any commodity; or (B) sells, offers, or displays for sale or delivers less than the represented quality or quantity of any commodity; (5) with intent to defraud another person furnishing electricity, gas, water, telecommunication, or any other utility service, avoids a lawful charge for that service by scheme or device or by tampering with facilities or equipment of the person furnishing the service; (6) with intent to defraud, misrepresents the identity of the person or another person or the identity or quality of property; (7) with intent to defraud an owner of a coin machine, deposits a slug in that machine; (8) with intent to enable the person or another person to deposit a slug in a coin machine, makes, possesses, or disposes of a slug; (9) disseminates to the public an advertisement that the person knows is false, misleading, or deceptive, with intent to promote the purchase or sale of property or the acceptance of employment;

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