Robert Burns, 1759-1796

Robert Burns, 1759-1796

Update (December 7, 2016): The original post, below, highlights the inherent and dramatic uncertainty of the course of civil litigation. I recently discovered that the saga continues.

Minneapolis law firm, Nilan Johnson Lewis (“NJL”) is sitting on a pile of money ($2,300,653.64) related to the settlement of the underlying lawsuit but the handful of litigants who believe they are entitled to some or all of the proceeds cannot agree on the split. I note that the NJL client, ECTG was originally sued for allegedly defaulting on a $2.4 million promissory note and, in the end, seems to have netted rather than paid the same amount (minus legal fees and the cost of illiquid frozen assets). Something obviously went quite agley.

Original post (April 8, 2014): In 1785, Scotsman Robert Burns’ plow ran over a mouse’s nest, causing the poet to give some thought to our intertwined lives unwittingly upsetting the lives of others.  “The best-laid schemes o’ mice and men gang aft agley,” he wrote. Over the years, we have revised the line to say, “the best-laid plans of mice and men often go awry.”

Nowhere is this more true than in civil litigation. A straight-forward action to enforce unpaid promissory notes appears to have spawned a whole new lawsuit claiming conspiracy, for example.

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Slimed Person cropped SLIMEIf the allegations in the 145-page complaint are true, I hope that the recently filed class action against for-profit on-line graduate schools, Walden University and Laureate Education, Inc. shuts these scams schools down for good.

Distilled to its essence, the class action complaint alleges that the schools claim to sell graduate school educations and doctoral degrees at a stated estimated price, achievable over a stated amount of time. Then, the schools string people on for years, causing students to incur hundreds of thousands of dollars of debt, and about half of the students (or maybe more?) leave the program before graduating or getting any degree.

These schools smell like more foul and fetid swamps that branch off from, and feed off, of the frothy torrent of our free-market economy (like Trump University, of course). Defenders of the schools will likely invoke the “caveat scholar” doctrine.

The challenge for the plaintiffs, I predict, will be that the defendants will seek to distinguish each and every complaining student’s gripes, arguing that individualized facts overwhelm any class-wide issues, rendering the lawsuit unfit for class action status. (When plaintiffs have individual damages in the hundreds of thousands of dollars, would it be possible to bring the cases individually? Or would it be better to consolidate them? I look forward to following the lawsuit, which is pending before Sr. U.S. District Court Judge David S. Doty (D. Minn.).

 

 

cbd5c66ff384a81df2905e50275e4b20Update (December 2, 2016): Shattuck-St. Mary was not able to strip me of my successful prediction below

Update (November 23, 2016): It is no surprise that requests to file motions for reconsideration (perhaps more accurately called, “You’re Doing it All Wrong, Boss” Motions) face long odds. We’ll see if Shattuck-St. Mary is able to strip me of my successful prediction below…

Original Post (November 7, 2016) (under headline, “More on Trial As Theater (A Follow-Up Post”): Another successful prediction for Minnesota Litigator: Last month, I noted that the Shattuck-St. Mary School opposed the three plaintiffs’ motion to consolidate their three cases against the school into a single trial. I predicted that the school’s opposition would fail to persuade U.S. District Court Judge Ann D. Montgomery (D. Minn.).

This past week, Judge Montgomery ruled:

In sum, consolidation is appropriate. The common questions of law and fact that exist between the three Plaintiffs warrant consolidating the cases for trial. The judicial resources preserved and the convenience of the witnesses strongly favor consolidation. The Court will be vigilant to prohibit any evidentiary spillover and jury confusion, and will instruct the jury at appropriate times to prevent Shattuck from being unfairly prejudiced.

I do not celebrate the school’s loss on this motion with unchecked glee.

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Shadrach's whistleThis week, U.S. District Court Judge Susan R. Nelson (D. Minn.) certified a legal question to the Minnesota Supreme Court, a relatively rare process used by federal courts to get direction from the highest state court as to issues of state law.

At issue in Friedlander v. Edwards Lifescience is the question of whether an employee confronting his boss about the boss’ own intentional wrong-doing constitutes protected conduct under the Minnesota Whistleblower Act (“MWA”).

How is it “blowing the whistle” to report wrongful conduct directly to the wrong-doer? What good does that do?

On the other hand, let’s say, hypothetically, that Mr. Friedlander was fired solely due to his confronting his boss about his boss’ unlawful conduct. Shouldn’t Minnesota citizens get protection from this?

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jack-and-the-beanstalk-1473274899vysUpdate (December 2, 2016): This post is unsolicited grandstanding about the just, fair, and proper application of U.S. contract law.

Here’s the deal: there is something fundamentally unfair about the “click-through” contracts that we all experience when we make consumer on-line purchases, sign lengthy rental car contracts, and receive small print, light-gray inked disclaimers on the backs of receipts, plane tickets, and the like. The small print is literally impossible (and I use “literally” in its real sense) for many contracting parties (that is, retail consumers) to read and understand.

As to the “micro contract terms” in the small print, any suggestion that these consumer warnings are contracts in the strict sense (that is, that they involve an offer, acceptance, consideration, mutuality of obligation, competence and capacity) is an illusion. Assuming that consumers read and understand the fine print denies reality; to the extent our law is premised on this assumption, it is indulgent and self-serving fantasy. And the result is that such terms are coercive, since in order, say, to rent a car, the consumer has no choice but to sign the supposed agreement including the micro contract terms that the consumer cannot realistically have read or understood.

On the other hand, it seems far more fair and important to hold so-called “sophisticated parties,” otherwise known as businesses or business people, those who engage in repeated and specialized transactions in the course of their work, to the fine print in their transactions. For one thing, we can and do recognize that these are businesses. Businesses are more often in a position to hire lawyers to look after their interests, and specifically, to vet contracts. Even if their lawyers let them down or if they cannot afford a lawyer, businesses cannot starve to death or be homeless as a result of a bad deal. At worst, they go out of business. Again, they’re businesses, so we should not protect them from market forces. Competitors all have to abide by the same rules. So, to the extent we let businesses off on “the fine print defense,” we are setting up incentives for businesses to ignore contractual terms and penalizing others who agree to abide by the terms.

This is all by way of saying that I will again predict that Plaintiff/Farmer Nielsen will not be allowed to argue in federal court that his soy beans had clean coats. Plaintiff/Farmer Nielsen, I predict, will be held to have agreed to have the decision go to arbitration under the Trade Rules of the National Grain and Feed Association (NGFA)notwithstanding his lawyers’ dogged efforts to keep his case in court

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HourglassA recent reminder: U.S. Magistrate Judge Steven E. Rau (D. Minn.) is strict on deadlines. (Here is an earlier post on the topic.)

In the protracted saga of Receiver R.J. Zayed’s litigation against Associated Bank due to its alleged (arguably passive) role in a Ponzi scheme (see previous post, here), the Plaintiff brought a motion to compel after the deadline for fact discovery but before the deadline for “non-dispositive motions.”

While this might seem innocuous to many, it could be fatal for Zayed’s motion.

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honoreebadgeI am delighted to share that Minnesota Litigator has again been named an ABA Top 100 law blogfirst time since 2012!

I want to thank our editors (you know who you are!), post contributors, sponsors (listed in the right-side colum), and, most of all, the readers, and, among them, most of all the active readers who give Minnesota Litigator tips, ideas, and constructive feedback.

To date, there have been 1, 947 Minnesota Litigator posts and we’re going strong!

THANKS!!!!

Is it okay for courts to cite legal blogs?

If you don’t yet read Max Kennerly’s Litigation & Trial, you’re welcome.

trench_72dpiCatAndMouseChaseJeorenMoeszUpdate (November 28, 2016): Will this slip’n’slide cat-and-mouse pursuit ever end? Have a look at the linked recently filed 63-page recitation of the judgment debtors’ years of breath-taking feats of deceit and subterfuge. Try to get your head around the number of hours that lawyers spent accumulating the information in that memorandum.

A court system that does not have the power to enforce its decisions has little power. It is a sad fact of our legal system that the high cost of compelling a losing litigants to pay judgments makes many judgments nearly worthless. Could it be that an $8 million+ judgment against a solvent company (operated under different names) is nearly worthless? If so, are our courthouses just a collection of Potemkin villages?

Update (March 29, 2016): No end in sight on a victorious plaintiff’s efforts to collection on a 2013 judgment for more than $8 million. After nearly three years of post-judgment collection efforts, it seems that the judgment debtor might have successfully jammed progress for the time being, at least, filing a bankruptcy petition in New Jersey, halting all further proceedings in the U.S. District Court for the District of Minnesota.

Update (March 21, 2016): The excruciating and protracted siege of Manley Toys, which Minnesota Litigator has reconned for years, continues…. Now shadowy entities, purportedly not the judgment defendant itself but somehow related to it, have appeared, seeking to “intervene,” slow down, or halt the already slow-grinding progress of the wheels of justice. U.S. District Court Judge Janie S. Mayeron (D. Minn.) will have none of it.

Judge Mayeron’s recent denial of a motion to intervene by Jun Tai Co. Ltd. and Winning Industrial Ltd. (emphasis on the “limited” and emphatic irony on the “winning”) is pointed:

[T]he movants wholly failed to provide the Court with any facts as to who they are, what they do (e.g., do they even sell or distribute Manley toys in the United States), what their interest in the sanctions motion is, what their relationship to Manley is, or how the outcome of the sanctions motion would affect them. Significantly, their motion was unsupported by any declaration or affidavits that would permit the Court to evaluate their contention that intervention was warranted. In fact, even their conclusory statements that they have a common ownership with Manley, but are separate legal entities, was without any evidentiary support….Counsel then explained that the reason no supporting affidavits or declarations were filed was that the motion had to be brought hurriedly and there was no time for counsel to obtain a declaration or affidavits from the movants in support of their motion. The Court placed no credence in this explanation.

I confess to vacillating between sympathy and disdain for the defenseless defense lawyers, forced to stand before the Court unarmed with either law or facts on their side. I guess it’s not child’s play but someone’s got to do it….

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"A Tough Knot to Crack" (photo by Jay Fanelli)

“A Tough Knot to Crack” (photo by Jay Fanelli)

While many people are enjoying their Thanksgiving holiday break, a few of you are reading this post. You are the die-hards. I bet that you’re lawyers who love your work. Should you be admired or pitied? Who’s to say? Hats off to you, as far as I am concerned, and enjoy a puzzler:

In a recently filed complaint in U.S. District Court (D. Minn.)(Ericksen, J.), the plaintiff LLC sues defendant LLC and, for subject matter jurisdiction, plaintiff invokes federal question jurisdiction due to claims under the federal trade secrets statute, supplemental jurisdiction over several state law claims, and, in addition diversity jurisdiction.

But, as with almost every complaint (it sometimes seems) involving an LLC claiming diversity jurisdiction in federal court, the Plaintiff failed to plead diversity jurisdiction correctly.

Under these circumstances, where the claimed diversity jurisdiction is not the sole basis for the court’s subject matter jurisdiction, will the Court, sua sponte, order that this issue be addressed?

(See answer: here.)