Mystery_January_1934Judging from Hollywood, television, and pop culture, it sometimes seems that innocent people are constantly falsely charged with (or at least suspected of) crimes. In almost every mystery drama, the evidence points to Red Herring as the culprit. It takes our hero, a character with supernatural powers of deduction and observation, to look past the incriminating distractions to uncover the actual cleverly concealed malefactor.

Sometimes, “Red” is covered in blood, his prints are on the weapon, his alibi is “implausible” (to say the least), and he has every motive in the world….


In the real world, no doubt that this actually happens: the evidence appears overwhelming, the accused foresees a high probability of a guilty verdict, but he is innocent. What should he do? Confess to the crime he did not commit? Is there a way by which he can avoid the trial and just say, “I won’t admit to something I didn’t do, but I don’t want to go to trial?”


traces-69808_1280The Fagen v. Exergy lawsuit has been the subject of several prior Minnesota Litigator posts. A number of the prior posts have to do with claimed “urgency” in the case, a feeling that apparently only Defendant Exergy and its legal counsel share lately.

U.S. District Court Mag. Judge Steven E. Rau denied Exergy’s motion for expedited hearing on its motion to add another party one year after the deadline for adding new parties this week. (And, today, he denied the motion to amend “without prejudice,” meaning Exergy gets to try again…)

See the footprints in the snow in the picture? Those symbolize the withdrawal Exergy’s previous local Minnesota counsel, Faegre Baker Daniels. Faegre Baker Daniels withdrew from the case shortly before Exergy brought its latest motion, as Fagen counsel notes in the attached blistering letter to the Court filed this week (see Point # 4).

Litigators are familiar with some clients’ processions of lawyers. The stream of models down the catwalk often represent progressions to less and less expensive lawyers as the fiscal carnage of lengthy litigation grinds on (noted here). But lawyers withdraw for other reasons as well, of course. For example, they might not feel comfortable with lead counsel’s working style or legal strategy. They might have a client communication or cooperation problems. Etc. Etc.

As for the withdrawal of the Faegre Baker Daniels lawyers as local counsel for Exergy, we only see the evidence of withdrawal, not the reasons behind it, which will very likely be kept indefinitely confidential. But I think it is fair to suggest from the history of this case and from the contents of the attached letter that this case has at least a faint whiff of a potentially noxious quagmire. There are probably other more promising opportunities for Exergy’s exiting high-powered Minnesota legal team…

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

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

The earliest known use of the legal maxim, “Hard cases make bad law,” was in 1842, 173 years ago. Since then, others have been quoted for variants of the maxim: “Bad law makes hard cases,” and even “Hard cases make good law.

This old koan-like utterance flirts with a hint of insight but does it provide any insight of any kind? The fact is that there are many legal puzzles for which there are no adequate and no satisfying resolutions. We see these situations quite often and we call them “hard cases.” They’re not hard. They’re worse. They’re basically insoluble.


"Rog and Pete" by Jean-Luc, subject to Creative Commons license.

“Rog and Pete” by Jean-Luc, subject to Creative Commons license.

Updated post (February 27, 2015): As they were not too long ago in the post below, Bassford Remele lawyers got schooled again this week on the forum defendant rule, this time as counsel for defendant Ear, Nose and Throat SpecialtyCare of Minnesota, P.A…. Better them than you, right? Don’t forget the forum defendant rule.

Original post (January 28, 2015)Citizens from different states on opposite sides with claims in which over $75,000 is at stake can fight it out in federal court rather than state court based on what is called “diversity jurisdiction.” Except when they cannot. Without certain prerequisites, they cannot even when both the plaintiff and the defendant are, like, “It’s cool, Judge. We all like you and we want to stay here in this court. We like it here!” They cannot when an out-of-state plaintiff brings a lawsuit in state court against an in-state defendant and the in-state defendant seeks to remove the case to federal court. (The defendant cannot rightly claim fear of some kind of state court bias, right? What federalism concern would the in-state defendant have?)


Flickr Creative Commons phote by Simon Scott

Flickr Creative Commons phote by Simon Scott

Lawyer ethics are implicated in blogging. For starters, there is, of course, the lawyer’s obligation of confidentiality (Minn. R. Prof. Cond. 1.4). Also, in my opinion, ethical rules regarding conflicts of interest may be implicated.

Minn. R. Prof. Cond. 1.8, for example, provides, “A lawyer shall not use information relating to representation of a client to the disadvantage of the client unless the client gives informed consent, except as permitted or required by these rules.” So, for example, I would suggest that a blog post that is drawn from experience in one’s practice, which is disadvantageous to one’s client but does not identify one’s client or any of her confidential information, still seems unethical to me. You cannot use your experience in your client’s case, I would suggest, to advocate a position in public that disadvantages your client. At least certainly not a current client.

And, of course, there are rules under section 7, “Information about Legal Services,” that all need to be respected. You cannot tout yourself as an expert in ______ when you are not and so on. And, you must observe the lawyer ethics catch-all provisions, Section 8 (“Maintaining the Integrity of the Profession”), 8.4 (“Misconduct”), 8.4(b)(“don’t be a criminal”), 8.4(c) (“don’t be a liar”), 8.4(d) (“don’t be a jerk”), 8.4(g) (“don’t be a bigot”) etc.

But what about journalistic ethics rules? Do these rules apply to legal blogging?


Fishing IconI am frequently asked if Minnesota Litigator results in actual legal work for LEVENTHAL pllc, my law firm. Will blogging get your law firm business?

Judging from what the largest law firms in our state are doing these days, assuming that these sophisticated multi-million dollar businesses do not allocate resources without a profit motive and with due diligence, the answer might well be yes (see Faegre, Fredriksen, Dorsey, Stinson Leonard, Briggs). Legal blogs are worthwhile legal marketing.

On the other hand, many other top Minnesota firms do not have blogs. And also, with respect, many top U.S. law firms waste boat-loads of money on ill-conceived marketing. Couldn’t it be that some law firm blogs successfully bring in work and some don’t? The nature and quality of the blogs must factor in.  Also sometimes it is hard to trace the origin of new business to one’s blog, but couldn’t the benefits, the new cases and clients, come indirectly from, say, lawyer-to-lawyer referrals inspired by law firm blogs?


Pop Haydn with the Shells and Pea Photo by Billy Baque

Pop Haydn with the Shells and Pea Photo by Billy Baque

An owner of a liquor store and owner of the property, the real estate, on which the liquor store sat, hired a broker to help with the sale of the store and the real estate. The broker helped put together a deal where the buyer bought the store and got an option to buy the land 2 years after the sale of the store.

The broker worked out a deal with seller that broker would get a commission on the later sale, if the sale ultimately went through.

So it seems that buyer created a new entity to buy the property and then seller argued that he did not sell the property to buyer so he did not owe the broker the commission.

The Hennepin County District Court interpreted the broker’s commission agreement quite literally and, on a close and literal reading, dismissed the broker’s claim to the commission. Seller did not, after all, sell the property to the buyer, but to a different entity. It’s just that the different entity was simply a new business entity set up by the same person. This week the Minnesota Court of Appeals reversed dismissal of the broker’s complaint.


GlaasairRGUpdate (February 24, 2015): In the tussle described below, a defensive tactic by Plaintiff to Defendants’ motions to dismiss failed this past week.

Original post (February 6, 2015): The litigation of Kedrowski v. Valters Aviation, Lycoming Engines, et al. involves a plane crash in which Plaintiff Mark Kedrowski suffered severe injuries when his Glasair Super IIS RG mdel aircraft crashed in September, 2010 near Lake Elmo Airport.

Plaintiff brought his lawsuit in Ramsey County District Court and it is before Ramsey County District Court Judge John H. Guthmann. The fight has been intense, it seems, with motions for sanctions, motions to compel, and several allegations of improper conduct in this case and in other cases involving the same defendants elsewhere.

Plaintiff’s view is that there was something defective about a fuel pump that caused his terrible accident. I have not reviewed the case file in detail but I would speculate that the defense is that the plane performed fine and the crash was due to pilot error. This would be a standard small plane crash legal battle. (Normally in these cases, I get the sense that a great deal rides on the findings of the NTSB, which appear to support the defense in this case.)



Photo by Keon McGarvey

Update (February 24, 2015): I note that the railroad filed its notice of appeal this month of the lengthy battle that I have covered for nearly two years now.

Update (January 21, 2015): Your heart can basically stop or explode without warning while you’re driving (justifying a defense of “sudden incapacitation”). So found the jury in Soo Line v. Werner Industries this past October. Too bad for Soo Line, which sued Werner Enterprises for environmental clean-up costs when Werner’s employee Dale Buzzell drove a truck into a train, a tank car full of chemicals, in particular, (and died). The jury appears to have credited evidence that Buzzell suffered an acute cardiac event which rendered him incapacitated moments before colliding with the train. Sr. U.S. District Court Judge David S. Doty (D. Minn.) denied the railroad’s motion for judgment as a matter of law or for a new trial this week.   (more…)

Dilapidated-CamperUpdate (February 23, 201): Imagine some scenarios: (1) You own “cabins” in Colorado, you sell “one-week stays” to others, and you sell 200 “one-week stays” in your “cabins” although you only have 100 one-week slots; or (2) You do not own any cabins in Colorado, you nevertheless sell “one-week stays” to others, and you sell 200 “one-week stays” in your non-existent cabins or (3) How about you start with a legitimate business, slide into plan #1, and then get piggy and add plan #2?

You might think of the first scam as an “oversold participation.” There’s a real asset or value that you’re peddling, but you’re over-peddling. The second scam is an out-right “fictitious participation.”

Apparently, a fellow named Corey Johnston was entering into both kinds of deals with Minnesota banks in the early 2000’s through an entity called First United selling interests in commercial loans rather than cabins or phantom cabins.

So, when the entire enterprise collapses and the authorities seize a pot of money from the bad guy to redistribute to creditors, insufficient to refund all the money to all of the victims, should courts treat all of the members of the “oversold participations” and the “fictitious participations” the same?

Do we treat the earliest victims the same as the latest? What if we view the earliest victims as more innocent (having less reason to doubt the scheme’s legitimacy)? The later victims could have googled “fake cruddy cabin” + “bad guy” and they’d have avoided victimization? What if some folks in the “oversold participations” actually got some time in the cabins (again, with the metaphor (work with me))? Are they treated the same as everyone else?

What if some of the cabins were uninhabitable and unfortunate suckers only stayed a day or two and immediately demanded refunds? What if some got refunds or partial refunds? Can the authorities seize those back to be redistributed pro rata among all the victims? Do some recover less money because they actually got to “enjoy” the cabins for a little? What if there were several cabins, some nicer than others, and one actually very nice? In other words, what if our bad guy also ran some legitimate deals? So maybe some of the money was not “ill-gotten gains” but was actual legitimate income?

What if our bad guy borrowed money to buy some cabins and paid lenders back with money from the bad guys “oversold participations” and/or “fictitious participations”? Does that money that our bad guy paid lenders when he was scamming or semi-scamming get “clawed back” for pro rata distribution among all of the victims?