Wednesday, September 16, 2009

TRO in Defamation Case Granted: Law Firm Sues Client for Libel, Judge Grants Prior Restraint


A Houston law firm today took the unusual step of suing a client for defamation, requesting immediate injunctive relief to stop the client from spreading allegations that the firm did not properly pay out settlement moneys for personal injury claims stemming from a car wreck involving the client and the client's family members.

The sworn petition filed on behalf of the LAW OFFICE OF PAUL N. MOODY, P.C., a personal corporation, alleges the following:

Libel and Defamation of Business Reputation

17. Defendant Vo and Defendant Phi Tax have published a statement of alleged fact. The alleged statement of fact is that "they [Law Office of Paul N . Moody] use schemes to steal all the money paid for your settlement."
18. Defendants' statement referred to Plaintiff by name.
19. Defendants' statement is clearly defamatory; Defendants' statement constitutes
libel per se.
20. Defendants' statement is false. Plaintiff will prove that Defendant approved the settlement agreement that is the subject of his statement, and that Plaintiff has fully complied with the terms of the court-ratified agreement.
21. Defendants acted with malice. Defendants' statement was intended to inflict harm on Plaintiffs business reputation. Defendant Vo even alludes to the interpretation of the statement as being one intended to "insult, to slander, to hurt an individual."

Defendant Vo further encourages the widespread dissemination of the statement.

See copy of Original Petition in
Cause No. 2009-59096; filed 9/16/2009; assigned to the 80th District Court.

Judge Kyle Carter, presumably serving in the capacity of assigned ancillary judge, granted a temporary restraining order sought by the law firm this morning, setting bond at $500. See docket. The TRO restrains the Defendants "from publishing any statement of fact attacking the integrity or honesty of the Law Office of Paul N. Moody, P.C.."

A hearing on the firm's request for a temporary injunction is set for October 2, 2009, more than 14 days down the road and therefore after the date the TRO expires. The hearing will presumably be before the presiding judge of the 80th District Court to which the libel suit was assigned by random process: Larry Weiman.

Judge Kyle Carter presides over the 125th District Court. Both judges are new on the bench, having replaced the Republican incumbents in the 2008 general elections in which Harris County Republicans fared poorly, precipitating an involuntary mass exodus of long-time Republican judges from the Harris County courthouse.

Requests for immediate injunctive relief (TROs) are heard by the district judge that is assigned as "ancillary judge" on the day the application is filed. Judges serve in that function on a rotating basis. The name of the TRO judge for the day (or rather 2-week or so period) is posted at the district clerk's filing windows. The ex-parte hearings take place in the judge's respective court room.

Comment on first glance:

It seems odd that only the firm appears as Plaintiff, and not the attorney in charge, given that defamation is a personal tort and given that the false allegations complained of in the petition ultimately allege attorney misconduct. If the allegations were true, they would presumably entail disciplinary action by the State Bar against the attorney and jeopardize the attorney's license. Ergo, more would seem to be at stake than merely the reputation and goodwill of the law firm for which damages may be sought in a claim for business disparagement. The intent to "hurt an individual" attributed to the Defendant(s) likewise suggests that the firm is not the proper plaintiff, or should at least not be the sole plaintiff. Interestingly, the petition names not only the client individually as a defendant, but also a corporation, whose dba allegedly appeared on the faxes through which publication and dissemination of the offensive statements was allegedly accomplished. It also asks for attorney's fees on the tort claim.

The Clerk's office classified the lawsuit as "defamation of character", but that would be understandable as "business disparagement" is not an available case-type category; the closest label - semantically at least - being "business dissolution".

TAGS: Harris County Defamation Lawsuits: Libel Slander & Electronic, web-based, Defamation

State Bar Seeks Immediate Suspension of Local Attorney

Sep. 15. The Office of Chief Disciplinary Counsel of the State Bar of Texas this morning filed an original petition with the Harris County District Clerk seeking the immediate interim suspension of local personal injury attorney Grace Diane Kopacz. The case was assigned to the 334th District Court, the Honorable Sharon McCally presiding.

The Petition alleges that "Respondent has engaged in conduct that includes all the elements of money laundering and insurance fraud, which are both serious crimes" and concludes that "Respondent poses a substantial threat of irreparable harm to clients and prospective clients by reason of this conduct and, therefore, must be suspended from practicing law pending a final disposition of the disposition of the disciplinary proceeding." A hearing is to be set within 10 days.

The specific factual allegations, which also form the basis for criminal indictment, according to news reports earlier this year (see Lawyer and husband charged with money laundering), can be found in Part II of the petition.
See copy of Original Petition for Immediate Interim Suspension in Cause No. 2009-59239; Commission for Lawyer Discipline vs Grace Diane Kopacz.

State Bar records indicate that Kopacz was licensed in 2004 and has her own law firm (LAW OFFICE OF GRACE D. KOPACZ) with primary practice area in personal injury law, located on West Loop South in Houston. See
SBOT Member Profile of Grace Diane Kopacz

In unrelated disbarment news, the Fourteenth Court of Appeals last week issued an informative opinion which provides a cautionary tale of the dire consequences of a lesser but nonetheless serious form of prohibited conduct - the commingling of client trust funds with other monies, and the use of IOLTA accounts for payroll, business and other expenses.
Neely v. Commission for Lawyer Discipline (Tex.App.- Houston [14th Dist] Sep. 10, 2009) (Frost) (affirming attorney's disbarment for commingling of funds, use of IOLTA trust account for personal and business expenses) (admission of bank records issue, improper subpoena)
Justice Frost
14-08-00526-CV George R. Neely v. Commission for Lawyer Discipline
Appeal from 164th District Court of Harris County
Trial Court Judge: Jack Hollis Robison

TAGS: Attorney disciplinary proceedings | lawyer disbarment and reinstatement