Buying And Selling Cases

  • Law
Another reader suggestion today:

There are so many attorneys in town no-one has ever heard of who magically have hundreds of cases in litigation, and many more hundreds in claims.  They do not advertise in any way, shape, or form, yet they have tons and tons of cases.  How?  They pay for them – tow truck drivers, ER nurses, body shop guys, insurance agents, etc.

And some of the billboard attorneys are the worst offenders.  Their billboards are just cover for what they’re really doing (paying for cases).  And all the ones who do it could be caught very easily if the state bar would just look at their tax returns – because they all write it off as “advertising expenses” when they file taxes. 

It’s a rampant problem and I’d love to see what additional information commentators add to the discussion if it were to be posted.  

Do you agree? Is this really a rampant problem or even a problem at all? 

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Anonymous
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Anonymous
November 30, 2018 5:11 pm

Your Office of Bar Counsel is at it again. As much as it pains me to defend the detestable Geraldine Kirk-Hughes, the OBC tried to impose costs for $35,000 in staff salaries on GKH. When asked to provide backup for the costs, the Office of Bar Counsel testified that it does not have to keep actual time records and can estimate the amount of staff time spent. The Supreme Court said no, if you want to collect staff costs, you have to actually keep time records.

Your OBC– we think we are superior lawyers who can just make up our own rules because we took a job after being terrible lawyers in the real world.

http://caseinfo.nvsupremecourt.us/public/caseView.do?csIID=45705

Anonymous
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Anonymous
November 30, 2018 5:37 pm

The obvious irony is that OBC, in fee dispute herings, and often discipline hearings as well, will babecuse attorneys for collecting or enforcing fees without real clear clarity on how the fees were justified.

Obviously, on contingency type cases the situation of fees is a lot easier to decipher. But many fee disputes, as well as disciplinary proceedings, don't involve a contingency contract. If attorneys are not on a contingency basis, it is mandatory for them to have a clearly written fee agreement, as well as regular billings which include an itemized description of each entry.

If you collect, or attempted to collect, $35,000 from a client, but you only estimate these costs as being reasonable for the time spent, but you have no actual billing or records of the time spent, and what each expenditure was for, the Bar lowers the boom on you.

Yet, in the case mentioned, they apparently had no problem demanding $35,000. payment for their time spent, and we are expected to accept as gospel their "estimate", even though they don't have any time sheets with description of the work performed or how long it took.

Also, would this not be double dipping in the sense that whether or not they collect $35,000. from GKH to compensate for Bar staff salaries spent on the discipline, the staff still receives their full salary regardless of whether the $35,000. is collected.

Anonymous
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Anonymous
November 30, 2018 6:09 pm
Reply to  Anonymous

This is an excellent point and was the subject of a rule change 2 years ago. It used to be that attorneys were assessed the actual costs of their disciplinary proceedings. However Stan can to the Supremes and said that he needed more money to pay his staff. Stan said he wanted a minimum:

$1500 for a reprimand
$2500 for a suspension of any length
$3000 for a disbarment
$2500 for a reinstatement (which means reinstated attorneys pay $5000)

This is now SCR 120. And yes, they expected that the Panel would (and by the way did) just accept the State Bar's word as Gospel. Yes if this was a law firm that tried to just dump $35,000 worth of fees without any records or even ability to break down tasks, you would be excoriated. Remember NRPC 1.5 says "A lawyer shall not. . .charge or collect an unreasonable fee.. . " Guess that rule does not apply to the OBC.

This case also stands for the proposition that Disciplinary Panels do whatever the State Bar feeds them to do. I served on those Panels. We are treated as members of the State Bar. Our materials are prepared and delivered to us by the State Bar. The paralegal who is supporting the Panel is the same one assisting the Assistant Bar Counsel. The concept of arms' length neutrality in disciplinary hearings is a myth.

Anonymous
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Anonymous
November 30, 2018 5:37 pm

All I am going to say is hire a non billboard, non television advertising attorney. The one thing that allows me to sleep at night is that I have morals and convictions which is a rarity in this profession.

Anonymous
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Anonymous
November 30, 2018 5:41 pm
Reply to  Anonymous

This comment made me think of Paul Powell, which caused me to spit out my coffee.

Anonymous
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Anonymous
November 30, 2018 5:58 pm
Reply to  Anonymous

9:37, one hundred percent agree. I hope you are an attorney. It gives me hope. There is an afterlife, and you will be held accountable for your actions. Karma.

Anonymous
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Anonymous
November 30, 2018 6:02 pm
Reply to  Anonymous

He will let you keep your pants.

Anonymous
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Anonymous
November 30, 2018 7:02 pm
Reply to  Anonymous

Just not the shirt on your back…

Anonymous
Guest
Anonymous
December 1, 2018 3:44 pm
Reply to  Anonymous

I started lawyering with a non-billboard, non-TV PI firm. I would scoff at those advertisers, thinking that "real lawyers" don't need to advertise. Several years later, I'm working for an advertiser, and I've quickly realized that the advertising doesn't necessarily have anything to do with the quality of the work. The attorneys I work with are better than the ones at the first firm, and our litigation work is better too. The only real difference is on the pre-lit side, where they are 100x busier than the non-advertiser.

Anonymous
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Anonymous
December 1, 2018 8:32 pm
Reply to  Anonymous

While on the post-lit side, the firm that the new firm feeds is busy while the pre-lit firm just waits for its cut.

Anonymous
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Anonymous
November 30, 2018 5:38 pm

While we're talking about Supreme Court decisions, how about McGowen v. Dist Ct. http://caseinfo.nvsupremecourt.us/document/view.do?csNameID=43542&csIID=43542&deLinkID=688464&sireDocumentNumber=18-0000* in which they say it's okay for a Plaintiff's attorney (or staff) to personally serve a complaint.

Anonymous
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Anonymous
November 30, 2018 6:18 pm
Reply to  Anonymous

Jesus what a surprise. Hardesty writes the Opinion; Pickering writes the reasoned dissent. I don't know what Hardesty has pictures of the other 5 Justices doing to each other but it is getting old.

Anonymous
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Anonymous
November 30, 2018 7:48 pm
Reply to  Anonymous

You think it is bad now, just wait for the two new ones coming on the bench. This is going to be interesting.

Anonymous
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Anonymous
November 30, 2018 9:41 pm
Reply to  Anonymous

I usually agree with Pickering, but I think Hardesty and the other 5 got it right here. An attorney is not a party to a case (I think it would be pretty scary in other applications to hold that attorney = the party), and federal courts have agreed when interpreting basically the same federal rule.

Anonymous
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Anonymous
November 30, 2018 10:23 pm
Reply to  Anonymous

1:41– Pickering actually got it right on the Federal cases. Federal courts are split on the question (unlike Hardesty who erroneously states that Federal courts are uniform on the question). Attorneys are often held to be one and the same with "party". Why do we prohibit named litigants from serving papers? Because they are not disinterested. Same is true of the attorneys. There was no need to change Sawyer. This Court is intellectually lazy and allows itself to be bullied by Hardesty. I suspect Hardesty had a bench brief done that told all of the justices that the question is settled in federal courts and the other 5 went "OK if you say so….." Pickering is the only one who goes "Mmmmm that is not correct."

Anonymous
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Anonymous
December 3, 2018 5:18 pm
Reply to  Anonymous

I'd be interested in a look into the ratio of how split it actually is by circuits.

Anonymous
Guest
Anonymous
December 3, 2018 5:44 pm
Reply to  Anonymous

The point was Hardesty misrepresented in the Majority Opinion that it is settled law in the federal courts. Not true. Like much of what Hardesty says; truth is whatever he can bully you into believing.

Anonymous
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Anonymous
November 30, 2018 5:43 pm

To: 9:37-Agreed. However, there are some fee agreements beyond contingency or hourly billing, which you did not mention. Billings are not limited to those two scenarios. There can be flat fees, and also what I call incremental fees(such as paying as the case advancing to the next level or project, and other arrangements as well. Obviously, criminal cases don't involve contingency fee arrangements, not do most attorneys perform them on an hourly billing basis.

But, yes, by the very nature of how The Bar is presenting its request, it is clear they are justifying the matter based on a time spent analysis, which sure looks like an hourly billing situation. And that means they should be held to the same standard they rigorously and consistently hold attorneys to–list the time spent and the work performed.

Anonymous
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Anonymous
November 30, 2018 8:29 pm

Doesn’t NVRPC 7.2(n) let you pay a lawyer referral service for referrals? Who’s to say what a lawyer referral service is? It’s not defined anywhere.

Anonymous
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Anonymous
November 30, 2018 9:20 pm
Reply to  Anonymous

LRIS. Only LRIS. Don't test the State Bar on this one.

Anonymous
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Anonymous
November 30, 2018 9:39 pm
Reply to  Anonymous

7.2 allows referral fees among attorneys in Nevada. It doesn't allow you to pay a referral service on a commission/royalty/contingency basis.

Anonymous
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Anonymous
December 1, 2018 3:14 am

Can somebody please explain to me what "paying for cases," i.e. "what they're really doing" is?

Anonymous
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Anonymous
December 1, 2018 4:03 am
Reply to  Anonymous

In the old days (showing my age by saying this) it was called paying a capper to funnel a case to the attorney. Most frequent cappers were tow truck drivers, ambulance staff, ER employees and body shop employees. Also had people that were paid to simply drive around with the attorney's business card and stop at the scene of the accident to send the "victim" to the attorney.

Other relationships existed but tended to be more reciprocal in nature.. attorney/chiropractor which referred back and forth to each other.

anonymous
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anonymous
December 2, 2018 7:16 pm
Reply to  Anonymous

They have police scanners and will show up at the scene of an accident within minutes, usually driving a luxury SUV of some kind. It has been blatant for years and nothing is ever done.

Anonymous
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Anonymous
December 1, 2018 9:24 am

I'm not really sure I understand the negative ethical implications of those types of arrangements, but then, hey, who cares OBC seems mostly focused on trust accounts.

Anonymous
Guest
Anonymous
December 2, 2018 6:05 pm
Reply to  Anonymous

Not true. It is an ethics violation if they say that it is an ethics violation unless you have called the hotline and asked if it was an ethics violation and been told no, in which case you are on your own.

Anonymous
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Anonymous
December 2, 2018 6:34 pm
Reply to  Anonymous

It is an ethics violation of you are a solo. If you are a larger firm, it is just practicing law, look to Glen Lerner. That dude should have disbarred decades ago.

Anonymous
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Anonymous
December 2, 2018 8:15 pm
Reply to  Anonymous

Same with the Pink Building, not owned by a lawyer, but still allowed to operate. What a legacy.

Anonymous
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Anonymous
December 2, 2018 9:00 am

Know

Anonymous
Guest
Anonymous
December 2, 2018 8:00 pm

Or Golightly.. If I remember correctly, he didn't own the Law Offices of Chad Golightly. Rather he was an employee and paid to be the front for the business, the business itself was owned by a chiropractor.

About 10 years ago there were rumors about this relationship and that the bar was going to pursue it. The word on the street was that the practice was then sold to Bob Vannah but that it would still operate under the Golightly name. Didn't hear of the OBC pursuing it after that point.

Anonymous
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Anonymous
December 2, 2018 9:05 pm
Reply to  Anonymous

Thank you! For those old enough to remember there once was no Golightly, then poof- the guy was everywhere. I just figured he was loaded to begin with but his birth as a firm really seemed to come out of nowhere.

Anonymous
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Anonymous
December 2, 2018 9:51 pm
Reply to  Anonymous

"Make yourself comfortable. Your place or mine."
Rocky Horror Picture Show aka as the present state of the practice of law in Las Vegas

Anonymous
Guest
Anonymous
December 3, 2018 1:37 am
Reply to  Anonymous

That might be Dee Schneider, but I like it either way.