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It's Not Nice To Fool The Attorney General (Or The Court Of Appeal) With Prop 65 Settlements

If you do, you just might end up with your name in an opinion like this one.  It's not a pretty sight.  Here are some of the gems from the opinion about the value of the Proposition 65 settlement in the matter of Consumer Defense Group v. Rental Housing Industry Members:

"...[I]nstead of $540,000, this legal work merited an award closer to a dollar ninety-eight."

"But when litigation is as easy as shooting the side of a barn, drawing circles around the bullet holes and then claiming you hit the bull's eye ... only the most minimal attorneys fees are conscionable."

"At oral argument, Anthony G. Graham proudly proclaimed that he was a 'bounty hunter.  The statute was created for me.'  We will have more to say about exactly who Proposition 65 was created for later, but it wasn't bounty hunters."  First clue:  the Court believes it was created to protect the general public.

"We are not the first to use the allusion to extortion to describe this litigation." 

And that's just the light stuff.  Presiding Justice David Sills has some strong opinions about what he calls the "shakedown litigation" of Proposition 65, and lets the Plaintiff have it with both barrels.  To add insult to injury, he dismisses the two related cases in Footnote 23, the final footnote in the opinion.  Not many cases get dismissed after an appeal, and even less by way of a footnote.  Justice Sill's parting shot in the footnote?  "... we leave the parties in pari delicto."

I'm surprised he didn't also award attorneys fees to the Attorney General, who objected to the settlements and filed this appeal. 

The problem started when the Consumer Defense Group sent a batch of Notices of Intent to Sue to various apartment owners around the state, and then entered into settlements designed to provide the maximum protection from future Prop 65 litigation.  The real problem came, however, when CDG and the law firm accepted some $540,000 in attorneys fees to provide the protection.  The Court accused CDG and Mr. Graham of falsification of time records and of not actually undertaking the required investigations that led to the lawsuits.  Ouch.

The undoing of the lawsuits, however, was the Notice of Intent to Sue.  It was so vague that in the Court's opinion, it could apply to every building in the state.  If you occasionally read opinions and want to know what upsets appellate justices, this one is in the must-read category, if not also for the more casual style of writing that's coming out of this District.

Posted by J. Craig Williams on Tuesday, March 28, 2006

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