A Los Angeles Superior Court Judge has ruled in favor of Brookstone Law PC and all other defendants in a significant court decision against embattled attorney Mitchell J. Stein by dismissing Stein’s $1 billion lawsuit against Brookstone and ordering Stein and other plaintiffs to pay all legal costs.
The case is Legaspi v. Spivak Case BC469228 State of California, County and City of Los Angeles, California.
According to court documents (Legaspi v. Spivak Case BC469228 transcript by Elsa Banda Lara, CSR #3226 Los Angeles Superior Court Department No. 307 Los Angeles, California) during the hearing on the defendants’ motions to dismiss, the Judge referred to the lawsuit as “crackpot” and according to court documents in his written ruling, stated: “The Complaint . . . is one of the most addled pieces of legal drafting which this Court has ever seen in over 40 years of legal practice and judicial service.”
Stein and his partner Erikson Davis had sued Brookstone Law, SML LLP (which represents Brookstone in various matters) and others for $1 billion, allegedly on behalf of clients of Brookstone Law and other Stein clients. The suit claimed that Brookstone had committed fraud and used Stein’s dog logo without permission.
According to court documents, even before the Court dismissed Stein’s lawsuit, the named plaintiff and other plaintiffs withdrew from the action and terminated Stein and Davis as their counsel. Numerous plaintiffs testified on behalf of Brookstone that they had never authorized the filing of the lawsuit or the use of declarations against Brookstone and the other defendants.
Court documents indicate that Brookstone and the other defendants showed that the case really was about Stein’s retaliation for the filing of a motion against Stein by SML LLP, Brookstone’s filings relating to that motion and Stein’s pique about Brookstone’s and SML LLP’s cooperation with the California Attorney General’s and California State Bar’s investigation into alleged illegal sales of mass joinder lawsuits to consumers. As a result of the investigations, law firms run by Phillip Kramer and Stein were raided, those firms’ records were seized, and their practices were taken over by the State of California.
According to court documents, Stein and lawyers working with him filed a total of six actions against the State of California, County and City of Los Angeles, California Attorney General, California State Bar and others, including Legaspi v. Spivak (Case BC469228) against Brookstone, SML LLP and the two firms’ partners. According to court documents, the lawsuits alleged civil rights violations, fraud and other torts in an alleged campaign to damage Stein and his clients. All of the actions were promptly dismissed.
- By order of the California Superior Court, the California State Bar seized Stein’s legal practice.
- Effective January 1, 2012, the [California State Bar Court has taken away Stein’s license to practice law, declaring that he is “involuntarily inactive.”
- In December 2011, the United States Department of Justice indicted and arrested Stein for securities fraud. He is currently scheduled to go on trial in October.
- In December 2011, the United States Securities and Exchange Commission filed a civil action against Stein and others for fraud.
According to court documents, in dismissing all causes of action against Brookstone and all other defendants, highly regarded California Superior Court Judge William F. Highberger found that:
- Stein and Davis failed to obtain authorization for the inclusion of all plaintiffs in this action;
- Stein and Davis brought claims without factual and/or legal support;
- Stein’s and Davis’ pleadings and advocacy were for an improper purpose;
- Stein’s and Davis’ claims were “frivolous” in that they were both (A) totally and completely without merit and (B) for the sole purpose of harassing Defendants and causing unnecessary expense.
According to court documents, on its own motion, the Court intended to impose legal costs and fees as a sanction on Stein and Davis. However, they refused to accept the sanction, forcing the Court to instead impose the obligation to pay legal costs on the individual plaintiffs. Brookstone and SML LLP then proposed that any plaintiff who promptly signed a sworn affidavit that he or she had never authorized the lawsuit or participated in the lawsuit would not have to participate in paying the legal costs. The Court accepted the approach. Davis is required to distribute the affidavits to the individuals he and Stein named as plaintiffs in the lawsuit.
According to court documents, the Court specifically cited Brookstone’s observation that Stein’s “narcissistic damages theory irreparably fails to alleged cause-in-fact or proximate cause.” In the lawsuit, Stein had claimed that he alone could win against banks and that Brookstone and SML LLP were “make believe and pretend lawyers.”
“We are extremely pleased that this decision exonerates Brookstone Law PC from the outrageous claims made by Mr. Stein, and we look forward to continuing to provide effective and expert legal help to homeowners facing foreclosures who need help dealing with banks,” said Vito Torchia, Jr., managing attorney of Brookstone Law, PC. “Thanks to expert legal work and dedication to the truth, we have turned someone formerly known by the nickname “The Doberman” into a defeated puppy.” – Source
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Update in California action against Stein and others:
The Receiver has completed his primary operational duties – suspended, then terminated the operations of the Receivership Defendants (the Non-Attorney Defendants), secured the premises where the Receivership Defendants operated, and thereafter closed those premises and liquidated the furniture and equipment on-site; secured the records (paper and electronic) of the Receivership Defendants; and orchestrated implementation of the asset freeze as to the Receivership Defendants. The Receiver and his staff have also coordinated with the parties, as necessary, for investigation and discovery.
The litigation between the California Attorney General’s office and the Defendants (both Attorney and Non-Attorney) and the parallel case of the State Bar against the Attorney Defendants are proceeding through the Los Angeles County Superior Court. The Receiver is not a party to that case and not directly involved in that litigation. The case is still in its early procedural stages.
What’s going to happen to Mitch Stein?