Archives for August 2018

Here’s an August 28, 2018, piece by Cheryl Miller, a reporter for The Recorder,  on a federal lawsuit in Sonoma County where several property owners are suing a marijuana farm under a RICO statute. Apparently unbeknownst to me, the RICO statute is a great tool of persuasion for property owners who are bothered by the smell of marijuana farming. In the hands of good litigation counsel, RICO sounds a lot like an offer (to cave) that oughtn’t be refused. The plaintiffs and their lawyers are probably unconcerned about the residents of Wichita, Kansas, whose drinking (and cooking and washing) well water has been contaminated from the chemicals in a nearby dry cleaning plant – for six years without notice to the residents (including those with wells). Supposedly the dry cleaning lobbyists successfully maneuvered the state legislature to prevent authorities from testing the water for contamination from their highly toxic chemicals. Now, six years later, the people of Wichita want answers – as they realize they have been drinking and cooking with toxic water for several years, maybe for the bulk of the lives of their children. When it comes to marijuana, with an administration that is enthusiastically and openly undoing EPA standards at an alarming rate, there will be a greater need for medicinal THC and CBD, yes? What goes around comes around, of course.

This article https://www.law.com/therecorder/2018/08/28/sonoma-residents-sue-marijuana-farm-over-alleged-skunk-like-stench/reports on the litigation filed in a federal district court in Sonoma County over potential liability under RICO for engaging in a smelly business. I recall a California nuisance case involving a smelly chicken farm, so there’s no denying here might be an action under state law for nuisance. But RICO? Well, it appears there have been several cases across the country using the fact of federal illegality of the marijuana industry as the basis for charging racketeering violations for growing marijuana in violation of the federal statutes. Get it? Never mind the feds don’t have to prosecute those violations inside states that have expressly legalized marijuana (and mostly they don’t, as far as I understand it), now private citizens can use federal RICO leverage against businesses that commit nuisance under state law.

The allegations in the federal action take full use of RICO’s statutory penalties, including treble damages. If someone wanted to put a marijuana grower out of business, notwithstanding the arguments made in favor of the product, this “meritorious” – although arguably unconscionable – litigation could do the trick. Not sure if a Go Fund Me campaign could even begin to touch the attorney’s fees that will be required to stay alive long enough to hear the verdict of the Sonoma district court to rule on whether RICO applies in its situation. As the worthy article notes, allegations of RICO in such cases are receiving mixed reviews (ahem, I mean rulings) from the ones making the decisions at the trial court level.

If you’re interested in the use of RICO in marijuana cases, this is a quick read. I recommend it.

(Janet Sobel, Esq., receives no compensation of any kind from The Recorder publication. The opinions she expresses in connection with sharing her view of The Recorder’s articles are strictly her own, attributable to her own cogitation.)

In today’s issue of The Recorder, an online legal news’ media that publishes articles of interest to lawyers everywhere, there is one having to do with the award of attorneys’ fees in high-profile, expensive litigation. Not everyone can afford the annual subscription to this fine publication, but I am covering the cost for my subscription so I can bring to my fellow lawyers anything that strikes me as particularly newsworthy in state courts.

In this issue, there’s a fine piece of reporting by Scott Graham, one of the online paper’s court-assigned journalists, this one regarding the ruling of federal district court Judge Vincent Battaglia, in San Diego’s district, of over $3.9 million in fees following a $20,000 jury’s verdict. In a situation often confronted by lawyers in ugly litigation situations, the rubber hits the road when a judge is asked to decide the size of the fees to be awarded to the “prevailing party” when the exhausting litigation is finally over.

This case was not a simple neighborhood boundary dispute with $20,000 in damages and $4 million in legal fees to get there. This was a complicated trademark infringement case involving San Diego Comic Con’s efforts to stop Salt Lake Comic Con from using, you guessed it, “Comic Con” without affiliation or authority. San Diego Comic Con won and one issue for Judge Battaglia was in assessing fees (besides deciding whether to grant a future injunction as a final remedy). As to the assessment of fees, you can imagine the defense argument, that a $20,000 victory cannot reasonably support an award of attorneys’ fees of many millions of dollars.

That defense argument lost the day. The attorneys asserting that argument will be recycling it for their appeal to the Ninth Circuit. Importantly, as part of the record on appeal, the prevailing plaintiff apparently was able to persuade the trial court that defense tactics caused a good part of the huge amount of fees incurred.

Some interesting observations and points of contemplation for litigators everywhere come from this trial court result as to fees. First, the conduct of the defense trial counsel is going to be directly at issue on any appeal as to the fees. The basis of Judge Battaglia’s ruling as to the amount of the fees is to a pertinent degree, according to Mr. Graham’s reporting, because the defense litigated the case in an unreasonable manner, which means the counsel for defendant is in a very hot seat. Second, this case shows the futility of some outcomes. It’s obvious from the article’s summary of the proceedings that the defendants were trying to escape for a long time, and had very little going for them. The outcome reflects that kind of losing litigation strategy. Third, it shows how the drama of the case, and its legal machinations, becomes a driving force that often leads to destruction. As a reader of the article, I am left with the impression this case should have been settled long ago. I am left to wonder if Judge Battaglia didn’t have the same impression as he was deciding how much to award in fees in this case.

If you want to follow this case more closely, you can start with Mr. Graham’s article in The Recorder.