Ronald V BofA Motion 3-28-2011 Unlocked)

Kenin M.
Spivak (SBN 97996)

1
Theodore Maloney (SBN 125094)
Dennis M. Russell (SBN 118253)
SML LLP
3 450 North Roxbury Drive, Suite 700
T}RIGIF{AfuFIIED
Beverly Hills, Califomia 90210
4
Tel: 310-691-5811 F{AR e I ?CIir
Fax: 310-691-5809
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E-mail : kspivak@SMllawgroup.com f*ils,EN{iHLES
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tmaloney @S ML lawgroup. com EL]THRIL}R COIJRT
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drussell@S MLlawgroup. com
B Christopher Tomaszewski (SBN 255061)

Bridget Jones (SBN 256086)
9
APEX LEGAL GROUP PC
10
1801 Tribute Road
Sacramento, California 95 8 1 5
11 Tel: (916) 270-2022
Fax: (916) 644-6227
L2
E-mail: chris@apexlegal.org
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Attorneys for Moving Parties
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15 SUPERIOR COURT OF THE STATE OF CALIFORNIA

L6
COUNTY OF LOS ANGELES
1-'1
Case No. 8C409444

PAUL RONALD etc., et a1.,
[Assigned for all purposes to
Plaintiffs, Hon. William F. Highberger, Dept. 3071
VS. NOTICE OF MOTION AND MOTION

TO REMOVE MITCHEL J. STEIN AS
BANK OF AMERICA CORPORATION, CO-LEAD COUNSEL FOR
etc., et al., PLAINTIFFS AND AS COUNSEL FOR
SPECIFIED PLAINTIFFS. TO
COMPEL STEIN TO TURN OVER
ENGAGEMENT AGREEMENTS AND
FOR AN ACCOUNTING;
MEMORANDUM OF POINTS AND
AUTHORITIES; DECLARATIONS OF
CHRTSTOPHER TOMASZEWSKI,
KENIN M. SPIVAK. TED MALONEY
MOTION TO REMOVE MITCHELL J. STEIN

) AND BRIDGET JONES; EXHIBITS
1
)
2 ) Action Filed: March 12, 2009
) Date:
3 ) Time:
) Department: 307
4
) Discovery Cut-Off: Not Set
5 Trial Date: Not Set
6 TO THIS HONORABLE COURT AND TO ALL PARTIES AND TO THEIR
7
ATTORNEYS OF RECORD HEREIN:
PLEASE TAKE NOTICE that on May 3, 2011, at 9:00 A.M. in Department 307 of the
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above referenced court located at 600 South Commonwealth Avenue, Los Angeles, CA. 90005
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Plaintiffs, through their counsel, SML LLP, Apex Legal Group P.C., Kenin M. Spivak,
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Christopher Tomaszewski, Bridget Jones and Ted Maloney (collectively, “Moving Parties”)
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will move this Court for an Order seeking the following relief (the “Requested Relief”):
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(a) To relieve attorney Mitchell J. Stein (“Stein”) of his position as co-lead counsel on
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behalf of Plaintiffs in this litigation;
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(b) To relieve Stein and Erikson S. Davis (“Davis”) from rendering any further legal
16 services for clients who have retained or retain any or all of Jones, Tomaszewski,
17 Apex Legal Group P.C. (“Apex”), Spivak, Spivak Law Group, or SML LLP
18 (“SML”), except those plaintiffs who file and do not revoke a written objection
19 thereto within thirty (30) days after the entry of an order for the Requested Relief;
20 (c) To require Stein and Davis to produce to Moving Parties copies of: (1) all
21 correspondence with the clients for whom Stein is relieved from providing services,
22 (2) all correspondence with Defendants as to which Moving Parties were not copied,
23 (3) all discovery propounded on Defendants or received from Defendants, (4)
24 transcripts in hard copy and disc form for all individuals who have been deposed by
25 Stein or Davis in this action, and (5) all other information necessary or appropriate for
26 a smooth transition, all within sixty (60) days after the entry of an order for the
27 Requested Relief;
28 (d) To require Stein and Davis to deliver to Moving Parties accountings of their time in
2
1 the matter for use in any lodestar computations made at the time the lawyers in this
2 matter become entitled to any fees, all within sixty (60) days after an entry of an order
3 for the Requested Relief;
4 (e) To require Stein and Davis to produce to Moving Parties or a third party designated
5 by this Court copies of all engagement agreements ever existing, whether proposed,
6 sent, received, signed or unsigned and all modifications, amendments, supplements
7 and replacements with respect thereto, whether proposed, sent, received, signed or
8 unsigned, by which either of them will or might render services and/or will or might
9 directly or indirectly receive financial benefits pertaining to all or any: (1) named
10 plaintiffs in this action, other than those plaintiffs who were disclosed and named on
11 the initial Complaint, First Amended Complaint or Second Amended Complaint, (2)
12 potential plaintiffs in this action and/or (3) potential plaintiffs in any other action
13 against all or any of the defendants in this action, within ten (10) days after entry of
14 an order for the Requested Relief;
15 (f) To require Stein and Davis to produce to Moving Parties copies of all literature or
16 other materials, except only personalized discussions in which Stein or Davis provide
17 specific legal advice (whether delivered electronically, by mail, or otherwise) used in
18 or in connection with the solicitation of the proposed plaintiffs set forth in the ex
19
parte notice sent by Davis on February 9, 2011 and any other plaintiffs proposed to be
20
added by amendment to this action during 2011; and
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(g) To require Stein and Davis to produce to Moving Parties an accounting of any and all
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financial benefits received or accrued directly or indirectly by either of them and/or
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any of the family members, partners, associates, nominees, representatives or
24
designees of either or both of them, including, without limitation, benefits by way of
25
the services of lawyers, paralegals, secretaries and other support services, offices,
26
equipment and otherwise from, on behalf of, or appertaining to: (1) named plaintiffs
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in this action, (2) potential plaintiffs in this action and (3) potential plaintiffs in any
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other action against all or any of the defendants in this action, all within sixty (60)
3
1 days after the entry of an order for the Requested Relief.
2 The Requested Relief is sought pursuant to Code Civ. Proc. g 128(a) and g 187 and the
3 Court's inherent authority and is necessary because Stein and Davis have abrogated their
4 working relationships with the legal team,placing at jeopardy the team's representation of
tr
J plaintiffs.
5 Plaintiffs' Motion is based upon this Notice of Motion, the attached Memorandum of
1 Points and Authorities, the attached declarations of Kenin M. Spivak, Ted Maloney, Bridget
8 Jones and Christopher Tomaszewski and exhibits attached thereto, the Court's record in this case
9 and such fuither evidence as may be presented to the Court regarding this Motion.
10
1t Dated: March 28,2011 SML LLp

LLP
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15 Attorneys for Moving Parties

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1 TABLE OF CONTENTS
2
I. INTRODUCTION................................................................................................................ 1
3
4 II. FACTS .................................................................................................................................. 2
5
A. Procedural History............................................................................................................... 2
6
B. The Legal Team Ruptures................................................................................................... 3
7
8 III. ARGUMENT ..................................................................................................................... 8
9
A. This Court has the power, and indeed the obligation, to issue an appropriate order to
10 facilitate the proper and efficient administration of this case .................................................. 8
11 B. The legal team, as originally structured, is no longer functioning efficiently which will
adversely affect the team’s ability to effectively represent Plaintiffs ..................................... 10
12
C. Moving Parties are the originating lawyers for a majority of the Ronald clients and
13
may be the originating or co-counsel for nearly all of the Ronald clients .............................. 12
14
D. The legal team has grown and Stein is not required as co-lead counsel or as a counsel
15 with respect to clients who do not object to his discharge....................................................... 12
16 E. Granting relief in a timely manner will not only facilitate the efficient administration
17
of justice, but it will avoid known future pitfalls, saving future judicial resources and
protecting Plaintiffs. ................................................................................................................... 13
18
F. Moving Parties are entitled to an order compelling Stein to turn over all engagement
19 letters and to an accounting. ...................................................................................................... 13
20
IV. CONCLUSION ............................................................................................................... 15
21
22
23
24
25
26
27
28
i
1 TABLE OF AUTHORITIES
2
3
Cases
4
Asbestos Claims Facility, et al., v. Berry & Berry, 219 Cal App. 3d 9 (1990) ........ 9, 10
5
Ferguson v. Lieff, Cabraser, Heimann & Bersntein LLP, 95 Cal. App. 4th 154 (2002) ..... 13
6
Hays v. Superior Court, 16 Cal. 2d 260, 264 (1940) ............................ 9
7
Lu v. Sup. Ct., 55 Cal. App. 4th 1264 (1997) ............................. 9, 15
8
Statutes
9
Code Civ. Proc. § 187 ............................................... 15
10
Code Civ. Proc. §128(a) .............................................. 8
11
Code Civ. Proc. §187 ................................................ 8
12
13 Rules
14 CRC Rule 8.18 ................................................... 11
15 CRC Rule 8.25(a).............................................. 11
16 CRPC Rule 3-700( C )(3) ............................................ 10
17 CRPC, Rule 1-400 ................................................. 11
18 Rule 3.400 ....................................................... 9
19 Rule 3.401 ....................................................... 9
20 Rule 9.40(a) ...................................................... 8
21 Section 4 ....................................................... 10
22 Standard 2.1 ...................................................... 9
23 Standard 3.10(a) ............................................... 9, 10
24
25
26
27
28
ii
1 MEMORANDUM OF POINTS AND AUTHORITIES
2 I. INTRODUCTION
3 This Motion is brought on behalf of four of the six lawyers in this action, who
4 collectively originated a majority of the plaintiffs: Kenin M. Spivak (“Spivak”) and Ted
5 Maloney (“Maloney”), currently of SML LLP (“SML”), Bridget Jones (“Jones”) and
6 Christopher Tomaszewski (“Tomaszewski”), of Apex Legal Group P.C. (“Apex”),1 SML and
7 Apex (collectively, the “Moving Parties”).2
8 The Moving Parties seek to relieve Stein as co-lead counsel, relieve Stein and Davis from
9 rendering services for the Moving Parties’ clients and obtain copies of applicable engagement
10 agreements and an accounting.
11 The Motion pertains to a rupture of the relationship between, on the one hand, the
12 Moving Parties, and on the other, Mitchell J. Stein (“Stein”) of Mitchell J. Stein & Associates
13 and Erikson M. Davis (“Davis”) of the Law Office of Erikson Davis.3 This rupture has impeded
14 the legal team’s ability to give 100% to our clients and will seriously erode the team’s ability to
15 do so for the future.
16 As discussed during the December 17, 2010 hearing by the Court, Bank of America
17 (“BofA”) counsel Keith Klein, Spivak and Stein, Spivak is co-lead counsel in charge of
18 pleadings and Stein is co-lead counsel in charge of discovery.4 Spivak’s responsibilities also
19
include directing research. Stein’s responsibilities also include procedural matters and liaising
20
with Stein-Spivak clients. However, to the Moving Parties’ knowledge, until February, 2011, all
21
22
1
23 Tomaszewski and Jones also recently became of counsel to SML.
2
By submitting this Motion, attached declarations and supporting documents, the Moving Parties
24
do not intend to waive and do not waive any privileges, including, without limitation, work
25 product protection.
3
26
Davis is also associated with the law firm of Kramer & Kaslow (or an affiliate thereof) and
with Mitchell J. Stein & Associates. See Spivak and Maloney declarations, annexed hereto.
27 4
In a status report filed on March 25, 2011 by Davis, without giving Moving Parties the
28 opportunity for prior review, Stein is referred to as “lead counsel.”
1
1 counsel contributed to substantially all aspects of the case, consulted on and approved of each
2 other’s material contributions to the case and jointly developed and executed strategy.5 See
3 annexed Spivak declaration (“SD”) at ¶¶ 5-7, Tomaszewski declaration (“TD”) at ¶¶ 22, 24,
4 Maloney declaration (“MD”) at ¶ 3 and Jones declaration (“JD”) at ¶¶ 6, 8.
5 The Moving Parties do not by this Motion suggest that Stein is not a talented lawyer or
6 advocate, or that he has not contributed to this case. Rather, this Motion is focused on a lack of
7 civility, transparency and coordination with co-counsel that has reached a point where it is
8 impracticable for the legal team to function as a team, thereby materially impairing the ability of
9 counsel to fully represent the interests of the plaintiffs in this action as it proceeds.
10 While Moving Parties allege Stein is to blame for the ruptures, Stein might assert that
11 Moving Parties are to blame. Whatever the causes, the fact of the rupture is beyond dispute. As
12 a result, co-counsel can no longer effectively act together on behalf of the plaintiffs named in the
13 Fourth Amended Complaint (“4AC”) or plaintiffs who might be added to the action.
14 II. FACTS
15 A. Procedural History
16 On March 12, 2009, 17 individuals filed a complaint in this action in Los Angeles County
17 Superior Court. The plaintiffs were clients of Jones and Tomaszewski (partners in Apex) and
18 Stein. Apex originated 16 of the 17 plaintiffs. Apex and Stein agreed to work together, as
19
reflected in the caption of the complaint. TD ¶ 2.
20
As more fully explained in the TD, through the Second Amended Complaint, the caption
21
remained the same and Apex continued to originate most clients. Thereafter, in or about May
22
2010, Stein, with the approval of Apex, asked Spivak to become co-lead counsel responsible for
23
pleadings and research. Stein separately recruited Davis at approximately the same time. TD
24
¶¶ 3-6, SD ¶ 5 and JD ¶ 3.
25
Accordingly, the caption of all court filings after that time and until March 15, 2011
26
27 5
Except as described in this Motion and the annexed declarations: the co-counsel generally have
28 not been involved in each other’s interaction with clients and potential clients.
2
1 consisted of Jones, Tomaszewski, Stein, Davis and Spivak. At the beginning of 2011, Spivak
2 formed SML. Maloney then was added to the caption as an SML attorney. MD ¶ 4.
3 On June 14, 2010, this Court ordered the plaintiffs to file the TAC. Spivak was the
4 principal drafter, assisted primarily by Maloney, but as with all other court filings to that time,
5 the entire team contributed to the TAC and approved of it. The TAC, filed on July 7, 2010,
6 named 249 plaintiffs. Spivak and Stein, assisted by their family members worked
7 collaboratively to qualify plaintiffs for the TAC based on criteria established by Stein and on the
8 understanding that the resulting clients would be their joint clients. Stein took responsibility for
9 delivering a Stein-Spivak engagement agreement prepared by Spivak to their prospective clients
10 and for executing and processing the agreements. Separately, Apex also qualified clients and
11 took responsibility for delivering a similar engagement agreement also prepared by Spivak to its
12 clients and for executing and processing those agreements. Neither agreement required clients to
13 pay a retainer or to reimburse costs, unless the action was successful. TD ¶ 9, SD ¶ 43.
14 Of the 249 named plaintiffs in the TAC, Moving Parties estimate that Apex originated
15 128 clients, Spivak, 10 clients, Stein, two clients, Davis one client and the Stein-Spivak
16 collaboration, approximately 108 clients. TD ¶ 11, JD ¶ 3.
17 As described at TD ¶¶ 12-13, Spivak directed the successful effort to remand the action
18 and the Plaintiffs’ ability through the TAC and opposition to BofA’s demurrer, to finally place
19
the case at issue on January 11, 2011. At that time, the Court certified for interlocutory review a
20
writ by BofA with respect to the Court’s overruling of the TAC’s first cause of action. BofA
21
filed a petition for a writ (the “BofA Petition”) on or about March 11, 2011.
22
B. The Legal Team Ruptures
23
By oral agreement and practice of the legal team, the plaintiffs are jointly represented by
24
Davis, Jones, Maloney, Spivak, Stein and Tomaszewski, with Spivak and Stein as co-lead
25
counsel, each with separate, but somewhat overlapping responsibilities. Regardless of
26
responsibilities, to the Moving Parties’ knowledge, until February 2011, all counsel contributed
27
to court filings and approved of those filings and other key aspects of the litigation. TD ¶ 7, SD
28
¶ 24, MD ¶ 3, JD ¶ 8.
3
1 From late 2010, Spivak observed Internet postings regarding Stein, attorney Phillip
2 Kramer (“Kramer”), Kramer & Kaslow and K2 that included inaccurate and inappropriate
3 assertions. Spivak expressed concerns to Stein and made clear, among other things, that: (1) no
4 client could become a client in this action if there was uncertainty about that client’s provenance,
5 (2) as to clients with an appropriate provenance, after provision for a reserve for litigation costs,
6 Spivak and Stein were entitled to share in any retainers in accordance with their understandings,
7 and (3) Spivak needed copies of all Stein-Spivak retainer agreements and an accounting of any
8 income thereunder. 6 SD ¶ 14.
9 Stein denied any wrongdoing and also declined Spivak’s requests. On December 21,
10 2010, Stein emailed Spivak. He insisted that all Stein-Spivak clients were his clients alone and
11 asserted that providing copies of the agreements or an accounting would violate attorney-client
12 privilege. Stein also advised Spivak that Spivak’s positions could violate Spivak’s fiduciary
13 duties and subject him to liability. Thereafter, communications between Stein and Spivak
14 deteriorated further. SD ¶¶ 15, 17.
15 Late last year, Maloney rendered legal services for Stein and Kramer with respect to this
16 case and other mass joinder actions. By year’s end, their relationship also frayed. Stein then
17 sent emails to third parties that vilified Maloney and revealed information Maloney disclosed to
18 Stein in contemplation of Stein rendering legal services for Maloney. MD ¶ 7 SD ¶ 9.
19
Following the February 3, 2011, Court hearing in which BofA expressed concerns
20
regarding Internet postings and mailings purportedly involving Kramer, Stein and K2, each of
21
Spivak and Tomaszewski separately expressed their concerns to Stein. Thereafter, Stein at
22
various times refused to communicate with one or more of Jones, Tomaszewski and Spivak and
23
at various times threatened that he or “clients” would commence legal action against the
24
25
6
26 Moving Parties are not aware of a named plaintiff in this action who has paid a retainer. The
engagement letters prepared by Spivak did not include a retainer. However, the Moving Parties
27
have been advised that Stein modified the form to include a retainer. TD ¶ 31, SD ¶¶ 45-49, JD
28 ¶ 13.
4
1 foregoing and Maloney. 7 TD ¶¶ 20-21, SD ¶¶ 8, 15, 17, JD ¶ 5.
2 Over the last few months, Stein has repeatedly implied that he will cause third parties
3 with whom he has a relationship to commence legal actions against one or more of the Moving
4 Parties. TD ¶ 21, SD ¶¶ 8, 15, 17.
5 Regarding the 4AC, Stein advised his co-counsel that he or his office had completed
6 certain required tasks. He then went so far as to “instruct” Apex not to communicate with clients
7 they or Spivak had originated because he had taken care of the matter. Stein never delivered the
8 product he said had been completed. TD ¶ 19, SD ¶ 20.
9 Stein next asserted that Spivak and/or Apex were responsible for the tasks Stein did not
10 perform and threatened legal actions for their alleged failures. He has, of late, also repeatedly
11 complained that he is the only person doing any work, even as he apparently delegated to others
12 the work he alleged he was staying up all night to do and has excluded the team. TD ¶ 20, SD ¶¶
13 20, 52, JD ¶ 5.
14 Stein also has alternatively refused to sign written agreements with co-counsel, promised
15 to prepare and deliver agreements and stated that it was “unlikely” he would sign agreements.
16 TD ¶ 14, SD ¶ 29.
17 During a hearing on March 9, 2011, without naming him, Stein advised the Court that he
18 intended to move for the admission of Michael S. Riley (“Riley”) to appear pro hac vice.8 At no
19
time did Stein consult with Moving Parties regarding Riley’s involvement in this action. TD
20
¶¶ 29, 30, SD ¶¶ 21, 23, 30-31, MD ¶¶ 8-9, JD ¶¶ 8-9, 11.
21
Until February 2011, each member of the legal team had been accorded the opportunity
22
by the other members of the team to review, comment on and approve all important motions and
23
7
24 The broader situation of improper and inaccurate client solicitations involving mortgage
litigation prompted the California Department of Real Estate to issue a “Consumer Alert”
25 entitled “Fraud Warning Regarding Lawsuit Marketers Requesting Upfront Fees for So-Called
26
‘Mass Joinder’ or Class Litigation Promising Extraordinary Home Mortgage Relief.” See
Exhibit G to Spivak declaration
27 8
Stein repeatedly refers to Riley as the former head of the Florida antifraud division. Mr. Riley
28 does not appear to have served in such capacity. See SD ¶ 22 and Exhibit B to SD.
5
1 other court filings. On February 9, 2011, without prior consultation with Moving Parties, Stein
2 and Davis sent a notice to BofA counsel for a proposed ex parte motion regarding the addition of
3 394 plaintiffs to the Ronald action. TD ¶ 23, SD ¶ 19, JD ¶ 7.
4 On February 28, 2011, for the first time, a material filing was made without consultation
5 with any of the Moving Parties when Stein and Davis filed an application for a temporary
6 restraining order (“TRO Application”) with respect to imminent foreclosures against certain
7 Apex-originated clients. Stein had informed Spivak that Davis was adapting a preliminary
8 injunction motion written by Spivak and assured Spivak that he would have ample time to
9 review and vet the draft TRO Application. TD ¶ 25, SD ¶¶ 25-26, JD ¶¶ 8, 9.
10 Instead of complying with the legal team’s general agreement and practice and contrary
11 to Stein’s specific assurances, Davis filed the TRO Application without review by Spivak or the
12 other Moving Parties of any draft or supporting research. Following two hearings, the Court
13 denied the TRO Application and certified the decision for interlocutory review. After the second
14 hearing, Stein and Spivak agreed that Stein would write the first draft of a petition (herein, the
15 “TRO Petition”) for Spivak’s review, oversight of additional research, revisions and approval.
16 TD ¶¶ 25-26, SD ¶¶ 27-28, MD ¶ 8, JD ¶ 8.
17 Thereafter, Spivak began work on the TRO Petition. He reviewed the research
18 undertaken by Stein’s office for the TRO Application, undertook additional research and emailed
19
to the team that research, an outline of issues to be researched for the TRO Petition and potential
20
bases for the writ. SD ¶¶ 27-28.
21
Following a hearing in this Court on the Defendants’ motion to compel and for sanctions
22
against Stein, Stein advised Spivak that he would send the draft TRO Petition to Spivak by
23
Thursday evening (March 10, 2011) or Friday morning (March 11, 2011), at “the latest.” When
24
Spivak did not receive the draft, he repeatedly emailed and texted Stein inquiring as to the status
25
of the draft. Stein never responded and later told Tomaszewski in a phone conversation that he
26
had no recollection of receiving any emails or texts from Spivak regarding the TRO Petition., TD
27
¶ 26, SD ¶ 28.
28
Without consultation with Moving Parties: (1) on March 14, 2011, Stein and Davis filed
6
1 Applications for Riley to appear pro hac vice in the Appellate Court (the “Riley Applications”);
2 (2) on March 15, 2011, Stein, Davis and Riley filed a so-called “Preliminary Opposition (and
3 Memorandum) in Response to Defendants’ Petition and Peremptory Writ of Mandate or Other
4 Appropriate Relief” (the “Preliminary Opposition”); and (3) on March 15, 2011, Stein, Davis
5 and Riley filed the TRO Petition. TD ¶ 25, SD ¶ 30, MD ¶¶ 8-9, JD ¶ 8.
6 Stein and Davis deleted from the captions of each of the Court of Appeals filings the
7 remaining members of the Ronald legal team – Spivak, Jones, Maloney and Tomaszewski. In
8 their place (apparently before his pro hac application had been approved), Stein added Riley, a
9 stranger to this action. 9 TD ¶ 30, SD ¶¶ 18, 37.
10 Moving Parties learned of the Court of Appeals filings from a Riley Application emailed
11 to Jones and Tomaszewski and a casual comment made by Davis to Spivak when Spivak called
12 Davis to coordinate research for the BofA Petition. Despite repeated requests to Stein and Davis,
13 neither of them emailed (or otherwise provided) any of the substantive Court of Appeals filings
14 to Moving Parties. TD ¶¶ 25-29, SD ¶¶ 18, 30-31, MD ¶ 8, JD ¶¶ 8-9.
15 Then, Spivak again requested copies of the filings by email on March 21, 2011. Stein’s
16 reply made it clear that Stein would not provide copies of the Court of Appeals filings to the
17 Moving Parties. Further, Stein warned: “I believe many of the Ronald clients have or shall
18 imminently file suit against SML and Apex.” See Exhibit A to SD. 10
19
Though the BofA Petition unsurprisingly includes the Moving Parties in the service list,
20
the Moving Parties are excluded from the service lists for the Stein-Davis-Riley Court of
21
Appeals filings. See Exhibits C, D and E to the Spivak declaration.
22
23
9
According to a “White Paper” dated January 15, 2011 accessed on February 26, 2011, Riley is
24
apparently one of Stein’s partners in a legal marketing network called Hartford Dunn.
25 According to the White Paper, the purpose of Hartford Dunn is to enter into affiliate agreements
with lawyers nationwide who are interested in pursuing litigation pertaining to mortgages. See
26 Exhibit F to Spivak Declaration.
10
27 Sunday night, March 27, 2011, Stein sent an email to Spivak and Tomaszewski seeking
assistance with respect to a matter related to the TRO Petition. He attached a PDF of an
28 unsigned version of the TRO Petition to that email. TD ¶ 32, SD ¶ 35.
7
1 Team cohesion and trust was further eroded by the Riley Applications. Rule 9.40(a) of
2 the California Rules of Court (“CRC”) provides, in part: “No person is eligible to appear as
3 counsel pro hac vice under this rule if the person is . . . Regularly engaged in substantial
4 business, professional, or other activities in the State of California.” Riley is ineligible to be
5 admitted pro hac vice. His admission also is illogical, since he focuses on business endeavors,
6 ended his litigation practice many years ago and is not admitted in California. SD ¶¶ 18, 22, MD
7 ¶ 6.
8 The logical inference is that Riley’s name was added to the Court of Appeals filings to
9 give credibility to Riley’s marketing efforts on behalf of Hartford Dunn.
10 Within the last week, Stein and Davis filed an Opposition to Motion for Leave to
11 Intervene Filed by Asset Guardian Plan, Inc. without including Spivak’s comments and a Status
12 Report without first circulating it for review, despite a specific email discussion between Stein
13 and Spivak on that subject. Davis was copied on that email discussion. SD ¶ 38.
14 III. ARGUMENT
15 A. This Court has the power, and indeed the obligation, to issue an appropriate order
to facilitate the proper and efficient administration of this case
16
It is a well-recognized principle that this Court has statutory and inherent equitable power
17
to issue orders to implement the efficient administration of justice. The California legislature has
18
codified this principle by granting power to every court to provide for the orderly conduct of
19
proceedings before it. Code Civ. Proc. §128(a) provides in pertinent part:
20
(a) Every court shall have the power to do all of the following:
21
(1) To preserve and enforce order in its immediate presence.
22 (2) To enforce order in the proceedings before it, or before a person or persons
empowered to conduct a judicial investigation under its authority.
23 (3) To provide for the orderly conduct of proceedings before it, or its officers.
(4) To compel obedience to its judgments, orders, and process, and to the orders of a
24
judge out of court, in an action or proceeding pending therein.
25 (5) To control in furtherance of justice, the conduct of its ministerial officers, and of
all other persons in any manner connected with a judicial proceeding before it, in
26 every matter pertaining thereto.
27 Code Civ. Proc. §187 also provides in pertinent part:
28
8
When jurisdiction is, by the Constitution or this Code, or by any other statute,
1
conferred on a Court or judicial officer, all the means necessary to carry it into
2 effect are also given; and in the exercise of this jurisdiction, if the course of
proceeding be not specifically pointed out by this Code or the statute, any suitable
3 process or mode of proceeding may be adopted which may appear most
conformable to the spirit of this Code.
4
The often repeated formulation of this Court’s power was first stated by the
5
California Supreme Court in Hays v. Superior Court, 16 Cal. 2d 260, 264 (1940).
6
There is nothing novel in the concept that a trial court has the power to exercise a
7
reasonable control over all proceedings connected with the litigation before it.
8 Such power necessarily exists as one of the inherent powers of the court and such
power should be exercised by the courts in order to insure the orderly
9 administration of justice.
10 This Court has broad discretion in issuing orders to ensure proper management of
11 this case and efficient administration of justice. See Lu v. Sup. Ct., 55 Cal. App. 4th 1264
12 (1997); Asbestos Claims Facility, et al., v. Berry & Berry, 219 Cal App. 3d 9 (1990).
13 Pursuant to Standards of Judicial Administration (“SJA”), Standard 2.1, this
14 Court has express broad case management authority to keep the proceedings efficient.
15 Standard 2.1 provides: “Trial courts should be guided by the general principle that from
16 the commencement of litigation to its resolution, whether by trial or settlement, any
17 elapsed time other than reasonably required for pleadings, discovery, preparation, and
18 court events is unacceptable and should be eliminated.”
19 This case has been designated as, a complex case pursuant to CRC Rule 3.400 and Rule
20 3.401. Because this case is a complex case, the Court has an additional obligation to act early to
21 see that it is efficiently administered. “In complex litigation, judicial management should begin
22 early and be applied continuously and actively, based on knowledge of the circumstances of each
23 case.” SJA, Standard 3.10(a). The Court’s broad authority and mandate to assertively ensure
24 efficient administration of a complex case such as this case are well established. See, e.g.,
25 Asbestos Claims Facility, et al., v. Berry & Berry, 219 Cal. App. 3d 9 (1990).
26 California courts also look to federal courts for guidance on the management of complex
27 civil litigation, and in particular with respect to appointment of lead counsel. See Asbestos
28 Claims Facility, et al., v. Berry & Berry supra. In Asbestos Claims Facility, et al., v. Berry &
9
1 Berry, the court observed: “Several federal courts have concluded that in complex civil
2 litigation, the trial court’s inherent power extends to the appointment of general or liaison or lead
3 counsel to perform certain functions on behalf of several parties with common interests, and that
4 such an appointment does not interfere with a party’s right to select its own counsel.” 219 Cal
5 App. 3d at 20.
6 Consistent with SJA, Standard 3.10(a)’s admonition that case management “begin early
7 and be applied continuously and actively,” when it appears that an appointment of co-lead
8 counsel should be changed, the Court should act to make an appropriate change.
9 B. The legal team, as originally structured, is no longer functioning efficiently which
will adversely affect the team’s ability to effectively represent Plaintiffs
10
As is common in complex litigation, Plaintiffs comprise numerous individuals who
11
initially retained separate counsel (or sub-sets of the counsel in this case). To effectively and
12
efficiently represent the clients and administer the case, counsel coordinated their efforts and
13
forged a team. Pursuant thereto, counsel appointed Stein and then Spivak to be co-lead counsel.
14
Through the leadership of co-lead counsel, the case has been brought to this point.
15
However, as demonstrated above and by the annexed declarations, the communications
16
and working relationships among the Stein faction of Plaintiffs’ legal team and the remainder of
17
the legal team has fractured, with threats, unilateral acts and lack of consultation and approvals.
18
The California Attorney Guidelines of Civility and Professionalism (the “Guidelines”)
19
set the standard of civility in the practice of law in California and have been adopted by the State
20
Bar’s Board of Governors. Section 4 of the Guidelines provides: “An attorney’s
21
communications about the legal system should at all times reflect civility, professional integrity,
22
personal dignity, and respect for the legal system.” Under this section, an attorney” should not
23
disparage the intelligence, integrity, ethics, morals or behavior of the court or other counsel,
24
parties or participants when those characteristics are not at issue,” or “create a false or
25
26
misleading record of events.”
27
Pursuant to CRPC Rule 3-700( C )(3), a member should withdraw when “The inability to
28
work with co-counsel indicates that the best interests of the client likely will be served by
10
1 withdrawal.”
2 Failing to provide or serve Moving Parties with the TRO Petition, the Riley Applications
3 and the Preliminary Opposition violates the CRC and imperiled the filings. CRC Rule 8.18
4 provides: “Except as these rules provide otherwise, the reviewing court clerk must not file any
5 record or other document that does not conform to these rules.” (Emphasis supplied).
6 CRC Rule 8.25(a) provides:
7 (1) Before filing any document, a party must serve, by any method permitted by the Code
of Civil Procedure, one copy of the document on the attorney for each party separately
8 represented, on each unrepresented party, and on any other person or entity when
required by statute or rule.
9
(2) The party must attach to the document presented for filing a proof of service showing
10 service on each person or entity required to be served under (1). The proof must name
11
each party represented by each attorney served.
Moving Parties are not seeking removal of any counsel in this case, but: (i) the un-
12
designation of one of the co-lead counsel for Plaintiffs, and (ii) the separation of the attorneys
13
into separate teams on behalf of their respective clients. It may be that the teams will be able to
14
15
coordinate their joint prosecution of the case, but the separation of the teams will, at least,
16
eliminate the expectations, acrimony and reliance of any member of the current team on any
17
other member of that team. That will be in the best interests of all clients.
18
Without considering whether Stein’s client solicitations or Hartford Dunn violate any
19
applicable law or rule, or whether there is anything amiss in any of Stein’s or Davis’ business or
20
legal relationships, the lack of transparency to the legal team during a period of heightened
21 scrutiny of these matters by BofA, the Department of Real Estate and others deprives Moving
22 Parties of the ability to monitor the circumstances in which they are providing legal services and
23 subjects them to the risk of misleading clients and prospective clients. That impairs their
24 credibility and erodes the client-lawyer relationship and with it the ability of all counsel to
25 effectively represent clients. See, e.g., CRPC, Rule 1-400.
26 Moving Parties are seeking to act in the best interests of all Plaintiffs by avoiding the
27 peril that arises from uncertainty and inconsistency. The issue in this Motion is not the quality of
28 any Court filing or decision to this date. Until recently, the team’s assignments, expectations and
11
1 unity of purpose existed to best advance the common good of all plaintiffs. Animosity,
2 intimidation, opaqueness and uncertainty about what one counsel may do as a “lone ranger”
3 diminishes the strength of the team and imperils the outcome.
4 Counsel have entered into engagement agreements with clients by which they have
5 rights, duties and potential liability. If they are excluded from the decision-making process and
6 the development and execution of strategy, Moving Parties may fail to fully discharge their
7 duties and, in any event, clients may receive less service than they otherwise could and should
8 receive from a unified team that works together to maximize results.
9 Given the circumstances and dysfunction described herein, clients are best served by
10 discharging Stein as co-lead counsel and as counsel for clients who do not object to his
11 discharge. Then, without apparent authority or misplaced authority, Stein, Davis and Moving
12 Parties and their respective clients can work together, or not; but at least the cloud of uncertainty
13 and risk and intimidation will be lifted.
14 C. Moving Parties are the originating lawyers for a majority of the Ronald clients and
may be the originating or co-counsel for nearly all of the Ronald clients
15
Stein is not co-lead counsel because of any action by any client or even this Court. He is
16
co-lead counsel because of consensual designation as such by the other counsel in this matter,
17
particularly Apex.
18
Pursuant to their engagement agreements, Moving Parties have been engaged by not less
19
than 134 of the 247 plaintiffs in the Ronald action. The actual number likely is materially larger.
20
However, Stein has under his exclusive custody and control Stein-Spivak engagement letters
21
presumably returned by more than 100 of the plaintiffs added to the TAC and additional
22
engagement agreements for potential future plaintiffs. Stein has refused to provide these
23
engagement letters to the Moving Parties.
24
D. The legal team has grown and Stein is not required as co-lead counsel or as a
25 counsel with respect to clients who do not object to his discharge
26 Since the filing of this case, the legal team has grown. It started with the addition of
27 Spivak and Davis in May 2010 and then, shortly thereafter, Maloney. Now, with the formation
28 of SML, Moving Parties have a deeper bench of counsel, including, within SML alone, two
12
1 litigators, each with more than 20 years of experience, and two other lawyers with extensive
2 litigation experience. Moving Parties can bring in additional lawyers, if necessary.
3 Stein and Apex had entrepreneurial drive in filing this case. This Motion does not allege
4 that Stein’s experience and wisdom would not be valuable in a cohesive, well managed,
5 transparent, mutually-respectful team with common objectives and focus. Rather, this Motion
6 suggests that regardless of how talented any one lawyer may be, animosity, inconsistency,
7 unilateral acts, opaqueness, disorganization and unaligned goals outweigh the talent and will
8 harm the best interests of our clients.
9 E. Granting relief in a timely manner will not only facilitate the efficient
administration of justice, but it will avoid known future pitfalls, saving future
10
judicial resources and protecting Plaintiffs.
11 The dysfunction among the Plaintiffs’ legal team will adversely affect Plaintiffs if the
12 Requested Relief is not granted. Further, clients also will be deprived of the leadership of the
13
lawyers of their selection. Indeed, a lack of clarity in Plaintiffs’ counsel’s roles can not only
14
prejudice clients’ interests, but also lead to future litigation. See, e.g., Ferguson v. Lieff,
15
Cabraser, Heimann & Bersntein LLP, 95 Cal. App. 4th 154 (2002).
16
Replacing Stein as co-lead counsel will not inhibit the representation of all Plaintiffs and
17
likely will cause only a brief interruption in case management as information, leadership and
18
responsibilities are re-assigned and experienced litigators are added to the team. Stein may
19
continue to represent those clients who engage him alone or insist on his representation. At
20
times, the separate plaintiffs’ legal teams may file joinders. They may cooperate (or be required
21
to do so) in assignment of responsibilities to avoid duplication of effort or additional burdens on
22
Defendants or the Court. Where counsel disagree, they will assert their independent positions. It
23
is not anticipated that this will unduly burden Plaintiffs, Defendants or this Court.
24
The time for the Court to take remedial action is now, before prejudice occurs to
25
Plaintiffs and to avoid any future readily avoidable litigation.
26
F. Moving Parties are entitled to an order compelling Stein to turn over all
27 engagement letters and to an accounting.
28 To properly represent their joint or separate clients, Moving Parties must be able to
13
1 confirm their duties and responsibilities to, and their relationships with, their clients. Stein has
2 concealed both contractual and financial information from Moving Parties. It is critical that
3 there be complete transparency among counsel working on behalf of clients in this matter and
4 who would be entitled to share in a common pool of compensation derived from those clients.
5 Moving Parties are attempting to clarify the status of the engagement agreements entered
6 into as a result of the Stein-Spivak collaboration and the clients’ intentions. By the hearing of
7 this motion, the foregoing may be clarified. However, to the extent Moving Parties are unable to
8 reach any of the clients or the clients do not respond, Moving Parties require copies of the client
9 agreements returned to Stein and/or issued by Stein so that the parties can resolve their rights and
10 obligations and serve the best interest of clients, whether currently plaintiffs or prospective
11 plaintiffs. Moving Parties will not be able to reach clients who signed Stein-Spivak agreements
12 where the identities or other contact information of those clients are known only to Stein, unless
13 he produces the necessary information.
14 Without those agreements – including all versions issued, received and modifications,
15 supplements and replacements – Spivak has no way to know who was given an offer to retain
16 him, who attempted to retain him, who did retain him, who has discharged him, or any of the
17 facts or circumstances pertaining thereto. Without the solicitations pertaining to new proposed
18 clients, Moving Parties have no way to ascertain whether any misrepresentations were made in
19 the nature of those presented to the Court on February 3, 2011, or otherwise. Without the
20 requested information, Spivak has no way to know whether or how Stein responded to the
21 voicemails and emails Spivak forwarded to him.
22 In turn, clients who may have retained the team based in whole or in part on Spivak’s
23 participation may not know what has proceeded – or, if Stein has replaced Spivak in those
24 agreements, may not realize why that occurred or the implications thereof.
25 None of Spivak, Jones, Tomaszewski, SML, Apex, or Spivak Law Group has ever been
26 paid by or on behalf of any plaintiff or prospective plaintiff in this action; to the contrary, each of
27 the foregoing has expended their own funds and thousands of hours. Based upon reports to the
28
Moving Parties, Stein has collected fees and overhead directly and indirectly from clients,
14
1 TOMASZEWSKI DECLARATION
2 I, Christopher Tomaszewski, declare that:
3 1. I have personal knowledge of the following facts. If called to testify, I could and
4 would competently testify thereto based upon my personal knowledge.
5 1. I am an attorney at law duly licensed to practice before all courts of the State of
6 California. I am a partner in Apex Legal Group PC (“Apex”). I have been a partner in Apex and
7 Apex has been a counsel of record in the Ronald action since the filing of the lawsuit on March
8 12, 2009. 1
9 Procedural Background
10 2. On March 12, 2009, 17 individuals filed a complaint in this action in Los Angeles
11 County Superior Court. Sixteen of the original 17 plaintiffs were Apex clients. Apex and Stein
12 were introduced by Stein’s wife, the 17th client, after she was referred to Apex for help with a
13 loan modification request. The bank refused to issue any modification or relief. Thus, Apex and
14 Stein agreed to work together on a lawsuit. The caption on the complaint showed the counsel for
15 all Plaintiffs as being Bridget Jones (“Jones”), Stein and me.
16 3. On or about June 12, 2009, 44 named plaintiffs lodged with the Court a proposed
17 First Amended Complaint (“FAC”). 43 clients were originated by Apex and one client by Stein,
18 though because counsel agreed to work together, no distinction was made. The caption again
19
showed the counsel for all Plaintiffs as being Jones, Stein and me.
20
4. On March 26, 2010, Plaintiffs filed their Second Amended Complaint (“SAC”). The
21
SAC consisted of 41 named Plaintiffs and retained the same caption as the prior complaints.
22
5. On May 14, 2010, on behalf of his clients and others, Kenin M. Spivak (“Spivak”)
23
proposed to intervene in this action because, he alleged, no progress had been made in getting a
24
good complaint on file. Judge Jones denied the application because it had been made ex parte.
25
6. Following rejection of the intervention, after consultation among counsel and with
26
27
1
In submitting this declaration, the declarant does not intend to waive and does not waive any
28 privileges, including, without limitation, work product protection.
1
TOMEZEWSKI DECLARATION
1 Apex’s approval, Stein invited Spivak to join the case as co-lead counsel with specific
2 responsibility regarding pleadings and research. Stein retained leadership of discovery,
3 procedures and certain administrative matters. Separately, Stein recruited Erikson Davis
4 (“Davis”) pursuant to a financial arrangement between them.
5 7. On May 24, 2010, Plaintiffs named James Agate as a defendant by Doe amendment.
6 Thereafter, Agate’s counsel, Phillip Kramer, exercised a CCP §170.6 peremptory challenge to
7 Judge Jones. The Defendants objected to the preemptory challenge, among other things
8 observing a prior relationship between Stein and Kramer. That objection was overruled by Judge
9 Carl West. The Ronald Action then was assigned to this Court.
10 8. Consistent therewith, on June 21, 2010, Plaintiffs filed an ex parte application for an
11 Order to Show Cause and for a Temporary Restraining Order. The Court denied the application.
12 The lawyers on that caption – for all Plaintiffs - remained the lawyers on the caption of all filings
13 in the Ronald action until about a month ago. Those lawyers were: Spivak, Stein, Jones, Davis
14 and me. About a month ago, Ted Maloney (“Maloney”) was added to the caption as an SML
15 LLP (“SML”) attorney. As I had been aware for many months as a result of our email
16 interaction, Maloney had been assisting Spivak since about the time Spivak joined the case. The
17 caption again changed far more profoundly when Stein and Davis secretly filed several pleadings
18 with the Court of Appeals, as described below, deleting Spivak, Jones, Maloney and me – and
19
adding Michael S. Riley (“Riley”), a stranger to this action.
20
9. On June 14, 2010, this Court ordered the plaintiffs to file a Third Amended
21
Complaint (“TAC”). Spivak was the principal drafter of the TAC, assisted primarily by
22
Maloney, though all members of the legal team also contributed to, and approved of, the product.
23
The TAC, filed on July 7, 2010, named 249 plaintiffs. Spivak prepared engagement agreements
24
to be used by Stein-Spivak and Apex, drafts of which were circulated among Spivak, Stein,
25
Jones and me and approved by all of us. The agreements drafted by Spivak did not require any
26
plaintiff to pay a retainer or to reimburse costs, unless the action was successful.
27
10. Apex has never been paid for or by any client to be included in the Ronald action.
28
To the contrary, we have expended considerable sums and thousands of hours, none of which
2
1 will be reimbursed unless there is a recovery, or some other source of money.
2 11. I estimate that of the 249 named plaintiffs in the TAC, Apex originated 128 clients,
3 Spivak alone originated about 10 clients, Stein alone originated two clients (his wife and one
4 other), Davis originated one client and the Stein-Spivak collaboration originated about 110
5 clients.
6 12. On August 2, 2010, the Defendants lodged a Notice of Removal. Spivak directed
7 the successful effort to remand the case, including being the principal drafter of the remand
8 motion and reply, and arguing the motion before Judge Real.
9 13. After the case was remanded, Spivak similarly directed the response to BofA’s
10 demurrer and motion to strike and was the principal drafter of Plaintiffs’ opposition and reply.
11 He then successfully argued the motion in this Court, resulting in the Court’s overruling the
12 BofA’s demurrer in all material respects. However, the Court certified for interlocutory review a
13 writ by BofA with respect to the TAC’s first cause of action. BofA filed its petition for that writ
14 on or about March 11, 2011 (the “BofA Petition”).
15 Organization of Legal Team
16 14. When the Ronald action was filed, Apex agreed with Stein that Stein would be lead
17 counsel in court, subject to there being full and complete consultation with Apex and Apex
18 managing relationships with the Apex-originated clients. There were many discussions about
19
financial splits. In May 2010, when Spivak joined the legal team, I proposed to have all lawyers
20
sign an agreement. Stein refused. He insisted that “our agreement” stood without involving
21
Spivak. Stein thereafter repudiated our agreement. Stein and I finally again reached agreement
22
on September 16, 2009, though Stein again refused to put our agreement in writing. He then
23
again repudiated our agreement and proposed unacceptable terms. To this day, Stein has refused
24
to agree to our financial arrangements and as recently as a few weeks ago emailed me to advise it
25
was “unlikely” he would agree to put anything in writing.
26
15. Nonetheless, by oral agreement and practice of the legal team – until the repudiation
27
of our agreements and practices by Stein and Davis over the last month – all plaintiffs have been
28
jointly represented by all counsel. At first, that meant Apex and Stein. Later, Spivak and Davis
3
1 joined the team and then Maloney. Generally, Davis works for Stein and has also assisted
2 Spivak, while Maloney generally works with Spivak, though he has also assisted Stein.
3 However, to the best of my knowledge, until February (and excluding client solicitations) all
4 team members have contributed to court filings and other important aspects of the case and all
5 team members have approved of the actions of which we have had prior knowledge.
6 16. As the originating counsel for a majority of the plaintiffs, Apex designates (and has
7 the right to withdraw) “lead counsel” positions. At first, Apex designated Stein. Then, at Stein’s
8 recommendation and based on Apex’s independent investigation of Spivak, Apex agreed to split
9 the lead counsel position between Stein and Spivak because it would serve the best interests of
10 our clients. Events and Spivak’s temperament, wisdom and consultative nature since that time
11 more than justified our confidence in Spivak. By contrast, events and Stein’s temperament,
12 methodologies and threats have raised grave doubts about Stein’s transparency, civility,
13 collaboration and ability to lead.
14 17. Commencing in or about late November, I noticed a deterioration in Stein’s
15 relationship with Spivak. On a number of occasions, Stein sent the legal team agitated,
16 inappropriate and false attacks on Spivak.
17 18. Following the February 3, 2011 Court hearing in which BofA expressed concerns
18 regarding Kramer, Stein and K2, I expressed my concerns to Stein. Thereafter, Jones and I
19
decided to affiliate with SML LLP as “of counsel” while continuing Apex as a separate law firm.
20
19. At about the same time, Spivak had requested the legal team’s support with respect
21
to certain matters necessary to prepare the Fourth Amended Complaint (“4AC”). Apex and
22
Spivak worked closely to develop the necessary information. Stein at first ignored the process,
23
then told us he had taken care of what was needed and then purported to instruct Apex not to
24
contact clients Apex or Spivak had originated because he (Stein) already had the needed
25
information. To the best of my knowledge, Stein never supplied the information to the team.
26
20. Thereafter, Stein – as he had done throughout our financial negotiations – became
27
abusive. He threatened to sue Apex and me. At times, he refused to communicate with me and
28
at other times he would call repeatedly as though he was my best friend. Among other things,
4
1 Stein insisted that Apex was responsible for Stein’s failure to deliver the information he told the
2 team he had already had, insisted that Apex come off the caption of the case and threatened to
3 sue Apex and me for manufactured slights, all in an effort to push Apex out of the case.
4 21. Stein has repeatedly made it clear to me that if he is challenged, he will do whatever
5 is necessary to win. He has threatened that clients and others will sue me.
6 Allocation of Responsibility
7 22. Spivak performed enormous amounts of work and has been assiduous in consulting
8 with co-counsel regarding his contributions and output.
9 23. By contrast, on February 9, 2011, without prior consultation with me – and to the
10 best of my knowledge without prior consultation with Jones or Spivak – Stein and Davis sent a
11 notice to BofA counsel for a proposed ex parte regarding the addition of 394 plaintiffs to the
12 Ronald action. I have no idea as to the provenance of these clients or any matters pertaining to
13 the terms on which they have engaged counsel. Until I am comfortable as to the foregoing, I do
14 not consent to their addition to the case.
15 24. Until February 28, 2011, each member of the legal team had been accorded the
16 opportunity by the other members of the legal team to review, comment on and approve all key
17 motions and other court filings. As a result, each member of the legal team has shared
18 responsibility for development of strategy and court filings. We were a true team.
19
25. Then for the first time – ever – since the inception of the Ronald action, I
20
was not given any opportunity to review or approve the following key motions: (1) the
21
application for a temporary restraining order filed by Stein and Davis on or about February 28,
22
2011which pertains to Apex-originated clients. (The Court denied the application and certified it
23
for a writ.); (2) pro hac vice applications apparently filed by Stein, Davis and Riley with the
24
Court of Appeals regarding Riley on or about March 14, 2011; (3) a “Preliminary Opposition
25
(and Memorandum) in Response to Defendants’ Petition and Peremptory Writ of Mandate or
26
Other Appropriate Relief” (“Preliminary Opposition”) filed by Stein, Davis and Riley on or
27
about March 15, 2011 pertaining to the Bank of America (“BofA”) petition for a writ; and (5) a
28
petition for a writ (the “TRO Petition”) filed on or about March 15, 2011 by Stein, Davis and
5
1 Riley regarding the Court’s decision denying to the February 28 TRO application.
2 26. When I finally reached Stein by phone, he denied having received the many emails
3 Spivak sent the team (including Stein, Davis and me) regarding his suggestions for the TRO
4 Petition, the status of the TRO Petition draft and the timing of Spivak’s review of the draft. He
5 also denied recalling any conversations with Spivak agreeing to share the briefing
6 responsibilities with Spivak.
7 27. Stein’s lack of recall of emails, conversations and events makes it very difficult to
8 work as a team in the best interests of our clients. Further, these attributes are inconsistent with
9 leadership.
10 28. I expected all key correspondence and court filings to be reviewed by Spivak.
11 Spivak’s apparent exclusion was diametrically contrary to my wishes and the best interests of our
12 clients, in that it deprived them of Spivak’s perspective and talents.
13 29. Neither Apex nor I were sent any drafts or the final version of the Riley applications,
14 Preliminary Opposition or TRO Petition, despite my repeated requests for those documents and
15 Spivak’s repeated requests, on which I was copied. Further, neither Apex nor I were formally
16 served with any of the foregoing filings, except that I did receive by email a copy of one of the
17 Riley applications.
18 30. None of Stein, Davis or Riley consulted with me regarding adding Riley to the
19
Ronald legal team or Riley’s application for admission pro hac vice. I have never met Riley, nor
20
had any interaction with him of any nature. To the best of my knowledge he has never rendered
21
any services with respect to the Ronald action. I do not consent to his addition to the team.
22
31. Then, Stein carried out his threat to delete Apex from the caption of the Appeals
23
Court filings. He also deleted Jones, SML, Spivak, Maloney and me. In our place, he inserted
24
Riley – a person who, to my knowledge, has nothing to do with this lawsuit. I am not aware of
25
any valid reason for our exclusion or Riley’s inclusion.
26
32. On Sunday night, March 27, 2011, Stein sent an email to Davis, Spivak and me
27
seeking assistance with respect to a matter related to the TRO Petition. He attached a PDF of an
28
unsigned version of the TRO Petition to that email.
6
1 33. I have been advised by prospective clients that Stein is charging retainers for
2 inclusion in the Ronald case. No such change in business model was discussed with me or
3 approved by me. Assuming, however, that the model is being implemented lawfully, Apex is
4 entitled to participate in such revenue as co-counsel.
5 34. We have received phone calls from clients who have expressed concern about the
6 information on the internet about Stein and Kramer, as detailed in certain consumer alert blogs.
7 Our clients have questioned whether Stein is acting in their best interests. This concern hampers
8 our ability to work with clients. By not knowing all of the relevant facts on a “real time” basis,
9 we are made to look untruthful in front of our clients, to the detriment of the team‟s relationship
10 with the clients and hence, to the detriment of our ability to represent our clients.
11 35. The legal team has fractured into a group that includes Apex, SML and most of the
12 clients on one side and a group that includes Stein and Davis on the other. Apex does not believe
13 the breaches in agreement, decorum or professional conduct are reparable. Apex therefore
14 withdraws its consent that Stein be a lead counsel in this action and further withdraws consent
15 that Stein continue to represent our clients, absent a contrary instruction from any client.
16 36. Together with Spivak, Maloney and the experienced senior litigators Spivak has
17 attracted to SML and, if necessary, other counsel we can attract, Apex believes that SML and
18 Apex can properly represent the interests of our clients and can do so within the bounds of the
19
professional standards that govern lawyers in California.
20
21
I declare under penalty of perjury that the foregoing is true and correct. Executed on March
22
27, 2011, at Sacramento, California.
23
24
25 ____________________________
Christopher Tomaszewski
26
27
28
7
1 SPIVAK DECLARATION
2 I, Kenin M. Spivak, declare:
6 California. I am co-lead counsel for Plaintiffs in the Ronald Action.1
7 Background
8 4. In early 2010, I learned of the Ronald action. On behalf of my clients and others, I
9 sought to intervene because no progress had been made in getting a good complaint on file.
10 Judge Jones denied the application because it had been made ex parte.
11 5. Thereafter, Mitchell J. Stein (“Stein”), Christopher Tomaszewski (“Tomaszewski”)
12 and Bridget Jones (“Jones”) asked me to join their legal team as co-lead counsel responsible for
13 directing pleadings and research. I joined the Ronald action shortly before the case was assigned
14 to this Court in or about late May 2010. As co-lead counsel, with exceptions from late February
15 2011, I have developed key theories, directed most research, coordinated participation from other
16 team members, drafted or revised nearly all filings and argued key motions in court. Stein has
17 participated to varying degrees in the foregoing activities.
18 6. Conversely, I have participated to varying degrees in Stein’s areas of responsibility,
19
which include discovery, procedures, certain client relations matters and certain administrative
20
matters. For example, I prepared certain of our discovery requests and worked with an
21
accountant selected by Stein to assist in back-end support.
22
7. Importantly, until February 2011, the effort had been a group effort. To properly
23
represent the interests of our clients, this effort requires cooperation, support, transparency,
24
timeliness, diligence, focus and support of all co-counsel members. From May 2010 and until
25
February, 2011, to the best of my knowledge and recollection, all counsel contributed to
26
27
1
In submitting this declaration and the exhibits hereto, the declarant does not intend to waive
28 and does not waive any privileges, including, without limitation, work product protection.
1
SPIVAK DECLARATION
1 substantially all aspects of the case, consulted on and approved of each other’s material
2 contributions to the case and jointly developed and executed strategy.
3 8. Both Stein and I have asserted to the other that the “other” has not lived up to
4 commitments regarding various matters. That, along with other factors described herein, has
5 caused my relationship with Stein to deteriorate to the point that Stein has repeatedly threatened
6 clients or others will sue me, or that they – or he – otherwise reserve their rights, with respect to
7 almost every matter as to which I have assisted Stein, his family and his businesses.
8 9. I have observed Stein’s relationships with Tomaszewski and Jones rapidly
9 deteriorate to the point he insisted their names come off the caption of the case and he refused to
10 communicate with them. I have observed Stein’s relationship with my colleague Ted Maloney
11 (“Maloney”), a senior lawyer with whom Stein also had a close relationship, collapse amid
12 Stein’s acerbic attacks in emails copying third parties.
13 10. While the legal team may be meeting and exceeding all requirements for a lawyer’s
14 service to a client, that will not continue to be true with the current ruptures. If the lawyers on a
15 joint prosecution team can’t work together, or some of the lawyers refuse to provide copies of
16 Court filings to other lawyers, or if there is no agreement on the financial or management
17 arrangements among the lawyers, it is only a matter of time before the clients suffer.
18 The Relationship Frays
19
11. Commencing in or about November 2010, I noted Internet postings linking Stein,
20
Phillip Kramer, K2 and others to solicitations of clients. These solicitations contained false
21
claims about the Ronald action. I also received reports of so-called marketing agents being paid
22
to solicit clients and large retainers being charged to potential plaintiffs in the Ronald action. I
23
discussed the foregoing with Stein and made clear my opposition to any improper marketing
24
efforts.
25
12. Stein denied any wrongdoing and denied he had received any retainers. He twice
26
arranged for a meal with Phil Kramer. My recollection is that the first lunch occurred before I
27
observed these postings. Kramer and I had a private lunch in Sherman Oaks. We discussed the
28
potential to work together, but concluded that we should not do so, though we would stay in
2
SPIVAK DECLARATION
1 touch. The second meeting occurred among Kramer, Stein and me in Calabasas after a
2 prospective client had sent me an inaccurate mailing he had received. Kramer agreed to look
3 into my concerns.
4 13. Subsequently, Stein offered to arrange for me to meet with Kramer to explore my
5 concerns and whether SML or I would be interested in being engaged by Kramer or otherwise
6 participating in his law firm. Kramer and I scheduled a meeting, but Stein cancelled the meeting
7 on December 6, 2010, after I made clear that while I personally like Kramer, I would have no
8 interest in working with him if it turned out that his client solicitations violated professional
9 standards or law. Although neither Stein nor Kramer have admitted to me any violation of any
10 law or ethical obligation – and in fact both Stein and Kramer have denied any violations – my
11 strong position on this issue was apparently off-putting.
12 14. Thereafter, I advised Stein: that: (1) no client could become a client in this action if
13 there was uncertainty about that client’s provenance, (2) as to clients with an appropriate
14 provenance, after provision for a reserve for litigation costs, Stein and I were both entitled to
15 share in any retainers in accordance with our understandings, and (3) I needed copies of all
16 Stein-Spivak retainer agreements and an accounting of any income thereunder.
17 15. Stein refused to comply. On December 21, 2010, for the first time, Stein insisted all
18 clients except approximately 30 originated by me were his clients and that providing copies of
19
the agreements or an accounting would violate attorney-client privilege. Stein also advised me
20
that my positions could violate my fiduciary duties and subject me to claims.
21
16. Since late last year, Stein has become increasingly abusive and inconsistent in his
22
promises, demands and actions. The situation has materially worsened since the February 3,
23
2011 Court hearing in which BofA expressed concerns regarding Kramer, Stein and K2. After
24
that hearing, I again expressed concerns to Stein regarding client solicitations and his failure to
25
provide information on the Stein-Spivak clients.
26
17. Thereafter, Stein at various times refused to communicate with one or more of
27
Jones, Tomaszewski and me and at various times threatened legal action against some or all of
28
us, Apex Legal Group PC (“Apex”), Maloney and SML LLP (“SML”). At times, he appeared to
3
SPIVAK DECLARATION
1 be threatening he would sue us and at other times he appeared to be threatening that “clients”
2 would sue us. It was never quite clear what our alleged sins were, other than disagreeing with
3 Stein as to case management, client solicitations, the allocation of any retainers properly
4 obtained and the allocation of any fees resulting from a settlement or judgment.
5 18. Further, Stein and his associate Erikson Davis (“Davis”) have abrogated the
6 agreements and practice among counsel by issuing ex parte notices and filing critical pleadings
7 in this Court and in the Court of Appeals without consulting with me or, to my knowledge, any
8 other team members. Stein and Davis refused to provide copies of recent Court of Appeals
9 filings to the Apex or SML lawyers in violation of the legal team’s agreement, practice, common
10 sense and Court of Appeals rules. Stein and Davis went so far as to delete the Apex and SML
11 lawyers from the caption of filings in the Court of Appeals and to insert the name of a Florida
12 businessman (admitted to practice in Florida), Michael S. Riley (“Riley”), who has nothing to do
13 with this case.
14 19. On February 9, 2011, without prior consultation with me, Stein and Davis sent a
15 notice to BofA counsel for a proposed ex parte regarding the addition of 394 plaintiffs to the
16 Ronald action. I have no idea as to the provenance of these clients or any matters pertaining to
17 the terms on which they have engaged counsel or whether they have signed some variant of the
18 Stein-Spivak engagement letter. Until I am comfortable as to the foregoing, I do not consent to
19
their addition to the case.
20
20. In connection with the preparation of the 4AC, Stein claimed that he had taken care
21
of certain important matters, but then failed or refused to provide the results for use in the 4AC.
22
He blamed the failure on Apex, even though he had specifically assumed responsibility and
23
“instructed” Apex to stay out of it. In connection with a separate matter for which Stein was
24
responsible and which he did not attend to (which may not have been due to any neglect or
25
wrongdoing on his part), he asserted that it was somehow my fault.
26
21. During a hearing on March 9, 2011, Stein advised the Court that he intended to
27
move for Riley’s admission to appear pro hac vice. Stein referred to Riley as the former head of
28
the antifraud division of Florida. Stein issued a press release on March 21, 2011 that repeated
4
SPIVAK DECLARATION
1 this assertion. See Exhibit B, a true and correct copy of that press release I downloaded on
2 March 24, 2011 from www.mjsteinassocaites.com/blog/index.php?p=219.
3 22. Riley was introduced to me by Maloney. We had lunch early this year in
4 Calabasas. Maloney and Riley told me that Maloney had introduced Riley to Stein. Riley told
5 me that he was thinking of working with Stein on litigation in Florida. He told me that early in
6 his career he was a junior prosecutor and laughed that Stein persisted in telling people that he
7 had been head of an antifraud division. Published Riley biographies I have read do not indicate
8 that he was head of a Florida antifraud division. I met Riley on two additional occasions. Riley
9 explained that he had been staying in California to undertake various business projects.
10 23. At no time did Stein or Riley consult with me regarding Riley’s proposed
11 involvement in this action.
12 24. From the time I joined the legal team and until February 2011, to the best of my
13 recollection, each member of the legal team had been accorded the opportunity by the other
14 members of the legal team to review, comment on and approve all motions and other court
15 filings.
16 25. On February 28, 2011, Stein and Davis filed an application for a temporary
17 restraining order (“TRO Application”) with respect to imminent foreclosures against certain of
18 the Apex-originated plaintiffs. Stein informed me that Davis was adapting a preliminary
19
injunction motion I had written and assured me that I would have ample time to review and “vet”
20
the draft TRO Application in accordance with the legal team’s agreement and practice.
21
26. Instead, Davis filed the TRO Application without my review. The Court denied the
22
TRO Application and certified the decision for interlocutory review.
23
27. Following the March 2, 2011 hearing, Stein and I agreed that Stein would write the
24
first draft of a petition (i.e., the “TRO Petition”) for my review, oversight of additional research,
25
revisions and approval. I started by researching the cases that had been located by Stein’s office
26
for the TRO Application and provided to the team my analysis, an outline of issues to be
27
researched for the TRO Petition and potential bases for the writ.
28
28. Following a hearing in this Court on the Defendants’ motion to compel and for
5
SPIVAK DECLARATION
1 sanctions against Stein, Stein advised me that the draft TRO Petition would be sent to me by
2 Thursday evening (March 10, 2011) or Friday morning (March 11, 2011), at “the latest.” When I
3 did not receive the draft, I repeatedly emailed and texted Stein inquiring as to the status of the
4 draft. Stein never responded.
5 29. Over the last few months, in an effort to isolate the Ronald action from the broader
6 disagreements between Stein and me, I sought to put into writing the financial terms on which
7 the legal team in Ronald is proceeding. At times Stein has agreed to do so – and even offered to
8 do so. As recently as this month he advised me that he had drafted agreements for our financial
9 arrangements pertaining to the Ronald action and would deliver the agreements to me. However,
10 no such agreements have been delivered. In emails to the team, Tomaszewski has asked for a
11 written agreement specifying the team’s financial terms, including a request emailed to all
12 counsel on March 6, 2011. Stein responded that his signing a written agreement was “unlikely.”
13 30. Without any prior notice or opportunity to review: (1) on March 14, 2011, Stein and
14 Davis filed the Riley Applications; (2) on March 15, 2011, Stein, Davis and Riley filed a so-
15 called “Preliminary Opposition (and Memorandum) in Response to Defendants’ Petition and
16 Peremptory Writ of Mandate or Other Appropriate Relief” (the “Preliminary Opposition”); and
17 (3) on March 15, 2011, Stein, Davis and Riley filed the TRO Petition.
18 31. On March 15, 2011, Jones sent me a copy of a Riley Application emailed to her by
19
Davis. Davis’ forwarded email does not show me as an intended recipient. Later that day, I
20
called Davis to coordinate his research support for a response to the BofA Petition. As a casual
21
aside, Davis told me the Preliminary Opposition and TRO Application had been filed. I
22
requested copies, which he agreed to send. I followed up with an email.
23
32. Despite my thereafter emailing and texting repeated requests to Stein and Davis for
24
copies of the filings and my receiving a second promise from Davis’ to send the filings in a
25
telephone conversation at approximately 9 AM on March 16, 2011, none of Stein, Davis or Riley
26
ever provided any of the documents filed with the Appellate Court to SML or me, or to my
27
knowledge, to Apex (excluding the Riley Application emailed to Jones and Tomaszewski by
28
Davis).
6
SPIVAK DECLARATION
1 33. On Monday, March 21, 2011, I made a final effort to obtain the filings from Stein
2 and Davis. Stein’s response was an emphatic “pound sand” as is seen in the email thread
3 annexed hereto in Exhibit A, which is a true and correct copy of an email thread containing
4 emails between Stein and me. Instead of sending the filings, Stein warned me that “many of the
5 Ronald clients have or shall imminently file suit against SML and Apex.” Stein later emailed me
6 to deny the accuracy of my response, deny involvement in the actions to be taken by clients and
7 “explain” that the writs constitute a separate case.
8 34. When all efforts to obtain the filings from Stein and Davis failed, I arranged for a
9 paralegal and copying service to go to the Court of Appeals and copy the filings.
10 35. On Sunday night, March 27, 2011, Stein sent an email to Davis, Tomaszewski and
11 me seeking assistance with respect to a matter related to the TRO Petition. He attached a PDF of
12 an unsigned version of the TRO Petition to that email
13 36. BofA properly served the BofA Petition on Apex and SML. See Exhibit C, a true
14 and correct copy of the proof of service for the BofA Petition. After reviewing the filings
15 obtained by SML on March 21, 2011, I observed there were no proofs of service for the Riley
16 Applications. I also observed that Stein, Davis and Riley excluded all Apex and SML lawyers
17 from their service lists for the TRO Application and Preliminary Opposition. See Exhibit D a
18 true and correct copy of the proof of service for the TRO Application and Exhibit E, a true and
19
correct copy of the proof of service for the Preliminary Opposition.
20
37. Stein and Davis deleted from the captions of each of those filings the remaining
21
members of the Ronald legal team – Jones, Maloney, Tomaszewski and me. In our place, Stein
22
added to the caption a stranger to this action, Riley.
23
38. In a final effort to rectify things, I exchanged emails with Stein and Davis last week.
24
All was for naught. First, Davis sent me a draft of an Opposition to Motion for Leave to
25
Intervene Filed by Asset Guardian Plan, Inc. for my review, but then disregarded my response,
26
deeming it to be utimely. Then, after a flurry of emails regarding the mutually agreed premise
27
that it was important I participate in the drafting of status reports – and would do so – Davis on
28
Friday, March 25, 2011 filed a Status Report without providing a draft to the legal team for its
7
SPIVAK DECLARATION
1 review. I lack knowledge as to certain statements made in that Status Report and I disagree with
2 certain statements made in that Status Report. For example, I disagree with Stein being referred
3 to as lead counsel, rather than co-lead counsel.
4 Stein, Davis, Kramer and Riley Join Forces
5 39. Following the February 3, 2011 hearing, I stepped up my Internet searches
6 pertaining to Stein, Kramer and related matters. On or about February 26, 2011, my searches
7 turned up a legal marketing network/law firm named “Hartford Dunn.” I downloaded a “White
8 Paper” dated January 15, 2011. Exhibit F is a true and correct copy of the White Paper I
9 downloaded from the Hartford Dunn website at http://hartforddunn.com/ on February 26, 2011.
10 40. Also as a result of these searches, on March 19, 2011 I downloaded from the
11 California Department of Real Estate a “Consumer Alert” entitled “Fraud Warning Regarding
12 Lawsuit Marketers Requesting Upfront Fees for So-Called ‘Mass Joinder’ or Class Litigation
13 Promising Extraordinary Home Mortgage Relief.” A true and correct copy thereof is annexed
14 hereto as Exhibit G.
15 41. Late last year, Davis informed me that he had taken a job “in the Valley.” He never
16 disclosed to me the identity of his employer, instead repeatedly referring to his employer in
17 generic terms. Within approximately the last month, Maloney advised me that Davis was
18 employed by Kramer or a Kramer law firm. Stein later confirmed the foregoing. In the last few
19
weeks, I learned that much of Davis’ work is for Stein and that Davis and Stein have an office in
20
the same building.
21
42. I have received phone calls from clients and prospective clients who have expressed
22
concerns about Internet postings regarding Stein and Kramer. Regardless of whether Davis or
23
Stein have, in general, the right to do whatever they want to do without telling me, in light of the
24
fevered pitch of Internet concerns and the concerns of clients and prospective clients who call
25
me, my credibility is challenged by not knowing these facts. When lawyer’s credibility is
26
impaired, the ability of that lawyer and that legal team to service the client is also impaired.
27
Clients
28
43. In connection with the filing of the TAC and our efforts thereafter to add clients to
8
SPIVAK DECLARATION
1 the case, Stein, our families and I phoned individuals who had contacted us to determine their
2 interest in becoming named plaintiffs in Ronald and to assess if they were qualified based on
3 criteria established by Stein. At Stein’s suggestion, I prepared a joint Stein-Spivak engagement
4 agreement therefore (later modified). I estimate that a total of more than 100 plaintiffs in the
5 TAC, as well as many dozens of prospective plaintiffs for later amendments, were generated by
6 our joint efforts. I also prepared an agreement for Apex. After several drafts were circulated and
7 approved by Stein, Stein told me he was using the agreement for new clients.
8 44. Because I was so busy writing the TAC and with other litigation matters I had taken
9 over from Stein relating to his family and businesses, Stein agreed to take responsibility for
10 causing the Stein-Spivak agreements to be delivered to the clients, executed and processed. He
11 also said that he had an accountant who could run the back-room operation.
12 45. The Stein-Spivak and Apex agreements I drafted and all modifications thereto I
13 prepared did not require any plaintiff to pay a retainer or to reimburse costs, unless the action
14 was successful.
15 46. As a result of and following this process, one of Stein’s responsibilities was to liaise
16 with the new clients, while I attempted to get a good complaint on file and attend to my other
17 responsibilities. Throughout this period, Stein confirmed he had been collecting the Stein-
18 Spivak engagement agreements and keeping our clients informed of what was occurring.
19
47. From the filing of the TAC and until today, hundreds of potential plaintiffs emailed
20
or called me and other members of the legal team. Stein agreed that given my absorption in
21
other matters, he would continue to liaise with the potential new plaintiffs. I forwarded the
22
emails and voice messages I received to Stein for that purpose. Stein’s job was to call (or obtain
23
someone on his staff to call) these individuals, qualify them based upon his criteria and arrange
24
for qualified individuals to sign the last version of the Stein-Spivak engagement letter I had
25
created in August 2010. Stein confirmed on numerous occasions he was doing just that.
26
48. Neither SML nor I have ever been paid by or on behalf of any plaintiff or
27
prospective plaintiff in this action.
28
49. Based upon reports to me from potential clients and brokers, I believe that Stein
9
SPIVAK DECLARATION
1 modified the Stein-Spivak engagement agreement to include retainers and that he has received
2 retainers. Thereafter, based on the same reports, I believe he deleted me from the agreement and
3 continued to collect retainers. I have never received copies of the engagement agreements
4 delivered to Stein or an accounting, despite repeated requests to Stein therefore.
5 50. My point is not that retainers are per se wrong. To the contrary, absent violations of
6 ethics or law, retainers are a good thing and even a necessary thing given the substantial costs of
7 litigation. However, Stein never disclosed to me any such modifications, even in the Stein-
8 Spivak agreement and to this day will not disclose to me the information to which I am entitled.
9 Conclusions
10 51. The legal team has fractured into a group that includes Apex and SML on one side
11 and a group that includes Stein and Davis on the other. I do not believe the breaches in
12 agreement, decorum or professional conduct are reparable.
13 52. While Stein may assert the ruptures occurred because of my acts or failings and/or
14 Maloney’s acts or failings and/or Apex’s acts or failings and that he alone is the only hope for
15 the Ronald plaintiffs, that makes no sense.
16 53. Excluding Maloney and me, SML’s lawyers include two litigators each with more
17 than 25 years of experience, another lawyer who has served as lead counsel in 300 trials and
18 adversary proceedings and another lawyer who previously litigated for national firms. If
19
necessary, SML will supplement our lawyers to ensure the plaintiffs are competently and
20
zealously protected.
21
54. Regardless of who is responsible for casting the first stone or for the first mistake or
22
for the last stone or last mistake, the rupture is beyond dispute. As a result, co-counsel can no
23
longer act together in the best interests of our clients.
24
I declare under penalty of perjury that the foregoing is true and correct. Executed on March
25
28, 2011, at Beverly Hills, California.
26
27
28 Kenin M. Spivak
10
SPIVAK DECLARATION
SPIVAK DECLARATION
EXHIBIT A
Kenin M. Spivak
From: Kenin M. Spivak [KSpivak@SMLlawgroup.com]
Sent: Monday, March 21, 2011 12:50 PM
To: 'private.oceibod@gmail.com'; 'Erikson M. Davis'
Cc: 'Bridget Jones'; 'Christopher Tomaszewski'; 'Ted Maloney'
Subject: RE: Applications, Writs and Oppositions filed last week
Mitch

You clearly have lost it

First you and ) specifically agreed to jointly prepare the writ consistent with prior practice By excluding
me from the preparation of the writ you diminished the potential for it to succeed and violated the trust
of our clients

As to Brookstone you appear to be out of your mind Your assertion is as you know categorically false
and irrelevant to anything

You have unilaterally destroyed the team violated the rules of the Appellate Court and apparently
through defamatory mistruths induced clients to take malicious actions

Apparently your greed knows no bounds and you have elevated your self interest above your duty to the
Ronald clients and your obligations to the team

)f you proceed with legal actions the actions will be vigorously defended and will result in the
appropriate actions against you

The foregoing is not intended a s a complete statement of my or SML s rights remedies claims or
positions which are reserved

Kenin

Kenin M. Spivak
Managing Partner
SML Law Group
450 North Roxbury Drive, Seventh Floor
Beverly Hills, California 90210 U.S.A.
Tel: +1.310.691.5811
Fax: +1.310.691.5809
E-mail: kspivak@SMLlawgroup.com
IRS AND CONFIDENTIALITY NOTES:

To ensure compliance with requirements imposed by U.S. Treasury Regulations, we inform you that any U.S. tax advice
contained in this communication (including any attachments) was not intended or written to be used, and cannot be used,
for the purpose of (i) avoiding penalties under the Internal Revenue Code or (ii) promoting, marketing or recommending to
another party any transaction or matter addressed herein.
This message and its attachments are sent from a law firm and may contain information that is confidential and protected
by privilege from disclosure. If you are not the intended recipient, any disclosure, copying, distribution or use of this email
or any attachment is prohibited. Views expressed in this email are those of the individual sender unless the sender
1
specifically states otherwise. If you have received this email in error, please notify us immediately by returning it to the
sender and delete this copy from your system. Thank you for your cooperation.

From: private.oceibod@gmail.com [ mailto:private.oceibod@gmail.com]
Sent: Monday, March 21, 2011 12:40 PM
To: Kenin M. Spivak; 'Erikson M. Davis'
Cc: 'Bridget Jones'; 'Christopher Tomaszewski'; 'Ted Maloney'
Subject: Re: Applications, Writs and Oppositions filed last week

As I believe many of the Ronald clients have or shall imminently file suit against SML and Apex, and as the
writ is a different and new case, and as you reportedly either own or control Brookstone law which is being
sued by a Trustee in bankruptcy, I am certain you and Chris -- who were neither prepared nor capable of
protecting the clients with effective writ practice (i.e., had I died, no writ would have been or could have been
filed and indeed none was "in the works" by the Apex/SML team) -- understand the answer to the two of your
inquiries.
Sent from my HTC smartphone on the Now Network from Sprint!
----- Reply message -----

From: "Kenin M. Spivak" <KSpivak@SMLlawgroup.com>
Date: Mon, Mar 21, 2011 11:28 am
Subject: Applications, Writs and Oppositions filed last week
To: "'RC Admin'" <private.oceibod@gmail.com>, "'Erikson M. Davis'"
<erikdavis@att.net>
Cc: "'Bridget Jones'" <bridget@apexlegal.org>, "'Christopher Tomaszewski'"
<chris@apexlegal.org>, "'Ted Maloney'" <tmaloney@SMLlawgroup.com>
Mitch and Erik

Despite several requests last week from me and from Chris including my phone conversation with Erik
and whatever communications Chris or Bridget might have separately had with you ) have not received
copies of the filings you made last week in the Appeals Court Though copies were promised they have
never come

Please now send by email the filings if the exhibits are voluminous you can send the table of contents
and ) can then advise Erik if ) need any of the exhibits which presumably in all or almost all cases )
already have

As ) understand it you filed two applications to admit Riley a writ regarding the TRO and some kind of
opposition regarding the BofA writ ) am entitled to copies of all of the foregoing as is the entire team
and whether or not entitled to copies not that ) could imagine not being entitled to copies the failure
to provide copies can t possibly be in the best interests of our clients

Much the same information is necessary for the reply to the preliminary injunction motion and despite
characterizing the submissions as a masterpiece and it may be there might have been something left
out or a mistake made

) have neither received copies as of course as your co counsel nor have ) been officially served with
copies as required by the rules

2
Either way let s end this childishness with the simple attachment of some documents to an email and the
push of the button entitled send

Thank you

Kenin
Kenin M. Spivak
Managing Partner
SML Law Group
450 North Roxbury Drive, Seventh Floor
Beverly Hills, California 90210 U.S.A.
Tel: +1.310.691.5811
Fax: +1.310.691.5809
E-mail: kspivak@SMLlawgroup.com
IRS AND CONFIDENTIALITY NOTES:

To ensure compliance with requirements imposed by U.S. Treasury Regulations, we inform you that any U.S. tax advice
contained in this communication (including any attachments) was not intended or written to be used, and cannot be used,
for the purpose of (i) avoiding penalties under the Internal Revenue Code or (ii) promoting, marketing or recommending to
another party any transaction or matter addressed herein.
This message and its attachments are sent from a law firm and may contain information that is confidential and protected
by privilege from disclosure. If you are not the intended recipient, any disclosure, copying, distribution or use of this email
or any attachment is prohibited. Views expressed in this email are those of the individual sender unless the sender
specifically states otherwise. If you have received this email in error, please notify us immediately by returning it to the
sender and delete this copy from your system. Thank you for your cooperation.

No virus found in this message.

Checked by AVG - www.avg.com
Version: 10.0.1204 / Virus Database: 1498/3520 - Release Date: 03/21/11
3
SPIVAK DECLARATION
EXHIBIT B
Mitchell Stein, Esq. Files Mass Joinder Lawsuit Against Bank of America in Florida « Mitchell J. Stein & Associates
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Mar 24, 2011 admin No Comments
Mitchell Stein, Esq. Files Mass Joinder Lawsuit Against

Bank of America in Florida
M.J. Stein & Associates has filed a mass joinder lawsuit against Bank of America (BOA) in Florida,
another of potentially the most significant and precedent-setting legal actions taken against lenders as
a result of the national foreclosure crisis, it was announced today by Mitchell J. Stein, Esq. of Mitchell Sign me up!
J. Stein & Associates.
The Firm has filed suit in Florida in behalf of a mass joinder of plaintiffs seeking damages and
injunctive relief as a result of the Bank’s fraud and violations of the Deceptive Practices Act in Florida.
The Firm is co-counsel in the case with former State of Florida Fraud Chief Michael Riley, Esq. The
case is Brewer v. Bank of America, Fla. 17th Circuit 11004756.
CATEGORIES
The lawsuit alleges Bank of America (BOA) perpetrated a massive fraud, also constituting unfair
competition upon borrowers that devastated the values of their residences, resulting in the loss of net
Legal News (9)
worth, and that BOA intended to deprive numerous rights and remedies for the problems they caused
the borrowers.
Videos (1)
“The scale of fraud we allege was perpetrated by Bank of America in this case is the reason we are
working in partnership with Mike Riley, Esq., former State of Florida Fraud Chief. “Our case will prove
the Bank did not care about borrowers who would suffer from actions that would generate profits for ARCHIVES
them and allow them get out before the truth of their activities was exposed,” said Mitchell J. Stein,
Esq. “The fraud we allege resulted in a mortgage meltdown which has lead to decreased home March 2011 (4)
values throughout the state of Florida.
February 2011 (1)
According to court documents, the lawsuit claims the Bank disregarded underwriting standards and
implemented a massive fraud that was concealed from borrowers and other mortgagees on an January 2011 (5)
unprecedented scale. The lawsuit alleges that, as a result of the Bank’s actions, borrowers lost equity
in their homes, their credit ratings and histories were destroyed and they incurred unnecessary costs
and expenses. LINKS
Mr. Stein filed the suit along with former Florida State fraud chief Michael M. Riley. Brookstone Law
Mitchell J. Stein & Associates is also leading the landmark lawsuit, Ronald v. Bank of America, Los MJ Stein & Associates
Angeles Superior Court Case No. BC409444, the first mass joinder case filed against the banks
following the bank fraud and economic “meltdown” of the 2008, in which the Firm is representing
more than one thousand California consumers against attempted foreclosures by Bank of America. In NETWORKING
October 2010, Mitchell J. Stein & Associates obtained an order in favor of all clients and against the
Bank from Federal Judge Manuel Real who to one of the Bank’s arguments as “absurd” and threw the Register
Bank out of Federal District Court with respect to the case. On January 11, 2011, a Los Angeles
Superior Court Judge ruled that the Ronald case states valid causes of action against Bank of Log in
America allowing for discovery and depositions that are now being conducted as the case moves
forward in California State and Appellate Court. The case is rapidly moving forward in California State Entries RSS
and Appellate Court. The Firm is unaware of any mass joinder case in which the Court has accepted
the complaint and allowed Plaintiffs to proceed. Comments RSS
In addition to the landmark Ronald case, Mitchell J. Stein, Esq. has also filed lawsuits against other WordPress.org
major banks and lenders on behalf of aggrieved consumers including Locker v. Ally Bank, Superior
Court Los Angeles, BC409444. a mass joinder case against Ally Bank and its affiliates, formerly
http:/ / www.mjsteinassociates.com/ blog/ index.php?p= 219[ 3/ 24/ 2011 1:56:50 PM]

Mitchell Stein, Esq. Files Mass Joinder Lawsuit Against Bank of America in Florida « Mitchell J. Stein & Associates
GMAC, and Carlson v. J.P. Morgan, Superior Court Los Angeles, BC452262, a mass joinder case
against the J.P. Morgan Group on behalf of dozens of citizens and homeowners.
“Bad actors must be held responsible for the irreparable and massive damage done to people’s lives
and the State of Florida due to their unbridled greed and avarice,” said Mitchell J. Stein, Esq. “In this
case, we are representing thousands of homeowners who as a result of horrible practices have
wrongfully lost their homes or are facing wrongful foreclosure,” said Mitchell J. Stein, Esq.
ABOU T M I T CH ELL J . ST EI N & ASSOCI AT ES

Mitchell J. Stein & Associates is a California-based law firm founded by M.J. Stein, Esq. a 25-year
award-winning litigator, trial lawyer, financier, and entrepreneur who has represented many of the
world’s largest companies and has been involved in some of the highest profile cases in the Nation’s
history. The Firm’s philosophy is based on the belief that their clients’ needs are of the utmost
importance and, as a result, a high percentage of the Firm’s business has been from repeat
customers and referrals. The Firm’s practice areas include Complex Litigation, Bank Problems,
Mergers & Acquisitions, Commercial and Residential Foreclosures , and Bankruptcy Litigation. Mr.
Stein is also the founder of VIPS Foundation (Victims of Injustice Pain and Suffering), through which
victims nationwide, over the last 15-years, have received assistance following unfortunate events that
subjected them to oppression or mistreatment. In that regard, Mr. Stein received the inaugural Mitchell
J. Stein Benefactor Award from the National Organization for Victims Assistance (NOVA) for his work
in protecting victims’ rights. Visit http://www.mjsteinassociates.com or http://www.dobielaw.org for
more information.
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"YOU HOLD THE LEASH"

© 2010 MITCHELL J. STEIN & ASSOCIATES
http:/ / www.mjsteinassociates.com/ blog/ index.php?p= 219[ 3/ 24/ 2011 1:56:50 PM]

SPIVAK DECLARATION
EXHIBIT C
SPIVAK DECLARATION
EXHIBIT D
SPIVAK DECLARATION
EXHIBIT E
SPIVAK DECLARATION
EXHIBIT F
White Paper - January 15, 2011
Mortgage Litigation Affiliate Practice

Loan Modifications Do Not Work! As the last two years have demonstrated, banks across the United
States are dragging their feet in the hope that homeowners get frustrated with the negotiation process and give up.
This is unfortunate, because the United States Government advanced more than $1 trillion in TARP money so that
the banks would not drag their feet. Instead, banks took the TARP money and began grabbing land. The land grab
has not yet reached epidemic proportions because of the presence of trial lawyers throughout America. While all
this has been happening, banks are denying 94% of all modification requests. If the bank does give the homeowner
a modification, it will most likely save them only a couple of dollars a month, will not reduce the principal balance,
and the bank always reserves the right to welch on the modification and go back on it. Knowing that the banks are
the ones guilty of wrongdoing, the banks then turn the borrower s attention to the loan modification lawyer or
other professional by using multi-million-dollar lobbying firms to pass legislation or otherwise politically blame
those who are merely doing what the President of the United States, Congress and the banks said to do: Modify
their mortgages. If the homeowner paid a third party to perform a modification, their lender will call and tell the
homeowner lies like, No one is working on a modification for you. They are a scam! or You should demand your
money back. We can do this for you for free. It makes this process all the more frustrating for the homeowner
because the banks want the homeowner to give up.
Banks do not have a financial incentive to modify mortgages any longer. Banks would much rather foreclose on the
property today and get to liquidate it at a time of their choosing. Their alternative is to most likely foreclose on the
property a year from now at a substantially reduced market value (it is projected that property values will decrease
an additional 20% in 2011). Furthermore, once banks modify a mortgage (if that event ever happens), they must
reduce the value of the mortgage asset on their balance sheet, which may trigger audits from regulators like the
FDIC and ultimately may result in the bank becoming bankrupt or insolvent.
In this history of America, litigation has often been the only source of relief.
Going back to the beginning and heritage of America, trial lawyers were the only ones standing in the background
as a safety net for the American citizenry.
Page | 1
"This communication emanates from the Law Firm of Brookstone Law. All rights reserved. Copyright 2011.
Brookstone Law has licensed these materials from Mr. Riley and has a "Of Counsel" working relationship, accordingly
only Brookstone Law and Mr. Riley is authorized to disseminate the foregoing information."
Throughout our history, many of the most important and far-reaching advancements of American society have
been achieved through the work of trial lawyers fighting for the rights of citizens and consumers. Without the
tireless work of these conscientious trial attorneys, much of the positive progress of our society and the numerous
consumer protections we take for granted would likely not exist. From social policy to the safety and quality of
consumer products, many of the most celebrated and important achievements of American social progress have
been the result of the litigation by dedicated lawyers working within the system to help citizens realize their rights
and protections.
Examples of changes that fell into the trial lawyers safety net, we consider a few from the many: From Brown vs
Board of Education of Topeka, the landmark decision that declared separate public schools for black and white
students unconstitutional and paved the way for integration and the civil rights movement, to Roe Vs Wade, the
Supreme Court decision that established that a right to privacy extends to a woman's decision to have an abortion,
to the Tobacco Master Settlement Agreement of 1998 that settled Medicaid lawsuits in 46 states, curtailed tobacco
marketing practices, established annual payments to states to compensate them for medical costs of caring for
persons with smoking-related illnesses and funding a national anti-smoking advocacy group, litigation has made it
possible for us to progress as a nation and become a more equal, just and fair country under the Law.
With this backdrop, trial lawyers are where the American public is turning today. Many experienced legislators and
experts believe litigation may be the only alternative. Hartford Dunn, LLP has evaluated the problem and believes
that mortgage litigation represents the only viable alternative at this time in American history to protect
homeowners: The backbone of our society.
Benefits of Mortgage Litigation
Actual Lawsuit Is Filed Affordable Solution for Homeowners
Can Provide Real Results Takes the Power Away From Banks
Powerful Litigation Attorney Protect Your Home

Representation
Hartford Dunn, LLP has evaluated lawyers state-by-state and, in working with lawyers, has put together a turn-key
system that allows you to start offering mortgage litigation as a readily accessible solution in a matter of hours. In
conjunction with lawyers across the Country, Hartford Dunn, LLP provides all the required backend services to
support the litigation process. Our focus is on providing the very best customer service and attorney services for
companion law firms nationwide. I am very confident that we will be able to help you and I think you will quickly
Page | 2
see why our customers find our attorneys to be the experts when it comes to helping them get their financial issues
resolved. Hereafter, we invite your attention to the best and the brightest lawyers in this field from our
experience and research:
If you have any questions, call us and we will discuss a particular attorney with you.
Nothing in this list infers that Hartford Dunn, LLP is affiliated with any attorney.
Asterisks (*) Denote Particular, Unique and Heightened Experience or Skills.
* In our view, these are the top lawyers -- nationally -- in the area of bank litigation brought by members
of the general public.
STATE NAME AKA FIRM
CA *Mitchell Stein The Doberman
Mitchell Stein & Associates
*Philip Kramer
The General
Richard Kaslow
George Baugh The Gladiator Law Offices of George L. Baugh
Paul N. Taylor Taylor Law Group
Louis R. Skip Miller Miller Barondess
Luan Phan Phan Law Center
NY John Golden Albert Buzetti & Associates
Ginsberg & Katsorhis
Brian Murray Murray, Frank & Sailer Llp
Rheingold, Valet, Rheingold, Shkolnik &
Paul Rheingold
McCartney
Mitchell Pollack Mitchell Pollack & Associates
FL *Willie Gary
Andrew Needle Needle & Ellenberg
Mark Kaire Law Offices of Mark A. Kaire
James A. Ferraro The Ferraro Law Firm
TX Cynthia Chapman Caddell & Chapman
Page | 3
Louis Haki Miller Curtis & Weisbrod
*Richard Haynes Racehorse Richard Haynes & Associates
JC Bailey III Bailey & Galyen
Frank L. Broyles Goins, Underkofler, Crawford & Langdon
Jim Walker Walker & Crawford
Leonard Gabbay Leonard B Gabbay PC
IL Eric Brunick Freed & Weiss
*Daniel Edelman Edelman Combs Latturner & Goodwin
Warren S. George Keis George LLP
MA J. Michael Conley Kenney & Conley
George Keches Keches Law Group
*Keith Halpern Keith Halpern Law
Jeffrey Denner Denner Pellegrino, L.L.P.,
NV Kyle Kring Kring & Chung
M. Lani Esteban-Trinidad Esteban-Trinidad Law, P.C
---------------------------------
Daniel Allred Parsons Behle & Latimer
Barry Levinson Law Offices of Barry Levinson
MD Jeffrey M. Bloom The Law Offices of Jeffrey M. Bloom
PA Robert Huber Huber & Palsir
William Ballaine Landman Corsi Ballaine & Ford P.C
Patrick McDonnell The Law Offices of McDonnell & Associates
*Timothy Conboy Caroselli Beachler McTiernan & Conboy, L.L.C
Marc Scaringi Scaringi & Scaringi, P.C.
Robert Pierce Robert Peirce & Associates, P.C
Page | 4
Mortgage Litigation against Your Lender
With mortgage litigation, the homeowner will have attorneys on their side fighting for their rights in the US court
system. Banks will no longer have the power to make the decision as to what the homeowner will get.
The attorneys are using the leverage of the lawsuit to get results. Naturally, the attorneys follow the client s
instructions surrounding settlement of the litigation. In the event the client so chooses, they will attempt to settle
the suit for a principal reduction and rate reduction. If the bank will not settle, they will present this in front of a
jury and attempt to get the mortgage free and clear. Remember, banks are vilified in today s society. If bank
litigationmatters go to a jury trial, banks will be held accountable for the bad mortgages that were written and the
unresponsiveness they had in providing financial relief to the homeowners who were victimized.
Hartford Dunn, LLP has relationship with Law Firms that are taking the fight with us against the banks. We can
assess your case and see how many potential litigation cases you fit into based on your circumstances and profile.
We will continue to serve you on all cases you qualify for as a Plaintiff and this gives you more strength in numbers.
Law Firms With Active Cases of the Kind We Provide Backend Support
(Click on Defendant Company to view case detail)

Mitchell J. Stein & Associates Kramer & Kaslow
Los Angeles, CA Oceanside, CA
Defendant Company Defendant Company
Bank of America Citibank Corporation

GMAC Mortage Wells Fargo Bank, NA

JP Morgan Chase Bank One West Bank Group LLC
Page | 5
Guldenschuh & Associates Jon D. Pels, Esq., Lawrence J.
Georgia Anderson, Esq., Justin M. Reiner,
Esq. and Jennifer Schiffer, Esq.
Defendant Company Bethesda, Maryland
Defendant Company
HSBC Mortgage Corp.
Cuneo, Gilbert & LaDuca, LLP Frydman, LLC

Washington DC New York, New York
CitiGroup, Inc. & CitiMortgage Goldman Sachs, Hudson

Mezzanine Funding 2006-1 other
Hudson Funding entities, Peter
Ostrem, Darryl Herrick
Cohen & Malad, LLP Class Action Law Offices of Christie Arkovich
Attorneys Tampa, Florida
Indianapolis, Indiana
Defendant Company
Defendant Company
GMAC Mortgage
Bank of America
Susan Chana Lask E. Craig Smay, Esq. & John

New York, New York Christian Barlow
Salt Lake City, Utah
Defendant Company
Defendant Company
Stephen J Baum, Esq, Stephen
J. Baum, PC, MERS, HSBC others ReconTrust, MERS, BOA, BAC
(see complaint) Home Loan Servicing, HSBC, Wells
Fargo Bank, US Bank, Bank of New
York Melon, Keybank , Does 1-10
Law Offices of Heather Boone Forizs & Dogali, P.A.

McKeever Tampa, Florida
Lexington, Kentucky
Defendant Company
Defendant Company
Page | 6
Mers, GMAC, Deutsche, Bank of America
Nationstar, Aurora, BAC, Citi, US
Lanza & Smith, PLC The Ferraro Firm

Irvine,, California Miami, Florida
BAC home loans servicing,

Deutsche Bank National Trust, US
Bank National Association
Friscia & Associates Lieff Cabraser Heimann & Bernstein

Newark, New Jersey New York, New York
Bank of America Ocwen Federal Bank, Ocwen

Financial
Lauren Paulson Ebanks & Sattler, llp.

Aloha, Oregon New York, New York
Fairway Commercial Mortgage Chase Home Finance

Company, Fairway America,
FHLF,LLC, Skylands Investment
Corporation
Hagens Berman Sobol Shapiro Kenneth Eric Trent

LLP Oakland Park, Florida
Washington, DC, Washington DC
Defendant Company
Defendant Company
Aurora Loan Services Law offices of David Stern, MERS
Bank of America Figuerora vs Mers
Page | 7
Beneficial Program for Clients
Fee is a fraction of the cost of traditional litigation
Real results compared to modifications
Actual lawsuit filed against lender
Major law firm experience, skill and resources without sacrificing client-centric focus
Responsive, effective and accessible 24-7 customer service
Skilled legal counsel in national and international real estate law and litigation
Support from Hartford Dunn, LLP, specialists in litigation against banks
Opportunity to participate in mass joinder litigation gives individuals greater legal
leverage over banks and lenders
Staff and litigators trained in cost-containment and attention to detail
Experienced, aggressive litigation specialists dedicated to positive results for your case
The Mortgage Litigation Process
Evaluation Discovery Litigation Settlement /

Phase Phase Phase Trial Phase
Page | 8
Claims Against Lenders Include:
Malfeasance Statutory Violations

3rd-Party Beneficiary Claims Phantom Investors and Beneficiaries
Unfair Business Practices Fraudulent Foreclosure Practices
MERS Violations Identity Theft
Thousands of Americans have reclaimed their lives through mortgage litigation. Our network of attorneys
provides clients with all the information they need to make well informed decisions about their mortgage
situation. We are an industry leader in matching clients with qualified legal representation they need and deserve.
The banks have attorneys working hard on their sides, IT IS ABOUT TIME YOUR CLIENTS DO THE SAME.
Type of Clients Who Can Benefit:
Have been turned down for a loan mod. Have received previous modifications
Have multiple properties Are current on their mortgage
Have too much debt Facing foreclosure
Don t have a hardship Are in bankruptcy
Page | 9
Getting Started in the Hartford Dunn, LLP Affiliate Network:
1 Request a Hartford Dunn, LLP Agreement
2 Fill out, sign and send back the agreement
3 We will open up an online CRM account
4 Start submitting your business today
We will handle everything else. It is that easy!
On behalf of all Plaintiff lawyers in the United States attempting to ameliorate the wrongdoing of banks and
financial institutions from 2004 through 2011, I sincerely hope the foregoing information is helpful to you and I
invite you to contact us or any of the foregoing law firms in the event you wish to learn more about the
Litigation Solution.
Sincerely,
HARTFORD DUNN, LLP
Michael Riley, Director Bank Compliance
Page | 10
SPIVAK DECLARATION
EXHIBIT G
Galifornia Department of Real Estate
** COA'SUMER ALERT**
FRAUD WARNING REGARDING LAWSUIT MARKETERS REQUESTING UPFRONT

FEES FOR SO.CALLED "MASS JOINDER" OR CLASS LITIGATION PROMISING
EXTRAORDINARY HOME MORTGAGE RELIEF
By Wayne S. Bell
Chief Counsel, California Department of Real Estate
HOME MORTGAGE RELIEF THROUGH LITIGATION (and "Too Good to Be True"

Claims Regarding lts Use to Avoid and/or Stop Foreclosure, Obtain Loan Principal
Reduction, and to Let You Have Your Home "Free and Clear" of Any Mortgage).
This alert is written to warn consumers about marketing companies, unlicensed entities,
lawyers, and so-called attorney-backed, attorney-affiliated, and lawyer referral entities
that offer and sell false hope and request the payment of upfront fees for so-called "mass
joindef' or class litigation that will supposedly result in extraordinary home mortgage
relief.
The California Department of Real Estate ("DRE" or "Department") previously issued a

consumer alert and fraud warning on loan modification and foreclosure rescue scams in
California. That alert was followed by warnings and alerts regarding forensic loan audit
fraud, scams in connection with short sale transactions, false and misleading
designations and claims of special expertise, certifications and credentials in connection
with home loan relief services, and other real estate and home loan relief scams.
The Department continues to administratively prosecute those who engage in such fraud
and to work in collaboration with the California State Bar, the Federal Trade
Commission, and federal, State and local criminal law enforcement authorities to bring
such frauds to justice.
On October 11,2009, Senate Bill 94 was signed into law in California, and it became
effective that day. lt prohibited any person, including real estate licensees and attorneys,
from charging, claiming, demanding, collecting or receiving an upfront fee from a
homeowner borrower in connection with a promise to modify the borroweds residential
loan or some other form of mortgage loan forbearance.
Senate Bill 94's prohibitions seem to have significantly impacted the rampant fraud that
was occurring and escalating with respect to the payment of upfront fees for loan
modification work.
Also, forensic loan auditors must now register with the California Department of Justice
and cannot accept payments in advance for their services under California law once a
Notice of Default has been recorded. There are certain exceptions for lawyers and real
estate brokers.
On January 31 , 2011 , an important and broad advance fee ban issued by the Federal
Trade Commission became effective and outlaws providers of mortgage assistance relief
services from requesting or collecting advance fees from a homeowner.
Discussions about Senate Bill 94, the Federal advance fee ban, and the Consumer
Alerts of the DRE, are available on the DRE's website at www.dre.ca.oov.
Lawver Exemption from the Federal Advance Fee Ban --

The advance fee ban issued by the Federal Trade Commission includes a narrow and
conditional carve out for attorneys.
lf lawyers meet the following four conditions, they are generally exempt from the rule:
1. They are engaged in the practice of law, and mortgage assistance relief is part of
their practice.
2. They are licensed in the State where the consumer or the dwelling is located.
3. They are complying with State laws and regulations governing the "same type of
conduct the [FTC] rule requires".
4. They place any advance fees they collect in a client trust account and comply with
State laws and regulations covering such accounts. This requires that client funds
be kept separate from the lawyers' personal and/or business funds until such time
as the funds have been earned.
It is important to note that the exemption for lawyers discussed above does nof allow
lawyers to collect money upfront for loan modifications or loan forbearance services,
which advance fees are banned by the more restrictive Califomia Senate Bill 94.
But those who continue to prey on and victimize vulnerable homeowners have not given
up. They just change their tactics and modify their sales pitches to keep taking
advantage of those who are desperate to save their homes. And some of the frauds
seeking to rip off desperate homeowners are trying to use the lawyer exemption above to collect
advance fees for mortgage assistance relief litigation.
This alert and warninq is issued to call to vour attention the often overblown and
exaoqerated "sales pitch(es)" reqardinq the supposed value of questionable
"Mass Joinder" or Class Action Litiqation.
Whether they call themselves Foreclosure Defense Experts, Mortgage Loan Litigators,
Living Free and Clear experts, or some other official, important or impressive sounding
title(s), individuals and companies are marketing their services in the State of California
and on the Internet. Thev are makinq a wide varietv of claims and sales pitches.
and offerinq impressive soundino leqal and litiqation services. with quite
extraordinarv remedies promised. with the qoal of takinq and qettinq some of vour
monev.
While there are lawyers and law firms which are legitimate and qualified to handle
complex class action or joinder litigation, you must be cautious and BEWARE. And
certainly check out the lawyers on the State Bar website and via other means, as
discussed below in Section lll.
ll. QUESTIONABLE AND/OR FALSE CLAIMS OF THE SO.CALLED MORTGAGE LOAN

DEFENSE OR "MASS JOINDER" AND CLASS LITIGATORS.
A. What are the Claims/Sales Pitches?
They are many and varied, and include:

1. You can join in a mass joinder or class action lawsuit already filed against your
lender and stay in your home. You can stop paying your lender.
2. The mortgage loans can be stripped entirely from your home.
3. Your payment obligation and foreclosure against your home can be stopped when
the lawsuit is filed.
4. The litigation will take the power away from your lender.
5. A jury will side with you and against your lender.
6. The lawsuit will give you the leverage you need to stay in your home.
7. The lawsuit may give you the right to rescind your home loan, or to reduce your
principal.
8 The lawsuit will help you modify your home loan. lt will give you a step up in the
loan modification process.
9. The litigation will be performed through "powerful" litigation attorney
representation.
10. Litigation attorneys are "tuming the tables on lenders and getting cash settlements
for homeowners".
ln one lnternet advertisement, the marketing materials say, "the damages sought in your
behalf are nothing less than a full lien strip or in othenryords [sic] a free and clear house if
the bank can't produce the documents they own the note on your home. Or at the very
least, damages could be awarded that would reduce the principal balance of the note on
your home to 80% of market value, and give you a 2% interest rate for the life of the
loan".
B. Discussion.
Please don't be fooled by slick come-ons by scammers who just want your money. Some
of the claims above might be true in a particular case, based on the facts and evidence
presented before a Court or a jury, or have a ring or hint of truth, but you must carefully
examine and analyze each and every one of them to determine if filing a lawsuit against
your lender or joining a class or mass joinder lawsuit will have any value for you and your
situation. Be particularly skeptical of all such claims, since agreeing to participate in
such litigation may require you to pay for legal or other services, often before any legal
work is performed (e.9., a significant upfront retainer fee is required).
The reality is that litigation is time-consuming (with formal discovery such as

depositions, interrogatories, requests for documents, requests for admissions,
motions, and the like), expensive, and usually vigorously defended. There can be
no guarantees or assurances with respect to the outcome of a lawsuit.
Even if a lender or loan owner defendant were to lose at trial, it can appeal, and the
entire process can take years. Also, there is no statistical or other competent data
that supports the claims that a mass joinder and class action lawsuit, even if
performed by a licensed, legitimate and trained lawyer(s), will provide the
remedies that the marketers promise.
There are two other important points to be made here:
First, even assuming that the lawyers can identify fraud or other legal violations
performed by your lender in the loan origination process, your loan may be owned by an
-
investor that is, someone other than your lender. The investor will most assuredly
argue that your claims against your originating lender do not apply against the investor
(the purchaser of your loan). And even if your lender still owns the loan, they are not
legally required, absent a court judgment or order, to modify your loan or to halt the
foreclosure process if you are behind in your payments. lf they happen to lose the
lawsuit, they can appeal, as noted above. Also, the violations discovered may be minor
or inconsequential, which will not provide for any helpful remedies.
Second, and very importantly, loan modifications and other types of foreclosure relief are
simply not possible for every homeowner, and the "success rate" is currently very low in
California. This is where the lawsuit marketing scammers come in and try to convince
you that they offer you "a leg up". They falsely claim or suggest that they can guarantee
to stop a foreclosure in its tracks, leave you with a home "free and cleaf' of any
mortgage loan(s), make lofty sounding but hollow promises, exaggerate or make bold
statements regarding their litigation successes, charge you for a retainer, and leave you
with less money.
ilt. THE KEY HERE IS FOR YOU TO BE ON GUARD AND CHECK THE LAWYERS OUT
(Know Who You Are or May Be Dealing With) - Do Your Own Homework (Avoid
The Traps Set by the Litigation Marketing Frauds).
Before entering into an attorney-client relationship, or paying for "legal" or litigation
services, ascertain the name of the lawyer or lawyers who will be providing the services.
Then check them out on the State Bar's website, at www.calbar.ca.qov. Make certain
that they are licensed by the State Bar of California. lf they are licensed, see if they have
been disciplined.
4
Check them out through the Better Business Bureau to see if the Bureau has received
any complaints about the lawyer, law firm or marketing firm offering the services (and
remember that only lawyers can provide legal services). And please understand that this
is just another resource for you to check, as the litigation services provider might be so
new that the Better Business Bureau may have little or nothing on them (or something
positive because of insufficient public input).
Check them out through a Google or related search on the lnternet. You may be
amazed at what you can and will find out doing such a search. Often consumers
who have been scammed will post their experiences, insights, and warnings long
before any criminal, civil or administrative action has been brought against the
scammers.
Also, ask them lots of specific, detailed questions about their litigation experience, clients
and successful results. For example, you should ask them how many mortgage-related
joinder or class lawsuits they have filed and handled through settlement or trial. Ask
them for pleadings they have filed and news stories about their so-called successes. Ask
them for a list of current and past "satisfied" clients. lf they provide you with a list, call
those people and ask those former clients if they would use the lawyer or law firm again.
Ask the lawyers if they are class action or joinder litigation specialists and ask them what
specialist qualifications they have. Then ask what they will actually do for you (what
specific services they will be providing and for what fees and costs). Get that in writing,
and take the time to fully understand what the attorney-client contract says and what the
end result will be before proceeding with the services. Remember to always ask for and
demand copies of all documents that you sign.
tv. CONCLUSION
Mortgage rescue frauds are extremely good at selling false hope to consumers in trouble
with regard to home loans. The scammers continue to adapt and to modify their
schemes as soon as their last ones became ineffective. Promises of successes through
mass joinder or class litigation are now being marketed.
Please be careful, do your own diligence to protect yourself, and be highly suspect if
anyone asks you for money up front before doing any service on your behalf. Most
importantly, DON'T LET FRAUDS TAKE YOUR HARD EARNED MONEY.
######tt###
1 MALONEY DECLARATION
2 I, Ted Maloney, declare that:
6 California. I am a lawyer with SML LLP (“SML”), the senior partner of which, Kenin M.
7 Spivak (“Spivak”) is co-lead counsel for Plaintiffs in the Ronald Action. 1
8 3. Although I have only recently become a counsel of record, I have been one of the
9 lawyers for Plaintiffs in the Ronald Action for nearly 10 months. During that time, I have
10 worked closely with Spivak (“Spivak”) and at times, also with Mitchell J. Stein (“Stein”) and to
11 a lesser degree, also with Erikson Davis (“Davis”), Bridget Jones (“Jones”) and Christopher
12 Tomaszewski (“Tomaszewski”).
13 4. Effective as of the beginning of this year, I joined SML, a law firm established by
14 Spivak. My name was not on the pleadings in the Ronald action until very recently because my
15 prior firm consented to my assisting, but asked that I keep my name off the pleadings.
16 5. After I had been working primarily with Spivak regarding the Ronald case for
17 several months, late last year, Stein asked me to assist with respect to preparing discovery and
18 certain other matters. On a part-time basis over an approximately 45-day period, I performed
19
those services primarily in an office in the same suite as Stein and certain other lawyers I was
20
informed had been retained by Kramer.
21
6. I have known Michael S. Riley (“Riley”) for approximately 12 years. I
22
introduced him to Stein late last year while I was working with Stein. Over the last several
23
months, I have met Riley on numerous occasions in Los Angeles. During social events, Riley
24
has explained that he is in Los Angeles for various business endeavors, including with Stein.
25
7. Since learning of the finalization of my plans to join SML in December 2011,
26
27
1
28 privileges, including, without limitation, work product protection..
1
MALONEY DECLARATION
1 JONES DECLARATION
2 I, Bridget Jones, declare that:
6 California. I am a partner in Apex Legal Group PC (“Apex”). I have been a partner in Apex and
7 Apex has been a counsel of record in the Ronald action since the filing of the lawsuit on March
8 12, 2009. 1
9 3. As the originating counsel for a majority of the plaintiffs, Apex designates (and
10 has the right to withdraw) “lead counsel” positions. At first, Apex designated Stein. Then, at
11 Stein’s recommendation and based on Apex’s independent investigation of Spivak, Apex agreed
12 to split the lead counsel position between Stein and Spivak because it would serve the best
13 interests of our clients. Events since that time and more than justified our confidence in Spivak,
14 though events have raised grave doubts about Stein’s transparency and collegiality.
15 4. Spivak had requested the legal team’s support with respect to certain fact matters
16 necessary to prepare the Fourth Amended Complaint. Spivak and I worked closely to develop the
17 necessary information. Stein at first ignored the process, then told us he had taken care of what
18 was needed and then purported to instruct Apex not to contact clients. Stein never provided the
19
information he said he had.
20
5. Thereafter, Stein threatened to sue Apex. For a time, he would not communicate
21
with me. Among other things, Stein insisted that Apex was responsible for Stein’s failure to
22
perform that which he had told the team he had already achieved.
23
6. It has been my observation that Spivak performed enormous amounts of work and
24
was also assiduous in consulting with the other co-counsel regarding his contributions and
25
output. That is an important attribute in a team leader, i.e., a lead counsel.
26
27
1
28 privileges, including, without limitation, work product protection.
1
JONES DECLARATION
1 7. By contrast, on February 9, 2011, without prior consultation with me – and to the
2 best of my knowledge without prior consultation with my partner in Apex, Christopher
3 Tomaszewski, or Spivak - Stein and Davis sent a notice to BofA counsel for a proposed ex parte
4 regarding the addition of 394 plaintiffs to the Ronald action. I have no idea as to the provenance
5 of these clients and do not consent to their addition to the case.
6 8. Until February 2011, to the best of my recollection, each member of the legal
7 team had been accorded the opportunity by the other members of the legal team to review,
8 comment on and approve all motions and other court filings. I was not given any opportunity to
9 review or approve: (1) the application for a temporary restraining order filed by plaintiffs on or
10 about February 28, 2011, 2011; (2) pro hac vice applications apparently filed by Stein, Davis and
11 Michael S. Riley (“Riley”) with the Court of Appeals regarding Riley on or about March 14,
12 2011; (3) a “Preliminary Opposition (and Memorandum) in Response to Defendants’ Petition
13 and Peremptory Writ of Mandate or Other Appropriate Relief,” apparently filed by Stein, Davis
14 and Riley on or about March 15, 2011; or (4) a petition for a writ filed on or about March 15,
15 2011 by Stein, Davis and Riley regarding the Court’s decision pertaining to the March 1 TRO
16 application.
17 9. Neither Apex nor I were sent any drafts or the final version of the foregoing
18 filings. Further, neither Apex nor I were formally served with any of the foregoing filings,
19
except that I did receive by email a copy of one of the Riley applications. We obtained copies of
20
the Court of Appeals filings from SML after Stein again refused to provide copies by email on
21
March 21, 2011. I noticed that Spivak was not on the distribution list for that application and so
22
I forwarded it to him. We obtained copies of the Court of Appeals filings only after SML
23
engaged someone to go to court to obtain the documents.
24
10. I expected all key filings to be reviewed and directed by Spivak. Spivak’s
25
exclusion was diametrically contrary to our wishes and the best interests of our clients, in that it
26
deprived them of Spivak’s perspective and talents.
27
11. None of Stein, Davis or Riley consulted with me regarding adding Riley to the
28
Ronald legal team or Riley’s application for admission pro hac vice. I have never met Riley, nor
2
JONES DECLARATION
1 had any interaction with him of any nature. To the best of my knowledge he has never rendered
2 any services with respect to the action. I do not consent to his addition to the team.
3 12. Neither Stein nor Davis have ever disclosed to me that Davis is employed by Phil
4 Kramer or a Kramer law firm, that Stein and Davis worked near each other in the same office
5 building in Calabasas or that Davis renders considerable legal services for Stein.
6 13. I recently learned from prospective clients that Stein has apparently charged
7 retainers for inclusion in the case. No such change in business model was discussed with
8 me or approved by me. Assuming, however, that the model is being implemented lawfully,
9 Apex is entitled to participate in such revenue as co-counsel.

10 14. The legal team has fractured into a group that includes Apex, SML and most of
11 the clients on one side and a group that includes Stein and Davis on the other. I do not believe
12 the breaches in agreement, decorum or professional conduct are reparable. I do not see how the
13 legal team can best represent our clients in these circumstances. I therefore withdraw my
14 consent that Stein be a lead counsel in this action and further withdraw consent that Stein
15 continue to represent my clients.
16 15. I have received phone calls from clients who have expressed concern about the
17
information on the internet about Stein, as detailed in certain consumer alert blogs, and have
18
questioned whether he is acting in the best interests of the clients. This concern hampers our
19
ability to work with clients. Not having all information 'pertinent to allegations of a relationship
20
between Kramer and Stein damages our credibility and that, in turns, impairs the team's ability
21
to represent our clients.
22
16. I believe that Apex and SML can properly represent the interests of our clients
23
and can do so within the bounds of the professional standards that govern lawyers in California.
24
I declare under penalty of perjury that the forego-ing is true and correct. Executed on March
25
28, 2011, at Sacramento, California.
26
27
~~
28 Bridget Jones
3
JONES DECLARA nON
PROOF OF SERVICE
STATE OF CALIFORNIA, COUNTY OF LOS ANGELES
r am employed in the County of Los Angeles, Stace of California. I am over Lhe

age of eighteen (18) years and not a party to the within acti-on. My business address
is: 450 Nort.h Roxbury Drj.ve, Seventh Floor, Beverly Hi1ls, CA 90210.
On March 28, 2017. I served the foregoing document(s) described as: NOTICE OF
MOTTON Ai{D MOTION TO RSMOVE MIrCI{EL J. STEIN AS CO-LEA-D COITNSEL FOR PLAI}flrIFFS AND AS
COI'NSEL FOR SPECIFIED PI,AINTIFFS, TO COMPEI. STEIN TO TI'RN OVER ENGANGEMENT AGREEME}ITS
AND FOR AN ACCOUNrING;Points and Authoritiesr Declarations of Christopher Tomaszewski,
Kenin M, Spivak, Ted MaLoney, Bridget ,Jones and Exhibits on Lhese parties in this
act ion.
Mitchell J. Stej-n, Esq.

.]. STEIN & ASSOCIATES
MITCHEI,I,
2950 Buskirk Avenue, Ste, 300
walnut Creek, CA 94597
10 Erikson M. Dawis, Esq.
IJAW OFFTCES OF ERIKSON M. DAVIS
11 11574 Iowa Avenue, Suite 104
Los Angeles, CA 90025
T2
Robert E. Boone fII
t_3
Keith D. Klein
Nafiz Cekirge
BRYAN CAVE I,I,P
I4 1.20 Broadway, suite 300
Santa Monica, California 90401-2385
'tq
16 (X) (BY MAIL) I a.n rreadily faniliarn with this firm's practice of colleition and
processing correspondence by mailing. under that practice it would be
L7
deposited with U.s. postal service on that same day with postage fully prepaid
at Los Angeles, California in the ordinary cgurEe of business. I €rm aware lhat
on motion of t,he party served, service is presr:ned invalid if postal
18
cancellation date or postage meter date is more than one day after date of
deposit for rnaiLing in affidavit.
19
(BY PERSONAL DELIVERY) f caused such envelope to be deliwered by hand to the
2A offices of the addressee.
2T I caused such docu.urent to be senE via facsimile to;
(BY FACSIMILE)
NameofAttorney- ( ) -
22
(x) (vIA EMAIL) I caused such docunent to be sent via email as follows:
23 Mit,chell if. Stein, Esg, private,oceibod@gmail.com
Erickson M. Davj-s, Eaq. eri-kdavis@att. net
24 Robert E. Boone, fII, Esq. reboone@bryancave.com
Keith K1ein, Esq. keith.klein@bryancave.com
25 Nafiz Cekirge, Esq, nafiz.cekirge@bryancave.com
(x) (STATE) I declare under penalty of perjury under the laws of the State of
26
California t.hat the above is true and correct.
27
2A
Proof of Service
(FEDERAI,)I decl-are that. I am employed in the offi-ces of a member of this court
at v/hose direction the service was made.
Executed this 28th day March,20lL, in Beverly Hi1Is, Cali-f ornia
I
o
10
11
L2
13
L4
L5
l5
t1
18
19
20
2I
22
a1
24
tq
)R
27
Proof of Service

Ronald V BofA Motion 3-28-2011 Unlocked)

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Kenin M.

Spivak (SBN 97996)

B Christopher Tomaszewski (SBN 255061)

15 SUPERIOR COURT OF THE STATE OF CALIFORNIA

Case No. 8C409444

VS. NOTICE OF MOTION AND MOTION

MOTION TO REMOVE MITCHELL J. STEIN

23 (3) all discovery propounded on Defendants or received from Defendants, (4)

1t Dated: March 28,2011 SML LLp

15 Attorneys for Moving Parties

MOTION TO REMOVE MITCHELL J. STEIN

4 II. FACTS .................................................................................................................................. 2

8 III. ARGUMENT ..................................................................................................................... 8

14 CRC Rule 8.18 ................................................... 11

15 CRC Rule 8.25(a).............................................. 11

16 CRPC Rule 3-700( C )(3) ............................................ 10

17 CRPC, Rule 1-400 ................................................. 11

18 Rule 3.400 ....................................................... 9

19 Rule 3.401 ....................................................... 9

20 Rule 9.40(a) ...................................................... 8

22 Standard 2.1 ...................................................... 9

23 Standard 3.10(a) ............................................... 9, 10

25 effectively represent clients. See, e.g., CRPC, Rule 1-400.

IRS AND CONFIDENTIALITY NOTES:

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Mar 24, 2011 admin No Comments

Mitchell Stein, Esq. Files Mass Joinder Lawsuit Against

J. Stein & Associates.

http:/ / www.mjsteinassociates.com/ blog/ index.php?p= 219[ 3/ 24/ 2011 1:56:50 PM]

ABOU T M I T CH ELL J . ST EI N & ASSOCI AT ES

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"YOU HOLD THE LEASH"

http:/ / www.mjsteinassociates.com/ blog/ index.php?p= 219[ 3/ 24/ 2011 1:56:50 PM]

Mortgage Litigation Affiliate Practice

Benefits of Mortgage Litigation

Actual Lawsuit Is Filed Affordable Solution for Homeowners

Powerful Litigation Attorney Protect Your Home

STATE NAME AKA FIRM

CA *Mitchell Stein The Doberman

Mitchell Stein & Associates

(Click on Defendant Company to view case detail)

Defendant Company Defendant Company

Bank of America Citibank Corporation

Mitchell J. Stein & Associates Kramer & Kaslow

Defendant Company Defendant Company

GMAC Mortage Wells Fargo Bank, NA

Mitchell J. Stein & Associates Kramer & Kaslow

Defendant Company Defendant Company

JP Morgan Chase Bank One West Bank Group LLC

HSBC Mortgage Corp.

Cuneo, Gilbert & LaDuca, LLP Frydman, LLC

Defendant Company Defendant Company

CitiGroup, Inc. & CitiMortgage Goldman Sachs, Hudson

Susan Chana Lask E. Craig Smay, Esq. & John

Law Offices of Heather Boone Forizs & Dogali, P.A.

Lanza & Smith, PLC The Ferraro Firm

Defendant Company Defendant Company

BAC home loans servicing,

Friscia & Associates Lieff Cabraser Heimann & Bernstein