Certified Forensic Loan Auditors, LLC

 
  Upcoming Classes

Search CFLA's Article Archive:

Cohen Milstein Role Under Fire in Robo-Signing Case

americanlawyer.comJune 4, 2013

By Amanda Bronstad

The Nevada Supreme Court is expected to take up arguments in a high-profile robo-signing case in which a mortgage processing services firm is challenging the legal authority of the state's attorney general to hire Cohen Milstein Sellers & Toll on a contingent fee basis.

Lender Processing Services Inc. has petitioned the state's high court to overturn a ruling that allowed Cohen Milstein's Betsy Miller to be associated as counsel to Nevada Attorney General Catherine Cortez Masto. Masto has a pending complaint alleging that Lender's robo-signing of mortgage documents contributed to the state's economic recession.

In its brief, Lender argues that the attorney general's office violated a state law in hiring Cohen Milstein on a contingent fee basis and that, by granting the outside firm considerable authority in the case, has held the company hostage in settlement negotiations. Masto's office has insisted that its actions were legal.

The Nevada Supreme Court has scheduled oral arguments for Wednesday.

The U.S. Chamber of Commerce and the American Tort Reform Association, longtime critics of contingent fee arrangements between private attorneys and government agencies, have filed an amicus brief.

"The contingency fee arrangement not only runs afoul of Nevada law, but represents a troubling example of a state ceding control of litigation on behalf of its citizens to private plaintiffs' lawyers whose interests are driven by financial gain rather than the public welfare," said Lisa Rickard, president of the Chamber's Institute for Legal Reform, in a prepared statement sent by email to The National Law Journal.

Jennifer López, a spokeswoman for the Nevada attorney general's office, declined to comment. Mark Connot, a partner at Fox Rothschild in Las Vegas who represents Lender, which is based in Jacksonville, Fla., declined to comment.

Miller, of Washington's Cohen Milstein, did not return a call for comment.

Masto filed her complaint against Lender Processing Services in 2011. On June 27, 2012, the company objected to the attorney general's motion to associate Cohen Milstein — and Miller, specifically — into the case. Clark County, Nev., District Judge Elizabeth Gonzalez granted that motion on July 19. Lender filed a writ of mandamus to overturn that ruling on July 31.

At the heart of the debate is Nevada statute 228.110, which reads: "No officer, commissioner or appointee of the Executive Department of the Government of the State of Nevada shall employ any attorney at law or counsel at law to represent the State of Nevada within the State, or to be compensated by state funds, directly or indirectly, as an attorney acting within the State for the State of Nevada or any agency in the Executive Department thereof unless the Attorney General and the deputies of the Attorney General are disqualified to act in such manner or unless an act of the Legislature specifically authorizes the employment of the other attorneys or counselors at law."

Neither exception, Connot wrote, applies in this case.

On January 31, Lender agreed to settlements with the other 49 states totaling more than $127 million. "Cohen Milstein has been given virtual veto power over any settlement offer, making a settlement similar to those already achieved with 49 other State Attorneys General and the District of Columbia impossible," the Chamber's Rickard said.

Moreover, under the contract with Cohen Milstein, the attorney general's office has agreed not to settle for injunctive relief unless the defendant provides costs and hourly fees for the law firm's services, wrote Joseph Brown, a director at Fennemore Craig in Las Vegas who represents the Chamber and the American Tort Reform Association.

He went one step further, arguing that contingent fee contracts with outside counsel by government attorneys were inherently unethical and violate a defendant's due process rights.

"Delegation of enforcement of state law to private lawyers with a profit interest in the litigation is contrary to legal and government ethics, constitutional law, and sound public policy," wrote. Such agreements have led to "exorbitant fee awards" and "millions of dollars to private lawyers," he wrote.

Frankie Sue Del Papa, who was Nevada's attorney general from 1991 to 2002, wrote in an October 1 amicus brief that the high court should be suspicious about Lender' brief, given that corporate defendants have unsuccessfully raised similar arguments in the past.

In a September 10 answering brief, Nevada Solicitor General Wayne Howle wrote that the Nevada Constitution and common law permit the attorney general's office to hire outside law firms on a contingent basis. Nevada statute 228.110, he wrote, was designed to preserve the office's ability to hire outside counsel but limit that of other executive agencies to do the same.

Furthermore, lawyers in the attorney general's office have directed the litigation, with Masto personally conducting at least three settlement discussions without Cohen Milstein, he wrote.

"LPS's only purpose in filing this Petition is to gain a tactical advantage in the State's case — by diverting resources from the State's prosecution now and ensuring that the State cannot match its resources in the future," Howle wrote.

The contingent fee issue isn't the first challenge to the Nevada attorney general's pursuit over lending practices at Lender. On February 25, Clark County, Nev., District Judge Carolyn Ellsworth threw out more than 300 counts of a criminal indictment against two of its former executives, Gary Trafford and Gerri Sheppard, after finding that the attorney general's office had committed prosecutorial misconduct before a Nevada grand jury. Specifically, the court found that the office's attorneys had given jurors an improper definition of what constituted a forgery and threatened a witness into pleading guilty.

Back to June 2013 Archive

CFLA was founded by the Nation's Leading Foreclosure Defense Attorneys back in 2007 to serve the Foreclosure Defense Industry and fight pervasive Bank Fraud. Since opening our virtual doors, CFLA has rapidly expanded to become the premier online legal destination for small businesses and consumers. But as the company continues to grow, we're careful to hold true to our original vision. For us, putting the law within reach of millions of people is more than just a novel idea—it's the founding principle, just ask Andrew P. Lehman, J.D.. With convenient locations in Houston and Los Angeles, you can contact Our National Account Specialist and General Manager / Member Damion W. Emholtz at 888-758-2352 for a free Mortgage Fraud Analysis or to obtain samples of work product, including cutting edge Bloomberg Securitization Audits, Litigation Support, Quiet Title Packages, and for more information about our Nationally Accredited and U.S. Department of Education Approved "Mortgage Securitization Analyst Training Certification" Classes (3 days) 24 hours for approved CLE & MCLE Credit (Now Available Online).

SEE BELOW- http://www.certifiedforensicloanauditors.com

Call us toll free at 888-758-2352

Bookmark and Share
spacer
Facebook Like us on Facebook
Twitter Follow us on Twitter
YouTube View our YouTube Videos
LinkedIn Connect to us on Linkedin
 
BBB Logo

 

spacer
Contact us or view our Sample Documents & Audits by completing the form below.

  • Reload
  • Should be Empty:




 

DVD Sets Only $99

 

FREE Mortgage Fraud Analysis

 

Order Cutting-Edge Services Now

 

Quiet Title Packages from Licensed Attorneys

 

Affiliate Services

 

CFLA Sponsored Attorney Links

 

Take-Home Education Package

 

ALB Law Firm

 

Advocate Legal

 

The True News Network

 

Rubenstein Business Law

 

Atighechi Law Group

 

Scunziano & Associates

 

Get Certified to Perform Mortgage Securitization Audits

 

CFLA Training Academy

 

Expert Witness Services

 

Cutting Edge Expert Securitization Reports

 

CFLA Credit Cards

 

Breaking News

 

Letters to the Editor

 

CFLA Weekly Newsletters

 

Code of Ethics

 

Testimonials

 

Instructional Videos

 

Job Opportunities

 

License Opportunities

 

MARS Rule

 

Product Samples

 

Resource Links

 

Servicer Information

 

Foreclosure Laws

 

REST Report

 

Quiet Title Packages from Licensed Attorneys

 

Advertise on CFLA

 

Advertising Space: Mortgage Securitization, Quiet Title

 

Certified Forensic Loan Auditors, LLC
13101 West Washington Blvd.
Suite 444
Los Angeles, CA 90066

Toll Free: 888-758-CFLA (2352)
Mobile Users: CLICK TO CALL
info@certifiedforensicloanauditors.com

   
 
CFLA IS NOT A LAW FIRM AND DOES NOT PROVIDE ANY LEGAL ADVICE. CFLA DOES NOT OFFER FORECLOSURE CONSULTING OR FORECLOSURE RELIEF
SERVICES. CFLA DOES NOT OFFER OR ASSIST WITH ANY LOAN MODIFICATION SERVICE. CFLA ALWAYS RECOMMENDS THAT CLIENTS RETAIN COMPETENT COUNSEL IN THEIR RESPECTIVE JURISDICTION. CFLA HAS A FREE PROGRAM TO REFER CFLA CLIENTS TO LAW FIRMS IN NEARLY EVERY STATE AND CFLA
DOES NOT CHARGE OR OBTAIN REFERRALS FEES FOR THESE SERVICES. SERVICES NOT OFFERED TO RESIDENTS OF THE STATE OF NEVADA.

 
Home About Us Privacy Policy Terms of Service Disclaimer SERVICES Careers Contact Us
 
COPYRIGHT © 2007-2016 Certified Forensic Loan Auditors ™ All rights reserved