Mr. Robert Sticht was actually recommended by a friend who had successfully used Mr. Sticht to negotiate a contract. He told me that even though Mr. Sticht took a sizable portion of the negotiated amount, but he was still satisfied as, without his negotiations, he would not have made any of the money.
So, here I was, on a rebound from an encounter with a completely incompetent lawyer whom I had fired because he played right into the hand of the adversary, when I met my new attorney, Mr. Robert Patrick Sticht, Esquire.
Had it not been for the recommendation I would have probably turned around. It was a bit strange that Mr. Sticht met with me for our first meeting in a coffee shop. He was a well dressed man of small stature but confident demeanor.
Initially I thought that the fact he met me in a coffee shop, instead of showing off his office, the fact that did not have an office at all, and the fact that his mailing address was mailbox was actually the smart way to do business, and I thought that I would get a more frugal lawyer, and one who was aware of privacy issues and protected his own very nicely.
Did not think at that time that the reason for all this was that he might actually have to hide something.
Let me give you first all the information that I have about him. It is a few years old so it might not be correct any more. But for anybody who might want to track him down it can be a start.
Mobile Phone: (310) 890-1062
Work Phone: (310) 889-1950
Work Fax: (310) 889-1864
The following address might look like a real address but is a private mailbox place:
149 S. Barrington #248
Los Angeles, California 90049
For his official address, the one, for example with the California Bar, he does not hide that it is just a post office box:
P.O. Box 49457
Los Angeles CA 90049
One thing that surprised me positively in the beginning was that he started work without being paid right away. We agreed on a retainer of ten thousand dollar, but it took me a few days to get the money together, yet he started to work on the case right away. I thought that was showing real engagement because the previous lawyer would not do anything before he had the money in his hand. His money seemed to be the most important element of the case, but Robert Sticht seemed different.
That idea was brutally crushed when I saw his first bill, though – but more about this a bit later.
All this happened in the first half of May, so as soon as Mr. Sticht had our documents and we agreed on working together, we got the engagement letters signed for all the parties involved I got the 10 k$ and wired them to to our new attorney. I also got the file from the previous lawyer and delivered it to Mr. Sticht.
At that time we had done a lot of legal research ourselves with the help of a friend who understands the law probably better than most (good) lawyers. It was clear from this research that the essential part of the claim of the plaintiff (the IRS) was time-barred. Mr., Sticht had agreed, when we engaged him, that he would be open to unconventional approaches. We needed that because in a case like ours, the mighty US government suing the little man, that little man is supposed to cave in and just try to minimize the damage. To actually win, we needed something more than collegiality of an attorney towards the government attorney in order to be beaten up as painless as possible. Thus we delivered the research we had done in form of a motion to dismiss the case to Mr. Sticht with all the quotation of law that made the case very clear.
Initially Mr. Sticht appeared to be working in a way he was supposed to: finding legal arguments that would throw out the case before it really began – simply because it was filed too late. After submitting our legal research to him and discussing it with him on the phone he wrote in an email:
As discussed by telephone, the fact that the trust acquired title before the tax lien was recorded is not in my view directly relevant to the question whether the statute of limitations on the fraudulent conveyance action was timely.
Upon further reflection, I think a better argument runs something like this. There are two statutes of limitations. See Cal Civ Code Sections 3439.09(a) and (c). Under (c), the government filed its case on 9/5/07, which is more than 7 years after the alleged fraudulent transfers were made on 9/1/98 and 12/17/99. Under (a), the filing date 9/5/07 is also more than 4 years after both transfers. In such instance, subsection (a) allows the action to be filed within 1 year after the transfer was, or reasonably could have been, discovered by the creditor. So the two questions are (1) when were the transfers actually discovered by the govt and (2) what is the earliest date when both transfers “reasonably could have been discovered” by the govt? If the transfers reasonably could have been discovered before 9/5/06, i.e., 1 year prior to the actual filing date, then the action is arguably untimely under 3439.09(a). Here, the govt admits in the complaint that it filed a notice a federal tax lien against nominees on 6/6/03. This suggests the govt actually discovered the transfers more than 4 years before it filed the action. Accordingly, the action appears untimely.
So what exception do you think the govt is relying upon to file the case outside the statute of limitations set forth in the CA UFTA?
So, it appeared he understood the law there and started adding to our own research. Initially his last remark did not disturb me too much, but looking back this must have been the beginning of Mr. Sticht realizing that if this would be so easy, he would make hardly any money. The most obvious answer would have been that the government either does not care too much what the law says, or that they just did sloppy work and missed it.
Mr. Sticht then did the unimaginable: he, more or less, sent our arguments to the opposing attorney and asked her for her position! The answer was clear – no, you are wrong and if you file a motion like this we will call that frivolous and will ask the court for sanctions against you. Here is the redacted answer he got from the assistant US attorney…
This letter alone should have raised many red flags – if the government brings the ‘frivolous’ argument that usually means that it just got caught red-handed. Instead Mr. Sticht considered this answer as proof that she was right and our research, which included to decisions of the court of appeals of our circuit deciding for the defendant in very similar cases, was wrong.
It has become pretty clear since then, that Mr. Sticht’s strategy was to get us out of his hair with our strange ideas of getting this case dismissed quickly without much work on his side and he used the opposing attorney to show us that our research was not valid. Instead of finding arguments in support of the research, he instead went into overdrive preparing the case for trial. He was much more interested in producing as many billable hours as possible – and just a few days later we got first confirmation for that. Here is an excerpt of his email…
ABCDE (our previous lawyer) did not maintain a list of discovery documents, nor a discovery file, nor provide a calendar of deadlines in his transmittal letter dated May 14. The letter contains few specifics. Accordingly, I spent extra unplanned time organizing the discovery.
I will be spending even more time analyzing, reviewing, and studying the Government’s complaint, the answer that ABCDE filed on behalf of all defendants, the Government’s discovery requests, and the first set of special interrogatories and document requests that ABCDE prepared. Any deficiencies should be caught and corrected now.
The Government has scheduled 4 days of depositions. Additional time will have to be allowed for preparing the four defendants.
I will be talking to AUSA Ford about the statute of limitations issue. If appropriate, I will file a motion to dismiss the fraud count.
I am also planning on scanning and emailing to you a full set of the Government’s interrogatories and document requests. I need your assistance in preparing responses.
In the meantime, you should be assembling for me copies of the documents that I have requested in order to reconstruct the purchase, mortgage payments, debts between the parties, etc.
You should also prepare now to send me additional funds for this case.
So, in just a few days Mr. Sticht had used up 10 kilo dollars!
In our initial talk he had mentioned a maximum cost of $50,000 as cost for the defense of the case as a very remote possibility. At $10,000 after a few days without anything really happening these $50,000 suddenly did not seem so remote any longer. Obviously we wanted to know now how these $10,000 had been spend and I requested an invoice.
It look a long time until we finally got to see how our money had been spent, two month to be precise. The previous lawyer had just been incompetent but very open with the fees he charged us. We had very promptly received monthly bills even though no payment was required. As soon as we saw Mr. Sticht’s bill it was immediately clear why he had withheld sending us a bill so long. He had, as quickly as he could, raked up as many billable hours as possible, thus defrauding us. Had he sent an invoice for the first month right away we would have stopped him much quicker and he would not have been able to extract all this money.
We also were used from the previous lawyer that administrative work was billed at a much lower rate for an assistant or para-legal. But as Mr. Sticht did not have any staff he charged us any administrative work he had done himself at his full ‘professional’ rate. Suddenly it made a lot of sense that he did not have a secretary. On reading Robert Sticht’s invoice I wondered why he had not billed us for writing this invoice.
Receiving this over-blown invoice, together with an email a bit earlier titled LAST WORD, in which he clearly stated that he would not file our motion that would have ended the case and saved us huge expenses, I actually went back to snail mail to send Mr. Sticht a clarification regarding our roles.
Very interesting the (redacted) answer to this letter:
Gggggg and Hhhhhh:
I have in hand Gggggg’s July 9 letter (copy attached). Here’s my reply.
1. You stress that you and Hhhhhh, because you are “the bosses”, do not work for me. You fail to mention that you have a duty to cooperate with me in my representation of you. It’s important that you understand that fulfilling your duty to cooperate with my representation of you does not mean you work for me.
2. You’ve asked whether “the last decision what is to be done lies with us, correct?” Correct. Here, let me clarify that the subject line “Final Word” meant “My Final Word” not “I Have The Final Word.” If this is causing you concern, then I’m glad for the opportunity to clarify.
3. You accused me of refusing to file a motion for summary judgment that was prepared by a research friend who is not a lawyer, stalling, and going into “an intensely expensive work of drafting the answer to the government’s discovery.” As a reminder, you are required to comply with the rules of civil procedure regarding discovery. If you had not complied, you would have invited the government to file a motion to compel you to comply and order you to pay sanctions. Thus, noncompliance would have been twice the work, more than twice the expense, and ultimately unproductive. (It would have been more than twice the expense because you would have to pay for responding to the motion to compel and to the discovery demands plus pay the government’s fees for seeking an order to make you comply.) The actual expense of complying was very reasonable. Count yourselves fortunate that you are not so experienced as to be the best judge of what’s reasonable. And more than simply comply, the work advanced your cause, helped us prepare for your depositions, and achieved other benefits, such as reviewing, organizing, and marking voluminous exhibits.
4. I did refuse to file the motion for summary judgment prepared by your nonlawyer friend. I did so on good authority. Here the United States is acting in its sovereign capacity. That’s a major obstacle. You haven’t shown me a way around that obstacle. I agreed to review the draft motion, review the cases cited therein, and update you with my findings. But not at the expense of your noncompliance with your discovery obligations on the ownership issue. I advised you that that you could avoid your discovery obligations by conceding the ownership issue and pursuing the procedural limitations issue as your sole defense. I also advised you that course of action would save you money. You did not instruct me to concede the ownership issue.
5. I did not request courtesy copies of the cases cited in your friend’s motion for summary judgment in order to stall filing the motion. I did so to avoid charging you for researching those cases, which presumably you already have at your disposal.
6. Similarly, I tasked your friend to do some research to cut costs and advance the case, not to send you on a “goose chase” as you accuse me of doing. For example, it is not a “goose chase” to research whether an oral trust with respect to real property, which is evidenced by deeds, trust assignments, and other writings, is enforceable under the circumstances of this case. Nor is it a “goose chase” to examine other possible legal theories that may exist to fill (possible) gaps in your evidence. And it was you who suggested in one of your emails that I could do research on the fast and cheap, not me.
7. You state that the “work performed to answer the discovery was totally unnecessary had the brief been filed.” You’re entitled to your opinion. Your opinion disagrees with mine. I stand by my advice. Your motion would not halt the proceedings as you suggest. In paragraph 2 near the end of your letter, you state that this advice “has been found to be false.” Your letter does not state how you found it to be false. Without offering me more than your bald accusation that my advice was false, I’m unwilling to change my opinion.
8. You accuse me of being intimidated by Ford’s opinion that a statute of limitations argument in this case would be frivolous. To the contrary, I have offered to review and consider your friend’s legal memorandum. If I find there is any merit to it, I will not hesitate to help you put it into a form which is suitable for my signature. As I have said before, Ford’s input is educating, not intimidating, because it signals where she stands on the issue today.
9. You “demand again that you file our motion for summary judgment, as we have presented it to you … by latest Tuesday July 15, 2008.” For all the reasons previously stated, I am unable to comply with this demand. Look at it this way. Under Fed. R. Civ. P. 11(b) (copy attached), the act of signing a motion certifies to the court that to the best of the attorney’s knowledge, information, and belief, formed after a reasonable inquiry under the circumstances, the legal contentions are warranted by existing law or by a nonfrivolous argument for extending, modifying, or reversing existing law, or for establishing new law. If the court determines this rule has been violated, it may sanction the attorney and/or party responsible for the violation. Knowing this rule, it should give you pause and cause for concern that I am unwilling to sign your friend’s motion “as we have presented it to you.” Perhaps, I’m correct that as it stands now, the legal contentions are not warranted by law. At the same time, it should offer you great relief that I am even willing to review and consider the motion from the standpoint of whether the arguments therein can be turned into legal contentions that are warranted by existing law or by nonfrivolous arguments for extending or establishing new law. You and Hhhhh are “the bosses” who “make the last decision what is to be done.” But you do not have a right to demand that I lend my signature to motions that I might not otherwise sign, simply because they make sense to you the bosses.
10. With all due respect to you, Ggggg, your paragraph 1 at the end of your letter is petty nonsense. Your paragraph 2 at the end of the letter has already been answered above. I stand behind my invoice because it’s accurate and fair.
Of course, we’ve covered these subjects in great detail in previous communications, so you may wish to re-read them in light of this exchange.
The pressure of the expense of this case is understandable. I had hoped to prepare you for such pressure when I advised you at the outset to plan on spending upwards of $50k even before I saw the file. I don’t mind your ventilating such pressure. The expense, however, is not due to anything I’ve done. It’s for your legal defense of what’s been done by you in the past. You did not involve me then. It’s unreasonable to burden me now. I’m here to defend you the best way I know how. You’re aiming at the wrong target.
Your conclusion states that you hope continued work on this case is still possible. I’m deeply disappointed that you do not recognize anywhere in your letter the value of my work, or having my qualifications on your team, or the personal attention and service that you’ve received from me. You now know my position on the two issues raised in your letter. Let me know how you wish to proceed.
Robert Patrick Sticht
He is, I have to concede, a pretty slick lawyer, but under a bit of scrutiny it is clearly visible that this is an attempt to whitewash the simple fact of refusal to file a motion that would have ended the case with expenses of a few hundred dollars. For example a motion to dismiss would have held discovery and siding with the opposing council and agreeing that a decision of the Appeals Court is ‘frivolous’ so that many billable hours can be charged is clearly fraudulent.
I wonder why it would be important that this friend who did the legal research is not a lawyer – if not an attempt to ‘divide and conquer.’