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In re Carey11/26/2002
Richard [Cooper] approached Joey [Danis] and I and asked us if we would be interested in getting involved in the case, we knew that there was no conflict of interest, and they needed help because . . . there was a motion to transfer that was pending in St. Louis City. They needed help. There wasn't time to try and go out and find another co-counsel.
Carey & Danis entered their appearance on behalf of the Beam plaintiffs. However, neither Carey nor Danis sought or received Chrysler's consent to act as plaintiffs' counsel against Chrysler.
In December 1995, Joseph and David Danis met in New York with Stanley Grossman, an attorney who had a similar ABS class action suit against Chrysler in New Jersey. At the meeting they discussed joining -- and later did join -- the two class actions as well as a third group of plaintiffs from Mississippi represented by John Deakle. Following the meeting, Joseph Danis wrote Grossman to confirm the discussion regarding the ABS cases. Danis also inquired as to allocation of attorneys' fees if the cases were consolidated, saying there was "plenty of money for all . . . . Consequently, we will all be better served working together against Chrysler . . . ." This correspondence has been termed "the Grossman letter."
While Danis and his father were in New York meeting with Grossman, Carey received a letter from Charles Newman accusing Carey & Danis of having a conflict of interest in the Beam case. Carey was "very upset" upon reading Newman's letter and immediately called Newman to tell him that he believed "in the strongest terms that [Carey & Danis] did not have a conflict of interest," but that he did not want to cause any trouble with Newman, Thompson & Mitchell, or Chrysler. Carey inquired if they could put an end to "all this ugliness and nastiness" if he and Danis withdrew from the Beam case. Newman did not make any promises, but thought that might appease Chrysler.
Thereafter, the Beam case was voluntarily dismissed and then joined with Grossman's case in New York. Carey & Danis withdrew from Beam, but the Danis, Cooper firm and John Deakle were among the attorneys listed for the plaintiffs. Carey & Danis associated with a group of class action attorneys -- David Danis and John Deakle, among others -- that often worked together on cases and shared information. A number of these attorneys were involved in Chrysler ABS litigation. Members of this group would forward correspondence regarding the ABS litigation to each other and many of these communications would find their way to Carey & Danis.
C. Chrysler v. Carey & Danis -- False and Misleading Statements
Respondents Carey and Danis notified their malpractice insurer of a potential lawsuit by Chrysler and gave the insurer copies of documents that could be relevant -- including the Grossman letter. The insurer later met with Lou Basso, the attorney Carey and Danis had chosen to represent them. The insurer gave the documents respondents had compiled to Mr. Basso. Basso made copies and then returned the documents to the insurer. Carey and Danis had also given the original Grossman letter to Basso, along with some other documents, when Basso was originally retained.
On March 26, 1996, Chrysler sued Carey & Danis for breach of fiduciary duty and respondents were served with process. Chrysler alleged that Carey & Danis, though not attorneys of record, assisted a group of lawyers in prosecuting ABS class action claims against Chrysler. Chrysler served interrogatories and requests for production upon both Carey and Danis, individually.
Between March 26, 1996 (when respondents were served) and Octob
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