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Wednesday, Sept. 7, 2011

State of Ohio v. Dennis Gould, Case no. 2010-1315
6th District Court of Appeals (Lucas County)

The American Chemical Society v. Leadscope, Inc., et al., Case no. 2010-1335
10th District Court of Appeals (Franklin County)

Disciplinary Counsel v. William Lawrence Summers, Case no. 2011-0464
Cuyahoga County

Akron Bar Association v. Betty Groner, Case no. 2011-0866
Summit County

Disciplinary Counsel v. Michael Troy Watson, Case no. 2005-0398

Cleveland Metropolitan Bar Association v. Frank X. Gresley, Case no. 2010-1460


Did Appeals Court Err In Applying Exclusionary Rule to Bar Evidence Obtained Through Warrantless Search of Hard Drive?

Where Police Believed Hard Drive Had Been ‘Abandoned’ by Owner

State of Ohio v. Dennis Gould, Case no. 2010-1315
6th District Court of Appeals (Lucas County)

ISSUE: When a computer hard drive is taken to police by a member of the owner’s family contrary to the owner’s instructions  not to allow anyone else to touch it, and the family member tells officers she suspects but does not know that the drive may contain evidence of illegal acts, if the police conduct a warrantless search of the hard drive without the owner’s consent based on their assumption that it is “abandoned” property, does that search violate the owner’s Fourth Amendment right against unreasonable searches, and require a court later hearing criminal charges against the owner to suppress evidence obtained through the search under the exclusionary rule?

BACKGROUND: Dennis Gould of Toledo was charged with rape of a child under the age of 13, gross sexual imposition, and illegal use of a minor in nudity-oriented material. The charges were  based on pornographic images retrieved from a detached computer hard drive Gould left along with other possessions in an apartment he shared with his brother prior to leaving the city without indicating his destination or plans to return.

The images were discovered by police when they performed a warrantless search of the hard drive after it was brought to them by Gould’s mother, Sharon Easterwood. Easterwood told police detective Gina Lester that she suspected but had no direct knowledge that the hard drive contained child pornography.  Easterwood told Lester that Gould had left the hard drive at her house nine months earlier with instructions that “no one else was to touch it,” and had recently left the city without taking the hard drive or other possessions and had not been heard from for several weeks. 

Detective Lester checked the hard drive into the police property room, but did not have it searched for several months. After a follow-up conversation in which Easterwood gave Lester a new cell phone number she believed to be her son’s, Lester made several calls to the number and left a voice message but received no response from Gould. Lester subsequently asked Easterwood whether she believed her son had abandoned the hard drive. When Easterwood said she did, Lester had Easterwood sign a consent form allowing police to search the contents of the hard drive. Gould was subsequently located, arrested, and indicted on multiple felony counts based solely on the contents of the hard drive.

During pretrial proceedings, Gould’s attorneys filed a motion to suppress all evidence obtained through the warrantless search of his hard drive on the basis that the search violated Gould’s Fourth Amendment protection against unreasonable searches and seizures. At a hearing on the motion to suppress, Easterwood gave a different account of her possession of the hard drive.  She testified that Gould had reassumed possession of the hard drive when he moved to his own apartment several months before his disappearance, and that shortly after Gould left Toledo Easterwood had his brother’s girlfriend take the hard drive from a closet in Gould’s apartment, where his brother continued to live, and bring it to Easterwood who took it to the police. 

Lester testified that in determining that the hard drive was abandoned property that police could search without a warrant or Gould’s consent, she had relied on Easterwood’s representation that Gould had left the hard drive at his mother’s home for approximately nine months and then left the city without making any attempt to retrieve it. The trial court denied the motion to suppress the results of the search, holding that the hard drive was abandoned property and therefore the police search was permissible and the exclusionary rule requiring suppression of evidence obtained through an unconstitutional search did not apply.

The contents of the hard drive were introduced at trial, where Gould was found guilty by a jury on all counts.  He was sentenced to life in prison on the rape charges and received additional prison terms  for his other convictions.

Gould appealed the denial of his motion to suppress. On review, the 6th District Court of Appeals reversed the trial court and vacated Gould’s convictions based on its conclusion that the trial court had acted without credible or competent evidence in finding that the hard drive had been abandoned. In its opinion, the court of appeals said the trial court had erred in disregarding Easterwood’s hearing testimony that Gould had retrieved the hard drive from her home and maintained possession of it in his own apartment, where his brother continued to live, for several months until Easterwood took it without Gould’s permission or consent and gave it to the police.

The state, represented by the Lucas County prosecutor’s office, sought and was granted Supreme Court review of the 6th District’s decision.

Attorneys for the state argue that in its 2009 decision in Herring v. United States, the U.S. Supreme Court held that the exclusionary rule may be invoked to suppress evidence only in cases where police obtained that evidence by engaging in “deliberate, reckless or grossly negligent conduct” or through “recurring or systemic negligence.” They cite earlier Supreme Court decisions which have held that the purpose of the exclusionary rule is to deter police from intentionally violating constitutional safeguards in conducting search and seizure activities.

They assert that in this case Detective Lester based her determination that Gould had abandoned the hard drive on his mother’s representation that he had left it in her possession for over nine months and had made no effort to retrieve it before disappearing without any indication that he planned to return.
If there was misconduct that resulted in an improper search, they contend, it was not committed by police but by Easterwood.

Attorneys for Gould point out that the Herring decision did not analyze a warrantless search like the one performed in this case, but rather held that evidence need not be suppressed when it was obtained  by police who were executing an apparently valid warrant that was later found to have been cancelled. They argue that in Herring the Supreme Court did not announce any dramatic new interpretation of the exclusionary rule, but merely reinforced earlier decisions holding that when an inadvertent error is made by police or court officials who are not directly involved in a search, invoking the exclusionary rule to suppress evidence obtained in the resulting search does not serve the purpose of the rule, which is to deter deliberate actions by the police that are contrary to law.

In this case, they argue, the police misconduct cited by Gould as grounds to suppress evidence was not an inadvertent clerical error that resulted in an improper search, as in Herring; the misconduct was the deliberate  performance of an unconstitutional search in the absence of either a search warrant or the consent of the property owner.

Contacts
Evy M. Jarrett, 419.213.2001, for the state and Lucas County prosecutor’s office.

Jeremy J. Masters, 614.466.5394, for Dennis Gould.

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Can Jury Award Damages for 'Malicious Litigation' Without Court Finding That Plaintiff's Suit Was Objectively Baseless?

May Liability be Imposed Based on Jury’s Finding of ‘Malicious Intent’ for Suit

The American Chemical Society v. Leadscope, Inc., et al., Case no. 2010-1335
10th District Court of Appeals (Franklin County)

ISSUE:  May a plaintiff who brings a civil suit against a defendant be found liable for damages for “malicious litigation” based on a jury’s finding that the plaintiff’s motive for filing suit was to harass or injure the defendant if there is not also a finding by the court that the plaintiff’s complaint was objectively baseless?

BACKGROUND: When Chemical Abstracts Service of Columbus, a division of the American Chemical Society (ACS), stopped work on a software project that several of its employees had been working on for some time, three of those employees retired/resigned and shortly thereafter formed a new company, Leadscope Inc. Leadscope subsequently developed and obtained a patent on a software product with similarities to the product they had worked on while employed by ACS. 

After Leadscope had obtained its patent and was in the process of obtaining sufficient venture capital to produce and market its new product, which would potentially compete with products and services offered by ACS, ACS filed suit against Leadscope and its principals alleging misappropriation of trade secrets, violation of employment agreements and other claims. Leadscope filed counterclaims alleging defamation, unfair competition, and tortious interference with contractual relations.

After a 13-day trial, the jury dismissed ACS’ claims against Leadscope and found in favor of Leadscope on its counterclaims, awarding $26.5 million in damages to which the trial court added $7.9 million in attorneys’ fees and costs. The award included damages for “malicious litigation” and for defamation based on a letter ACS had sent to its own employees describing the lawsuit, and an article that appeared in a Columbus business publication in which spokespersons for both ACS and Leadscope described the claims they were asserting against each other in the lawsuit.

ACS appealed. The 10th District Court of Appeals affirmed the trial court’s judgment and damage award.  ACS sought and was granted Supreme Court review of the 10th District’s decision.

Attorneys for ACS argue that both the trial court and 10th District disregarded past Ohio court decisions which have held that parties have a First Amendment right to petition the courts for redress of legal grievances, and that a party bringing suit may not be found liable for “malicious litigation” or wrongful interference with a defendant’s business relationships based on the filing of a lawsuit unless the court finds both that the suit was filed in bad faith, and that the plaintiff’s complaint had no basis in fact. They point out that in this case the trial court overruled both a pretrial motion for summary judgment and a motion at the close of evidence for a directed verdict in favor of Leadscope based on the court’s finding that ACS’ complaint raised material questions of fact that must be decided by the jury – thus establishing that there were reasonable grounds for ACS’ claims even though those claims were ultimately unsuccessful.  They contend that if the decisions of the trial court and 10th District in this case are affirmed, Ohio business entities who believe they have grounds to sue another party will be faced with the prospect of huge potential damage awards for “malicious litigation” if claims they assert against a defendant are ultimately rejected by a judge or jury.

ACS also asserts that the trial court and court of appeals erred by affirming the jury’s award of damages against ACS for defamation based on public statements that did no more than accurately repeat the claims set forth in the complaint they filed with the court.  They argue that Leadscope made no showing that it suffered financial losses or any other harm based on ACS’ letter to its employees or the cited newspaper article, and in the absence of harm directly related to the alleged defamatory statements, the trial court should never have submitted Leadscope’s defamation claim to the jury.  

Attorneys for Leadscope and its principals respond that in concluding that ACS was  liable for unfair competition and tortious interference with Leadscope’s business relationships, the jury was required to find that 1) ACS’ claims lacked merit; 2) ACS knew they lacked merit; and 3) the claims were brought despite their lack of merit for the purpose of harassing and causing harm to Leadscope as a potential business competitor. They assert that these findings satisfy the requirements of prior court decisions with regard to the malicious intent and objective baselessness of a plaintiff’s complaint. 

With regard to the award of damages for defamation, they contend that the jury accurately found that ACS’ public statements alleging that Leadscope’s founders had stolen trade secrets falsely accused them of criminal conduct, and intentionally raised doubts about the viability of their new business at a crucial moment when they were obtaining the necessary venture capital to bring their product to market.

NOTE:  Amicus curiae (friend of the court) briefs supporting the position of the American Chemical Society in this case have been submitted by the State of Ohio, the Ohio State Bar Association and jointly by the Ohio Chamber of Commerce, Ohio Manufacturer’s Association and Ohio Council of Retail Merchants.

Contacts
Michael G. Long, 614.464.6297, for the American Chemical Society.

Alan L. Briggs, 614.626.6702, for Leadscope Inc.

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Attorney Discipline

Disciplinary Counsel v. William Lawrence Summers, Case no. 2011-0464
Cuyahoga County

The Board of Commissioners on Grievances & Discipline has recommended that the license of Mayfield Heights attorney William L. Summers be suspended for six months and that Summers be ordered to make restitution of $15,000 to the family of a client from whom the board found he collected an excessive fee prior to withdrawing from the client’s criminal case before it came to trial.

The board found that Summers violated the state attorney discipline rules that prohibit charging an illegal or clearly excessive fee, entering into a “non-refundable” flat fee arrangement with a client without including a required notice that the client may be entitled to a refund if promised work is not completed, and engaging in conduct that reflects adversely on the attorney’s fitness to practice law.

Summers has entered objections to the board’s findings and recommended sanction.  He argues that in finding that he charged an excessive fee the board disregarded  a detailed listing of the time he spent on the client’s case that more than accounted for the $17,500 in fees he received from the client prior to withdrawing from representation. He also asserts that the absence of an Ohio-required  disclaimer in his “non-refundable” fee agreement with his client was an honest mistake arising from his use of a form that meets the requirements of Kentucky, where he is also licensed to practice. 

The Office of Disciplinary Counsel, which prosecuted the charges against Summers before the board, has responded to his objections by pointing out that the non-refundable fee agreement he drew up promised that in exchange for a $15,000 flat fee, Summers would see the client’s case through to completion without reference to any number of billable hours. Counsel also cited the board’s finding that the legal work Summers performed before abandoning his client represented only about one-third of the pretrial activities required to prepare the client’s case for trial, and the board’s conclusion that the accounting of his time Summers provided to the client and disciplinary authorities was “padded” with excessive and inappropriate charges designed to justify his keeping the entire fee without providing the promised representation.

Contacts
Jonathan E. Coughlan, 614.461.0256, for the Office of Disciplinary Counsel.

Michael L. Close, 614.221.5216, for William Summers.

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Attorney Discipline

Akron Bar Association v. Betty Groner, Case no. 2011-0866
Summit County

The Board of Commissioners on Grievances & Discipline has recommended that the license of Akron attorney Betty Groner be suspended for 12 months, with the final six months of that term stayed, for professional misconduct in representing a client who opposed the appointment of his sister as administratrix of their mother’s estate.

The board found that Groner violated multiple provisions of the Rules of Professional Conduct when she filed legal documents in the Summit County Probate Court alleging that the sister had filed for personal bankruptcy and had several criminal convictions based on a hurried and carelessly reviewed internet background check that actually showed the convictions and bankruptcy were attributable to a different person with a similar name. The board also found that Groner engaged in conduct prejudicial to the administration of justice and conduct involving deceit or misrepresentation when she attached as an exhibit in her client’s court filing a document that appeared to be a bonding agent’s denial of the sister’s application for a fiduciary bond when Groner knew that the sister had not applied for or been denied bond, and that Groner had obtained the document from a bonding agent based on information that she herself had supplied.

Groner has filed objections to the board’s findings of misconduct and recommended sanction.  She asserts that the filing of inaccurate information about the sister with the probate court was an inadvertent mistake based on her last-minute discovery of an immediate deadline for entering written pleadings in the case, which forced her to rely on the rushed and poorly reviewed internet research. She argues that as soon as she discovered that the information she had submitted was incorrect, she filed a motion seeking mediation of the case that negated the earlier, inaccurate filing.  With regard to the “bond denial”  exhibit, Groner argues that the evidence does not show that she intended to deceive the court, but merely sought to file written confirmation by a third party that a person with the credit and criminal records she believed her client’s sister to have could not serve as administratrix of an estate because she could not obtain the required fiduciary bond.

The Akron Bar Association, which prosecuted the charges against Groner before the disciplinary board, responds that before filing documents with a court as evidence, an attorney has a duty to carefully review the accuracy of information in those documents.  In this case, they argue, even a minimal review of the 16-page background check Groner got from the Internet would have revealed that the information she filed  in the probate court applied to several different persons with the same name as her client’s sister, who were of different races and physical descriptions and lived in different cities and states.

Contacts
Donald J. Malarcik Jr., 330.253.0785, for the Akron Bar Association.

Khan Rasheeda, 614. 462.5400, for Betty Groner.

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Attorneys Ordered to Appear

Disciplinary Counsel v. Michael Troy Watson, Case no. 2005-0398

Cleveland Metropolitan Bar Association v. Frank X. Gresley, Case no. 2010-1460

In addition to the oral argument cases listed above, the Court has ordered two attorneys to appear on Sept. 7 and show cause why further sanctions should not be imposed against them for failing to comply with earlier disciplinary orders of the Court.

In Case No. 2005-0398,  former Cleveland attorney Michael Troy Watson has been ordered to appear and show cause why he should not be required to serve a suspended 90-day jail sentence and pay the suspended portion of a $10,000 civil penalty that were imposed against him in 2007 for continuing to practice law after he was disbarred by the Court in December 2005. The show-cause order was issued pursuant to a motion filed by the Office of Disciplinary Counsel asserting that Watson has violated the conditions under which his jail sentence and $9,500 of his $10,000 fine were suspended by continuing to engage in the practice of law after 2007 despite the permanent revocation of his license.

In Case No. 2010-1460, the Court has ordered attorney Frank Gresley of Middleburg Heights to appear and show cause why he should not be required to serve all 24 months of the license suspension imposed against him in December 2010.  The final six months of Gresley’s two-year suspension were stayed by the Court on the conditions that he make an accounting to former clients whose cases he neglected or abandoned and return case files and unearned fees to those clients. The show-cause order was issued pursuant to a motion filed by the office of Disciplinary Counsel asserting that Gresley did not provide proof that he has complied with the conditions imposed by the Court, and did not respond to a June 6, 2011 order in which the Court ordered him to file a written response to Disciplinary Counsel’s motion.

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These informal previews are prepared by the Supreme Court's Office of Public Information to provide the news media and other interested persons with a brief overview of the legal issues and arguments advanced by the parties in upcoming cases scheduled for oral argument. The previews are not part of the case record, and are not considered by the Court during its deliberations.

Parties interested in receiving additional information are encouraged to review the case file available in the Supreme Court Clerk's Office (614.387.9530), or to contact counsel of record.