This now infamous lawsuit was filed on January 30, 1998 in County Court at Law #2, Dallas County, Texas, presided over by the Honorable Carlos Lopez. Relief was sought against Robert Goldstein, his professional corporation and his wife, in the form of an injunction to prevent the abscontion of assets and monetary relief for legal malpractice. The amount of the monetary relief sought exceeded $100,000,000.00, well within the jurisdiction for the county court. See V.A.T.S., Gov't. Code § 25.0592. (1997). The temporary injunction was denied because of a complete absence of abscontion evidence, but as an apparent accommodation to Ms. Ginsburg the case was set for trial in mid-May, 1998. The court imposed various pretrial deadlines in a Pre-trial Order. Documents later filed asserted that Goldstein's counsel never received a copy of this Order. Goldstein was represented by my brother, William Ravkind, and another experienced Dallas lawyer named Steve Malouf. Ms. Ginsburg was represented by Larry Freidman and Chris Weil.
I became involved in this case on about April 20, 1998, after Mr. Malouf decided to withdraw. My initial examination of the pleading and discovery revealed that Ms. Ginsburg was asserting that Mr. Goldstein failed to properly represent her in her divorce from Scot Ginsburg and had illegally charged her a fee in excess of $4.5 million dollars. The Plaintiff's petition read like a Henry Miller novel or a disturbed dream, depending upon your perspective. It asserted that Goldstein was a drug user, a womanizer, and a convicted felon. It was also alleged that Goldstein graduated at the bottom of his law class, abused clients and was otherwise incompetent to handle a complex divorce. My impression of Mr. Goldstein was a bit different. He was, and still is as far as I know, a reasonably effective, combative and argumentative lawyer typical to Dallas, Texas. He was, and may no longer be, more sensitive than most people believed. His practice had included some complex litigation in addition to the mundane case load of a general practitioner. At all events, Ms. Ginsburg asked for the return of the attorney's fees and damages equal to the amount she should have recovered in the divorce ($30 million dollars in excess of the $40 million dollars she actually received), and damages for loss of custody of her two children and her home in Dallas.As of April 20, 1998, deposition testimony had revealed that Ms. Ginsburg had an attention deficit disorder, had had a number of extra marital affairs during her marriage to Scot, and had testified at the court hearing for the divorce that she believed Scot should have the domiciliary custody of the children and that she wanted to accept the property settlement of $40 million dollars because she did not want to put the children through a drawn out trial. She had executed formal documents stating that the attorney's fees she owed Mr. Goldstein were $300,000 and that no other sums, contingent or otherwise, were owed. Documents also revealed that Ms. Ginsburg had attempted to settle directly with Scot for $20 million, about two and one-half (2 =) months after retaining Mr. Goldstein. That retainer, by the way, was a written contract calling for an hourly fee.
Finally, the documentary evidence revealed that thirty-two (32) days after the divorce, Ms. Ginsburg transferred 100,000 shares of Chancellor Media stock to Mr. Goldstein, which Mr. Goldstein promptly sold for $4.7 million dollars. On his books, Mr. Goldstein recorded a $300,000 fee for his law firm. The balance was reflected as a gift to him and his wife, although his accountant conceded that income tax would likely be owed on the gift because it was related to services.
While there were a number of side issues, like Mr. Goldstein's handling of an IOLTA account, his having bounced a number of checks, and his affair with the "Nanny", these did not appear to constitute a financial threat. So, you say to yourself: "This case is a lock," although a jury might find that the fee, bonus or gift Mr. Goldstein received after the divorce was excessive, and that a portion of it should be restored to Ms. Ginsburg. Well, think again.
My first action as counsel for Mr. Goldstein was to file a motion to strike the opinions of Ms. Ginsburg's designated experts on the grounds that her interrogatory answers had not been amended to provide the opinions and mental impressions of these experts, and we were less than thirty (30) days to trial. Some warning light should have gone off when Judge Lopez, without a showing of any cause, denied the Motion. But I attributed the ruling to the inadequacy of my argument, as I am inclined to do when a court rules contrary to seemingly clear precedent.
Next, Ms. Ginsburg sought to depose our designated legal expert. When it came to light that our legal expert had not been consulted or retained, did not have time to prepare, and had actually been approached by Mr. Goldstein for legal advise after he was sued by Ms. Ginsburg, we withdrew him as a designated expert which, of course, left us with none. Pretty bad, huh. Well, it gets worse. Ms. Ginsburg's lawyers then sought a discovery deposition of this expert, which the Court ordered over our opposition. Let me repeat what I said earlier. Some warning light should have gone off in my head, but theoretically almost anything might lead to discoverable information, so I felt no alarm. The deposition was taken in the Courtroom before Judge Lopez. Various non-attorney client facts were elicited and various opinions were expressed by the expert in response to hypothetical questions. All above board if one believes in reasonably unlimited discovery. But the next thing that happened was Ms. Ginsburg filed a Motion to Late Designate this expert as her own. While we opposed the Motion and issued a notice for the expert's deposition in the unlikely event the Court were to grant the Late Designation (we were about 10 days before trial), I finally began to think something amiss when the Court granted Ms. Ginsburg's Motion and denied us an opportunity to depose him.
In the meantime, I deposed Ms. Ginsburg's designated experts without benefit of any interrogatory responses identifying opinions or mental impressions. "Ike" Vanden Eykle testified at deposition that he had examined Mr. Goldstein's file and found his activity insufficient in terms of discovery. He also testified that he thought a fee of $4.7 Million dollars was excessive by about $4.5 Million dollars, based upon the amount of time Mr. Goldstein spent on the file as reflected by documents in the file. There were virtually no time or billing records in the file. He also testified that contingent fee contracts were unjustified in divorce litigation and in effect prohibited by the ethical rules, that a mother usually gets custody of the children and that a wife usually gets at least half of the community estate. Plaintiff's other legal expert testified to the same effect although less dramatically. Plaintiff's medical expert, a forensic psychologist, testified that his testing of Ms. Ginsburg revealed that she could read at a fourth grade level and do math at a third grade level. He refused to provide copies of his "tests" claiming a statutory prohibition.
Jury selection began in the case on a rather disharmonious note. Plaintiff sought to disqualify our jury consultant on the ground that her husband had acted as Plaintiff's lawyer by participating in a "lawyer jam" or think-tank session at which the case was discussed. While our consultant reported that her husband remembered no such "session", the Court, with ever increasing attention to detail, conductedahearing and directed that we produce the husband, who was in New York, to provide testimony on the subject. Moving right along we brought in a different jury consultant, and a jury was selected. About this same time, although all discovery and motion deadlines were passed, the Court granted a discovery motion directing that Mr. Goldstein provide a current financial statement. At this point the Court had overruled our Moiell Motion on the ground that it was not timely. We then spent the better part of 50 hours after court in an effort to satisfy this Order. Incidentally, the Court reversed this Moiell ruling during the course of trial when we sought to show Ms. Ginsburg's current net worth - Mr. Goldstein had a punitive damage claim against Ms. Ginsburg for the unjustified seizure of his assets.
Plaintiff's presentation of her evidence was uneventful except for interruptions in testimony on direct because the witness couldn't continue or was unavailable for one reason or another. At the close of Plaintiff's evidence, the Court granted our Motion for Summary Judgment on Plaintiff's RICO claims.
Our defense was labored because of two events. First, when we put a witness on by deposition, the Court permitted the defendant to call the witness live for cross-examination. Relatively short deposition testimony turned into days of live cross-examination. Second, although Judge Lopez had apparently agreed with a federal judge that my brother could attend a trial in Waco, Judge Lopez did not permit the absence of my brother and his trial assistant to delay Ms. Ginsburg's trial. Thus, I was directed to put Mr. Goldstein on as a witness and conduct the direct examination. While I like to think I didn't botch the job, the fact remains that I was unfamiliar with the content and physical location of many of the important documents. My brother's trial in Waco concluded to permit him to defend the cross-examination. Evidence of a probated, criminal conviction; suspensions and investigations by the state Bar; bounced checks, Goldstein's directing the Nanny to write a hot check; and his facilitating financing of a $40,000.00 car for the Nanny whose salary (about $1,000.00 per month, if I recall correctly) didn't seem to justify the extension of credit, went to the jury in cross-examination.
In her rebuttal case, Ms. Ginsburg put on evidence that Goldstein said on a number of occasions he was getting a contingent fee in the divorce. She put on her stock broker who testified that Ms. Ginsburg in May 1997 stated to him in person that she was paying Goldstein a contingent fee. Keep in mind that Ms. Ginsburg had testified that the first mention to her of a contingency was on the way to the airport on her way to France the last week in May. I guess it goes without saying that the stockbroker wasn't in the car, at the airport, on the airplane or in France. Interestingly, Ms. Ginsburg put on her estate planning lawyer who testified that Ms. Ginsburg told him in August 1997, shortly before the divorce, that Goldstein had sick children and wanted a contingency because of the exceptional job he had done in obtaining the terms of the property settlement agreement in late July 1997.
Well, now everybody rests and its time for the charge conference. Attached is the final charge, prepared by Chris Weil. He included verbatim numerous portions of the Rules of Professional Conduct. We objected, of course, because the Rules state: "[V]iolation of a rule does not give rise to a private cause of action nor does it create any presumption that a legal duty to a client has been breached." Preamble, Rules of Professional Conduct, Paragraph 15. For all practical purposes, we were excluded from the preparation process because we had not filed with the court before jury selection a proposed charge required by a pre-trial order we did not see until it was to late to comply. The jury responses leave little doubt about its appreciation of Mr. Goldstein's work.
After closing, I went home to Montgomery, Texas. Before leaving and in response to an inquiry I stated that a hearing on punitive damages would likely be irrelevant because if the jury found gross negligence or willful conduct, the amount of the actual damage awarded would be very large and the largest punitive damage award I was aware of represented 75% of the net worth of the defendant, which in Mr. Goldstein's case would have been about $4 Million. This story ends with the jury finding actual damages of $30 Million and Judge Lopez awarding punitive damages of $60 Million.
Sour grapes. You bet. A final post script. The case has settled. While the amount is confidential, various machinations in the Bankruptcy Court reflect a settlement of about $2.5 Million. There is nothing implausible about such a result, but getting there was quite an adventure.