Finding Plaintiffs Lawyers Committed Fraud, Judge Dismisses Tort Cases Against Dole and Dow Chemical

Judge Finds Plaintiffs Lawyers in Dole Case Committed Fraud

Ben Hallman

The American Lawyer

It's not that we're jaded, exactly, but it takes more than run-of-the-mill allegations of attorney misconduct to impress us. So when we say that a hearing that took place on Thursday in Los Angeles Superior Court addressed the most egregious plaintiffs lawyer extortion and fraud allegations we've seen this side of criminal indictment, we're not being hyperbolic. And if that description isn't enough to make you click on our link to the hearing transcript, consider this: Judge Victoria Chaney may also have set a record for the most extended metaphor that we've ever heard in a courtroom. We're talking fire-breathing chimeras, people.

At the hearing Thursday, Chaney dismissed from the bench two tort cases against Dole and Dow Chemical, ruling that Los Angeles plaintiffs lawyer Juan Dominguez and co-counsel in Nicaragua committed a "fraud on the court" and a "blatant extortion" of the defendants. In the hottest water is Dominguez, counsel to thousands of Nicaraguan men who won judgments against Dole Foods in Nicaraguan courts after claiming they were made sterile by the chemical DBCP, which is used on banana plantations.

After several days of testimony on defense allegations of Dominguez's misconduct, Chaney tossed the tort cases before her. "I find that there is and was a pervasive conspiracy to defraud American and Nicaraguan courts, to defraud the defendants, to extort money from not just these defendants -- but all manufacturers of DBCP and all growers or operators of plantations in Nicaragua between 1970 and 1980," she said from the bench. Her ruling puts in doubt $2 billion in pending judgments Dominguez won in dozens of similar suits. Chaney also said she would refer the matter to state bar associations and to prosecutorial agencies. (Chaney specifically exonerated the Sacramento firm of Miller, Axline & Sawyer, which is also plaintiffs counsel on the case, saying she did not suspect its lawyers of participating in the fraud scheme.) Dominguez couldn't be reached for comment.

Dole's lead lawyer, Scott Edelman of Gibson Dunn & Crutcher, told the Litigation Daily that in 25 years of practicing law, he'd never seen anything like the conduct of Dominguez and the other plaintiffs lawyers. They offered a $20,000 bounty in Nicaragua for information about witnesses, Edelman said, and saw to it that Dole investigators were subject to intimidation by police and other officials. The court testimony that led to Chaney's ruling detailed how a group of Nicaraguan lawyers, in apparent collusion with local officials, judges and lab technicians, rounded up 10,000 men whom they coached to claim sterility -- and to blame that sterility on Dole's chemicals. In fact, many of the men had never worked for Dole, and many weren't sterile. Some even had multiple children. "There [are] massive amounts of evidence demonstrating the recruiting and training of fraudulent plaintiffs to bring cases in both the Nicaraguan and U.S. courts," Chaney wrote.

Edelman told us Dole suspected for years that the plaintiffs had engaged in fraud, but that when Gibson Dunn took over the case from Jones Day last fall, he wasn't sure whether he'd be able to prove it because the Nicaraguan witnesses were so reluctant to talk. Dole's investigation has been under tight wraps for the past six months, and Chaney closed her courtroom to the public during one of the days of hearings on the defense allegations, in part to protect witnesses who testified about the plaintiffs lawyers' tactics.

Chaney certainly found the witnesses' testimony to be credible. She compared the plaintiffs' fraud scheme to a chimera, which, in case you don't know, is a fire-breathing monster with the head of a lion, the body of a goat and the tail of a snake. Here's our favorite part of the hearing transcript: "We have a chimera that is really truly heinous and repulsive, created from separate organisms cemented together by human greed and avarice. Well, you might be asking what kind of organisms have been cemented together to form this strange chimera? These organisms are really groups of people or classifications of people. It's made up of groups of attorneys who actually designed this creature, which is the neural system, the brain of this creature." We're not exactly sure if the metaphor makes complete sense, but her outrage comes through loud and clear.

Next up in Chaney's court is a May 8 contempt hearing. The judge has also promised to produce a "much longer written ruling" that cites the volumes of evidence that emerged at the hearing. We're looking forward to reading it.

This article first appeared on The Am Law Litigation Daily blog on AmericanLawyer.com.