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Broward County, Fla.’s largest law firm and one of its partners could face sanctions of up to $700,000 for making what a federal magistrate found to be frivolous claims in a racial discrimination lawsuit against Massachusetts-based Ocean Spray. Last month, U.S. Magistrate Barry Garber in Miami recommended sanctions against Barry Mandelkorn, a partner at Ruden McClosky Smith Schuster & Russell in Fort Lauderdale. Garber asked opposing counsel from Akerman Senterfitt to submit its attorneys’ fees in the case by Oct. 4. Sources estimate the fees to be between $500,000 and $700,000. U.S. District Judge Patricia Seitz in Miami still must rule on the sanctions. “We really don’t know the total amount at this time,” says Kevin Shaughnessy, a partner in Akerman’s Orlando, Fla., office and lead lawyer for Ocean Spray. “We haven’t formalized our petition, and the court will be final arbiter.” This is the latest in a series of sanctions recommended or ordered against plaintiffs’ lawyers in employment lawsuits. Another Akerman lawyer, Jon Stage, a partner in the Fort Lauderdale office, recently received a federal magistrate judge’s approval for $600,000 in sanctions against labor and employment attorney Karen Amlong, of Amlong & Amlong in Fort Lauderdale. U.S. District Judge Joan Lenard in Miami still must approve that amount. In July, U.S. District Judge Donald M. Middlebrooks in Miami slapped Charles Whitelock, managing partner of Whitelock & Associates of Fort Lauderdale, with a Rule 11 sanction, based on the Federal Rules of Civil Procedure, for filing a “baseless” employment discrimination and retaliation suit. Whitelock was hit with an $$8,800 penalty after Middlebrooks ruled that he ignored “objective evidence casting serious [if not fatal] doubt” on his client’s allegations. Middlebrooks later asked the defense attorney who requested the Rule 11 sanction to respond to new evidence Whitelock presented in support of his request for reconsideration of the sanctions order. “I don’t know if I’ll beat Jon Stage’s record, but I may,” quips Shaughnessy. “I rarely ever ask for sanctions. But in this case, it was abundantly clear that the plaintiffs’ lawyers didn’t do a proper investigation.” Mandelkorn did not return calls from the Daily Business Review. Carl Schuster, managing partner of Ruden McClosky, declined to comment on pending litigation. This is the second time this year that sanctions have been levied against Ruden McClosky and Mandelkorn. In February, Judge Middlebrooks slapped Mandelkorn with $10,000 in fines and barred him from practicing alone in federal court for two years. Mandelkorn and another lawyer, Norman Ganz, were representing former BellSouth employees in a racial discrimination suit against the phone company. Middlebrooks found that the two attorneys agreed to take a $120,000 “consulting fee” from BellSouth out of the settlement in the case. In return, they agreed never to sue the phone company again. Ganz stopped practicing law in 1998. OCEAN SPRAY SUIT In June 1998, Mandelkorn filed suit against Ocean Spray’s grapefruit processing plant in Vero Beach, Fla., on behalf of black employees. In the complaint, which later was amended to include 34 employees, he alleged that the company for 20 years practiced racial discrimination and racial harassment and failed to promote based on race. The suit claimed that only one African-American at the company ever became a supervisor, and he was later fired. It also contended that blacks were the first to be laid off at the company, which was described in the suit as a “Jim Crow” outfit. During depositions and discovery, Ocean Spray and its lawyers found inconsistencies and exaggerations. In December 1998, they filed for sanctions against Mandelkorn and three other Ruden lawyers, Paul Ranis, John Moore and Sharon Attis, as well as a solo lawyer named Saul Smolar, who was working with Ruden lawyers on the case. Despite those alleged inconsistencies, Ocean Spray settled with nearly a third of the 34 plaintiffs. It did so at least partly because the company received a letter from the NAACP, of which Ganz was general counsel, indicating that the venerable civil rights group might get involved in the suit unless the case was settled. Citing confidentially agreements, Shaughnessy declined to state the amount of the settlements. But Judge Seitz either dismissed the cases of the remaining plaintiffs or granted summary judgment to the defendant. On Aug. 24, Garber issued a scathing report and recommendation in response to Akerman’s request for sanctions. He accused Mandelkorn of making unsubstantiated allegations. Specifically, he found that several of the plaintiffs, upon questioning, said that they were not terminated or denied promotion because of their race, and indicated that they were not subject to racial epithets in the workplace. “Plaintiffs’ pleadings are replete with factual inaccuracies, most of which were not corrected even after they were pointed out to plaintiffs’ counsel by the defense,” Garber wrote. “This court cannot and will not turn its back on the outrageous and highly unprofessional conduct of plaintiffs’ counsel in this case.” Garber also chastised Mandelkorn for eventually removing some of the named defendants from the complaint after many hours were wasted by the defense lawyers. “Plaintiffs’ counsel did not conduct a reasonable investigation prior to instituting this litigation,” stated Garber. “Such lack of appropriate investigation warrants the imposition of sanctions for vexatious and bad faith litigation.” The fact that the allegations dealt with the explosive charges of racism was particularly troubling, Garber found, since “the mere allegations of such conduct inflicts great harm upon persons so accused, harm that is likely to follow them for the rest of their lives.” Garber did not assess sanctions against Ranis, Smolar, Moore or Attis, the other plaintiffs’ attorneys in the case. Akerman lawyers have until Thursday to submit their tally of attorneys’ fees related to the case. Carolyn Alvarez, a partner at Akerman, says two Akerman attorneys worked full time on the case between February 1998 and April 1999, and a total of six Akerman attorneys in both Orlando and Miami were involved in the matter.

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