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Across the Region: No compensation for lawyer who dated Menards founder

WISCONSIN

Appeals court: No compensation for lawyer who dated Menards founder

An appeals court has found that a lawyer can’t seek compensation for legal services she provided during her relationship with the founder of the Menards chain of home improvement stores because she broke one of the rules of professional conduct for attorneys.

John Menard Jr., founder of the Eau Claire-based Menards, and Debra Sands, a lawyer who was licensed in Minnesota, started dating in 1997. Sands moved into Menard’s home in 1998, and the two were later engaged. The relationship ended in 2006.

Sands sought more than $1 million for the thousands of hours worth of legal work she provided to Menard and his companies during their relationship. In response, Menard and his chief financial officer offered her nearly $200,000 in compensation if she signed a waiver to any other claims.

She refused and filed a lawsuit in 2008 against Menard, his companies and their trustees. Among other things, she alleged that she had been promised part-ownership in the company for work she had performed for Menard and his companies during the relationship.

Menard and his companies sought summary judgement, contending that Sands had failed to follow state rules governing the professional conduct of lawyers and therefore could not claim any part of Menard’s assets or ownership in his companies.

Under Wisconsin Supreme Court rules, when an attorney enters a business transaction with a client, the terms must be fair and reasonable to the client and must be submitted to the client in writing. The client must also be given a chance to seek independent counsel on the matter and must consent to the transaction in writing.

Both Menard and Sands agreed that the Sands had not complied with any part of the rule.

Eau Claire Circuit Court Judge Paul Lenz sided with Menard in 2012, noting that Sands’ claim would not have been barred if her romantic relationship had predated their attorney-client relationship and if her legal services had only been incidental to the relationship.

On appeal, Sands argued that her claim should not be barred, noting that the rules of professional conduct only apply in attorney-discipline cases and do not create a basis for civil liability.

The District 3 Court of Appeals affirmed Lenz’s decision on Tuesday and rejected Sands’ argument. The three-judge panel noted that no case law bars courts from considering the rules of professional conduct in non-disciplinary cases. It pointed to the rules’ preamble, which states that a violation of a rule can serve as evidence of a breach of a particular standard of conduct.

 

Transgender student’s suit against school district advances

A federal judge has declined to dismiss a transgender student’s lawsuit against a Wisconsin school district over its bathroom-use rules.

U.S. District Judge Pamela Pepper rejected a request from the Kenosha school district to dismiss the suit Monday. The Journal Sentinel reports Pepper found the student had alleged enough facts to support a plausible violation of Title IX, a federal law that prohibits discrimination on the basis of sex, as well as the Constitution’s equal protection guarantees.

The district argued the term “sex” under Title IX did not cover a transgender student.

Ashton Whitaker, a student at Tremper High School, was designated a girl on his birth certificate but began identifying as a boy in middle school. Whitaker sued in July, claiming the district’s ban on his using the boys’ restroom was discriminatory.

 

IOWA

State’s use of civil forfeiture without proof of crime scrutinized

An analysis of data from Iowa law enforcement agencies shows they seize cash, vehicles and other private property from at least 1,000 people a year without proof the property was acquired as a result of a crime or was being used to help people commit crimes.

The seizures have increased markedly since the 1980s, when state and local governments reported fewer than two dozen such cases annually. The civil forfeiture laws have let helped the agencies pump millions of dollars into their budgets, mostly in uncontested cases, according to The Des Moines Register’s analysis of data obtained from the agencies. In many instances, the newspaper said, no criminal charges were filed against the person whose property was seized.

Some lawmakers and social justice groups say the agency practices have strayed beyond the original intent of Iowa’s forfeiture laws.

In 1984 the U.S. Congress passed the Comprehensive Forfeiture Act as a weapon to be used against drug traffickers. And in 1986, a change in federal law expanded civil forfeiture to include money-laundering activities and virtually any criminal or regulatory violation.

States soon adopted their own versions.

Polk County has added $18 million in seized cash and the proceeds from nearly 1,500 confiscated vehicles to the budgets of local and state law enforcement agencies since 1985, the analysis shows.

A state Senate bill that would have allowed forfeitures only in cases resulting in criminal convictions failed to make it through the legislative process this year. Sen. Charles Schneider vowed to resurrect it next year.

“My main concern is that assets can be forfeited to the state without a person even being charged with a crime, and I think that runs afoul of the Constitution,” Schneider said.

 

NEBRASKA

Omaha prosecutor seeks faster system for blood alcohol tests

The Omaha city prosecutor wants an electronic system that would streamline the time it takes to obtain a judge’s signature on a warrant seeking a blood test for suspected drunken drivers.

City prosecutor Matt Kuhse said there are legislative proposals coming from his office as well as the Douglas County Attorney’s Office and the Nebraska Attorney General’s Office to alleviate a recent ruling by the U.S. Supreme Court that makes it harder to prosecute drunk driving cases.

The Supreme Court ruled 5-3 on June 23 that police can’t forcibly draw blood from people suspected of driving drunk without a warrant. The ruling stems from three cases in North Dakota and Minnesota in which divers challenged “implied consent” laws as a violation of the Constitution’s ban on unreasonable searches and seizures.

“After the initial shock, everyone took a deep breath,” Matt Kuhse said. “Then we said, ‘We can work this out.'”

Kuhse said he hopes the Nebraska Legislature can create a digital warrant system to make the process more efficient. Electronic warrants would save time for law enforcement officers by allowing them to get permission without having to travel to the judge’s home to get a signature and then a hospital to get the blood test.

Kuhse said speed is critical because alcohol dissipates from the body at a rate of about .015 percent of blood alcohol content per hour.

The ruling has impacted about 20 DUI cases so far, Kuhse said.

In the meantime, Kuhse said local authorities have drafted a template for warrants to help investigators move quickly, and several Douglas County judges have volunteered to make themselves available to review warrants around the clock.

“I sat down with the county judges and explained (the problem) to them,” he said. “Judges who live in close proximity to a hospital said, ‘Hey, if time is of the essence, call me.'”

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