Lawyers Sanctioned Over Suit Involving Bogus Cancer Claims

By Dennis Pfaff
Daily Journal Staff Writer

      SAN FRANCISCO - A federal judge Tuesday sanctioned a Los Angeles attorney and two out-of-state lawyers, citing their "unreasonable and incompetent" actions in putting forward bogus cancer-related claims by Ecuadorian plaintiffs against Chevron Corp.
      U.S. District Judge William Alsup ordered one of the lawyers, Cristobal Bonifaz of Massachusetts, to pay $45,000 toward the costs of defending the case. Gonzales v. Texaco Inc., 0602820WHA.
      He ordered the other two, Paul Hoffman of Schonbrun, De Simone, Seplow, Harris & Hoffman in Venice, and Terry Collingsworth of Washington's International Rights Advocates, to be responsible for any amount Bonifaz does not pay.
      The litigation involves accusations stemming from alleged pollution by the operations in Ecuador of a subsidiary of Texaco Inc. Chevron acquired Texaco in 2001.
      The lawsuit is separate from a case pending in Ecuador that also formerly involved Bonifaz and which centers on claims of widespread dumping of toxic wastewater. Chevron has asked the courts in Ecuador to throw out that case, claiming it is being denied a fair trial.
      Tuesday's action follows Alsup's dismissal in August of three plaintiffs from the case after evidence surfaced showing the cancer claims were untrue. Gone from the case were a woman who claimed her son had been diagnosed with leukemia, another woman who purportedly had breast cancer, and the woman's husband, who claimed physical and emotional problems stemming from his wife's surgery.
      At a hearing before the plaintiffs were dismissed, Bonifaz apologized for what happened. But he said the plaintiffs had fooled the attorneys.
      Two plaintiffs out of an original nine remain in the case. Four others dropped out, according to Alsup's 21-page sanctions ruling.
      Alsup put most of the onus on Bonifaz, the lead attorney in the litigation. The judge, however, had scathing words for all three lawyers.
      "This order finds that attorney Bonifaz was the primary lawyer at fault and bears the most responsibility for the team's deficient performance," Alsup wrote.
      "But attorneys Collingsworth and Hoffman likewise signed pleadings without reasonable and competent investigation," the judge wrote. "The totality of all their inquiry was so minimal as to be unreasonable and incompetent."
      He noted that prior to filing the lawsuit, none of the three attorneys interviewed the plaintiffs. Instead, they relied on a paralegal in Ecuador who was working for a lawyer friend of Bonifaz.
      Alsup found that there had been several "warning flags" that something was wrong with the cancer claims. Those included an intake form that left blank the first date of a cancer diagnosis and no doctor's statement that the cancer was likely due to petroleum contamination.
      Bonifaz, who is originally from Ecuador, should have interviewed and counseled the plaintiffs, Alsup wrote. The other two lawyers, who signed succeeding versions of the lawsuit, should also have done more, he found.
      "Collingsworth and Hoffman knew or should have known how weak was the evidentiary support and that the inquiry was neither competent nor reasonable," Alsup wrote. He theorized, for instance, that Hoffman could simply have asked how it was known the plaintiffs had cancer or whether their medical records had been obtained.
      Alsup found that the defense had spent more than $80,000 on exposing the claims, largely by having to go to Ecuador for depositions. But he said he needed to set an amount that would deter similar conduct in the future and he settled on the $45,000, "taking into account the public interest nature of the lawyers involved and their limited pocketbooks."
      In addition to the monetary sanctions, Alsup required all three attorneys to provide a copy of Tuesday's order to their respective state bars.
      Chevron had asked for sanctions but Alsup awarded them using his own authority under Rule 11 of the Federal Rules of Civil Procedure.
      A lawyer for Chevron, Robert Mittelstaedt of San Francisco's Jones Day, referred questions to a company spokesman who said he was reviewing the ruling.
      Neither Hoffman nor Bonifaz could be contacted Tuesday. Reached by telephone, Collingsworth said "there was a terrible mistake made here and I certainly respect the court's frustration."
      But he said none of the plaintiff attorneys expected the fabrication.
      "We had no reason to doubt that what we were being told by these individuals was true," Collingsworth said.
      He said there might be grounds for an appeal because Chevron did not follow the proper steps in pursuing sanctions under federal civil procedure rules. Those rules give time for challenged statements to be corrected.
      Alsup, however, wrote in a footnote that while the defendants did not comply with those procedures, judges could impose sanctions on their own initiative.
     

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