Trevor Group lawyers face disbarment
By NANCY McCARTHY
Three Beverly Hills attorneys who have sued thousands of small business owners
for unfair business practices face possible disbarment after the State Bar moved
last month to lift their law licenses.
The three, who are principals with Trevor Law Group, also were sued by the
Attorney General, who charged them with using the same unfair business practices
they accuse their defendants of using.
At an April 7 hearing, the bar will ask its disciplinary court to place the
attorneys on involuntary inactive status for violating various ethical rules
to obtain money fraudulently from small business owners. "The evidence
we collected establishes that the respondents constitute a substantial threat
of harm to the public if they are allowed to continue to practice," said
Chief Trial Counsel Mike Nisperos.
The three lawyers are Damian S. Trevor, 29, Allan Charles Hendrickson, 39, and Shane Chang Han, 32.
Nisperos said a 40-person task force from his office collected evidence showing
the men filed baseless lawsuits, committed mail fraud, violated court orders,
directly contacted represented defendants in cases they initiated, and engaged
in abuse of process and illegal fee-splitting. They also sent settlement agreements
to defendants falsely promising no one else could sue them.
The petition alleged the trio filed suits against at least 3,000 defendants,
committing repeated acts of malicious prosecution.
Their extensive misconduct entailed numerous acts of moral turpitude, dishonesty
or corruption, Nisperos said.
After the April 7 hearing, the bar has 45 days to file formal disciplinary
charges against the three and Nisperos said he will seek their disbarment.
"These are bad lawyers who use consumer protection laws as a front to
rip off innocent, hard-working business owners who are vulnerable to exploitation,"
Correa, D-Santa Ana, who held a hearing in January to hear from hundreds of
constituents who were sued by Trevor.
According to bar attorney Jayne Kim, the Trevor lawyers conspired to create
a group called Consumer Enforcement Watch, which she called "a shell corporation
created solely for the corrupt purpose of making money."
With CEW as the plaintiff, Trevor filed lawsuits against automotive repair
shops and restaurants for violations listed on the web sites of the Bureau of
Automotive Repair and the Los Angeles County Department of Health Services.
The lawyers typically then contacted the defendants in an effort to obtain
settlements of thousands of dollars. Bar prosecutors said the Trevor lawyers
used hostile tactics including threats of further action, such as reporting
the defendants to the IRS or the Immigration and Naturalization Service, and
demands that the defendants produce three to five years of business records,
including confidential information such as tax returns.
In what prosecutors described as "unconscionable fee agreements"
with CEW, the lawyers received 70 to 90 percent of all settlement funds and
CEW received the remainder.
Nisperos said Trevor also signed up a nonprofit group, Helping Hands for the
Blind, for which it filed four suits. When it engaged Helping Hands, one of
the Trevor lawyers actually read the retainer agreement to the group's blind
executive director, Robert Acosta, but did not read it accurately, which Acosta
discovered when his own attorney read it to him.
Trevor filed four suits on behalf of the group, but kept the $3,710 it collected,
Prosecutors do not know how much money the firm has made as a result of the
lawsuits, nor do they know how many businesses might have closed up shop as
a result. Kim said Han and Hendrickson have indicated they settled 70 to 80
cases, and the standard offer was about $2,500, depending on the defendant and
the number of violations.
Prosecutors also said two of the three Trevor lawyers made misrepresentations
at a joint Senate-Assembly judiciary committee hearing, held in Sacramento in
January. They also are accused of making false statements to defense counsel
and to the public through the media.
In addition, Nisperos said Han failed the bar exam after graduating from law
school, but joined Hendrickson and Trevor as a partner and practiced law without
a license. Hendrickson and Trevor were aware Han was unlicensed and acted as
co-conspirators in misdemeanor unauthorized practice of law, Nisperos said.
He said the three lawyers also committed mail fraud by mailing or faxing letters
and settlement documents which contained false and misleading statements.
Evidence of criminal wrongdoing by the trio will be turned over to law enforcement
"for them to proceed as they see fit," he said.
In filing their actions, the Trevor lawyers used §17200 of the Business
& Professions Code, also known as the Unfair Competition Law. The law generally
is viewed as a powerful tool to protect members of the public from a variety
of unsavory business practices and has been used successfully to sue slumlords,
the tobacco industry and to stop health maintenance organizations from deceptive
door-to-door marketing practices.
Following the overwhelming number of complaints from defendants in the Trevor
actions, as well as suits filed by other southern California firms, lawmakers
have introduced 11 bills to reform §17200.
"The Unfair Competition Act does not distinguish between genuine suits
that protect the public and suits like Trevor's that harm the public,"
said Correa. "Reasonable reform is needed to stop further Trevors."
Ironically, Attorney General Bill Lockyer used §17200 in charging the
Trevor lawyers themselves with using unfair business practices, solely to obtain
nuisance settlements and attorney's fees.
The complaint, filed in Los Angeles Superior Court, seeks full restitution
and asks the court to impose civil penalties of at least $1 million. It also
requests the court to order the Trevor lawyers to drop all lawsuits they brought
under §17200 and seeks a permanent injunction barring them from filing
new lawsuits without court approval.
"The Trevor Law Group operates a shakedown operation designed to extract
attorney's fees from law-abiding small business owners," Lockyer said.
Their "real purpose is to obtain monetary payment for themselves to which
they are not entitled."
He accused the Trevor lawyers of seeking settlements of between $6,000 and
$26,000 from auto repair shops and between $7,000 and $13,000 from restaurant
owners. Lockyer also sued Ron Jamal Kort, the owner of CEW.
Nisperos said that even after Lockyer sued them, the Trevor lawyers continued
to file lawsuits based on §17200.
The bar also is investigating the Brar & Gamulin firm in Long Beach as
well as other attorneys it has not named.
Lockyer said he is investigating Brar & Gamulin and its plaintiff organization
Consumer Watchdog as well, in addition to three other firms and their plaintiff
organizations: Callahan, McCune & Willis of Tustin and Citizens for Fair
Business Practices; Brian Kindsaver of Sacramento and Consumer Action League;
and David Byers of Sacramento and Californians for Fair Business Practices.