Texas Attorney and Client Ordered to Pay $150,000 for ‘Outright Lies’ in Court
JAN 25, 2021 | REPUBLISHED BY LIT: JAN 27, 2021
A judge has ordered a Houston-area attorney and his client to pay $150,000 in sanctions for filing groundless litigation that kept repeating false claims that the court had determined amounted to perjury by the client.
Bellaire solo practitioner Paul Rosen violated Texas law and civil procedure rules by filing the frivolous court documents in a commercial lease dispute, causing the opposing side’s legal bill to climb by more than $200,000, and wasting the court’s time and resources, ruled Judge O’Neil Williams of the 268th District Court in Fort Bend County in a Jan. 21 sanctions order.
‘Mountain of evasiveness’
It was egregious perjury and misconduct, and shows total disregard and lack of respect for the court and justice system, the judge ruled.
Williams also imposed part of the sanction for discovery abuses.
“This is not an incident of failing to produce one document or telling one lie, but a mountain of evasiveness, lack of candor, concealment, numerous outright lies and a total disregard for truth, which is the foundation of our judicial system,”
“These abuses were not isolated or accidental, but willful, deliberate and calculated in an effort to perpetuate a fraud on this court.”
Rosen didn’t respond to a call or email seeking comment.
His opposing counsel, Foster Johnson, said he’s never seen more egregious conduct in his legal career. He hoped the large sanctions award would serve as a warning for the legal profession.
“Lawyers at times forget filing motions and pleadings is not like using Twitter. You can’t just say anything you want when you file a complaint. You can’t say anything you want when you file a summary judgment motion. This case is a very real example of what happens when lawyers bring frivolous lawsuits that are premised on claims that are obviously false,”
said Johnson, associate with Ahmad Zavitsanos Anaipakos Alavi Mensing in Houston.
“It issues a warning to other lawyers of potential consequences of making up your own facts in litigation.”
The court determined that Rosen, the plaintiffs attorney, should face the sanctions along with the client because he did not do a reasonable investigation about the law and the facts before he filed the litigation. He would have seen his clients were making untrue claims if he had investigated the facts.
Rosen’s lack of investigation and his clients’ falsehoods caused the court to grant the plaintiffs a temporary injunction. The court dissolved the injunction when it found the clients had perjured themselves multiple times, said the order.
Yet Rosen still continued with his misconduct.
“Rather than correct the false and misleading claims in the second amended petition after the court dissolved the injunction, Mr. Rosen, ignoring the opportunity to cure the harm caused by his clients, then filed an amended summary judgment motion repeating the same untrue claims,” the order explained.
Rosen was the attorney for plaintiffs Gen Fu Zhang, Limin Wang and ChiChi Chicken Inc. in litigation over a commercial lease dispute.
Zhang perjured himself by falsely claiming in amended petitions that he did not know that one of his properties was being used as collateral. He lied by saying that the defendant, Peterson New Territory Investors, knew that he and his wife lived at the property–that it was their homestead–when the transaction happened, the court ruled.
Another lie was Zhang saying he didn’t authorize a woman to sign a guarantee for him, and that he had unwittingly signed a power of attorney, the judge found. All of Zhang’s false statements were contradicted by later testimony, a deposition and emails that were sent during the 2017 lease transaction with Peterson, the judge wrote in the sanctions order.
The court determined Zhang had also perjured himself in an answer in the litigation by saying Peterson concealed that it required him to execute a note and deed of trust. His son also committed perjury in a declaration on a summary judgment motion by saying he didn’t talk about the lease transaction with Peterson or about placing a lien on the collateral property, the order said. The son’s own emails contradicted his statements.
The court determined that Peterson had to pay more than $238,000 in attorney fees in the litigation. Normally a landlord in a commercial foreclosure case would pay just $20,000 to $30,000, the order said.
The judge found that Rosen and his clients’ violations cost the defendants more than $208,000.
The order didn’t explain why the court awarded only $150,000 in sanctions. Part of the sanction was imposed because of discovery abuses.
“This entire lawsuit was premised on a series of demonstrably false claims, and it was filed to harass Peterson and to unnecessarily delay the case and increase the costs of litigation,” said the order.
“Mr. Zhang and Mr. Rosen abused the judicial process from start to finish.”