CAOC demands probe into DTLA Law over fraud allegations

The Consumer Attorneys of California have urged an investigation into the Downtown LA Law firm, also known as DTLA Law Group, after a report alleged the firm may have paid former residents of a foster care facility to file false sexual abuse claims against the county.

"The State Bar of California must immediately launch a thorough investigation into the allegations against DTLA Law Group to the fullest extent of its authority," CAOC President Geoffrey S. Wells, who practices with Greene Broillet & Wheeler LLP in El Segundo, said in a news release on Thursday. "This is not a matter that can wait."

The statement addressed allegations that the firm sent "recruiters" to solicit claims from people at a county benefits office, offering up to $200 and, in some cases, a ride to the firm's office.

"Illegal 'capping' and 'running' - generating lawsuits by paying intermediaries to drive claimants to a particular attorney or firm - are corrosive practices explicitly prohibited under California Law (Bus. & Prof. Code § 6152)," Wells' statement continued.

As of Friday morning, Downtown LA Law's website said the firm is no longer taking sex abuse cases related to claims for sex abuse at Los Angeles County camps, facilities and foster care. The firm did not respond to an email requesting comment, or phone call.

In addition to an investigation, the CAOC called for Gov. Gavin Newsom to sign Senate Bill 37, which would allow consumers to sue for unlawful attorney solicitations and legal advertising, as well as an independent audit of plaintiffs in the lawsuit the Los Angeles County Board of Supervisors agreed to settle for $4 billion.

"These allegations of misconduct come at a time when some school district advocates - who appear more interested in protecting abusers than survivors who suffered harrowing atrocities at their hands - are all too ready to exploit rare cases of attorney misconduct to erode public trust in the justice system and strip away the rights of survivors to have their day in court. It is vital that the bar and the administration take strong action to show the public that the legal profession will not tolerate bad actors," the CAOC release said.

In addition to the claims surrounding the foster youth cases, Downtown LA Law is facing a lawsuit by Uber, which the firm has targeted with many personal injury and mass tort cases. The rideshare giant sued the firm, along with the Law Offices of Jacob Emrani, in federal court in July, claiming that the firms colluded with medical providers to create fraudulent medical bills and inflate litigation costs.

A representative for Uber commented on the new allegations against the firm in an email on Friday.

"Fraud and legal abuse raise costs for everyone -- especially here in California. As has been shown with our legal actions to date, we won't hesitate to act when we uncover misconduct," the email said.

While it remains unclear exactly how many plaintiffs Downtown LA Law represents in the settlement, media reports place the number at upwards of 2,000, making the firm one of the most prolific filers in the sex abuse case, along with Slater Slater Schulman LLP, which advertises on its website that it represents 3,500 clients. Jane Doe 1 et al. v. County of Los Angeles, 21STCV20949 (L.A. Super. Ct., filed June 3, 2021).

The Slater firm also came under scrutiny recently for its representation of plaintiffs in bankruptcy proceedings tied to allegations of sex abuse in the Boy Scouts of America. A notice filed by attorneys in that case on Sept. 9 noted that the settlement trust had identified "procedural and factual problems" in some of the firm's claim submissions. Slater subsequently acknowledged the issues, hiring a third-party neutral to review the claims, according to the notice. The case is being handled by a settlement trustee, retired U.S. Bankruptcy Judge Barbara J. Houser in Texas.

Clifford S. Robert of Robert & Robert PLLC in New York, who represents the Slater firm in the matter, addressed the issues in an email on Friday.

"The most important thing is to ensure that survivors who suffered horrific abuse receive justice, and that those who committed horrific abuse are held accountable," Robert said. "That has always been, and will always be, Slater Slater Schulman's top priority. That's why the firm is working tirelessly with the trust to address any outstanding issues."

Ventura-based plaintiffs' attorney Nicholas C. Rowley has been an outspoken critic of the kinds of "capping" schemes alleged in the Los Angeles matter. He praised the CAOC letter and said it needs to be followed by further efforts within the profession to stop illegal and unethical conduct.

"We need to start policing ourselves," Rowley said. "When we know that stuff like this is going on, we need to report these bad actors to the State Bar."

But attorneys cannot rely solely on the State Bar, Rowley said. Attorneys like himself, who are often brought in to argue cases once they make it to court, need to refuse to take referrals from law firms that engage in unethical practices to sign up clients.

"The State Bar is still in the process of rebuilding itself, and I'm proud of the State Bar for that," Rowley said, referring to claims the State Bar ignored reports of misconduct by another plaintiff's attorney, Tom Girardi, who is now in prison for stealing from clients. "The State Bar doesn't have the resources to be sending out undercover agents to catch lawyers running these capping schemes."

The problems in the sex abuse settlement claims were brought to light Thursday by the Los Angeles Times, which said its reporter team spent a year investigating.

Rowley said he was also aware of the effort to bring a case against DTLA. "It's not something I'm going to get personally get involved with, but if there's ever a trial, they can call me."