July 22, 2014

Colorado Court of Appeals: Attorney Fee Award Erroneous when Underlying Claim Was to Recover Judgment

The Colorado Court of Appeals issued its opinion in Castro v. Lintz on Thursday, July 17, 2014.

Workers’ Compensation—Tort—Piercing the Corporate Veil—Enforcement of Judgment—Breach of Duty to Creditor—Dismissal—Attorney Fees—CRS § 13-17-201.

In 2010, Castro was employed by Lintz Construction, Inc. He was injured during the course of his employment when he fell from the roof of a building while shoveling snow. Castro filed a workers’ compensation claim against both Lintz Construction and Jonathan Lintz personally. The administrative law judge (ALJ) ordered Lintz Construction to pay Castro benefits in the amount of $4,536.76. The district court later granted Lintz’s motion to dismiss Castro’s claims to enforce the judgment against Lintz on the ground that the claims were barred by the doctrine of claim preclusion, awarding attorney fees to Lintz. The Colorado Court of Appeals reversed the district court’s order.

On appeal, Castro contended that the district court erred as a matter of law in awarding Lintz attorney fees under CRS § 13-17-201. An award of attorney fees under § 13-17-201 is mandatory when a trial court dismisses a tort action under CRCP 12(b). Castro’s claims for disregarding the corporate form (piercing the corporate veil) to recover the money he had already been awarded in the workers’ compensation claim and enforcement of his judgment against Lintz Construction do not sound in tort. Although Castro’s breach of duty to creditor was a tort, the essence of this claim did not sound in tort because Castro sought to recover only the benefits he was awarded. Therefore, the district court erred in awarding Lintz his attorney fees under CRS § 13-17-201.

Summary and full case available here.

Tenth Circuit: Special Master Must Employ Abstraction-Filtration-Comparison Test for Copyright Infringement

The Tenth Circuit Court of Appeals issued its opinion in Paycom Payroll, LLC v. Richison on Friday, July 11, 2014.

David Richison, with his niece and nephew, Shannon and Chad Richison,  formed a payroll processing company, Ernest Group, d/b/a Paycom Payroll, in Oklahoma in the 1990s. During his time with Ernest Group, David wrote two payroll processing software programs, BOSS and Independence. He transferred his authorship interest in BOSS to Ernest Group in the 1990s. When the relationship between David and Chad deteriorated in 2001, David moved to Maryland and formed his own company called Period Financial Corporation. At Period, he wrote a new software program based in part on Independence, which he called Period Indy. In May 2009, Ernest Group filed a copyright infringement lawsuit against David, asserting that Period Indy infringed on Ernest Group’s copyright in BOSS. Ernest Group subsequently filed for copyright on Independence, stating that it was a work for hire. By 2011, David had written another program, Cromwell.

In August 2011, the parties settled and agreed to the entry of a consent decree. All of Ernest Group’s claims were released except its claim for injunctive relief based on copyright infringement, and all rights to Independence were assigned to Ernest Group. The partied agreed that the district court should appoint a special master to write a report regarding whether the Cromwell program infringed on either BOSS or Independence, and the district court should decide the issue based on the special master’s report. The parties disagreed as to which version of Cromwell should be used for the analysis, but not which versions of BOSS and Independence. The special master opined in his report, marked “Attorney’s Eyes Only,” that Cromwell infringed upon both BOSS and Independence. The district court adopted the special master’s findings and ordered that all copies of Cromwell should be destroyed.

After the report was filed, David objected to the “Attorney’s Eyes Only” restriction, noting that as the author of all the software in question, he could assist his attorneys in reviewing the substance of the report. Ernest Group opposed the motion, and the district court denied it, stating that David advanced no grounds to support lifting the restriction. David’s attorneys filed objections to the special master’s report, arguing that the special master failed to conduct the abstraction-filtration-comparison test, or at least that he did not document his application of the test. Ernest Group’s attorneys agreed with the objections to some extent and requested that the report be resubmitted to the master for further findings. Before the district court could rule, Ernest Group’s attorneys mailed David’s “highly critical” objections directly to the special master. David’s attorneys called for a new special master, claiming that Ernest Group had irrevocably tainted the master’s neutrality. The district court, instead of resubmitting the report to the special master, called on Ernest Group’s attorneys to offer a more substantive response to David’s critique of the report, which they did. The district court adopted the special master’s report in its entirety, ruled that Cromwell infringed upon Ernest Group’s copyrights in both BOSS and Independence, and ordered all copies of Cromwell destroyed. This appeal followed.

David raised four issues on appeal: (1) the “Attorney’s Eyes Only” restriction should be lifted, (2) the special master erred by evaluating versions of BOSS and Independence that were never registered with the copyright office, (3) the special master’s report was inadequate and the versions were not substantially similar, and (4) a new special master should be appointed if remand is necessary. The Tenth Circuit evaluated these claims in turn. The Tenth Circuit declined to agree with David on the first claim, noting that he agreed to the restriction in a consent decree and allowing David to view the report was not so fundamental of a right as to be unwaivable, and commenting that such restrictions are common in trade secret litigation. For the second claim, the Tenth Circuit similarly rejected David’s arguments, since he impliedly consented to the versions in two documents submitted to the court and his argument was therefore waived.

As to the third claim, the Tenth Circuit reversed the district court’s adoption of the special master’s report. The Tenth Circuit agreed that the special master should have documented his application of each step of the abstraction-filtration-comparison test, which he did not do. The report contained little evidence that the master performed the abstraction test, and in fact the report seemed to deem abstraction superfluous. Because the abstraction test was not performed, the special master’s findings regarding filtration were limited, and his entire analysis was flawed. The case was remanded for more complete reporting by the special master. In his fourth claim, David requested that a new special master be appointed, due to potential bias from the master receiving David’s critique. The Tenth Circuit disagreed, because the parties had agreed to this particular special master, and also noting that it only addressed David’s contentions in this appeal so if need arose for a different special master in the future that claim would not be barred.

The district court’s judgment was reversed and remanded for further reporting by the special master using the abstraction-filtration-comparison test.

Tenth Circuit: Non-Disclosure of Unedited Film Substantially Prejudiced Party Claiming Defamation

The Tenth Circuit Court of Appeals issued its opinion in Brokers’ Choice of America, Inc. v. NBC Universal, Inc. on Wednesday, July 9, 2014.

Tyrone Clark and his company, Brokers’ Choice of America, Inc. (BCA) sued NBC Universal and some of its employees after Dateline aired a segment called “Tricks of the Trade” that featured snippets of Clark taken from one of his two-day “Annuity University” seminars filmed at BCA’s Colorado campus. The snippets were surreptitiously recorded, and Clark asserts that they were illegally filmed. Only 112 words were taken from the two-day seminar and were used to portray Clark and BCA as teaching insurance agents to employ misrepresentations and use questionable tactics in order to dupe seniors into purchasing inappropriate annuity products. BCA claims that the statements were taken out of context in order to create a false impression and defame Clark and BCA. BCA also asserts a 42 U.S.C. § 1983 claim because Dateline obtained false credentials from Alabama officials in order to surreptitiously film the seminar.

Dateline moved to dismiss the complaint, maintaining that BCA did not allege sufficient facts to show defamation. It also sought to dismiss BCA’s civil rights claims, stating that BCA’s factual allegations did not demonstrate the help received from Alabama officials was joint conduct. The court granted Dateline‘s motion. BCA appealed, contending the district court failed to credit its allegations as true and improperly made factual determinations to reach its conclusions.

The Tenth Circuit first examined the court’s dismissal of BCA’s claims. The Tenth Circuit determined that BCA had alleged sufficient facts to support its defamation claims, noting that the correct inquiry was not the district court’s determination that the statements were substantially true but rather whether the characterization of BCA was substantially true, a question of fact to be determined by a jury. Because Dateline had contested discovery of its unedited video, the only evidence that could have been used to determine whether the characterization was substantially true, the Tenth Circuit turned its inquiry to the video.

After a lengthy discussion, the Tenth Circuit determined that Colorado’s media privilege statute, C.R.S. § 13-90-119, required disclosure of the video. The Tenth Circuit found that BCA would be substantially prejudiced by non-disclosure, and noted that the statute is to be used as a shield to protect confidential informants, not a sword to defeat potentially viable claims. The “probable falsity” test was unwarranted where no confidential informant existed.

As to BCA’s § 1983 claims, the Tenth Circuit found no merit. The Tenth Circuit noted that the government frequently engages in deception to further investigative interests, and the Alabama officials’ furnishing of broker licenses to the Dateline crew amounted to no more than investigative deception.

The dismissal of the § 1983 claim was affirmed. The dismissal of the defamation claim was reversed, and the case was remanded for further proceedings consistent with the opinion.

Tenth Circuit: Three-Year Statute of Limitations for General Tort Applies to Childhood Sexual Abuse Claims

The Tenth Circuit Court of Appeals issued its opinion in Varnell v. Dora Consolidated School District on Tuesday, July 1, 2014.

Plaintiff Varnell was allegedly sexually abused by her coach, Amber Shaw, beginning in 2005 and ending in early 2007, when plaintiff was in seventh through ninth grades at Dora Consolidated School District. On May 24, 2012, when she was 20 years old, plaintiff brought suit against Shaw, Dora Schools, and Dora Schools superintendent Steve Barron under the New Mexico Tort Claims Act, the Civil Rights Act of 1871, and Title IX of the Education Amendments Act of 1972. She later sought to amend her complaint to add additional parties and claims. On defendants’ motion, the district court dismissed the claims as time-barred, denied the amendments to the complaint as futile, and dismissed without prejudice the state court claims. Plaintiff appealed.

The Tenth Circuit affirmed the district court’s judgment. The Tenth Circuit evaluated applicable statutes of limitation for the federal claims, noting that § 1983 does not contain a statute of limitations. It therefore evaluated local state statutes of limitations, and decided that New Mexico’s three-year statute of limitations for tort personal injury claims under § 1983 applied. Because of her minority at the time of the abuse, plaintiff would have been given one extra year after achieving majority in which to file suit, but she did not file until she was 20 years old. Plaintiff argued that the statute should have been further tolled due to alleged incapacity. However, she brought forth no evidence of incapacity and was a college student pursuing a biology degree at the time of the appeal, evidencing an ability to manage her own affairs. Plaintiff also argued that the limitations period was tolled because she did not realize the extent of her psychiatric injury until 2012. This argument failed as well, since under Supreme Court precedent in Wallace v. Kato, 549 U.S. 384 (2007), the common-law tort claim closest to plaintiff’s injuries was battery, and the statute of limitations would have begun to run in early 2007, when the last incident occurred. Plaintiff erroneously relied on the “discovery rule,” which delays accrual of a claim until the discovery of the claim, stating that she did not discover the extent of the damage until 2012. However, quoting Wallace, the Tenth Circuit noted that the cause of action accrues even though the full extent of the injury is not known or predictable, because if it were otherwise, “the statute would begin to run only after a plaintiff became satisfied that he had been harmed enough, placing the supposed statute of repose in the sole hands of the party seeking relief.” Wallace, 549 U.S. at 391.

Plaintiff also alleged that the district court erred by dismissing her state court claims without prejudice instead of remanding them, but the Tenth Circuit noted that the district court properly exercised its discretion under 28 U.S.C. § 1367, and that she would have had 30 days in which to bring her claims in state court after they were dismissed in federal court. Finally, plaintiff contends that the district court erred by denying as futile her motion to amend. Because her claims were time-barred and plaintiff failed to present any argument as to why the amendments would not be time-barred in her opening brief, the Tenth Circuit found no error.

The judgment of the district court was affirmed on all counts.

Tenth Circuit: Bankruptcy Reorganization Does Not Create Separate Legal Entity

The Tenth Circuit Court of Appeals issued its opinion in ASARCO LLC v. Union Pacific Railroad Co. on Monday, June 23, 2014.

ASARCO, along with Union Pacific Railroad Corp. and Pepsi Co., operated in a four-square-mile area in Denver known as the Vasquez site, which was found to be environmentally contaminated. The EPA brought a CERCLA action against ASARCO. The CERCLA action was still pending when ASARCO filed for Chapter 11 bankruptcy in the Southern District of Texas. The EPA filed proofs of claim in ASARCO’s bankruptcy case to recover its expenses for cleaning the Vasquez site. ASARCO eventually moved for approval of a settlement agreement, in which it would agree to pay over $1.5 million to resolve its CERCLA claims at the Vasquez site and other sites, and the bankruptcy court approved the settlement on June 5, 2009. The bankruptcy plan was also approved, which reorganized ASARCO as ASARCO LLC and noted that all claims, including any pending environmental claims, would be paid in full on the effective date of December 9, 2009.

ASARCO LLC filed a lawsuit against Union Pacific and Pepsi on December 10, 2012, asserting that it paid more than its fair share for environmental remediation at the Vasquez site. ASARCO LLC brought two claims: a direct contribution claim under CERCLA, and a contribution claim as debtor-ASARCO’s subrogee under CERCLA. The magistrate judge recommended dismissal of both claims – as to the first claim, it found that the claim was untimely, as it was brought more than three years after the date the bankruptcy court approved the settlement. As to the second claim, the magistrate judge rejected ASARCO’s argument that it was a separate legal entity from debtor-ASARCO and it could not be subrogated to itself. The magistrate judge also noted that CERCLA provided the exclusive legal remedy to ASARCO’s claims. The district judge accepted the magistrate judge’s recommendations and dismissed the complaint in its entirety. ASARCO appealed to the Tenth Circuit.

ASARCO first argued that its claim was not barred by the statute of limitations. The Tenth Circuit commented that the plain language of the statute did not support ASARCO’s argument, since the statute refers to the date the judicially approved settlement is entered. The Tenth Circuit also noted that all of the case law cited by ASARCO counseled the same result, that the statute of limitations had expired prior to ASARCO’s filing of the complaint. As to the second argument, the Tenth Circuit denied that ASARCO became a separate legal entity after bankruptcy reorganization, and noted that an entity cannot become subrogated to itself. Because the direct contribution claim was time-barred and because ASARCO is not a subrogee, the Tenth Circuit affirmed the district court’s order.

Colorado Court of Appeals: Defamatory Statements Cannot Be Proved to Assert Actual Facts Against Plaintiff

The Colorado Court of Appeals issued its opinion in Giduck v. Niblett on Thursday, July 3, 2014.

Defamation—Personal Jurisdiction—Failure to State a Claim.

Plaintiffs Giduck and his wife are Colorado residents. Giduck carried out various servicesthough a business called Archangel Group, Ltd.

Plaintiffs sued seven defendants for defamation (libel per se and libel per quod); trespass; assault; invasion of privacy; intentional interference with contract; tortuous interference with prospective business advantage; extreme and outrageous conduct; civil conspiracy; aiding and abetting tortuous conduct; preliminary and permanent injunction; and violation of the Colorado Organized Crime Control Act, based on various Internet postings by defendants. Plaintiffs claimed defendants “waged a public campaign of defamation all over” the Internet to discredit Giduck. Defendants filed separate but similar motions to dismiss, which the trial court granted.

On appeal, plaintiffs argued it was error: (1) to conclude defendants’ statements were constitutionally privileged; (2) to dismiss claims three through twelve as a sanction for improperly amending their complaint; and (3) to grant defendant Monger’s motion to dismiss for lack of personal jurisdiction. The Court of Appeals addressed the personal jurisdiction issue first, because all of defendants except Martin asserted they were not subject to the in personam jurisdiction of the Colorado District Court. The Court concluded that plaintiffs failed to establish the district court’s personal jurisdiction over the foreign defendants and therefore the dismissal as to those defendants was proper.

The Court found a failure by defendants to make a prima facie showing of specific personal jurisdiction over them. Accordingly, the dismissal of foreign defendants was affirmed.

The dismissal involving Martin was based on the district court’s conclusion that all the statements made by defendants were protected opinion. The Court affirmed this ruling. Plaintiffs alleged that Martin made two defamatory statements. The Court concluded that both statements could not be reasonably interpreted as stating actual facts about Giduck.

The Court affirmed the dismissal of claims three through twelve because plaintiffs failed to comply with its order for a more definite statement. It found nothing was added to the amended complaint that tied any defendant to any of the nine claims.

Because the district court properly dismissed the complaint against all defendants pursuant to CRCP 12(b)(2) or 12(b)(5), they were entitled to their reasonable attorney fees incurred on appeal. The judgment was affirmed and the matter was remanded for a determination of reasonable attorney fees.

Summary and full case available here.

Colorado Court of Appeals: Online Travel Companies Do Not Actually Furnish Lodging and Therefore Are Not Liable for Lodger’s Tax

The Colorado Court of Appeals issued its opinion in Expedia, Inc. v. City & County of Denver on Thursday, July 3, 2014.

Online Travel Companies’ Collection of Municipal Taxes for Hotel Accommodations.

The City and County of Denver (City) imposes a Lodger’s Tax of 10.75% on the purchase price for lodging. “Lodging” includes overnight accommodations, furnished for consideration, in a hotel or similar establishment. The tax must be collected from travelers and remitted to the City by “vendors.” The City argued that plaintiff online travel companies (OTCs) are vendors that must collect and remit the Lodger’s Tax on the fees they charge their customers, in addition to the tax on the room rate charged by the hotel.

The OTCs facilitate booking reservations on behalf of its customers. The OTC calculates the Lodger’s Tax based solely on the discounted room rate charged by the hotel, excluding the additional fees collected from the traveler and retained by the OTC. The OTC does not disclose to the customer the discounted rate the OTC pays the hotel, the amount representing the OTC’s fees, or the portion of the final price attributable to the Lodger’s Tax.

The hotel invoices the OTC for the contractual room rate and the Lodger’s Tax on that discounted rate. The hotel assumes responsibility for remitting the collected Lodger’s Tax to the City. The Lodger’s Tax remitted is based on the discounted rate charged the OTC, but the City argued it should be based on the full amount paid by the customer to the OTC.

The City began investigating the OTC’s obligations under the Lodger’s Tax in 2003. The City took no action until 2010, when it issued the assessments at issue in this case. The City’s manager of finance issued Lodger’s Tax assessments to the OTCs from 2001 through April 2010 totaling $40 million.

The parties stipulated that if they were liable for the Lodger’s Tax on their fees since 2001, they owed $4,652.522 in back taxes, not including penalties and interest. A hearing officer found that the OTCs were liable for the tax since 2001, and they owed interest and a 15% nonpayment penalty.

The district court affirmed, but found error in the hearing officer not having applied the ordinance’s three-year limitations period relevant to tax assessments. It therefore vacated the assessments to the extent they pertained to taxes payable more than three years before the date of the assessments. The OTCs appealed the portion of the order holding them liable, and the City cross-appealed the application of the statute of limitations.

The Court of Appeals held that the Lodger’s Tax did not apply to the fees charged by the OTCs for two reasons: (1) the OTCs are not vendors within the meaning of the ordinance because they do not furnish lodging, and (2) their fees are not included within the purchase price for lodging under the ordinance because the fees are not directly connected with the furnishing of lodging. The City argued that making sales of lodging is synonymous with selling lodging. The Court agreed that the OTCs are not vendors under the ordinance because they do not actually furnish lodging. It was an abuse of discretion to find otherwise.

The Court found that OTC fees are not directly connected with furnishing lodging because they are compensated only for providing travel-related information and online facilitation services. Therefore, under a provision of the Lodger’s Tax, their fees are excluded. The matter was remanded to vacate all of the tax assessments against the OTCs.

Summary and full case available here.

Colorado Court of Appeals: Automatic Reversal Still Required in Civil Case Despite Supreme Court’s Ruling in Novotny

The Colorado Court of Appeals issued its opinion in Morales-Guevara v. Koren on Thursday, July 3, 2014.

Motor Vehicle Accident Damages Calculation—Jury Selection—Automatic Reversal Rule.

At trial, defendant did not dispute that she caused a motor vehicle accident by driving while intoxicated. Damages were in dispute. Defendant challenged plaintiff’s claim that the accident was the cause of a heart attack he suffered two months later.

During voir dire, there was an exchange between plaintiff’s counsel and a prospective juror concerning whether she could properly apply the burden of proof to the issue of the causation of the heart attack. After receiving a negative response, plaintiff challenged her for cause. Neither defendant nor the court tried to rehabilitate the prospective juror. The court denied the challenge, plaintiff removed the juror using a peremptory challenge, and plaintiff then exhausted his remaining peremptory challenges.

On appeal, plaintiff raised two issues: (1) whether the trial court abused its discretion in denying plaintiff’s challenge for cause to the prospective juror and, if so, (2) whether the “automatic reversal rule” announced in the civil case of Denver City Tramway Co. v. Kennedy,50 Colo. 418, 117 P. 167 (1911), remains binding after the Supreme Court’s decision in the criminal case of People v. Novotny, 2014 CO 18, 320 P.3d 1194.

The automatic reversal rule provides that, when a trial court improvidently denies a challenge for cause to a prospective juror and then, after exercising a peremptory challenge to that juror, a litigant exhausts his or her peremptory challenges, reversal is required without a showing of prejudice. The resolution of this issue turns on whether the Supreme Court overruled Denver City Tramway and its progeny in Novotny.The Court of Appeals concluded that the trial court abused its discretion in denying the challenge for cause and the automatic reversal rule still applies in civil cases, thereby requiring reversal.

Here, the record disclosed that the prospective juror clearly stated she would be unable to follow the law. She made no affirmative assurance that she would follow the court’s instructions after expressing her unwillingness to do so. She should have been excused from the jury and it was an abuse of discretion not to do so.

The Court also discussed the case law behind the automatic reversal rule and the recent Novotny decision. It concluded that Novotny did not overrule Denver Tramway and its progeny, and that the application of the automatic reversal rule still controls in the civil context. The judgment was reversed and the case was remanded for a new trial.

Summary and full case available here.

Colorado Appellate Rules Amended by Colorado Supreme Court

On Wednesday, June 25, 2014, the Colorado State Judicial Branch announced Rule Change 2014(08), amending several of the Colorado Appellate Rules. The rule change was adopted June 23, 2014, effective immediately.

Most of the changes to the Colorado Appellate Rules were minor, including typographical corrections and changes to reflect current procedures regarding filing practices. Some changes amended the Rules to reflect Rule of 7 changes.

For the full text of the rule change, click here.

Colorado Supreme Court: Threatening Statements Not Protected by Psychologist-Patient Privilege

The Colorado Supreme Court issued its opinion in In re People v. Kailey on Monday, June 23, 2014.

Who May Not Testify Without Consent—CRS § 13-90-107(1)(g)—Civil Liability—Mental Health Providers—Duty to Warn—CRS § 13-21-117(2).

In this original CAR 21 proceeding, the Supreme Court held that if a mental health treatment provider believes that statements made by a patient during a therapy session threaten imminent physical violence against a specific person or persons, and accordingly trigger that provider’s legal duty to warn under CRS §13-21-117(2), the patient’s threatening statements are not protected by the psychologist–patient privilege provided by CRS § 13-90-107(1)(g). Consequently, the Court also held that the trial court erred when it excluded threatening statements made by a patient to a mental health treatment provider on the ground that the statements were barred by the psychologist–patient privilege. The rule was made absolute and the case was remanded for further proceedings.

Summary and full case available here.

Colorado Supreme Court: CRE 803(4) Allows Statements to Physician for Diagnosis or Treatment of Medical Condition So Statements Properly Admitted

The Colorado Supreme Court issued its opinion in Kelly v. Haralampopoulos on Monday, June 16, 2014.

Evidence—Statements Made for Purposes of Medical Diagnosis or Treatment.

Respondent suffered a cardiac arrest during a fine-needle aspiration biopsy. He failed to respond to routine resuscitation efforts, and the resulting brain injury left him in a vegetative state. The trial court held that statements made to a physician by a family friend, asking whether respondent’s cocaine use may have contributed to his heart attack and failure to respond to resuscitation efforts, were admissible under CRE 803(4). The court of appeals reversed, finding that the trial court abused its discretion by admitting evidence of respondent’s cocaine use.

The Supreme Court held that the court of appeals erred in limiting the scope of CRE 803(4) to statements made for the purpose of prospective treatment. The Rule’s plain language applies to “diagnosis or treatment.” Although the term “treatment” has a prospective focus, the term “diagnosis” does not. Instead, diagnosis focuses on the cause of a patient’s medical condition, and may or may not involve subsequent treatment. Here, statements made by the family friend were made for the purpose of discovering the cause of respondent’s cardiac arrest and failure to react to normal resuscitation efforts, and were thus admissible under CRE 803(4). Accordingly, the court of appeals’ judgment was reversed.

Summary and full case available here.

Colorado Supreme Court: Trial Court Unreasonably Denied Defense Counsel’s Motion to Withdraw Despite Irreconcilable Conflict of Interest

The Colorado Supreme Court issued its opinion in In re People v. DeAtley on Monday, June 16, 2014.

CAR 21 Original Proceeding in Criminal Case—Defense Counsel Motion to Withdraw—Implied Waiver of the Right to Counsel—Arguello Advisement.

The Supreme Court held that the trial court unreasonably and unfairly determined that the attorneys in this case could effectively represent defendant, despite his discharge of them and the trial court’s previous finding that a conflict of interest existed between defense counsel and defendant due to defendant’s filing of a malpractice and breach of contract lawsuit against defense counsel. After concluding that defendant was engaging in trial-delaying conduct, the trial court chose the wrong remedy and thereby abused its discretion. The trial court’s finding that the attorneys could balance their personal interests implicated by defendant’s actions with their obligation to represent him was arbitrary, unreasonable, and unfair given the trial court’s first finding that a conflict existed. It should have granted the motion to withdraw and proceeded in accordance with Crim.P. 44(a), advising defendant that he had the obligation to hire other counsel, request the appointment of counsel by the court, or elect to represent himself. In view of defendant’s delay-causing conduct, the trial court should have given him an Arguello advisement, explaining the consequences of engaging in trial-delaying conduct, which can result in an implied waiver of the right to counsel, and explaining the risks of proceeding without counsel. [See People v. Arguello, 772 P.2d 87, 92–94 (Colo. 1989)]. The Court reversed the trial court’s denial of the motion to withdraw and made the rule absolute.

Summary and full case available here.