People of the State of California v. The Law Offices of Kramer and Kaslow, et al., LC094571, Los Angeles County Superior Court, Central Civil West Division

The California Attorney General and the State Bar of California brought actions in August, 2011 against multiple lawyers and law firms and their telemarketing affiliates alleging that they were preying on desperate consumer homeowners facing foreclosure by selling them participation in so-called “mass joinder” lawsuits against mortgage lenders.  The Attorney General complaint included claims for unfair business practices, false advertising, and the illegal use of non-attorneys to solicit business for a lawyer or law firm.  Simultaneously, the State Bar of California sought and received Possession Orders as to the attorney defendants in separate actions filed by the State Bar.

In the Attorney General action, we were appointed receiver of the Non-Attorney Defendants (the telemarketers who ran call centers at seven different locations) and certain assets of the Attorney Defendants. As Receiver, we took possession of seven separate call room operations in Orange and Los Angeles County and thereafter shut them down.  These telemarketers also sold illegal loan modifications services, sometimes disguised as “alternative dispute resolution”, but those services were generally a prelude to the “mass joinder” lawsuit offerings.  We worked closely with the Attorney General and the State Bar as they proceeded with their highly complex cases involving more than 6,000 consumer victims who purchased seats in the mass joinder litigation.  Both the AG and the State Bar cases have been settled, except as to one Defendant in the Attorney General’s case who is incarcerated. 

Under Court supervision and the concurrence of the Attorney General and the State Bar, we administered a $700,000 restitution program with notice to the full universe of 9,000 consumers as prospective claimants followed by the processing and review of claims and pro rata payments to approved claimants.  After completion of this restitution program, the receivership was terminated in March, 2016.