Shane Beal and The Bar Plan Mutual Insurance Company v. Edwin Blinn, Jr.

FOR PUBLICATION

May 07 2014, 9:28 am

ATTORNEYS FOR APPELLANT: ATTORNEYS FOR APPELLEE:

PHILIP E. KALAMAROS SCOTT A. WEATHERS

Hunt Suedhoff Kalamaros, LLP Carmel, Indiana

St. Joseph, Michigan

IN THE

COURT OF APPEALS OF INDIANA

SHANE BEAL and THE BAR PLAN MUTUAL )

INSURANCE COMPANY, )

)

Appellants-Defendants, )

)

vs. ) No. 27A03-1306-PL-235

)

EDWIN BLINN, JR., )

)

Appellee-Plaintiff. )

APPEAL FROM THE GRANT SUPERIOR COURT

The Honorable Thomas Newman, Jr., Special Judge

Cause No. 27D03-0705-PL-197

May 7, 2014

OPINION - FOR PUBLICATION

RILEY, Judge

STATEMENT OF THE CASE

Appellant-Defendant, Shane Beal (Beal),1 appeals the trial court’s denial of his

motion for summary judgment, concluding that a genuine issue of material fact exist as to

whether Beal’s representation of Appellee-Plaintiff, Edwin Blinn, Jr. (Blinn), in a federal

criminal case constituted legal malpractice.

We affirm.

ISSUES

Beal raises three issues on appeal, which we consolidate and restate as the

following two issues:

(1) Whether the trial court abused its discretion when it denied Beal’s motion to strike

Blinn’s expert evidence; and

(2) Whether the trial court erred in determining that a genuine issue of material fact exists

in a legal malpractice case where the conduct of an attorney resulted in the indictment of

his client and subsequent voluntary guilty plea.

FACTS AND PROCEDURAL HISTORY

The facts of the instant case have been analyzed in several opinions issued by this

court and our federal counterpart. See U.S. v. Blinn, 490 F.3d 586, 588 (7th Cir. 2007);

Beal v. Blinn, No. 27A05-0802-CV-78 (Ind. Ct. App. Oct. 23, 2008); Blinn v. Law Firm

of Johnson, Beaman, Bratch, Beal and White, LLP, 948 N.E.2d 814 (Ind. Ct. App. 2011);

1

Although the Bar Plan Mutual Insurance Co. (Bar Plan) was a defendant before the trial court, they did

not appeal the trial court’s ruling. Pursuant to Indiana Appellate Rule 17, a party of record in the trial

court shall be a party on appeal; therefore, the Bar Plan will appear in the caption of this case.

2

Blinn v. Kammen, No. 27A04-1008-PL-532 (Ind. Ct. App. June 30, 2011). This most

recent installment in a never-ending legal malpractice saga focuses squarely on the issue

at the heart of the dispute: Beal’s actions and conduct during his representation of Blinn

in a federal drug and money laundering investigation.

In early 2003, Beal represented Blinn in a criminal matter which was being

investigated by the Federal Bureau of Investigation (FBI). During the investigation, Beal

allowed Blinn to enter into a proffer agreement with the United States Government,

which, by its express terms, anticipates and requires multiple interviews and debriefings.

In exchange for Blinn’s truthful cooperation, the Government would allow Blinn to plead

guilty to a misdemeanor and agreed not to use Blinn’s statements against him if the

Government later decided to file more serious charges. On April 22, 2003, at the

conclusion of the first proffer session, Beal advised that Blinn had more information and

the proffer session would reconvene on a different day.

Between April 22, 2003 and June 2003, federal agents attempted to contact Beal

on different occasions to schedule a follow-up proffer session with Blinn. On or about

September 9, 2003, federal agents contacted Beal’s office again. After getting no

response to their phone calls, the Agents travelled to Marion, Indiana where they

cornered Beal at the court house. When confronted by the federal agents, Beal declared

that “Blinn was no longer interested in cooperating with the [G]overnment.”

(Appellant’s App. p. 62). The Government indicted Blinn on a federal felony money

laundering charge.

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From April 22, 2003 to September 2003, Beal did not inform Blinn of the FBI’s

requests for an additional interview, nor did Beal inquire after Blinn’s willingness to

continue to cooperate with the FBI. Instead, Beal only informed Blinn of the FBI’s

requests after the agents’ visit on September 9, 2003.

After the indictment, Blinn hired attorney Rick Kammen (Kammen) to serve as his

lead counsel. Because the proffer agreement had collapsed and the immunity attached to

the agreement had dissolved, the Government sought to introduce Blinn’s statements

against him. Kammen objected, but for unspecified strategic reasons, Kammen declined

to call Beal as a witness at an initial hearing on the admissibility of Blinn’s proffer

statements. The federal district court ruled Blinn’s statements admissible. At a

subsequent hearing, Kammen requested the court to revisit the proffer and he called Beal

as a witness. Despite Beal testifying at length about his representation of Blinn and the

proffer agreement, the court declined to change its ruling. Ultimately, Blinn, now

represented by attorney Robert W. Hammerle (Hammerle), negotiated a plea agreement

with the Government, pleading guilty to a felony of conspiring to launder monetary

proceeds in exchange for a sentence of twelve to twenty months’ imprisonment. The

district court accepted the plea agreement and sentenced Blinn to sixteen months’

imprisonment with three years of supervised release, including twelve months of home

confinement.

On April 26, 2007, Blinn filed a pro se complaint against Beal and the law firm of

Johnson, Beaman, Bratch, Beal & White, LLP (Law Firm) for legal malpractice.

Because Blinn omitted to sign the complaint, the Law Firm filed a motion to dismiss. On

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November 1, 2007, Blinn, represented by an attorney, filed an amended complaint.

Thereafter, Beal moved to dismiss the complaint because service of process had not been

perfected. The trial court denied the motions. On interlocutory appeal, we affirmed the

trial court. See Beal v. Blinn, 27A05-0802-CV-78 (Ind. Ct. App. Oct. 23, 2008).

On November 6, 2009, in an effort to settle the suit, Blinn dismissed, without

prejudice, the Law Firm from his suit and continued his action against Beal. However,

settlement negotiations with Beal proved unsuccessful and Blinn moved to reinstate the

Law Firm, to which the Law Firm objected. On February 24, 2010, the trial court denied

Blinn’s motion for reinstatement; we affirmed the trial court’s decision on April 29,

2011. See Blinn v. Law Firm of Johnson, Beaman, Bratch, Beal and White, LLP, 948

N.E.2d 814, 816 (Ind. Ct. App. 2011).

Meanwhile, Blinn also pursued his legal malpractice claim against Kammen and

Kammen’s law firm, asserting professional negligence arising out of Kammen’s

representation in Blinn’s federal criminal prosecution. See Blinn v. Kammen, 27A04-

1008-PL-532 (Ind. Ct. App. June 30, 2011). Kammen moved for summary judgment,

which was granted by the trial court. We affirmed on appeal, concluding:

It appears Blinn’s only specific allegation of malpractice is that Kammen

did not call Beal to testify at the initial hearing regarding whether the

government could introduce Blinn’s proffer statements.

...

But Kammen eventually did put Beal on the stand, and the information

Blinn now asserts was concealed from the criminal court by Kammen’s

ineffective assistance, was in fact not concealed but placed before the court.

...

5

As Blinn did not provide any evidence Kammen’s alleged malpractice was

the proximate cause of the injury Blinn asserts, Kammen was entitled to

summary judgment[.]

Id., slip op. p. 3 (internal citations omitted).

On September 30, 2011, Defendant, Bar Plan Mutual Insurance Co. (Bar Plan),

moved for summary judgment, maintaining that the Law Firm’s insurance policy does

not provide coverage to Beal for the claims asserted by Blinn. On May 4, 2012, Blinn

filed a response, together with a cross-motion on estoppel. On May 18, 2012 and June

11, 2012 respectively, Blinn filed a motion for partial summary judgment and a request

for summary adjudication on estoppel. On July 19, 2012, Beal filed a motion for

summary judgment and motion to strike the testimony of Blinn’s expert witness.

Thereafter, the Bar Plan filed another motion for summary judgment “on the issues of

public policy and [Blinn’s] affirmative defenses.” (Appellant’s App. p. 429). On August

14, 2012, Blinn filed a motion to strike the Bar Plan’s motion and, three days later, also

responded to Beal’s motion to strike.

On March 12, 2013, the trial court conducted a hearing on all pending motions.

On April 12, 2013, the trial court issued its Order on Multiple Matters Heard on March

12, 2013, summarily denying all parties’ respective motions. With regard to Beal’s

motion for summary judgment against Blinn, the trial court noted as follows:

Despite all the facts that that [c]ourt assumes (without deciding) to be

undisputed, the pleadings and Beal’s own memorandum on summary

judgment show the core factual issue that precludes summary judgment for

Beal. As Beal notes, Blinn alleges that Beal failed to advise him “of a

request by federal agents to interview Blinn following his initial proffer

meeting in April 2003 . . . [and] Beal denied the allegations.” That fact had

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little to do with the underlying criminal proceedings; it has everything to do

with Blinn’s claim for relief in this case. Indiana’s policy of preventing

criminal defendants from benefiting from their criminal conduct does not

affect that fact-issue because the criminal conviction resulting from Blinn’s

guilty plea is irrelevant. Instead, what matters is Beal’s conduct because

“the injury in such a situation ‘is not a bungled opportunity for vindication,

but a lost opportunity to minimize [Blinn’s] criminal record.” Accordingly,

because the factual questions on this core issue remain squarely at issue,

Beal’s motion for summary judgment must be denied.

(Appellant’s App. p. 26) (internal references omitted).

Beal now appeals. Additional facts will be provided as necessary.

DISCUSSION AND DECISION

Beal contends that the trial court erred when it concluded that a genuine issue of

material fact exists as to whether Beal’s conduct during the federal investigation into

Blinn’s actions resulted in a harsher sentence than Blinn otherwise might have received.

I. Motion to Strike Expert Testimony

As we cannot review the trial court’s summary judgment unless we establish what

evidence the parties designated for our review, we first address Beal’s contention that the

trial court abused its discretion when it denied his motion to strike Blinn’s expert

testimony because the testimony was “based entirely on speculation.” (Appellant’s Br. p.

25). A trial court has broad discretion in granting or denying a motion to strike expert

testimony. Norfolk S. Ry. Co. v. Estate of Wagers, 833 N.E.2d 93, 100 (Ind. Ct. App.

2005). We reverse a trial court’s decision to admit or exclude evidence only if that

decision is clearly against the logic and effect of the facts and circumstances before the

court. Id. at 101. Further, the trial court’s decision will not be reversed unless prejudicial

error is clearly shown. Id.

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Pursuant to Ind. Evidence Rule 702(a), expert testimony must convey knowledge

that “will assist the trier of fact to understand the evidence or to determine a fact in

issue.” Evid. R. 702(a) assigns to the trial court a gatekeeping function of ensuring that

an expert witness’ testimony both rests on a reliable foundation and is relevant to the task

at hand. Howerton v. Red Ribbon, Inc., 715 N.E.2d 963, 966 (Ind. Ct. App. 1999).

Knowledge admissible under the Rule must connote more than subjective belief or

unsupported speculation. Id. Expert testimony must be supported by appropriate

validation or good grounds based on what is known, establishing a standard of

evidentiary reliability. Lytle v. Ford Motor Co., 696 N.E.2d 465, 472 (Ind. Ct. App.

1998).

Here, Blinn introduced Hammerle, the attorney who negotiated his federal plea

agreement, as his expert witness. Hammerle has been a criminal defense attorney for

more than thirty-five years and is experienced in federal criminal litigation and proffer

sessions. As successor counsel to Kammen and Beal in the underlying representation of

Blinn, Hammerle was familiar with the facts surrounding the case. As such, he based his

opinion on his education, training, and knowledge of the facts of the underlying case and

applicable law.

In the designated testimony, Hammerle testified that during his conversations with

federal agents after he commenced his representation of Blinn, it became clear that Blinn

was offered a misdemeanor charge in exchange for his cooperation with the proffer

session. In his opinion, Beal breached the legal standard of care by not understanding

proffer sessions and unilaterally refusing the Government’s requests for further

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interviews. Hammerle noted that the subsequent admission at trial of Blinn’s statements

uttered during the proffer session made his criminal case indefensible.

Beal now contends that Hammerle’s opinions are based on nothing more than

speculation because of Hammerle’s testimony that “in [thirty]-some years of practice, I

don’t believe I ever had a client in the federal system offered a misdemeanor.”

(Appellant’s App. p. 374). Hammerle’s response follows on the heels of a question about

the “typical or average ordinary sentence for a federal misdemeanor with a guy who’s got

a DUI in his past, a range?” (Appellant’s App. p. 374). Placing Hammerle’s statement in

the proper context, we conclude that Hammerle was touching on the federal sentencing

guidelines, commenting that he typically represents defendants charged with crimes

which warrant a higher sentencing range than a misdemeanor. It does not reflect—as

Beal requests us to find—that Hammerle’s experience is flawed and his opinions are

based on speculation. Therefore, we find that the trial court properly denied Beal’s

motion to strike Hammerle’s expert testimony.

II. Legal Malpractice

A. Standard of Review

Summary judgment is appropriate only when there are no genuine issues of

material fact and the moving party is entitled to a judgment as a matter of law. Ind. Trial

Rule 56(C). A fact is material if its resolution would affect the outcome of the case, and

an issue is genuine if a trier of fact is required to resolve the parties’ differing accounts of

the truth . . . , or if the undisputed facts support conflicting reasonable inferences.

Williams v. Tharp, 914 N.E.2d 756, 761 (Ind. 2009).

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In reviewing a trial court’s ruling on summary judgment, this court stands in the

shoes of the trial court, applying the same standards in deciding whether to affirm or

reverse summary judgment. First Farmers Bank & Trust Co. v. Whorley, 891 N.E.2d

604, 607 (Ind. Ct. App. 2008), trans. denied. Thus, on appeal, we must determine

whether there is a genuine issue of material fact and whether the trial court has correctly

applied the law. Id. at 607-08. In doing so, we consider all of the designated evidence in

the light most favorable to the non-moving party. Id. at 608. The party appealing the

grant of summary judgment has the burden of persuading this court that the trial court’s

ruling was improper. Id. When the defendant is the moving party, the defendant must

show that the undisputed facts negate at least one element of the plaintiff’s cause of

action or that the defendant has a factually unchallenged affirmative defense that bars the

plaintiff’s claim. Id. Accordingly, the grant of summary judgment must be reversed if

the record discloses an incorrect application of the law to the facts. Id.

We observe that, in the present case, the trial court did not enter findings of fact in

support of its judgment. Special findings are not required in summary judgment

proceedings and are not binding on appeal. Id. However, such findings offer this court

valuable insight into the trial court’s rationale for its decision and facilitate appellate

review. Id.

B. Analysis

Beal’s main argument focuses on Indiana’s public policy which bars a person

convicted of a crime from imposing liability on others through a civil action for the

results of his or her own criminal conduct. Because Blinn entered into a voluntary plea

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agreement and accepted responsibility for his criminal conduct, he cannot now “seek to

profit from [his] own criminality.” (Appellant’s Br. p. 17). Specifically, Beal maintains

that Blinn’s sentencing and fine arose from his admitted guilt and he cannot now redirect

that causation on Beal in order to recover for the results of that sentencing.

Consequently, Beal concludes that “[w]hether or not [Beal] informed Blinn ‘of a request

by federal agents to interview Blinn’ [] is irrelevant []” as Indiana public policy does not

permit Blinn’s lawsuit to recover the profits of his criminal activity. (Appellant’s Br. p.

21).

To prove a legal malpractice claim, the plaintiff-client must show: (1)

employment of the attorney (the duty); (2) failure of the attorney to exercise ordinary

skill and knowledge (the breach); (3) proximate cause (causation); and (4) loss to the

plaintiff (damages). Sleweon v. Burke, Murphy, Constanza & Cuppy, 712 N.E.2d 517,

520 (Ind. Ct. App. 1999), trans. denied. To establish causation and the extent of harm in

a legal malpractice case, the client must show that the outcome of the underlying

litigation would have been more favorable but for the attorney’s negligence. Id.

In support of his argument, Beal references Rimert v. Mortell, 680 N.E.2d 867

(Ind. Ct. App. 1997), trans. denied, Indiana’s seminal case with respect to professional

malpractice and Indiana’s public policy for recovery of damages resulting from a

criminal act. In Rimert, a patient with a psychiatric illness filed a medical malpractice

action against his psychiatrist, claiming his psychiatrist negligently discharged him from

the hospital, after the patient was charged with four counts of murder and found guilty

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but mentally ill. Id. at 869. The physician settled the patient’s claim, and the patient

filed a petition for payment of damages from the Patient’s Compensation Fund. Id.

Rejecting Rimert’s claim, we concluded that

the rule against actions based upon or involving a plaintiff’s criminal act is

correlative with Indiana’s public policy against permitting one to profit

from his or her wrongdoing. Each embodies the principle that one who is

responsible for the commission of a criminal or wrongful act must

exclusively bear his or her share of the responsibility for the act, and may

not evade that responsibility either through gaining some profit for the act

or shifting liability for the act to another. We therefore hold it to be the

public policy of this state that an individual who has been convicted of a

crime should be precluded from imposing liability upon others, through a

civil action, for the results of his or her own criminal conduct.

Consequently, a person may not maintain an action if, in order to establish

the cause of action, he or she must rely, in whole or in part, upon an illegal

act or transaction to which he or she is a party or upon a violation by him or

herself of the criminal laws.

Id. at 874.

The case at bar can be differentiated from Rimert and its progeny. Blinn is not

relying on his own criminal conduct in an attempt to shift responsibility for the resulting

damages to another party. Rather, Blinn seeks damages for Beal’s own behavior in

failing to represent him appropriately. Beal represented Blinn in a federal criminal

action, despite Beal’s limited experience with federal litigation, his unfamiliarity with the

legal construction of a federal proffer session, its purpose and its consequences, and his

failure to convey a request for further interviews as part of the proffer session to Blinn.

Designated evidence reflects that a completed proffer session might have resulted in a

reduced sentence. As such, there is a genuine issue of material fact whether Beal’s

conduct resulted in a harsher sentence and even jail time for Blinn. To be sure, Blinn is

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not maintaining that Beal caused or contributed to the commission of the crime; instead,

Blinn is seeking to impose liability on Beal for Beal’s own subsequent conduct during the

federal investigation.

Pursuant to Beal’s theory, a criminal defendant, once convicted, can never pursue

a legal malpractice claim against his attorney because he committed a crime, regardless

of the quality of his attorney’s representation. Underlying his argument is the theme that

a guilty person has not been harmed by a conviction and thus should not be able to sue

his or her lawyer as a result of a conviction, regardless of whether the person, although

guilty, would have been acquitted or should have received a lesser sentence. However, as

a practical matter, there can be no doubt that if a criminal defense lawyer’s negligence

causes a client to be wrongly convicted and imprisoned, the client is harmed on the first

day of imprisonment, if not before. In criminal as well as in civil cases, there is no

necessary and direct link between not prevailing in a case and the existence of a claim for

legal malpractice. A prevailing party can be harmed by a lawyer’s negligence, just as a

party can lose even though the lawyer did not commit malpractice. An innocent person

can be convicted even with adequate representation, and a guilty person’s conviction can

be actionable because a lawyer’s negligence failed to protect the rights that even a guilty

person has. Stevens v. Bispham, 851 P.2d 556, 574 (Ore. 1993) (Unis., J., concurring).

Likewise, the fact that a criminal defendant has been exonerated of the criminal offense

through reversal on direct appeal or otherwise does not mean that the criminal

defendant’s lawyer was negligent; nor does the fact that a person is acquitted at trial

mean that his or her counsel was not negligent. See id. at 575. In other words, the

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determination that, based on the evidence and argument at trial, a criminal defendant is

proven guilty beyond a reasonable doubt is not the same as the issue of whether the

lawyer’s negligent representation contributed to or caused the resulting conviction.

Beal’s argument, however, allows criminal defense attorneys to hide behind their own

negligence by asserting the client’s conviction—albeit caused by the lawyer’s

negligence—as a defense to a claim of legal malpractice. In contrast, lawyers whose

clients do not prevail in civil matters do not have the ability to assert to their clients,

“You lost, therefore, I was not negligent.” See id. The public not only has an interest in

encouraging the representation of criminal defendants, but it also has an interest in

making sure that the representation is, at the very least, not negligent.

Our decision today is in line with Indiana’s current case law, which allows a

criminal defendant to institute a legal malpractice claim against his or her attorney. See

Godby v. Whitehead, 837 N.E.2d 146 (Ind. Ct. App. 2005), trans. denied; Silvers v.

Brodeur, 682 N.E.2d 811 (Ind. Ct. App. 1997); Adams v. Traylor-Wolff, 2013 WL

5701056, (N.D. Ind., Oct. 18, 2013). In fact, the criminal defendant need not even

establish his innocence to proceed with a legal malpractice case against his counsel. See

Godby, 837 N.E.2d at 151; Silvers, 682 N.E.2d at 818. Because there is a genuine issue

of material fact whether Blinn’s charged crime and sentence would have been more

favorable but for Beal’s actions during his representation of Blinn, we affirm the denial

of Beal’s motion for summary judgment. See Sleweon, 712 N.E.2d at 520.2

2

In a related argument, Beal asserts that “[t]hat Blinn’s claim is barred under Indiana law owing to a lack

of proximate cause was already held to be true as to attorney Kammen[.]” (Appellant’s Br. p. 22).

14

CONCLUSION

Based on the foregoing, we conclude that the trial court properly denied Beal’s (1)

motion to strike and (2) motion for summary judgment.

Affirmed.

VAIDIK, C. J. and MAY, J. concur

However, we note that in Blinn v. Kammen, 27A04-1008-PL-532 (Ind. Ct. App. June 30, 2011),

Kammen’s alleged legal malpractrice was that he failed to “call Beal to testify at the initial hearing

regarding whether the [G]overnment could introduce Blinn’s proffer statements.” Id., slip op. at p. 2.

With respect to this perceived act of legal malpractice, we concluded that because Kammen did ultimately

put Beal on the stand, Kammen’s action could not be considered the proximate cause of Blinn’s injury.

See id., slip op. at p. 3. The Kammen court did not evaluate Beal’s action with respect to Blinn’s injury.

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