Appendix — Bergmann v. Lee Data Corp.
Supreme Court brief1994
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Supreme Court, U.
FILED “s
931919 may 25 1994
————OEEICE DE THE Cure
LJ
No.
In the
Supreme Court Of The Anited States
October Term 1993
DARYL J. BERGMANN,
Petitioner,
Vv.
LEE DATA CORPORATION, a Minnesota corp.,
now known as Apertus Technologies, Inc.,
ROBERT GORDON, SARAH MacRAE, GARY WHITE,
ROBERT BESINGER and BRIAN KOVALCHUK;
Respondents.
Petition For Review Of Decision Of Court
Of Appeals To The Supreme Court
For The State Of Minnesota
PETITIONER'S APPENDIX
Volume I of I
Daryl J. Bergmann, Pro Se
5025 West 102nd Street
Bloomington, MN 55437
(612) 896-0065
(612) 546-3655
Attorney for Petitioner
a henememnannel
PUBLISHER'S NOTE:
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TABLE OF CONTENTS TO APPENDIX
Page
I oe eS Ai occnsecnedaapentanase snatakaaabnaneanuansenn i
TABLE OF CONTENT ...............cscccssssssssosscocscessressesesscssseees ii
TABLE OF AUTHORITIEG..............:sccscssessscsessesnresessresseeees Vv
OPINIONS SOUGHT TO BE REVIEWED .................::::::200++ l
Minnesota Supreme Court
Order Dated February 24, 1994 ..........ccccseeseseeeseeeeesteeseeseees l
Minnesota Court Of Appeals
Decision Filed December 21, 1993................cccceeeeeeeeeeeeeeeees 2
Order Filed September 1, 1992. ...........ccccseseseseeeeseeseesenneees 5
Minnesota District Court, 4th Dist.
Order and Memorandum
Dated April 1, 1993 ..........:cccsesssseeeseeeenssesssseseeseneneeenecens 7
OTHER OPINIONS IN THE CASE ....0.......:cccceeeeeeeeeseeeeeeees 23
Minnesota Court Of Appeals
Order Filed August 19, 1993 ...........:.ccccccsesesseseesereseseeseneees 23
Order Filed September 25, 1992 ............::cscesssseeeeseeseereeteens 25
Minnesota District Court, 4th Dist.
Amended Order
Filed July 14, 1992...........ccccsessscseseeseseneeseneeeesseeeecnereeneney 27
Order and Memorandum
Dated March 27, 1992...............cccsssscscscssssrrcscssssesesssccsnnes 29
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TABLE OF CONTENTS TO APPENDIX
Page
REFERENCED STATUTES AND PROVISIONS ............... 427
Minnesota Rules Of Civil Procedure ...................cccccccccceeeee 42
I ie a a allel 42
SC One © ere p 42
MS tke aE ae oe 43
I Dae 44
_ Ee eee rr 44
_ 8 EE MRR Fe a 45
gg: See Poe COS 45
Minnesota General Rules Of Practice For District Courts 46
SE I RAND os covccitissslacnanbasctbéaitinabiaiaSin dh ctdeesasies 46
on, RE SS ke ae 46
Minnesota Rules Of Civil Appellate Procedure.................. 46
Nee ne 3c cacbsaceschenasedanen 46
RT teeth ee oh ets 46
Ee SNORE ee ee STL 8 47
_ << | een: .iere a 47
| RA See er ee 47
ERR RR AR eRe ee nena Eee 48
SL, REE ROTES See eT eee emg nS,» 48
Minnesota Statutes Sections .....00...0..........ccccccceccceecceeseceeeeee 49
BT BN GS 0c cccecccccsscaczsasesoareccecrescocasane 49
i, SR NE II ii ok ais ee cavcssacciccdeccsatibelen educa: 49
2, aT LE LT Ae te 50
a | eee ute 50
iii
TABLE OF CONTENTS TO APPENDIX
Page
EXCERPTS OF MEMORANDA PURSUANT
Fr Rig Ne BND acai iia caccenitacetiea eddie Actasibbaease 51
Petitioner's Memorandum
Dated Oct. 29, 1993
I a siitiidiaiec cba cticsscwnsvtasesanciaassvescbcmamdddchanmehtil 51
Petitioner's Memorandum
Dated Oct. 25, 1993
i 1 capalansssabiebiicoaaeeinil 53
Petitioner's Reply Memorandum
Dated Nov. 4, 1993
REF Ceara aE Ree ee mre Dc 56
Petitioner's Reply Brief
Dated Oct. 12, 1993
I EE ici diia satdsankiaonhinisndetnennsacedioieetbasibaakdcaaabeal 58
8 See tse Rear? Re) ae 72
Petitioner's Appellate Brief
Dated Aug. 30, 1993
ica cckicteinnsnnsguuashtibiasthciucseesteskoliaaas 73
Petitioner's Memorandum And Affidavit
Dated Nov. 19, 1992
8 RARE meme SIF SNe Mme TA os 76
RNAI ae rete to eatr Sen eater een onli tA 83
$2 ale eee x
Se ay et eee Sete eee ee ee
Pe Ania a ct
APPENDIX
TABLE OF AUTHORITIES
Case Page
Albert v. Edgewater Beach Bldg Corp.
218 Minn. 20
Rae EE OOD csc isssersdonidasceaseasndgicnabincon dt egnavetecasline 75
Altomare v. Altomare
513 A.2d 486
ee E iarisissiccensincssconsnidpsitctennduthalakedansa 60
Alvarado-Morales v. Digital Equipment Corp.
SGA Fe Ot, OE Cle CO, TOG occinsscccceicis oeiccidsasicicsibeis. 21
Atwood v. Holmes
229 Minn. 37
Fe SEE vi sescccnsnsecoosnscncnscixadtensbebictocsidoceiatabintiale 59
Austin Farm Center, Inc. v. Austin Grain Co.
418 N.W.2d 181, 184
GE ihc oicscsscncinesncscsiscsdconsesnnecs 14, 35, 37, 64, 71
Bartholet v. Berkness
291 Minn. 123
et Ne EE RN em Toe rT 62
Bauman v. Metzger
145 Minn. 133
RPMI TIITT RIOD cc ccnscnvscoscdacédcocdacliheiidddebiathdosaaeccbaial 59
Beach v. Anderson
417 N.W.2d 709
GRR, BOIOD eiitciieccciceniesivesasesnnsisesersnsbubiabelandiciicaiod 64, 69
APPENDIX
TABLE OF AUTHORITIES
Case Page
Becker v. Messner
175 Minn. 471
FE Bes TA CI ccc ecenescocecssccccssaseiseanelicmaincelaeiicaliied 75
Bergmann v. Hanson
CT-91-12540
Cas CLIT IEE D nc ncsscncnavenecdcnccssnbendoseiocdelehaniiilaalel 77, 87
Bergstrom v. Sears, Roebuck Co.
532 F.Supp. 923, 933
srs siciliniisesens 3, 11, 13, 15, 38, 40, 63, 64
Borchardt v. Kulick
234 Minn. 308, 320-21
48 N.W.2d 318, 326
Ge iniicnccirescidthad Sabi tecbsndbstisbidinclcctdbseall 3, 60, 61, 62, 65
Bruder v. Wolpert
178 Minn. 330
rE sihsieseescsoseereensvenesatistensnceniccshdnibaiaaanielaaen 60
Chicago M.&St.Paul Ry. v. Sprague
140 Minn. |
es I REP OID ocacevstccnssnscenensessnsnessessliiiasbulijetetalail 58
Chiynadia v. Smiley's Pt. Clinic
428 N.W.2d 459
ci csccceiccenesensnsessescsessseces<ndbisapeiuaiiiobinsiaele 57
Christianson v. Hager
242 Minn. 41
OU en AF WT INOD dccsisbncnctittnssnsteedehapcctnentindiidiaieeliastiil 58, 62
Se ee ee ee ae ee
ae ee ee
a
APPENDIX
TABLE OF AUTHORITIES
Case Page
Clark v. Crossroad Center, Inc.
285 Minn. 173
I ek ee 70
Cohen V. Mirviss Mfg. Co.
173 Minn. 100
MN 58 2 Me LAS Dae 95
Dataserve Equip. Inc. v. Tech. Fin. Leasing Corp.
ati adetiaihaachaitiniristiniisiantasasiic db lbccabtincbaosiiases 70
Ecklund v. Vincent Brass and Aluminum Co.
351 N.W.2d 371
i annie dceceuliccennicpdbadicuadiathlsie 67
Fulgence v. J.Ray McDermatt & Co.
I eemeeltialiabiioiiiaadll 64
Ghostley v. Hetland
Ea eT Sa ge 54
Greer v. Koviker
EE I ic ee Le Ome ae eT 69
Hagedorn v. Aid Ass'n. for Lutherans
211 N.W.2d 154, 157
a 12, 13
Hart v. Bell
222 Minn. 69
23 N.W.2d 375
ene eS 59, 60
Vii
APPENDIX
TABLE OF AUTHORITIES
Case Page
Hillmeyer v. Watz
SO EI sasccncnccnsscntrasesconsrenssitnaiosdiinsovaliddesssintialelients 64
Holen v. Mpls. St. Paul Metro. Arprts. Comms.
250 Minn. 130
Fe BU ED cnntinssntinadnntasiiveckinsnienthsetiteimbssbtidincsthiedhiald 58
Hornblower & Weeks-Hemphill Noyes v. Lazere
ee I iat acilendh sandihinnsnnsaantsoratesvasesilecaticbismandethoule 40
In re AW's Welfare
399 N.W.2d 223
IDL BUMP D pcs cosnsstencaanenssnsasonsaankdaditicnssisscbsnediiai 95
In re R.L.W.
309 Minn. 489
SI Is culn eel nialandeuneainoninnaibenes 95
Jallen v. Agre
BT wiittrccsiscinansiiinoleecinasionincsisssaqeenbiuandsnedelpihtiitn 64, 75
Johnson v. Froelich
196 Minn. 81
NE A ID ic hechie Suc ssc sates acniinaiaadieaieniegnledioanel 95
Johnson v. St. Paul Ins. Cos.
ATEN HEME SN nd CUE: 33
(Minn 1981)
Johnson v. Situnann
TR ARNT ae 15, 36, 64
APPENDIX
TABLE OF AUTHORITIES
Case Page
Keller v. Wolf
239 Minn. 397
PT REPO PD Ssssicccsssnsesetsssvcatebiverctescaviectcédetestecdds 75
Kittler & Hedelson v. Sheehan Prpts. Inc.
295 Minn. 232
EF ED REP TUD cstv ssctiiscencsciaicescnisidiserssiveatindecnsttia 94
Kuykendall v. Rockwell Intl. Corp.
20 Empl.Prac.Dec. 30
NE MM Boi pciicecivviitivecareenbetevtecncevBenbtadeowetics 67
Lally v. Crookston Lumber Co.
85 Minn. 257
iii i eiieytivevlinivinbuteiinerenecsdeinivertisies 65
Laserage Technologies Corp. v.
Laserage Laboratories, Ind.
972 F.2d 799
i a emwnnaiiinmietniniouniin oavpiirilia 60
Martindell v. Intl. Tel. & Telg. Corp.
594 F.2d 291
EE REE Die an a ST 95
McDonald v. Johnson & Johnson
722 F.2d 1370 (8th Cir. 1983)
cert. denied 469 U.S. 870 (1984) 00.0... ceceeeeeeees 69
McGee v. Breezy Pt. Est.
283 Minn. 10, 22
I I a cisceacssernninnsinnmrvbveninnceciseevemess 2, 12
APPENDIX
TABLE OF AUTHORITIES
Case Page
Meisner v. Meisner
220 Minn. 559
PE EE CRO snistnassenesscsssatsvenstcadaticndenelsidetboniatcsl 74
Merle's Costr. Co. v. Berg
442 N.W.2d 472
GI FUIU Doves ccssarnsoncnisanmssinnekpesitoledeicilathuddinads vesie 57
Mill Pond Towers, Inc. v State Dept.Nat.Rsrcs.
406 N.W.2d 2
ID sciisinniiinisnsccsisinaccadbastsckalsscnipicacdabanccsuck 59
Minn. St. Bar Assc. v. Divorce Asst. Assc.
I MD pecisncisciscenastdacomieeccceosnieaseseslacnactabtbel 95
Mullin v. Minkel
177 Minn. 42
Be Re I CIN aincssn cscs ccnescetakesdiieun Masbcceisndtshdinds dad Sokal 75
Myers v. Feckler Co.
312 Minn. 469, 474
REF OE IT CAS OD iviiienjeien ven shen enkionins Last beaddntcserstaate 2
Northwestern Natl. Bk. Swst. v. Lectro Systems, Inc.
262 N.W.2d 678
I ai acs Sis wean Roa nc hn nddn saaiadad 59
Nybladh v. Peoples State Bank
247 Minn. 88
Pe ION vsscsisscinsnessrsnsssesttilbodincttatetieatiotts 75
net pene as Oat Doane i ols oP 8 tl OP OO Mow
APPENDIX
TABLE OF AUTHORITIES
Case
Pow-Bel Const. Corp. v. Gondels
291 Minn. 386
Pm OWT Me ES GIDTR) vgicescisssssnssesssesoisccsciie
Roaderick v. Lull Engr'g. Co.
296 Minn. 385
NIE BL dacivcavitescrcirsovstsaisasincrseiecss
Rooney v. South Sioux City
111 Neb. 1
NN ii tip ccisssisiasinnssabasiléas
Rosenberg v. Townsend, Rosenberg & Young
376 N.W.2d 434
GI: BOO Dione cass ccksaastdsnscccssciecosinse
Rural American Bank v. Herickhoff
473 N.W.2d 361
CECA RES
Ryan v. Ryan
II Sisiihiicsasks cexssenisvsaesansesnactscnentents
Safeco ins. Co. v. Diaz
385 N.W.2d 845
I, CO i eiciscssacasecsinsscnsvsessiosiascicse
Schumann v. Northtown Ins. Agency, Inc.
452 N.W.2d 482, 484
CRAPO, TODD isis cicdcccisscccsccsscssssciecicsss
Page
APPENDIX
TABLE OF AUTHORITIES
Case Page
Semrad v. Edina Realty, Inc.
470 N.W.2d 135, 144
P| Ne Ss ae ty yee 12
Skalbeck v. Agristor Leasing
384 N.W.2d 209, 213
I Biss ssseorisedsdaninsancrsisénagienndensalnel 36, 38, 65
Spicer v. Carefree Vacations, Inc.
370 N.W.2d 424, 425
SINR ED iilihipis tiasssaneosenrenrdocssendaadnnnssateabiadansieael 6
State v. Bucholz
169 Minn. 226
EE SOURED 1.1. ssnaiatonansanesahiieebibianseidisaias 75
Stockdale Bancorp. v. Kjellberg
479 N.W.2d 438
I BD viesiascisessipsisssinisiconmenaihaiiaaalal 5
Swift and Co. v. United Packing House Workers
228 Minn. 571
EE CRD he reeucseiasarsasicsiiinacsiosrenuaplabebiimaiaanill 95
Theis v. Theis
RII TE wicescisasosseeseseursconsshéumespreangalasiiea a 64
Tomson v. Stephan
696 R.Supp. 1407
I disttSeiiccnsccccsscsnsesacjoreseccannileliiidesduteleinaaal 67
xii
APPENDIX
TABLE OF AUTHORITIES
Case
Tonka Tours, Inc. v. Chadima
372 N.W.2d 723, 727
NN daar alcileasecsccnscoagscasesiecescsesacessesesesd.
True Share Sys. v. Schmidt
397 N.W.2d 483
(Minn.Ct.Appls. 1986) ...........scccccccsssccesccssssssssssssscecce
U.S. v. Rylander
ee
Upton Mill & Elevator Co. v. Baldwin Flour Mills
147 Minn. 205
i craiicipincscsecvevsuussedestwovne
\Wilson' Inc. v. Twin City Freight Inc.
378 N.W.2d 117
ac peccsustinpimrcssievevvnvnvons
Wise v. Midtown Motors
231 Minn. 46
EE
Wodd v. Bary
179 Minn. 208
coisa tcicrsnsaiesevevsovinnasnevaseecers
Worwa v. Solz Enterprises, Inc.
Be I, BO CF iv covcsccescivevesssecsesscsescoseses
xiii
APPENDIX
TABLE OF AUTHORITIES
Reference Page
Am.Jur. 2d, Agency
Be HI eis sceiinnsnsosccacororsessvcansdplccoaboleal 12, 39, 60
Dunnell's Minn. Dig., 4th Ed.
SN he es PRA c cian scclaslepngtesliestinseieticeumclaeas 58
Dunnell's Minn. Dig., 2d Series,
ee etn ich ati iran satin siaponissadhahaubvesspusiecadacaiaibanie 65
xiv
OPINIONS SOUGHT TO BE REVIEWED
STATE OF MINNESOTA
IN SUPREME COURT
C8-93-1526
Filed February 24, 1994
Daryl Bergmann, Appellant
vs.
Lee Data Corporation, et al, Respondent, Sarah A. MacRae,
Respondent.
ORDER
Based upon all the files, records and proceedings herein,
IT IS HEREBY ORDERED that the petition of Daryl J.
Bergmann for further review be, and the same is, denied.
Dated: February 24, 1994
BY THE COURT:
AM Keith
(Signed)
Ch:cf Justice
STATE OF MINNESOTA
IN COURT OF APPEALS
C8-93-1526
Filed December 21, 1993
Daryl Bergmann, Appellant,
VS.
Lee Data Corporation, et al, Respondent, Sarah A. MacRae,
Respondent.
Considered and decided by Kalitowski, Presiding Judge,
Randall, Judge, and Davies, Judge.
UNPUBLISHED OPINION
KALITOWSKI, Judge
Appellant contends the district court erred in enforcing a
settlement agreement against him. We disagree and affirm.
DECISION
Appellant contends the district court erred in enforcing a
settlement agreement against him. The decision to vacate a
settlement stipulation rests largely within the district court's
discretion and will not be reversed unless “the court acted in
such an arbitrary manner as to frustrate justice." Myers v.
Fecker Co., 312 Minn. 469, 474; 252 N.W.2d 595, 599 (1977).
First, appellant contends his counsel had neither apparent
nor express authority to settle this case. We «lisagree.
The conduct of appellant's counsel during settlement
negotiations resulted in apparent authority. See McGee v.
2
Breezy Point Estates, 283 Minn. 10, 22; 166 N.W. 2d 81,
89 (1969). Because respondents were justified in assuming
appellant's counsel had authority to settle, appellant will not
be permitted to prove his counsel's authority was, in fact,
less extensive. See Bergstrom v. Sears, Roebuck and Co., 532
F.Supp. 923, 933 (D.Minn. 1982).
We further conclude that appellant's counsel had express
authority to settle this matter. The district court's
determination that appellant admitted his counse: had
“complete control over the litigation: and his counsel averred
that appellant had expressly authorized the settlement and
dismissal of the lawsuit, are findings of fact supported by the
evidence. See Austin Farm Center, Inc. v. Austin Grain
Co., 418 N.W.2d 181, 184 (Minn.App. 1988).
Second, appellant contends the parties never entered into a
binding contract. We disagree. The <:strict court's
determination that appellant accepted the conitract will not
be overturned unless clearly erroneous. See Tonka Tours,
Inc. v. Chadima, 372 N.W.2d 723, 727 (Minn. 1985).
Appellant argues that he did not sign the settlementand his
counsel's signature did not constitute acceptance. Because we
found that appellant's counsel had authority to settle, we
conclude the district court did not err in rejecting appellant's
argument.
Third, appellant contends for the first time on appeal that the
statute of frauds precludes enforcement of the settlement
agreement. We disagree. Because the statute of frauds is
an affirmative defense which is waived if not raised, we need
not consider it. See Borchardt v. Kulick, 234 Minn. 308, 320-
21; 48 N.W.2d 318, 326 (1951). Even if we address the
merits, we conclude that the signature of appellaat's
counsel on the written settlement agreement satisfied the
statute of frauds. See Minn. Stat. S 513.01 (1992); Minn. Stat.
S 336.8-319 (1992).
3
Fourth, appellant asserts that respondents’ counsel, his
own counsel, and the district court committed misconduct
and that, as a result, the settlement agreement should be
set aside. We disagree. Because appellant cannot substantiate
his assertions, we conclude that the district court properly
rejected appellant's allegations. Appellant has moved to strike
portions of respondents’ brief that he contends are not part of
the record on appeal. We grant appellant's motion with respect
to the deposition transcripts contained in respondents’
appendix. We deny appellant's motion in all other respects.
Affirmed. Thomas Kalitowski
(Signed)
12-13-93
STATE OF MINNESOTA
IN COURT OF APPEALS
C1-92-1292
Filed September 1, 1992
Daryl Bergmann, Appellant,
vs.
Lee Data Corporation, et al, Respondent, Sarah A. MacRae,
Respondent.
ORDER
Considered and decided by Wozniak, Chief J., Lansing, J., and
Amundson, J.
BASED UPON THE FILE, RECORD AND PROCEEDINGS
HEREIN, AND FOR THE FOLLOWING REASONS:
This appeal was taken from an April 16, 1992 judgment
entered on the denial of a motion to vacate a prior judgment.
Respondents move to dismiss.
The pretrial discovery sanction orders challenged by appellant
would have been reviewable on appeal from the final
judgment. Stockdale Bancorp. _v. Kjellberg, 479 N.W.2d
438 (Minn.App. 1992). Because the orders were issued prior
to entry of the judgment of dismissal, and the time to
appeal from that judgment has expired, they are no longer
appealable. Minn.R.Civ.App.P. 104.02.
The April 16, 1992 judgment denying appellant's motion
to vacate is independently appeaiable, because the issues
raised in the motion would not have appeared in the record
leading to entry of the October 1991 judgment of dismissal
and the issues could not have been raised on a direct appeal
5
a Sy
from that judgment. See Spicer _v. Carefree Vacations,
Inc., 370 N.W.2d 424, 425 (Minn. 1985). However, the
issues presented in the motion are still pending in the trial
court, which has indicated it will reconsider the matter. In the
interests of judicial economy, review should await the
outcome of that reconsideration.
IT IS HEREBY ORDERED:
1. Respondents’ motion to dismiss is granted in part.
2. Appellant's attempted challenge to orders issued prior to
the October 1991 judgment of dismissal is dismissed.
3. The portion of the appeal relating to issues presented and
decided in the motion and order to vacate the judgment of
dismissal is dismissed, without prejudice to the appellant's
right to perfect a timely new appeal from the order or
judgment resulting from the pending proceedings to
reconsider. On any such appeal, the April 16, 1992
judgment shall be within our scope of review, and appellant's
statement of the case shall cite this order as the
jurisdictional basis for review of that judgment.
Dated: August 31, 1992
BY THE COURT
Ch.J. Wozniak
(Signed)
Bhan ete
STATE OF MINNESOTA DISTRICT COURT
COUNTY OF HENNEPIN FOURTH JUD. DIST
MC 89-12254
Dated April 1, 1993
Daryl J. Bergmann, Plaintiff,
vs.
Lee Data Corporation, et al, Defendants.
ORDER AND MEMORANDUM
The above entitled matter came before the Hon. Kevin S.
Burke, Chief Judge of District Court, pursuant to an order
dated July 14, 1992, in which this court granted reconsideration
on defendant's motion to enforce the purported settlement
agreement between the parties.
While reconsideration of defendant's motion to enforce was
pending before this court, several other motions were made by
the parties. First, plaintiff made two separate motions to
supplement the record with a statement of proceedings
from April 17, 1991, and a statement of proceedings from
January 14, 1992, pursuant to Minn.R.Civ.App.P. 110.03.
Second, defendants filed objections to the statements of
proceedings from April 17, 1991, and January 14, 1992.
Lastly, defendants moved the court to strike plaintiff's
Memorandum of Facts and Law (dated August 4, 1992),
and Affidavit of Daryl J. Bergmann (dated August 3,
1992), pursuant to Minn.R.Civ.P. 12.06.
The court continued to receive correspondence pertaining
to this case up until the end of November 1992, when the
record was finally closed.
Plaintiff submitted materials to this court pro se. Roy
Ginsburg, Esq. and Karen Maki, Esq. submitted materials on
behalf of the defendants Lee Data Corporation (now
known as Apertus Technologies), Robert Gordon, gary
White, Robert Besinger, and Brian D. Kovalchuk. Defendant
Sarah A. MacRae is represented by the law firm of Chrastil
and Steinberg, and joined in the submissions made on
behalf of the other defendants.
Based upon the files and records herein, the court makes the
following:
ORDER
1. Defendants’ motion to enforce the settlement agreement is
GRANTED.
2. Defendants’ motion to strike from the record plaintiff's
Memorandum of Facts and Law (dated August 4, 1992),
and affidavit of Daryl J. Bergmann (dated August 3,
1992) is DENIED.
3. Plaintiffs motions to supplement the record, with
statement of proceedings from April 17, 1992, and
January 14, 1992, are DENIED.
4. Theattached memorandum is hereby incorporated and
made a part of this order.
LET JUDGMENT BE ENTERED ACCORDINGLY.
Dated: April 1, 1993 BY THE COURT:
Kevin S. Burke
(Signed)
MEMORANDUM
April 1, 1992
Background
This case is once again before this court for determination
of the validity of a purported settlement agreement between
the parties pursuant to this court's Order dated July 14,
1992. Reconsideration of the validity of the settlement
agreement is the next step in this long and complex lawsuit. At
this time, the court finds it unnecessary to cover old ground
by detailing the complete history of this dispute. (Ftnt.
See, this court's Order and Memorandum dated March 27,
1992, for a full procedural and factual history of this case.)
Currently what is relevant are the questions detailed in the
Order of this court dated July 14, 1992, when both parties
were requested to submit affidavits and memoranda of law
on the following issues:
1) whether plaintiff paid Judge Sommerville's court
ordered sanctions,
2) whether plaintiff paid $1000 in court ordered
sanctions,
3) whether plaintiff was required to pay sanctions before
completion of his discovery, and
4) the legal effect of the settlement agreement having
a line _ requiring plaintiff's signature.
With these issues in mind, the court will first determine
whether the alleged settlement agreement between the parties is
valid and then discuss the other motions of the parties.
Analysis
I. Motion to Enforce Settlement Agreement
Plaintiff raises a myriad of reasons why the _ purported
settlement agreement should not be enforce by this court.
besides claiming that his attorney did not have express or
apparent authority to enter into any settlement agreement,
9
plaintiff argues that he personally did not enter knowingly and
voluntarily into the settlement agreement, that his signature
was expressly required on the settlement agreement and finally
that no contract was formed between the parties.
A. Express Authority
All of plaintiffs arguments for not enforcing the settlement
agreement belie the fact that, as acknowledged in prg. 12 of
plaintiffs Affidavit of August 3, 1992, Alan Greenberg
("Greenberg"), as plaintiff's attomey for more than two years
in this matter, had at some point "complete control over the
litigation." This court, as trier of fact, previously determined
that Greenberg's testimony was more credible on the issue
of express authority to settle this case than that of the
plaintiff. Order of March 27, 1992, page 6. No evidentiary
submission on the motion to reconsider has changed the
court's view that Greenberg had express authority to settle
any claim on behalf of the plaintiff at the time the
settlement agreement was made. Thus, _ the settlement
agreement between the parties to this case should be given its
full effect since Greenberg had the express authority of
ettlement by the plaintiff.
B Apparent Authority
This court has also previously ruled that Greenberg had
apparent authority to negotiate all terms of the settlement
agreement and plaintiff did nothing to terminate that authority.
Plaintiff now asserts that Mr. Greenberg's apparent authority
was less extensive than full settlement authority. See Letter
from Daryl Bergmann to Hon. Kevin Burke dated May 26,
1992.
All of the terms of the settlemei.t agreement were negotiated
in the same context, Greenberg dealing with the defendants’
attorneys without personal involvement by the plaintiff, yet
10
plaintiff asks that this court find that defendant's reliance on
Greenberg authority was reasonable as to some terms but not
as to others. Defendants contend that plaintiff is estopped
from asserting that Greenberg's authority was less _ extensive
than plaintiff led defendants to believe, citing Bergstrom v.
Sears Roebuck & Co., 532 F.Supp. 923 (D.Minn. 1982). This
court agrees with defendants.
Plaintiff references the "agreement form" between the
parties which states that it is governed by Minnesota law.
He asserts that since Bergstrom and related cases cited by
defendants are federal cases and not “Minnesota law", they
are not applicable in_ the interpretation of the agreement.
While it is true that Bergstrom is a federal case based on
the federal rules, plaintiffs claim is without merit.
First, this court explicitly recognized in its Memorandum of
March 27, 1992, that "Bergstrom was a case in federal court,
and has not yet been cited by any Minnesota state appellate
court. This court, however, finds the reasoning persuasive.
Minnesota state appellate courts have recognized the doctrine
of apparent authority." (emphasis added) (citation omitted)
See Memorandum of March 27, 1992, at 11.
Second, plaintiff's claim might have some validity if the
principles announced in Bergsirom were inconsistent with
Minnesota law. However, they are not. Although the
Bergstrom court cites Am.Jur. as authority, the principles
cited by the court are reflected almost precisely in Minnesota
case law. The Bergstrom court stated:
"Where a principal has, by his voluntary act, placed an agent in
such a situation that a person of ordinary prudence
conversant with business usages and the nature of the
particular business is justified in assuming that such agent
has authority to perform a particular act and deals with the
11
ches
Supt tid
aw nan ade eae Pe ye ay
PE ey LO eT ee
agent on that assumption, the principal is estopped as against
such third person from denying the agent's authority; he will
not be permitted to prove that the agent's authority was, in fact,
less extensive than that with which he was apparently clothed.”
Bergstrom, 532 F.Supp. at 933 (quoting 3 Am.Jur. 2d Agency S
76 (1962)).
The Minnesota Supreme Court has adopted the Restatement
(Second) of Agency S 27 definition of apparent authority:
"Apparent authority to do an act is created as to a third
person by written or spoken words or any other conduct of the
principal which, reasonably interpreted, causes the third
person to believe that the principal consents to have the act
done on his behalf by the person purporting to act for him"
Semrad_v. Edina Realty, Inc, 470 N.W.2d 135, 144
(Minn.Ct.App. 1992) (citing Hagedom vv, Aid Ass'n. for
Lutherans, 211 N.W.2d 154, 157 (Minn. 1973). The
Minnesota Supreme Court has also stated:
"Thus, if a principal acts or conducts his business, either
intentionally or through negligence, or fails to disapprove
of the agent's acts or course of action so as to lead the public
to believe that his agent possesses authority to act or contract in
the name of the principal, the principal is bound by the acts of
the agent within the scope of his apparent authority as to
persons who have reasonable grounds to believe that the
agent has such authority and in good faith dealt with him."
McGee _v. Breezy Point _Extates, 166 N.W.2d 81, 89
(Minn. 1969) (citing 3 Am.Jur. 2d Agency S 74).
While the particular language used may be somewhat different
in Bergstrom, the principles and ideas are identical to that
expressed by the Minnesota Supreme Court in McGee and
12
Hagedorn. Greenberg entered into a settlement agreement on
behalf of the plaintiff with defendants who reasonably
believed he had the authority todo so. Even if, as plaintiff
contends, he limited Greenberg's settlement authority, he
never communicated any such limitation to the defendants
before the settlement agreement was made.
Plaintiff has not produced, by the materials submitted for
court was incorrect in relying on the reasoning in Bergstrom or
that Greenberg's apparent authority was less extensive than
full settlement authority. In his Memorandum of Law
plaintiff claims bad faith on the part of Greenberg should
result in the settlement agreement being unenforceable. See,
plaintiffs Memorandum of Fact and Law dated August 4,
1992, page 8. This court, relying on the affidavits, finds more
persuasive the accounts given by Greenberg and Roy A.
Ginsburg, the attorneys involved in the negotiation the
settlement agreement on September 27, 1991, than the
account given by the plaintiff in an unsworn, transcribed
conversation he allegedly had with Greenberg. Accusing
two officers of the court of acting in concert to dismiss
claims because they knew plaintiff would never voluntarily
dismiss the claims himself is preposterous. Moreover,
defendants should not be punished for any alleged misdeeds or
negligence by Greenberg as plaintiff's agent. As a result, this
court sustains its earlier alternative ruling that Greenberg had
the apparent authority to enter into the settlement agreement
for the plaintiff.
C. Terms of the Agreement Prohibit Enforcement
1. Personal Action By Plaintiff Was Required
A further argument by the plaintiff for non-enforcement of
the settlement agreement is that the express terms of the
13
settlement agreement form require personal action on his part
before any such agreement can be binding on him.
First, plaintiff specifically cites prg. 10 of the settlement form
which states, "Mr. Bergmann specifically acknowledges that
he enters into this Settlement Agreement and General
Release in a knowing and voluntary manner." Using this
quoted language, plaintiff makes the argument that only he
personally and individually could authorize the agreement to
be binding on him.
In evaluating the plaintiff's argument, this court believes it
relates more to a claim of coercion or fraud. However, a fraud
argument by the plaintiff has previously been dismissed by
this court as unfounded in its Order and Memorandum of March
27, 1992. Plaintiff's attempt to use the language “knowing
and voluntary manner" as a_ requirement for personal
accession to the settlement agreement is untenable.
Attorneys, as agents for clients, can enter into a stipulation to
settle and compromise a client's right of actions with express
authorization from the client. Austin Farm Center v. Austin
Grain Co., 418 N.W.2d 181 (Minn.Ct.App. 1988). Implicit in
granting attorneys the right to settle their clients claims, is
an understanding that the client authorizes such a settlement
and is knowing and voluntarily entering into the settlement
through his or her attorney. The language in prg. 10 of the
settlement agreement is merely a written recital of the
requirement that, if an attorney is the person agreeing to the
settlement, the attorney has the authority of his or her client.
By this court's prior alternative holdings that Greenberg had
express and apparent authority to settle the claims of the
plaintiff, this court implicitly acknowledges that plaintiff
knew and approved of the settlement agreement.
Related to plaintiff's argument is one of the issues raised by the
court in its Order of July 14, 1992, namely the effect of a
14
signature line for plaintiff on the settlement agreement.
Defendants argue that the signature line has no effect since
Greenberg, as an agent for the plaintiff, orally agreed to
accept the material terms of the agreement even before it was in
writing. Plaintiffs Memorandum August 4, 1992, page 14.
Defendants further argue that obtaining plaintiffs signature
was a ministerial task which should not affect the validity of
the settlement agreement, relying on Bergstrom for support. Id.
The court is persuaded by defendants’ argument. Greenberg,
as plaintiff's attorney, did have the authority to orally agree
toa settlement agreement which would bind his client. Johnson
v. Sitzmann, 413 N.W.2d 541 (Minn.App. 1987). Merely
transferring the oral agreement to written form does not
change the fact that a settlement had been reached. Before
anything had been reduced to writing, the parties had already
perfected a settlement of this case through their attorneys.
To invalidate the agreement merely because of a _ signature
line in the after prepared written agreement seems
ludicrous to this court. Greenberg's oral settlement of
plaintiffs claims, through his express and apparent
authority, makes the lack of plaintiff's signature on the
memorialization of the settlement agreement immaterial.
Plaintiff further argues that he was required to sign the
settlement agreement because he appeared in the case, and
therefore no voluntary dismissal in this case is valid without
his signature. See, Minn.R.Civ.P. 41.01(a)(2). The court is
not persuaded by plaintiffs argument since it is premised on
the incorrect assumption that plaintiff had appeared in this
action prior to the settlement agreement.
Plaintiff claims that a letter he sent to counsel of defendant
Brian Kovalchuk constitutes an appearance in this case. A
party does appear in an action when he or she serves or files
any paper in the proceeding. Minn.R.Civ.P. 5.01.
15
However, this court does not agree with plaintiff's interpretation
of Rule 5.01 based upon the facts of this case. The letter
plaintiff sent to defendant Kovalchuk's attorney was not
serving or filing a paper in this case. The letter was merely ex-
parte communication by plaintiff and did not constitute the
service or filing envisioned by Rule 5.01. Thus, because
plaintiff did not appear in this matter before the settlement
agreement was made, his signature as a party was not
required on the agreement.
Personal action on the part of the plaintiff was not
required for the settlement agreement to be valid. This court's
holding that Greenberg had both express and apparent
authority to enter into the settlement agreement on
plaintiff's behalf makes any such action unnecessary.
2. Stipulation and Order for Dismissal
Plaintiff argues that the Stipulation and Order for Dismissal
signed by the parties to this case is strictly prohibited by the
express terms of the settlement agreement and therefore is
invalid.
All parties agree that the dismissal stipulation is based on
the settlement agreement. Plaintiff cites prg. 7 of the
settlement agreement which states:
"There are no covenants, promises, undertakings, or
understandings outside of this Settlement Agreement and
General Release other than as herein specifically set forth.
Any modification of, or addition to, this Settlement Agreement
and General Release must be in writing, signed by all parties."
Plaintiff uses this provision as the basis for arguing that the
Stipulation for Dismissal is a modification and as such should
have been drafted as an amendment to the agreement, with
all parties also being required to sign.
16
This court cannot take the disingenuous view of a dismissal
stipulation that plaintiff proposes. Upon reading the clear
language of the settlement agreement, it is obvious that
prg. 7 envisioned outside agreements other than a stipulation
for dismissal. To read prg. 7 as prohibiting stipulations for
dismissal is to give the settlement agreement no real effect.
Without a dismissal stipulation, the end result envisioned by
the parties upon entering into the settlement agreement
would never occur.
Courts effectively view a stipulation for dismissal as a
settlement agreement; while the parties have the settlement
agreement as the embodiment of their final agreement,
courts view the stipulation for dismissal as _ the
embodiment of the parties’ settlement. Plaintiff's argument
that a stipulation for dismissal is a modification of the
settlement agreement is absurd. The court must give full
enforcement to the Stipulation for Dismissal filed with this
court since it embodies the parties’ agreement that this
case is fully settled.
D. The Parties Never Formed A Contract
Plaintiff argues that a contract was never formed between the
parties, thus any purported settlement agreement initialed by
Greenberg cannot be valid. In support of his argument
plaintiff states that the proposed draft agreement was never
signed by the defendants or their counsel before it was
submitted to Greenberg for his approval. iso, plaintiff
claims that the material provisions of the draft agreement
did not conform to the provisions he sought and furthermore,
he would never have agreed to the terms contained in the
settlement agreement that defendants are now trying to enforce.
This court agrees with plaintiff's assertion that a settlement
agreement is a contract between the parties and, as such, is
17
governed by contract principles such as offer, counteroffer
and withdrawal of offers. Plaintiffs claim that offers and
counteroffers were made by the parties to this suit during the
settlement negotiation process is logical to this court.
However, plaintiff's argument that the settlement agreement is
not valid because he would never have agreed to its terms
is irrelevant in light of the fact that this court previously
determined that Greenberg had express and apparent
authority to settle plaintiffs claims with the defendants.
Plaintiff is once again _ claiming that he limited
Greenberg's authority to settle his claims, an argument that
this court does not find persuasive.
The court believes that Greenberg orally accepted the settlement
offer on behalf of the plaintiff during the afternoon of
September 17, 1991. Greenberg subsequently signed
and dated a memorialization of the oral agreement later in
the afternoon on that same September day. The failure
of defendants personally, or of their agents, to sign the
settlement agreement is inconsequential since a settlement was
reached at the moment the representatives for the
plaintiff and the defendants orally agreed to terms. The
subsequent memorialization of that oral agreement did not
change the fact that a settlement agreement had been reached
by the parties. Thus, whether defendants or their agent
signed the written memorialization before plaintiff's
representative signed it is immaterial since nothing contained
in the written memorialization of the oral settlement agreement
could change the fact that an agreement had been made.
Greenberg's notation that the written memorialization met the
discussion terms is further proof that the parties had reached
a prior oral settlement agreement. Plaintiff's argument that
a contract was never formed between the parties is unfounded
- whether through offers or counteroffers by the parties, during
the afternoon of September 17, 1991, one offer was orally
accepted by plaintiffs agent which was _ later memorialized.
18
Upon reconsideration, this court has considered numerous
arguments for and against the enforcement of the purported
settlement agreement between the parties. The court is
convinced that the settlement agreement was validly entered
into by Greenberg, as agent for the plaintiff, and that he had
both express and apparent authority to so act. Finding just
reasons for enforcement, this court rules upon reconsideration
that defendants’ motion for enforcement is granted.
II. Court Ordered Sanctions
In an Order of March 27, 1992, this court alternatively held
that dismissal of this case was appropriate because plaintiff
failed to comply with the clear terms of the court's Order
of August 6, 1991, which required that certain monetary
sanctions be paid. In ordering reconsideration of this case, the
court raised several issues for argument by counsel which
involved the prior sanctions imposed on __ the plaintiff. In
reviewing the submissions to the court on the reconsideration
motion, it is evident that plaintiff has acted in a dilatory and
obstructionist manner. For example, plaintiff was ordered to
pay a $2,000 sanction by Judge Sommerville by November 25,
1990. Upon tniely motion by the plaintiff, the court
reconsidered its ruling and extended the due date for the
sanctions to February 18, 1991. Defendants brought a
motion to compel compliance or dismiss the case when the
sanctions had not been paid by the end of March 1991.
This court denied defendants’ motion to dismiss and
imposed the lesser sanction of an award of attorneys’ fees and
$1,000 in court costs, while also ordering plaintiff to pay the
original $2,000 sanction. Order of August 6, 1991. Plaintiff
finally paid the $2,000 sanction on August 16, 1991. The
plaintiff also paid the $1,000 in court costs on September
16, 1991.
19
This court amended its Order on August 14, 1991, to clarify
that the amount of attorneys’ fees payable by plaintiff was
$7,247.50. The Order expressly provided that the attorneys’
fees were payable to the defendants within 60 days of the
Order dated August 6, 1991, and that failure to comply
would result in an invitation by the court to reconsider
defendants' motion to dismiss the complaint with prejudice.
Amended Order dated August 6, 1991. Defendants have never
received payment of the attorneys’ fees, however, the settlement
agreement did forgive their payment.
Plaintiff has ardently asserted that the sanctions imposed upon
him by the court were not required to be paid until he
completed discovery in this case. This assertion is contrary
to the plain language of the orders of the court. Each time
sanctions were imposed against the plaintiff or the issue of
sanctions was revisited, the court specified a date by which
the sanctions were to be paid by the plaintiff. None of the
court's orders gave plaintiff a reprieve from paying sanctions
until his discovery was complete.
Based upon plaintiff's actions to date in this case, this court
once again alternatively holds that if it had found Greenberg
did not have express or apparent authority, this case would
be dismissed for failure to comply with the clear terms of the
court's Order of August 6, 1991.
III. Motions to Strike
Defendants’ have made two separate motions to strike
specific pleadings, namely plaintiffs Memorandum of Facts
and Law (dated August 4, 1992) and the Affidavit of Daryl J.
Bergmann (dated August 3, 1992). As this court does not find
that the pleadings rise to the level required by Rule 12.06 for
matter to be stricken, defendants’ motions are both denied.
20
Rule 12.06 states in pertinent part:
"Upon motion made by a party...the court may order any
pleading not in compliance with Rule 11 stricken as sham and
false, or may order stricken from any pleading any insufficient
defense or any redundant, immaterial, impertinent or
scandalous matter."
Defendants’ claim that the pleadings should be stricken for
the redundant, immaterial, impertinent or scandalous matter
contained therein.
Rule 12.06, as quoted above, is identical to Rule 12(f) of
the Federal Rules of Civil Procedure. While there is little
reported case law on Rule 12.06 in Minnesota, he
application and use of Rule 12(f) in federal cases is
unfortunately prevalent. This court is also mindful of the fact
that it has considerable discretion in striking redundant,
immaterial, impertinent or scandalous matter from court
records. Alvarado-Morales vy. Digital Equipment Corp., 843
F.2d 613, 618 (Ist Cir. 1988) (citing Fed.R.Civ.P. 12(f)).
While both of the pleadings that defendants’ have moved to
strike contain material that is argumentative, derogatory
and possibly unfounded, this court is loath to strike them
because defendants have not been prejudiced in any way.
Distrust and animosity have permeated this case from the
start and plaintiff has made allegations in his pro se
submissions of conspiracy and duplicity by numerous officers
of the court. However, this court has not beenpersuaded by
plaintiff's arguments and defendants have in no way been
prejudiced before this court by those arguments. In light of
the fact that defendants have not suffered prejudice by
plaintiffs pleadings, this court denies both of defendants’
motions to strike.
21
IV. Motions to Supplement the Record
Plaintiff has made two separate motions to supplement the
record pursuant to Minn.R.App.P. 110.03, and defendants
oppose both motions. The court considers both motions to be
moot since plaintiff no longer currently has an appeal
pertaining to this case pending. [However, due to the fact
that plaintiff has already appealed orders from this case and
therefore is likely to appeal this order, the court will decide
the motions to supplement the record now and preclude the
same motions ata later date.]
V. Conclusion
This court is convinced that plaintiff's attorney Greenberg had
both express and apparent authority to enter into the
settlement agreement defendants have moved to enforce.
Alternatively, this court mules that plaintiff's failure to pay
court ordered sanctions in a timely manner necessitated
dismissal with prejudice of this action.
Both motions to strike certain pleadings by the plaintiff are
denied by this court since defendants have not shown that
the pleadings in question areprejudicial. Plaintiffs motions
to supplement the record are denied on mootness grounds by
this court.
22
OTHER OPINIONS IN THE CASE
STATE OF MINNESOTA
IN COURT OF APPEALS
C8-93-1526
Filed August 19, 1993
Daryl Bergmann, Appellant,
vs.
Lee Data Corporation, et al, Respondent, Sarah A. MacRae,
Respondent.
ORDER
BASED UPON THE FILE, RECORD AND PROCEEDINGS
HEREIN, AND BECAUSE:
1. This appeal was filed July 30, 1993.
2. By order on August 31, 1992, this court dismissed
appellant's appeal from an April 16, 1992 judgment denying
his motion to vacate, without prejudice to appellant's right to
perfect a timely new appeal from the order or judgment
resulting from the pending proceedings to reconsider.
3. In this appeal, appellant seeks review of the April 16
judgment and a May 3, 1993 judgment adjudicating the
motion to reconsider.
This court's August 31, 1992 order in appeal C1-92-1292
dismissed with prejudice appellant's challenge to orders issued
23
prior to the October 1991 judgment of dismissal. However,
appellant indicates in his statement ofthe case in this appeal
that he intends to raise issues pertaining to pretrial discovery
sanction orders. We willdismiss this part of the appeal,
consistent with our August 31 order in appeal C 1-92-1292.
5. Appellant failed to file the $250.00 filing fee for this appeal
or an order from the trial court waiving the fee. See
Minn.R.Civ.App.P. 103.01, subd. 3.
6. By notice of case filing dated July 30, 1993, the Clerk of
the Appellate Courts, pursuant to this court's direction, noted
the above deficiency and directed it be remedied within 10 days.
7. Appellant has not complied with this directive.
IT IS HEREBY ORDERED:
1. The part of che appeal from orders issued prior to the
October 1991 judgment of dismissal is dismissed.
2. The balance of the appeal shall proceed pursuant to the
rules of civil appellate procedure.
3. On or before August 30, 1993, appellant shall file either
the $250.00 filing feeor a trial court order waiving the fee.
4. Failure to comply may result in the imposition of
sanctions, including dismissal.
Dated: August 18, 1993 BY THE COURT
Paul H. Anderson
(Signed)
Chief Judge
24
STATE OF MINNESOTA
IN COURT OF APPEALS
C1-92-1292
Filed September 25, 1992
Daryl Bergmann, Appellant,
Vs.
Lee Data Corporation, et al, Respondent, Sarah A. MacRae,
Respondent.
ORDER
BASED UPON THE FILE, RECORD AND PROCEEDINGS
HEREIN, AND BECAUSE:
l.
On September 8, 1992, appellant filed a motion in this
court to correct the record. No response to the motion
has been filed.
Appellant's motion appears to be made in opposition to
a pending motionin the trial court brought by
respondents and servedon August 19. Appellant did
not provide a copy of respondents’ motion and the
nature of the relief respondents seek in the trial court is
unclear.
Appellant should s ubmit his response to respondents’
motion to the trial court, not this court. Moreover, if
appellant seeks to correct or modify the record on appeal,
the motion must be submitted to and determined by the
trial court. See Minn.R.Civ.App.P. 110.05.
25
IT IS HEREBY ORDERED:
l.
Appellant's motion to correct the record is denied in its
entirety.
Appellant's brief remains due 30 days after the
transcript was delivered. See Minn.R.Civ.App.P.
131.01.
The Clerk of the Appellate Courts shall provide
copies of this order to the Honorable Kevin S. Burke,
counsel of record, and the trial court administrator.
Dated: September 24, 1992
BY THE COURT
Paul H. Anderson
(Signed)
Chief Judge
26
STATE OF MINNESOTA DISTRICT COURT
COUNTY OF HENNEPIN FOURTH JUD. DIST.
MC 89-12254
Dated July 14, 1993
Daryl J. Bergmann, Plaintiff,
vs.
Lee Data Corporation, et al, Defendants.
AMENDED ORDER
The above entitled matter came on for hearing on January 14,
1992 before the undersigned Judge of District Court
pursuant to plaintiffs motion to vacate dismissal pursuant
to parties' agreement. In a letter dated May 26, 1992.
Plaintiff appeared pro se at the January 14th hearing. Roy
Ginsburg, Esq. and Karen Maki, Esq. appeared on behalf of
the defendants Lee Data Corporation (now known as Apertus
Technologies), Robert Gordon, Gary White, Robert Besinger
and Brian Kovalchuk. Jonathan Steinberg, Esq. appeared on
behalf of the defendant Sarah MacRae. Alan C. Greenberg.
Esq. attended the proceeding.
Based upon the files, records and proceedings held herein,
the Court makes the following:
ORDER
1) Both parties are submit affidavits and memoranda of
law concerning the following issues:
a) whether plaintiff paid Judge Sommerville's court ordered
sanctions,
27
b)
c)
d)
2)
whether plaintiff paid the $1000 in court ordered
sanctions,
whether plaintiff was required to pay sanctions until
completion of his discovery,
the legal effect of the settlement agreement having a
line requiring plaintiff's signature.
These affidavits and memoranda are tobe submitted to
the Court within 21 days of this Order. Upon
submission, this Court will reconsider defendants’ motion
to enforce the settlement agreement.
DATED: July 14, 1992
BY THE COURT:
Kevin S. Burke
(Signed)
Judge of District Court
28
STATE OF MINNESOTA DISTRICT COURT
COUNTY OF HENNEPIN FOURTH JUD. DIST.
MC 89-12254
Dated March 27 , 1992
Daryl J. Bergmann, Plaintiff,
vs.
Lee Data Corporation, et al, Defendants.
ORDER AND MEMORANDUM
The above entitled matter came on for hearing on January 14,
1992 before the undersigned Judge of District Court
pursuant to plaintiff's motion to vacate dismissal _ pursuant
to parties’ agreement.
Plaintiff appeared pro se. Roy Ginsburg, Esq. and
Karen Maki, Esq. appeared on behalf of the defendants.
Based upon the files, records and proceedings held herein,
the Court makes the following:
ORDER
1) Plaintiffs motion to vacate the dismissal is denied.
2) The attached memorandum is incorporated herein
by reference.
LET JUDGMENT BE ENTERED ACCORDINGLY.
DATED: March 27, 1992
BY THE COURT:
Kevin S. Burke
(Signed)
23
MEMORANDUM
Bergmann v. Lee data Corporation
March 27, 1992
INTRODUCTION
The parties' dispute centers around the validity of a
purported settlement agreement. Plaintiff's attorney and
defendant's attorneys argue that they entered into a
settlement agreement. Plaintiff claims that his attorney did not
have authority to enter into this particular settlement
agreement. Plaintiff brought this motion to vacate the
dismissal based on the settlement agreement.
FACTS
This motion is the next stage in a lawsuit which was
already long and protracted when it case before this Court
in 1991 on defendants’ motion to dismiss the complaint with
prejudice pursuant to Minn.R.Civ.P. 37.02(b)(3) and
41.02(a). The motion was based on plaintiffs failure to
comply with a court order to pay attorney's fees and
plaintiffs general = unreasonable vexatious conduct and
obstructionist tactics. Although this Court did not grant the
motion, it did impose significant sanctions. In so doing,
this Court observed that "there is no legitimate reason
advanced by the plaintiff for failure to comply with [the
Court's} order. At __ best, plaintiff's position is that he and
his attorney have acted in_ reckless disregard of the clear
and unmistakable terms ofa simple order. At worst, plaintiff
and his attorney have intentionally and without any
justification violated a court order." Memorandum of Aug. 6,
1991 at 3-4. This court concluded that:
“Even though the defendants may not have suffered the sort of
harm or prejudice which would justify outright dismissal,
30
" i ve , : i er
OTST (eM ed eae ORI Miah Mew SEN ee Lh eee ee ee PES ny. LN RRL NS REE AI LO I eT IOES ER, PBR TON Ley Eee eRe ee SY ee ee
during the course of this litigation, the plaintiff has abused
the limited amount of time this court has to resolve disputes.
This abuse was clearly wilful and is made more offensive in
that plaintiff is an attorney himself and has no basis for claiming
ignorance. It is not incumbent on this Court to sit idly by and
thereby subsidize and encourage and sanction conduct which
unjustifiably and excessively depletes a scarce resource--
this Court's time. This conduct justifies requiring the
plaintiff to pay all of defendant's attorney's fee and a fine
for abusing the court's time.”
Id, at 24-25 (emphasis in original).
After the issuance of the Order imposing sanctions, on
September 26 and 27, 1991, defendants’ counsel, Roy
Ginsburg and Karen Maki, took the depositions of Diana
Hanson, a former employer and client of plaintiff, and Mindy
Mitnick, a psychologist and consultant previously retained by
plaintiff. Plaintiff claims that these depositions contain
manufactured testimony, false and slanderous comments
and were manipulated to fraudulently bolster each other.
Following there depositions, plaintiff claims that defendants
threatened him with new and unspecified court sanctions.
Plaintiff, who is now acting pro se, also claims that his
attorney showed him a counterclaim for the first time and told
him that it would be burdensome to go forward with the case
since Hanson's and Mitnick's testimony “dovetailed”. Finally,
plaintiff claims that his attorney asked him to hurry and make
up his mind about a dismissal, since his attorney said he
intended to leave on vacation that evening.
Plaintiff's version of the circumstances surrounding the signing
of the agreement to dismiss the case is as follows:
"Under advice of counsel, plaintiff then agreed to allow
counsel to ask defendants about the terms of a settlement
31
ee eee ee ee
subject to a mutual release. Plaintiff's counsel called plaintiff
at home later that afternoon to convey the terms of the
settlement agreement. Defendants required plaintiff to give up
and transfer his stock in Lee Data (Apertus Technologies,
Inc.) and agree not to repurchase any stock for a period of at
least five years. Plaintiff agreed to consider the terms
and returned a call to his counsel about thirty minutes later.
Plaintiff then asked counsel to negotiate a price for the stock
and to obtain defendants’ absolute assurances of
confidentiality with respect to plaintiffs medical records and
the testimony of Mitnick, which was noted as being subject to
the existing Protective Order in the case. Plaintiff's counsel
then contacted defendants, and returned their answer to the
plaintiff that they would agree to confidentiality but would not
agree to pay for the stock. Plaintiff then instructed his
counsel that he would not allow any document to be signed
without first being able to read it. Counsel said he would
sign a letter of intent that could be reviewed and revised upon
his return from vacation October 14, 1991."
Plaintiffs Memorandum of Law at 2 (emphasis added).
Plaintiff claims that he later learned that his attorney had
signed an unconditional dismissal in the case and a draft release
was presented which contained a unilateral release and a
release of defendants’ attorneys. Plaintiff asserts that he
immediately objected to his attommey in person upon his
attorney's return from vacation and confirmed his objection in
a letter which was hand delivered that same day with a copy
sent by mail.
This Court's Order of August 6, 1991 provided, in lieu of
granting the motion to dismiss, that plaintiff pay the original
$2,000 in attorney's fees as previously ordered within 10 days
of the order, that plaintiff pay all of defendants’ attorney's
fees as a result of bringing the motion within 60 days of the
order and that plaintiff pay $1000 in court costs payable
32
within 30 days of the order as a_ sanction for
obstructionist litigation tactics. Neither party disputes that
plaintiff has not met any of these conditions.
ISSUES
1. Whether the parties’ agreement was based on coercion,
fraud or collusion?
2. Whether Bergmann's attorney had authority to enter into
the agreement?
3. Whether the Court as an alternative holding should
dismiss this action for failure to comply with
sanctions previously imposed?
ANALYSIS
This Court must decide whether or not to set aside the parties’
agreement to dismiss the case. In making this decision,
this Court is mindful of the Minnesota Supreme Court's
admonition that settling suits without trial is greatly favored
and that Minnesota courts should not set aside such
agreements lightly. Johnson v. St.Paul Insurance Co, 305
N.W.2d 571, 573 (Minn. 1981).
I. Fraud
Plaintiff claims that the dismissal and proposed settlement
agreement must be set aside and vacated for fraud. He
asserts that “defendants' deposition and discovery tactics
amounted to a fraud on the Court and against plaintiff because
of the material false and oppressive testimony. That
testimony and defendants’ threats of sanctions and attorney
fees in connection with their proposed motion to dismiss
amounted to an illegal coercion in violation of Minn.Stat.
Sec. 609.27..." Plaintiffs Memorandum of Law at 3.
33
ee i
Plaintiff further asserts that defendants caused him to forbear
his lawful right to proceed with the lawsuit by threatening to
ruin him in his profession by exposing false and defaming
perjured testimony against him. Id.
This Court is not persuaded by plaintiffs arguments.
His claim basically amounts to saying that defendants
threatened him _ with presenting evidence at trial which
would be unfavorable to him, and that this was wrong. There
is nothing impermissible or fraudulent in this. In fact,
claiming that one's evidence is damaging to the opposing party
is the very essence of pretrial negotiation and settlement
tactics. If courts were to set aside settlements on this ground,
no settlement agreement would ever be enforceable against
any party. Itcertainly would have been within plaintiff's
power to contradict or impeach defendant's testimony
and evidence at trial rather than entering into a settlement
agreement. Plaintiff cannot blame defendant for his faiiure to
avail himself of this opportunity.
II. Authority to Settle
Mr. Bermann's attorney argues that his client had authorized
him to settle the case Mr. Bergmann asserts that he told his
attomey not to approve any settlement without consulting
him. This Court must determine whether Mr. Bergmann's
attorney had authority to enter into this agreement.
An attorney compromising a claim must have authority in
order to bind their clients. _Schumann vy. Northtown Ins.
Agency, Inc. 452 N.W.2d 482 (Minn.Ct.App. 1990).
If an attorney enters into an agreement without his client's
authorization, Minn.Stat. Sec. 481.09 provides in relevant part
that:
"At any stage of the proceedings the court may relieve a
party from the consequences of the unauthorized acts of an
34
Implied Authority
Even if Bergmann's attorney did not have express authority to
settle this case, the settlement could be binding under one or
more of three other theories: estoppel, ratification and
implied/apparent authority.
Estoppel
Estoppe! is an equitable doctrine addressed to the discretion
of the trial court. Johnson _v. Sitzman, 413 N.W.2d 541, 545
(Minn.Ct.App. 1987) (citation omitted). In order for
equitable estoppel to apply, a party must demonstrate
inducement through language or conduct to rely in good faith
on the language or conduct resulting in injury, detriment, or
prejudice. Id. (citation omitted). This court would not hesitate
to find that a reasonable person could be induced to rely
based on Bergmann's conduct. In this case, however, this
court can find no injury, detriment or prejudice to Lee Data
apart from the mere extension of already protracted
proceedings. The parties are simply back where they were
before the alleged settlement agreement was signed--they are
no better or worse off.
Ratification
A client can be bound if he either expressly or impliedly
ratifies the agreement. Skalbeck v. ___Agristor Leasing,
384. NW.2d 209, 213 (Minn.Ct.App. 1986) (citation
omitted). Both conduct and verbal expression can constitute
acceptance. Id. (citation omitted). Silence can be
acceptance where there is a duty to otherwise deny. Id.
In Skalbeck, a written agreement was sent to buyer's of a
silage loader with respect to a settlement of a_ breach of
warranty action against the seller and manufacturer. Id. The
buyers did not dispute the terms of the settlement agreement
36
for six months and the buyers failed to affirmatively contact
their attorney to dispute the settlement of the breach of
warranty claim against the seller. Id. The trial court made
express findings of fact so the issue before the Court of
Appeals was whether there was “any reasonable basis in the
record” for the trial court's decision. Id. at 212. The
Skalbeck court determined that the trial court could have
reasonably found that the six months’ delay and the buyers’
failure to affirmatively contact their attorney regarding the
settlement amount to an implied acceptance of the settlement.
Id. at 214. See also Schumann v. Northtown Ins. Agency,
452 N.W.2d 482 (Minn.Ct.App. 1990) (attorney's written
acceptance of settlement offer was binding on clients who,
after receiving a copy of the written acceptance, failed to
repudiated authorization until three months later); Austin
. 418 NW.2d 181
(Minn.Ct.App. 1988) (creditor impliedly accepted or ratified
oral settlement offer presented by debtor's attorney to creditor's
attorney where creditor's attorney kept the settlement check
for three months and cashed it before responding to the
offer, creditor's attorney then wrote letter indicating that he
had not yet received permission to sign stipulation of
dismissal, but failing to indicate that creditor refused to
sign stipulation, and only communication from creditor from
debtors after _— letter was notice seen cf
R & Young, 376
N.W.2d 434 (Minn. Ct.App. 1985) (Where Sicuhies retained
the settlement check for eighteen months without notifying
the corporation that it would not be accepted as payment in
full, court could have properly concluded that Rosenberg had
impliedly accepted the offer of settlement).
The facts of this case do not allow this Court to find that Mr.
Bergmann ratified the purported settlement agreement either
through conduct or verbal expression. He brought this
motion soon after the agreement was signed by his attorney.
37
He would had to have kept silent for a significantly longer
period in order for cases like Skalbeck and Schumann to be
controlling here. By bringing this motion, Mr. Bergmann
obviously has affirmatively contacted his attorney regarding
the settlement and has not remained silent.
Apparent Authority
Lee Data contends that Mr. Bergmann's attorney had
apparent authority to settle forhim. It is true that the rules
and principles of the law of agency control the relation of
attorney and client. Schumann, 452 N.W.2d 484.
Lee Daia argues that Bergstrom v. Sears, Roebuck & Co., 532
F.Supp. 923 (D.Minn. 1982), should be controlling in this
case. In Bergstrom, one of the issues was whether the party's
attorney, who was authorized by defendant's president and
board chairperson and owner of 96% of the shares of the
corporation to settle the lawsuit, had the authority to bind the
defendant to a settlement agreement.
The court noted that the doctrine of apparent authority
applies when:
"A principal has, by his voluntary act, placed an agent in such
a situation that a person of ordinary prudence conversant with
business usages and the nature of the particular business is
justified in assuming that such agent has authority to perform
a particular act and deals with the agent upon that assumption,
the principal is estopped as against such third person from
denying the agent's authority; he will not be permitted to prove
that the agent's authority was, in fact, less extensive that that
with which he was apparently clothed. This rule has been
based upon the principle that where one of two innocent
parties must suffer from the wrongful act of another, the loss
should fall upon the one who, by his conduct, created the
38
circumstances which enabled the third party to perpetrate the
wrong and cause the loss.
Id. (quoting 3 Am.Jur. 2d Agency S. 76 (1962)).
In Bergstrom, the court found the following actions gave
rise to apparent authority:
1)
2)
3)
4)
5)
6)
the attorney was retained for the specific purpose of
pursuing a settlement of the lawsuit,
Opposing counsel inquired of the principal regarding
the attorney's status and principal's representative
confirmed that the attorney had been retained,
although in the initial discussions, the attorney's
authority was expressly limited to negotiating, he
later approached opposing counsel with a new offer of a
different package than had been negotiated earlier and
he acted in the same manner as any other attorney with
authority to settle a lawsuit,
Principal's representatives at no time did anything to
indicate to the opposing party that attorney had less
than full authority to settle, despite the fact that they
were in frequent contact with the opposing party during
that time period,
When principal's house counsel received the drafts of
the settlement letter, he failed to disavow the
agreement, and
At no time did anyone from principal's company
take the step of informing the opposing party that
attorney's authority had been terminated. Id. at
933.
39
Pere:
Spa!
Bergstrom was a case in federal court, and has not yet been
cited by any Minnesota state appellate court. This court,
however, finds the reasoning persuasive. Minnesota state
appellate courts have recognized the doctrine of apparent
authority. See, ¢.g., Homblower_& Weeks-Hemphill
Noyes _v. Lazere, 222 N.W.2d 799 (Minn. 1974) (employee
had apparent authority to receive defendant's request for
return of his stock because all of defendant's business with
plaintiff was conducted through a stockbroker-employee
of plaintiff and defendant was not advised that the employee
was unable to handle his request for the return of the
stock.). as noted above, Minnesota courts also recognize that
the law of agency applies tothe attorney-client relationship.
The facts of this case fall within the Bergstrom court's
definition of apparent authority: Bergmann's attorney, as his
agent, was placed by Bergmann in the position of
negotiating a settlement agreement and defendants’ counsel
was justified in assuming he had such authority (based
on settlement negotiations) and dealt with him on that
assumption (by entering into the agreement).
Like in Bergstrom, in this case there were circumstances
giving ise to attorney's authority, an intervening act which
could have divested the attomey of authority (in
Bergstrom, the termination of authority, in this case, Mr.
Bergmann’'s alleged statement to his attorney that he would
have to approve of all the terms of any settlement
agreement) as well as a failure to alert opposing counsel. Given
the failure to notify the opposing party, the opposing party
reasonably assumed Mr. Bergmann's attorney had authority to
enter into the settlement agreement. Therefore, Mr. Bergmann
is now estopped from denying such authority.
40
IfI. Failure to Comply with Sanctions
Pursuant to the Court's Order of August 6, 1991, plaintiff was
ordered to do the following in order to prevent the dismissal
of his claim:
1) Plaintiff shall within 10 days of this order pay the
original $2,000 in attorney's fees to the defendants
ordered by Judge Sommerville in his order dated
January 28, 1991.
2) Plaintiff shall pay all of defendant's attorney fees
incurred as a result of bringing this motion. These
attorney's fees shall be paid within 60 days of this order.
3) the court hereby imposes a $1000 court cost payable to
the District Court within 30 days of this order as a
sanction for obstructionist litigation tactics.
4) the failure to comply with any provision of this order
will result in an invitat'<i: oy the court to reconsider
defendants’ motion to dismiss with prejudice.
Order of August 6, 1991 at 1.
Plaintiff has not complied with the terms of this Order. If
the Court would have been unable to find either of the two
independent grounds for its decision above, i.e. that it found Mr.
Bergmann's attorney's testimony regarding express authority
more credible and that it found that Mr. Bergmann had
apparent authority to settle the suit, this Court would have
dismissed the case for failure to comply with the clear terms
of the Order.
41
REFERENCED STATUTES, RULES AND
PROVISIONS PURSUANT TO USSC RULE 14.1(f)
REFERENCED RULES OF THE MINNESOTA RULES
OF CIVIL PROCEDURE:
Rule 6.04 For Motions; Affidavits
A written motion, other than one which may be heard ex parte,
and notice of the hearing thereof shall be served no later than 5
days before the time specified for the hearing, unless a
different period is fixed by these rules or by order of the
court. Such an order may for cause shown be made on ex
parte application. A motion may be supported by papers on
file by reference; supporting papers not on file shall be
served with the motion; and, except as otherwise provided in
Rule 59.04, opposing affidavits may be served not later than
one day before the hearing, unless the court permits them to
be served at some other time.
Rule 7.02 /Zations And Other Papers
(a) An application to the court for an order shall be by motion
which, unless made during a hearing or trial, shall be in
writing, shall state with particularity the grounds therefor,
and shall set forth the relief or order sought. The
requirement of a writing is fulfilled if the motion is stated in a
written notice of the hearing of the motion. Motions provided
in these rules are motions requiring a written notice to the
party and a hearing before the order can be issued unless
the particular rule under which the motion is made specifically
provides that the motion may be made ex parte. The parties
may agree to written submission to the court for decision
without oral argument unless the court directs otherwise.
Upon the request of a party or upon its own initiative, the
court may hear any motion by telephone conference.
42
(b) The rules applicable for captions, signing, and other
matters of form of pleadings apply to all motions and other
papers provided for by these rules.
(c) All motions will be signed in accordance with Rule 11.
Rule 11 Signing Of Pleadings, Motions And Other
Papers; Sanctions
Every pleading, motion and other paper of a party represented
by an attorney shall be personally signed by at least one
attorney of record in the attorney's individual name and shall
state the attorney's address, telephone number, and attorney
registration number. A party who is not represented by an
attorney shall personally sign the pleading, motion or
other paper and state the pleader's address and telephone
number. Except when otherwise specifically provided by
rule or statute, pleadings need not be verified by affidavit
or accompanied by affidavit. The signature of an attorney or
party constitutes a certification that the pleading, motion or
other paper has been read; that to the best of the signer’s
knowledge, information and belief formed after reasonable
inquiry it is well grounded in fact and is warranted by
existing law or a good faith argument for the extension,
modification, or reversal of existing law, and that it tis not
interposed for any improper purpose, such as to harass or cause
unnecessary delay or needless increase in the cost of litigation.
If a pleading, motion or other paper is not signed, it shall be
stricken unless it is signed promptly after the omission is called
to the attention of the pleader or movant. If a pleading,
motion or other paper is signed in violation of this rule, the
court, upon motion or upon its own initiative, shall impose
upon the person who signed it, a represented party, or
both, an appropriate sanction, which may include an order to
pay to the other party or parties the amount of the reasonable
43
expenses incurred because of the filing of the pleading, motion
or other paper, including reasonable attorney fees.
Rule 12.06 Motion To Strike
Upon motion made by a party before responding to a
pleading or, if no responsive pleading is permitted by these
rules, upon motion made by a party within 20 days after the
service of the pleading upon the party, or upon its own initiative
at any time, the court may order any pleading not in
compliance with Rule 11 stricken as sham and false, or may
order stricken from any pleading any insufficient defense
or any redundant, immatezial, impertinent or scandalous
matter.
Rule 41,02 Involuntary Dismissal
(1) The court may on its own motion, or upon motion of a
party, and upon such notice as it may prescribe, dismiss an
action or claim for failure to prosecute or to comply with these
rules or any order of the court.
(2) After the plaintiff has completed the presentation of his
evidence, the defendant, without waiving his right to offer
evidence in the event the motion is not granted, may move for a
dismissal on the ground that upon the facts and the law the
plaintiff has shown no right to relief. In an action tried by the
court without a jury the court as trier of the facts may then
determine them and render judgment against the plaintiff or may
decline to render any judgment until the close of all the
evidence. Ifthe court renders judgment on the merits against
the plaintiff, the court shall make findings as provided in Rule
52.01. (Emphasis added.)
(3) Unless the court in its order for dismissal otherwise
specifies, adismissal under this rule and any dismissal
not provided for in this rule or in Rule 41.01, other than a
44
dismissal for lack of jurisdiction, for forum non conveniens, or
for failure to join a party indispensable under Rule 19,
operates as an adjudication upon the merits.
Rule 52.01 Findings By Court; Effect
In all actions tried upon the facts without a jury or with an
advisory jury, the court shall find the facts speciallly and
state separately its conclusions of law thereon and direct the
entry of the appropriate judgment; and in granting or
refusing interlocutory injunctions the court shall similarly
set forth the findings of fact and conclusions of law which
not necessary for purposes of review. Findings of fact,
whether based on oral or documentary evidence, shall not
be set aside unless clearly erroneous, and due regard shall be
given to the opportunity of the trial court to judge the
credibility of the witnesses. The findings ofa referee, to
the extent adopted by the court, shall be considered as
the findings of the court. It will be sufficient if the findings of
fact and conclusions of law are stated oratly and recorded in
open court following the close of the evidence or appear in an
opinion or memorandum of decision filed by the court or in
an accompanying memorandum. Findings of fact and
conclusions of lax are unnecessary on decisions on
motion pursuant to Rules 12 or 56 or any other motion except
as provided in Rule 41.02
Rule 63.02 Interest Or Bias
No judge shall sit in any case if that judge is interested in its
determination or if that judge might be excluded for bias from
acting therein as a juror. If there is no other judge of the
district who is qualified, or if there is only one judge of the
district, such judge shall forthwith notify the chief justice of
the supreme court of that judge's disqualification.
45
REFERENCED RULES OF MINNESOTA GENERAL
RULES OF PRACTICE FOR DISTRICT COURTS
Rule 115.02 Obtaining Hearing Date; Notice To Parties
A hearing date and time shall be obtained from the court
administrator or a designated motion calendar deputy. A party
obtaining a date and time for a hearing ona motion or for
any other calendar setting, shall promptly give notice
advising all other parties who have appeared in the action so
that cross motions may, insofar as possible, be heard on a
Rule 116 Orders To Show Cause
An order to show cause will be issued only in a case where a
statute or rule of civil procedure provides that such an order
may be issued or where the court deems it necessary to require
the party to appear in person at the hearing.
REFERENCED RULES OF THE MINNESOTA
RULES OF CIVIL APPELLATE PROCEDURE
Rule 103.03 Appealable Judgments And Orders
An appeal may be taken to the Court Of Appeals:
(a) from a judgment entered in the trial court;
+08
Rule 104.01 Time For Filing And Service
An appeal may be taken from a judgment within 90 days after
its entry, and from an order within 30 days after service by the
46
adverse party of written notice of filing unless a different
time is provided by law.
eee
Rule 108.03 Extent Of Stay
When a bond is filed as provided by Rule 108.01, it shall stay
all further proceedings in the trial court upon the judgment or
order appealed from or the matter embraced in it; but the
trial court may proceed upon any other matter included in the
action and not affected by the judgment or order from which
the appeal is taken.
Rule 110.05 Correction Or Modification Of The Record
If any difference arises as to whether the record truly discloses
what occurred in the trial court, the difference shall be
submitted to and determined by the trial court and the
record made to conform. If anything material to either party
is omitted from the record by error or accident or is misstated
in it, the parties by stipulation, or the trial court, either before or
after the record is transmitted to the appellate court, or the
appellate court, on motion by a party or on its own initiative,
may direct that the omission or misstatement be corrected, and
if necessary that a supplemental record be approved and
transmitted. All other questions as to the form and content of
the record shall be presented to the appellate court.
Rule 128.02 Formal Brief
ess
(c) A statement of the case and the facts.The facts must be
stated fairly, with complete candor, and as concisely as
possible...Each statement of a material fact shall be
47
accompanied by a reference to the record, as provided in Rule
128.03.
Rule 128.03 References In Briefs To Record
Whenever a reference is made in the briefs to any part of the
record which is reproduced in the appendix or in a
supplemental record, the reference shall be made to the specific
pages of the appendix or the supplemental record where the
particular part of the record is reproduced. Whenever a
reference is made to a part of the record which is not
reproduced in the appendix or in a supplemental record, the
reference shall be made to the particular part of the record,
suitably designated, and to the specific pages of it, ¢.g., Motion
for Summary Judgment, p. 1; Transcript, p. 135; Plaintiff's
Exhibit D, p. 3. Intelligible abbreviations may be used.
Rule 140.01 Petition For Rehearing
No petition for reconsideration or rehearing of a denial of a
petition for review provided by Rule 117, or of a petition for
accelerated review provided by Rule 118, shall'be allowed in
the Supreme Court.
48
REFERENCED MINNESOTA STATUTES SECTIONS
Minn.Stat., Sec. 336.8-319
Statute Of Frauds [Sale of Securities]
A contract for the sale of securities is not enforceable by way
of action or defense unless:
(a) there is some writing signed by the party against whom
enforcement is sought or by the party's authorized agent or
broker, sufficient to indicate that a contract has been made for
sale of a stated quantity of described securities at a defined
price,
see
(c) within a reasonable time a writing in confirmation of the
sale or purchase and sufficient against the sender under
paragraph (a) has been received by the party against whom
enforcement is sought and the recipient has failed to send
written objection to its contents within ten days after its receipt;
Minn. Stat., Sec. 481.08
Authority
An attorney may bind a client, at any stage of an action or
proceeding, by agreement made in open court or in the
presence of the court administrator, and entered in the minutes
by such court administrator, or made in writing and signed by
such attorney. During any proceeding or action the attorney
may receive money claimed therein by aclient, and within
six years after judgment, upon payment thereof, may
discharge the claim or acknowledge satisfaction of the
judgment; but all such authority shall cease upon the
substitution of another attornev.
49
Minn. Stat., Sec. 513.01
Statute Of Frauds
No action shall be maintained, in either of the following
cases, upon any agreement, unless such agreement, or some
note or memorandum thereof, expressing the consideration,
is in writing, and subscribed by the party charged therewith:
(1) Every agreement that by its terms is not to be performed
within one year from the making thereof,
Minn.Stat., Sec. 588.04
Arrest; Order To Show Cause
In cases of constructive contempt, an affidavit of the facts
constituting the contempt shall be presented to the court or
officer, who may either issue a warrant of arrest to bring
the person charged to answer or, without a previous arrest,
upon notice, or upon an order to show cause, which may be
served by a sheriff or other officer in the same manner as a
summons in an action, may commit the person to jail,
impose a fine, or both, and make such order thereupon as
the case may require.
EXCERPTS OF MEMORANDA,
AFFIDAVITS AND MOTIONS PURSUANT
TO USSC RULE 14.1(h)
PETITIONER'S MEMORANDUM IN SUPPORT OF
MOTION FOR ORAL ARGUMENT
OCTOBER 29, 1993
[PAGES 3 TO 5)
Both the Appellant's expense of the litigation, and the
black balling tactics of the Respondents is shown by their
own Brief. The Respondents’ (Lee Data) Brief refers to
Appellant's expense at page 3, lines 16 to 17, stating, "A
litigation campaign of this kind would be prohibitively
expensive for all but a few extraordinarily wealthy
individuals”. Appellant, however, is not wealthy, and
has suffered an enormous toll due to the Respondents’
continuing prejudicial rule and ethical violations in __ this
litigation. Respondents’ black balling tactics are clear from
their Brief and the supporting analysis of Appellant's Motion
To Strike Respondents’ (Lee Data's) Brief served October
25, 1993, and filed with the Court on October 26, 1993. The
Respondents’ Brief follows a pattern of willful disregard for
court rules and court orders in the Trial Court. (See a
partial discussion and documentation of such conduct at A-
141 to A-361, Vol. II; A-363 to A-394, Vol. Ill, and
Apls.Mot.Strk. dated October 25, 1993.)
The cost of litigating against such tactics is obvious to
Respondents, according to their own brief, and should be clear
to the Court. The Respondents argue that Appellant has only
been able to continue this costly litigation because he is an
51
attorney, giving him an unfair advantage over Dorsey &
Whitney and Lee Data, a public company with a net worth of
at least $15,000,000, (see Page .Brf. p. 3,1. 18 top. 4, 1. 1.)
The toll on Appellant has included a substantial financial
outlay. The Appellant has been required to retain three
different attorneys in this matter at significant expense for a
duplication of effort. The Respondents have pointed out
Appellant's cost for such duplication of effort in nearly
every memorandum, and at every hearing they have attended
since the beginning of the present case, (ice: see Rsps.Brf. p. 8,
1. 13 to p. 9). The Respondents’ have made that argument
to prejudice Appellant's case, implying the attorneys quit for
lack of confidence. There is no evidence on the record to
support that suggestion. However, in response, the Appellant
has been forced to document the nature of those privileged
attorney -client relationships. Appellant's counsel, Mr. Lentz,
withdrew because of a conflict of interest that arose between
his law firm and Lee Data. Mr. Albright's services on my
behalf were suspended, but he was fired by his own law firm,
not by me. (See discussion at A-181, 1. 12 to A-182, |. 10;
esp. A-181 Is. 24-25.) Each change of counsel required
payment of a fee or a retainer, and the expense of a
duplication of effort for cach to become familiar with the case.
The fact that Appellant is an attorney and able to
represent himself pro se, is not a financial advantage. All of
Appellant's effort in this litigation have taken away from his
time and ability to ear a living. The Respondents’ black
balling tactics have required Appellant to spend considerable
time and effort defending unsupported accusation, hearsay,
and unscrupulous conduct by Respondents’ counsel in
violation of the rules of professional responsibility, court
orders and rules of civil procedure. Dorsey & Whitney uses
such litigation strategy knowing that individuals are driven to
financial hardship defending against their unscrupulous conduct.
52
PETITIONER'S MEMORANDUM IN SUPPORT
MOTION TO STRIKE THE BRIEF OF RESPONDENTS'
DATED OCTOBER 25, 1993
(PAGE 15 TO 17|
(2) If Respondents’ Brief does violate MRCAP, Rule
128.02, whether such violations are prejudicial to the
Appellant so as to require corrective action by the Court?
Matter that is not part of the record should not be printed
in briefs of counsel or comment made thereon, Sargent v.
Bryan, 1926, 166 Minn. 45,207 N.W. 178. Respondents’
use of inadmissible material misrepresentation, and other
violations of the rules is so intertwined with their argument
that it cannot be stricken without rewriting their entire brief.
There are more than 60 sections of the “Argument” of
Respondents’ Brief that discuss or incorporate inadmissible
references, (see refs. at page 3, prg. 3, to page 4, above). The
violations are extensivelyprejudicial to Appellant, and are an
example of Respondents’ tactics in the Trial Court as well,
(see RA 58-78; A-283; A-141 to A-203).
The rules of civil and appellate procedure are in place
for a reason. Respondents’ have severely prejudiced
Appellant by clearly violating those rules throughout this
case. Appellant should not be required to prove how each
violation has been prejudicial to his case. In sum, it is the
cumulative effect of all inappropriate references and rule
violations that have prejudiced the courts decisions.
The hyperbole, misrepresentation and other rule violations
by Respondents’ have biased both the Trial Court and this
Court. An example of such bias is Chief Judge Anderson's
dismissal of Appellate Court Case No: C1-92-1292. In
determining Appellant's motion filed September 8, 1992
criticizing similar conduct by Respondents’ in connection with
53
that appeal, Chief Judge Anderson did not review the file or
even the Court's prior order in the case, (compare the
Court's Orders filed September 25, 1992 and October 9,
1992 with the Court's Order filed September 1, 1992).
Dorsey & Whitney's attorney then notified the Court's staff
counsel to correct Judge Anderson's error on the record.
Without notifying Appellant, or reviewing the Appellant's
motion, Judge Anderson issued a corrective order filed October
21, 1992 and an apology letter dated October 19, 1992. It
was clear from the September 25 and October 9 orders that
Judge Anderson had not reviewed the file in determining
Appellant's motion filed September 8, 1992. The corrective
action taken was based on indirect ex parte communications
by Respondents’ counsel. From the record it appears as
though Judge Anderson did not consider Appellant's
motion upon an_ informed review of the file. This example
proves on the record that the courts are influenced by the
wrongful conduct and rule violations of Dorsey & Whitney.
Since the Respondents’ Brief cannot be edited to strike
wrongfully submitted material, the prejudice to Appellant's case
can only be avoided by striking Respondents’ entire brief.
CONCLUSION
Respondents' Brief contains innumerable references to
documents and assertions not on the record. The decisions
of the Trial Court have not been based on admissible
evidence, but have been largely influenced by the hearsay
affidavit testimony of Respondents’ attorneys as well as
by their similar conduct in violation of the rules.
There is so much inadmissible material in Respondents’
Brief that it is clear their rule violations were intentional.
The prejudicial violations of Respondents' Brief cannot be
corrected in any way other than by striking the Brief in
54
its entirety andsanctioning § Respondents for Appellant's
costs in preparing and filing this motion.
oe
PETITIONER'S REPLY MEMORANDUM IN
SUPPORT OF MOTION TO STRIKE
DATED NOVEMBER 4, 1993
[PAGES 8 TO 10}
In connection with Respondents alleged statement by
Judge Burke that the litigation would have been dismissed due
to "Appellant's irrefutable failure to pay the sanctions the court
assessed against him", is not an accurate quote, (see A-19, Is.
10-12). Judge Burke did not find the failure "irrefutable".
Appellant notes that rsp black-balling tactics influenced the
sanctions which were not justified; Appellant was not given
timely notice of the Trial Court's orders to pay sanctions;
Appellant's attorney, whose motives are questionable, was
responsible to notify the apl so that timely payments could be
made; Appellant's attorney’ willfully failed to make
payments that appellant did direct him to make; Appellant was
not given a hearing regarding his own actions and the Trial
Court assumed he had knowledge and was responsible because
Appellant is an attorney himself, (an attorney has the right to
hire another atcorney to take up his cause, and an attorney
does not have a lesser responsibility to a client simply because
the client is also an attorney, and as Respondents argue,
Mr.Greenberg had control of the litigation at that time);
Respondents had not allowed Appellant to complete his
discovery and the Respondents agreed to defer Appellant's
obligation to pay sanctions until after the completion of
discovery, (see Rspdts. Ginsburg Ltr. dated September
3, 1991, C1-92-1292, A-76. Please read that letter in
combination with A-74, which makes that meaning
absolutely clear, giving Appellant every right to rely on Mr.
Ginsburg's representation and the right to relief on the
grounds of promissory estopel.); Appellant did make every
possible effort to pay sanctions on time, he paid his
attorney and believed in good faith that sanctions were being
56
paid when due because of the documented deferals agreed to in
writing by the Respondents attorney, Mr. Ginsburg, (see
C1-92-1292, A-36 to A-38, 1. 4; and A-55 to A-57,1. 2); the
Respondents refused Appellant's offer to set the dismissal
aside and accept payment of sanctions; and the Trial Court
found on its own volition that an oral contract was formed
on terms putting the agreement within the Statute of Frauds
and therefore such sanctions are not enforceable against
Appellant.
All of the above arguments apply to the remainder of
Respondents’ opposing memorandum, and there is ample case
law to support Appellant's position.
The appeal court is limited to consideration of matters
appearing on the record, and additional materials are stricken
on motion, (Chizmadia v. Smilev's Point Clinic, 428 N.W.2d
459,(Minn.Ct.App. 1988); Safeco Ins. Co. v. Diaz, 385
N.W.2d 845, (Minn.Ct.App. 1986). In Merle’s Constr.Co. v.
Berg, 442 N.W.2d 472, (Minn.Ct.App. 1989), atrial judge's
later affidavit was stricken on the court's own motion.
57
PETITIONER'S REPLY BRIEF
DATED OCTOBER 12, 1993
[PAGES 5 TO 18]
A. Whether The Trial Court Correctly Ruled That The
Settlement Agreement Is Enforceable As A Matter Of Law.
1. Whether Appellant Waived His Right To Raise
The Statute Of Frauds.
Respondents argue at page 27 that new issues may not be
raised for the first time on appeal. This case is
distinguishable from Respondents’ case cites on several points.
There are many exceptions to the rule relied on by
Respondents. First, an Appellate Court may base its decision
on a_ theory not presented to or considered by the Trial
Court where the question raised for the first time on appeal is
plainly decisive of the matter appealed, on its merits, where the
facts are undisputed, and where there is no possible
advantage or disadvantage to cither party in not having had a
prior ruling by the Tnal Court on the question. (Holen_v.
Mpls. St. Paul Metro. Arprts. Comms., 250 Minn. 130, 84
N.W.2d 282, (1957); Christianson v. Hager, 242 Minn.
41, 64 N.W.2d 35, (1954); Chicago M. & St. P. Ry. v.
Sprague, 140 Minn. 1, 167 N.W. 124, (1918), Dunnell's
Minn, Dig., 4th Ed., Vol. 2, p. 342, Sec. 5.02.) In this case,
application of the Statute of Frauds is plainly decisive of the
matter appealed, on its merits, and the facts putting the alleged
Settlement Agreement within the Statute of Frauds are
undisputed. Respondents have not identified any prejudice
through application of the Statute of Frauds by the Court on
this appeal. They have not indicated any additional facts
that would have been raised to defeat the Statute of Frauds in
the Tnal Court. (Holen, Id.) The rule that an issue be
determined first by the Trial Court is not applied where it
58
conclusively appears, as here, that the point urged by the
Respondents could not have been urged, or avoided by other
evidence, (Bauman v. Metzger, 145 Minn. 133, 176 N.W. 497,
(1920).
The Appellate Court has a duty to, and on its own motion
may, consider and determine a case on the ground of
“illegality”, although such ground was not presented to or
considered by the Trial Court, if such illegality is apparent
on undisputed facts and is in clear contravention of public
policy, and if a decision thereon will be decisive of the
controversy appealed, on its merits, (Atwood v. Holmes, 229
Minn. 37, 38 N.W.2d 62, (1949); Hart v. Bell, 222 Minn 69,
23 N.W.2d 375, 24 N.W.2d 41):
AUS VW ic » OLE LY ndisp A VLD, LK
judicially bound to know.” (Atwood, Id., p. 66.)"
Mill Pond Towers, Id., does not apply to the present case
because it did not involve any allegation of a controlling
statute or illegality. In that case the appellant offered a new
set of evidence not on the record and a new legal theory. In
Northwestem Natl Bk. Id, the appellant raised new
evidential questions on appeal, after a trial.
When a trial court ignores or overlooks a legal theory,
it may be considered for the first time on appeal where the
trial court was fully informed of undisputed facts on the record.
See Hart, Id., p. 65-66:
"It is an elementary and basic requirement of all just
procedure that before a litigant, in the interest of the public
welfare, is deprived of rights he claims to exist, caution
59
should be exercised to insure that he has not been, and will
not be, thereby denied an opportunity to present his case
with respect to illegality.” (Hart, Id., 23 N.W.2d 375, 379.)"
In this case there has not yet been a trial, Appellant has
properly and timely asserted his claims of illegality,
statutory limitations, and misconduct. Undisputed facts and
the findings of the Trial Court put the settlement document
squarely within the Statute of Frauds. Failure to apply the
Statute of Frauds is a clear contravention of public
policy, and application of the statute is conclusively
determinative of the matter appealed, on its merits. The
Appellate Court has a duty to review the facts and apply the
Statute of Frauds in this case. Respondents’ cases do not
change the analysis.
Here, no pleadings were required as to the Statute of
Frauds. Even if pleadings had been required on the issue,
under Minnesota decisions, and the weight of authority, it is
clear that the Statute of Frauds need not be pleaded specially.
It may be raised by a general denial, (Bruder v. Wolpert, 178
Minn. 330, 227 N.W. 46, 49 Am.Jur, Stat.Frauds, Sec. 603,
Annotation, 158 A.L.R. 113; Borchardt v. Kulick, 48
N.W.2d 318, (1951)). Appellant immediately and consistently
denied the formation of any contract whatsoever as soon as he
learned of Respondents’ intent to claim that a _ written
settlement agreement had been formed. Appellant's November
27, 1991 letter to Judge Burke was certainly sufficient to meet
the requirement of a general denial. Altomare and
Laserage Technology Corp., cited by Respondents at page 27,
lines 19-24, of their brief do not apply as they are pulled
from foreign jurisdictions on issues settled in Minnesota and in
our federal circuit. Those cases have to do with a party's
responsive pleadings asserting the Statute of Frauds.
A more significant flaw in Respondents’ argument is
that, based on the allegations and arguments of Respondents,
60
Appellant was not required to raise the Statute of Frauds in
the Trial Court. Respondents argued consistently that there
was only a written contract. The Respondents’ never argued
that an oral contract had been formed. Respondents have
always argued that the oral evidence they submitted was
only shown to describe the circumstances under which a
written agreement was executed by Mr. Greenberg, (see
Rsp.Brf., p. 33, 1. 10-15). The Appellant denied the
existence of any contract and objected to evidential
submissions of an agreement, (see Pits Sh.C.Ord., A-363,
with attached Mot.Strk.; and Plits.Resps.Defs.Mot.Strk, A-
141). The importance of these facts procedurally is that the
Statute of Frauds did not become an issue in the Trial Court,
and could not have become an issue until the assertion of an
oral contract. The Trial Court had before it only the question
as to whether the Settlement Agreement draft was a written
agreement. Because Respondents never asserted an oral
contract, but only that a signed written contract had been
formed, the Statute of Frauds was not relevant. shat is
because the Statute of Frauds only prevents the enforcement of
oral contracts in certain instances. The Trial Court applied its
own law to conclude that an oral contract was formed, and
could just as easily, and more properly on the facts before it,
have ruled that the Statute of Frauds applied to prevent the
enforcement of an oral contract. When the Trial Court held
in its final order, on its own initiative, that an oral contract
was formed, the Statute of Frauds became an issue, but the
Trial Court simultaneously “closed the record” preventing
the issue from being argued further. A party is entitled to
objectto evidence ofan oral contract and raise the Statute of
Frauds after all the opposing party's evidence has been
presented at trial, (see discussion in Borchardt, Id.)
The Borchardt case discussion, cited and relied on by
Respondents is distinguishable in many respects. The
plaintiff, asserted only an oral contract with terms putting
it within the protective provisions of the Statute of Frauds, and
61
the defendant admitted that an oral contract for employment
was formed. In Borchardt the court held that the defendant
waived her defense of the Statute of Frauds because of her
admission of a contract and her failure to object to assertions
of an oral contract. (Borchardt, Id., p. 327.) The Borchardt
case was appealed after a jury trial, (Appellant has not had a
trial); the defendant accepted, without objection, jury
instructions that allowed the jury to find an oral contract,
(Respondents did not assert an oral contract); and, the
defendant admitted that an oral contract was formed,
(Appellant has consistently denied the existence of any
contract).
Where the record shows there was no basis in law for the
theory argued at trial, it will be disregarded in determining
the appeal. (Bartholet v. Berkness, 291 Minn. 123, 189
N.W.2d 410, (1971); Borchardt, Id.) The Respondents argued
only that a signed written contract was formed. There is no
theory of contract law supporting that argument, based on
the fact allegations made by Respondents or found by the
Trial Court. In applying a theory of law, the Statute of
Frauds is compelling. The court will pass on a contention
not raised at trial where it will undoubtedly arise on a retrial
that is rendered necessary by other errors, (Christianson, Id.).
Even ignoring all of the above points, Respondents’
argument still fails because all necessary legal aspects of
the Statute of Frauds were identified and raised in the Trial
Court. The Trial Court simply chose to ignore the issue.
Appellant argued extensively in his memorandum of August 4,
1992, that the terms of the proposed settlement offer required
a writing signed by Appellant. (Apls.Memo., Aug. 4, 1992, p.
12, 1. 20-23; p. 12, 1. 26 to p. 13, 1. 1-29; p. 14, 1. 20-25; p.
15, 1. 10-16, p. 16, 1. 1-12; p. 16,120 to p. 18, L 3.)
Appellant's, "Memorandum And Affidavit In Response To
Defendants’ Motion To Strike", Id., discusses the consequence
of Respondents’ failure to comply with the Statute of Frauds,
62
(A-167, prg. (e), esp. 1. 20-28, Vol. II). Cases reviewed by the
Trial Court discuss the relevance of the Statute of Frauds to
settlement agreements and its restrictions. The Trial Court's
last memorandum indicated that the Bergstrom case was
carefully reviewed in formulating an opinion. That case
distinguishes situations covered by the Statute of Frauds, (see
Bergstrom, Id.,p. 932 and Ftnt. 7). The Statute of Frauds
argument is properly before this Court.
2. Whether The Statute Of Frauds Applies To This Case.
Respondents assert that the Statute of Frauds does not
apply to this case arguing that it does not exist to prevent a
contract by fraudulent means. The Respondents have never
alleged any facts to support such contention of fraud by
Appellant. At all times prior to the Trial Court's final ruling
the Appellant denied the existence of any contract, oral or
written, meaning that Respondents could have put their
Settlement Agreement claim aside and reactivated their
counterclaims, sanctions and defenses. Cases showing evasion
deal with situations where a party has deliberately sought to
be misleading, and then disclaim his obligations by
asserting the Statute of Frauds. The courts uniformly
recognize that, where a party denies both an oral and written
contract, as Appellant did here, application of the Statute of
Frauds may have harsh consequences as to the party seeking
to enforce the contract. Appellant explained those
consequences to Respondents and the Trial Court by way
of Plaintiff's Response To Defendants’ Motion To Strike,
(see A-167, prg. (¢), and above foomote 6), even though the
Statute of Frauds was not in issue at that time. Appellant
Promptly instructed his attorney, the very next available
day after negotiations had been initiated, to terminate those
negotiations, (Apis.Ltr, Oct. 14, 1991, RA 160-162).
Asserting the legal right to the protective provisions of the
Statute of Frauds certainly does not make that party a
“fraud”, as Respondents argue.
63
Next Respondents claim there is a general consensus that
a Settlement Agreement will not be impaired by the Statute of
Frauds. None of Respondents’ cited cases support that
assumption. The leading case cited by Respondents is
Bergstrom, Id. That case specifically recognizes that the
Statute of Frauds applies to settlement agreements, (see
Bergstrom, Id., discussion at p. 932, and Ftnt. 7). The
same rationale applies in cases decided by Minnesota courts,
Ghostley, Id., Theis, Id., Jallen, Id.
The Statute of Frauds is a paar of contract law,
the law of this case. (See Tri. Crt.Memo., A-422, L. 4.9:
also Beach, Id.; Hillmever, Id; and Fulgence v. J. Ray
McDermott & Co, 662 F2d at p. 1209 discussed in
Bergstrom, Id., p. 932.)
The decision in Qwens, a New York case cited by
Respondents, has to do with general obligations law. In that
case Owen's husband, an attorney, negotiated a settlement
agreement which he accepted and Owens agreed to and
ratified. It was her attorney who later objected to the
agreement. The facts show that Owens personally agreed to the
contract. The other cases cited by Respondents deal with
the issues of "authority" and whether a settlement agreement
can be oral or written, not whether a settlement agreement
withinthe Statute of Frauds may be oral or written. None of
Respondents’ cited cases discuss the Statute of Frauds, and they
do not support Respondents’ argument. In Austin, the
Statute of Frauds was not in issue. The undisputed evidence in
the case showed that the agreement was reached. No
evidence was submitted to refute that an agreement was made.
No evidence was submitted on the record pertaining to a
Statute of Frauds argument, nor was the doctrine raised by
action or defense at trial or on appeal. In Johnson the
64
parties personally admitted their assent to an oral agreement,
that fact was undisputed and the Statute of Frauds was not
raised as an issue. In Skalbeck the settlement was consented to
on the record, and no Statute of Frauds issue was raised in
the trial court or on appeal. Similarly, the Rosenberg case
has nothing to do with the Statute of Frauds. The Statute
of Frauds was not raised as an issue at trial or on appeal.
Next, Respondents argue that the provisions of the
settlement form do not come within the Statute of Frauds. The
Statute of Frauds requirement in question applies to contracts
that cannot be performed within one year according to their
own specified terms, such as the Settlement Agreement form
provisions in this case. The restriction does not apply to
contracts that by their own terms can possibly be performed
within one year, even though the parties have not
contemplated such performance. (Dunnell's Minn. Dig., 2d
Series, Vol. 17B, p. 264.) Dunnell’s discussion and the
discussion of the cases make the application clear. For
example, where a contract for employment specifies a term
of "life time employment", the agreement term can be
performed within one year, (ie: by the death of the
employee), and the agreement is not within the protective
provisions of the Statute of Frauds. But, where a contract
for employment specifies a term of one year beginning the day
after it is made, the contract cannot possibly be performed
within one year by the contract's own terms, and the
agreement falls within the protective provisions of the
Statute of Frauds. (See the discussion in Borchardt, Id.:
Lally_v. Crookston Lumber Co., 85 Minn. 257, 88 N.W.
846; Roaderick v. Lull Engr’s. Co., 296 Minn. 385, 208
N.W.2d 761.)
In this case the provisions of the Settlement Agreement
provide specific terms of more than five years, and it is
squarely within the Statute of Frauds. Respondents argument is
misleading as to the provisions of the draft Settlement
65
Agreement that put it within the Statute of Frauds, and those
that specifically require Appellant's personal execution of the
form.
Paragraph 6 states:
"...meither he [Appellant] nor anyone acting on_his behalf will
acquire any ownership interest in Lee Data Corporation
for the period commencing September 27, 991, and
continuing through December 31, 1996."
The Respondents misrepresented the clause at A-032, line
8, as being limited to Appellant only. The true provision is
much broader and can not be extinguished by Appellant's death.
The provision prevents Appellant from establishing a
trust, will or other legal vehicle to purchase Lee Data stock on
his behalf within the firm specified five year term.
Paragraph 5 states:
"Mr. Bergmann understands and agrees that by executing
this Settlement Agreement and General Release, he waives any
future claim to employment with Lee Data...at no time after
execution of this ...Agreement...will he ever seek employment
with Lee Data...". The emphasized language, deleted
by Respondents, highlights the required personal nature of the
execution and is significant in combination with the fact that
Respondents drafted the agreement form to included this
requirement.
The time period is specified by paragraph 5 as, “at no
time after execution.". That time period gives perpetual
duration to the settlement document leaving it unenforceable as
a contract with a mandated perpetual term, not an indefinite
term.
66
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All cases cited by the Respondents support the above
analysis. In Ecklund, an agreement with a term designated as
the lifetime of an employee was not within the Statute of
Frauds. In Tomson, (Rsp.Brf., p. 30), the question was
whether a contract provision requiring "confidentiality for
the rest of the parties lives" put the agreement within the
Statute of Frauds. The court's decision was consistent with
the above case law and Appellant's argument. The agreement
was not within the Statute of Frauds because it was capable
of performance within one year under its own terms.
Kuykendall, (Rsp.Brf., p. 30), is based on similar facts and
the court properly made the same decision.
Respondents go onto argue that Worwa, (Rsp.Brf., p.
31), a case cited by Appellant, has no application to
restrictive covenants. In Worwa, the plaintiff filed a motion
to amend his complaint to allege the existence of an oral
covenant not-to-compete with the defendants for a term of 5
years, within a 2 mile radius, for a price of $30,000. (Worwa
v. Solz_ Enterprises, Inc., 238 N.W.2d 628, (1976), p. 630,
prg. 2.) The court held that, by its own terms the alleged
oral contract could not be performed within one year and that
it was unenforceable under the Statute of Frauds. (Worwa,
Id., p. 631, 3rd prg.)
Clearly the provisions of the Settlement Agreement draft
designating a definite term beyond one-year put it decisively
within the Statute of Frauds as a matter of law.
Last on this point, Respondents argue that the settlement
document does not come within, Minn.Stat., Sec. 336.8-
319, which deals with the sale of securities. Respondents allege
that the document's prg. 2, which would require the transfer
of Appellant's Lee Data stock for consideration, is not a "sale"
under 336.8-319. Minn.Stat., Sec. 336.1-201(32), included
as part of Article 8 pursuant to Minn.Stat., Sec. 336.8-
102(6), defines a securities sale purchase as any “transaction
67
creating an interest" in such property. The settlement draft
purmorts to transfer an interest in Appellant's stock, which
would clearly be a "sale" of securities within Minn.Stat., Sec.
336.8-319. An application of this is shown in Ryan v. Ryan,
193 N.W.2d 295, cited in Rsp.MacRae'sBrf., pg. 9. The
parties recognized the settlement agreement transfer of
stock as a "private placement” sale.
The settlement draft is not enforceable against Appellant
because, even if a signed agreement had been made, the
form does not specify the quantity of stock to be sold.
Minn.Stat., Sec. 336.8-319(a), requires a signed writing
"sufficient to indicate that a contract has been made for sale of
a stated quantity of described securities at a defined or
stated price". It is essential that the quantitiy be stated.
Clearly the quantity is not stated, and the statute requirements
are not met.
3. Whether The Settlement Agreement Form Meets The
Requirements Of The Statute Of Frauds.
The Respondents argue that Appellant's attorney gave
his “approval” to the Settlement Agreement form, (see
Rsp.Brf., p. 32, Ftnt. 15, alleging that
"Mr. Bergmann's agent gave his approval to the settlement,
both orally and in writing"). Respondents then argue that Mr.
Greenberg's notation of "approval" operated as a
memorialization of “acceptance” of the document. Mr.
Greenberg's notation, as he confirmed in his affidavit nearly
one year later, (AGG.Aff., Id. pg. 2, prg. 8), was his
manifestation of "review", but not an "approval" and certainly
not an “acceptance”. An “approval” is merely the act of
confirming some act done by another, it is not an
acceptance, (Black's Law Dictionary, Roonev_v. South Sioux
City, 111 Neb. 1, 195 N.W. 474, 475).
68
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In this case, Mr. Ginsburg drafted the Settlement
Agreement document as Respondents’ counteroffer,
(Gins.Aff., Id.), to Appellant. He then gave the document to
Mr. Greenberg who, seeing it for the first time, reviewed it
for Appellant's acceptance, which he said he could not obtain
until October 18, 1991. On October 14, 1991, Appellant
revoked any authority that Mr. Greenberg may have had to
negotiate a settlement agreement, by meeting with him
personally to limit his authority, and by delivering Appellant's
letter of the same date to document that instruction, (see RA-
160).
"Signing", or "subscribing" to an acceptance, as the
Statute of Frauds requires, may be indicated in different ways,
as long as there is a clear manifestation of acceptance.
Here, the document in question required a carefully
defined method for “subscribing” to an acceptance.
Paragraphs 5, 7, and 10 express the requirement that
Appellant personally sign the document to execute it. The
signature lines confirm the express terms. Respondents
drafted the document and any inconsistency or ambiguity must
be construed against them, but it is clear that Appellant's
personal signature was required by the documents express
terms. The notation of Mr. Greenberg cannot operate as a
memorial of acceptance as a matter of law. The cases cited by
Respondents do not change this. In Beach there was a clear
and undisputed “acceptance” on the record. There is no
indication that Beach or BA Leasing involve a Statute of
Frauds issue. (Rspdts.Brf., p. 33.)
The Respondents argue that parol evidence is admissible
to "explain the circumstances surrounding and leading up to
the agreement". Parol evidence is admissible to explain a
particular term or condition, not to prove the existence of an
agreement, not to change a term, not to add a term, and not to
delete a term. None of the cases cited by Respondents
change the rule. MacDonald and Greer, (Rsp.Brf., p. 34),
69
confirm Apl's. position. In Clark, (Rsp.Brf., p. 34), the court
considered the rule that proceedings of a public body may not
be impeached or contradicted by parol evidence because the
dependability of the substance of the records must be insured,
(Clarx, p. 562-563). Clark has absolutely nothing to do
with, the applicability of parol evidence to a contract.
Respondents quote the Trial Court in arguing that, if Mr.
Greenberg had authority to enter into an oral agreement,
a settlement was "“perfected...before anything had been
reduced to writing", and lack of assent to the written document
by Appellant was therefore "immaterial". (A-419, Rsp.Brf., p.
35.) That is illogical in view of the terms of the alleged oral
agreement, and in light of the Statute of Frauds. According to
Respondents and the Trial Court, the alleged oral terms were
identical to the document terms. (That has to be so asa
matter of law.) Since the alleged oral contract put it within the
Statute of Frauds, an oral agreement could not "perfect"
a settlement agreement. Similarly, since the alleged oral
terms _ required Appellant's personal assent, an _ oral
agreement could not have _ been “perfected" without it.
Nor does it make any difference whether Mr. Greenberg
had express, implied, apparent or no authority, since he chose
not to exercise any authority he may have had.
Respondents argue that in Upton Mill & Elevator Co.,
"there was no writing, notation or signature of any kind...".
In that case the court recognized the typed company name
as a signature, the form was completed by its employee, but
final acceptance by an officer was required by the order form
terms. The Upton case is on point.
Dataserve_ Equip., Rural American Bk., and the other
contract cases cited by Appellant are all relevant for the
purpose of explaining the meaning of a “signature” and
"acceptance within the terms of a document". Dataserve is
squarely on point. Respondents argue that Rural American
70
Bk. is not relevant because it deals with credit agreements.
Austin Farm Equip., relied on heavily by Respondents, also
deals with credit agreements.
Last on this question, the Respondents have chosen not to
recognize the meaning of the document's paragraph 7,
regarding modifications, (Rsp.Brf., p. 36). Respondents
drafted the clause. The paragraph precisely provides the
requirements for executing the related "Stipulation For
Dismissal", which was not prepared in the manner prescribed,
and is also controlling as to how the document's signature
and acceptance provisions must be modified. The
document's terms did not allow an acceptance by Mr.
Greenberg. To allow his acceptance required a modification in
accordance with paragraph 7. Respondents admit that the
document terms were not modified, (Rsp.Brf., p. 36, |. 7-9),
therefore, the "Stipulation For Dismissal" is ineffective, and
the notation by Mr. Greenberg cannot operate as an acceptance
under paragraph 7.
‘PAGES 24 TO 25)
E. Whether The Trial Court Properly Dismissed The Case
Based On Three Independent Reasons.
Since a contract enforceable against the Appellant was not
formed, the dismissal is invalid. The dismissal is also invalid
under paragraph 7 of the written document which the Trial
Court specifically enforced because it required the
individual parties to personally sign that undertaking.
The Trial Court's finding that the case could have been
dismissed for noncompliance with its ordered sanctions is
inconsistent with the Statute of Frauds and the courts
findings that an oral agreement was formed releasing
sanctions, the parties prior understanding that sanctions
were not required to be paid until after Appellant's
completion of the deposition of Ms. MacRae, (which to this
date has not been completed), and Appellant's right to a
hearing as to attorney misconduct.
F. Whether Appellant Presented Evidence To Support His
Claim Of Attorney Misconduct.
Appellant was denied his right to a hearing on these issues,
and he did provide uncontested evidence of misconduct
by Respondents’ attorneys. (See Pilts.Memo.Aff. in
response to Defs.Mot.Strk., A-141, Vol. Il, esp: pages A-
190 to A-196, concerning violations of the court's
Protective Order; pages A-187 to A-190, conceming the "White
Notes"; pages A-149 to A-157 and A-168 to A-187,
concerning misrepresentation.) | Appellant was denied his
right to compel Respondents’ counsel's appearance at a
hearing on these facts, and he was denied his right to compel
their appearance on his Show Cause Order Application.
72
PETITIONER'S APPELLATE BRIEF
DATED AUGUST 30, 1993
[PAGES 45 TO 48}
Ill. Whether the October 1, 1991 dismissal of the case
should be vacated and Appellant granted special relief in the
interests of justice due to attorney misconduct, an abuse of
discretion by the Trial Court, and the appearance of judicial
misconduct?
Argument.
Attorney misconduct and judicial prejudice is apparent in
this case. Appellant's documentation of Respondents attorneys’
misconduct is provided by was of Appellant's, "Plaintiff's
Response To Defendants’ Motion To Stike", (App.Vol. IL,
beginning at A-141; also see Apls.Mot., Nov. 27, 1991 with
Apls.Aff., Jan. 10, 1992 and Apls.Supp.Aff., Jan. 13, 1992).
Appellant renewed his request for Trial Court action as to
attomey misconduct for the fourth time by serving his
Application For Order To Show Cause on the Trial Court
November 26, 1992. (An acknowledgment of service of the
Aplication was provide by the Trial Court office on that
date.) The Application further supports allegations of
misconduct and it is included with the Appendix beginning at
page A-363, Volume III.
The Trial Court refused to review Respondents attorneys’
misconduct on all four motions. Clear evidence of
prejudicial misconduct is documented byAppellant's
memoranda and affidavits, (Id.). At the hearing held January
14,1992, the Trial Court cut off Appellant's offer of
evidence including the introduction of the acknowledged tape
recorded statement of Appellant's attomey, (Trscrpt., at A-
124), which contained information in conflict with the
unswom statements that Mr. Greenberg made at the
73
hearing pursuant to a question raised by the Trial Court. At
that hearing the Trial Court made its bias clear when Appellant
was told that his allegations of bribery and misconduct
were merely allegations of what good attorneys do, and that is
the way the American system of justice operates, (see A-
460 to A,-463). Appellant is entitled to review of his
motions and applications concerning prejudicial misconduct
in this case: "When disobedience of an order of court is
shown, [Respondents' counsel's violation of the Protective
Order], a prima facie case of contempt is made, and the
burden is then on the person charged with contempt to show
that it was not in his powei to obey." (Meisner v. Meisner,
(1926), 220 Minn 559, 20 NW2d 486; US. v._ Rylander,
(1983), 460 US 752.)
If the dismissal is set aside and Appellant is allowed his
discovery and a trial, the Appellant will show that
Respondents attorney Mr. Ginsburg and Appellant's own
attorney Mr. Greenberg colluded to impune Appellant's
character and conduct by way of their misrepresentations,
2nd = material omissions), before the Trial Court, (see Apls.
‘viotions, Responsive Papers, Application and Affidavits,
Id.). The Trial Court's resulting oppressive sanctions were
tatended to force Appellant to quit the case, or to bring about
an involuntary dismissal. Appellant will show that those
attorneys colluded to achieve the same result by other means.
Appellant will show that Mr. Ginsburg, with the
assistance of Mr. Greenberg, bribed two witnesses whose
depositions, taken by design in the presence of Appellant,
contained manufactured misrepresentations that were
intended to cause Appellant to have an emotional breakdown
and give up his case against his will. The witnesses who
testified falsely, are Diane Hanson, against whom Appellant
has obtained a District Court judgment for her part in Mr.
Ginsburg's strategy, and Appellant's own psychologist,
Mindy Mitnick. Appellant will show that Ms. Mitnick
74
knew Appellant's weaknesses and vulnerablities and that she
exploited that information with the intent to cause
Appellant's emotional breakdown in exchange for a bribe.
A stipulation for settlement may be set aside or avoided upon
a showing that one of the parties was fraudulently induced
to enter into the agreement, (Keller v. Wolf, (1953), 239
Minn. 397, 58 NW2d 891; Wilson's Inc v. Twin City Frieght
Inc., (Minn.Ct.App. 1985), 378 NW2d = 117).
Misrepresentation as to the validity of a claim would also
defeat a compromise, Vv
(1956), 247 Minn. 88, 76 NW2d 492). Misrepresentations
will defeat a compromise even though they are made in good
faith and not witha design to deceive or defraud, (Becker v.
Messner, (1928), 175 Minn. 471, 221 NW 724). A
compromise may be attacked collaterally on the ground that it
was unauthorized and fraudulently entered into by an
attorney, (Albert _v. Edgewater Beach Bldg. Corp., (1944),
218 Minn. 20, 15 NW2d 460. Where there is a dispute as to
whether a settlement was reached, it is ordinarily for the trial
court to determine what the facts are and the matter is
appropriate for the jury to consider, (Jallen, Id.; Mullin v.
Minkel, (1929), 177 Minn. 42, 224 NW 255). Where
through fraud, mistake, undue influence, or duress, either offer
Or acceptance is not the genuine contractual consent of a
party, the law allows him to avoid the contract, (State v.
Bucholz, (1926), 169 Minn. 226, 210NW 1006).
Here, the actions by Mr. Ginsburg, and others wrongfully
influenced by him, caused a “duress”. (See Wise v. Midtown
Motors, (1950), 231 Minn. 46, 42 NW2d 404.) Both the
duress and the provoking misrepresentations and misconduct
by counsel compel vacating the dismissal, allowing
Appellant's discovery and a trial on the facts and issues.
md eee ee
PETITIONER'S MEMORANDUM AND AFFIDAVIT IN
RESPONSE TO DEFENDANTS’ MOTION TO STRIKE
DATED NOVEMBER 19, 1992
[PAGES 9 TO 17)
II. MISREPRESENTATION AND PERJURY
A. Misrepresentations Contained In Dorsey & Whitney's
Papers Served August 19, 1992 And Related To Unlawful
Disclosure Of Plaintffs Confidential Records, And Case
Records, For Purposes Of Bribery And Fabrication Of False
Testimony.
Dorsey & Whitney's papers served August 19, 1992 and
supplemented with Ginsburg's signed affidavit served
September 4, 1992 contain material inconsistencies and
Maki represents under her signature that Defendants
provided my confidential records to Diane Hanson in
compliance with Hanson's subpoena, on or before August
26, 1992, one month prior to Ginsburg's taking of
Hanson's deposition. (See Gins.Aff., Exh 1, the “Hanson”
subpoena.) Maki falsely states that Hanson's attorney did not
“rescind” that subpoena, (Defs.Memo., p. 6, |. 7), and that she
would have been subject to the contempt powers of the court
for not complying, (Defs.Memo., p. 6, Is. 7-9). Maki falsely
states that Ginsburg notified me of his intention to comply
with Hanson's subpoena by letter dated August 20, 1991,
(see Gins.Ltr. at Gins.Aff., Exh 2). (Generally see Maki's
representations at Defs.Memo., pps. 5-7.)
Maki's recollection and contention as to the time of the
disclosure of my confidential records on or before August 26,
1991 is accurate. As I have previously pointed out to the
court, Hanson had knowledge of my confidential records in
76
order to fabricate her false testimony. By illegally providing
that information to Hanson in advance of her deposition, and by
other means, Maki and Ginsburg helped Hanson prepare her
she could not legally have obtained at that time and which she
intended to use to maliciously defame and harm me. (See
Bergmann _v. Hanson Dist.Crt. case file number: CT-91-12540,
the record of that case is incorporated herein by reference; and
see resulting Order, EXH. F.) Giving sensitive, confidential
medical records, to a witness who was known to
Dorsey's attomeys to have a malicious retaliatory
predisposition toward me, was outrageously irresponsible, but
it served their purpose in skillfully creating false testimony
and threatening a further criminal defamation of me.
Maki's contention that the disclosure was legally made
pursuant to Hanson's subpoena is wholly false.
In connection with their disclosure of confidential medical
and other case records, and to cover up their wrongful conduct,
Ginsburg and Maki made further misrepresentations to the
Court by way of their “Memorandum In Support Of
Motion To Strike", signed by Maki, ("Defs.Memo.”); a
signed revised "Supplemental Affidavit Of Roy
A.Ginsburg", ("Gins.Aff.") in support of that Memorandum:
and a conflicting unsigned "Supplemental Affidavit Of Roy
A. Ginsburg". Those misrepresentations firmly and factually
establish the deceitful tactics of Ginsburg and Maki.
Ginsburg and Maki made amisrepresentation to the
Court in stating that the, “Defendants and their attorneys
complied with the discovery rules in producing", my
confidential medical records. (Ref. at Defs.Memo., p. 5, Is.
16-20; and note that Defs. have never denied providing
those records.) The subpoena fails to comply with the rules for
discovery because it was not served in connection with a duly
noted deposition as required by Minnesota Rules of
77
is
7 LAM ee SE
a oe
Civil Procedure, ("MRCP"), Rule 45.01. That rule
specifically states that a violation of it, “constitutes an_abuse of
process and shall subject the attorney or party to appropriate
sanctions or damages". Ginsburg knew of that rule, and he
knew of the impropriety of the subpoena because he had
reviewed my advance written notice. (See Gins.Aff., Exh. 3,
prgs. 1, 3.) The subpoena also failed to provided me with
adequate time to respond, (2 days), to move to quash.
Ginsburg was aware of that impropriety and he was aware of
my intention to file a motion to quash. (See Gins.Aff., Exh. 3,
prg. I, Is. 12-15.)
Maki and Ginsburg misrepresented to the Court that
they, “notified [plaintiff] in writing that [defendants] intended
to comply with the subpoena unless [plaintiff] moved to
quash the subpoena before the return date". (See Defs.Memo.,
p. 5, ls. 20-23, and p. 6, Is. 1-3; see ref. Gins.Aff., Exh.2; see
Gins.Aff. p. 2, prg. 5.) _Defense counsel did not notify
me. Their Exhibit 2 is addressed to Alan Greenberg, an
attorney who appeared in this matter, but not my attorney in
the mam" pursuant to which the subpoena was issued. I was
represented in the Hanson matter by Larry A. Celander, who
was counsel of record in that case, and pro se in association
with Celander, subsequent to his illness and my notice served
on the parties and for filing of record with the Court on July
19, 1991. My letter of August 22, 1991, gave full notice to
Ginsburg of my pio _ se representation. Further,
Greenberg never notified me of Ginsbyrg's letter of August
20, 1991. (The fact that Greenberg did not notify me
of Ginsburg's letter is indicative of collusion.)
Ginsburg and Maki lied to the Court when they represented
that Mr. Theodotou did not, “voluntarily rescind the
subpoena", and that “defendants were subject to the
contempt powers of the court if they did not comply with the
subpoena". (See Defs.Memo., p. 6, Is. 4-12; unsigned
Gins.Aff., p. 3, prg. 6; and compare signed Gins.Aff., p. 3.) I
78
sent my letter dated August 22, 1991, (Gins.Aff., Exh. 3.), by
U.S. Mail on the morning of August 22 by depositing it at the
downtown post office in order to assure its delivery in advance
of the production date. Theodotou received and acted on my
letter by August 24, 1991, when he acknowledged to me
verbally thathe would not enforce the subpoena, and that he
had so advised Ginsburg. Theodotou confirmed his
rescission ofthe subpoena in writing. (See Theo.Ltr.,
Aug. 26, 1991, EXH. G.) Following Theodotou's rescission
of the subpoena, I was not notified of any later subpoena in
connection with any case or matter, or any related notice of
deposition, or other production date.
Despite Theodotou's instruction to Ginsburg and assurances
to me, I did not trust Ginsburg to refrain from providing the
records. I expected that Ginsburg would use the guise of the
subpoena to provide Hanson with my confidential medical
records for the purpose of fabricating false testimony. In
an attempt to prevent such unscrupulous deceitful conduct by
Ginsburg, I sent my legal counsel, Larry Celander, to appear at
the place designated for the production, at the time and
date appointed. Pursuant to Celander’s affidavit, no one
was present at the designated place and time of the
production. (See Celdr.Aff, EXH. H.) The fact that
Ginsburg and Theodotou were not present at the place and
time designated for the production confirmed that Theodotou
had effectively notified Ginsburg of the rescission of the
subpoena. So, to accomplish their deceitful purposes to
violate the Protective Order, bribe Hanson, and prepare
her manufactured testimony, Ginsburg and Maki sent my
confidential medical records and all other information
related to the suit directly to Hanson, or Theodotou, or both
of them, completely outside of the subpoena process and in total
disregard for it.
Ginsburg's amended signed Supplemental Affidavit contains
materially false and inconsistent representations concerning
79
the events surrounding the disclosure of my confidential
records. First, Ginsburg truthfully confirmed that he received
Has non's subpoena of August 8, 1991. (See Gins.Aff., p. 2,
prg. 3 ref. to Exh 1; and, p. 2, prg. 4, describing the
subpoenas requirements.) Next, Ginsburg confirmed that he
complied with that subpoena which required that document
production on August 26, 1991. Gins.Aff., p. 2, prg. 5,
confirms that, and his_ recollection as to the time of that
disclosure is consistent with Meiu’s and with my
statement. Gins.Aff., p. 2-3, prgs. 5-6, suggensts that I could
have prevented that disclosure by serving a Notice of Motion
and Motion, and that Ginsburg produced the documents even
though he new of the improprieties associated with the
subpoena and despite the established fact that Theodotou
told him not to produce the information. Ginsburg was
copletely aware of my objections to the Hanson subpoena and
the improprieties associated with it before providing the
documents. That is apparent by his reference to my letter
to Theodotou dated August 22, 1991, (Gins.Aff., p. 2, prg. 3),
and by his confirmation of his knowledge that I informally
contacted the attorney who served the subpoena, (Gins.Aff.,
p. 3, prg. 6, and ref. to Exh 3). The production was illegal and
contemptuous. Even though the subpoena did not follow legal
procedure and had been rescinded, Ginsburg obviously had his
own purposes in mind when he provided Hanson with the
information and confidential records to facilitate his
fabrication of her perjured testimony.
Gins.Aff., p. 3, prg. 6 attempts to justify his _ illegal
disclosure _ by stating that a later subpoena from the
Department of Jobs andTraining, ("DJT"), requested the
identical information. The existence of a later subpoena
certainly does not justify his initial illegai acts. The crucial
distinction is that the DJT subpoena was requested by
Theodotou after Hanson's perjured testimony was prepared
and taken by Ginsburg. (See Theo.Ltr. dated Oct. 7, 1991,
EXH. I.)
80
Within the DJT rules and informal procedures, I moved to
quash Theodotou's request for the DJT subpoena. (See
Berg.Ltr., misdated Oct. 25, 1991 but noting it had been sent
Oct. 9, 1991, EXH. J.) | Ginsburg's statement that he
confirmed with Theodotou that I had not taken action to quash
the subpoena is a lie, (see Gins.Aff., p. 3, prg. 6, Is. 19-21), as
the court can plainly see from my letter, EXH. J.
Ginsburg's representation that he would be in violation
of the DJT subpoena and a court order if he did not produce
the documents to Theodotou, (ie: The same documents he
previously and illegally disclosed to Hanson), is another
lie. Ginsburg stated that he was compelled to obey the
subpoena, but the true facts show that he willfully disregarded
its requirements when it wasreissued on November 14, 1991.
(See the affidavit of Samuel B. Fried, Director of the
Appellate Office, Minnesota Department of Jobs and
Training, Frd.Aff., EXH. K.) Ginsburg did not produce the
documents and appear at the noticed hearing sit
specifically required, (see Gins.Aff., Exh 4, pg. 2, Is. 1, 5-9).
Since the DJT does not have a requirement to notice the
deposition of a custodian of records, as required by MRCP,
Rule 45.01, their rules require the custodian to appear at a
hearing so that a questionable production can be challenged
at that time. Ginsburg claims he was not required to go to
the hearing because he thought Hanson's company went
bankrupt in between the time he received the subpoena by
mail, (sometime after October 8, 1991), and the hearing date
scheduled a few days later and stated on the subpoena, (October
16, 1991). (See Gins.Aff., p. 4, prg. 6, Is. 2-7; and Exh 4, p.
2.) That representation is an absolute lie. Neither Hanson's
companies nor Hanson filed bankruptcy, there is no record of
such a claim in connection with the DJT proceedings, and the
issue of a bankruptcy is wholly irrelevant in connection
with such proceedings anyway. (See Frd.Aff., EXH. K.)
Ginsburg willfully and wrongfully produced the documents to
81
a it
Theodotou, and he was ordered to appear at the hearing. The
hearing did go forward, Hanson did appear by representation,
and Ginsburg did not appear, all of which is documented
by the DJT Determination and Findings. (See the Department
Of Jobs And Training, “Notice Of Findings Of Fact And
Decision", dated December 2, 1991, EXH.L; also see the
Frd.Aff., EXH. K.) If Ginsburg truly felt he would have
been in violation of a court order had he not complied with the
DJT subpoena, then he would have appeared at the hearing just
as the subpoena and the DJT rules clearly require. Again, it is
obvious that Ginsburg had only his own unlawful purposes in
mind when producing documents to Hanson and he did so in
total disregard of proper subpoena procedure.
Even if the DJT subpoena had been appropriate, it did
not cover up Ginsburg's prior unlawful disclosure to Hanson.
Further, even if Ginsburg had been required to comply
with both subpoena productions, the disclosure of my
confidential medical _ records was unauthorized and
unlawful in violation of a Protective Order, Confidentiality
Agreement, and release authorization forms. Those
confidential records were privileged and were not requested,
but were specifically excluded by both subpoena documents.
(See Gins.Aff., p. 3, Is. 18-19; Gins.Aff., Exhs. 1,4; and,
discussion at Part III., "Violation Of Protective Order".)
The remainder of the Gins.Aff. is redundant misre-
presentation.
82
[PAGES 47 TO 63}
D. White Notes.
In response to discovery requests, the Defendants and
their counsel identified and produced copies of certain
handwritten Investigation Notes that were taken
contemporaneously during the so-called investigation of he
MacRae charge. At the deposition of Gary White taken by
my legal counsel on December 12, 1990, Mr. White
inadvertently identified certain other notes he had made
several weeks after his interviews and which summarized his
alleged investigation of charges against me and supposedly
supporting such charge. (See White Depo., EXH. B, p. 13,
ls. 7-10.) Those notes, referred to herein as the _Summary
Notes, were prepared and typed after the investigation
and purported to be a summary of it. The_Summary_ Notes
were not identified or produced by Defendants or their counsel,
even though they were aware of them at the time of their
response to my discovery requests. (ie: See Defs.Rsps., EXH.
M, p. 14, Is. 1-4, showing their response to Pit.Intrg., EXH.
M, p. 8, prg. 22.) When White identified the Summary
Notes he was sternly reprimanded by his counsel, Maki.
Maki said White had been specifically instructed not to
mention or discuss those documents. (See White Depo., EXH.
B, p. 13, Is. 16-20, and 11-12; p. 14, Is. 11-13; p. 15, Is.
13-16.)
The significance of the Summary Notes and a complete
unedited set of the Investigation Notes is that by examining them
together, Defendants' fraud in accusing me of sexual
harassment and in terminating me will be apparent. That is
because White included false and exaggerated allegations
against me in the Summary Notes that are not supported by the
handwritten Investigation Notes, and which can be proven
false. White created the falsified Summary Notes weeks
83
after the investigation for the purpose of fraudulently
documenting his opinion of sexual harassment.
The Plaintiffs Interrogatories To Defendant Lee Data
Corporation, attached with EXH. M, specifically required a
disclosure of the identity of both the Investigation Notes and
the Summary Notes. When responding to the discovery
requests in this case and in the initial case, Maki failed to
identify the White Summary Notes as required by definitional
instruction number 7, and interrogatory number 22, and
failed to produce them as required by statement and document
production requests.
It is ciear from Defendants’ and Maki's Geliberate
concealment in response to the discovery requests, and Maki’'s
reprimand of White during his deposition, that Defendants
and Maki were aware of the existence, identity and content
of the Summary _ Notes prior to White's inadvertent disclosure at
his deposition. Maki was therefore required to disclose the
identity of those notes and produce them in response to my
interrogatories and request for statements and documents.
Defendants' and Maki's failure to identify the existence of
the documents in accordance with discovery requests was a
willful concealment of material information; a MRCP, Rule 11
violation by Maki; as well as misrepresentation and
perjury. Since the documents would reveal my innocents,
the initial criminal fraud perpetrated by the Defendants
against me, and now onthe Court, Maki and Ginsburg have
a professional obligation to produce the documents. (See
MRPC, Rules 1.2(c), 3.3, 3.4, 1.13(a), etc.)
The Summary Notes, and an unedited set of the
Investigation Notes, are material to the litigation and are my
only means of gaining that discovery information because of
the unusual and significant lapse of memory of the
Defendants. None of the Defendants or any of the witnesses
seem to remember any details of the alleged charges against
84
ge oa NaN Sie aso TR a a kg ee Na al ar eta te LM cata SE! de hv te ot fe ae ES Sf he SS Sas Bie ha Ne ie
me or any reason why the allegations were presumed to be
a sexual harassment.
The Summary Notes are also material because White was the
only person to conducted the investigation of the charges
against me, and he did it pursuant to Dorsey &
Whitney's instructions. (See Defs.Memo., dated Oct. 10,
1989, p. 5, prg. 2.) Those Notes will show that White
documented his own false statements, pursuant to Dorsey's
instructions, to substantiate his allegation of sexual harassment
and used those Notes to document managementsact in
terminating me. The fact that the Summary Notes contain
false statements can be conclusively shown by comparing them
with the = Investigation Notes. made contemporaneously
during interviews with MacRae, and with MacRae's
deposition. The Investigation Notes documenting statements
made by MacRae, do not substantiate the false statements
documented by White and Dorsey in the Summary Notes.
Maki's _misrepresentation and perjury in connection
with the Summary Notes was willfully and maliciously
intended to conceal material information that would prove my
innocents of the allegations of sexual harassment that were
made against me. Attorneys have a legal and moral
obligation to come forward with such information. Dorsey's
attorneys concealed the Summary Notes and blocked my
discovery of the Investigation Notes which were
wrongfully excluded by Judge Sommerville who did not
compare them to the Summary Notes. (The Defendants’
probably did not produce the Summary Notes to Judge
Sommerville for the in camera review that he ordered.)
Such a comparison would prove the fraud and pattem of
criminal conduct by the Defendants and their attorneys.
85
Ill. VIOLATIONS OF PROTECTIVE ORDER.
During the pendency of my Initial Action against Lee
Data Corporation, served Deceriber 19, 1988, court file
number CT-89-663, the Defendants proposed and drafted
a Protective Order. (See Protective Order, EXH. V.) I!
agreed to the draft order and its submission to the Court
for signing. The Honorable Robert K. Levy signed the Order
February 6, 1989, and the Order was properly served by the
Defendants on all parties.
At my _ deposition taken by Defendants’ counsel,
Ginsburg, on March 22, 1990, all parties agreed to and
ratified their acknowledged applicability of the Order to
the present action. (See Berg.Depo., EXH. W, p. 149, ls. 4-
15.) Both Ginsburg and Steinberg expressly agreed, pursuant
to Greenberg's statement, that information provided to them
by me would be protected by that Order. The agreement
and renewed acknowledgment of the Order was promried by
Defendants' request for my "Authorization For Release Of
Medical Information", including my medical records
maintained by Mindy Mitnick. (See “Autliorization For
Release Of Medical Information", prepared by Dorsey &
Whitney for Mindy Mitnick, EXH. X.)
The Authorization, Exhibit X, expressly limits the
purpose of the disclosure by Mitnick, and the use of the
information by Dorsey & Whitney. Use of the information
was limited to the "Litigation" as of May 29, 1990, and no
other later litigation or other purpose. The authorization
expressly prohibits Dorsey & Whitney, or Mitnick, from
disclosing those medical records, “to atiy other or third
party”. The Authorization reserves the Plaintiff's
unconditional mght to revoke his consent at any time. That
consent is hereby revoked.
Prior to my deposition of March 22, 1990, I instructed
Greenberg to obtain or renew the Protective Order, and to
specifically state on the record that all of my medical
information _is confidential. When Greenberg failed to
specifically refer to my medical records, I clearly
established the absolute confidential nature of those records
myself. (See Berg.Depo., EXH. W, p. 153, Is. 8-13.
Ginsburg and Maki, willfully violated the Protective
Order on at least two occasions, and with malicious intent.
Ginsburg violated the Order when he provided my
confidential records and medical records to his witness
Hanson and her counsel, Theodotou. (See Defendants'
admissions at Defs.Memo., p. 5, Is. 16-17, stating that,
“Defendants and their attorneys" produced those documents,
specifically referring to the Plaintiffs medical records
identified at the preceding Is. 11-13 of the same page; and, the
unsigned Gins.Aff., p. 2, Is. 12-28. Also, ref. Plts.Aff., Jan.
13, 1992, p. 10, prg. 6g; Plts.Ltr., Nov. 27, 1991, Secs.
3, 4; and, Plits.Memo.Aff., Aug. 4, 1992, p. 3, ls. 20-26.)
That disclosure was made without notice to me, (see
discussion at Part II. A. above), and before the deposition of
any medical witness.
When Ginsburg violated the Order and the Authorizations
by providing my confidential medical records to Hanson and
Theodotou, he was on notice of Hanson's malicious
intention to cause harm to me. (See Hans.Depo., EXH. Y,
pps. 35-37, esp. p. 37, Is. 8-10, wherein Ginsburg
specifically refers to that portion of my action against Hanson
which describes her threats of violence against me and my
family. My action against Hanson is incorporated by
reference to Bergmann v. Hanson, et al, District Court File
No: CT-91-12540.) Hanson's malicious, violent, defaming
Statements and threats against me are thoroughly documented
by my Motion for Summary Judgment, Memorandum and
87
Affidavit in that case. (Ref. the Complaint, File CT-91-
12540, p. 5, prg. 27; p. 9, pres. 55, 56, and 59;
Pits.Memo., p. 13, prg.D to p. 20,1. 7; and Pits.Aff. with ref.
Exhs., p. 12-22.) Ginsburg also knew that Hanson intended to
use my confidential medical records against me. (See
Pits.Memo.Aff., August 4, 1992, p. 3, Is. 20-22; also
implied by Gins. knowledge of the lawsuit and its
allegations.) My confidential medical records, in Ginsburg's
possession, had value to Hanson for her malicious
purposes, and to use in her defense against me. The
disclosure of the records to Hanson constituted a bribe for
that reason.
In disclosing my confidential medical records to Hanson
on August 26, 1992, as Ginsburg has admitted, (see prior
refs. above), he deliberately helped Hanson manufacture
the false testimony provided by her deposition which
Ginsburg noticed and took on September 26, 1991. By
providing Hanson with my confidential medical records,
without telling Mitnick, Ginsburg was able to obtain
Hanson's manufactured testimony based on Mitnick's
confidential evaluation. Ginsburg was then able to provide
Hanson's fabricated statement to Mitnick, probably without
Mitnick's knowledge that it had been based on her
confidential evaluation, with the effect of causing Mitnick to
change her evaluation, making Hanson's false statements seem
believable, and “dovetailing" Hanson's false testimony with
Mitnick's. Such a practice is reprehensible, and is a fraud
against me and on the Court.
When assisting Hanson in manufacturing her false
testimony about me, Ginsburg and Maki had a knowledge and
understanding of my medical records and emotional
vulnerability to false accusations. They knew the
manufactured testimony would cause suicidal distress, based on
Mitnick's untainted evaluation and notes and their personal
knowledge of other facts in the case, and that the implied threat
88
of bringing false accusations before the Court would
intimidate and coerce me in their attempt to force a dismissal
of the case.
Previously, during the pendency of the Initial Action,
Defense counsel, Ginsburg and Maki, violated the Protective
Order by making an unauthorized secret disclosure to the
Lawyers Board of Professional Responsibility of my thirty
four page "Confidential" letter dated September 2, 1988,
addressed to the Defendant Robert Besinger. (See EXH. ys
Berg.Ltr. to Greenberg, copying the Lawyers Board investigator
Eliz.Sipe, dated June 2, 1989; and, copy of selected pages of
the Confidential Letter, EXH. Z, p. 100650, 100681.) The
unauthorized disclosure of the Letter was a willful and
calculated deception in disregard for my right to confidence
and was designed to maliciously harm me. .
The Confidential Letter is my original authorship, it was
written by me and delivered by messenger to the Defendant
Mr. Besinger on September 3, 1988. The Letter was
marked "Confidential" at the time it was delivered to
Besinger. Besinger read the Letter, telephoned me to discuss
it, promised not to make copies of it, promised to maintain
its contents in "Confidence", and retumed the only original
copy of the Letter to me in a sealed envelope.
At a hearing attended by me and held before the
Honorable Judge Roberta Levy on March 22, 1989, Maki
claimed that my attorney had not produced a copy of the
Letter in response to her discovery request. Albright replied
by stating that he had already produced a copy and
simultaneously handed Maki another copy of the Letter. The
Letter was not read or disclosed at the hearing in any way. The
Letter was not entered into evidence or shown to Judge Levy, or
anyone else in the court room. There wer: a0 spectators in
the court room.The Letter was not submitted as an exhibit
Or aS a separate paper to the Court. The Letter was not filed
with the Court. No record was taken of the hearing, and no
record was made of any disclosure of the Letter to anyone else
either by me or my attorney. No one was present at the hearing
other than me, my attorney, Maki, and Judge Levy. Not even
a court reporter was present.
After obtaining the Letter through discovery, subject to
the Protective Order, Maki provided it to the Defendants
Lee Data and Robert Gordon to use outside of the scope of
litigation, in violation of the Order, for the purpose of
further disclosing it to the Lawyers Board of
Professional Responsibility, in connection with misconduct
charges filed against me by Gordon. The Lawyers Board
dismissed the charges against me.
At the time of its decision to dismiss Lee Data's and
Gordon's retaliatory charges against me, the Board's
investigating officer, Vance Opperman, advised me of the
unauthorized disclosure of the Confidential Letter by Lee Data
and its attorneys. Mr. Opperman advised that Dorsey &
Whitney's attorneys prepared and directed the presentation
of the charge to the Lawyers Board. Maki has admitted
that the Letter was made available to Lee Data's in-house
counsel, Warren Simpson, and that it was presented to the
Lawyers Board. (See Maki Letter, Oct. 17, 1989, Plts.Aff.,
Exh. Z, p. 1, prg. 3.) Acknowledging those facts, Maki
argues that the Letter was produced in open court and was
not entitled to protection. (See Prot.Ord., prg. 6, Is. 16-22,
regarding an identical situation and requiring the confidence
to be preserved.) I complied with the requirements of the
Protective Order when the Letter was produced. The Letter
was plainly marked "Confidential" at the time it was given to
Maki, and that is all that was required to bring it within the
Order. (See Prot.Ord, prg. 4, ls. 13-14; and prg.2.) The
circumstances in the court room were as described above. The
Protective Order was in force at the time of the
production. The disclosure of the Letter by Maki and
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Ginsburg to Lee Data was made without notice to me. I noted
the confidentiality of my records at my deposition, pursuant to
Prot.Ord., prg. 6. (See Berg.Depo., EXH. W, p. 153.) The
disclosure by Lee Data to the Lawyers Board was made
without notice to me, in breach of the Prot.Ord., prgs. 1, 8, 12,
15,
All of the above described disclosures were made in
violation of the Protective Order. (See Prot.Ord., prgs. 1, 6,
7, 8, 12, and 15.)
[V. UNDUE HARASSMENT.
Reference MRPC, Rule 4.4:
"In representing a client, a lawyer shall not use means
that have no substantial purpose other than to embarrass,
delay, or burden a third person, or use methods of
obtaining evidence that violate the legal rights of such a
person.”
The named Dorsey & Whitney attorneys incited my
former employer, Diane G. Hanson, to perjure testimony
against me, (as explained above), to act on her terroristic threats
and to defame me. The actions of Hanson are well
documented by Dist. Cr. Case Number CT-91-12540,
Fourth Judicial District, State of Minnesota and the courts
order against Hanson and her company’s dated Nov. 4, 1992.
The record and order in that case are incorporated here by
reference. Maki and Ginsburg caused undue harassment of
me by inciting Hanson. They incited Hanson by falsely
representing to her and her attorney, Andrew Theodotou, that
I flagrantly misused the legal process, that I acted deceitfully
and that I engaged in “aberrant sexual conduct". All of
those representations were false and maliciously made
for the purpose of causing Hanson to act on her terroristic
threats and to encourage her to fabricate perjured
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testimony. Hanson's letter dated July 20, 1992 to the Board of
Professional §_ Responsibility shows Hanson's reliance on
Dorsey & Whitney's attorneys’ representations and opinion
about me. (See EXH. AA, prg. 3.) All of Hanson's
allegations against me are without any basis in fact, and
were developed through Maki and Ginsburg's representations
and transmission of confidential information to her. They
incited Hanson through false representations, amounting
to criminal defamation, (Minn.Stat., Sec. 609.765), just as
they inflammed the Court's hostility through misrepresentation
and fraud.
The October 7, 1991 letter of Theodotou to Robert
Mandell, (EXH. I), reflects Dorsey's representations to him that
I was involved in sexual misconduct. Ginsburg made
those representations to Theodotou to encourage him to
subpoena the documents so that Ginsburg could create a
pretextual excuse for his wrongful disclosure of
confidential and proprietary documents to Hanson.
Ginsburg actually gave documents and information to
Hanson to prepare her perjured testimony, prior to her
deposition of September 1991, and in violation of the
Protective Order, all as discussed above. Recognizing that
his wrongful disclosure of the documents could later be
discovered, Ginsburg needed the guise of the Department of
Jobs and Training subpoena. (See discussions above.)
At the same time, or shortly after, Dorsey's attorneys
made false representations to incite Hanson, Hanson actually
followed up on her threats and plotted to have me murdered.
(See Swanson Aff., prg. 6, Exh. M of Pits.Aff,,
Dist.Crt.File: CT-91-12540.) Maki and Ginsburg acted
maliciously with foreknowledge of the potential consequences
of their actions because they had prior notice of Hanson's
terroristic threats against me and my family. Maki and
Ginsburg thoroughly reviewed my Complaint against
Hanson, which details some of her threatening acts and
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statements, prior to and in preparation for their deposition
of Hanson. (See Hans.Depo., Pits.Aff., Exh. H,
Dist.Crt.File: CT-91-12540.)
V. BRIBERY. aed
Minn. Stat., Sec. 609.42, describes acts _ that constitute
bribery. Specifically, Subd. 1, prgs. (3) and (4) apply to
Dorsey's actions with respect to Hanson's testimony and
the transmittal of my protected confidential medical records to
her in violation of a Court Order. The statute refers to any
benefit or reward or consideration to a person who is about to
become a witness. It does not require the payment of money.
Due to my pending action against Hanson, she wanted
confidential and other discovery information from Dorsey &
Whitney to assist her ina defense against me, to use for
Purposes of malicious defamation, and to blame me for her
corrupt conduct which was being investigated by the attorney
generals offices of North Dakota, Minnesota, Oregon and
Illinois.
Dorsey & Whitney provided my confidential medical
records to Hanson in violation of the Protective Order, as a
bribe for the purpose of encouraging her false testimony
against me. Hanson did not have a legal right to that
information, and she needed it to develop her false
testimony against me.
VI. ABUSE OF PROCESS
The Defendants’ and their counsels’ actions in this case
constitute an abuse of process because the Defendants used the
The Defendants therefore used the Courts’ Order and the
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discovery process in the litigation to fulfill their ulterior
motives of coercion, obstruction of justice, and fraud.
Abuse of process of the Court is the malicious perversion
of a regularly issued process whereby a result not lawfully or
properly attainable under it s secured. Wodd v. Barv, 1937,
179 Minn. 208, 271 N.W. 447. Proof of an abuse of process
requires a showing of two elements:
1. The existence of an ulterior purpose; and
2. The act of using the process to accomplish a result not
within the scope of the proceeding in which i
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