NPR Pulls Out The Big Guns: Asks For Sanctions Against Lawyer Steven Biss For Lying

from the boom dept

Earlier this month, we wrote about an absolutely awful ruling in a bizarre lawsuit brought by Fox news commentator Ed Butowsky, represented by lawyer Steven Biss (a name you might recognize). Butowsky sued NPR and reporter David Folkenflik for accurately reporting on a failed lawsuit by another Fox News commentator, Rod Wheeler, accusing Fox News and Butowsky of defaming him in regards to a story about Seth Rich -- about whom conspiracy theorists seem to regularly fantasize.

As we noted, the NPR article highlighted over a dozen times that it was reporting on claims from Wheeler's lawsuit, and yet the judge, Amos Mazzant, ignored all of this to say that it did not have clear sourcing, and thus allowed the case to move forward. We're still somewhat dumbfounded by this, but NPR and its lawyers have decided that now is the time to break out the big guns, and, in a new filing, are claiming that Butowsky and Biss directly lied to the the court, and should be sanctioned for it.

Pursuant to Federal Rule of Civil Procedure 11, Defendants (collectively, “NPR”) respectfully move this Court for sanctions against Plaintiff Ed Butowsky (“Butowsky”) and his counsel. Butowsky knowingly pleaded false factual allegations in his Original Complaint (Dkt. 1), and the Court relied on them in denying NPR’s Motion to Dismiss (Order, Dkt. 65). Butowsky repeated those false allegations in Butowsky’s Second Amended Complaint (“SAC”) (Dkt. 72). His counsel either knew these allegations were false or failed to make reasonable inquiry under the circumstances. Having recently secured third-party discovery proving Butowsky made these misrepresentations, NPR brings this motion now to comply with its obligation to inform the Court of Rule 11 violations promptly

The specific claims are that Butowsky, with Biss as his lawyer, made "three key allegations" in his original and amended complaints:

(1) Butowsky was not involved in Wheeler’s investigation and had little communication with Wheeler;

(2) Butowsky had never seen, and was not a party to, Wheeler’s contract with the Rich family; and

(3) Chapwood Capital Investment Management, LLC (“Chapwood”), Butowsky’s business, lost Sally Davis as a customer because of the alleged defamation.

However, NPR says in its filing that during discovery, they have found out that all three of these key claims, which the court relied on in denying the motion to dismiss, were false.

First, Butowsky alleges that his involvement in Wheeler’s investigation was limited. Second, and relatedly, Butowsky alleges that he had never seen Wheeler’s contract with the Rich family. Both representations, purportedly based on Butowsky’s own personal knowledge, have been indisputably disproven by documents produced by [REDACTED]. Third, Butowsky alleges that his company lost clients and tens of millions of dollars in damages due to NPR’s defamation and disparagement, and cites as proof a single email from Sally Davis. But Davis swore in the attached declaration that Chapwood continues to manage her portfolio.

The filing documents "extensive" communications between Butowsky and Wheeler regarding the Rich investigation -- including Butowsky paying Wheeler prior to the Rich family agreeing to hire him to investigate the death of their son, Butowsky referring to the subsequent investigation as "our investigation" and receiving updated reports from Wheeler about the investigation, asking for and receiving access to Wheeler's investigation notes, and even reviewing "multiple drafts" of the eventual Fox News story before they were published.

The filing then goes into great depth detailing questionable actions by Butowsky, including making a clear threat that he was going to "sue the hell" out of "a lot of firms."

After Wheeler and Rich’s parents’ cases were (initially) dismissed, Butowsky publicly vowed revenge, saying:

Anybody who did anything negative to me as a result of the [Wheeler] lawsuit will pay ... I’m going to sue the hell out of a lot of firms. I want to see these people choke on their nerves and go through the same crap I had to go through.

Butowsky made good on his threat, filing a series of lawsuits in this District and going to great lengths—including misrepresentations in his pleadings—to keep his claims alive.

And then it goes into the details of why NPR's lawyers believe that Butowsky's lawyers, Biss and Ty Clevinger, deserve to be sanctioned -- including highlighting a long list of past misdeeds for which both lawyers have been sanctioned.

Both of Butowsky’s counsel have had their law licenses suspended and have been publicly reprimanded on multiple occasions. In fact, on January 14, 2020, Ty Clevenger’s California Bar license was suspended (his D.C. license had previously been suspended) for, among other things, filing frivolous litigation causing significant harm to the administration of justice. See In the Matter of Ty Odell Clevenger, Case Nos. 16-J-17320 (17-J-00289)-CV (St. Bar Court of Cal.) (Ex. I); see also Hughes v. Twenty-First Century Fox, Inc., No. 17-cv-7093, Mem. Order at 2 (S.D.N.Y. June 25, 2018) (listing multiple sanctions against Clevenger for “lack of respect for the judicial process” and “lack of candor”) (Ex. J); Robertson v. Cartinhour, 883 F.Supp.2d 121, 123, 128 (D.D.C. 2012), aff’d, 554 F. App’x 3 (D.C. Cir. 2014) (sanctioning Clevenger for “vexatious and abusive litigation tactics” and noting previous sanctions) (Ex. K). Clevenger was previously sanctioned for multiplying proceedings and unnecessarily increasing litigation burdens. See Ex. L, Sec. Am. Disciplinary Pet., Tex. Comm’n for Lawyer Discipline v. Clevenger, Cause No. 380-01407-2013, Collin County; Ex. M, Agreed Judgment of Public Reprimand, Commissions for Lawyer Discipline v. Ty Odell Clevenger, Cause No. 380-01407-2013; Ex. N, Notice of Disciplinary Charges, In the matter of Ty Odell Clevenger, Nos. 16-J-17320, 17-J-00289, State Bar Ct. of Cal.; Ex. O, Resignation with Charges Pending, In the matter of Ty Odell Clevenger, No. SBC-19-Q-30424, St. Bar Court of Cal.

Steven Biss has also had his law license suspended and been disciplined several times, including for assisting his client in “conduct he should have known was criminal or fraudulent.” Ex. P, Mem. Order, Va. St. Bar, ex rel Third Dist. Comm. v. Biss, Case No. CL07-1846, Cir. Ct. of the Cnty. of Chesterfield (suspending Biss one year and one day); Ex. Q, Order of Suspension, In the Matter of Steven Scott Biss, VSB Docket No. 09-032-078962 (suspension for “conduct involving dishonesty, fraud, deceit or misrepresentation which reflects adversely on the lawyer’s fitness to practice law” by holding himself out as an attorney while his license was suspended); Ex. R, Mem. Order, In the Matter of Steven Scott Biss, VSB Docket No. 07-033-070921 (publicly reprimanding Biss). Earlier this year, Biss was admonished for taunting a pro se litigant in pleadings. Steele v. Goodman, 2019 WL 3367983 (E.D. Va. July 25, 2019). And, a sanctions motion is pending against Biss in Lokhova v. Halper for, among other things, misusing the litigation process to launch politically-motivated attacks and advance an agenda beyond the courthouse. Cause No. 1:19-cv-00632-LMB-JFA, Dkt. 85-1, attached hereto as Ex. S

As NPR states in its filings:

It is difficult to imagine a more appropriate case for severe sanctions than this one involving a litigant who knowingly misrepresented facts to this Court and his lawyers whose improper conduct has led to suspension and public reprimand and who are making similar misrepresentations in another lawsuit before this Court.

Along these lines, there are two related news articles that are worth reading, regarding Biss. The Fresno Bee (a McClatchy paper that is currently being sued by Rep. Devin Nunes, also represented by Biss) last month had quite an article describing Biss' history of being disciplined. It is a very long article.

A transcript from the case shows the judge was flabbergasted by Biss, who said he was representing 226 clients suing Citigroup Global Markets, Inc. over bad investments.

In fact, Biss represented fewer than 170 investors.

The investors Biss represented were seeking $124.5 million from Citigroup Global Markets. They alleged that brokers at Citigroup Global Markets had purposely misled investors.

“We’ve got four of five people in here who have signed sworn declarations saying they don’t know you from the man in the moon and they’ve never talked to any of the lawyers for the plaintiffs in the lawsuit at the beginning. How is this possible?” asked Judge Kennelly, according to a court transcript.

Yikes. That article has many, many examples of questionable behavior by Biss. It also highlights yet another current case that Biss is involved in, Steele v. Goodman, in which Robert Steele is suing a YouTuber, Jason Goodman. Without going into all of the background there, Goodman last fall filed a motion to disqualify Biss, and included an email he had obtained from Biss' wife, Tanya Cornwell, in which she urged yet another online conspiracy theorist to sue Goodman, noting "I'm guessing a half a million bucks they will throw at you just to make it go away = catch it!" and also saying "anyways do contemplate suing Jason, he's likely insured."

There are a lot more rabbit holes to go down regarding the various cases that Biss is involved in, but it seems worth at least pointing to a Daily Beast story from last week, that talks about an alleged meeting of a group of people whose names are like a who's who of those represented by Biss -- including Butowski and Trevor FitzGibbon (whose lawsuit against Jesselyn Radack we've written about a few times to highlight Biss's questionable use of subpoenas to try to unearth the identity of the @DevinCow account). Also at the meeting is the internet character who was the recipient of the email sent by Biss's wife in the above Goodman case.

If that's all difficult to follow, and begins to feel like we should be tying red yarn to a corkboard, you're not wrong. But it does seem notable that Biss seems to continue filing these questionable lawsuits, and the various players all seem to have various connections to one another. Either way, the NPR filing has opened up even more concerns about Biss' legal practices.

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Filed Under: david folkenflik, defamation, ed butowsky, rod wheeler, rule 11, sanctions, steven biss, ty clevinger
Companies: fox news