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LOS ANGELES Courthouse News Service

LOS ANGELES Courthouse News Service

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Published by Nikki D White

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Published by: Nikki D White on Nov 15, 2011
Copyright:Attribution Non-commercial


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 LOS ANGELES (CN) - Hundreds of homeowners claim several California attorneys used fraudulentadvertising "unrivaled in its falsity and brazenness," promising fictitious class-action settlements againstmajor banks, and misused the name of the homeowners' attorney, Mitchell Stein, to dupe them intopaying thousands of dollars.Stein was one of a long list of defendants sued by California Attorney General Kamala Harris in August. That complaint accused the Kramer and Kaslow law office, and others, of running a foreclosurescam that suckered "thousands of California homeowners." The state claimed the defendants "prey ondesperate consumer homeowners facing foreclosure" by selling participation in bogus "mass joinder"lawsuits and "litigation settlement(s)," but "No settlements exist and in some cases no lawsuit has evenbeen filed."Stein and his clients then countersued Attorney General Harris, claiming she was "doing Bank of  America's bidding" by seizing legal files from Stein, denying his clients the right to the legal counsel of their choice. Similar countersuits were filed in Miami and New York.In the latest barrage, in L.A. Superior Court, Stein and his clients continue their crusade against thelaw firms that, they say, prey on distressed homeowners under the guise of protecting them from fraud."Included among the conspiracy by all defendants, acting in concert, was utilizing the false advertisingto adversely impact the rights of millions of home owners across the United States and to defraud theirelected representatives for reasons amounting to nothing but pure 'profit,'" according to the complaint.The plaintiffs include more than 300 homeowners from several states who hired Stein to representthem in lawsuits against Bank of America and other major lenders.Stein and his clients claim the defendants made more than $10 million from their scheme.Named as defendants are Brookstone Law, its owner Vito Torchia Jr., his associate Damian Kutzner,California law firm SML, SML partners Kenin Spivak, Theodore Maloney and Edwin Lasman, and ApexLegal Group and its employees Christopher Tomaszewski and Bridget Jones.Stein filed his opening shot against a major bank,
Ronald v. Bank of America
, in March 2009, allegingthat Bank of America had committed mortgage fraud and was illegally foreclosing on his clients' homes.His clients claim that Stein succeeded in stopping foreclosures against their homes and expanded thelawsuit against the bank.According to the complaint, Stein represented many California homeowners for no charge.The plaintiffs say that in 2010, Stein enlisted defendant Spivak's help as co-counsel in the expandedlitigation against Bank of America, despite Spivak's lack of experience in representing homeownersagainst banks."Unknown to attorney Stein or any of the plaintiffs in the Ronald case - most of whom are plaintiffshere - Spivak had ulterior motives for wanting to be part of the Ronald case," the complaint states. "Hismotives were one of fraud, deceit and profit, which he failed to disclose to anybody upon his associationinto the case by Mr. Stein in March 2010. Within three months of being associated into the case,defendant Spivak began asking anybody he could find - including Stein and at least half of the plaintiffs
herein - for money or agreements to pay money."Stein and his clients claim that Spivak infiltrated Maloney into Stein's practice to learn about thebanking industry, gather information on Stein's cases against the banks and "poach" contacts to be usedin the defendants' fraudulent marketing campaigns.A few months later, they say, "Spivak would utilize the information both he and Maloney were able to'poach' from Mr. Stein to ultimately form law firms and relationships to initiate massive marketingcampaigns (a) selling themselves as experts in the field of bank litigation and (b) lying to home ownerswith false mailers and advertisements in order to induce them to send money for the benefit of Spivakand Maloney ..."The defendants defrauded more than 1,000 homeowners nationwide by sending a false mailer usingStein's business name and logo, falsely stating that Stein was involved in their marketing campaigns,according to the complaint.Stein started using the moniker of a Doberman dog next to his trade name after a 1991 article inPremiere Magazine labeled him "the Doberman" in connection with a high profile case.Stein's clients say the defendants also tried to remove Stein from the Ronald litigation because hehad refused to participate in advertising campaigns."Based upon the conspiracy, the Maloney Group - lacking any standing under law given that theywere not 'real parties in interest' to any case against any bank in the United States - made a motion inthe Ronald case to 'remove Mr. Stein as lead counsel' in such case," the complaint states."Notwithstanding that the motion was unsuccessful, the Maloney Group sent out hundreds of mailersthat made representations to the opposite: that the motion was successful and that clients shouldchoose them as their lawyers."Stein and his clients say the defendants failed to disclose that "from December 2010 through March29, 2011 and even thereafter - the Maloney Group and [its affiliate] United Law Group were using thename and likeness of Mitchell J. Stein and his 'trade dress' to induce homeowners to pay them money.For example, lead plaintiff Todd Legaspi - a highly regarded member of our United States military - paidmoney to the Maloney Group and the Brookstone Group and United Law Group (and has been asked topay more money) based upon the representation by Vito Torchia (through his staff and individually) that'The Doberman' (Mitchell J. Stein) is currently representing Mr. Legaspi. That representation made byVito Torchia in conspiracy with all defendants herein, was at all times false and none of the defendantshad any belief that such a statement was authorized by Mr. Stein or was truthful." (Parentheses incomplaint).The plaintiffs say the mailer "was a part of the conspiracy to the great damage of all plaintiffs herein.Illegal mailers and advertisements, and trickery and intrinsic fraud to courts, in the middle of a crisissuch as this one, hinder and delay the efforts of legitimate persons and lawyers wishing to bring theactual and ultimate wrongdoers to justice."They add: "To top it off, as the defendants were completing the first phase of their fraud and deceiton unsuspecting American homeowners, they produced infomercials ... to follow up on the marketingblitz to profit off of the illegal mailer. ... During this time, bank servicers increased foreclosure effortsbased upon the unique California non-judicial foreclosure laws and plaintiffs were harmed extensivelyby foreclosures, invasions of their privacy, and other actions taken by bank servicers during thedeceptions practiced by the defendants and at a time when defendants were their lawyers. In truth and

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