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September 14, 2020 Top Story

Changed Circumstances Support Relitigating Decided Issues

Court tosses claim as insufficient, but not frivolous

By R'iele J. Sims

A state supreme court has offered guidance on when and how to bring new claims on issues that, at first glance, appear to be barred by binding precedent. ABA Section of Litigation leaders say the decision helps clarify when a claim is frivolous and when the facts and law have sufficiently evolved to support a new action.

The defendants asserted the enforcement firm engaged in the unauthorized practice of law

The defendants asserted the enforcement firm engaged in the unauthorized practice of law

Credit: erhui1979 | iStockphoto by Getty Images


The dispute in Mitchell v. J&M Securities, LLC, began when the self-proclaimed “professional judgment enforcement firm” J&M Securities, LLC—which is not a law firm— filed, without the assistance of an attorney, garnishment applications and interrogatories with the court clerk against three Missouri residents. In response, the garnishees filed a class action petition against J&M in the St. Louis County Circuit Court. The garnishees asserted that J&M and its sole principal had engaged in the unauthorized practice of law by filing garnishment actions against them and hundreds of other debtors in Missouri.

The trial court granted J&M’s motion to dismiss, holding that “the filling out and filing of … forms was not the unauthorized practice of law.” It relied on a 1997 Missouri Court of Appeals decision, Division of Employment Security v. Westerhold, which held that seeking a garnishment is not the practice of law.

J&M also requested attorney fees on the basis that the garnishees’ claims against it and its owner were frivolous, given the previous Missouri Court of Appeals opinion. The trial court denied this request. The Missouri Court of Appeals affirmed.

Frivolous Claim Standard

Missouri courts are authorized to grant attorney fees to prevailing defendants, but only in “the extremely rare exception,” and “only when the defendant demonstrates the plaintiff pursued … frivolous claims that would warrant dismissal of the claims and imposition of sanctions,” the Missouri Supreme Court explained in overturning the Court of Appeals. But unlike in some other jurisdictions, the frivolous claim standard in Missouri does not require that the plaintiff act in good faith or have a good faith basis for filing his or her claim, the court noted.

According to the court, a case would be considered frivolous for the purpose of a fee award if it “simply rehashed the arguments that [past] decisions had already rejected.” The garnishees’ case was not frivolous because the garnishment process had changed since Westerhold. Moreover, Westerhold did not address the filing of interrogatories.

Sufficient Evolution of the Facts and Law

Although the Missouri Court of Appeals had already addressed the issue of whether filing garnishments constituted the unauthorized practice of law at the time the garnishees initiated Mitchell, legally relevant factual distinctions supported their case. This allowed the garnishees to raise new arguments before the court, explains Tracy A. DiFillippo, Las Vegas, NV, cochair of the Section of Litigation’s Pretrial Practice & Discovery Committee.

“You have to look at the individual facts and how they apply to legal precedent,” DiFillippo advises. One such example cited in the Mitchell opinion was technological advances, which may lead to new arguments if their impact would extend or modify decisions made under existing law.

Amendments to governing law could also provide a hook for a new claim on a previously decided issue, counsels John M. Barkett, Miami, FL, cochair of the Section’s Ethics & Professionalism Committee. “Where a statute or regulation has been amended since the earlier precedent, there is a good faith basis for arguing for a change in the law,” Barkett concludes.

Takeaways for Litigators

In sum, Section leaders advise that, in order to avoid filing a claim that could be dismissed as frivolous, attorneys should make sure that a new case has materially distinguishable facts from prior precedent. If not, attorneys should make sure that there is a reasonable basis for seeking a modification or extension of precedent, or rejecting or refuting precedent, such as an amendment to a governing statute, regulation, or policy.


R'iele J. Sim is a contributing editor for Litigation News.

Hashtags: #frivolousclaims #garnishmentlaw #avoidlegalsanctions

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