Suit alleging that firm maneuvered to convert an undisclosed $6 million settlement into fees without consent by 600 clients transferred from Alameda to L.A.

2013 was a turbulent year in the class action world and in mine.  As a result, there were some newsworthy stories I didn't have time to cover this past year.  One such news story involves the transfer to Los Angeles County of a suit alleging a scheme to transform most or all of $6 million settlement into attorney's fees without fully disclosing the scheme to roughly 600 clients until it was too late for them to do anything about it.  Here's how Courthouse News Service summed up the shocking allegations:  "A California law firm accepted a $6 million 'secret settlement' of a labor class action against a bank, agreed to dismiss the claims without telling 600 clients, then tried to convert the whole settlement into legal fees, a class action claims in state court."  Jamie Ross, Class Claims Lawyer Took 'Secret' $6M Deal, Courthouse News Service (October 22, 2012).  Who would do such a thing?  Courthouse News Service identified the defendants in the proposed class action suit: " Lead plaintiff Kendra Cutting sued Mark Yablonovich; an attorney in his law office . . . , and The Law Offices of Mark Yablonovich, in Alameda County Court."  Ibid.  It appears from the docket that the attorney in Mr. Yablonovich's office was dismissed with prejudice from the action not too long after it was filed.

Courthouse News Service wasn't alone in covering these disturbing allegations.  For example, Law360 noted, "Because the Yablonovich lawyers allegedly did not first approve the deal with their clients, the Cutting complaint said the firm's actions represented a breach of fiduciary duty and legal malpractice."  Scott Flaherty, LA Attys Sued Over 'Secret' $6M Wells Fargo OT Settlement, Law360.com (October 19, 2012). 

Anyhow, in April 2013, Alameda sent this fine example of what not to do to clients to Los Angeles.  I guess that Northern California felt that Los Angeles wasn't grimy enough already.  You can read the original complaint here.  Or, better yet, get the whole thing here.  The case appears to be stayed while appeals involving Initiative Legal Group are pending.  Those appeals can be viewed here and here.  But you can check on the status of the L.A. Superior Court action by using the Case Summaries tool and entering case number BC512429.