6 5 09 in Re Mirch Objection to Report and Recommendations 80074 Doc 31 27 Pages

7/29/2019 6 5 09 in Re Mirch Objection to Report and Recommendations 80074 Doc 31 27 Pages

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Mirch Law OfficesKevin J. MirchCA SBN 106973Marie C. MirchCA SBN 20083, NV SBN 6747444 West C Street, Suite 320

San Diego, CA 92101(619) 501-6220/6389(619) 501-6980 Fax

Attorneys for Respondent

UNITED STATES COURT OF APPEALS

FOR THE NINTH CIRCUIT

IN RE: ) No. 08-80074)

Kevin John Mirch, Esq. ) [Partial] OBJECTION TO REPORT AND) RECOMMENDATION

Admitted to the Bar )of the Ninth Circuit )

)Respondent )

____________________ )

Comes now Respondent, Kevin John Mirch, in pro per and through his counsel,

Marie Mirch, and hereby submits the following objection to report and

recommendation dated April 3, 2009.

1. The Ninth Circuit Court of Appeals has the authority and obligation toexamine the due process violations in the underlying state case. (i.e., JudgeHardestys order issued by the State of Nevada District Court).

a. The Hardesty order is very relevant and taints the entire

disciplinary process

The Recommendation concludes that Mirchs allegations concerning due

process violations and insufficiency of the evidence in the underlying state civil

Case: 08-80074 06/05/2009 ID: 6948003 DktEntry: 31 Page: 1 of 27


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lawsuit (Mirch v. McDonald Carano, et. al.) are irrelevant to the present inquiry as

to whether this Court should accept the findings of the Nevada State Bar.

Recommendation at p. 16.

Respondent objects to this conclusion as the errors in the underlying civil suitand Judge [now Justice] Hardestys order are the very crux of the disciplinary action

against Mr. Mirch. There is no dispute that the Hardesty order solely comprised the

disciplinary complaint against Mr. Mirch and that the State Bar Disciplinary Board

adopted and incorporated by reference each and every factual finding and legal

finding in its prosecution of Mr. Mirch.

This cannot be ignored, as the Commissioner acknowledges the interaction of

the Hardesty order to the disciplinary proceedings, and has determined that the

Hardesty order is troublesome. For instance, the Recommendation acknowledges

that, (1) [A] review of the record, however, suggests that at least some parts of

Mirchs action against MCW and Goddard were not legally frivolous; (2) Judge

Hardestys order misunderstood the role of the alleged bankruptcy fraud in Mirchs

amended complaint, and as a result, the allegations against Leigh Goddard appeared

patently ridiculous insofar as the alleged fraud began when Goddard was still inschool. The amended complaint alleged that MCW and Goddard conspired to

perpetuate the fraud and prevent its disclosure, not that they were somehow involved

in the events that occurred years before they became Dr. Franks counsel...The panel

thus perpetuated Judge Hardestys misunderstanding of the amended complaint.p

26 of recommendation.

b. The Nevada Supreme Court improperly affirmed Chief Justice

Hardestys Order against Mirch

On March 6, 2008, the Nevada Supreme Court (of which James Hardesty sits

as Chief Justice) entered an Order affirming the district courts sua sponte ruling in



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favor of the prestigious law firm of McDonald, Carano, Wilson. The Nevada Court

concluded that the district court did not misstate or misapprehend facts or evidence

submitted, agreed with Hardestys conclusion that the lawsuit was frivolous, and

affirmed the draconian award of sanctions against Mr. Mirch.Mr. Mirch, through undersigned counsel, filed a petition for rehearing to the

Nevada Supreme Court arguing that the Nevada Supreme Court (1) overlooked and

misconstrued material facts and questions of law, (2) overlooked, and/or misapplied

and failed to follow a procedural rule (NRCP 56), and a decision directly controlling

a dispositive issue in the case (i.e. Clark v. Columbia HCA).

This is an ugly case. A lawyer sued opposing counsel for threats that were

made, which have come to fruition (sued for malpractice, criminal charges, and

disbarment). The district court took a renegade approach to the matter, but that same

district court judge now sits on the Nevada Supreme Court yielding tremendous

power. The ugliness of the facts in this case have caused the district court, and now

the Nevada Supreme Court, to dispense with constitutional rights, legal rights,

discovery rights, and well established principals of law in order to justify a speedy

disposition against Mr. Mirch.i. The Order Misapplied Well Established Law Directly

Controlling the Outcome of the Case.

The Nevada Supreme Court misapplied directly controlling precedent in its

analysis of a dispositive issue. N.R.A.P. 49(c)(2)(ii). Specifically to support the

conclusion that the district court properly entered summary judgment, this Court fell

to MCWs red-herring argument. (i.e., character assassination of Mr. Mirch) as a

basis for summary judgment, and threw the well established legal requirements of dueprocess, notice, and summary judgment out the window. By excusing its fellow

Justices violation of Mr. Mirchs constitutional guaranty of due process, the Nevada

courts violated the United States and Nevada Constitution, and the controlling case



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law established in Celotex Corp. v. Catrett, 477 U.S. 317, 326, 91 L.Ed. 2d 265 106

S. Ct. 2548 (1986) (court may enter summary judgment sua sponte as long as the

losing party was on notice he had to come forward with all of his evidence);Soebbing

v. Carpet Barn, Inc., 109 Nev. 78l 847 P.2d 731(1993) (Regardless of a claims merit,a district court may not sua sponte enter summary judgment against it until the law

requiring notice and a reasonable opportunity to be heard).

In this case, there is not evidence that Mr. Mirch knowingly and voluntarily

waived his right to constitutionally adequate notice. (i.e., to change a motion to

dismiss and for sanctions to one for summary judgment). To the contrary,

throughout the record, Mr. Mirch asserts his right to notice. Opening Brief at 21-22.

Hearing Transcript at 67:7-19, pp. 69-74. Mr. Mirch even moved to strike the

evidence MCW offered in support of their motion to dismiss, and t MCW responded

that their evidence was not submitted in support of the motion to dismiss, but to

support the motion for sanctions.

The Nevada court made a factual error in stating that Mr. Mirch waived notice.

Order at 4.Waiver is an intentional relinquishment or abandonment of a known

right or privilege. D.H. Overmyer Co. Inc. Of Ohio v. Frick Co.,405 U.S. 174, 185,92 D. S.Ct 775, 782, 31 L.Ed.2d 124 (1972),Johnson v. Zerbst, 302 U.S. 458, 462

(1938); and as the United States Supreme Court has said in the civil area, we do not

presume acquiescence in the lost of fundamental rights, Ohio Bell Tel. Co. v. Public

Utilities Commn, 301 U.S. 292, 307 (1937). That standard is not satisfied here. The

fundamental requirement of due process is the opportunity to be heard. Grannis

v. Ordean, 234 U.S. 385, 394. It is an opportunity which must be granted at a

meaningful time and in a meaningful manner. Armstrong v. Manzo Et. Ux, 380 U.S.

545, 85 S. Ct. 1187, 13 L. Ed. 2d 62 (1965). Mr. Mirch went to the courthouse

prepared for a motion to dismiss. Mr. Mirch did not have all of his evidence with him



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to oppose a summary judgment motion, because there was no notice that a summary

judgment was to be heard. The record confirms that the hearing was on a motion to

dismiss. The due process requirement of adequate notice is not waived by appearance

at a hearing In Re Gault, 387 U.S. 1, 87 S.Ct. 1428, 18 L. Ed. 2d 527 (1967).Furthermore, converting the motion well into the hearing was not notice at a

meaningful time, and provided Mr. Mirch no opportunity to retrieve his evidence.

In the present case, the trial court fully denied this right to Mr. Mirch, when even at

the hearing, the district court expressed its indecision in whether it would convert the

motion to dismiss into a summary judgment:

THE COURT: Well, the Court probablywill convert this to a motion for

summary judgment. The parties have referenced a lot of material outside of thepleadings, and so I might be inclinedto do that.

Transcript of Hearing at 59:6-9.

In fact, throughout the hearing, the district court acted as if it were ruling on

a motion to dismiss:

THE COURT: Well, at that point lets suppose, as I am required to doon a motion to dismiss...

Transcript at 33:24-34:1

THE COURT: Soeven if I accept as truethat Ms. Goddard and her firmhere engineered the bankruptcy fraud you have described, where is the harm?

Transcript 65: 10-15

Well into the hearing, the district court states that it is compelled to consider

the motion as one for summary judgment. Transcript 76:19-20,and goes forward

with a hearing despite Mr. Mirchs prior objections. This sua sponte act of the district

court violated Mr. Mirchs right to ten days notice, which the Nevada court finds

acceptable. Order at p. 4. Even if the Nevada Supreme Court were attempting to

overrule the ten day notice requirement discussed in Soebbing,such a step should not

be accomplished by a three-justice panel in an unpublished order. Cf. Matter of the



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Marriage of Cray, 867, P.3d 291, 297 (Kan. 1994) (if an appellate court decides to

overrule another panel of the same appellate court, it should be done, at a minimum,

by an en banc review and decision).

The absence of notice to Mr. Mirch is not excusable even under the harmlesserror rule. In that regard footnote 8 at page 4 of the Nevada Supreme Court Order

states thatthe failure to comply with the notice requirement of NRCP 56 is subject

to harmless error. Exber, Inc. v. Sletten Construction Co. 92 Nev 721, 558, P.2d

517, 524 (1976). In Exber, a motion for summary judgment in favor of a party

joining in another partys motion at the hearing was not prejudicial to the non-moving

party because the court already had before it a motion for summary judgment which

was joined at the hearing. Unlike the present case, the parties inExber knew that

they were going to the courthouse to defend a motion for summary judgment, so there

was no prejudice. The district court may allow a shortening of the 10 day notice

requirement, but only if the opposing party would not suffer prejudice. Cheek v. FNF

Constr. Inc. 112 Nev. 1249, 924 P.2d 492 (1954).

In this case, Mr. Mirch was given no notice whatsoever, and was extremely

prejudiced. He was denied any discovery, the district court cut short questions at thehearing (Opening Brief 23-26) (Transcript 85-87, 97), and denied leave to file a

written opposition and evidence against summary judgment. That evidence

included, but was not limited to: an affidavit of a witness who heard Ms. Goddard

tell Dr. Frank to destroy his fee contract, testimony of Marilyn Bulloch that Dr. Frank

told her that he was told by his attorney to destroy the contract, expert witness

testimony by affidavit of the bankruptcy issues, and the controlling order of the U.S.

Bankruptcy Court in the Frank bankruptcy case. VIII AP 1604.

The district courts denial of due process to Mr. Mirch was not harmless error.

At a minimum, the Nevada court should have reversed the order of summary



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judgment and remanded the case to provide Mr. Mirch the opportunity to file an

opposition to motion for summary judgment.

ii. The Nevada Supreme Court Misapplied or Overlooked a ProceduralRule Directly Controlling a dispositive Issue in the Case

A. Notice Requirement

In determining whether MCW was entitled to summary judgment, this Courts

Order correctly states this standard at page 3 and 4 of the Order. However, later in the

Order, the Court excuses the notice requirements of NRCP 56, United States Supreme

Court, and Nevada Supreme Court case law by finding that Mr. Mirch waived the

same. Order at p. 4.

The Order overlooked material facts and overlooked and misapplied NRCP 56and the applicable Nevada standard for granting summary judgment. Mr. Mirch was

entitled to ten days notice regardless of the merits. Cheek v. FNF Constr. Inc. , 112

Nev 149, 929, P.2d 1347 (1966). Mr. Mirch specifically requested notice. Opening

Brief at 21-22, Hearing Transcript at 67: 7-19, pp. 69-74. For these reasons, to

the extent that the Nevada Supreme Court order concludes that Mirch waived notice

and suffered no prejudice, it overlooks and misapplies NRCP 56 and overlooks

material facts in the record.

B. Burden on Moving Party

Furthermore, MCW never moved for summary judgment and never met their

burden of affirmatively demonstrating the absence of a genuine issue of material fact.

Celotex Corporation v. Catretta, supra. Opening Brief at 23. In Celotex Corp. v.

Catrett, 477 U.S. 317, 325 (1986), the Court specifically stated.

Of course, a party seeking summary judgment always bears the initialresponsibility of informing the district court of the basis of its motion, and identifyingthose portions of the pleadings, depositions, answers to interrogatories, andadmissions on file, together with affidavits, if any, which it believes demonstrate theabsence of a genuine issue of material fact.

The Nevada Court ignored this standard.



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In order for a Motion for Summary Judgment to granted, evidence must be

submitted. The evidence submitted is subject to special rules under NRCP 56(e).

Under Rule 56, the moving party must identify and offer admissible evidence of

specific facts showing that there is not genuine issue for trial. See, Anderson v.Liberty Lobby, 477 U.S. 242, 91 L.Ed2d 202 (1986);MatsuhitaElectronic Industrial

Co. v. Zenith Radio Corp., 475 U.S. 574, 89 L.Ed. 2d 538, 106 S. Ct., 1348 (1986).

Summary judgment cannot not lie where there is the slightest doubt as to the

operative facts. Washoe Medical Center v. Churchill County, 108 Nev. 622, 625, 836

P.2d 624, 626, (1992). The courts have also stated that summary judgment should not

be granted unless the truth is clear, or unless the moving party demonstrates a right

to a judgment with such clarity that there is no room for controversy, and the

opposing party cannot prevail,Poller v. Columbia Broadcasting Systems, Inc.,82

S.C. 486, 368 U.S. 464, 7 L.Ed.2d 458. This Court misapplied this standard in

affirming the district courts order.

MCW did not move for summary judgment, they moved to dismiss. They

expressly restricted the matters outside the pleadings to their motion for sanctions,

and Mr. Mirch responded as such. There was absolutely no evidence offered insupport of summary judgment. The Respondents did not even deny the threats which

Mr. Mirch alleged in this lawsuit. By affirming summary judgment in the absence of

any evidence supporting the same, the Nevada Supreme Court ignored the

requirements of NRCP 56.

iii. The Nevada Courts Failed to View the Evidence in Favor of theNonmoving Party

In deciding a motion for summary judgment, the non-moving party is entitledto have evident and all reasonable inferences accepted as trued. Order at p. 4

Posadas v. City of Reno,109 Nev. 448, 452, 851 P.2d 438 , 441-42 (1993). The

Nevada courts failed to exercise this standard.



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[T]he district court correctly found that Mirch could not, as a matter of law,

establish the elements of an existing contract and therefore, an intentional act of

interference. As to Mr. Mirchs purported existing contract with Frank, the very crux

of the disputed between Mirch and Frank was whether a valid contingent feeagreement existed between the two. Order p. 8. The Court recognizes that there

was a dispute between Mirch and Frank as to whether a contract existed, yet fails to

view this in the light most favorable to Mirch (i.e., that a contract existed). Rather the

Court accepts Franks position that there was no contract. The existence of the

contract itself was a material fact in dispute which was not the proper subject for

dismissal through summary judgment.

iv Nevada Courts Misapprehended Material Facts

1. Mr. Mirch did not waive notice. See discussion above.

2. Mr. Mirch did not ask the district court if he could present

witnesses in the event the district court chose to treat the motion to dismiss as a

motion for summary judgment. Order p 5. The witnesses were subpoenaed and

presented solely to defeat the motion for sanctions. Reply Brief p. 5.

3. The federal court had not "already held that there was noconspiracy to commit bankruptcy fraud" Order p 6. The federal orderI APP 107-114,

does not even approach the issue of bankruptcy fraud.

4. Mr. Mirch was not a party to the federal action that rendered the

decision pertaining to Dr. Frank's bankruptcy. Order p 7 The Nevada Court cites in

footnote 14 to the federal suit where Mirch sued Frank, Mirch v. Frank U.S. District

Court Case No. CV-N-01-0443 (2003). This is not the case in which the federal court

entered an order pertaining to assets of Frank's bankruptcy estate in September 2000.

That was case number CV-N-91-375 Universal Sales, Inc. v. Advanced Physicians

Products, Inc.. Mr. Mirch was not a party to that case. This is a mistake of fact which



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this Court used to determine that the conspiracy claim was barred by collateral

estoppel and that "Mirch knew or should have known that Frank had no duty to

disclose the judgment to the creditors, in light of the federal court's decision". Order

p 10. The Court further affirmed the NRCP 11 sanctions against Mirch, finding thecase was frivolous, also based on this mistake of fact and collateral estoppel. The

Court cannot affirm based on these erroneous facts.

5. The Nevada Courts totally ignored the order of the United States

Bankruptcy Court, Central District of California which required Dr. Frank to turn all

of his assets over to the bankruptcy trustee. Contrary to the Nevada courts

interpretation, Mr. Mirch was not asking the district court to make a ruling pertaining

to the bankruptcy estate, but to recognize that there was a valid order still in effect

which controlled. When this fact is included in the analysis, the Nevada courts could

not have made the finding that this case was without merit and lacked factual and

legal support.

iv. The Nevada Courts ignore Nevada Case law Concerning theWhistle blower claim

In the Order of Affirmance, the Nevada Supreme Court states that "Mirch's

whistle blower claim is a non- cognizable claim because a whistle blower claim under

NRS 281.641 protects only a state employee or officer for disclosing unlawful

activities". Order at p 7. This holding ignores existing state law which recognizes a

whistle blower claim outside of the employment context and outside NRS 281.641.

The case that the Nevada courts totally ignore and fail to follow is Clark v.

Columbia\HCA,117 Nev. 468; 25 P.3d 215 (2001). The Nevada Supreme Court has

specifically recognized a whistle blower claim outside of NRS 281.641 and outsideof the employment context:

In his complaint, Clark has alleged tortuous conduct byrespondents in the peer review board's decision toterminate his staff privileges. He has also alleged that



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respondents terminated his staff privileges because hereported violations of medical standards - conduct weprotect as a matter of public policy as whistle blowing.See Wiltsie v. Baby Grand Corp., 105 Nev. 291, 293, 774P.2d.432, 433 (1989); see also Allum v. Valley Bank of

Nevada, 114 Nev. 1313, 1321-22,970 P.2d 1062, 1066-67

(1998) Because Clark has alleged conduct that isactionable under our state laws, this court hasjurisdiction to hear this case.

Clark, supra at 476.

The doctrine of stare decisis is an indispensable principle necessary to this

court's jurisprudence and to the due administration of justice. That doctrine holds that

"a question once deliberately examined and decided should be considered as settled.

The fact that Nevada recognizes a whistle blower claim outside of an employment

context, as the Nevada Supreme Court held in Clark, should have been dispositive of

the issue as to whether Mr. Mirchs amended complaint contained a cognizable claim.

This argument is not post hoc or made in hindsight by Mr. Mirch (as the

Commissioner in the Recommendation suggests of Mr. Mirchs arguments) but

contained in page 19 of his opposition to motion to dismiss.

Finally, the Nevada courts totally ignored other statutory authority for a

whistle blower claim, NRS 41.635 through 670, the anti-slapp statutes.The Nevada courts decisions to ignore the holding in Clarkand recognize

controlling statutory and case law permitting a whistle blowing claim should not be

afforded any presumption of correctness by the Ninth Circuit as they are a blatant and

intentional misinterpretation and/or ignorance of the law concerning civil whistle

blowing in the State of Nevada.

It should be noted that had Mr. Mirch not advised Ms. Goddard that she was

obliged to inform the bankruptcy court of Dr. Franks failure to report the USI v.

APPI judgment as an asset of the bankruptcy estate as required by Judge Riblet,



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Rule 8.4 of the Model Rules of Professional Conduct stipulates, in part, that "it is1

professional misconduct for a lawyer to: (a) violate or attempt to violate the Rules of Professional

Conduct, knowingly assist or induce another to do so, or do so through the acts of another; .... (c)

engage inconduct involving dishonesty, fraud, deceit or misrepresentation." MODEL RULES

OF PROF'L CONDUCT, R. 8.4 (2003).

12

that would have been an ethical violation by Mr. Mirch. It is a fair characterization1

of the lawyer's responsibility in our society that he stands "as a shield," ... in defense

of right and to ward off wrong. From a profession charged with such responsibilities

there must be exacted those qualities of truth-speaking, of a high sense of honor, ofgranite discretion, of the strictest observance of fiduciary responsibility, that have,

throughout the centuries, been compendiously described as "moral character."

Mr. Mirch did not purport to represent any of the Doe Plaintiffs in the

amended complaint, as this Court surmises on page 5 of theRecommendation. None

of the three claims for relief are brought on their behalf. Mr. Mirch named the Doe

parties to avoid dismissal for failure to name an indispensable party. The three

claims (interference with contract, conspiracy, and whistle blowing) were all on

behalf of Mr. Mirch as the Plaintiff and all were supported by fact and law. The

district court (Hardesty), the State Bar, and the Nevada Supreme Court all fell victim

to the red herring articulated by MCW counsel Bruce Laxalt throughout the civil case

and in the bar hearing (i.e., it defies time and space that Ms. Goddard could engage

in any bankruptcy fraud when she was merely a young girl in high school at the time

Dr. Frank filed bankruptcy). This argument is patently ridiculous and even a noviceattorney or judiciary in the State of Nevada would recognize it as a poor excuse to

base dismissal of a conspiracy claim and subsequent disbarment. The Nevada courts

and disciplinary panels eagerness to accept anything Mr. Laxalt said in favor of

MCW is also evident in the acceptance of his argument that Mr. Mirch has a pattern

of practice of suing opposing counsel. At the disciplinary hearing when Mr. Laxalt



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was asked what counsel in the cases footnoted in his motion to dismiss were ever

sued by Mr. Mirch, he responded none!.

While this Court must begin by giving deference to the decisions of the Courts

of the great State of Nevada, it must not condone total abandonment of basic legalprincipals by the Silver State because the district court judge now sits as Chief

Justice of the Nevada Supreme Court, and the subject matter is ugly.

The only way the Nevada courts rulings can be given deference is if the Court

put blinders on to the law and facts of this matter. The record does not support the

absence of notice, or a conclusion that despite the absence of notice, Mr. Mirch was

not prejudiced. Mr. Mirch has been prejudiced by not only denial of his right to

petition the state for his grievance, but also through sanctions in excess of $60,000

and the stripping of his license to practice law and his livelihood based on incorrect

interpretation of facts and application of law.

The district courts action was unconstitutional, and this Court has the authority

and duty to recognize the shortcomings in the Nevada decisions and make its own de

novo ruling on the matter.

2. Errors of fact in RecommendationThe Appellate Commissioner concluded that Even if this court were to

conclude that there is insufficient evidence to support the state bar panels conclusion

that Mirchs amended complaint lacked a legal basis, it is clear that the panels

decision was also based on a finding that Mirchs complaint lacked a factual basis

p. 27. In supporting the conclusion that there was no factual basis for the amended

complaint, the Court notes that Mr. Wisemans affidavit did not appear in the

opposition to motion to dismiss, and therefore that supports the bars finding that the

factual allegations were fabricated. The Court cannot use part of the underlying state

case to support its adoption of the discipline against Mirch, and refuse to examine



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the propriety of the order in the underlying civil action. Mr. Wisemans affidavit

was not used in opposition to the motion to dismiss because it was a motion to

dismiss NOT a motion for summary judgment! It was used in Mirchs motion to

reconsider which was denied by Judge Hardesty, which Earlene Forsythe testified wasjust days after Justice Hardesty benefitted from approximately $60,000 in campaign

funding at an event sponsored by Pat Lundvall a general partner of MCW.

3. Nevadas failure to follow basic rules of civil procedure and stare decisisvitiates the Ninth Circuits deference to the Nevada rulings

Fruit of the Poisonous Tree Analogy

The fruit of the poisonous tree doctrine is an exclusionary rule in criminal

cases that prohibits the introduction of evidence that is causally connected to anunlawful search. (People v. Neely(1999) 70 Cal.App.4th 767, 785 [82 Cal. Rptr. 2d

886].) In the area of constitutional law, the fruit of the poisonous tree doctrine

supplies an exclusionary rule that is designed to deter police misconduct.

In re Ruffalo, 390 U.S. 544, 550, 20 L. Ed. 2d 117, 88 S. Ct. 1222 (1968), the

Supreme Court held that because "disbarment, designed to protect the public, is a

punishment or penalty imposed on the lawyer," the accused lawyer "is accordingly

entitled to procedural due process .. . ." The Court characterized disbarment actions

as "adversary proceedings of a quasi-criminal nature."Id.at 551. The Second Circuit

has expanded upon Ruffalo, explaining that "a court's disciplinary proceeding

against a member of its bar is comparable to a criminal rather than to a civil

proceeding."Erdmann v. Stevens, 458 F.2d 1205, 1209 (2d Cir. 1972). Central to the

reasoning inErdmannwas the court's acknowledgment that disbarment is punitive

in nature: "For most attorneys the license to practice law represents their livelihood,loss of which may be a greater punishment than a monetary fine."Id.at 1210.

Because a bar disciplinary hearing is quasi-criminal in nature, a "fruit of the

poisonous tree" type remedy should be applied to deter conduct such as the judicial



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misconduct behind the Hardesty order (failure to follow rules of civil procedure,

failure to follow Nevada case law, failure to understand the facts underlying the

claims, and accepting campaign contributions from MCW while Mirchs case against

them was pending). (See U.S. v. Marashi(9th Cir. 1990) 913 F.2d 724, 731 [no courthas ever applied the fruit of the poisonous tree doctrine to violations of evidentiary

privileges].)

While the fruit of the poisonous tree doctrine per se may be inapplicable to the

bar proceeding, the impetus for the disciplinary case against Mr. Mirch comes from

a tainted order. As this Court recognized, Judge Hardestys misunderstandings

carried through to the members of the disciplinary panel. The Bars failure to conduct

its own independent investigation and mere incorporation of Hardestys order as the

complaint against Mr. Mirch is invited error. Unlike a party to a civil action, a person

who files an ethics grievance has no standing as a party, and the mere allegation of

misconduct does not need to be accepted as true. The initiation of a disciplinary

investigation against a lawyer is a serious matter that should not be initiated by the

court based on innuendo or rumor. Romero-Barcelo, v. Acevedo-Vila, 275 F. Supp.

2d 177; 2003 U.S. Dist.Ct. Puerto Rico). "Under the doctrine of invited error, adefendant cannot by his own voluntary conduct invite error and then seek to profit

thereby."Phillips v. State, 527 So. 2d 154, 156 (Ala. 1988) ... In this case, MCW

invited the error by promulgating false facts in support of their motion to dismiss,

and then profited from it by executing Ms. Goddards threats against Mr. Mirch of a

lawsuit for malpractice against Mirch on behalf of Frank and obtaining an order of

disbarment based on a complaint from a judge who MCW openly supported in his

campaign to sit on Nevadas high court.

4. The background underlying Hardestys order cannot be ignored

Respondent objects to the recommendation as it treats Hardestys decision to



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convert the motion to dismiss into a motion for summary judgment as a non-issue,

stating that the motion to dismiss was converted to a motion for summary judgment

because both parties introduced evidence beyond the pleadings. Recommendation

at p 5.. This is factually incomplete. Neither parties introduced evidence beyond thepleadings with respect to the motion to dismiss, rather both sides made it abundantly

clear that the exhibits and testimony offered were for purposes of the motion for

sanctions only, not to convert the motion to dismiss into one for summary judgment:

Judge Hardestys order and referral to the State Bar was based on no evidence

whatsoever. The Nevada State Bar was obliged to conduct an independent

evaluation, and it failed to do so, thus leaving the underlying order and the propriety

of the proceedings below quite relevant to this Courts inquiry.

Not only is the underlying order tainted because of the district courts failure

to follow the rules of civil procedure and the established statutory and case law in

Nevada, the Bar also failed to follow its own duty to investigate: Nevada Supreme

Courts dictate State Bars duty to investigate a grievance:

Rule 104. State bar counsel.

1. State bar counsel shall: (a) Investigate all matters involving possible attorney misconductor incapacity called to bar counsels attention, whether by grievance orotherwise. (b) Subject to Rule 105(1), dispose of all matters involving allegedmisconduct by dismissal of the allegation(s) or by the filing of a writtencomplaint. (c) Prosecute all proceedings under these rules before all forums inthe name of the State Bar of Nevada. (d) File with the supreme court petitions with certified copies of

proof of conviction demonstrating that attorneys have been convicted ofserious crimes, as defined in Rule 111. (e) Maintain permanent records of all matters investigated under

these rules except as otherwise required under Rule 121.

The Nevada State Bar failed to conduct an independent investigation, but rather

relied on a tainted order from district court. It is ironic that Mr. Mirch is disbarred



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for failing to investigate before filing his action, yet the State Bars failure to

investigate is sanctioned by Justice Hardestys Supreme Court.

In summary, the underlying order is tainted which taints the entire disciplinary

process. The Court should apply a fruit of the poisonous tree analysis and rejectthe state bars actions against Mr. Mirch because they are rooted in a gross

misapplication of basic rules of civil procedure, stare decisis, and procedural due

process.

5. The severity of the discipline

"[O]nly the most serious instances of repeated misconduct over a prolonged

period of time and multiple instances of misappropriation have warranted actual

suspension, much less disbarment." (Lawhorn v. State Bar(1987) 43 Cal. 3d 1357,

1367 [240 Cal. Rptr. 848, 743 P.2d 908].) This is not such a case. It may also be

noted that the standards provide that if the misconduct does not "demonstrate a

pattern," the appropriate discipline is reproval or suspension. (See std. 2.4 (b).)

A court imposing sanctions must consider (a) the duty violated; (b) the

lawyer's mental state; (c) the actual or potential injury caused by the lawyer's

misconduct; and (d) the existence of aggravating or mitigating factors. "Any courtwhich has the power to admit attorneys to practice may also sanction them for

unprofessional conduct." Standing Comm. on Discipline v. Ross,735 F.2d 1168, 1170

(9th Cir. 1984). "In the federal system there is no uniform procedure for disciplinary

proceedings."Id. The individual judicial districts are free to define the rules to be

followed and the grounds for punishment. See 28 U.S.C. @ 1654. Federal district

courts are bound by the disciplinary rules they implement when proceeding against

attorneys for violation of ethical standards.Dailey v. Vought Aircraft Co., 141 F.3d

224, 230 (5th Cir. 1998);Matter of Thalheim, 853 F.2d 383, 386, 388 (5 Cir. 1988);th

United States v. Stoneberger, 805 F.2d 1391, 1393 (9th Cir. 1986);Matter of Abrams,



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521 F.2d 1094, 1104-05 (3d Cir. 1975).

The Ninth Circuit has stated that, "it is vital for a court clearly to state the basis

of its ruling, so as to permit appellate review of whether relevant factors were

considered and given appropriate weight." Valley Broadcasting v. U.S. District Court,798 F.2d 1289 at 1294 (9 Cir. 1986) (quoting Edwards, 672 F.2d at 1294). Inth

Valley Broadcasting the Ninth Circuit reversed an order to seal court documents and

remanded where the district court failed "to articulate any reasoning or findings

underlying its decision to seal the decree."EEOC v. Erection Co., 900 F.2d at 169.

Here, Judge Hardestys order fails to make factual findings to aid Mr. Mirch

in the defense of the disciplinary action, yet the disciplinary panel nonetheless makes

its own findings of fact based on insufficient evidence, and deference and

acceptance of Judge Hardestys order. In light of the fact that the State Bar failed in

its duty to conduct an independent investigation, but rather merely adopted and

physically attached Judge Hardestys order as the ethical complaint against Mr.

Mirch, this Court does have the authority and duty to review the circumstances of fact

and law that undermine the Hardesty order.

6. Additional Factual errors in the RecommendationThe Court has exhibited a profound understanding of the procedural and legal

issues related to the circumstances leading to the disbarment of Mr. Mirch in Nevada.

However, there are a few key facts which are misinterpreted or misstated in the

recommendation that should be clarified. Factual errors in the recommendation for

order in the underlying state case include:

a. Mr. Mirch did not purport to bring any claims or counts of the amended

complaint on behalf of Doe Plaintiffs (Recommendation at p. 5) ,

Rather he included the Does to avoid dismissal for failure to name an

indispensable party.



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b. That the underlying motion for summary judgment is irrelevant to the

analysis of the disciplinary process (Recommendation at p 16) Neither

party submitted matters outside the pleadings for the motion to dismiss,

it was specifically for the motion for sanctions. (Recommendation at p5)

c. Hardesty order did not provide detailed notice of the ethical violations

as Nevada Supreme Court held in disbarment order.

d. The fact that Mr. Mirch was not aware of Judge Reeds order is not

evidence of Mirchs failure to investigate. Rather, Mr. Mirch did a more

thorough investigation of the actual bankruptcy case, personally going

to the courts archives and retrieved Judge Riblets order, which was not

appealed and which is the law of the case. The parties in the USI v. APP

case did not present Judge Riblets order to Judge Reed. Judge Reeds

order is irrelevant as Judge Riblets order controls the bankruptcy assets.

e. Mr. Mirch did not have chance to challenge Judge Hardestys ruling at

the hearing as the bar panel quashed the subpoeana Mr. Mirch had

served on Justice Hardesty, thereby precluding Hardesty as a witness

7. The Recommendation fails to address whether the United StatesConstitution permits a taking of Mr. Mirchs property right (i.e. hislicense to practice law) under SCR 170 which this Court agrees is a vaguerule of ethical conduct.

The Commissioner in the Recommendation acknowledges legal uncertainty

about the nature of the charge against Mirch, and therefore what each side had to

prove at the hearing. Recommendation at p. 18. The Court quotes SCR 170, A

lawyer shall not bring or defend a proceeding, or assert or controvert an issue therein,

unless there is a basis for doing so that is not frivolous, which includes a good faith



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argument for an extension, modification or reversal of existing law. In the

Recommendation, this Court recognizes the legal uncertainty about nature of charges

against Mirch and what each side had to prove at the hearing. The Commissioner

further acknowledges that SCR 170 does not offer guidance on determiningfrivolous, the inherent ambiguity of the particular disciplinary charge against

Mirch, and cites only one published opinion in which SCR 170 was applied but not

interpreted in any extended way. In re Schaefer, 25 P.3d 191 (Nev. 2001).

In re Discipline of Schaefer, the Nevada Supreme Court addressed the issue of

whether former SCR 182 was unconstitutionally vague and began its analysis with

the following statement:

As stated by the United States Supreme Court in 1926, a statute or ruleis impermissibly vague if it "either forbids or requires the doing of anact in terms so vague that men of common intelligence must necessarilyguess at its meaning and differ as to its application." This remains thetest today. It is well-settled that, in evaluating whether a statute is vague,

judicial opinions construing the statute should be considered. "[T]hetouchstone is whether the statute, either standing alone or as construed,made it reasonably clear at the relevant time that the . . . conduct was[prohibited]."

In re Discipline of Schaefer,117 Nev. 496, 511-12, 25 P.3d 191, 201-02 (2001)

(footnotes omitted) (quotingConnally v. General Constr.Co., 269 U.S. 385, 391, 46S. Ct. 126, 70 L. Ed. 322 (1926), and United States v. Lanier, 520 U.S. 259, 267, 117

S. Ct. 1219, 137 L. Ed. 2d 432 (1997),respectively; citingBouie v. City of Columbia,

378 U.S. 347, 355, 362, 84 S. Ct. 1697, 12 L. Ed. 2d 894 (1964); Winters v. New

York, 333 U.S. 507, 514-15, 68 S. Ct. 665, 92 L. Ed. 840 (1948) (noting that an

individual is "chargeable with knowledge of the scope of subsequent interpretation"

of a statute);Minnesota v. Probate Court, 309 U.S. 270, 273-74, 60 S. Ct. 523, 84

L. Ed. 744 (1940);Lanzetta v. New Jersey, 306 U.S. 451, 456, 59 S. Ct. 618, 83 L.

Ed. 888 (1939);Hicklin v. Coney, 290 U.S. 169, 172, 54 S. Ct. 142, 78 L. Ed. 247

(1933);Bandini Co. v. Superior Court, 284 U.S. 8, 17-18, 52 S. Ct. 103, 76 L. Ed.



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136 (1931); andFox v. Washington, 236 U.S. 273, 277, 35 S. Ct. 383, 59 L. Ed. 573

(1915)). Proper to evaulate both the underlying state proceding with the bar

proceedings in looking at due process

In evaluating whether a statute is vague, judicial opinions construing the statuteshould be considered.In re Schaefer, supra. In addition, questions of vagueness must

be more closely examined where First Amendment rights are implicated.Ashton v.

Kentucky, 384 U.S. 195, 200, 16 L. Ed. 2d 469, 86 S. Ct. 1407 (1966); see alsoReno

v. American Civil Liberties Union,521 U.S. 844, 870-72, 117 S. Ct. 2329, 138 L. Ed.

2d 874 (1997) (noting that even if a statute is not so vague as to violate due process,

it may be impermissibly vague under the First Amendment if it chills protected

speech).

The disbarment of Mr. Mirch pursuant to SCR 170 has a chilling effect on the

exercise of First Amendment rights. The First Amendment states: "Congress shall

make no law respecting an establishment of religion, or prohibiting the free exercise

thereof; or abridging the freedom of speech, or of the press; or the right of the

people peaceably to assemble, and to petition the Government for a redress of

grievances. "U.S. Const. amend. I.Mr. Mirch had a factual, legal and constitutional basis to bring suit against Ms.

Goddard and MCW. SCR 170 is an ethical rule that should not form the basis for

taking Mr. Mirchs right to practice law and earn a livelihood in Nevada. The Nevada

courts cite an improper motive as the basis for the discipline. SCR 170 is not defined

by case law or by its incorporation into the ethical rules of the state. No binding case

law from Nevada courts interpreting SCR 170 was available during the time period

at issue.

SCR 170 does not clarify that an improper motive is grounds for disbarment.

NRCP Rule 11 is designed to curtail improper motive, and was used against Mr.



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Mirch to sanction him over $60,000 for bringing suit. The vague and ambiguous

SCR 170 is unconstitutional and cannot be recognized by this Court as a basis to

disbar Mr. Mirch.

The Recommendation does not address the issue of whether SCR 170 isconstitutional. It is well within the province of the federal appeals court to evaluate

and address this issue.

8. Quality and sufficiency of evidence in bar hearing.

One of the major areas of concern raised by Mr. Mirch is the quality and

sufficiency of the evidence at the bar hearing. The clear-and-convincing-evidence

standard has been recognized as the applicable standard in attorney discipline

proceedings. SeeRosenthal v. Justices of the S. Ct. of Cal., 910 F.2d 561, 564 (9th

Cir. 1990)("the burden is on the state to establish culpability by convincing proof and

to a reasonable certainty") The Supreme Court has defined the clear and convincing

standard "as that weight of proof which 'produces in the mind of the trier of fact a

firm belief or conviction as to the truth of the allegations sought to be established,

evidence so clear, direct and weighty and convincing as to enable the fact finder to

come to a clear conviction, without hesitancy, of the truth of the precise facts'" of thecase.Medrano,956 F.2d at 102 (quotingCruzan by Cruzan v. Dir., Missouri Dep't.

of Health, 497 U.S. 261, 285 n.11, 111 L. Ed. 2d 224, 110 S. Ct. 2841 (1990).

In the present case, this Court recognizes that the state bar panels decision, and

the Supreme Court order affirming it are strikingly perfunctory (p.21). The state

bars decision is marked with conclusory statements that do not demonstrate how the

findings flow from the evidence before it (p.22). This Court states on page 24 of

the Recommendation, A review of the record, however suggests that at least some

parts of Mirchs action against MCW and Goddard were not legally frivolous.

The record reflects that the expert witness for the Bar, Dennis Kennedy did not



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object to Mr. Mirchs expert, David Hamiltons analysis, with the exception of

whether the inquiry is objective or subjective. Mr. Kennedy assumed all of the facts

in the amended complaint to be true. Mr. Laxalt admitted that he had no knowledge

of the underlying facts in the amended complaint or the investigation that Mr. Mirchconducted before filing the same. In fact, Mr. Laxalt admitted that he did not have

a clear basis for his accusation that Mr. Mirch sued opposing counsel in a number of

cases as a pattern of practice. The only other witness on behalf of the Bar as to the

facts of the amended complaint was Ms. Goddard who unquestionably would not

admit to making the threats to Mr. Mirch or to telling her client to destroy the fee

contract, as that would expose her to disbarment.

On the other hand, the factual allegations in the amended complaint were

corroborated by Mr. Wisemans testimony; Mr. Hamiltons testimony ( he testified

that he heard Denise Reed, a former client of Mirchs, state that a woman from MCW

called her and told her not to pay Mr. Mirchs legal bill); a statement made in a

deposition under oath by Marilyn Bulloch who was deceased by the time of the

hearing, but who resided in Alabama and testified that Dr. Frank called her and told

her that his lawyer had told him to destroy Mirchs fee contract; and of course thetestimony of Mr. Mirch.

The Bar Panel summarily discredited the testimony of Mr. Wiseman, who in

addition to relaying the conduct he observed and heard at Mr. Mirchs office where

Ms. Goddard told her client to destroy the contract, diverted in his testimony and

lamented about his own personal problems with the local legal community which

turned a blind eye to his own case where it was discovered that the court reporter was

the sister of opposing counsel and had lost over 100 pages of witness testimony

concerning judicial corruption in Nevada.

As to the conduct of Mr. Mirch, which this Court recognized the bar panel used



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as an aggravating factor to impose discipline beyond what bar counsel was seeking

(i.e. disbarment as opposed to one year suspension), this Court characterizes Mirchs

testimony as vague, speculative and chronologically confused, but fails to address

the impact that Mr. Mirchs health had on him both physically and mentally. Duringthe hearing before this Court, Mrs. Mirch testified that Mr. Mirch had suffered a

stroke on April 1, 2006, less than one year before the bar hearing. His memory,

vision, fine and gross motor skills, receptive and expressive language and overall

health were adversely affected by the stroke. The panel was aware of this infirmity

as Mr. Mirch had to leave the hearing and be driven home because he fell ill at the

hearing, leaving Mrs. Mirch to defend her husband.

Mr. Mirch had an impaired facility for understanding and transmitting the

ideas of language in any form for a few years following his stroke. His wife and

counsel, Marie Mirch, has a masters degree in speech pathology and attested to Mr.

Mirchs impairments in his communication skills at the hearing before the

Commissioner. This is a fact that should be considered by this Court and weigh on

the credibility of the bar panels justification for disbarment. Mr. Mirch could not

seek a continuance because of his health, because under Nevada rules an attorneyfacing a disciplinary charge who seeks a continuance based on health must be put on

disability status, which in Mr. Mirchs case would have been a summary disbarment

with little or no chance for reinstatement.

Mr. Mirch was left at the mercy of a panel that had no regard for his physical

or mental health, and in fact included one member (Scott Freeman) who had opposed

Mr. Mirch in a civil matter in which the sanctions Mr. Freeman obtained against

Mirch were reversed by the Nevada Supreme Court. Romo v. Keplinger, 978 P.2d

964 (1999 Nev.). Panel members Mr. Freeman, Mr. Sourwine, and Kathy Price

were all competitors of Mr. Mirch in the Reno community and therefore Stivers v.



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Pierce, 71 F.3d 732,741 (9 Cir. 1995) does apply to the instant matter.th

Finally, given the fact that Dr. Frank defrauded creditors of the proceeds from

the judgment which Mr. Mirch had attained on his behalf by concealing this asset

from the bankruptcy court in contempt of an order from Judge Riblet, Mr. Mirch didthe moral and ethical thing required not only in the legal profession but in a civilized

society. He reported the asset to the bankruptcy court. That the bankruptcy court

failed to pursue the disclosure or that MCW absconded most of the judgment in legal

fees does not support the finding that Mr. Mirch failed to investigate the facts and

law alleged in his amended complaint.

Finally, Mr. Mirchs discipline was enhanced because he did not express

remorse. Mr. Mirch did express remorse at the hearing, in that he wished he never

filed the suit so that he would not be in a disciplinary hearing. However, had Mr.

Mirch done nothing and like the Nevada judiciary turned a blind eye to the

misconduct, then he would be deserving of professional and moral discipline.

9. Summary

The burden on Mr. Mirch to prove that reciprocal discipline is improper is

almost insurmountable. However, in this case an independent review of the record(including a review of the underlying civil case ofMirch v. McDonald Carano)

uncovers a forest of inequity.

a. Due Process

Mr. Mirch was denied due process in the Hardesty hearing on the underlying

case when he was prevented from defending a sua sponte motion for summary

judgment. Due process violations also evolve from the fact that SCR 170 is

unconstitutionally vague, ambiguous and violates his First Amendment Right to

petition the government with is grievance, and in fact now chills anyone who has the

gall to stand up to corruption in the Reno legal community. Further, the complaint



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filed by the Bar against him is unclear as to what specific acts, laws or facts Mr.

Mirch violated and give him no notice as to what conduct he is to defend. Finally,

the bar panel shifted the burden of proof from the bars obligation of clear and

convincing proof to Mr. Mirch to prove the underlying civil matter, Mr. Mirch wasnot afforded the opportunity to fully recover his neurological, motor and

communication skills before he was called to testify as a witness.

b. Insufficient proof of misconduct

The Bar failed to investigate the facts of the complaint whatsoever, despite the

disciplinary rules which require the same. The panel issued findings of fact with

no evidentiary basis for the same. It was merely an adoption of Judge Hardestys

misinterpretation of the amended complaint. The only witness the Bar presented was

the self serving testimony of Mr. Goddard who had an interest in protecting her job

with MCW and her license to practice law. On the other hand Mr. Mirch offered

factual evidence in the testimony of Mr. Hamilton, Mr. Wiseman, Ms. Bulloch

(through transcript), and Mr. Mirch himself even though he was impaired and

incompetent to fully comprehend the questions posed to him (receptive language) and

to explain his conduct (expressive language. In addition to the testimonial evidence,Mr. Mirch offered a large binder of his research and investigation of the matters that

he alleged in the suit. This research was done before he filed suit. A review of the

record does not support a finding that there are sufficient facts to support the

misconduct and the imposition of the ultimate sanction - disbarment.

c. Grave Injustice

For the sake of argument, assuming that the Bar was correct in finding that

there was no legal or factual basis for the amended complaint (which Mr. Mirch

vehemently disagrees), there was insufficient cause to impose the death penalty

sanction - disbarment. Mr. Mirch did have a prior disciplinary record, one private



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reprimand and one public reprimand, no sanctions and no suspensions. On the other

hand, there are a handful of lawyers in the Reno community that use the bar

disciplinary process as a litigation tool and have yielded this modus operandi against

Mr. Mirch in many complaints filed by competing lawyers that did not ripen into anydisciplinary action. Even the Rule 11 sanctions that were imposed in Ohio which the

Bar presented as aggravating circumstances were not acted on by the Nevada bar as

any type of ethical violation.

Mr. Mirch remains in good standing with the California bar and is an asset to

the public who otherwise may not afford to have their civil dispute heard in court.

With the exception of the present case, he has no cases now pending at the Ninth

Circuit. The Court should reject the Nevada Courts discipline and use its discretion

in determining that little or no discipline is warranted against Mr. Mirchs admission

to practice before this Honorable Court.

Respectfully Submitted this 5 day of June, 2009.th

MIRCH LAW OFFICES444 W C Street #320San Diego, CA 92101

BY_/s/ Marie MirchMarie MirchCounsel for Respondent


Documents

6 5 09 in Re Mirch Objection to Report and Recommendations 80074 Doc 31 27 Pages