341: Nashville lawyers go to US Supreme Court, while Memphis lawyers settle the most talked about Tennessee lawsuit

From the Supreme Court to Nashville... I’m on a plane from Washington, DC, with about 7 Nashville lawyers riding with me, after yesterday’s United States Supreme Court oral arguments that featured Nashville bankruptcy lawyers on both sides.

Here’s how SCOTUS Blog framed the issue: whether a bankruptcy court’s denial of a creditor’s motion seeking relief from the automatic stay is a “final” order that is immediately appealable.

This was a pretty obscure procedural issue, and I pity those poor student groups who sat through the animated back-and-forth about what a “proceeding” is in Bankruptcy Court.

It was a great day for the Nashville bankruptcy bar, and the lawyers on both sides really shined. It was also my first trip to the Big Courthouse, and I’m planning a longer post about the experience for early next week.

Save Bluff City Law! I was forwarded the attached e-mail petition, created by a Memphis lawyer, trying to rally support for NBC’s legal drama Bluff City Law.

I’m impressed by the grass-roots activism from the Memphis bar, and I have to admit, the show makes the practice of law in Memphis look very exciting and scenic. I’m signing the petition.

Bluff City Law, Indeed. Talking about national attention focused on the Memphis bar, it looks like there’s a potential resolution in the James Wiseman v. NCAA and the University of Memphis lawsuit filed in Shelby County Chancery Court.

Here’s my blog post about it from the weekend.

The Daily Memphian interviewed me for their story, What comes next in James Wiseman’s eligibility saga?, about the various legal issues and strategies presented (which, I’ve been told, ESPN’s Jay Bilas quoted in an on air interview!)

No deed goes unpunished, and this involved me diving deep into federal court jurisdictional issues, whether a “nominal defendant” destroys complete diversity, and looking up the exact nuances of Injunctive relief procedure.

Trust me, this was the first time this 26 year old reporter ever cited Wright on Federal Procedure.

Regardless, I love the Daily Memphian, and it got me this close to appearing on the Geoff Calkins radio show as a legal expert. I was scheduled to appear on Monday, but a producer bumped my appearance.

It was with great shame that I notified my Memphis friends and family that I was bumped to make room for listener call-ins.

Speaking of great shame… I was alerted that the following blurb and text auto-posted over the weekend. To be clear, the words below this blurb are a quote from the advice column, not how I feel (at least not all the time).

The opening line? “I’m a litigation attorney and am absolutely miserable.”

The James Wiseman saga mixes my two favorite things: Memphis basketball and Chancery Court procedure

The James Wiseman news ruined my Friday evening. It doesn’t get more ominous than this:

First, I’m a Memphis fan. This includes the University of Memphis, the basketball team, the football team, the people of Memphis, and the city itself.

(Side Note: As a Memphian For Life, how awesome was it to see my Memphis people representing on twitter last night? Don’t mess with Memphis.)

Second, I’m a commercial litigator, and, here I was, thinking through issues of complex legal procedure, exactly 45 minutes before I was planning to watch James Wiseman play basketball.

But, then, some exciting news:

So, the Shelby County Chancery Court granted a Verified Complaint filed by James Wiseman, represented by Lesline Ballin, that requested a Temporary Restraining Order.

Story over, right? Not at all.

Legal analysis to follow:

Tennessee Rule of Civil Procedure 65 controls here. Tennessee Rule of Civil Procedure 65.03 provides, in part, that a court “may issue a temporary restraining order without written or oral notice to the adverse party or its attorney” when “an affidavit or verified complaint clearly show that immediate and irreparable injury, loss, or damage will result to the applicant before the adverse party can be heard in opposition [.]”

Here, this TRO was entered without notice to the NCAA. The NCAA didn’t have an opportunity to respond with factual or legal analysis…or even a one page “We Object!” filing.

The Shelby County Chancery Court simply reviewed the filed pleadings to make sure that the Verified Complaint, if assumed to be true, connected all the dots to satisfy the elements for getting a TRO issued. In a way, it’s just a matter of being good at paperwork at this stage.

And it helps if you probably have the Judge’s cell phone number.

Don’t get me wrong; it’s still savvy lawyering. Courts refer to any relief under Rule 65 as “extraordinary relief.” It’s a big deal, and a strong move by Memphis and Ballin.

But there is a long road ahead, with the first test coming up soon.

TROs only last 15 days. Under Rule 65.03(3), TROs have a limited life; they only last 15 days, unless they are extended by the Court. That’s the reason for the low proof threshold; TROs are designed to be temporary remedies.

The real fight will be over the Temporary Injunction. Under Rule 65.04, the court will replace the TRO with a Temporary Injunction, which is designed to provide longer injunctive relief to the plaintiff while the litigation proceeds.

Under Rule 65.04, a “temporary injunction may be granted during the pendency of an action if it is clearly shown by verified complaint, affidavit or other evidence that the movant’s rights are being or will be violated by an adverse party and the movant will suffer immediate and irreparable injury, loss or damage pending a final judgment in the action, or that the acts or omissions of the adverse party will tend to render such final judgment ineffectual. “

In deciding whether to grant the temporary injunction, the court will apply a “four-factor test: (1) the threat of irreparable harm to plaintiff if the injunction is not granted; (2) the balance between this harm and the injury that granting the injunction would inflict on the defendant; (3) the probability that plaintiff will succeed on the merits; and (4) the public interest.”

Here, James Wiseman’s case will rise and fall on item # 3, and the NCAA will want a mini-trial on the violation. Wiseman should have a fairly good argument on items 1 and 2, since he’ll lose valuable chunks of his college career if he has to sit out.

If I had to bet, I’d think a judge would let him play, while the matter is being litigated.

But, what Court will decide? There’s no way this matter stays in Shelby County Chancery Court.

Despite what Bluff City Law says (i.e. where every case they handle is in the Shelby County Courthouse), this case will be removed to federal court.

Pursuant to 28 U.S.C. § 1441, a case “may be removed by the defendant or the defendants, to the district court of the United States for the district and division embracing the place where such action is pending.” Here, the District Court for the Western District Courts of Tennessee will likely get this case, unless the NCAA both removes the matter to district court and then asks for a change of venue (to a different district court in the US) at the same time.

Given the time challenges here, I’d bet the matter would stay in Memphis’ district courts.

There are a number of reasons a defendant would remove this. For one, a state court judge is popularly elected, and, while judges are generally not biased, an elected judge would face great public pressure from a rabid fan base. District Court judges are lifetime appointees by the President, and they are perceived to be free from bias.

How to Get Rich in Distressed Assets in Nashville? (You probably won’t like my answer)

In a strong economy like Nashville-2019, I get lots of calls from people looking for “good deals” on real estate.

First, I tell them to buy a time machine that will take them back to 2010.

Then, I commiserate with them about all the awesome deals that I watched other people pounce on over the last 7 years (with, of course, a quick reminder about all the awful deals that brought people to financial ruin in the 7 years before that).

After all that, I get serious and talk to them about buying distressed real estate, and all the forms and forums where that can happen. Bankruptcy Sales. Foreclosures. Sheriff’s Sales. Tax Sales.

It’s, literally, a path full of misery and heartbreak, but it’s probably the only realm in present-day Nashville where you can truly get a good deal.

And part of the reason that there’s so much upside is that there’s so much risk in these types of sales. There’s no way to avoid that risk, and, at best, your goal is to simply mitigate that risk.

TL;DR: You have to know what you’re doing. Otherwise, you’re buying your dream house for pennies on the dollar, only to learn that you’re not getting what you thought you were.

I recently taught a CLE for OutkickCLE on distressed buying, and I’ll post that video link here when it goes live. In the meantime, I’ll be posting snippets from my CLE materials here. Stay tuned.

New Court of Appeals Opinion revisits ineffective service of process issues in Tennessee

In March, I discussed the rapidly developing litigation in Tennessee debtor-creditor law about the failure of many process servers to comply with Tenn. Code Ann. § 16-15-901(b). In order to have valid service of process, this statute says: “The process server must be identified by name and address on the return.”

Note: Here’s my post from 2015, when I warned you all that these issues were going to be a problem.

In an opinion issued yesterday, the Tennessee Court of Appeals upheld this analysis, in one of the few times the appellate courts have considered this issue.

The case is Cornerstone Financial Credit Union v. Joshua Mundy, M2018-01624-COA-R3-CV (Tenn. App. Oct. 23, 2019).

It’s a well done opinion, with a good review of personal jurisdiction, ineffective service of process, void judgments, and the method for raising these issues under Tenn. R. Civ. P. 60.02(3).

I’m biased, because–as you may note–I represented the appellee/debtor in the Mundy case. But, nevertheless, Judge Dinkins’ opinion is a good reminder that every lawsuit must start with proper service–or everything else after that may fall apart.

New Tennessee Law Allows Judgments from Foreign Countries to be Enforced in State

A few years ago, I asked the question “How ‘Foreign’ can a foreign judgment be and still be entitled to domestication?

In that post, I considered whether a a truly foreign judgment, i.e. one entered by a different country, could be domesticated and enforced in a state court, whether under state law (i.e. the Uniform Enforcement of Foreign Judgment Act) or under federal law. In the end, I thought it would, citing the Uniform Foreign Money-Judgments Recognition Act, a federal statute that can be found at 13 U.L.A. 261.

To my surprise, I just discovered that the Tennessee Legislature passed a brand new set of statutes on this issue, effective on July 1, 2019.

Found at Tenn. Code Ann § 26-6-201, et. seq., these statutes are titled the “Uniform Foreign Money-Judgments Recognition Act.” Per Tenn. Code Ann § 26-6-202 and -203, this Act expressly applies to judgment issued in a court of a foreign country that “[g]rants or denies recovery of a sum of money” and is “final, conclusive, and enforceable.” Interestingly, the Act doesn’t apply to a foreign judgment for taxes or fines/penalties.

Nothing beats actually reading the statutes, so I’ll just recap some highlights.

Be sure to read Tenn. Code Ann. § 26-6-204, which recites the various standards for recognition. Most importantly, check out subpart (b), which provides examples of matters in which a Tennessee court “may not” recognize the foreign judgment (where the court lacks “impartial tribunals or procedures”; no personal jurisdiction; no subject matter jurisdiction). Also, see subpart (c), which provides the examples for when a Tennessee “need not” recognize the foreign judgment (insufficient notice; fraud; repugnant policy; inconvenient forum; conflicting venue provisions).

Tenn. Code Ann. § 26-6-205(a) provides some examples of where a Tennessee court can pretty easily find personal jurisdiction (i.e. the defendant was actually served in that country; made a voluntary appearance in the proceeding; a car accident in that country).

Pursuant to Tenn. Code Ann. § 26-6-204(c), “[a] party resisting recognition of a foreign-country judgment has the burden of establishing that a ground for nonrecognition stated in subsection (b) or (c) exists.”

Some quick thoughts:

  • With all the legislative fights in Tennessee over this past summer, I’m surprised that there was no mention of this new Act;
  • This is a fairly obscure issue, and I’m honestly impressed that Tennessee has such a fair process for recognition of foreign judgments;
  • I think the statutory text of the Act has some language that will be difficult to navigate, including the “may not recognize” and “need not recognize” phrases in Tenn. Code Ann. § 26-6-204 (b) and (c).
  • If a party digs in on the “need not” criteria, including whether a cause of action is “repugnant to the public policy of this state,” we’re going to be having some really interesting arguments in Davidson County Chancery Court.

In short, I’m glad that Tennessee has adopted a version of the Act and that we have clarity as to whether a judgment from a foreign country will be enforceable and domesticated in Tennessee.

For years, I’ve handled a number of these, generally shoe-horning these judgments into the existing Tennessee Foreign Judgments Act.

Listen to the Judges

One of the benefits of practicing law for nearly two decades is that, by this time, I know the judges. I’ve either appeared in front of them dozens of times or, just as likely, I know them personally after spending years dealing with them when they were just regular lawyers.

Now, this isn’t to suggest that, even with 20 years of experience, you don’t have to give the judge respect, just because you’re so familiar with them. It means that you come to realize that judges are people too, and they’re subject to the same frustrations, flaws, and distractions that all lawyers are.

In the past two weeks, I’ve spent time with 3 different judges in social settings, and here’s some wisdom that I’ve picked up.

Stop it with the discovery disputes. They hate them, and two of the judges said “I wanted to tell them to be adults and just figure it out.” That’s easier said than done, especially when it’s the other side who is being the jerk. I guess the take-away is, unless it’s really bad, try really hard to get it resolved and, if you do have to court, make it clear how hard you tried to get it resolved.

Get to the point. Another frustration is that the parties want to push all their facts and legal citations toward the bench, and essentially ask the judge to figure it out. And, yes, that’s the judge’s job. But, if you can make it as clear and easy as possible, you should.

And, a big part of that is presenting clear, straight-forward briefs, without any extraneous legalese.

I really like this article, “How to Write So Judges Will Like You.” “Life on the other side of the gavel is busy, filled with hearings and trials and conferences and five hundred lawyers who all think their motion is an emergency that deserves immediate and undivided attention….get to the point quickly.” 

The next time you’re writing a big brief, before you start, take a moment and read that article. We practice law in a time when heretofors, comes nows, and by and through undersigned counsels just aren’t expected by modern judicial readers. It’s a waste of space and time, when a judge needs you to get to the point, say what’s really going on, and why you’re right.

Stop it with the fidgeting and listen. One judge shared a story about presiding in a small courtroom, about 7 feet away from plaintiff’s counsel before trial. And, as the judge was discussing preliminary pre-trial issues, counsel just couldn’t stop arranging everything. Pens. Post-its. Folders. Files. The judge couldn’t even focus, because it looked like counsel wasn’t listening. And that was irritating.

Now, as all trial lawyers know, that’s a nervous time. You’re rehearsing your opening statement, terrified that you’ve misplaced your exhibits, and worrying about 50 things at once.

That’s a fairly extreme example, but here’s one I see a lot: Lawyers simply can’t stay off their phones, even during their own court proceedings. Sure, sometimes there are emergency e-mails, but, generally, it’s mindless checking of twitter or texts.

I remember, as a young lawyer, some of the older lawyers would set up shop on the back row and open up the newspaper and read it while waiting for their case. Can you imagine that? That’s somebody who isn’t paying any attention–I mean, people used to do that at football games as a show of disrespect to the other team.

Staring at your phone is the modern equivalent. It makes you look unengaged and bored by what’s going on.

So, again, all of this is hearsay, gleaned from conversation here and there. But, keep this in mind the next time you’ve got something coming up in court. These may have been words from your Judge.

341: My Review of Bluff City Law: How is Memphis a real place that exists?

I was born and raised in Memphis, and it remains my favorite city in the world. It’s a city full of weird, interesting, and incredibly genuine people.

After going to law school in Knoxville for 3 years and living in Nashville for the past 20 years, I’ve heard all the criticisms that the rest of Tennessee has about Memphis. But, what they don’t realize is that Memphis doesn’t care about what the rest of the state thinks. Memphis sees itself as its own state, identifying more with western Arkansas and northern Mississippi.

All those “let’s give Memphis to Mississippi and Arkansas” jokes? Sounds good to most Memphis people.

So, it’s no surprise that I share Memphis’ civic pride about Bluff City Law, a legal drama set in (and actually filmed in) Memphis. If you follow the live tweets, you’ll see all types of Memphians recognizing the filming locations, spotting locals as extras, and deliberating the authenticity when Jimmie Smits declares “I grew up in South Memphis!” as he beats a guy up. (Note: The consensus is that this is fine.)

The Commercial Appeal does a regular episode recap, which can be found here. One of my favorite writers, Chris Herrington, does a recap for the Daily Memphian, and here’s his Episode 2 recap.

I’ll save you a full recap, but I thought it was a bit “on the nose” to have one of the legal subplots involve a inter-family dispute over a generations old barbecue sauce recipe. I mean, c’mon, a lawsuit over barbecue in Memphis?

But, my skepticism was won over later in the episode, when the (now) demolished ruins of the Wm. C. Ellis & Sons Ironworks and Machine Shop ended up being a critical plot piece.

This is unintentionally timely, since–just last week–the Tennessee Court of Appeals issued an opinion related to ongoing legal issues arising from the 2017 sale of that historic Memphis site, which is being developed into a Live/Work/Play area called One Beale. (Obviously, the TV show did not delve into the probate and guardianship issues that the Court of Appeals did. I consider that a smart plot decision.)

But, regardless, I enjoyed seeing the show incorporate the actual streets of Memphis into their plot lines.

Other items of note from the episode:

  • I appreciated that the lawyers took such good care to protect their ties while eating the messy ribs. One tucked his tie into his dress shirt (the northerner); the other flipped it over his shoulder (the Memphian). Personally, I avoid eating ribs altogether when wearing a tie, but I feel like flipping the tie over your shoulder is a more “Memphis” move. It’s less pretentious.
  • Given the high rates of Bankruptcy filings in Memphis, I think the lawyers trying to stop the farm foreclosure would have just gone to 200 Jefferson Street (i.e. the United States Bankruptcy Court for the Western District) and filed a Chapter 12 (which occurs fairly frequently in that district), rather than commandeering a golf cart at Chickasaw Country Club and tracking down a judge to sign an emergency TRO.
  • To be clear, to all my non-lawyer friends, that is not how quickly and efficiently and hap-haphazardly the wheels of justice move.
  • Also, why are all the lawyers in the show graduates of Vanderbilt Law School?
  • When the opposing party got so mad at Jimmy Smits, I loved that he threatened to report him to the Tennessee Bar Association. It’s strange to hear somebody talk about the TBA on NBC in primetime.
  • I remain surprised that the lawyers keep getting happy hour drinks on Beale Street, notably Rum Boogie Cafe. What, was Mud Island not open? With all the awesome dive bars in Memphis, there has got to be a better setting for these scenes. Are you really telling me that Alex’s Tavern, the P&H Cafe, or Ernestine & Hazels’ aren’t available for filming?

That’s really my biggest complaint about the show: Memphis might possibly be the most authentic place on Earth, but the show is treating the stories like they are set in [Insert City Name Here]. There’s so much grit and grind and weird and crazy and bizarre in the city of Memphis, and I would think these plots and subplots would write themselves.

I mean, one of the perennial candidates for Mayor of Memphis (Prince Mongo), claims that he’s an alien from outer space (Zambodia, to be exact). The most famous nightspot is a downtown disco, run by a cape wearing DJ with a checkered past who preached no discrimination in between Prince songs, sirens, and blasts from a smoke machine (RIP Raiford).

There’s just so much extra in Memphis, and I hope the writers and show runners get to a comfortable place where they can explore those facets of the city that can really differentiate this TV show from the regular, been-there-done-that legal drama.

Just last week, I saw a great tweet during the Memphis Tigers and Navy football game, when the ESPN cameras caught some Memphis fans, wearing an incredibly authentic Memphis t-shirt, enjoying the Memphis victory and maybe a little bit too much. In response:

How is Memphis a real place that exists? Whenever I take friends out and show them my favorite places in Memphis, and they interact with the great people who live there, that’s what I hear from them. In a good way.

So, Bluff City Law, I hope you find whatever that is. Have Jimmy Smits go to Gus’ World Famous Fried Chicken. Have Sydney meet with a criminal informant at Printer’s Alley. Have Della (the probate lawyer) represent one of the Ellis heirs in the guardianship dispute.