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Gwire Law Offices successfully represented Carole Matson on a pro bono basis in her fight to recover an excessive attorneys’ fee in a drawn out battle that lasted more than four years, and went through a several day court trial (which we won) and an appeal (which we also won).
Ms. Matson disputed her former attorney Ronald Dean’s egregious claim for fees for helping her obtain disability benefits from her then employer. Ronald Dean is a self-professed expert in the area of employee benefits litigation, is based in the Los Angeles area, and has over 30 years of experience as an attorney. He has specialized in ERISA law for most of his career, and represents clients who are trying to obtain disability and retirement benefits. While he appears to be well-regarded by his peers, both the trial court and the court of appeals viewed his conduct as less than appropriate, professional and ethical.  Both courts wrote opinions citing Mr. Dean’s representation of Ms. Matson as permeated with duress, misrepresentations (both affirmative and by omission), overreaching, and ethical lapses and violations.

Ms. Matson hired Mr. Dean to help her obtain certain disability benefits to which she was entitled through her then-employer, IKON Office Solutions. Ms. Matson suffers from Adenoid Cystic Carcinoma, a rare form of slow-growing terminal cancer which can accelerate at any time. While the cancer was in its early stages, Ms. Matson underwent a total layngectomy, and is able to speak only by using a prosthesis.  Before her disabilities prevented her from working, Ms. Matson was a sales professional managing major accounts at IKON, where she earned a low base salary plus commissions and bonuses. Because she brought in and maintained large clients for IKON, she received substantial commissions and bonuses. She took pride in her work, and would have continued working had she not become severely disabled.

When she first contacted Mr. Dean in November 2002, Ms. Matson had a three month window to complete an appeal for long term disability benefits. She had applied for the benefits on her own and been denied. The evidence revealed that Mr. Dean strung Ms. Matson along on whether he would represent her (and on what type of fee basis) until just four days before her appeal period ran, and then presented her with a fee agreement which he acknowledged was more complicated than a draft he had given her more than a month earlier, and which she openly admitted that she did not understand. (We will add here that when Ms. Matson presented her case to us, two attorneys in our office read Mr. Dean’s fee agreement no less than four times each and still came away not understanding how his fee would be calculated).  Mr. Dean then told Ms. Matson that he could not “represent her” until he had the agreement signed, even though he had already accepted payment from her for services rendered and written to her employer claiming to be her attorney. He claimed he was leaving for a trip and would not return until after her appeal period closed. Ms. Matson had no ability to find other counsel, had no time to raise the money to hire Mr. Dean on an hourly basis and was worried that without representation she would never obtain her disability benefits. She had earned no salary for almost a year. She was desperate and signed an agreement she didn’t understand, was unfair, confusing and gave Mr. Dean a percentage of every payment Ms. Matson would collect for as long as she lived.

We were able to show that having spent months evaluating her case, Mr. Dean knew at the time his contingency fee agreement was signed that the risk of losing the case was minimal, and the amount of work involved not substantial. Indeed, the bulk of Ms. Matson’s disability benefits were granted with nothing more than a single letter that Mr. Dean sent off the day after the fee agreement was signed. Within three weeks, the disability insurance carrier granted full retroactive and prospective long term disability benefits. A little over six weeks later, on April 23, 2003, IKON’s new disability carrier affirmed the award of disability benefits without requiring any further documentation of disability.

The only remaining issue was how IKON had calculated Ms. Matson’s compensation (important because the amount of the benefit was related to the amount she earned). Long before he filed the appeal letter which resulted in the granting of benefits, Mr. Dean was aware of the dispute over the basis for disability calculations.  Mr. Dean also became aware that there may be a class action lawsuit in the works, and asked Mr. Matson if she would act as a class representative, which she agreed to do because she didn’t want others to be taken advantage of either.  Mr. Dean proceeded with the class action lawsuit using Ms. Matson as the class representative but not bothering to have her sign a new fee agreement. At no time prior to filing the class action did Mr. Dean ever explain how the recovery or an award of attorneys fees might affect Ms. Matson’s obligations for Mr. Dean’s fees other than a vague agreement to give her some sort of a discount in fees if he won the class action lawsuit.

The class action lawsuit eventually settled before a class was ever certified, and with Mr. Dean putting in about 50 hours of work over about two years. In the end, Mr. Dean collected an attorneys fee award of approximately $35,000 for the class action, 25% of the back disability benefits paid to Ms. Matson, and began to collect 25% of Ms. Matson’s disability benefits (including the increased benefits) as his fee.  He intended to continue to collect these fees for as long as Carole Matson received them.

After having paid Mr. Dean for about six years, Ms. Matson questioned the legality of the fee agreement in her own layperson’s way – she asked Mr. Dean to “allow [her] to end the retainer contract, eliminating [her] need to pay [Mr. Dean] any further,” because she felt that she had more than compensated him for the small amount of work he had done for her. Mr. Dean declined. She eventually stopped paying Mr. Dean his portion of the monthly a few months later. Mr. Dean then persuaded the disability insurance company to pay him 25% of Ms. Matson’s disability benefits directly, and for four or five months, Mr. Dean received 25% of Ms. Matson’s disability check directly from MetLife. The balance went to Ms. Matson.

That’s when Ms. Matson turned to Gwire Law Offices for help. We offered to settle the case with Mr. Dean very early on by allowing him to retain all the payments he had received thus far, if he would just allow Ms. Matson to keep her entire payments going forward.  He refused and the litigation battle began.

Despite Mr. Dean’s aggressive litigation tactics, which included a motion for summary judgment (that Gwire Law Offices defeated), Ms. Matson eventually prevailed at trial. When Mr. Dean appealed, Ms. Matson prevailed on appeal as well. Mr. Dean’s fee agreement was found to be unconscionable and Mr. Dean had to disgorge almost all of the fees he had collected from her over six years with interest.  Ms. Matson was awarded all of the disputed funds that were escrowed during the four year litigation; and Ms. Matson was excused from having to pay him any further fees. She was finally and fully vindicated. Mr. Dean’s litigation tactics pre-trial, the trial and the appeal forced to us to spend the equivalent of approximately $240,000 in fees in representing Ms. Matson, who to this day, represents not only one of our most satisfying success stories, but one of our favorite clients.