Court of Appeal rejects attorney's lien claim in Scientology case

Metropolitan News-Enterprise, Los Angeles/December 8, 2006
By Kenneth Ofgang

The Court of Appeal for this district has rejected an attorney's claim to a portion of the millions of dollars recovered by a former Scientologist in the decades-long suit over what he said were coercive tactics by the church.

Div. Two Wednesday affirmed Los Angeles Superior Court Judge Robert L. Hess' ruling invalidating Leta Schlosser's attorney fee lien against Lawrence D. Wollersheim's $8.7 million recovery from the Church of Scientology and its affiliated organizations.

Wollersheim, who filed suit in 1980, won a $30 million jury verdict against the church, which appealed, eventually winning a remand from the U.S. Supreme Court and a reduction of the award to $2.5 million. The amount, which grew to $8,674,843 with costs and interest, was finally paid into court by the defendants in 2002.

Schlosser, who joined Wollersheim's legal team in 1990 or 1991, was paid $100,000 and sought to recover an additional amount by filing a cross-complaint to the church's action interpleading the funds. That litigation has gone forward, while all other claims against the recovery have been resolved.

Schlosser did not specify a total amount, but an attorney for Wollersheim told the METNEWS last year that she had pegged the amount at between $600,000 and $1.2 million at a deposition.

Schlosser claimed that Wollersheim agreed in writing to pay her $150 per hour in connection with the litigation in the U.S. Supreme Court, and orally agreed to pay a $150,000 bonus upon collection of the judgment.

Hess granted Wollersheim's motion for the release to him of the remaining funds. He ruled that Schlosser did not have a valid lien because she did not advise Wollersheim of his right to independent legal advice.

The Court of Appeal stayed Hess' order.

Justice Judith Ashmann-Gerst, in an unpublished opinion Wednesday for the panel, said that Schlosser lacks an enforceable lien because she did not comply with Rule 3-300 of the Rules of Professional Conduct, which prohibits an attorney from obtaining an interest adverse to a client unless the terms are fair and reasonable and fully disclosed to the client, the client has been advised in writing of the right to seek independent legal advice and given an opportunity to do so, and the client thereafter consents to the terms in writing.

While Wollersheim had other lawyers representing him and might have received independent advice concerning Schlosser's lien, Schlosser "did not acquire a lien in the appropriate manner, and rule 3-300...requires strict adherence." The justice also rejected Schlosser's claim that she is entitled, even in the absence of a lien, to have a portion of the funds held to satisfy her claim in quantum meruit.

The case is Schlosser v. Wollersheim, B186313.