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Largest Fee Awarded for Bad Faith Litigation

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Yeah, that’s one of those cases that just had a life of its own. The genesis of the case is that the city through the MCDA, the Minneapolis Community Development Agency had acquired a property through a HUD foreclosure and the same day the city acquired the property they flipped it over to a private landowner. As part of that deal the city said we are going, it was a large apartment complex that’s used primarily for low-income people. The city said as part of that deal that they’re going to preserve three driveways that provide the main access to the residential complex and if necessary, they’re going to preserve the driveways through eminent domain.

As it turned out when the city acquired that property from HUD they knew at that time that those driveway easements had been extinguished, didn’t exist but yet they made the promises and now having made those promises they intended to keep them. We represented the adjoining landowner who wanted to develop that property and to develop that property they couldn’t have three driveways running right through the middle of it. So we brought a suit to clean up that title and that was a little bit out of my area at the time I’m not a real estate lawyer but we brought the suit to clean up the title and to have it declared that these easements doesn’t exist anymore and the city just fought that tooth and nail. We originally won on summary judgment that went up to the court of appeals and the court of appeals said there are some fact issues, sent it back.

So we litigated some more, we did some discovery, brought a second summary judgment motion we won that one as well but this time the judge said okay, now you’ve got the declaration that you wanted let’s try the damages case. So we went to trail, we tried the trespass damages case because they’ve been using these driveways without permission for all these years. We won that we got a large verdict and then the city appealed again so we’re back up to the court of appeals.

But what had happened the first time is right during the damages trial we discovered a document that had been written by one of the city’s lawyers many years ago that outlined their strategy for the litigation. And part of the strategy was to basically break this private landowner and litigate as long as possible until the landowner quit so a war of attrition. And when we got that in front of the judge, we moved for sanctions for bad faith litigation. The judge granted our motion, awarded us nearly a half million dollars in attorney’s fees, which at the time was the biggest bad faith sanctions attorney’s fee award ever in the history of Minnesota and to have it come against the city, I mean that was quite remarkable. And that was upheld on appeal.

Minneapolis, MN litigator David Olsen talks about a specific case where he was successful in receiving the largest fee awarded in a bad faith litigation.

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