DISTRICT FEE ARBITRATION COMMITTEE DOCKET NO. IX-01-041F

    PAUL J. ROVELLI, Client, v.
    MILTON DIAMOND, Attorney.

    STATEMENT OF REASONS



    The client, Paul J. Rovelli, was referred to the attorney, Milton Diamond, by another attorney who was representing Mr. Rovelli in an employment dispute with his employer, a prestigious university in the New York metropolitan area. The referral was unrelated to the employment dispute. Rather, the matter referred to Mr. Diamond arose out of Mr. Rovelli's experiences in preparing and submitting four manuscripts to a publisher located in St. Paul, Minnesota. This publisher rejected Mr. Rovelli's manuscripts within two weeks after they were received. Mr. Rovelli then requested that the publisher return his manuscripts. Mr. Rovelli received his manuscripts from the publisher in late September, 1999.

    When Mr. Rovelli opened the package containing his manuscripts, he also found a copy of an e-mail message dated August 28, 1999 from a Jim Garrison to a Nancy Mostad and a Brad Burroughs. All three of these individuals worked for the publisher. This e-mail print contained another e-mail print from a James Wasserman to Jim Garrison. James Wasserman was a high official in an organization known as Ordo Templi Orientis, Inc. (OTO), which is based in California. Mr. Rovelli was once a member of this organization, but had left the organization prior to the happening of these events.

    Mr. Wasserman's e-mail to Mr. Garrison stated:

      "Subject: Re: Paul J. Rovelli

      Dear Brother Jim, 93 ... I thought the name Paul Rovelli rang a bell. He is most definately (sic) not currently associated with the O.T.O. He was though at one time. He took his IIIrd in 1990 in NYC, but he stopped paying dues and we marked him inactive in 1993 e.v. [paragraph omitted] I'm sure he would be hard pressed to prove good report enough to reaffiliate (sic). There was some nastyness (sic) surrounding a divorce or estrangement ... he was arrested and then started writing inflanunatory and racist material. I don't know where it was published but Bill Hiedrick [sic] got hold of it and it was determined that it was a very good thing this man was no longer an active member. [paragraph omitted] That's all I know at this point. If he says he represents the O.T.O. in any capacity it is untrue and something we need to know about. As far as material he may be writing ... what can I say? The stuff might be great or
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      not, but he has a history of going off the deep end with the printed word. 93 93/93"

    Mr. Garrison's e-mail to Nancy Mostad and Brad Burroughs, dated August 28, 1999, states:

      "Well, below is a response from a very well-placed and reliable source within the OTO. After seeing what you showed me Thursday, coupled with this response from the OTO; I'd definitely ask that we reject these 4 manuscripts from Mr. Rovelli. If you need an Eval done, I can do so fairly quickly either Monday or Tuesday. He's a real risk, and we have nothing to gain from his axe-grinding and agendas, nor from his plagiarism of Crowley, cranky comments about potentially litigious authors, and generally poor (read: antiquated) writing style."


    Mr. Rovelli deemed these e-mail statements to be highly libelous and so injurious to his reputation that he would be foreclosed in the future from getting anymore of his manuscripts published. He first met with Mr. Diamond on or about November 2, 1999 in the basement of Mr. Diamond's home and explained the situation to Mr. Diamond. Mr. Diamond told him that his case was very strong and that he had won this type of case before. He told him about a case of this type which he had completed for a Mason, in which he had obtained substantial money damages for his client, and he implied to Mr. Rovelli that he might obtain substantial money for damages as well. Mr. Diamond further told Mr. Rovelli that he normally would charge a flat fee of $30,000 for this type of case, but after Mr. Rovelli told him he could not pay more than $20,000, Mr. Diamond told him that he would charge him only $20,000, which he termed a "discounted rate." Mr. Diamond did not ask Mr. Rovelli to pay court costs or out-of-pocket expenses, nor did he ask him for any contingent fee. Mr. Diamond did not supply Mr. Rovelli with anything in writing concerning his fees.

    Mr. Diamond advised Mr. Rovelli that he would first file suit in a "lower" court before filing in a "national" court. He explained that the suit might be rejected in the lower court, but if it was, then he would file in the national court. Mr. Diamond explained that he would rather not travel to Newark if he could avoid it. Mr. Diamond did not discuss with Mr. Rovelli what the fee situation would be if there were an appeal. Mr. Diamond also did not advise Mr. Rovelli that New Jersey has a one year statute of limitations for filing a suit for libel or slander. [N.J.S.A. 2A:14-3] Although nothing was placed in writing, Mr. Diamond gained Mr. Rovelli's confidence and, on or about November 7, 1999, Mr. Rovelli gave Mr. Diamond a check for $10,000.00 which Mr. Diamond negotiated to his account.

    Mr. Diamond prepared a verified complaint and demand for jury trial dated November 24, 1999, which was docketed on December 1, 1999 in the Superior Court of New Jersey, Law Division, Middlesex County as L-113227-99. Essentially, this complaint alleges that Mr. Rovelli is, by profession, a writer and author in the field of spirituality, metaphysics, religion and the occult arts, that he has privately published in the metropolitan area volumes of works, such as "The Whole Tarot Workbook", "Thelemic Sutras", "Thelemic Qabalah" and "Thelemic Commentaries" and that the defendants (who were the publisher in St. Paul, Minnesota, the California organization, Ordo Templi Orientis, Inc. and the individuals, Jim Garrison, Brad Burroughs, Nancy Mostad, Bill Hiedrick [sic], and James Wasserman) had defamed him and that he had been compelled to spend a large sum of money

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    to defeat the charges against him and to vindicate his reputation, etc. The complaint also alleged invasion of privacy and intentional infliction of emotional harm.

    Subsequently, Mr. Rovelli learned that, on a website named "The Star Goddess", two publications concerning him had appeared, one dated November 16, 1999 and one dated December 3, 1999. Mr. Rovelli stated that "The Star Goddess" website is the website of a John Sorrentino, and that John Sorrentino was the publisher of these statements. These website statements were written under the pretense that Mr. Rovelli was the author and portrayed Mr. Rovelli in very disparaging terms, including a "rapist" and a "druggie." Mr. Rovelli brought these publications to the attention of Mr. Diamond, who then prepared and filed an amended complaint adding John Sorrentino as a defendant in the lawsuit. The amended complaint is dated January 6, 2000 and was filed with the Superior Court in Middlesex County sometime in January, 2000. By her letter dated February 2, 2000, Mr. Diamond's assistant, Patricia Cashin, sent the amended complaint to the Essex County Sheriff's Department for service of process upon Mr. Sorrentino in Bloomfield, New Jersey.

    Subsequently to preparation of the amended complaint, Mr. Rovelli tried to contact Mr. Diamond several times, but was unsuccessful. Mr. Diamond's assistant, Ms. Cashin, was taking Mr. Rovelli's messages, but Mr. Rovelli did not receive any return telephone calls. After several weeks went by. Ms. Cashin told Mr. Rovelli that Mr. Diamond had suffered a heart attack. Mr. Diamond then called Mr. Rovelli and advised him that he was not practising law anymore and that this case was being transferred to another attorney, who Mr. Diamond named. Mr. Diamond stated to Mr. Rovelli that he would remain available to answer the new attorney's questions, but that he would stay in the background.

    Mr. Rovelli had intended to pay Mr. Diamond another $10,000.00 in early 2000, but because the case was transferred to a new attorney, Mr. Rovelli paid the second 10,000 to the new attorney. Mr. Rovelli stated that he, the new attorney and Mr. Diamond subsequently had three conference calls regarding his case. The new attorney served interrogatories on two of the defendants, which the defendants answered. The defendants, Ordo Templi Orientis, Inc., Bill Heidrick, James Wasserman and Jim Garrison, then moved to dismiss the complaint for lack of personal jurisdiction. Evidently, Mr. Diamond knew that this might be a possibility, because he had told Mr. Rovelli at the outset that the case migh tbe rejected in the "lower" court. The basis for his motion was that these individual defendants had never been present in the State of New Jersey and that the corporate defendant, Ordo Templi Orientis, Inc. had not been present in the State of New Jersey in any way for at least one year prior to the happening of any of the events upon which the complaint was based.

    The trial judge granted the motion to dismiss for lack of personal jurisdiction, advising the attorneys not to even bother to come to court for oral argument. The exact date of the trial judge's order of dismissal was not provided at the hearing, but it probably occurred in October of 2000. In any event, it was after the one year statute of limitations had run on the e-mail statements of August, 1999, which Mr. Rovelli had learned about in September of 1999. Mr. Rovelli was, by then, foreclosed from filing a complaint in federal court based upon diversity jurisdiction because the one year statute of limitations had runa gainst all defendants except Mr. Sorrentino, the only defendant

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    located in New Yersey. Mr. Rovelli then settled his complaint with Mr. Sorrentino for $750.00

    Mr. Rovelli's second attorney advised Mr. Rovelli to contact Mr. Diamond and ask him to explain his fee of $10,000. Mr. Rovelli contacted Mr. Diamond regarding this matter, and Mr. Diamond invited him to lunch. Mr. Rovelli accepted this invitation. Mr. Rovelli's purpose in doing so was to ask Mr. Diamond for his $10,000 back. At lunch, Mr. Diamond showed Mr. Rovelli a statement listing services he had performed for Mr. Rovelli and valuing those services at $300 per hour. Mr. Rovelli did not have a copy of this statement at the hearing, but he remembered that the statement contained the three conference calls in which Mr. Diamond had participated with Mr. Rovelli and his new attorney and that the sum of all charges at $300 per hour was in excess of $10,000. Mr. Diamond also told Mr. Rovelli what a wonderful human being Mr. Rovelli was. In this manner, Mr. Diamond made Mr. Rovelli aware that he had no intention of returning any portion of the $10,000 Mr. Rovelli had paid to him. Mr. Diamond picked up the tab for lunch.

    Mr. Rovelli feels that Mr. Diamond has wronged him and that Mr. Diamond should refund to him not only the $10,000 he paid to Mr. Diamond, but also the $10,000 that Mr. Rovelli paid to the attorney who took the case from Mr. Diamond after Mr. Rovelli was informed that Mr. Diamond had suffered a heart attack. The committee does not have jurisdiction in this fee arbitration to compel Mr. Diamond to pay back the $10,000 that Mr. Rovelli paid to the new attorney on his case. Mr. Diamond must pay back to Mr. Rovelli the entire $10,0000 that he received from Mr. Rovelli, however, because Mr. Diamond has failed to meet his burden of proof that he is entitled to any fee, let alone a reasonable fee, even though he met with Mr. Rovelli, prepared a complaint, prepared an amended complaint and participated in three conference calls.

    Mr. Diamond was aware that Mr. Rovelli probably had a viable cause of action in defamation. Unfortunately, he placed Mr. Rovelli's cause of action at undue risk by failing to consider the New Jersey one year statute of limiations when he took a chance on whether the Superior Court of New Jersey would have personal jurisdiction over the defendants. In fact, because of the risks associated with the personal jurisdiction problems in New Jersey, Mr. Diamond schould never have taken the case to a New Jersey court. He should have advised Mr. Rovelli to take his case to California where the primary corporate defendant was located, or to federal court in that area, so that he could be sure he would not have any significant jurisdiction problems. Had Mr. Rovelli been so advbised, and had he acted upon that advice, the outcome of Mr. Rovelli's case might very well have been quite different from how it ended up in New Jersey. Although Mr. Diamond did some legal work for Mr. Rovelli, that legal work was of no value to Mr. Rovelli because it was not reasonably calculated to preserve and protect Mr. Rovelli's legal rights. Furthermore, even if Mr. Diamond were entitled to a legal fee for the services he did perform, he clearly engaged in overreaching. His meeting with Mr. Rovelli, his filing of a complaint and an amended complaint, and his participation in three conference calls with the attorney to whom he referred the case could hardly justify a flat fee of $10,000 for his services. Mr. Diamond's failure to state his fees in writing and his failure to bill his client or to account in any meaningful way for the $10,000 his client paid to him, by themselves, violate the Rules of Professional Conduct, but the gravity of these omissions pales in comparison to Mr. Diamond's failure to consider the effect of the New Jersey one year

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    statute of limitations for libel and slander on Mr. Rovelli's cause of action when choosing the forum in which to initiate this lawsuit.

    Panelists: Jane M. Langseth, Esq.
    Paul E. Zeager, Esq.
    Ellen Barrie

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    Documents:
    1. Rovelli's statement
    2. The document that started the complaint
    3. The slander continued
    4. The complaint (three pages of eleven): page 8, page 9, page 10, dated January 6, 2000



    An objective researcher will benefit from these Court conclusions

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