The plaintiff, Junior Larry Hillbroom, assisted by his lawyer Graham B. Lippsmith, is asking for a jury trial.
Hillbroom filed the complaint against lawyers David J. Lujan and Barry J. Israel, Keith A. Waibel and 10 other individuals for legal malpractice, breach of fiduciary duty, fraud, civil conspiracy, violations of California business and professions code.
Hillbroom is asking the U.S. District Court Central District of California to grant him judgment and relief and pay him special damages in an amount to be proven at trial, forfeiture of any and all attorney’s fees collected by the attorneys, restitution, disgorgement of ill-gotten gains, attorney’s fees, punitive damages, treble damages, prejudgment interest, costs of this action and any other relief that the court deems just and proper.
Hillbroom, now a resident of Idaho, was the sole beneficiary of JLH Trust, a financial trust registered in the Cook Islands and operated in Morro Bay, California.
Lujan and Israel were the plaintiff’s lawyers while Waibel was the trustee of JLH Trust.
The plaintiff filed one count of legal malpractice against Lujan and Israel for breaching their fiduciary duties by charging or collecting unreasonable fees or amounts for expenses and acquiring a proprietary interest for their representation beyond the contingency fee provided in the 1998 retainer.
The plaintiff filed one count of negligence against Waibel for failing to exercise reasonable care and skill in performing his duties as trustee to the JLH Trust, including allowing Lujan and Israel to increase their contingency fee from 38 percent to 58 percent after settling the Hillblom Estate Case and paying the unsubstantiated costs from the JLH Trust.
The plaintiff also filed one count for breach of fiduciary duty against all defendants for “conspiring with each other to increase the amount of contingency fees charged after the first settlement in the Hillblom Estate case was reached.
He said the plaintiffs increased their attorney’s fees from 38 percent to 56 percent and made decisions to pay unsubstantiated amounts.
He also accused them of “racketeering activity” in violation of 18 United States Code of 1961.
The plaintiff said he was informed about the defendants’ racketeering activity through acts of attempting to commit mail fraud and wire fraud on numerous occasions.
He said the two lawyers repeatedly sent interstate telephone calls, faxes, e-mails and letters to Waibel to his place of business and residence in California to increase their contingency fee.
He said he believes the lawyers used money wire transfers both into and out of the JLH Trust.
All the defendants are accused of civil conspiracy with each other to increase their attorney’s fees, misappropriate the plaintiff’s money and assets received from the Hillblom Estate case settlement, and derive other profits through racketeering activity and other fraud.
Finally, the plaintiff is accusing the defendants of violations of California Business and Professions Code by failing to keep him informed about increasing the attorney’s fees and making him pay for unsubstantiated costs.
The plaintiff said the defendants’ conduct was “malicious, fraudulent, oppressive, and intended to injure the plaintiff.”
In May 1995, Larry L. Hillblom, co-founder and owner of DHL Worldwide Express, died in an airplane crash, leaving behind several children and an estate worth approximately $550 million.
Lippsmith said the plaintiff, one of Hillblom’s heirs who lived in Palau with his mother, learned that Hillblom was his father in 1995 and he was entitled to a large portion of Hillblom’s estate.
Lujan and Israel represented the plaintiff in his claims to be designated as son and heir to the estate that Hillblom left behind.
The lawyers also represented the plaintiff in other related legal matters including establishing the JHL Trust and appointed Waibel as trustee, establishing and changing guardianship of the plaintiff and monetizing the plaintiff’s assets from the Hillblom estate case.
Lippsmith said the lawyers kept the plaintiff in the dark about the estate proceedings.
Lippsmith said the plaintiff’s grandmother Naoko Imeong served as the plaintiff’s guardian but from 1999 and onwards, Waibel was appointed as the plaintiff’s guardian.
Lippsmith said the plaintiff who was a minor did not participate in any of the 1998 retainer negotiations.
In early 1999, the parties in the Hillblom Estate case entered into a global settlement providing that 60 percent of the Hillblom estate would go to the four qualified heir claimants, one of whom was the plaintiff.
Lippsmith said upon participating in the negotiations and finalizing the settlements, the defendants conspired to increase the contingency fee and retain Waibel as trustee as long as he continue in assisting the two lawyers in concealing their self-dealing from the plaintiff.
Lippsmith said the lawyers took total control of the plaintiff and his grandmother, moving them from place to place.
By the end of 2001, the plaintiff was already 17 years old but he did not know how much he got from the global settlement of the Hillblom Estate case until an agent from the Federal Bureau of Investigation met him on Nov. 10, 2006.
Lippsmith said the plaintiff discovered that his ultimate recovery after the attorneys deducted their inappropriate fees and unsubstantiated costs from his more than $50 million settlement of the Hillblom Estate case was approximately $12 million.
