Herndon: Carr 'overstating the precariousness'of his finances

Steve Korris Sep. 23, 2010, 1:00am




EAST ST. LOUIS – Rex Carr owes former partners $635,171.23, and U.S. District Judge David Herndon says it's time to pay.

On Sept. 20, Herndon denied a motion to reduce a sanction he imposed on Carr for harassing Stephen Tillery, Steven Katz, and Douglas Sprong with lawsuits.

"Unfortunately for Carr, the bill now has come due for deliberately driving up litigation costs for Tillery, Katz and Sprong as a way to leverage attorney fees," he wrote.

Carr tried to plead poverty, but Herndon wrote that he thinks Carr "is rather overstating the precariousness of his financial condition."

"Carr owes a duty of candor to the court at all times," Herndon wrote.

"Making misrepresentations to the court that are at the very least reckless, if not willful and intentional, is a breach of Carr's professional duties as an attorney and, if persisted in by him, doubtless will lead to the imposition of further sanctions.

"Carr presumably will recover judgments and settlements in the years to come from which the sanction may be satisfied.

"In any event, how and when the sanction is paid is a matter to be worked out among the parties to the case."

Carr, Tillery, Katz and Sprong practiced together at Carr Korein Tillery until 2003, when Carr dissolved the firm.

His former partners dropped his name and called themselves Korein Tillery.

Carr and the others sued each other over fees in 2004, and settled the dispute through a memorandum of understanding.

On March 21, 2007, Carr filed an action for declaratory judgment against Korein Tillery in Madison County Circuit Court.

The same day, in another Madison County action, he sought an accounting and foreclosure of an attorney's lien against the firm and other defendants.

Twelve days later, he claimed breach of contract in St. Clair County Circuit Court.

A week later, he sued Tillery in Madison County.

Sixteen days later, he sued Tillery, Katz and Sprong in federal court, alleging civil violations of racketeering law.

In the next eight days, he voluntarily dismissed all four Madison and St. Clair suits.

His strategy backfired when Herndon ruled that the state suits precluded a federal suit.

Tillery, Katz and Sprong sought payment of their legal bills as sanction, and Herndon denied it.

Tillery, Katz and Sprong appealed, and Seventh Circuit judges in Chicago directed Herndon to award sanctions.

Tillery, Katz and Sprong asked for $1,439,913.71, and Herndon rejected most of it.

Carr moved to alter judgment, claiming the others owed him fees from settlements they reached after he dismissed the Madison and St. Clair suits.

Carr painted himself as a financial wreck and pleaded he couldn't pay.

The motion didn't sway Herndon, who held that Carr could have obtained a declaration of his rights to fees from past and future cases in Madison County.

"Instead Carr chose to split his claims, with the result that he has forfeited his rights under the memorandum of understanding and other agreements," he wrote.

He wrote that Carr multiplied litigation "to burden his opponents and, of necessity, the courts, all in the hopes of extorting attorney's fees from his opponents."

He wrote that Carr has not renounced his tactics, "given his desire to pursue fresh litigation against Tillery, Katz and Sprong."

Finally, he rejected Carr as a hardship case.

Herndon wrote that he didn't rubber stamp the request of Tillery, Katz and Sprong, but instead "surveyed the matter with what the court believes was a suitably fishy eye."

"Whether Carr can afford to pay attorney's fees in even the substantially reduced amount fixed by the court is not the court's concern," Herndon wrote.

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