Court Opinion

ID: 4315031
Source: CourtListenerOpinion
Date Created: 2018-09-25 15:08:15.323278+00
Date Added: 2024-06-11T13:27:29.698872
License: Public Domain

FILED
                                                                                Sep 25 2018, 8:37 am

                                                                                    CLERK
                                                                                Indiana Supreme Court
                                                                                   Court of Appeals
                                                                                     and Tax Court

      ATTORNEY FOR APPELLANT                                     ATTORNEYS FOR APPELLEE
      Carrie Castro                                              David C. Jensen
      Law Office of Carrie Castro                                Robert J. Feldt
      Merrillville, Indiana                                      Eichhorn & Eichhorn, LLP
                                                                 Hammond, Indiana

                                                  IN THE
          COURT OF APPEALS OF INDIANA

      Michael D. Goodwin,                                        September 25, 2018
      Appellant-Plaintiff,                                       Court of Appeals Case No.
                                                                 18A-CT-514
              v.                                                 Appeal from the Lake Superior
                                                                 Court
      David L. DeBoer,                                           The Honorable Calvin D.
      Appellee-Defendant.                                        Hawkins, Judge
                                                                 Trial Court Cause No.
                                                                 45D02-1709-CT-88

      Najam, Judge.

                                        Statement of the Case
[1]   Michael D. Goodwin sued his former attorney David L. DeBoer for legal

      malpractice, breach of fiduciary duty, and fraudulent concealment after

      Goodwin pleaded guilty in a federal criminal cause of action in which DeBoer,

      along with two other attorneys, had represented Goodwin. The essence of

      Court of Appeals of Indiana | Opinion 18A-CT-514 | September 25, 2018                         Page 1 of 15
      Goodwin’s civil claims against DeBoer are that, had DeBoer rendered

      competent representation to Goodwin in the federal action, Goodwin would

      not have pleaded guilty. But, after an evidentiary hearing before the federal

      district court in a post-conviction proceeding, the court rejected the factual and

      legal issues that Goodwin now relies on to support his theory that he would not

      have pleaded guilty had DeBoer acted differently. Accordingly, as a matter of

      law Goodwin is precluded from now arguing that DeBoer’s alleged malpractice

      proximately caused Goodwin to plead guilty. As such, we affirm the trial

      court’s entry of summary judgment for DeBoer.

                                  Facts and Procedural History
[2]   In 2011, Goodwin hired Indiana attorneys Clark W. Holesinger and DeBoer

      and Texas attorney William E. Kelly III to represent him in a federal criminal

      action for alleged Medicaid fraud in Texas. In May of 2012, Holesinger and

      DeBoer retained a Medicaid expert, Christine Miller, who authored a draft

      report on Goodwin’s alleged fraud.

[3]   In December, Goodwin entered into a written plea agreement with the United

      States. Pursuant to his plea agreement, Goodwin agreed to plead guilty to one

      count of health care fraud, and, in exchange, the United States dismissed eleven

      other counts. At a hearing on Goodwin’s guilty plea, Goodwin acknowledged

      as true a “factual resume” that established a factual basis for the offense.

      Appellant’s App. Vol. 3 at 126-31, 177. On several occasions, the court asked

      Goodwin if he had reviewed his plea agreement and decision to plead guilty

      with his attorneys. Goodwin repeatedly affirmed that he had done so. With
      Court of Appeals of Indiana | Opinion 18A-CT-514 | September 25, 2018     Page 2 of 15
      respect to the factual resume in particular, Goodwin stated that he had “gone

      over it completely” with his attorneys “[m]any times.” Id. at 177-78. The court

      entered its judgment of conviction against Goodwin and sentenced him to fifty

      months with the Federal Bureau of Prisons.

[4]   Thereafter, in April of 2014 the Porter County Prosecutor alleged that

      Holesinger “stole approximately $380,000.00 from Dr. Michael Goodwin and

      his wife . . . during the time he represented Dr. Goodwin for Medicaid fraud.”

      Appellant’s App. Vol. 12 at 76. Holesinger surrendered his Indiana law license

      and pleaded guilty to several federal and state crimes. However, despite the

      Porter County Prosecutor’s allegation, none of Holesinger’s convictions directly

      related to funds allegedly stolen from Goodwin.

[5]   Shortly after learning of Holesinger’s conduct, Goodwin moved to have the

      district court set aside his guilty plea on the basis that Holesinger had rendered

      ineffective assistance, which motion Goodwin later amended. In relevant part,

      Goodwin’s amended motion argued that Holesinger had advised him to plead

      guilty, and Goodwin had acted on that advice, while Holesinger “was burdened

      by an actual conflict of interest . . . due to his theft of approximately [$380,000]

      from Goodwin during his representation . . . .” Appellant’s App. Vol. 11 at

      135. Goodwin further alleged that Holesinger’s advice was ineffective because

      Holesinger had “concealed the Miller Report” from Goodwin, which Goodwin

      argued was “favorable and necessary for Goodwin’s defense.” Id. at 142-43. In

      other words, Goodwin argued that, had he known of Holesinger’s conduct

      Court of Appeals of Indiana | Opinion 18A-CT-514 | September 25, 2018      Page 3 of 15
      and/or the Miller report, he would not have pleaded guilty. See Appellant’s

      App. Vol. 12 at 122.

[6]   The district court set a hearing date on Goodwin’s amended motion. Ten days

      before that hearing, in June of 2016, DeBoer sent to Goodwin’s wife a draft

      statement for the court on Goodwin’s behalf, which statement Goodwin’s wife

      “immediately” surrendered to Goodwin’s acting counsel. Id. at 96-97. In that

      statement, DeBoer said:

              It seems almost [a] foregone conclusion to me that if Clark
              Holesinger was stealing from Michael Goodwin while
              representing him in the Medicaid case, Goodwin did not have
              the benefit of appropriate[,] competent representation.

              Did Holesinger steal from Goodwin? In my opinion, it is far
              more probable than not that he did.

              I come to that conclusion by recalling my observations of
              Holesinger during the months I helped him with the Goodwin
              case. The nature of the federal Medicaid fraud case meant not
              only did [Goodwin] face criminal penalties for [the] alleged
              violations, he also was at risk to lose all or a large part of his
              substantial net worth. Bank accounts were frozen, real estate was
              attached. During visits to his office, I overheard Holesinger’s
              portion of phone conversations cutting deals with bankers in
              charge of Goodwin’s holdings. There was also a stylish RV that
              was pursued by the government. I believe Holesinger sold this
              for cash . . . before it was seized.

              [Holesinger] appeared more motivated and energized to work on
              the civil/financial aspects of the government’s case than the
              criminal case proper.

      Court of Appeals of Indiana | Opinion 18A-CT-514 | September 25, 2018   Page 4 of 15
      Id.

[7]   Nearly eleven months after the evidentiary hearing, the district court’s

      magistrate judge issued his report and recommendation to deny Goodwin’s

      amended motion to set aside his guilty plea. In relevant part, the magistrate

      judge found as follows:

              In this case, the criminal acts committed by GOODWIN’s
              Indiana counsel, Mr. Holesinger, require the Court to carefully
              and stringently consider this claim and whether counsel’s illegal
              activities affected GOODWIN’s plea and whether such impacted
              GOODWIN’s decision to accept a guilty plea. . . .

                                                       ***

              GOODWIN’s claim that his guilty plea was unintelligent and
              involuntary is conclusory and does not set forth specific factual
              allegations to amount to a constitutional violation. His claims in
              his Amended Motion to Vacate . . . are not supported by reliable
              evidence and these claims contradict the statements GOODWIN
              made in his plea agreement and in open court at his
              rearraignment. . . .

              GOODWIN also claimed Mr. Holesinger told him that he had
              insufficient funds to put forth a defense at trial, and it was this
              information that led GOODWIN to accept a plea of guilty.
              However, GOODWIN was advised of his right to have
              appointed counsel at any time throughout his proceedings if he
              could no longer afford retained counsel or if a conflict arose and
              he could not afford separate counsel. Additionally, the record
              reflects GOODWIN’s decision to plead guilty was a result of the
              plea agreement deadline to dismiss charges against his wife and
              office manager, not because of a lack of funds to proceed to trial.

      Court of Appeals of Indiana | Opinion 18A-CT-514 | September 25, 2018      Page 5 of 15
        In a letter after his sentencing, GOODWIN stated that he
        accepted a guilty plea because he feared the prosecutor would
        proceed with charges against [Mrs. Goodwin] and [the office
        manager] and he wanted to “save them.”

                                                 ***

        The evidence presented at the evidentiary hearing and from
        documents of record in this case indicate that GOODWIN’s
        attorney, Mr. Holesinger, was convicted of Wire Fraud and Theft
        from a pattern of stealing and/or embezzling from his clients.
        This is not disputed by the government and in fact, Mr.
        Holesinger appeared at the evidentiary hearing . . . . However,
        evidence presented at the evidentiary hearing was inadequate to show
        what amount, if any, Mr. Holesinger might have stolen or embezzled
        from GOODWIN. Although GOODWIN testified and presented
        records that he paid Mr. Holesinger approximately $400,000 over
        the course of the representation, GOODWIN has not established
        what amounts of money did not go to legitimate representation
        fees. In fact, it appears GOODWIN is claiming Mr. Holesinger
        embezzled approximately $380,000, meaning that GOODWIN
        believes less than $20,000 was spent on the defense of a
        complicated Medicaid Fraud case spanning over a year and a
        half. The evidentiary hearing record shows Mr. Holesinger
        provided legitimate legal services to GOODWIN. He hired an
        expert, Ms. Miller, hired co-counsel, Mr. DeBoer, hired local
        counsel, William E. Kelly III, and traveled and investigated this
        case, and continued to provide representation from the date he
        was retained in mid-2012 through sentencing in April of 2013.
        Thus, GOODWIN has failed to show Mr. Holesinger actually
        embezzled from him, or, if he did, the amount Mr. Holesinger embezzled.
        GOODWIN certainly has established Mr. Holesinger’s bad acts
        against other clients but at most, he has only shown Mr.
        Holesinger might have stolen from GOODWIN. In any event,
        GOODWIN has failed to meet his burden to show that such behavior
        resulted in deficient performance of counsel and has further failed to prove

Court of Appeals of Indiana | Opinion 18A-CT-514 | September 25, 2018             Page 6 of 15
        how the deficient performance prejudiced GOODWIN’s criminal case.
        Mr. Holesinger’s conduct in defrauding other clients undermines
        confidence in the legal system and calls into question the
        representation provided by Mr. Holesinger to GOODWIN. The
        Court considers Mr. Holesinger’s behavior reprehensible and has
        nothing positive to say about it. However, the burden remains
        on GOODWIN to show both an actual deficient performance
        and resulting prejudice and the Court cannot impute the
        dishonesty of Mr. Holesinger in stealing from other clients to his
        representation of GOODWIN. It is GOODWIN’s task to show
        prejudice by showing specific actions taken or not taken by Mr.
        Holesinger which would have altered the outcome or altered
        GOODWIN’s decision to plead guilty. For example,
        GOODWIN did not show that the alleged embezzlement caused
        Mr. Holesinger to fail to hire an expert and that such failure
        would have changed the course of his case. This high burden
        falls on GOODWIN despite Mr. Holesinger’s clearly egregious
        behavior that GOODWIN became aware of after-the-fact of the
        plea and sentencing and which has undermined GOODWIN’s
        confidence in Mr. Holesinger’s representation. GOODWIN,
        throughout his Motion to Vacate and his evidentiary hearing,
        argued that his attorney, Mr. Holesinger, was convicted of
        wrongdoing in the handling of client funds. GOODWIN then
        leaps to the conclusion that this wrongdoing resulted in per se
        deficient performance in GOODWIN’s representation which
        also resulted in per se prejudice in GOODWIN’s criminal case.
        This automatic leap from proving an attorney’s wrongdoing or
        criminal behavior to proving deficient performance and prejudice
        is misguided. Proving breach of the standard of care owed to a
        client and proving deficient performance are not identical
        processes or findings, nor is proving actual prejudice identical.

                                                 ***

        . . . [D]espite his conclusory claims that he would have “insisted
        on a trial,” he has failed to show such an insistence would have

Court of Appeals of Indiana | Opinion 18A-CT-514 | September 25, 2018        Page 7 of 15
        been rational. He testified at the evidentiary hearing that “he
        wouldn’t continue with someone stealing from me” if he had
        known about the alleged theft/embezzlement during the
        representation. As set out above, however, he never established
        whether or what amount of funds were misappropriated. Mr.
        Holesinger’s conviction documents . . . did not include charges
        that Mr. Holesinger misappropriated funds from GOODWIN
        and to the Court’s knowledge GOODWIN was never named as a
        victim in a criminal case filed against Mr. Holesinger.
        GOODWIN must offer more than he has to establish that he has
        met the prejudice showing required . . . . Furthermore, he has
        failed to meet his burden to show these alleged constitutional
        violations even occurred, because they are contradicted by earlier
        statements made by GOODWIN and no supporting
        documentary evidence or testimony corroborates GOODWIN’s
        change of testimony.

                                                 ***

        GOODWIN gave conflicting testimony and statements regarding
        the Miller report. He acknowledged at one point that he had
        discussed it with [Holesinger] prior to his plea and was told the
        Miller report was not favorable to his case. He later claimed he
        did not know about the report until after his sentencing. . . . [T]o
        the extent that [the Miller report] relates generally to the claim
        that Mr. Holesinger failed to investigate possible defenses,
        GOODWIN has failed to show prejudice by articulating what
        defenses GOODWIN had to the allegations in the superseding
        indictment and how Mr. Holesinger’s alleged deficient
        performance affected the outcome of his guilty plea.
        Furthermore, no argument was made as to what specific information
        was contained in the report that would have been a rational basis for
        GOODWIN to insist upon a trial, rather than pleading guilty. Ms.
        Miller could have been subpoenaed to testify at the evidentiary
        hearing if she had specific information regarding a viable defense
        for GOODWIN’s case.

Court of Appeals of Indiana | Opinion 18A-CT-514 | September 25, 2018       Page 8 of 15
      Id. at 116, 118-23, 129 (emphases added; citations omitted). The district court

      then adopted the magistrate’s findings and entered judgment against Goodwin.

[8]   In February of 2017, Goodwin filed suit against DeBoer in the Lake Superior

      Court. Goodwin’s complaint alleged that DeBoer had committed legal

      malpractice, breach of fiduciary duty, and fraudulent concealment. According

      to his complaint, Goodwin learned of DeBoer’s misconduct from DeBoer’s

      June 2016 statement to the district court in support of Goodwin’s amended

      motion to vacate his guilty plea. In particular, Goodwin alleged that DeBoer

      had breached his duty of care to Goodwin when:

              a.    During visits to Clark Holesinger’s office, [DeBoer]
              “overheard Holesinger’s portions of phone conversations cutting
              deals with bankers in charge of Goodwin’s holdings.”

              b.     [DeBoer] was aware [Goodwin] owned a stylish RV that
              was pursued by the government. [DeBoer] believes “Holesinger
              sold the RV for cash . . . before it was seized.”

              c.    [DeBoer] observed “Clark Holesinger appeared more
              motivated and energized to work on the civil/financial aspects of
              the government’s case than the criminal case proper.”

      Appellant’s App. Vol. 2 at 20. Goodwin further alleged that DeBoer failed to

      “disclose the Medicaid expert’s draft report to [Goodwin],” which report he

      generically alleged “supported a very strong defense.” Id. at 21. Because of

      DeBoer’s alleged misconduct, Goodwin continued, Goodwin “was unable to

      make an informed decision regarding the outcome of his case” and he “would

      Court of Appeals of Indiana | Opinion 18A-CT-514 | September 25, 2018     Page 9 of 15
      not have ple[aded] guilty . . . .” Id. at 19, 24. That is, Goodwin alleged only

      that, but for DeBoer’s alleged malpractice, the outcome of the federal criminal

      action would have been different. In due course, DeBoer moved for summary

      judgment, which the trial court granted. This appeal ensued.

                                      Discussion and Decision
[9]   Goodwin appeals the trial court’s entry of summary judgment for DeBoer. As

      our Supreme Court has stated:

              This Court reviews summary judgment orders de novo. Summary
              judgment is appropriate if the designated evidence shows there is
              no genuine issue as to any fact material to a particular issue or
              claim, and the moving party is entitled to judgment as a matter of
              law. In viewing the matter through the same lens as the trial
              court, we construe all designated evidence and reasonable
              inferences therefrom in favor of the non-moving party. Legal
              questions, such as contract interpretation, are well-suited for
              summary judgment. The party appealing the trial court’s
              summary judgment determination bears the burden of persuading
              us the ruling was erroneous. Nonetheless, we “carefully
              scrutinize[] the trial court’s decision to assure that the party
              against whom summary judgment was entered was not
              improperly prevented from having its day in court.”

      Ryan v. TCI Architects/Engineers/Contractors, Inc., 72 N.E.3d 908, 912-13 (Ind.

      2017) (citations omitted; alteration original to Ryan). Further, “we may affirm

      a grant of summary judgment upon any theory supported by the evidence.”

      Miller v. Danz, 36 N.E.3d 455, 456 (Ind. 2015).

      Court of Appeals of Indiana | Opinion 18A-CT-514 | September 25, 2018   Page 10 of 15
[10]   Although Goodwin’s complaint alleges three claims, the essence of his

       complaint is that DeBoer committed legal malpractice when DeBoer did not

       inform Goodwin of Holesinger’s purported misappropriation of funds and also

       when DeBoer did not share the Miller report with Goodwin. A claim of legal

       malpractice invokes the “trial-within-a-trial” doctrine, under which

               a client alleging legal malpractice must prove not only that the
               lawyer’s conduct fell below the governing duty of care but also
               that the client would have prevailed had the lawyer not been
               negligent . . . .

                                                        ***

               To prevail on [a] legal malpractice claim . . . , [the client] has to
               prove three things: (1) She retained the firm to represent her
               legal interests, so that the firm owes her a duty of care; (2) the
               firm breached its duty of care by failing to exercise the ordinary
               skill and knowledge expected of lawyers; and (3) the firm’s
               breach was the proximate cause of [the client’s] injury. . . .

               . . . [U]nder the [“trial-within-a-trial”] doctrine, the client must
               show the outcome of the botched representation would have been more
               favorable to the client had the lawyer not been negligent. In other words,
               the client must prove the lawyer’s negligence proximately caused her
               injury. . . .

       Roumbos v. Vazanellis, 95 N.E.3d 63, 64-66 (Ind. 2018) (emphasis added). In

       legal malpractice actions, the proximate causation requirement is a “but for”

       requirement. See, e.g., Richard H.W. Maloy, Proximate Cause: The Final Defense

       in Legal Malpractice Cases, 36 U. Mem. L. Rev. 655, 671-77 (2006). That is, the

       Court of Appeals of Indiana | Opinion 18A-CT-514 | September 25, 2018           Page 11 of 15
       client-plaintiff must show that, had the attorney-defendant not acted as he did,

       the result of the underlying lawsuit would have been different. Id.

[11]   In his complaint, Goodwin alleged that, but for DeBoer’s alleged misconduct,

       he would not have pleaded guilty in the federal criminal action. In his motion

       for summary judgment, DeBoer argued that Goodwin in effect seeks to

       relitigate the ineffective assistance of counsel claim he made in the district court

       against Holesinger, which is not permitted. See, e.g., Williams v. Maschmeyer,

       870 N.E.2d 1069, 1070 (Ind. Ct. App. 2007) (“under Indiana precedent, a post-

       conviction finding that counsel was not ineffective provides the necessary

       identity of issues to preclude a malpractice action stemming from the same

       proceedings.”) (brackets and quotation marks omitted). That is, DeBoer argued

       that the district court had already heard and found that Goodwin had failed to

       show that Holesinger had rendered ineffective assistance to Goodwin with

       respect to Holesinger’s misappropriation of funds and also with respect to

       informing Goodwin of the Miller report. DeBoer asserted that Goodwin’s

       complaint here was ultimately about those same issues. The trial court agreed,

       and so do we.

[12]   As we have explained:

               Issue preclusion[, also known as collateral estoppel,] bars the
               subsequent litigation of a fact or issue that was necessarily
               adjudicated in a former lawsuit if the same fact or issue is
               presented in the subsequent lawsuit. If issue preclusion applies,
               the former adjudication is conclusive in the subsequent action,
               even if the actions are based on different claims. The former

       Court of Appeals of Indiana | Opinion 18A-CT-514 | September 25, 2018       Page 12 of 15
                 adjudication is conclusive only as to those issues that were
                 actually litigated and determined therein. Thus, issue preclusion
                 does not extend to matters that were not expressly adjudicated
                 and can be inferred only by argument. In determining whether
                 issue preclusion is applicable, a court must engage in a two-part
                 analysis: (1) whether the party in the prior action had a full and
                 fair opportunity to litigate the issue, and (2) whether it is
                 otherwise unfair to apply issue preclusion given the facts of the
                 particular case. The non-exhaustive factors to be considered by
                 the trial court in deciding whether to apply issue preclusion
                 include: (1) privity, (2) the [party’s] incentive to litigate the prior
                 action, and (3) the ability of the [party] to have joined the prior
                 action.

       Angelopoulos v. Angelopoulos, 2 N.E.3d 688, 696 (Ind. Ct. App. 2013), trans.

       denied.

[13]   The district court’s judgment against Goodwin on his motion to vacate his

       guilty plea conclusively established that Goodwin did not show that

       Holesinger’s misappropriation of funds (against clients other than Goodwin)

       affected his representation of Goodwin or that Goodwin would not have

       pleaded guilty had he known of Holesinger’s misconduct. It further

       conclusively established that Goodwin had failed to carry his burden to show

       that, had he known of the Miller report, he would not have pleaded guilty. The

       district court’s judgment in both respects precludes Goodwin from relitigating

       those issues here. See id.; Williams, 870 N.E.2d at 1070.

[14]   Thus, the designated evidence demonstrates as a matter of law that Goodwin

       cannot show that DeBoer’s alleged misconduct would have resulted in a

       different outcome. DeBoer’s alleged misconduct is simply a failure to inform
       Court of Appeals of Indiana | Opinion 18A-CT-514 | September 25, 2018          Page 13 of 15
       Goodwin of Holesinger’s misconduct and the Miller report, but the district

       court has already expressly found that Goodwin did not adequately show that

       he would not have pleaded guilty had he known of Holesinger’s misconduct or

       the Miller report. See Sullivan v. Am. Cas. Co., 605 N.E.2d 134, 139 (Ind. 1992)

       (holding that “identity of parties” is not required “for the defensive use of

       collateral estoppel”). Goodwin’s claim against DeBoer is derivative of his

       claim against Holesinger. Because his claim against Holesinger has been

       adjudicated, his collateral claim against DeBoer must also fail.

[15]   Nonetheless, Goodwin argues1 that it would be unfair to apply issue preclusion

       against him because the United States Court of Appeals for the Fifth Circuit has

       agreed to review part of the district court’s denial of his motion to vacate his

       guilty plea.2 But the Fifth Circuit’s certificate of appealability is expressly

       limited to the issue of whether Holesinger rendered ineffective assistance when

       he failed to appear at Goodwin’s guilty plea hearing. That issue is not relevant

       to our appeal. We reject Goodwin’s argument that it would be unfair to apply

       issue preclusion on these facts.

[16]   In sum, the designated evidence shows that no genuine issue of material fact

       exists on the question of proximate causation, which underlies each of

       1
         We agree with DeBoer that much of Goodwin’s purported arguments on appeal are “so cursory [as] to
       defy the cogent argument rule.” Appellee’s Br. at 32; see Ind. Appellate Rule 46(A)(8)(a).
       2
         We take judicial notice of the Fifth Circuit’s order. We also note that Goodwin does not argue that the
       Fifth Circuit’s decision to review part of the district court’s judgment renders the remainder of that judgment
       nonfinal.

       Court of Appeals of Indiana | Opinion 18A-CT-514 | September 25, 2018                             Page 14 of 15
       Goodwin’s claims against DeBoer. Thus, DeBoer is entitled to judgment as a

       matter of law, and we affirm the trial court’s entry of summary judgment for

       DeBoer accordingly.

[17]   Affirmed.

       Crone, J., and Pyle, J., concur.

       Court of Appeals of Indiana | Opinion 18A-CT-514 | September 25, 2018   Page 15 of 15