Utah’s incoming solicitor general, one of the state’s highest-ranking attorneys, is contending with possible court sanctions for allegedly making “patently false” statements during a federal lawsuit over tire safety standards.
Earlier this month, a federal magistrate judge wrote in a scathing order that Melissa Holyoak, who was announced as solicitor general Tuesday, had created slowdowns in the case and wasted judicial resources that were already stretched thin by the pandemic.
“The Court is concerned that Ms. Holyoak may have intentionally attempted to mislead the parties and the Court on a material matter in a case of national importance, which impacts the safety of every man, woman, and child who travels on American roads,” U.S. Magistrate Judge William Matthewman wrote. “If not intentional, her conduct appears to be reckless or negligent.”
A spokesman for Utah Attorney General Sean Reyes called the situation a “misunderstanding” and said Holyoak had disclosed the incident to the office. Her mistake “in no way jeopardized the safety of anyone on the road,” spokesman Richard Piatt said.
In a prepared statement, Holyoak said she made an “honest mistake” interpreting court documents and corrected herself as soon as other attorneys brought the error to her attention.
“While I’m embarrassed that the incorrect argument didn’t adhere to the high standards I hold myself to, I don’t believe sanctions are appropriate because it was not in bad faith and I was not intending to delay the proceedings,” she said.
The magistrate judge admonished Holyoak, who was most recently an attorney with the nonprofit Center for Class Action Fairness (CCAF), over her objections to a settlement agreement in a federal lawsuit. The class action filed in the U.S. District Court for the Southern District of Florida claimed that National Tire and Battery and TBC Corp. improperly sold millions of tires without registering them with the tire manufacturers or providing consumers with forms to complete this registration on their own.
This registration process, mandated by federal law, is crucial so that in the event of a safety recall, the tire manufactures can alert affected drivers, according to the suit. And violating these rules can put customers at risk of missing recall notifications and continuing to drive on faulty tires, the plaintiffs contended.
Ultimately, after mediation, the two sides agreed to a settlement in which National Tire and Battery agreed to change their registration practices, pay $7,500 to the two named plaintiffs and pay $645,000 in attorney fees and costs, court documents show. The defendants did not admit wrongdoing or liability in the agreement and indicated they settled in order to avoid costly litigation.
On Sept. 1, Matthewman granted final approval to the settlement.
However, Holyoak objected to the agreement, identifying herself as an affected consumer who bought tires from a TBC Corp. subsidiary without receiving a registration form. She also explained that she worked for CCAF, whose representatives intervene in cases when they believe attorneys are using “unfair class action procedures to benefit themselves at the expense of the class.”
In this case, she said, attorneys were reaping hundreds of thousands of dollars while the class members — tire customers impacted by the lawsuit — weren’t receiving any money. Moreover, she claimed the settlement agreement merely required “cosmetic business practice changes" that would do no good for class members.
But one of her primary arguments against the settlement, according to Matthewman, was illegitimate, resting on a false assertion that class members were releasing their claims for monetary damages.
“It would have been obvious to Ms. Holyoak — indeed to a first-year law student — that her strenuous objections were inapplicable had she simply taken the time to actually read the Settlement,” the judge wrote.
When attorneys pointed out these misrepresentations, Holyoak withdrew that part of her objection and indicated she’d misread the settlement agreement, according to Matthewman, who accused her of appearing “quite cavalier regarding the serious and misleading nature of her statements and representations.”
The judge said he’s thinking of slapping Holyoak with sanctions, such as making her to pay attorneys fees and costs, and instructed her to send her defense to the court by Sept. 16.
Piatt said attorneys in the case mischaracterized Holyoak’s mistake and that she retracted her erroneous argument as soon as she learned of it. Because the settlement didn’t change the existing tire registration system, the spokesman said, her objection to the settlement and the resulting delay didn’t endanger drivers.
“Melissa and the Center for Class Action Fairness have fought unfair class actions like this one for over 10 years, returning over $200 million to consumers and class members," he said.
But Matthewman argued that proposed changes to tire sales practices are in the best interests of consumers. Going forward, tire buyers will have peace of mind that the sellers are complying with the rules and that manufacturers will be able to reach them with recall information.
“Plaintiffs have achieved a significant change in the Defendants' practice that will protect tens of thousands of drivers and their passengers, and perhaps more than that,” he wrote in the order.
Holyoak attended the University of Utah S.J. Quinney College of Law, graduating in 2003 in the top 10% of her class, according to a news release from the Utah Attorney General’s Office. She’s experienced as a litigator and prosecutor and has most recently worked as president and general counsel of the Hamilton Lincoln Law Institute and its Center for Class Action Fairness in Washington, D.C.
The mission of the Center for Class Action Fairness is to combat “abusive class action settlements,” according to its website.
Attorneys in these class action lawsuits often respond to the group’s objections by painting them as “professional objectors” who will drop their complaints if plaintiffs award them a cut of the attorneys' fees, Holyoak wrote in her objection to the tire settlement. But she said the center has never rescinded an objection in exchange for payment and has fought for better outcomes for class members in these lawsuits.
In a prepared statement, Reyes praised Holyoak for a successful track record in the courtroom and significant litigation, trial and appellate experience.
“I’m confident she will serve the citizens of Utah with dedication and distinction," Reyes said. “Her diverse career experience is just what the state needs as our population continues to grow and more is at stake in every legal case we handle in our office.”
On Tuesday, Reyes announced that Holyoak would immediately be taking over as solicitor general, whose duties include arguing appellate cases in front of the U.S. Supreme Court. Her predecessor, Tyler Green, exited the solicitor general post to work in the private sector, according to a news release.