$1.5-Million Fine Levied in Frivolous Lawsuit : Courts: Plaintiff and counsel are ordered to pay because they pursued case even though they had no proof of their claims.

In one of the biggest fines ever imposed for pursuing a frivolous lawsuit, a Los Angeles judge has ordered a well-regarded law firm, two of its lawyers and its client to pay $1.5 million to a Buena Park roofing insulation installer and three other defendants in an unsuccessful product-liability suit.

Superior Court Judge Ronald E. Swearinger found that Sierracin Corp. and its attorneys, the law firm of Lewis, D’Amato, Brisbois & Bisgaard in Los Angeles, had filed a suit that was frivolous and in bad faith because they knew they had no proof to connect the defendants to allegedly defective aluminum foil insulation.

The suit was thrown out in January and the sanctions levied Thursday. Swearinger has not yet signed the order imposing the fine but said Monday he expects to do so this week.

“There was no basis for this lawsuit at all,” the judge said. “It should have been dropped a long time ago.”

The sanctions were ordered to cover the legal fees and costs of four groups of defendants sued over a 1985 fire that destroyed a Sierracin manufacturing plant on South Broadway in South Los Angeles.

Swearinger’s order also covers Lewis D’Amato lawyers Gordon J. Calhoun and Lee W. Harwell Jr. Calhoun has represented other plaintiffs with complaints about aluminum foil insulation. Neither he nor the law firm’s managing partner could be reached for comment Monday.

Lewis D’Amato has said it will appeal both the dismissal of the suit and the sanctions, according to the Los Angeles Daily Journal, a trade publication for the legal profession. Officials at the State Bar of California said only one other fine for $1.5 million has been assessed in recent memory and that ruling was reversed on appeal a year ago.

Sierracin alleged that the aluminum foil insulation used in the roofing of its plant was defective, causing a small fire to spread quickly and gut the building. But after seven days of testimony, it could not prove that any of the defendants produced, sold or installed the material.

The biggest chunk of last week’s sanctions--$580,830--will go to the Dittemore Co., now known as Dittemore Bros. Inc., and its two principals. Dittemore is a roofing insulation installer in Buena Park.

Roy and Sons, a wholesaler of aluminum foil insulation, is to receive $543,322. Aluminum Co. of America, a manufacturer, is to get $362,163; and Louis Hafers, another wholesaler, $4,941.

Since the 1950s, aluminum foil insulation has been marketed as cheaper than fiberglass yet just as effective in keeping heat out during the summer and in during the winter, said William Chapman of Irvine, Dittemore’s lawyer.

The insulation, used in commercial and industrial buildings, is made of two thin sheets of aluminum with kraft paper between them to give strength when the insulation is nailed to rafters.

But a rash of fires in the 1970s sparked an investigation by a Costa Mesa fire marshal. He issued a report in 1981 blaming aluminum foil insulation for spreading minor fires and causing major damage. The report resulted in a slew of lawsuits.

“The argument by the insurance companies who pay off the fire damage is that the heat from the fire turns the kraft paper to a gas,” Chapman said. “The gas that is formed explodes and burns like gasoline as it falls from the rafters.”

But the lawyer said few cases have gone to trial. Insurers for defendants, concerned about the possibility of huge awards, typically settle and then refuse to provide coverage any more or provide it at exorbitant prices, he said.

The Dittemores and others in the industry, he said, only recently found insurance companies that will fight these types of cases.

Chapman said his law firm, Chapman, Fuller & Bollard, has handled 20 such cases so far and is ready to go to trial on one of them. He asserts that a recent re-evaluation of the Costa Mesa fire marshal’s 1981 report, as well as a deposition by the fire marshal, Russell Henderson, shows that the report was faulty. Henderson has since left the department and is living in Washington, Chapman said.

Sanctions for attorney misconduct are usually difficult to win and rarely amount to more than a few thousand dollars. Appellate courts from time to time have urged lower courts to use sanctions more, even though they sometimes overrule them.