Lawyer Sam Spital to Pay $1.8 Million to Settle Suit : Advertising: Action alleged that Spital’s firm, which advertises heavily on TV, falsely claimed client was insane after botching an injury lawsuit.

Samuel E. Spital, a San Diego personal injury attorney widely known for his extensive use of television advertising, has agreed to pay $1.8 million to settle a malpractice lawsuit alleging that his firm botched a product liability lawsuit and then claimed that the client was insane in the hope of covering the mistake.

The settlement, which also involves two other lawyers, was announced last week by Harvey R. Levine, the attorney who represented Jyl Lenett in the action against Spital.

Seeking an unspecified amount of damages, Lenett sued Spital in August, 1991, alleging that Spital had improperly represented her in a lawsuit against Bic Pen Corp., the manufacturer of a lighter that allegedly caused severe eye damage.

Levine stressed the settlement’s “impact on truth in advertising,” and noted that he took Lenett’s case because the woman relied on Spital’s advertising when she sought his legal assistance.

“The theory (behind the lawsuit) was fraud and misrepresentation in the advertisements” that drew Lenett into Spital’s office, Levine said.

“I think it is one of the few cases where the advertising lawyer is in a civil court because of advertisements instead of a regulatory agency,” Levine said, downplaying the amount of the award.

Although the $1.8-million settlement far outweighs the approximately $25,000 he estimates his client would have received from Bic, Levine said he would like to see the publicity surrounding the settlement result in attorneys getting together and making advertisements that would inform the public on how to properly obtain legal services.

Spital’s ads, which urge viewers to “let Sam do it,” typically feature what appear to be satisfied clients, but in one case the client is really a wheelchair-bound man who is a friend of Spital’s wife, according to Spital’s deposition in the case.

“His advertisements also imply that he will personally be involved in and oversee the handling of each individual case,” according to the lawsuit. The television advertisements usually note that he is a former deputy attorney general who “knows the law” and is “tough” on defendants responsible for injuries.

“These kinds of ads really don’t add to the public’s perception,” Levine said.

Spital did not return several phone calls made to his office, and a spokesman at the firm refused to comment on any aspect of the settlement or the lawsuit.

One of Spital’s attorneys, Lindsay Brack, also did not return several phone calls made to his office. A second attorney in the case was out of town.

Also named in the lawsuit were attorneys Karl Bloomfield, who initially handled Lenett’s lawsuit, and Walter E. Pinkerton Jr. Spital’s office would not say if either man is still with the firm, but the most recent edition of the local attorney directory lists both men as still working there.

Citing a confidentiality clause in the settlement agreement, the attorney representing Bloomfield and Pinkerton refused to comment on the matter.

“I really haven’t heard anything other than there has been media inquiry into the settlement,” said David W. Clingman, who refused even to confirm if his clients were part of the settlement agreement.

The lawsuit, which is scheduled to be formally dismissed at the end of this month, charges the attorneys with legal malpractice, negligent misrepresentation, intentional infliction of emotional distress, and libel and slander.

Levine said the lawsuit and a deposition that Spital gave for the case in August are “an eye-opener.”

During the deposition, Spital admitted that he has only tried one civil lawsuit before a jury--and that was with another attorney--and that he has never tried a product liability suit.

Documents accompanying the Spital deposition also indicate that attorneys in the firm were encouraged to settle cases.

For example, a May, 1989, memo written by the managing director of the firm, Earle Cross Jr., states that “because of the serious cash-flow issues, it is extremely important that each attorney begin settling cases.”

The lawsuit also calls into question one of the key claims that Spital makes in many of his ads.

“Spital’s advertisement is false, deceptive and misleads the public because, as a deputy attorney general, he did not do work which involved personal injury litigation or trials, but merely participated in Board of Medical Quality Assurance administrative hearings,” according to the complaint.

The lawsuit filed by Lenett outlines the case against Spital from the time of her accident on Feb. 1, 1989, when she received a severe eye injury when a Bic disposable lighter allegedly “shot out a flame several feet.”

Within one week, she contacted Spital, who assured her that “he would personally oversee and control the case,” although another attorney actually worked on the case, according to the lawsuit.

Throughout the year, Spital told Lenett that the case was progressing according to plan, even though Bloomfield allegedly failed to return Lenett’s phone calls on a regular basis during the last few months of 1989, the complaint said.

Although she inquired about the statute of limitations, the lawsuit against Bic was filed one day late, on Feb. 2, 1990. The statute of limitations requires that personal injury lawsuits must be filed within one year of the injury being sustained. There are only very limited reasons why this time limit can be extended.

Furthermore, court records show that Bloomfield not only failed to inform Bic of the legal action, he failed to meet a court-ordered deadline after a judge ordered him to pay a $100 fine.

Bic had the case moved to federal court, and in March, 1991, asked that the case be dismissed because Lenett failed to file the lawsuit within the one-year time limit. “There was virtually no defense to this motion,” Lenett’s complaint states.

In opposition to the motion, Spital’s firm asked the court to determine, among other things, that a year was 366 days long and that 1989 was a leap year.

Pinkerton, who had taken over the case from Bloomfield, also asked the court to extend the statute of limitations because Lenett was insane when the accident with her lighter occurred.

Lenett says she was informed about the insanity defense only one week before the documents were filed in court.

After Pinkerton asked Lenett to obtain an affidavit from her doctor which attested to her mental incompetence, “she unequivocally told him that she was not mentally incapacitated or in any way insane on the day of the incident, and she did not want that allegation made about her in writing or in open court,” the complaint reads.

However, at the July 8, 1991, hearing on the motion for dismissal before U.S. District Court Judge Judith N. Keep, “he falsely represented to the federal court that Ms. Lenett had seen a doctor who would support the allegation that she was incompetent,” according to the lawsuit.