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Co-Defendant's claim against co-conspirator is tossed; Court responds to claim of judicial bias

Utica Steel, Inc., sued John and Marily Amormino and Dorothy LIetke and others, seeking to recapture money that was apparently embezzled.  The defendants resolved their claims with Utica Steel, but Lietke attempted to impose a constructive trust on money he claimed to have turned over to Marilyn Amormino, who apparently worked for him. When the judge criticized his position during settlement discussions, suggesting that he did not have "clean hands" and that his cross-claim lacked merit, Lietke sought to dismiss the judge as biased.  The judge and the Chief Judge both denied the latter motion, and Lietke's cross-claim was ultimately dismissed.

Lietke appealed.  The Court of Appeals rejected his bias claim, pointing to the high standard that must be met to recuse or disqualify a judge. It noted that judges often lean on litigants during settlement discussions in order to facilitate resolution. Telling LIetke's counsel in chambers that:

 "Your client is the bad guy here.  He stole money from the company and utiilized [the Co-Defendant] to do it.  Now he wants to sue her alleging that she stole money from him.  That strikes me as unreasonable,"

did not evidence bias that could not be overcome, or sufficient appearance of bias to disqualify the judge.

The appellate court also upheld the summary disposition of LIetke's claim. The high court judges pointed out that the foundation of his claim was that Amormino owed him a fiduciary duty which he claimed she abused.  Even though the higher court judges concluded that the trial judge was premature in applying the "clean hands" doctrine to dismiss LIetke's claim, they upheld the summary disposition of his cross-claim, on the ground that vesting money with an employee to manage under these circumstances did not create a legally-recognized "fiduciary duty" in the employee. That duty is reserved for situations where the power in the relationship is reversed.

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