Battle to seal divisive filing erupts in suit brought by Klein Enterprises, fallout surging past courtroom

By David Yates | Jan 10, 2018

BEAUMONT – A fiery feud that extends far beyond litigants in a lawsuit has turned up the heat at the Jefferson County courthouse, as the presiding judge in the case must now decide on whether to permanently seal a controversial court document.

Last April, Klein Investigations, which is owned by area blogger Philip Klein, filed suit against Kallop Enterprises and several of its subsidiaries, seeking several hundreds of thousands of dollars in damages for services rendered. 

And while Klein’s petition primarily focuses on a breach of contract claim, the litigation has come to focus more on the attorneys trying the case, the presiding judge and even a few individuals who aren’t technically party to the suit.

In July, Klein and his attorney, John Morgan, secured a default judgment against the Kallop defendants worth more than $569,000, court records show.

Judge Sanderson  

Issues of controversy were then raised on whether or not Kallop had been properly served and if Judge Justin Sanderson, 60th District Court, should have recused himself from the case.

Klein’s lawsuit was apparently served by Tom Hanna Jr., the son of Judge Sanderson’s campaign manager in 2016.

Tom Retzlaff, who is neither a plaintiff nor defendant but has made his presence known in the case, says Hanna is not a certified process server.

Klein told the Record that, from his understanding, Hanna is not state certified but has a standing Rule 103 with the courts in Jefferson County.

Retzlaff, Morgan and Klein have been waging courtroom war against each other for the past several years.

Following a hearing for a new trial, Judge Sanderson denied the defendants’ motion, prompting an appeal, which has since been stayed, as Offshore Specialty Fabricators, a Kallop defendant, declared bankruptcy in October.

Retzlaff says Wayne Reaud of Reaud Morgan and Quinn and a county judge were on hand for the hearing.

Because Judge Sanderson did not recuse himself, Retzlaff says he initiated a complaint against him with the Texas State Commission on Judicial Conduct.

The SCJC would not confirm or deny if it had received the complaint, telling the Record they do not give out that information.

Klein began the collection process on the half a million-dollar judgment he won, but the bankruptcy of the defendant soon came into play.  

In late December, Klein and Morgan requested a federal bankruptcy court lift the co-debtor bankruptcy stay, which was denied, court records show.

And now Klein seeks the deposition of the Kallop defendants’ attorney, Jeffrey Dorrell, a move Retzlaff says is aimed at ascertaining his relationship with Dorrell.

On Jan. 2, the Kallop defendants, through Dorrell, filed a response to Klein’s motion to conduct discovery and to a motion for continuance of a motion to dismiss, court records show.

The response contains several exhibits, including a divisive letter authored by Retzlaff to Judge Sanderson.

The letter is laced with expletives and personally attacks Morgan and Klein, going so far as to call them “two lying sacks of (expletive).”

On Jan. 3, the following day, Klein moved to seal the response, arguing that Dorrell unlawfully attached documents in violation of a court order prohibiting Retzlaff from filing anything in the case.

Klein says Retzlaff has been declared a vexatious litigant (meaning he can’t file lawsuits in Texas) and violated state law by piggybacking his letters on Dorrell’s response.

“Dorrell and Retzlaff have again attempted to use the legal system to terrorize the District Clerk’s Office, the court and our firm,” Klein said. “The belief is that Dorrell, by using Retzlaff as his hatchet man, in now six cases around the U.S., is an attempt to harm our firm.

“There are two investigations ongoing currently and it is our hope that this misuse of the legal system stops.”

Retzlaff told the Record that while he is a friend of Dorrell, he is not under the attorney’s employ.

On Jan. 4, a day after Klein moved to have the response sealed, Judge Sanderson held a hearing on the motion and temporarily sealed the document.

Retzlaff says Judge Sanderson illegally sealed the entire response filed by Dorrell without any prior notice to the public, as is required by the Texas Rules of Civil Procedure.

Judge Sanderson did not return multiple requests for comment.

A hearing to permanently seal has been set for Jan. 18.

On his blog, the Southeast Texas Political Review, Klein lists both Dorrell and Retzlaff as stalkers of his.

The Record attempted to reach Hanna through his father at his law office but did not receive a call back.

Cause No. B-199953-A

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