New York Attorney Malpractice Blog

Hinshaw reports a fairly complicated commercial liquidated damages case arising from a bank loan to individuals which led to a default, which led to a confession of judgment, which led to a settlement, with inadequate documentation of the settlement.  At least one judgment was not marked "satisfied."  After trips up and down to the Appellate Courts there, and after changes in the law of liquidated damages, it all boiled down to a question of when the bank became aware of its attorney's mistake.

"In September 2005, Wachovia initiated a legal malpractice action in Leigh County against Ferretti, asserting claims of professional negligence and breach of contract. In February 2006, Ferretti filed an answer, asserting, inter alia, that Wachovia’s claims accrued no later than October 1994—that is, when Pisani commenced his action against Meridian—and were thus time-barred by the statute of limitations. The trial court found in favor of Ferretti and dismissed the complaint with prejudice. More specifically, the trial court found that the negligence cause of action, which carried a two-year statute of limitations, accrued in June 2003. The trial court likewise found that the breach of contract cause of action had accrued in October 1994. Thus, the statute of limitations for both claims had run prior to filing of the complaint.

Wachovia appealed, arguing that it had not in fact experienced an actual loss by that time and that a suit against Ferretti before that time would have been premature. The Pennsylvania appellate court disagreed and affirmed the dismissal. "

Clients claim that attorney forged their names on settlement documents, then stole money.  They sue attorney, get judgment, and then lost any ability to collect, when carrier successfully disclaims and wins a collection case brought by the cleints against the carrier. Wiley Rein, LLP reports:

The Supreme Court of Nebraska has held that misappropriation and dishonesty exclusions in a lawyers professional liability policy barred an attorney's former clients from executing legal malpractice judgments against the insurer that issued the policy. Fokken v. Steichen, 2008 WL 62539 (Neb. Jan. 4, 2008).

Several of the attorney's former clients accused him of settling their tort claims without their approval by signing their signatures on release agreements and settlement checks without their authorization. The former clients also asserted that they had not received any of the settlement proceeds from the attorney. Furthermore, the former clients alleged that the attorney (1) failed to communicate with them regarding the defendants' settlement offers; (2) accepted the settlement offers on their behalf without obtaining their consent; (3) allowed their tort claims to be dismissed with prejudice after the statute of limitations had expired; and (4) breached fiduciary duties owed to them. The former clients won malpractice judgments against the attorney and then instituted garnishment proceedings against the attorney's insurer, and the parties cross-moved for summary judgment.

In granting the insurer's motion for summary judgment, the court first observed that the former clients' garnishment claims against the policy proceeds depended on whether the insurer would have been obligated to indemnify the attorney for the malpractice judgments in the first place because "the claim of a judgment creditor garnishor against a garnishee can rise no higher than the claim of the garnishor's judgment debtor against the garnishee." The court next considered the former clients' argument that "where an insurance company is notified of a pending suit against an insured and has a full opportunity to defend the action, the judgment against the insured, if obtained without fraud or collusion, will be conclusive against the insurance company." The court rejected this contention, explaining that the insurer was not challenging the malpractice judgments but was instead contending that the judgments were not covered by the policy. "

One of the more ironic but interesting aspects of legal malpractice, like quantum mechanics, is that the very act of measurement [trial] can cause the observed object to change.  Similarly, in the prosecution of a legal malpractice case, there can be legal malpractice .  Here, from the Madison Record there is the potential for a further case:

"Madison County Circuit Judge Daniel Stack had to consider calling a mistrial Tuesday in a professional negligence case against the law firm Thompson Coburn.

Representing Magna Bank (now Regions), plaintiff's attorney Rex Carr -- whose trial skills are legendary -- informed Stack that he had been giving daily transcripts to some of his witnesses.

Carr told Stack that he has supplied trial transcripts to his experts, including his star, and protege, Belleville attorney Tom Keefe.

He said the only other time he had to deal with daily trial transcripts was during the historic three-and-a-half year-long dioxin trial he pursued in St. Clair County.

Potential witnesses were allowed to review the transcripts in that case, he said, due to the sheer volume of evidence presented during the record setting civil trial against Monsanto.

After Carr's surprise announcement that he let witnesses see that transcripts, Carrie Hogan of Jones Day in Chicago wanted Stack to call a mistrial.

Stack, who came in to work on a state holiday for judges (Lincoln's birthday), called a recess and advised Carr and Hogan to discuss the possibility of a settlement, but those talks stalled after about an hour of discussions.

Afterwards, Carr said he would exclude any witness that saw the transcripts. "

A commonly quoted statistic is that 95% of all cases are resolved prior to trial;  they are resolved through motions to dismiss, motions for summary judgment and settlements.  The few cases that go on to trial generally, they calculate, go 50/50.  Here is a highly reported, big $ legal malpractice case which went to trial, and ended in a verdict for defendant.  Law.Com reports:

"A Philadelphia jury Wednesday cleared Duane Morris of a claim of legal malpractice for its representation of a former client in settlement negotiations, according to attorneys in the case.

The eight-member jury found the firm did not breach the standard of care or breach any fiduciary duty when its client signed a settlement agreement that provided no security, the attorneys said.

The case was held before Philadelphia Common Pleas Judge Howland W. Abramson in the Commerce Court Program.

The eight-member jury began deliberating at about 3 p.m. on Tuesday for 3 1/2 hours and came back to deliberate at 1 p.m. Wednesday, handing down a verdict at 3 p.m. The jury was selected on Feb. 4, and closing arguments were held on Tuesday. "

Legal malpractice is a wholly state cause of action, and might be brought in Federal District Court only if there is a basis for jurisdiction.  Diversity jurisdiction is the one most quickly thought of, but in certain circumstances federal question jurisdiction may also apply.  Questions of legal malpractice in a patent representation is one such example.  Here, the case of  Immunocept v. Fulbright & Jaworsky provides a discussion of why it may [and on removal, must] be brought in Federal District Court.  There they say:

"Because the claim scope determination involved in the malpractice claim presents a substantial question of patent law, we conclude that jurisdiction is proper under section 1338."

In Scher v. Mishkit  [NYLJ exerpt], Supreme Court, Suffolk County refused to allow this attorney to wifhdraw pursuant to CPLR 321.  This situation is more common than one might guess, especially in medical malpractice cases.  The case is brought, and prosecuted, with depositions, and medical record exchanges, and then placed on the calendar, without an expert in place. 

Not unexpectedly, time goes by, and the case starts to be near the top of the list for jury selection, and defendants have not offered to settle.  Plaintiff's attorney still has no expert, and it starts to look like they may simply have worked this case up on the assumption [hope] that defendants would settle...and now they have a problem.

That's what this case seems to be about. "PLAINTIFF'S lawyer moved to withdraw as the attorney of record asserting that the attorney-client relationship was at an "impasse." Counsel argued it was unable to find an expert willing to testify for plaintiff at trial in this medical malpractice action. Plaintiff opposed the motion, alleging she cooperated with counsel and through all the years of representation received "constant assurance that this was a valid case."

Result?  Attorney must stay in case.

It is an ethical  violation of 22 NYCRR 603.4[e][1][iv]  willfully to fail to satisfy a judgment arising out of one's professional activities.  For the most part, these judgments arise from legal malpractice. Here  an attorney is suspended because of an unsatisfied judgment:

"Respondent's failure to cooperate with the Committee's investigation (22 NYCRR 603.4[e][1][i]) and her willful failure to pay money owed to a former client, which debt is demonstrated by a judgment (22 NYCRR 603.4[e][1][iv]), warrant her immediate suspension (see In re Zimmerman, 45 AD3d 212 [2007]; Matter of McClain-Sewer, 39 AD3d 35 [2007]; In re Singer, 301 AD2d 336 [2002]; In re Adelman, 263 AD2d 160 [1999]). Accordingly, the Committee's motion should be granted and respondent suspended from the practice of law, effective immediately, until the proceedings pending before the Committee are concluded and until further order of this Court. "

So far the central question in this legal malpractice case is whether it is taking place in a judicial hellhole, and incidently, who gets to make that decision.

This is a legal malpractice case taking place in Madison County, Illinois.  Here is the story from the Madison St. Claire Record:

"Relics of Madison County's past are scheduled to reappear for a legal malpractice trial that will open old, painful wounds and be as dramatic as anything ever seen in an Edwardsville courtroom.

The heart of the matter is about the area's most notorious swindler James Gibson who stole millions from children and widows by making off with their structured settlement funds.

But legendary plaintiff's attorney Rex Carr -- who plans to call former Madison County judges Gordon Maag and Randall Bono and prolific personal injury attorney Thomas Q. Keefe as witnesses -- is trying to convince the jury to take pity on another victim in the "debacle," his client, Magna Bank (now Regions Bank).

Indiana Legal Blog reports on the Transcontinental legal malpractice case.  We reported on it earlier, but there seems to be a new twist:

"On appeal, the Indiana Court of Appeals did not accept the excess insurer’s argument that they should be allowed to bring a legal malpractice claim against the client’s attorneys under the doctrine of equitable subrogation. The Indiana Court of Appeals found no material issue of fact in finding that limited correspondence between the excess insurer and the client’s attorneys fell significantly short of constituting an attorney/client relationship. Id. at 724. Furthermore, the Indiana Court of Appeals held that allowing the legal malpractice suit under the doctrine of equitable subrogation would essentially be the same as allowing an assignment of the cause of action from one party to another, which it will not do. Id. at 723. In support of the holding, the Indiana Court of Appeals explained it will not allow legal malpractice actions in these situations for the reason that allowing them would divide the loyalty of the attorneys. If allowed, attorneys will be tempted in not vigorously representing their clients in order to protect themselves against third parties such as the excess insurer in this case. Id.

The Indiana Supreme Court granted a petition to transfer and the Indiana Court of Appeals opinion has been vacated. "

Here is a commentary from Larry Upshaw  on the pro/con arguments for a law firm putting an arbitration clause in the retainer agreement.  From plaintiff's prospective, it can be a costly problem.  Take a commercial legal malpractice in which there are potential $ 1 million damages.

A trial can be had for the cost of an index number.  The arbitrator's fees can be as high as $ 50,000.

From the blog: "It’s curious that many lawyers routinely put arbitration clauses in their engagement letters with clients. Here you have quite literally the foot soldiers in the third branch of government, charged by our professional oath to be officers of the court. And yet, in contracts with clients, these attorneys opt out of the court system by obligating clients to take any dispute to arbitration.

The subtext of that conduct seems clear: these lawyers don’t trust the court system to treat them fairly and prefer the private dispute resolution process of arbitration to court. Call me crazy, but that certainly sounds out of whack. It’s kind of like a doctor saying, “If I get sick, whatever you do, do not take me to a hospital.”

While it may seem ironic that lawyers are running for protection to arbitration clauses, there is an even bigger ironic surprise waiting for these lawyers who opt out of the court system. Keep in mind that the arbitration clause in your engagement letter obligates your client to pursue his or her malpractice claim against you in arbitration instead of in court. And it therefore obligates your insurance carrier to have its liability for your malpractice determined in arbitration instead of in court. It turns out that insurance companies actually like jury trials and are not always all that fond of arbitration. Lawyers who force their clients into arbitration and then get an arbitration case for malpractice are now routinely receiving a “Reservation of Rights” letter from their insurance carrier, threatening to deny insurance coverage because the lawyer deprived the insurance company of its right to a jury trial.

Next time you are tempted to show your distrust for the court system by including an arbitration clause in your fee contracts, keep in mind that you may have just cancelled your malpractice insurance policy. "

Here is a case from Richmond County with an interesting twist.  Facts:  Mother gets into money trouble and faces foreclosure.  Daughter helps out and negotiates a mortgage to pay off the earlier debts and prevent foreclosure.  An attorney is "assigned" by the mortage company for the mother.  Later Mom comes to believe that the terms and fees of the mortgage have been misrepresented.  She stops paying and this action endues.

After being sued, she third-parties the attorney.  Now he, as a third-party defendant moves to dismiss.

"In support of his motion to dismiss the third-party complaint pursuant to CPLR 3211(a)(1), attorney Bellini maintains that the factual allegations in the third-party complaint preclude the maintenance of a cause of action against him for breach of fiduciary duty. In this regard, Bellini purports to rely upon the allegations that: (1) it was the daughter, Elizabeth Giammarino, who was acting as the third-party plaintiff's attorney-in-fact; (2) the third-party plaintiff did not attend the closing; and (3) attorney Bellini never spoke to the third-party plaintiff prior thereto. On the basis of this "documentary evidence," Bellini contends that any cause of action against him for breach of fiduciary duty could only run in favor of Mrs. Giammarino's daughter, Elizabeth.

CPLR 3211(a)(1) provides that a party may move for the dismissal of one or more causes of action asserted against it on the ground of a defense founded upon documentary evidence. To succeed on such a motion, however, the documentary evidence that forms the basis of the defense must be such that it resolves all of the factual issues as a matter of law, and conclusively disposes of plaintiff's claim (see, Scadura v. Robillard, 256 AD2d 567 [2nd Dept. 1998]). Thus, a motion to dismiss the complaint pursuant to CPLR 3211(a)(1) may be granted only where the documentary evidence utterly refutes plaintiff's factual allegations, thereby conclusively establishing a defense to the action as a matter of law (see, Ruby Falls, Inc. v. Ruby Falls Partners, LLC., 39 AD3d 619 [2nd Dept. 2007]). Here, the third-party defendant has not met this burden.

The allegation that the daughter was acting under a power of attorney as her mother's attorney-in-fact does not conclusively establish the absence of a fiduciary duty between the third-party plaintiff and counselor Bellini. Accordingly, this fact, standing alone, will not support dismissal. "

Law.Com reports this Philadelphia case.  "In opening statements on Tuesday in Adlerstein v. Duane Morris, physicist Joseph K. Adlerstein's attorney, Clifford E. Haines, said Duane Morris was responsible for his client only receiving $200,000 of a $1.8 million settlement with SpectruMedix, the company he founded. And that $200,000, he said, ultimately went toward rising legal bills from Duane Morris. Haines is the name partner with Clifford E. Haines & Associates. "

While the case is widely reported in Law.Com and other blogs, there are three standout items here which would have different results in NY:

1.  The defaulting payor filed a bankruptcy action;

2.  There is no discussion of "collectiblity" from the bankrupt;

3.  Plaintiff has already been found liable for attorney fees to Duane Morris.  There is no discussion of collateral estoppel based upon that finding.

Thoroughly investigate any human endeavor, and error can be found.  Legal malpractice law holds that one must demonstrate that "but for" the attorney's error, there would have been a better or different result.  This case, Cohen v Weitzner ,2008 NY Slip Op 00618 ,Decided on January 31, 2008 .Appellate Division, First Department  illustrates the rule:

"Plaintiffs allege that the settlement required them to pay more in taxes than they had anticipated based on a spreadsheet prepared for them by defendants in which, due to a typographical error, their tax liability for the year 2000 was understated by $121,000, and that they have been damaged in that amount by defendants' misrepresentation. However, plaintiffs' tax liability was correctly reflected in the returns they filed before retaining defendants and entering into the settlement agreement. In any event, their tax liability was not the subject of the negotiations with the IRS. Thus, plaintiffs fail to allege how defendants' error damaged them (see Lama Holding Co. v Smith Barney, 88 NY2d 413, 421-422 [1996]; Zarin v Reid & Priest, 184 AD2d 385, 386-387 [1992]). Further, as defendants were retained to try to obtain a reduction in the penalties assessed against plaintiffs, and they succeeded, there can be no claim
that they breached a duty to plaintiffs (see generally Dweck Law Firm v Mann, 283 AD2d 292, 293 [2001]). "

When does a municipality have knowledge of "the essential facts" upon which a claim is made, and when does a municipality have "actual knowledge"?  This seemingly small distinction has grave consequences for a plaintiff, and incidentally plaintiff's attorney,

Matter of Felice v Eastport/South Manor Cent. School Dist. ,2008 NY Slip Op 00691 ,Decided on January 29, 2008 ,Appellate Division, Second Department .

"CRANE, J.P. An injured person who has failed to serve a timely notice of claim may, pursuant to General Municipal Law § 50-e(5), apply for permission to serve a late notice. Among the "facts and circumstances" a court must consider in determining an application for permission to serve a late notice of claim are the actual knowledge of the public corporation of the "essential facts constituting the claim" and the prejudice to the public corporation from a claimant's failure to serve a timely notice of claim (General Municipal Law § 50-e[5]). Here, we take the opportunity to clarify the standards relevant to the courts' exercise of discretion in deciding these applications, so the outcomes are more predictable and not merely the product of judicial whimsy. More precisely, we grapple with the distinction between, on the one hand, the knowledge obtained by a public corporation [including a school district (see General Municipal Law § 50-e[1][a]; [*2]General Construction Law §§ 66[1]-[4])] of the "essential facts constituting the claim," and, on the other, the knowledge obtained by a public corporation of facts about an accident and the resulting injury that do not amount to the essential facts constituting the claim. We also analyze the effect of this distinction in determining whether the lack of a timely notice of claim has substantially prejudiced a public corporation in its ability to defend the claim on the merits.
 

We have consistently held that a public corporation's knowledge of the accident and the injury, without more, does not constitute "actual knowledge of the essential facts constituting the claim" (General Municipal Law § 50-e[5]; see Weber v County of Suffolk, 208 AD2d 527, 528), at least where the incident and the injury do not necessarily occur only as the result of fault for which it may be liable. In order to have actual knowledge of the essential facts constituting the claim, the public corporation must have knowledge of the facts that underlie the legal theory or theories on which liability is predicated in the notice of claim; the public corporation need not have specific notice of the theory or theories themselves.

Finally, a claimant seeking leave to serve a late notice of claim pursuant to General Municipal Law § 50-e(5) bears the burden of showing that the delay will not substantially prejudice the public corporation in maintaining its defense on the merits (see Jordan v City of New York, 41 AD3d 658; Matter of Dumancela v New York City Health & Hosps. Corp., 32 AD3d 515, 516; Breedon v Valentino, 19 AD3d 527, 528). It makes sense that the burden of establishing the lack of prejudice be placed on the claimant, who, after all, is seeking to excuse his or her failure to comply with the statute. Of course, when the public corporation has actual knowledge of the facts constituting the claim, it may be easier for a claimant to meet this burden (see Gibbs v City of New York, 22 AD3d 717, 719). Indeed, the Court of Appeals has recently observed that "proof that the defendant had actual knowledge is an important factor in determining whether the defendant is substantially prejudiced by such a delay" (Williams v Nassau County Med. Ctr., 6 NY3d at 539; see Jordan v City of New York, 41 AD3d 658; Matter of Vasquez v City of Newburgh, 35 AD3d 621, 623; Rechenberger v Nassau County Med. Ctr., 112 AD2d 150, 153). Thus, for example, in Jordan v City of New York, which concerned a car accident, the claimant, the driver, was able to establish that the City had actual knowledge of the essential facts constituting the claim because the passengers in his car had served timely notices of claim. A fortiori, the City was not prejudiced by his delay in serving a timely notice of claim (see Jordan v City of New York, 41 AD3d 658).

Here is a case from Louisiana found by the Law Profession Blog..  While it has very unfamiliar language in it, the situation is very familiar.  Doctor is sued for medical malpractice.  He does not have a consent policy.  Carrier settles without telling him some important things, such as, they waived a jury trial for him.  He sues the carrier and the attorneys for settling without telling him.  Result?  The case continues.  Dismissal in favor of the carrier reversed.

Here are some of the interesting terms:  "precription"  "permeptory exception of peremption." 

Familar issues:  discovery versus statute of limitations, waiting too long to sue.  The court says: "After careful review of the record, we find it was reasonable for Dr. Teague not to recognise what prompted the defendants to mediate and settle...."

Yesterday we reported that the Purlite legal malpractice case was going to the jury;  it appeared from reports that a question of the statute of limitations would be the most important issue.  Now, breaking news is that the trial ends with a defense verdict, but on the merits and not on the question of the statute of limitations.  From NY Lawyer:

"Morgan Lewis & Bockius yesterday defeated a $20 million breach of contract claim brought by a former client.

The 12 jurors in Brodie v. Morgan Lewis came back just before noon after three-and-one-half hours of deliberations over two days. They were unanimous in their defense verdict.

While the jury found that Bro-Tech Corp. - operating as Purolite - and its owners Don and Stefan Brodie properly brought the suit within the four-year statute of limitations, they said Morgan Lewis did not breach its contract with the Brodies by advising them to continue selling their water filtration products to companies in Cuba.

The case was held before Senior Judge Albert W. Sheppard in Philadelphia's Commerce Court Program.

The verdict is a win for Morgan Lewis as well as its counsel, William J. O'Brien and Nancy Gellman of Conrad O'Brien Gellman & Rohn. "

It may be a sign of the new economic times, or it may simply be a new trend, but legal malpractice cases are increasing in the bankruptcy setting.  NY Lawyer reports a fraudulent concealment - legal malpractice case by the trustee against an attorney and firm today.

"In In re Food Management Group (Grubin v. Rattet), 04-22880, Judge Martin Glenn ruled that allegations of fraudulent concealment, breach of fiduciary duty, negligence and fraud on the court could proceed against attorneys Robert L. Rattet and Jonathan S. Pasternak, as well as the law firm Rattet, Pasternak & Gordon Oliver.

The lawyers and the firm are accused of failing to disclose that an "insider" of debtor Food Management Group had violated a court order by submitting a bid in the auction of the company's assets.

The trustee also alleged that the lawyers improperly failed to disclose that they had represented one of the insiders before the auction.

Judge Glenn said that if the allegations are proven, the attorneys and their firm engaged in "serious wrongdoing."

Purolite hired defendant law firm Morgan Lewis & Bockius for advice on whether they could sell products to Cuba.  The law firm gave advice, Purolite came under criminal investigation, and a law suit was born. NY Lawyer reports

"Both sides said Morgan Lewis' original advice in 1993 was for the company to stop all sales to Cuba and a memorandum was sent to all employees to that effect. When two Purolite sales people from Canada and the United Kingdom called to say such a move would put them in violation of their respective countries' blocking orders, Morgan Lewis advised Purolite days later to continue to sell to Cuba from foreign offices but to ensure that there was no U.S. involvement with those sales, Purolite's attorney told the jury."

Now, it seems the central issue at the trial of this case is the statute of limitations.  When did Purolite realize it had a legal malpractice cause of action?  "After more than two weeks of testimony and years of previous litigation, the $20 million case that pits water filtration company Purolite against its former law firm, Morgan Lewis & Bockius, could come down to the first question on the verdict sheet – whether the case is barred by the statute of limitations.

Although attorneys for both sides in Bro-Tech v. Morgan Lewis spent the majority of yesterday morning's closing statements discussing whether Purolite and its owners, Stefan and Don Brodie, should prevail in their breach of contract claim against the firm, they concluded with discussions of whether the claim was properly filed within the four-year statute of limitations. Bro-Tech is the parent company of Purolite ."

This case has gone from US District Court to the US Court of Appeals for the Second Circuit, to the NY Court of Appeals, and back to District Court.  It's a case in which the question now is whether the retainer agreement is in effect, whether misconduct by the attorney vitiates the agreement, and to whom a big fee goes.

"This dispute between the plaintiff, Edward C. King ("King" or the "Plaintiff"), a musician, and his lawyer, defendant Lawrence A. Fox ("Fox" or the "Defendant") concerning the retainer agreement between them has occupied this Court, the magistrate judge, the Court of Appeals on two occasions, and the New York Court of Appeals over the past ten years. Presently at issue is Fox's motion to strike King's demand for a jury trial; initially made in August, 2003, deferred as a consequence of the grant of summary judgment for Fox in January, 2004, and renewed on October 31, 2007, after the remand from the Court of Appeals on August 11, 2006. For the reasons stated below, the motion will be denied."

22 NYCRR 1215 is a section of the law that governs attorney fees and engagement letters or retainer agreements.  Until recently, courts have had differeing interpretations of the penalty when an attorney seeks fees but has no retainer agreement or engagement letter.

The cases were decided in three different ways:  the first allowed the attorrney fees determined in quantum meruit, the second was that the attorney could keep collected fees but no future fees, and the third was to allow no fees at all.

Along came the case of Rubenstein v. Ganea held:

"We find that a strict rule prohibiting the recovery of counsel fees for an attorney's noncompliance with 22 NYCRR 1215.1 is not appropriate and could create unfair windfalls for clients, particularly where clients know that the legal services they receive are not pro bono and where the failure to comply with the rule is not willful (see Matter of Feroleto, supra at 684). Our holding would be different were this matter a matrimonial action governed by the more stringent disciplinary requirements of 22 NYCRR 1400.3 and Code of Professional Responsibility DR 2-106 (c) (2). Here, Ganea concedes in her reply brief that "she did not think all legal services received would be free." Rubenstein's failure to comply with 22 NYCRR 1215.1 was unintentional, no doubt attributed to the promulgation of the rule only seven weeks prior to his retention. Accordingly, the{**41 AD3d at 64} Supreme Court correctly held that Rubenstein could seek recovery of attorneys' fees upon the theory of quantum meruit.[FN7]"

Now, the case of Mallin v. Nash in New York County adopts the Second Department's holding:

"Public policy dictates that courts pay particular attention to fee arrangements between attorneys and their clients, as it is important that a fee contract be fair, reasonable, and fully known and understood by the client (see Jacobson v Sassower, 66 NY2d 991, 993, 499 NYS2d 381, 489 NE2d 1283 [1985]; Shaw v Manufacturers Hanover Trust Co., 68 NY2d 172, 176, 507 NYS2d 610, 499 NE2d 864 [1986]; Matter of Bizar & Martin v U.S. Ice Cream Corp., 228 AD2d 588, 644 NYS2d 753 [2d Dept 1996]). If the terms of a retainer agreement are not established, or if a client discharges an attorney without cause, the attorney may recover only in quantum meruit to the extent that the fair and reasonable value of legal services can be established (see Matter of Cohen v Grainger, Tesoriero & Bell, 81 NY2d 655, 658, 602 NYS2d 788, 622 NE2d 288 [1983]; Campagnola v Mulholland, Minion & Roe, 76 NY2d 38, 43, 556 NYS2d 239, 555 NE2d 611 [1990]; Matter of Schanzer, 7 AD2d 275, 182 NYS2d 475 [1st Dept 1959], affd 8 NY2d 972, 204 NYS2d 349, 169 NE2d 11 [1960]).

 In Mallin, the attorney was awarded no fees under quantum meruit.

Small or Multi-billion dollar case, legal malpractice cases all rest upon the same three bases:  deviation from accepted practice, proximate cause and damage.  As an example, here is a smallish case from the Madison Record:

"A legal malpractice claim filed by Cydney Hollaway against Fairview Heights attorney Thomas C. Rich alleges she did not receive an adequate award for injuries in a workers' compensation claim.

Hollaway, represented by Patricia A. Zimmer of Ripplinger & Zimmer in Belleville, is seeking in excess of $50,000 in damages plus costs of the suit.

According to the suit filed Jan. 22 in St. Clair County Circuit Court, Rich allegedly presented Holloway's claim to an arbitrator as one for wage differential instead of one for permanent total disability.

Holloway was injured while working for Four Truckers, Inc. on Feb. 8, 2001, the suit claims. Holloway contracted with Rich on Feb. 15, 2001, whereby Rich would represent Holloway in a work comp claim.

"On December 13, 2005, defendant presented plaintiff's claim at a hearing before Illinois Workers Compensation Commission Arbitrator John Dibble," the complaint states.

"On January 23, 2006, Arbitrator Dibble issued his decision, which awarded plaintiff compensation in the form of a wage differential."

Holloway claims she had a viable claim for permanent total disability and would have been successful in obtaining an award, "but for defendant's negligence."

From an unpublished Illinois case, discussed  by  the Illinois Legal Malpractice Blog, we are reminded of the fact that a bankruptcy filing will generally cut off plaintiff's right to bring any law suit, including the legal malpractice case.  Two things that always bear review:

1.  When one files bankruptcy, everything, including potential unpled causes of action become part of the bankrupt's estate, and no longer personal to the bankrupt;

2.  Attorney fee disputes serve as collateral estoppel to a later legal malpractice case.

On some ocassions, the dissection of a case yields interesting insights.  Here is a Second Department Case: Petersen v Lysaght, Lysaght & Kramer, P.C. ,  2008 NY Slip Op 00472
Decided on January 22, 2008 ,Appellate Division, Second Department  which illustrates several points:

1.  Some cases are a problem from begining to end.  In this case there have been three appeals, and the case ends when plaintiff fails to file a note of issue, and cannot explain why, or show a meritorious case.

2.  Nassau and Suffolk notes of issue dates are sacrosanct.  "The certification order of the Supreme Court dated February 3, 2006, directing the plaintiff to file a note of issue within 90 days and warning that the action would be deemed dismissed without further order of the court if the plaintiff failed to comply with that directive, had the same effect as a valid 90-day notice pursuant to CPLR 3216 (see Louis v MTA Long Is. Bus Co., 44 AD3d 628; Hoffman v Kessler, 28 AD3d 718).

3.  Louis is more often cited for the proposition that the order of court [Kings, for example] did not have the same effect as a CPLR 3216 notice.

4.  It is usually a bad sign when the plaintiff-Appellant's attorney is not listed on the appellate decision.  Generally, it means that the attorney did not ask for, or attend for oral argument.  Often a bad choice, it tells the court that appellant is not really interested in the outcome.

5.  This court determined that everyone here made mistakes:

"Moreover, the plaintiff's motion papers failed to establish the existence of a meritorious cause of action. Contrary to the plaintiff's contention, we have not previously decided this issue in his favor. On a prior appeal, we held that the Supreme Court should have denied those branches of a motion by the defendants Lysaght, Lysaght & Kramer, P.C., Peter Kramer, and Michael Balducci (hereinafter the defendants) which were to dismiss certain of the plaintiff's causes of action insofar as asserted against them as barred by the doctrine of collateral estoppel (see Petersen v Lysaght, Lysaght & Kramer, 250 AD2d 581). On a second prior appeal, we held that the Supreme Court should have denied a motion by the defendants for summary judgment dismissing the same causes of action, on the ground that they failed to establish their prima facie entitlement to judgment as a matter of law (see Petersen v Lysaght, Lysaght & Kramer, 288 AD2d 281). Finally, on a third prior appeal, we reversed so much of an order of the Supreme Court as granted a motion by the defendants for leave to renew their prior summary judgment motion, on the ground that they failed to meet the requirements of CPLR 2221(e)(3)(see Petersen v Lysaght, Lysaght & Kramer, P.C., 19 AD3d 391). Thus, we have never previously held that the subject causes of action are, in fact, meritorious.

6.  One really should put everything into demonstrating a meritorious cause of action.  "To establish the merit of his claims, the plaintiff tendered a copy of his verified complaint, which, in relevant part, stated that "[t]he defendants made no efforts to secure a default judgment" against a defendant in an underlying personal injury action, thereby committing legal malpractice. Without even a modicum of proof that a default judgment properly could have been obtained against that defendant in the underlying action (see Woodson v Mendon Leasing Corp., 100 NY2d 62, 70-71; CPLR 3215[f]), we cannot conclude that the plaintiff established the existence of a meritorious cause of action to recover damages for legal malpractice.

We've reported on the widespread influence of Deleware corporate law.  Many attorneys seemingly practice Delaware law without setting a foot there, without holding themselves out as Delaware attorneys.  This happens when they advise corporate clients on how Delaware would act.

Here, in a Hinshaw report, is the collalary:  Delaware exercising personal jurisdiction over an ever widening group of lawyers.  "The Delaware Court of Chancery held that it had personal jurisdiction over an out of state law firm alleged to have been involved in a client’s tortious schemes because, inter alia, the law firm filed a corporate certificate amendment in Delaware. "  Read the entire report

Its Idaho, and its Winter.  However, this is not a weather blog.  Here is a case illustrating the age old conflict of interest between the insured and its insurer.  Here, the insured says that defendant attorney's mission was to protect the insurance company, not the insured.

The Times-News reports: "St. Luke's Magic Valley Regional Medical Center has sued a Washington attorney who once represented the hospital in an ongoing dispute, saying the attorney did not adequately defend against claims of Medicare fraud and other alleged improprieties.

The complaint, filed Jan. 17 in U.S. District Court in Boise, claims that Tom Luciani intentionally breached his fiduciary duty and committed professional malpractice while representing the hospital and Farmers Insurance between July 2003 and early 2006. Luciani was brought on by the insurance company to represent the hospital during litigation that started in 2001 with a tort claim against the hospital by two former employees.
According to the hospital's most recent court filing, Luciani had a longstanding relationship with Farmers, which brought him in to replace another lawyer when the case moved to federal court. Following the desires of the insurance company, the complaint states, Luciani's strategy focused on protecting Farmers from any damages while leaving the hospital open to a possible $22 million judgment.

After the hospital discovered Luciani had no plan to produce an expert witness to counter testimony from a plaintiff's witness it hired its own counsel in 2006 - Chicago-based McDermott, Will and Emery LLP, one of the largest law firms in the country. "

Here is an Idaho Decision from the Supreme Court of Idaho, which discusses how the statements of an attorney, representing his client in a court proceeding. may be used against him later, as "admissions,"

"The issue is, whether an attorney's statements in the course of representation fo a client may be used against that attorney in a subsequent legal malpractice case."  Here, the Supreme Court says they may not be used.  Read this thoughful opinion.

Here is a New York Law Journal report of a legal malpractice case involving the White House, sitting judges, and other big players.

"Blackwater Security filed a $30 million malpractice suit against Washington, D.C., law firm Wiley Rein on Wednesday, alleging the firm made costly missteps in a wrongful death case brought on behalf of four former Blackwater employees who were killed in Iraq in 2004. The complaint, filed in D.C. Superior Court, claims Wiley Rein lawyers filed sloppy pleadings that ultimately barred Blackwater from shifting the case from a state court in North Carolina to federal district court, where the security firm could have mounted a stronger defense. After losing its bid to have the case transferred in October 2005, Blackwater discarded its Wiley Rein team, which included: Fred Fielding, now White House counsel; Barbara Van Gelder, now an attorney with Morgan, Lewis & Bockius; Scott McCaleb, who is a partner with Wiley Rein; and Margaret Ryan, now a judge for the U.S. Court of Appeals for the Armed Forces.

Many legal malpractice cases arise from failures to file a notice of claim against a municipality or against the state.  The case law is rife with General Municipal Law mistakes, as well as Court of Claims Act errors.  This case, which involves not New York but Louisiana, shocks the conscience.

Boudreaux v. State of Louisaina Department of Transportation, decided yesterday in the Appellate Division 1st Department reminds us that no matter how difficult it is to litigate against the City or State, Louisiana is a whole 'nuther place. 

"The Court of Appeals of Louisiana, Second Circuit, recently opined that "[a] judgment creditor of a political subdivision of the state has no way to collect its judgment except by appropriation ... Appropriation of funds is discretionary and not ministerial, and mandamus will not lie to compel payment of a judgment by a political subdivision" (The Newman Marchive Partnership, Inc. v City of Shreveport, 962 So2d 1075, 1077 1078 [La 2007], see also Cooper v Orleans Parish School Bd., 742 So2d 55, 64 [La 1999], writ denied 751 So2d 858 [La 1999]).

Plaintiffs herein have registered their judgment in 18 Louisiana parishes but, to date, the Louisiana Legislature has declined to appropriate the funds necessary to pay that judgment. As a result, plaintiffs now seek, in our view, to do an end run around their own legislature, and the laws of their home state, by attempting to enforce the judgment in the New York courts.

So, win your case, and the State of Louisiana need not pay it, ever. 

Qualcom v. Boradcom Corp. is an important case.  Duane Morris reports that it will set the standard for all electronic discovery in litigation.  Once the standard is set, attorneys will be expected to heed and obey.

"The district court was particularly concerned with upholding the good faith standard necessitated by the discovery system and emphasized that for the system to work in a time when documents are stored electronically, "attorneys and clients must work together to ensure that both understand how and where electronic documents, records and emails are maintained and to determine how best to locate, review, and produce responsive documents."

Emphasizing that it is the responsibility of attorneys (both in-house counsel and retained counsel) to make certain that their clients carry out an effective and comprehensive document search, the court noted that "[p]roducing 1.2 million pages of marginally relevant documents while hiding 46,000 critically important ones does not constitute good faith and does not satisfy either the client's or attorney's discovery obligations." The court suggested that in-house counsel have a duty to confirm the veracity of any signed papers produced during discovery.

The district court's solution was to order Qualcomm to implement a "comprehensive Case Review and Enforcement of Discovery Obligations ('CREDO') program" which, at a minimum, includes:

(1) identifying the factors that contributed to the discovery violation . . . , (2) creating and evaluating proposals, procedures, and processes that will correct the deficiencies identified in subsection (1), (3) developing and finalizing a comprehensive protocol that will prevent future discovery violations . . . , (4) applying the protocol that was developed in subsection (3) to other factual situations, such as when the client does not have corporate counsel, when the client has a single in-house lawyer, when the client has a large legal staff, and when there are two law firms representing one client, (5) identifying and evaluating data tracking systems, software, or procedures that corporations could implement to better enable inside and outside counsel to identify potential sources of discoverable documents . . . , and (6) any other information or suggestions that will help prevent discovery violations.

The court ordered that the attorneys submit a proposed protocol for the court to evaluate and revise, if necessary. While the district court's immediate goal was to remedy this specific instance of misconduct, the court hoped that its opinion would be a "road map" for electronic discovery and would "assist counsel and corporate clients in complying with their ethical and discovery obligations and conducting the requisite 'reasonable inquiry.'"

Electronic Discovery is with us, has been regulated, and there are now standards for its use in litigation.  Attorneys for clients now have to advise on how to store, produce, resist demands, and comply with the appropriate rules.

Whenever there is general agreement upon a standard of practice, the question of deviation from that standard arises.  This is the central tenant of legal malpractice:  if there is a standard, attorneys must adhear. 

Duane Morris reports on the Quallcom case: "The U.S. District Court for the Southern District of California's latest opinion in Qualcomm Inc. v. Broadcom Corp., Case No. 05cv1958 (BLM) (S.D. Cal.), issued on January 7, 2008, serves as a warning to all corporate litigants regarding electronically stored documents and emails. This warning is especially applicable for in-house counsel, of which several were engulfed in this quagmire. The court ordered Qualcomm to pay all of Broadcom's litigation costs — around $8.5 million — for "intentionally with[holding] tens of thousands of decisive documents from its opponent in an effort to win this case and gain a strategic business advantage over Broadcom." In addition, the attorneys most heavily involved were referred to the California State Bar for violations of their ethical duties. "

What does a client do when faced with an attorney fee demand?  As is true with most things in life, a reflexive response is precisesly the wrong move.  Many clients [and unfortunately many attorneys] advise or choose to arbitrate the fee dispute.  Bravely, they go to the arbitration and argue piecemeal against the fee.

Let's look at an example.  In a matrimonial action, attorney for wife bills $ 150,000.  Husband is required to pay $ 100,000 and wife is billed for $ 50,000.  Let's assume that she is really really  unhappy with the outcome, and believes that there has been malpractice.  What should she do?

The first thought is fee arbitration.  Many think that the fee can be trimmed, or trimmed significantly, and go in to the arbitration arguing that there has been malpractice.  Why is this bad?

A recent case, Pickard v Tarnow ,2007 NY Slip Op 52377(U) [18 Misc 3d 1102(A)] ,Decided on December 3, 2007 ,Supreme Court, New York County ,Madden,  illustrates the problem.

In a nutshell, if the arbitrators allow any fees,  even a dollar, they have implicitly determined that there is no legal malpractice, and there can be no future legal malpractice case brought.

"Although the court has jurisdiction over the defendants, the action against them must be dismissed as barred under the doctrine of collateral estoppel based on the determination in the arbitration that Tarnow was entitled to recover fees for his legal services despite Pickard's assertion in that proceeding of defects in Tarnow's representation of her.

Collateral estoppel or "issue preclusion" prevents a party from relitigating an identical issue which has previously been decided against it in a prior action in which it had a fair opportunity to fully litigate the issue. See Allied Chemical v Niagara Mohawk Power Corp., 72 NY2d 271 (1988), cert denied, 488 US 1005 (1989). The party seeking to invoke the doctrine of collateral estoppel must show that the issue was necessarily decided in the earlier action, while [*3]the party who opposes the application of collateral estoppel must demonstrate that it did not have a full and fair opportunity to contest the prior determination. Buechel v Bain, 97 NY2d 295, 303-04 (2001).

Here, defendants have met their burden of demonstrating that the issue of malpractice was necessarily decided during the arbitration of the fee dispute in which Pickard contested the fee based on substantially the same alleged acts of malpractice that provide the basis for this action. See Weinstein v. Cohen, 2007 WL 3407107,AD2d(2d Dept 2007)(holding that plaintiff's action alleging that defendants charged her excessive fees and committed legal malpractice in connection with their representation of her in a matrimonial action was precluded by prior determination that defendants were entitled to a substantial portion of the total fees they sought in a fee arbitration requested by plaintiff pursuant to 22 NYCRR Part 136); Altamore v Friedman, 193 AD2d 240, 244 (2d Dept 1993), lv dismissed, 83 NY2d 906 (1994) (holding that client was barred from bringing a legal malpractice action against his attorney after an arbitration award was issued in attorney's favor in connection with a fee dispute since both the fee arbitration and the legal malpractice action shared "at the core, claims of attorney malpractice"); Kinberg v. Garr, 28 AD3d 245, 246(1st Dept 2006)("[p]laintiff's adverse determination in defendants' prior action to recover fees for the rendering of professional services precludes a finding of malpractice with regard to the same services); Djeddah v. Starr, 306 AD2d 59 (1st Dept), lv denied, 100 NY2d 516 (2003)(client's arguments based on claims of malpractice were barred by prior unappealed order recognizing attorney's charging lien and referring the matter for an assessment).

Moreover, although the arbitrators did not directly state whether their determination included the malpractice issues, all of the allegations set forth by Pickard in her Fee Dispute Application and in her supporting documentation focus on Tarnow's alleged misconduct in his representation of her in her divorce case. In addition, it can inferred from the arbitrators' statement that their decision was "based on a voluminous record," that they reviewed and considered all of the evidence before them.

Furthermore, Pickard does not argue that she did not have a full and fair opportunity to litigate the issue of Tarnow's alleged malpractice in the arbitration. In fact, the exhibits submitted by defendants in support of this motion, indicate that Pickard provided the arbitrators with detailed submissions to support her assertion that Tarnow had committed malpractice and therefore should not be awarded a fee.

Pickard maintains, however, that the arbitrators did not have authority to consider the issues of legal malpractice, such that there was no adjudication of those issues in the fee arbitration. Specifically, Pickard contends that the arbitration was conducted pursuant to 22 NYCRR 137 (Part 137), which "establishes the New York State Fee Dispute Resolution Program, which provides for the informal and expeditious resolution of fee disputes between attorneys and clients through arbitration and mediation," and which excludes "claims involving substantial legal questions, including professional malpractice or misconduct." (22 NYCRR 137.1(b)(3)).

This argument is unavailing. Since Part 137 is applicable to cases "where representation has commenced on or after January 1, 2002" (22 NYCRR 137.1(a)), it does not apply to the parties' fee arbitration, as it is undisputed that defendants commenced their representation of [*4]Pickard prior to that effective date. Rather, the provisions of 22 NYCRR 136 (Part 136) continue to apply to fee disputes in all domestic relations matters subject to that Part in which representation began prior to January 1, 2002.

Unlike the bar to adjudicating legal malpractice claims contained in Part 137, Part 136 contains no such limitation. Pursuant to Part 136.4 (b), "[t]he Administrative Judge may decline to accept or continue to arbitrate a dispute in which substantial legal questions are raised in addition to the basic fee dispute." Here, as the arbitration was held despite the issues of malpractice raised by Pickard, the arbitrators were entitled to consider these issues.

Accordingly, as defendants have met their burden of demonstrating that the identical issue of malpractice was necessarily decided in connection with the arbitration, and as Pickard has not shown that she did not have a full and fair opportunity to be heard on the issue, the doctrine of collateral estoppel bars this action for legal malpractice. "

It is rare to see a pro-se defendant in the rarified air of Federal District Court, even more rare for both sides to be pro-se.  Here,  in DANIEL KIRK and LINDA KIRK, v.  JOSEPH M. HEPPT, ESQ.,
05 Civ. 9977 (RWS) UNITED STATES DISTRICT COURT FOR THE SOUTHERN DISTRICT OF NEW YORK January 16, 2008, Filed , the tide seems to be turning in favor of the defendant attorney. 

Plaintiff unsuccessfully sued for employment discrimination, and when the case failed, turned, pro-se to sue his attorney.  The attorney counterclaimed for defamation and his fees.  Federal District Court Judge Sweet found everyone's position to be deficient in some manner:

"The Plaintiffs' first cause of action alleges a violation of 18 U.S.C. § 1341, the federal mail fraud statute, and is based upon the mailing of allegedly fraudulent invoices from Heppt's office in Manhattan to the Kirks' residence in New Jersey (Compl. P 23). However, there is no private right of action for violations of the federal mail fraud statute. See Pharr v. Evergreen Garden, Inc., 123 Fed. Appx. 420, 422 (2d Cir. 2005) ("The law in this circuit is clear that [18 U.S.C. § 1341] does not support any private right of action."). The cause of action for mail fraud [*6] under 18 U.S.C. § 1341 is dismissed.

In addition, the Complaint can be read as asserting a claim for common law fraud. To maintain a claim for common law fraud, a plaintiff must be able to show a causative link between the alleged fraud and his claimed damages. See, e.g., Friedman v. Anderson, 803 N.Y.S.2d 514, 517 (N.Y. App. Div. 2005) (granting a motion to dismiss a fraud claim for failure to demonstrate that defendants' actions were the proximate cause of the claimed losses). With regard to fraud arising from the mailed invoices, the March 20, 2006, Memorandum Opinion denying the Plaintiffs leave to file an amended complaint stated that the Plaintiffs "will be unable to demonstrate that Defendant's mailing of fraudulent invoices was the proximate cause of their alleged injuries." Kirk v. Heppt, 423 F. Supp. 2d at 151.

The Plaintiffs' second cause of action alleges a scheme to defraud, in violation of New York Penal Law § 190.60. The New York State Legislature modeled the "scheme to defraud" crime on the federal mail fraud statute. People v. First Meridian Planning Corp., 86 N.Y.2d 608, 616 (1995); William C. Donnino, Practice Commentary, N.Y. Penal Law § 190.60 (McKinney 1998) ("Given [*7] parallel language in the two statutes, New York courts have found federal cases construing the mail fraud statute relevant to the construction of New York's 'scheme to defraud.'"). Because neither the New York State legislature nor any New York court has interpreted § 190.60 as providing a private cause of action, the claim based on the N.Y. Penal Law § 190.60 is dismissed.

The NY General Business Law § 349 Cause of Action is Dismissed

New York General Business Law § 349 applies solely to matters affecting the consumer public at large. Vitolo v. Mentor H/S. Inc., 213 Fed. Appx. 16, 17 (2d Cir. 2007). Private contract disputes, unique to the parties, are not covered by the statute. Oswego Laborers' Local 214 Pension Fund v. Marine Midland Bank, N.A., 85 N.Y.2d 20, 24-25 (1995). See also Amadasu v. Ngati, et al., No. 05 Civ. 2585 (JFB), 2006 U.S. Dist. Lexis 19654, at *35-36 (E.D.N.Y. Mar. 27, 2006) (dismissing a Section 349 claim arising out of an attorney-client relationship for failure to state a consumer protection claim) (citing, inter alia, Exxonmobil Inter-America, Inc. v. Advanced Info. Eng'g Servs., Inc., 328 F. Supp. 2d 443, 447 (S.D.N.Y. 2004)).

The Complaint here is limited [*8] to a dispute between the Plaintiffs and the Defendant arising out of the attorney-client relationship, which is essentially contractual in nature. The broader impact on consumers at large is not adequately alleged. For the reasons stated above, the Plaintiffs' claim based on New York (General Business Law § 349 is dismissed as a matter of law.

The Claim for Breach of Fiduciary Duty is Dismissed in Part

Although the Kirks have not explicitly asserted a cause of action for legal malpractice, under New York law, claims for legal malpractice and claims for breach of fiduciary duty in the context of attorney liability are coextensive. Weil, Gotshal & Manges, LLP v. Fashion Boutique of Short Hills, Inc., 780 N.Y.S.2d 593, 596 (N.Y. App. Div. 2004); see also Nordwind v. Rowland No. 04 Civ. 9725 (AJP), 2007 U.S. Dist. LEXIS 75764, at *20 (S.D.N.Y. Oct. 10, 2007) (citations omitted); Guiles v. Simser, 826 N.Y.S.2d 484, 485 (N.Y. App. Div. 2006) (treating Plaintiff's cause of action, although labeled as a breach of fiduciary duty, as a claim of legal malpractice). To the extent that the Kirks' claim for breach of fiduciary duty is based upon Heppt's handling of Daniel's case against his former [*9] employer before the Honorable Sidney H. Stein, see Kirk v. Schindler Elevator Corp., No. 03 Civ. 8688 (SHS), 2004 WL 1933584 (S.D.N.Y. Aug. 31, 2004), their claim will be treated as a claim for legal malpractice.

A cause of action for legal malpractice poses a question of law which can be determined on a motion to dismiss. Achtman v. Kirby, McInerney & Squire, LLP, 464 F.3d 328, 337 (2d Cir. 2006) (citing Rosner v. Paley, 65 N.Y.2d 736, 738 (1985)) (quotation marks omitted). In order to state a claim for legal malpractice under New York law, a plaintiff must adequately allege 1) an attorney-client relationship, and 2) attorney negligence, 3) which is the proximate cause of, 4) actual damages. Nordwind, 2007 U.S. Dist. LEXIS 75764, at *22; see also Pellegrino v. File, 738 N.Y.S.2d 320, 323 (N.Y. App. Div. 2002), lv denied, 98 N.Y.2d 606. Insofar as the Kirks are seeking damages for the value of the claim lost, they must establish the elements of proximate cause and actual damages by "demonstrat[ing] that 'but for' the attorney's conduct the client would have prevailed in the underlying matter or would not have sustained any ascertainable damages." Trautenberg v. Paul, Weiss, Rifkind, [*10] Wharton & Garrison, LLP, No. 06 Civ. 14211 (GBD), 2007 U.S. Dist. LEXIS 56222, at *9 (S.D.N.Y. Aug. 2, 2007) (citing Fashion Boutique of Short Hills, 780 N.Y.S.2d at 596). "Notwithstanding counsel's purported negligence, the client must demonstrate his or her own likelihood of success; absent such a showing, counsel's conduct is not the proximate cause of the injury. Nor may speculative damages or conclusory claims of damage be a basis for legal malpractice." Russo v. Feder, Kaszovitz, Isaacson, Weber, Skala & Bass, LLP, 301 A.D.2d 63, 67 (N.Y. App. Div. 2002) (citing Pellegrino, 738 N.Y.S.2d 320,). See also Morgan, Lewis & Bockius, LLP v. IBuyDigital.com, Inc., 2007 NY Slip Op 50149U, at 6 (N.Y. Misc. 2007).

In order to establish negligence in a legal malpractice case, a plaintiff must allege that the attorney's conduct "'fell below the ordinary and reasonable skill and knowledge commonly possessed by a member of the profession.'" Achtman, 464 F.3d at 337 (quoting Grago v. Robertson, 370 N.Y.S.2d 255 (N.Y. App. Div. 1975)). While "an attorney may be held liable for 'ignorance of the rules of practice, failure to comply with conditions precedent to suit, or for his neglect to prosecute [*11] or defend an action," Achtman, 464 F.3d at 337 (quoting Bernstein v. Oppenheim & Co., 554 N.Y.S.2d 487 (N.Y. App. Div. 1990)), "[a] complaint that essentially alleges either 'an error in judgment' or a 'selection of one among several reasonable courses of action' fails to state a claim for malpractice," id. (quoting Rosner, 65 N.Y.2d at 738).

Construing the complaint liberally in Plaintiffs' favor, the Kirks' allegations regarding Heppt's failure to thoroughly investigate Daniel's ERISA plan and exhaust all administrative remedies prior to filing suit may constitute negligence However, the Kirks have not sufficiently alleged proximate cause to withstand a motion to dismiss. Therefore, their claim for fiduciary duty with regard to these allegations is dismissed, with leave granted to replead. "

Here is the hypothetical:  Plaintiff hires attorney A to prosecute an action against the State of New York, and does not timely file a notice of claim.  There is still time within the statute of limitations to file a motion seeking leave to file a late notice of claim. 

Plaintiff hires attorney B to sue for legal malpractice. Is Attorney B required to try to mitigate by seeking leave?  If Attorney B does not, is he subject to third-party litigation?

The case of Eugene Cacho, v.The Law Offices of Louis Venezia and Louis Venezia,
102554/2006 SUPREME COURT OF NEW YORK, RICHMOND COUNTY ,2008 NY Slip Op 50111U;  says no.  Justice McMahon writes:

"With respect to the motion at hand, generally, where a law firm is retained for the limited and express purpose of representing a client in a legal malpractice action, they do not have a duty to prosecute the underlying claim, if one still lies (see Northrop v. Thorsen, AD3d , 2007 N.Y. App. Div. LEXIS 12903 [2d Dept., Dec. 18, 2007][finding that an attorney retained "in a separate matter, before a separate tribunal, and for a different purpose" does not require him to mitigate damages in the underlying claims); Johnson v. Berger, 193 AD2d 784, 786, 598 N.Y.S.2d 270 [2d Dept., 1993][holding that a law firm's failure to preserve an estate's assets, when retained for the limited purpose of prosecuting a legal malpractice action "did not contribute to or aggravate the plaintiffs' damages arising from the former attorneys' alleged legal malpractice"]).

Here, third-party defendant's have established entitlement to judgment in accordance with CPLR § 3211(a)(1) and (a)(7). The retainer [**4] agreement is clear and specific, detailing that the representation by the third-party defendants is for "damages arising from personal injuries sustained by Eugene Cacho as a result of legal malpractice." Further, the cases cited by the defendant/third-party plaintiff's are distinguishable from the instant matter in that here, the third-party defendant Minchew was not hired as successor counsel to prosecute the personal injury claim, but rather on a different matter, in front of a different Judge and for a different purpose (Northrop v. Thorsen, AD3d , 2007 N.Y. App. Div. LEXIS 12903 [2d Dept., Dec. 18, 2007]). As a result, defendant Minchew is under no obligation to file a late notice of claim and therefore, dismissal of the third-party complaint is warranted (see CPLR § 3211 [a][1], [a][7]; Northrop v. Thorsen, AD3d , 2007 N.Y. App. Div. LEXIS 12903 [2d Dept., Dec 18, 2007]; Johnson v. Berger, 193 AD2d at 786). "

Wrangles between lawyers is certainly no headline.  Lawyers allowing venom to overpower reason similarly is no news.  The case of Minchew, Santner & Brenner, LLP, and Jamie M. Minchew, v. John H. Somoza, Eleftherios Kravaris, Melito & Anderson, P.C., Westport Insurance Corporation and Louis Venezia, SUPREME COURT OF NEW YORK, RICHMOND COUNTY ,2008 NY Slip Op 50112U; January 17, 2008, is a prime example of failure to mitigate damages.

This case is an offshoot of another legal malpractice case.  Plaintiff hired Venezia to prosecute an action in the Court of Claims.  It is alleged that Venezia did not file the notice of claim timely.  His insurance defense attorneys asked plaintiff to file a motion seeking leave to file a late notice of claim, which was not done. 

When plaintiff would not try to mitigate his damages by moving for leave to file a late notice of claim, Venezia third-partied plaintiff's attorneys on the theory that they could have mitigated, but did not.  The Minchew firm [plaintiff's attorneys] then brought this retaliatory suit.  The court wrote:

"This action arises from an underlying legal malpractice 1 action currently pending before this Court, where Mr. Eugene Cacho's initial attorney, Louis Venezia, failed to timely file a notice of claim with the State of New York. As a result, Mr. Cacho severed his representation and hired the plaintiff Minchew Santner & Brenner LLP (hereinafter "Minchew"), and Jamie M. Minchew, personally, to represent him in a legal malpractice action against The Law Office of Louis Venezia (hereinafter Venezia). Venezia thereafter hired the defendants John H. Somoza, Eleftherios Kravaris, Melito & Anderson, P.C., (hereinafter collectively known as "Somoza"), to represent him in that matter. In the course of his representation, defendant Somoza requested that plaintiff [**2] Minchew apply to file a late notice of claim considering that the statute of limitations has not yet expired in the personal injury action, in effect, severely mitigating the damages and/or resolving the case. After this Court repeatedly recommended that the parties in this action cooperate and apply to file a late notice of claim, the defendants impleaded plaintiffs as a third party in the Cacho action which thereafter caused Minchew to bring this retaliatory action alleging the aforementioned causes of action. " 

When no one would play nice, the court wrote:  "As a result, all causes of action alleged by the plaintiff in their complaint are dismissed. All other requested relief is denied or academic. Finally, this Court will again strongly urge the attorneys involved in these matters to cooperate and set aside these vindictive and unnecessary actions in an effort to resolve [**9] this case. "

Question:  who is hurt when attorneys play like this?

The West Virginia Record reports this case in which plaintiff was terminated by his employer.  Plaintiff's claim is that he was fired for doing jury service.  He retained defendant attorney, and the case was litigated in Federal District Court, where it was dismissed on summary judgment. 

Plaintiff claims that the attorney did not depose supporting witnesses, did not follow up on deposition questions, and did not seek discovery.  Worst of all he claims that the attorney came to meeting intoxicated.

"Fleischmann says Deel accompanied him to several depositions throughout 2005 and 2006, but that he "failed to follow up on any deposition questions, and he failed (to) make contact or get depositions from any of the seven witnesses provided to him by me."

He says he also gave Deel physical and date documentation supporting his case, but Deel "appeared at both meetings apparently intoxicated, and failed to retain the information I tried to provide."

Fleischmann says he e-mailed the information to Deel, but he failed to act on it. And Deel failed to respond to numerous e-mail and phone requests for an update on the case, the complaint states.

On Dec. 1, 2005, PRG-Schultz filed a motion for summary judgment. Deel failed to respond, according to the complaint, and the case was dismissed Jan. 10, 2006.

Fleischmann says he learned on Feb. 8, 2006, that he and Deel had 24 hours to filed for reinstatement of the case. Fleischmann said he contacted Deel, who said he "was busy" and wouldn't do anything about it."

Here is our article from the New York Law Journal on Attorney Client Privilege and Legal Malpractice.

CEO Gregory Reyes was sentenced this week.  Judge Charles Breyer told him that a false affidavit netted him 21 months rather than 15 months.  Here's the problem for Reyes:  his attorney drafted the document, and admitted his own "poor drafting."

So, is this the rare occurrence when an attorney creates the situation in which his client spends more tim in jail? "Inexact drafting by lawyers for former Brocade CEO Gregory Reyes may have gotten an extra six months tacked onto his stock option backdating sentence.

U.S. District Judge Charles Breyer sentenced the former Silicon Valley icon to 21 months in prison Wednesday. Breyer also imposed a $15 million fine, but did not order Reyes to pay any restitution. Breyer stayed the entire sentence pending appeal.

Breyer indicated, however, he would have imposed a shorter, 15-month sentence had Reyes not submitted a sworn affidavit to the court saying he did not backdate.

Reyes filed that declaration in support of former HR Chief Stephanie Jensen's motion to sever her trial from his. At Reyes' trial, though, his lawyers acknowledged that he did backdate stock options, but said it was done in full view of the company's finance department.

On Wednesday, the judge called Reyes' statements in the declaration "seriously misleading" and an obstruction of justice because they suggested Reyes would provide exculpatory evidence for Jensen when, in fact, he could not.

"The court must have truthful information in order for it to be just," Breyer said evenly.

Reyes' attorney, Richard Marmaro, attempted to take the flak for the declaration, telling Breyer he had been the "proponent" of it, along with Jensen's attorney, Keker & Van Nest partner Jan Little.

The language in the declaration was a product of "poor drafting by the lawyers" and was not meant to apply to all of the disputed Brocade stock option grants, said Marmaro, a partner at Skadden, Arps, Slate, Meagher & Flom. "

When does the statute of limitations start to run on a legal malpractice case in Pennsylvania.  Hinshwaw reports on this issue.

"The Pennsylvania Superior Court held that the statute of limitations for a legal malpractice claim begins to run when the malpractice is committed and is only tolled until the plaintiff should reasonably have found out about some degree of injury. The statute is not tolled until all of a plaintiff’s damages are clear or until appellate proceedings in the underlying case within the legal malpractice case are over.

Under the court’s application of the occurrence rule, the trigger for the accrual of a legal malpractice action is not the realization of actual or ultimate loss, but the occurrence of a breach of duty plus some degree of apparent harm. Thus, the court concluded that the statute of limitations for a breach of a contract claim starts when the duty is breached and is only tolled until the plaintiff should reasonably have found out about the injury. Otherwise put, and applying this reasoning to the instant matter, the court found that Wachovia or its predecessor in interest, Meridian, should have reasonably been aware of the alleged breach on or about October 20, 1994, the date Pisani initiated proceedings for liquidated damages (which, of course, had to be defended at considerable cost). Consequently, the present case was time-barred even though no final judgment determining the ultimate and actual loss had been determined before the statute began to run.

In coming to this conclusion, the court noted that its ruling may require an injured client to pursue two legal actions with competing interests at the same time—the appeal of the underlying case and the malpractice claim. The court concluded, however, that the overriding public policy concern is that stale claims not be filed. "

Here is a case from New Jersey which gives a full explanation of "judicial estoppel" and its application to legal malpractice.  Generally, the issue comes up when a client agrees to a settlement, which it later finds to be inadequate.  The legal malpractice case which follows is defended, in part, by the assertion that the client settled the case, said they were satisfied, and now change their mind.

"Judicial estoppel is an equitable doctrine that protects the integrity of the judicial process. Cummings v. Bahr, 295 N.J. Super. 374, 387 (App. Div. 1996). It "preclud[es] a party from asserting a position in a case that contradicts or is inconsistent with a position previously asserted by the party in the case or a related legal proceeding." Tamburelli Prop. Ass'n v. Borough of Cresskill, 308 N.J. Super. 326, 335 (App. Div. 1998) (citation omitted).


Judicial estoppel does not prevent litigants from pleading alternative positions; rather, it "is designed to prevent litigants from playing fast and loose with the courts." Newell v. Hudson, 376 N.J. Super. 29, 38 (App. Div. 2005) (citation omitted). "[A] party must successfully assert a position in order to be estopped from asserting a contrary position in future proceedings." Cummings, supra, 295 N.J. Super. at 386. Prior success does not necessarily mean that the party benefited from the position taken, but only that a court allowed them to maintain that position and relied on it to make a judicial determination. Id. at 387.


New Jersey "has a longstanding policy that encourages settlements." Ziegelheim v. Apollo, 128 N.J. 250, 263 (1992). However, our policy favoring settlements and the doctrine of judicial estoppel only bar a litigant from subsequently disputing the fairness and reasonableness of a settlement where the litigant was fully aware of all of the facts and was reasonably advised as to the legal remedies available based on those facts. Newell, supra, 376 N.J. Super. at 33; Puder v. Buechel, 183 N.J. 428, 437-39 (2005).


The motion judge relied on Newell to apply the doctrine of judicial estoppel in this case. The issue in Newell, was "whether a litigant who either lied, or later claimed she lied, about her understanding and voluntary acceptance of the terms of her property settlement agreement, in order to induce the court to accept and incorporate it into a judgment of divorce, is judicially estopped from asserting a [counter]claim for malpractice against her matrimonial attorney based on the settlement." Newell, supra, 376 N.J. Super. at 30. At the time of the divorce hearing, Hudson represented in court that she understood and voluntarily consented to the terms of the property settlement agreement. Id. at 32. Based upon this testimony, the judge approved the settlement and incorporated the agreement into the judgment of divorce. Ibid.


Thereafter, the wife sought a modification of the alimony amount, claiming that her former husband's salary was misstated in the agreement as a result of her attorney's negligence and, as a consequence, she received an insufficient alimony award. Id. at 32-33. That motion was denied by the Family Part judge. Id. at 33.


Hudson failed to pay the divorce attorney's fee and a collection suit was instituted against Hudson. Ibid. Hudson counterclaimed alleging malpractice. Id. at 33-34. In responding to questions posed at her deposition, Hudson essentially testified that her sworn testimony to the judge hearing the divorce proceeding was false. Id. at 34. The attorneys then filed a motion for summary judgment. Ibid. In dismissing the malpractice action on the basis of judicial estoppel, the motion judge found that the wife was not misled by her attorney because she testified under oath that she knew what she was doing. Id. at 36. The judge also stressed that the wife, who was an accountant, although not tutored in the law, was nevertheless a sophisticated individual who had received sufficient factual information to inform her decision regarding the settlement. Id. at 35-36.


In reviewing the grant of summary judgment, we noted that the Ziegelheim and Puder


courts recognized legal malpractice as a viable cause of action where a matrimonial attorney's negligent pretrial preparation and advice led to the recommendation of an improper settlement. By declining to apply a per se bar, these cases preserve a malpractice claim of a vulnerable litigant who unknowingly enters into an inadequate settlement, believing it is fair, as a result of the arguable negligence of her matrimonial attorney. 

We agreed that a legal malpractice action was reserved for "vulnerable litigant[s] who unknowingly enter[] into an inadequate settlement, believing it is fair, as a result of the arguable negligence of [their] . . . attorney." Ibid. Further, we adopted the position of the Idaho Supreme Court, stating that judicial estoppel


should only be applied when the party maintaining the inconsistent position did have, or was chargeable with, full knowledge of the attendant facts prior to adopting the initial position. . . . [T]he concept of judicial estoppel takes into account not only what a party states under oath in open court, but also what that party knew, or should have known, at the time the original position was adopted. [Ibid. (quoting McKay v. Owens, 937 P.2d 1222 (1997)).]

Failure to diagnose breast cancer...it's a horrible thing.  When we think of a family member who could have been saved, who dies because of medical negligence, where a simple mammogram or simply reading it correctly could have made a difference...

Here, after a death, the medical malpractice case was bungled, and a legal malpractice case finally led to a verdict against the attorney who didn't sue the doctor.

"A Hinds County jury returned a $375,000 judgment Tuesday in a legal malpractice case.
Varnado and attorney Robin Blair, also of Hattiesburg, represented the sister of a Sunflower County woman who died of breast cancer in 1999.

The woman filed a lawsuit against Jackson lawyer Isaac Byrd Jr. and his firm and lawyer Howard Bowen, who initially handled the case.

Barbara Butler said in the lawsuit heard in Hinds County Circuit Court that her sister, Jacqueline Farmer, 59, died in June 1999 after not getting a mammogram in eight years despite going to her regular physician during a portion of that time.

Butler initially went to Bowen to have a lawsuit filed against the doctor, who worked at a clinic in Indianola. Bowen turned the case over to Byrd in October 1999, according to Blair.

Blair said Byrd requested and received Farmer's medical records but didn't file the lawsuit until 2001, a year after the statute of limitations to file such a lawsuit expired.

But Byrd's attorney, Felecia Perkins of Jackson, said the medical malpractice lawsuit was filed in Sunflower County and the presiding judge never ruled the statute of limitations had expired prior to the case" being filed.

Today, we reach 1500 articles on Legal Malpractice.

We would like to thank our readers for persevering with us through server breakdowns, slow story days, and our exploration of the legal malpractice world.

Experts are generally, but not always necessary in legal malpractice cases.  The test is whether a fact-finder can rely upon its own knowledge.  Here is an interesting case, Frances Northrop, respondent, v Eric Ole Thorsen, appellant. (Index No. 5684/04) ,2007-00973 ,
SUPREME COURT OF NEW YORK, APPELLATE DIVISION, SECOND DEPARTMENT ,
2007 NY Slip Op 10124; 2007 N.Y. App. Div. LEXIS 12903 , decided 12/18/07.


"In an action to recover damages for legal malpractice, a plaintiff must demonstrate that the attorney failed to exercise the ordinary reasonable skill and knowledge commonly possessed by a member of the legal profession and that the attorney's breach of this duty proximately caused plaintiff to sustain actual and ascertainable damages. To establish causation, a plaintiff must show that he or she would have prevailed in the underlying action or would not have incurred any damages, but for the lawyer's negligence. Expert testimony is normally needed to establish that the attorney failed to exercise the ordinary reasonable skill and knowledge commonly possessed by a member of the legal profession, unless the ordinary experience of the fact-finder provides sufficient basis for judging the adequacy of the professional service, or the attorney's conduct falls below any standard of due care."

The case is interesting for two other points:  plaintiff won even after being precluded from using expert testimony; and plaintiff avoided a "mitigatino of damages" defense. "In support of his affirmative defense that the plaintiff failed to mitigate her damages, the defendant contends that the plaintiff herself could have avoided termination of her workers' compensation benefits by making an application for nunc pro tunc judicial approval of the settlement. HN3The defendant, however, "may not shift to the client the legal responsibility [he] was specifically hired to undertake because of [his] superior knowledge"

RECENT CASES IN LEGAL MALPRACTICE


1. CHICAGO TITLE INSURANCE COMPANY, Plaintiff, v BARBARA J. MAZULA, Defendant and Third-Party Plaintiff-Appellant; JAMES E. KEABLE, Third-Party Defendant-Respondent.


SUPREME COURT OF NEW YORK, APPELLATE DIVISION, THIRD DEPARTMENT

2008 NY Slip Op 27
January 3, 2008

This is a case in which the question becomes whether an individual or an estate hired the attorney. In order for plaintiff to prevail, the court must determine that the estate hired the attorney, and each of the mistakes took place while the attorney represented the estate, not the individual.

“ Defendant argues that the toll applies because the sale of the property was not an isolated transaction, but an estate matter during which Keable continued [**4] to represent defendant's husband's estate long after the malpractice accrued. We disagree. The first deed attempted to convey what was believed to be the estate's interest in the property whereas the second deed conveyed defendant's personal interest. Regardless of how the first deed was executed, defendant, as a surviving tenant by the entirety, solely conveyed her personal interest (see Matter of Mischler, 30 AD3d 859, 860, 819 N.Y.S.2d 118 [2006]). Hence, as to both deeds, Supreme Court correctly determined that Keable was always acting for defendant in her individual capacity, not in her capacity as the executor of her husband's estate 2. Since Keable performed no further work for [*3] defendant, either personally or in her capacity as executor of the estate after January 2000 in regard to this transaction, the commencement of this third-party action for legal malpractice was not timely.”


2. Gerald Goldman, et al., Plaintiffs-Appellants, v Akin Gump Strauss Hauer & Feld, LLP, et al., Defendants-Respondents.

SUPREME COURT OF NEW YORK, APPELLATE DIVISION, FIRST DEPARTMENT
2007 NY Slip Op 10492
December 27, 2007



In many legal malpractice cases, we find that the attorneys played several roles. Sometimes, they start as transactional attorneys, and morph into litigation attorneys.

Here the “documentary evidence [that] effectively precludes plaintiffs from arguing that defendants' representation in the arbitrations was continuous with their representation in the sale. Such documentary evidence consists of the affidavit submitted by plaintiffs in a prior litigation that involved an unsuccessful attempt by a limited partner to disqualify defendants from representing plaintiffs in one of the arbitrations. Therein, one of the plaintiffs stated that while defendants were retained to advise plaintiffs and, if need be, serve as their litigation counsel, in connection with litigation then being threatened by the limited partners, as to the sale itself, defendants were retained only to draw the documents necessary to consummate a deal that had already been negotiated and agreed to. Holding plaintiffs to this position (see D & L Holdings v Goldman Co., 287 AD2d 65, 71-72, 734 N.Y.S.2d 25 [2001], lv denied 97 NY2d 611, 742 N.Y.S.2d 604, 769 N.E.2d 351 [2002]), defendants' [**3] representation in the arbitrations, which involved the merits of the litigation that was being threatened by the limited partners at the time plaintiffs retained [*2] defendants, was distinct from their representation in "papering" the sale, which did not involve negotiating the terms of the sale or advising whether or not to proceed with it.”

Attorneys and clients enter into contingent fee retainer agreements, which do not directly address the question of an appeal.  Is the legal fee for an appeal the responsibility of the client or the attorney in this situation?  Here is a case from Madison/St.Clair which discusses this question:

"A legal malpractice claim filed by Donel Johnson claims Belleville attorneys Jodee Favre and Laura Allen breached their fiduciary duty and appropriated fees greater than they were entitled to in a wrongful termination claim he filed in 1998.

According to Johnson's suit filed in St. Clair County Circuit Court on Dec. 21, 2007, he entered into a contingency fee agreement with Favre and Allen on April 9, 1998.

Johnson, a tank washer with Rogers Cartage Co., was fired in 1998 after he refused to dump chloronitrobenzene into the sewer, the suit claims. In 2001, a St. Clair County jury awarded Johnson $2.13 million plus costs. Defendants Rogers and Tankstar appealed, and in 2002, a settlement was reached in which Johnson would receive $800,000 in cash and an annuity at a cost and present value of $439,022.

Johnson claims he was damaged in that his annuity is owned by his former employer and it does not guarantee payment to him and his heirs.

"Plaintiff has been further damaged in that Plaintiff paid Defendants in excess of $334,000 more than they were entitled to pursuant to their fee agreement with Plaintiff," the complaint states.

Johnson also claims that his contract with Favre and Allen entitled them to one-third of any sum he recovered.

"Because this agreement did not specifically exclude the handling of an appeal, Defendants Favre and Allen were deemed to have agreed to include any and all appellate work regarding Plaintiff's claim," the complaint states. "

It's winter, and our thoughts turn to the Caribbean.  Here, a Philadelphia law firm, 1400 lawyers strong, gave commercial advice pertaining to the Cuban embargo, and are now defendants in a legal malpractice case.  Here is the story from Bloomberg, via the Caribbean news agency.

"NEW YORK, USA (Bloomberg): Morgan, Lewis & Bockius, the largest Philadelphia-based law firm with 1,400 attorneys, gave advice regarding sales to Cuba under the US trade embargo that led to a criminal investigation, a lawyer for an ex-client has argued.

Dan and Stefan Brodie, the founders of Purolite Corp., a manufacturer of specialty resins for water purifiers based outside Philadelphia, sued Morgan Lewis in 2004 for legal malpractice. The case began in the early nineties when an accountant questioned a sale by Purolite's Canadian subsidiary to a company in Cuba. Purolite claims Morgan Lewis attorneys repeatedly advised them that the sales were legal because there was no US involvement.

"Morgan Lewis's malpractice, sloppy work and their bad advice cost Purolite and the Brodies and it cost them severely," said Marc Kasowitz, a lawyer for the brothers, in opening arguments on Friday in state court in Philadelphia.

In 1996, the US Customs Service began an investigation into Purolite's sales to Cuba. Morgan Lewis told the inspectors that the company's foreign subsidiaries were separately owned and advised the Brodies to continue doing deals with the Cuban company, leading to a criminal indictment by the US Attorney's office in Philadelphia, Kasowitz said.

In 2002, the Brodies were convicted of making illegal trades to Cuba, a verdict that was later reversed on appeal. The Brodies and Purolite pleaded guilty to charges concerning reimbursement of travel expenses, the company said in court filings.

A lawyer for Morgan Lewis said the firm advised the company not to sell to Cuba and that Purolite continued to do so because they wanted the money. "

The question of pre-judgment interest in legal malpractice has not been widely understood .  Generally, it was thought that an award of pre-judgment interest was determined on the same basis as in the underlying case.  Contract damages, yes.  Pain and suffereing, no.

However, this case indicates that the real inquiry is whether there should be pre-judgment interest calculated from a hypothetical judgment which the plaintiff should have obtained, had there been no malpractice.  Such a hypothetical judgment, years prior to the legal malpractice case, may allow for interest from that date, at 9% per annum!

Barnett v. Schwartz, 2007 NY Slip Op 09712, Appellate Division, Second Department, Decided 12/11/07  stands for a somewhat novel principal. Prejudgment interest appears to be permitted in legal malpractice, whether it would have been permitted in the underlying case or not. This wide sweeping pronouncement appears to apply not only to recognized breach of contract causes of action, but to personal injury legal malpractice damages, too.

“CPLR 5001 operates to permit an award of prejudgment interest from the date of the accrual of the malpractice action in actions seeking damages for attorney malpractice”, citing Horstmann v, Grasso PC, 210 AD2d 671; Rudolf v. Shayne, Dachs, Stanisci, Corker & Sauer, 8 NY3d 444 (2007)

This is a seminal, important case which will, we predict, be widely cited and discussed in Legal Malpractice.   Barnett v. Schwartz, 2007 NY Slip Op. 09712, 2d Dept, December 11, 2007 is important for several reasons. We’ll discuss the first here

“But for” causation is not as difficult as had previously been believed.

Does the failure to exercise” that degree of care, skill and diligence commonly possessed and exercised by members of the legal community.” have to be “the” proximate cause of damages? Must it be “a” proximate cause of damages?

The Appellate Division says that it must be nether “the” or “a” proximate cause of action, but simply requires proof that “but for” the negligence of the defendant-attorney, the plaintiff-client would have prevailed in the underlying action.”

This formulation does not require a greater, more direct degree of causation, and the Appellate Division did not find a “substantive import to the variations in the formulations discussed above, holding that a plaintiff-client in a legal malpractice action need prove only that the defendant-attorney’s negligence was a proximate cause of damages.”

“But for” causation is not synonymous with sole proximate cause, and it is not required that the degree of causation in legal malpractice be any greater than “proximate cause. i.e., greater than that which must be typically proved as against any other professional or lay defendant in a negligence action. There is no case which singles out attorneys for “special treatment on causation.”

Here is an article from Hinshaw which tells us that  "A law firm may represent itself and may pursue not only contract or quasi-contract but also tort theories in suing a former client, at least as long as the amount sought in damages does not exceed the amount of unpaid legal fees"

"Law firm Pedersen and Houpt provided a variety of legal services to Summit Real Estate Group, LLC (Summit) including successfully litigating a breach of contract claim. Soon thereafter Summit’s assets were transferred to another entity, Main Street West, and Summit was dissolved. The two members of Summit were 50 percent owners of Main Street West. Id. Pedersen and Houpt brought suit to recover attorney’s fees naming five closely related defendants including Summit and Main Street West.

Pedersen and Houpt sued on multiple causes of action including breach of contract, quantum meruit and account stated. However, given Summit’s insolvency, Pedersen and Houpt’s best chance at recovery was through more far-reaching legal theories such as piercing the corporate veil and unjust enrichment. Defendants argued that these more far reaching legal theories were “an attempt to create new liabilities beyond the scope of [Pedersen and Houpt’s] contractual relationship with its clients.” Id at 8. Defendants consequently asserted that any use of confidential information to pursue these “new liabilities” was beyond the scope of Illinois RPC 1.6(c), which provides: “[a] lawyer may use or reveal * * * (3) confidences or secrets necessary to establish or collect the lawyer’s fee.” Id.

The trial court agreed with the defendants’ argument and granted a motion to compel Pedersen and Houpt to seek outside counsel. Reviewing this decision on an abuse of discretion standard, the court of appeals reversed, noting that the plaintiff’s legal theories were within the scope of RPC 1.6(c)(3) and that requiring Pedersen and Houpt to seek outside counsel did not resolve or even address the issue of the scope of RPC 1.6(c)(3).

The appellate court’s reasoning was based on the premise that limiting the legal theories available under RPC 1.6(c)(3) would reward fraudulent behavior by clients and would not serve any reasonable client expectation or legitimate purpose. The appellate court also noted that the damages sought by Pedersen and Houpt were limited under all theories to the amount of legal fees owed. Consequently, Pedersen and Houpt was not attempting to profit improperly from its former attorney-client relationships "

This story from LA is about a failed City of LA law suit over an underground gas main construction project.  The action was filed late, and dismissed.  Now the city attorney is a defendant.

"A jury will decide if the former attorney for the city of Vernon committed legal malpractice and if he should pay more than $1 million in damages.

The city sued Eduardo Olivo in April 2005, alleging that he mishandled various litigation involving the city. One allegation stems from Olivo's decisions involving work done by contractor Kenko in the installation of an underground gas main.

The city alleged the work was defective and that Olivo did not act quickly enough to sue Kenko. When the city did eventually file a complaint against the firm, it was dropped because it was lodged after the statute of limitations had expired. "

In this New Hampshjre newspaper report, a city attorney is now a defendant in legal malpractice.

"CLAREMONT - The City of Claremont has filed a lawsuit alleging malpractice and negligence on the part of then-city solicitor John J. Yazinski for his role in the dismissal of former city tax assessor Steve Snelling in September 2000. The suit was filed in Sullivan County Superior Court late last week.  It alleges Yazinski, now a Claremont District Court judge, acted in "derogation of his duty and in violation of the applicable standard of care," and that he "failed to reasonably advise the city in this regard."

"Shortly after his firing, Snelling asked for a hearing before the Claremont Personnel Advisory Board, during which Yazinski and his partner Daniel G. Smith of Hughes, Smith, and Yazinski, LLP of Claremont were present in an advisory role to the city. The city said that although Snelling informed the board that night he intended to file suit, "the law firm failed to notify the city that Snelling had given notice of his intention to sue and failed to give notice of the threat of suit to the insurance carrier providing coverage to the city at the time or to recommend to the city that such a notice be given."

As a result, "the insurance carrier to which the city had paid insurance premiums at all times material would not provide coverage to the city for the Snelling suit because no notice had been provided of Snelling's intention to sue during the applicable policy period."

Snelling filed suit against the city in 2003, claiming his termination was a violation of his First Amendment free speech rights. Snelling won his case, which was upheld by the state Supreme Court following appeal. A second trial to examine damages is set to begin in March.

Specifically, the suit alleges "legal malpractice" against Yazinski, and the same allegation against the firm. In the suit against Yazinski, the city said that "had Yazinski provided the advice required by the standard of care under these circumstances, Snelling would not have been terminated. "

While, generally, patent law depends on Federal Law, and provides federal question jurisdiction in Federal District Court for patent legal malpractice cases, here is an interesting state court appellate decision from Colorado.  Bristol v. Osman, Court of Appeals, Colorado.  It involves patent laches, and the statute of limiations in legal malpractice.  It also involves 6 amended complaints, the last four of which were submitted in contravention of the rules, and without any motion seeking leave.

Small towns have communities that notice small events.  Here is an example:  a lawfirm throws out old files, and they mistakenly sit on the curb, awaiting the garbage truck.  The local news station finds out, and puts this story on their website.

"A call to the Channel 2 News Tipline asked why open boxes with files were out on the curb in front of a law firm in Orchard Park. Channel 2 News then found some of those same open boxes.

The boxes were on the curb of South Buffalo Street in front of the Berkowitz and Pace Law Firm. One of the open boxes had a visible file labeled "Medical Malpractice" with a name and phone number visible.

Attorney Leonard Berkowitz told us they were remodeling their office and that's why the boxes were thrown out that way. Berkowitz was asked if he felt there could be confidential records or information in the boxes. "These are old boxes. We thought they were going to be picked up immediately. They probably should have been shredded. We're gonna take 'em back in now based upon what you said. It was a mistake and they should have been shredded."

Law.Com reports on this Venable Legal malpractice case:

"In 2004, Venable partner Stefan Tucker's former client Alan Weinberger sued him for malpractice. The claim stemmed from a prior suit between Weinberger and another of Tucker's ex-clients, Lev Volftsun. After years of this messy legal spat, the 4th U.S. Circuit Court of Appeals affirmed that Weinberger had no case late last month. But it seems Tucker hasn't shaken his ex-client just yet: Weinberger has confirmed plans to file a motion this week for a new hearing before the entire court.

Tucker first introduced his two clients in 2000. Weinberger needed investors for his company TechNet, so Tucker helped Volftsun negotiate an agreement to loan TechNet $250,000 and to become a company board member. In 2001, Weinberger created a holding company into which he merged TechNet and another company, ASCII. Volftsun sought repayment of the loan. The company did not repay him, and Volftsun consequently sued in the U.S. District Court for the Eastern District of Virginia.

Weinberger appealed in September, only to have the lower court's decision affirmed by a three-judge panel on Dec. 20, but that decision clearly has not discouraged him. "

McNight v. Public Defender is  recently decided New Jersey Legal Malpractice Case.   We started a discussion yesterday.

Today, let's look at the court's description of the three approaches to criminal defense legal malpractice cases.

1.  Need for Actual Innocence:  NY is among these jurisdictions.  One must demonstrate a reversal, or an exoneration, which starts the statute of limitations running.

2.  No Need for Actual Innocence:  Plaintiff''s s/l starts running on the date of the malpractice.

3. A two tiered approach.  The NJ solution is that a post-conviction process in criminal court must be started, and the legal malpractice must be simultaneously started, but the legal malpractice case should be stayed.

The 55 page decision is well worth reading for the many nuances set forth.

NY Lawyer [and Law.Com] report that a Texas business owner has sued Weil Gotshal & Manges over its handling of a Texas credit union acquisition.

"Dallas businessman has sued Weil, Gotshal & Manges, alleging that the firm and two of its partners took advantage of him as a client by lessening his interest in a deal while he was undergoing treatment for cancer.

In David M. Radman, et al. v. Richard M. Boyd, et al., Radman -- individually and as trustee of the DMR Trust -- and CU Commercial Services LLC allege that the firm and two of its Dallas partners, Michael A. Saslaw and Robert C. Feldman, conspired with Radman's then-business partner and others to reduce Radman's interest in a proposed acquisition of a Dallas-based credit union subsidiary.

In his Dec. 12 petition filed in the 160th District Court in Dallas, Radman also names as defendants his business partner, Richard M. Boyd; Dallas-based Texans Credit Union; TCU's president and CEO, David Addison; Texans Commercial Capital LLC; and Credit Union Liquidity Services LLC.

Radman's petition also alleges the following against Weil, Saslaw and Feldman: breach of contract, breach of fiduciary duty, fraud, negligent misrepresentation, professional malpractice, violation of the Texas Deceptive Trade Practices Act, conversion, tortious interference with existing and prospective contracts and civil conspiracy to commit harm. "

Legal malpractice cases against the criminal defense attorney are confusing.  In addition to all the other elements, in NY one must prove actual innocence or exoneration.  When the statute begins to run [date of malpractice, date of last representation, date of final judgment, date that post-conviction motion decided, reversal or exoneration] is a difficult call. 

McNight  v. Office of Public Defender.  This NJ case is remarkable for several reasons.  The first is a discussion of how an attorney, "on a busy Wednesday plea day" simply forgot to ask his client whether he was a US citizen and how a misdemeanor conviction would impact him.  Here, it led to a deportation order, and when Trinidad would not take him back, imprisonment without end.

The second reason is the legal aid attorney's willingness to admit his wrong.  Sometimes, it seems that criminal defense attorneys are much more willing than other attorneys to admit they made a mistake, if it helps the client get a new trial or get his plea back.

For us, the most important reason is the compelling discussion of the state's different positions on how to handle a criminal defense legal malpractice case.  More tomorrow.

Here is a well-written decision by NY Supreme Court Justice Stallman on a very complicated question of attorney-client privilege, confidentiality, issues of whether there was an attorney-client relationship, and how to resolve the competing rights of discovery, business secrets and confidentiality. 

Hélie v McDermott, Will & Emery ,2007 NY Slip Op 27523 ,Decided on December 17, 2007 ,Supreme Court, New York County ,Stallman, J.

"In this legal malpractice action, plaintiff Marc Helie claims that defendant John J. Sullivan, a partner in the law firm of defendant McDermott, Will & Emery, failed to disclose an alleged conflict of interest while Sullivan was allegedly representing plaintiff and acting as outside corporate counsel to Gramercy Advisors, LLC and related entities. Plaintiff alleges that, in June 1998, Sullivan represented him in connection with the formation of Gramercy Advisors, LLC and related entities. In January 2000, non-party Jay Johnston purchased a 30.43% interest in the business, which resulted in amendments to Gramercy's original operating agreement. Plaintiff alleges that, during the drafting of those amendments, Sullivan allegedly advised plaintiff that, in the event of plaintiff's resignation, his resignation would not be considered "an event of dissociation" under the operating agreement, which would trigger a payment based on a specified formula. Plaintiff alleges that Sullivan advised plaintiff that his interest in Gramercy upon resignation would reflect current market value. Plaintiff claims that, on the basis of that advice, Helie executed the revised operating agreement. Plaintiff claims that, during the drafting process and in rendering the alleged advice, Sullivan was acting as plaintiff's attorney. "

Read the balance of the decision for Justice Stallman's discussion of the competing rights of the litigants.

In this NY Lawyer's blurb, we see th outcome of a new variety of legal malpractice action:  a sort of secondary liability suit in a transactional setting.

"A New York appeals court has thrown out a lawsuit against Seward & Kissel over the law firm's representation of failed hedge fund Wood River Partners.

A group of institutional investors had charged that the law firm shared blame for an alleged fraudulent scheme in which investors were misled about the fund's holdings, 60 percent of which turned out to be in one small technology company named EndWave Corp. That company's stock collapsed in July 2005, triggering the investors' claimed $200 million in losses.

But the Appellate Division, First Department, ruled yesterday in Eurycleia Partners v. Seward & Kissel, 600704/06, that the law firm's preparation of Wood River's offering memo did not constitute a representation, fraudulent or otherwise, to the investors.

The court noted that Seward & Kissel's work for the fund was focused on the fund's formation and its taxes and not its investment strategy. The appellate panel also found that the investors had no relationship with Seward & Kissel as Wood River's counsel that would impose a duty on the firm to investors.

The court dismissed claims against Wood River's auditor, American Express Business & Tax Services, on similar grounds. "

The simple answer to this question is, Yes!

Delaware is the state of choice for many corporations, and it is said that there are more attorneys in Manhattan giving advice on Delaware corporate law than there are in Delaware.  Now Sheri Qualters of the NYLJ reports that the Delaware  Court of Chancery has ruled that non-Delaware attorneys are subject to suit there.

"A recent Delaware Court of Chancery ruling that non-Delaware attorneys and law firms can be sued in the state for their advice to Delaware-incorporated companies has raised concerns about courts' jurisdictional reach and about a lawyer's duty to challenge a client's business decisions.

The case is of concern to law firms, investment banks and others who advise companies on Delaware issues, said Barry Sher, the chairman of the litigation practice in the New York office of Paul, Hastings, Janofsky & Walker.

"With relatively minimal actual contact with the state of Delaware in the normal jurisdictional sense, they could nonetheless be brought into court," Mr. Sher said.

Since many U.S. companies are chartered in Delaware and subject to Delaware corporation law, Delaware Court of Chancery decisions have had a major impact on corporate law.

The recent case involves allegations that Baker Hostetler and a Columbus, Ohio-based corporate partner, Joseph Boeckman, aided and abetted the breach of fiduciary duty committed by three managers of Lima, Ohio-based bronze ball bearings maker Randall Bearings Inc. Sample v. Morgan, No. 1214-VCS (New Castle Co., Del., Ch.).

According to court papers, the managers and their lawyer allegedly orchestrated a scheme to entrench and enrich themselves by buying a large block of voting stock from the company at an unfairly low price. "

This is abattle between a major celebrity dancer and a football player's ex-trophy wife, in which she claimed the dancer raped her.  She hires attorney who starts law suit against dancer.  End result ?  Attorney and ex-wife accused of extortion, attorney pays substantial settlement to dancer, ex-wife has an $11 million verdict against her.

"A woman who accused Michael Flatley of sexual assault has been ordered to pay him more than $11 million for making false allegations to extort money from him, according to documents obtained Monday.

Superior Court Judge Michael L. Stern found that real estate agent Tyna Marie Robertson had defamed and intentionally inflicted emotional distress upon Flatley, 49, who appeared in "Riverdance," "Lord of the Dance," "Feet of Flames" and "Celtic Tiger."

Robertson had alleged Flatley raped her in a Las Vegas hotel in 2002 and threatened to sue unless he agreed to pay a "seven figures" settlement, according to court papers.

Police declined to press criminal charges, and Flatley said the sex was consensual.

Robertson then filed a $33 million lawsuit in Illinois alleging sexual assault, but it was dismissed.

Flatley countered with a lawsuit against Robertson and her lawyer D. Dean Mauro claiming extortion, intentional infliction of emotional distress and defamation.

The California Supreme Court held in July 2006 that Mauro had committed extortion, and he settled the case by making "a substantial payment" to Flatley, according to a statement from the dancer's lawyer, Ricardo P. Cestero. "

Examiner.com reports that in Maryland, discipline numbers are small and decreasing, while legal malpractice cases are increasing.

"The vast majority of Maryland lawyers never get into trouble.

In fact, the number of lawyers sanctioned by the state has fallen in the past 10 years, with the biggest drop happening in the latest fiscal year — when only 57 of the state’s 33,018 lawyers were disciplined by being disbarred, suspended or reprimanded.

Data and reports from Maryland’s disciplinary agency, the Attorney Grievance Commission, show that less than a quarter of all complaints are investigated, nearly half of those investigated complaints are “closed administratively” and about a third of the remaining receive some kind of discipline.

What the data do not show is any information on cases dismissed by the commission, with or without an investigation. All complaints are considered private and confidential unless the commission brings charges against an attorney. All charges are public. .

While lawyer punishments are declining, the number of attorney malpractice lawsuits, in which lawyers are sued, is increasing at the same rate as the expansion of the bar, said Dave Whitworth, a Crofton attorney who has practiced for 30 years.

The number of people who want to sue their lawyers has increased, said Stacie Dubnow, a legal malpractice attorney from Hunt Valley. But she has not seen an increase in the number of cases that merit a lawsuit.

We don't know the rule in Montana, but in NY one may not successfully sue his criminal defense attorney without showing actual innocence.  Here is a case from Montana of an exonerated criminal defenendant who wants to sue his attorney, now decesed.  There are of course, many hurdles.  Is there insurance for a public defender?  is there still an estate for the deceased attorney?  Is there a public defender agency?

"A man exonerated of rape charges after 15 years in prison claims in a federal lawsuit seeking damages that he was poorly represented at trial, by a now-deceased court-appointed defender.

Jimmy Ray Bromgard, whose conviction was overturned in 2002, is suing the state of Montana and Yellowstone County for $16.5 million. In depositions reviewed by the Billings Gazette, Bromgard claims his court-appointed attorney, John Adams, advised him to "plead guilty" the first time they met, then mounted a shoddy defense and bungled his appeal.

The public defender program was funded by the county. County attorneys have argued state judges were largely responsible for its operations, the Gazette reported.

Yellowstone County recently made a final offer to Bromgard in an attempt to settle the lawsuit, deputy county attorney Dan Schwarz told the newspaper. Schwarz would not provide further details except to say the offer is open until the end of the year.

The state has filed motions to be dismissed from the case, but they have not yet been ruled on by U.S. Magistrate Judge Carolyn Ostby. That part of the case is expected to focus on allegations of incompetent forensics work by the State Crime Lab and its former director, Arnold Melnikoff. "

Here is a case from California in which plaintiff's attorney came into possession of a set of notes made by defendant's attorney concerning the expert and his testimony.  Even though the notes inadvertently came into plaintiff's possession, the attorney has been taken off the case by the court.

If things go wrong from here, will there be a legal malpractice case to follow?

"Taking advantage of an opposing lawyer's privileged documents, even if they're accidentally obtained, is a major no-no, the California Supreme Court ruled Thursday.

To drive its point home in the anxiously awaited ethics case, the court unanimously upheld El Segundo, Calif., lawyer Raymond Johnson's disqualification from an automobile rollover case for using his opponent's notes to impeach expert witnesses.

"An attorney in these circumstances may not read a document any more closely than is necessary to ascertain that it is privileged," Justice Carol Corrigan wrote. "Once it becomes apparent that the content is privileged, counsel must immediately notify opposing counsel and try to resolve the situation."

Johnson represented a family who sued Mitsubishi Motors Corp., Mitsubishi Motor Sales of America and the California Department of Transportation following the 1998 rollover crash of a Mitsubishi Montero sport utility vehicle. Eleven-year-old Denise Rico died in the accident and her 18-year-old sister, Zerlene, was partially paralyzed.

Before the case reached trial, Johnson came into the possession of opposing attorney James Yukevich's notes concerning a meeting with expert witnesses. Johnson copied the 12-page document, prepared by one of Yukevich's paralegals, and used it during a subsequent deposition to discredit Yukevich's experts.

Johnson claims the notes were given to him accidentally by a court reporter, while Yukevich insists they were illicitly taken from his co-counsel's briefcase during an earlier deposition.

San Bernardino County Superior Court Judge Ben Kayashima eventually ruled that Johnson obtained the document inadvertently. But he still disqualified Johnson and his legal team from the case for breaching his ethical duties by using another lawyer's confidential work product. "

Here is an interesting take on the issues of electronic discovery, its blossoming, and future legal malpractice cases.  In short, learn and the new rules, or face problems.

"Much ink has been spilled about the demands of discovery in the current technological age. The storage of electronic data, the existence of metadata and the wholesale migration from printed hard copy documents to electronic documents have challenged all practitioners, particularly those trained in discovery during the era of banker's boxes and hard copy documents. The 2006 e-discovery amendments to the Federal Rules of Civil Procedure, along with other standard-setting rules, have raised the stakes. In fact, in the current climate, given the interplay between ethical obligations and standards for professional conduct and these e-discovery requirements, attorneys may be surprised to learn that inattention to e-discovery may not only work to the detriment of clients -- it may lead to professional malpractice or the imposition of sanctions on counsel. If any doubt remained, the ongoing discovery dispute in the Qualcomm v. Broadcom case, discussed below, should eliminate

Despite the low standard, failure to provide competent representation nevertheless creates the potential for malpractice actions. Restatement, supra § 48 (2000). In legal malpractice actions, the client must establish that, but for the attorney's neglect, the litigation would have ended in a result more favorable for the client. That is, the client must prove the existence of a duty, a breach of that duty, proximate cause and damage. 4 Ronald E. Mallen & Jeffrey M. Smith, Legal Malpractice § 30:5 (2007 ed.).

Thus, in general, an attorney owes a duty of care to clients to "exercise the competence and diligence normally exercised by lawyers in similar circumstances." Restatement, supra § 16 (2000). "

A while ago we reported on one of two class action expense [really over-expense] legal malpractice cases.  Now, this Phen-Fen case has surfaced.

"A former fen-phen client of Fleming & Associates has sued the Houston-based firm and partner George Fleming, alleging they took too much expense money out of her fen-phen settlement, including a share of $29 million for echocardiograms performed on prospective clients.

Plaintiff Sandra Karnes, who hired Fleming & Associates to seek damages from pharmaceutical company Wyeth for heart-valve injury she allegedly sustained after taking the diet-drug combination known as fen-phen, seeks class certification in the suit filed in the U.S. District Court for the Southern District of Texas.

Late last month, U.S. District Judge Ewing Werlein of Houston denied the defendants' motion for summary judgment. No hearing is yet scheduled on the class certification motion.

The allegations in Karnes, et al. v. Fleming, et al. are interesting, because Karnes filed her complaint shortly before an arbitration panel ordered Houston lawyer John M. O'Quinn's firm to pay more than $41 million to a class of 3,450 former breast implant clients "

Thanks to William Voorhees, an attorney in NJ who forwarded this story about a NJ legal malpractice case.  The case is Adelman v. Shenker, Superior Court of New Jersey, Appellate Division, A-3233-04T1, Decided 12/14/07.

Defendant attorney had sleep apnea, and after extensive pre-trial activity, had to tell the judge that he just could not go ahead with the trial, for his lack of sleep. anxiety, and other symptoms.  More interesting however, was the use of a sleep apnea specialist in this legal malpractice case. 

Ultimately, the case turned around a pre-trial mediation session, its recommendation, the lack of communication by attorney to plaintiff [then the defendant] client, and its repercussions.

When is Pre-judgment Interest permissible in Legal Malpractice cases?  The Second Department recently wrote on this issue in Barnett v Schwartz ,2007 NY Slip Op 09712 ,Decided on December 11, 2007 ,Appellate Division, Second Department ,Ritter, J., J

"The plaintiffs are entitled to an award of prejudgment interest. "CPLR 5001 operates to permit an award of prejudgment interest from the date of accrual of the malpractice action in actions seeking damages for attorney malpractice" (Horstmann v Nicholas J. Grasso, P.C., 210 AD2d 671; see also Rudolf v Shayne, Dachs, Stanisci, Corker & Sauer, 8 NY3d at 444 n 3; Meyer v Glynn, 278 AD2d 291; Butler v Brown, 180 AD2d 406). In relevant part, CPLR 5001(b) provides: "[I]nterest shall be computed from the earliest ascertainable date the cause of action existed, except that interest upon damages incurred thereafter shall be computed from the date incurred. Where such damages were incurred at various times, interest shall be computed upon each item from the date it was incurred or upon all of the damages from a single reasonable intermediate date." Here, the earliest ascertainable date that the plaintiffs' legal malpractice cause of action existed is December 21, 1992, the date that the agreement was entered into (see McCoy v Feinman, 99 NY2d 295; Town of Wallkill v Rosenstein, 40 AD3d 972). Thus, interest is to be computed from the dates that the damages were incurred (i.e., the dates that the plaintiffs paid the amounts awarded as damages for rent, renovations, and legal fees) or, if impractical, from a single reasonable intermediate date. "

One unique element in legal malpractice is the "but for" requirement... that "but for" the legal malpractice there would have been a different or better result.  Defendants in legal malpractice are eager to flaunt this requirement, and argue that the legal malpractice must be the "sole" cause of the injury.

The Second Department now clarifies in Barnett v Schwartz ,2007 NY Slip Op 09712 ,Decided on December 11, 2007 ,Appellate Division, Second Department ,Ritter, J., J

"The defendants' argument concerning causation has an impact upon the analysis of other issues raised. Thus, it will be discussed first.

The defendants argue that the Supreme Court erred when it charged the jury that the plaintiffs needed to prove only that the defendants' negligence was a proximate cause (i.e., a "substantial" cause) of damages. Rather, they assert, the court should have charged the jury, as they requested, that the plaintiffs needed to prove that "but for" such negligence they would not have sustained damages. The defendants argue that the "less rigorous standard" of causation charged by the Supreme Court warrants reversal and a new trial. However, this argument lacks merit.

The elements to be proved in a legal malpractice action have been subjected to various formulations. Thus, while it is clear that a plaintiff-client must prove negligence (i.e., that the defendant-attorney failed to exercise that degree of care, skill, and diligence commonly possessed and exercised by members of the legal community), some cases hold that the negligence must be "the" proximate cause of damages (Britt v Legal Aid Soc., 95 NY2d 443, 446; see e.g. Kleeman v Rheingold, 81 NY2d 270; Caruso, Caruso & Branda, P.C. v Hirsch, 41 AD3d 407; Cohen v Wallace & Minchenberg, 39 AD3d 691; Cummings v Donovan, 36 AD3d 648; Kotzian v McCarthy, 36 AD3d 863), while others hold that it must be "a" proximate cause of damages (Bauza v Livington, 40 AD3d 791, 793; see e.g. Moran v McCarthy, Safrath & Carbone, P.C., 31 AD3d 725; Terio v Spodek, 25 AD3d 781; Pistilli v Gandin, 10 AD3d 353). There are also cases from this court requiring the damages to be a "direct result" of the negligence (Caruso, Caruso & Branda, P.C. v Hirsch, 41 AD3d 407, 409; Kotzian v McCarthy, 36 AD3d 863; Moran v McCarthy, Safrath & Carbone, P.C., 31 AD3d 725). In the main, the cases from the Court of Appeals, including the most recent, do not expressly require that the negligence be either "the" or "a" proximate cause of damages, but require proof that, "but for" the negligence of the defendant-attorney, the plaintiff-client would have prevailed in the underlying action (in a classic lawsuit-within-a-lawsuit scenario) or would not have incurred damages (in an action alleging negligent advice, etc.) (see e.g., Leder v Spiegel, 9 NY3d 836; Rudolf v Shayne, Dachs, Stanisci, Corker & Sauer, 8 NY3d 438; AmBase Corp. v Davis Polk & Wardwell, 8 NY3d 428; Davis v Klein, 88 NY2d 1008; Carmel v Lunney, 70 NY2d 169). The defendants here, while not expressly describing the difference between proximate and "but for" causation, argue that the latter requires a greater, more direct degree of causation. However, we find no substantive import to the variations in the formulations discussed above, and hold that a plaintiff-client in a legal malpractice action need prove only that the defendant-attorney's negligence was a proximate cause of damages.

First, the parties have not cited, and research has not revealed, any case from the Court of Appeals or any other court expressly holding that "but for" causation is synonymous with sole proximate cause, or that requires a degree of causation in legal malpractice cases greater than proximate cause, i.e., greater than that which must be typically proved as against any other professional or lay defendant in a negligence action. Similarly, the parties have not cited, and research has not revealed, any case discussing or identifying any basis for singling out attorneys for special treatment on the issue of causation. The Pattern Jury Instruction on legal malpractice, which focuses upon the lawsuit-within-a-lawsuit scenario, does not expressly use either the phrase "but for" or "proximate cause" in its formulation (NY PJI 2:152). However, the comments to the instruction, while noting the "but for" formulation, provide that a defendant-attorney's negligence need only be [*5]"a" proximate cause of damages and refer the reader to the general Pattern Jury Instruction on proximate cause (NY PJI 2:152, p 872, 880; NY PJI 2:70). Moreover, our reading of the case law does not reveal that a heightened standard for causation is actually being applied in legal malpractice cases. Rather, all results can be explained by application of general principles of proximate cause. For example, in the lawsuit-within-a-lawsuit scenario, the plaintiff-client must prove that but for the defendant-attorney's negligence they would have prevailed in the underlying action. Stated otherwise, if the plaintiff-client cannot prove that it would have prevailed in the underlying action, the defendant-attorney's negligence was not a proximate cause of any damages arising from the loss of the same. Further, there are several decisions from this court requiring the plaintiff-client to prove both that the defendant-attorney's negligence was "a" proximate cause of damages, and that "but for" such negligence it would have prevailed in the underlying action or would not have incurred damages (see e.g. Moran v McCarthy, Safrath & Carbone, P.C., 31 AD3d 725; Terio v Spodek, 25 AD3d 781). Clearly, these decisions do not provide for two different measures of causation in the same standard. Indeed, it would appear that the "but for" language, which grew out of the lawsuit-within-a-lawsuit scenario (see Carmel v Lunney, 70 NY2d 169; N. A. Kerson Co. v Shayne, Dachs, Weiss, Kolbrenner, Levy & Levine, 45 NY2d 730), is merely a recognition of the factual particularities of proving proximate cause and damages in such an action. When applied in a case involving negligent legal advice (i.e., a case where there is no underlying cause of action to lose), it would appear that the "but for" formulation is merely a recognition of the factual complexities that may attend proving proximate cause when the legal advice was merely one of a myriad of factors that contributed to the plaintiff-client's ultimate decision or course of action (see e.g. AmBase Corp. v Davis Polk & Wardwell, 8 NY3d 428). Finally, we note, a conclusion that the "but for" formulation of causation requires proof that the negligence of the defendant-attorney was the sole proximate cause of damages is contrary to the holding of the Court of Appeals that the contributory negligence of the plaintiff-client may be pleaded as an affirmative defense (see Arnav Indus. Inc. Retirement Trust v Brown, Raysman, Millstein, Felder & Steiner, 96 NY2d 300; see also Boudreau v Ivanov, 154 AD2d 638). In sum, regardless of the formulation employed, a plaintiff in a legal malpractice action need prove only that the defendant-attorney's negligence was a proximate cause of damages.

Plaintiff  in this Long Island Legal Malpractice case was a company that wanted to create and bottle barbecue sauce. They looked for a site, and unfortunately came up with a building on a hazardous waste site.  However, only the attorneys knew of this small problem, and they did not let the clients know.

"RITTER, J.:  The issue to be decided on this appeal is whether the defendants-attorneys committed legal malpractice in their representation of the plaintiffs in the negotiation and closing of a lease and purchase option agreement concerning certain commercial property. The plaintiffs sought the property for the purpose of manufacturing barbecue sauce. Approximately two years prior to the signing of the agreement, the subject property was classified as an inactive hazardous waste disposal site. The defendants knew that there were [*2]environmental violations concerning the property that had to be dealt with and wrote to the relevant enforcement agencies asking for details. Despite the fact that those letters were never responded to, the defendants advised the plaintiffs to enter into the agreement at issue on an "as is" basis. The defendants never informed the plaintiffs of the environmental violations or the consequence of the "as is" clause of the agreement until two years later. We find the jury's determination that the plaintiffs were entitled to such information before entering into the agreement, and that the defendants committed malpractice by failing to advise the plaintiffs about the violations and the effect of the "as is" clause, was reached on a fair interpretation of the evidence. "

What does an Ohio legal malpractice case teach us in New York?  This case illustrates the "but for" aspect of legal malpractice.  While it is not a different burden than showing "proximate cause" in other litigation [we'll be talking about a 2d Department case in the coming days that illustrates this principal] it is always important.

"Joanne Schneider, 66, and her husband, Alan, 64, of North Royalton, sold at least $60 million worth of promissory notes to 740 investors. They used the money to buy an apartment complex, a pair of wineries, a machine shop and more than 20 rental properties.

Fornshell liquidated about $20 million of the properties, including the couple's failed Cornerstone development on 34 acres in Parma Heights.

The Schneiders are scheduled to stand trial May 19 in Common Pleas Court on charges of engaging in a pattern of corrupt activity, theft, money laundering and conspiracy.

Judge David Matia threw out the legal malpractice lawsuit after determining Roetzel & Andress had sufficiently warned the Schneiders of the consequences of defying the state's orders to stop selling promissory notes.

"The Schneiders created the implosion of the Cornerstone project through their own allegedly criminal conduct," Matia wrote in his opinion. "The Schneiders . . . defied the Ohio Division of Securities' explicit order to stop selling promissory notes . . . despite legal advice from Roetzel & Andress to the contrary."

Joanne Schneider was more aware of her dire financial situation than her lawyers, and bore more responsibility for her failure than anyone else, Matia said.

The plaintiffs argued that Roetzel & Andress could have prevented the collapse, but ignored the Schneiders' questionable fund-raising activities in order to preserve the firm's lucrative business arrangement. "

Here is the case , Laddcap Value Partners LP v. Lowenstein Sandler PC, 600973-2007
Decided: December 5, 2007 ,Justice Carol Robinson Edmead ,NEW YORK COUNTY
Supreme Court
Counsel for Plaintiff: Danzig Fishman & Decea
Counsel for defendant: Arkin Kaplan & Rice LLP

We reported on this abusive practices/gender sarcasm case last week. 

"I am "not aware of any rule or law which requires civility between counsel" (Thomas B. Decea, Esq.).

The genesis of this application is a claim of contumacious, abusive, and strident conduct by counsel during a deposition.

Michelle Rice, Esq. ("Rice"), moves pursuant to CPLR 3104 for a Court-appointed referee to supervise further depositions in this case and for an order directing that further depositions be held at the courthouse. Rice represents the defendant/third-party plaintiff, Lowenstein Sandler PC ("Lowenstein LP"), against claims of legal malpractice by plaintiff Laddcap Value Partners, LP ("Laddcap Partners").

On October 1, 3 and 4, 2007, Rice took the deposition of plaintiff's representative, Robert B. Ladd (the "witness"), who, along with Laddcap Value Associates ("Laddcap Associates"), are third-party defendants in this action. The witness is the sole employee of both plaintiff Laddcap Partners and Laddcap Associates. The witness was represented by Mr. Thomas B. Decea ("Decea").

Rice's motion is precipitated by the behavior of Decea during the three days of depositions of the witness. Rice points out that during the course of the witness's deposition, Decea repeatedly directed the witness not to answer certain questions posed to him, which were, on many occasions, followed by inappropriate, insulting, and derogatory remarks against Rice concerning her gender, marital status, and competence. Although both counsel agreed that all objections, except those as to form, were preserved, Decea made numerous speaking objections, and threatened to leave the deposition in response to such "leading" questions. Rice also contends that Decea asked her several times, off the record, whether she was married.

In light of the above, Rice argues that Decea's conduct was intended to intimidate her and interfere with her ability to zealously defend and conduct further depositions, in violation of New York's Code of Professional Responsibility, EC 7-37, DR 1-102 [A][6], New York Executive Law §296((1)(d), Rules of the Chief Judge of New York §25.16, and Uniform Rules for the Conduct of Depositions. Because of Decea's tactics and his demonstrated inability or unwillingness to comply with rules governing professional conduct, the Court should exercise its discretion under CPLR 3104(a) and appoint a special referee to ensure that the depositions are completed in a timely and cost-effective manner.

In opposition, Decea maintains that while he "aspires to be civil" to other counsel, he is "not aware of any rule or law which requires civility between counsel." According to Decea, that Rice was intimidated by him was "unfortunate" and does not substantiate any improper actions on his part. Decea complains that Rice was antagonistic toward him and the witness, was sarcastic with her questions, and harassing with her facial expressions. When Rice threatened to file a complaint against him with the Court, Decea asked to speak with her privately, whereupon both parties shook hands in agreement that if she refrained from asking leading and compound questions and badgering the witness, he would try not to interrupt her and limit his objections. According to Decea, "There was never another word about it for the rest of the week." When Rice threatened to contact the Court during the first day of depositions, Decea offered to arrange a conference call. However, Rice then declined, and continued the deposition. Now, on the eve of producing her client for a deposition, Rice "plays the gender card." Decea claims he instructed the witness not to answer approximately four times, and on each occasion, stated the basis for his objection an proffered a proper question. Decea contends that his references to "hun" and "girl" were not malicious, and if Rice would have advised him that she was offended, he would have stopped. If Rice was truly offended, she would not have completed three days of depositions. Rice's motion is a delay tactic to permit her client to assess the plaintiff's testimony and justify the fact that Rice is unavailable to for the deposition of her client scheduled for the following week. Decea intends to move for costs and sanctions."

This case from Washington state, Schmidt v. Coogan, illustrates two common situations in legal malpractice.  The first is on the lawyer's side.  Client slips and falls on spilled shampoo in a store.  She goes to the attorney, who happily takes the case.  He tells the client that it's a good case, and he will give it his all.  Client checks in and tries to make sure that everything is going well. 

On the last day of the statute of limitations she finds out that the attorney has not filed, and isn't even in the office.  Someone else hastily drafts a complaint and files it.  Problems?  Wrong defendant, wrong facts.  Motion to amend is denied.  Case dismissed.

The second situation is proving that the client would have succeeded when the legal malpractice case is brought.  Here, attorney defendants won't settle, case goes to trial.  Verdict for plaintiff, Motion for a directed verdict denied.  New trial on damages, as jury was "inflamed."

After all this, the intermediate appellate court reverses and directs verdict for attorney on theory that plaintiff could not prove notice of defective condition to the store.  Now, on the same facts,  Supreme Court of Washington reverses again, and enters judgment for plaintiff.

Lawyers handle cases for people who are sometimes desperate.  While it may little matter whether a large corporations loses a million dollars in a deal, many times an attorney deals with much more dire circumstances for the client.  They may have lost a life's savings; children may suffer.

This tragic story involves an attorney who overspent, and could not keep up.  His solution was to steal from the escrow account.  The victims have lost $ 750,000.  The attorney shot himself, after the FBI became involved.

The insurer has successfully disclaimed coverage.  The many victims, including the attorney's wife and children are not so lucky. "A legal malpractice insurer has no duty to defend or indemnify a Cumberland County, Pa., lawyer who allegedly stole more than $780,000 from his clients and gambled much of it away before committing suicide when he learned that he was under investigation, a federal judge has ruled.

As U.S. District Judge John E. Jones III described it in his 38-page opinion in Westport Insurance Corp. v. Hanft & Knight, the case involved "the tragic circumstances that resulted from a lawyer's double life."

Here is a scholarly article on Canadian legal malpractice trends from the Practice Pro blog site.  Its conclusion is that wills & estates legal malpractice cases are on the rise, and will continue this trend. 

Risk managers look to frequency and severity in their analysis of trends.  Frequency is the raw number of cases.  Severity is the potential dollar amount of the losses.  As estates [and the wills that create them] benefit from the prior years of real estate and stock appreciation, claims concerning malpractice in their handling will rise in severity, simply as a matter of inflation and appreciation.

Beyond that, the frequency is also rising.  Historically, education on the issues of legal malpractice in a specific area and publicity of successful cases contributes to this trend.

Everyone knows that oil drilling is a cutthroat buisness. Here is an interesting story.  Did the law firm capitilize on inside knoweldge?  Plaintiff's story is that it is in the niche business of developing old oil wells, and was in the process of buying from another business in bankruptcy.  They had to hire a W.Va. law firm to complete the transaction.  They charge that the law firm simply saw an opportunity, set up a rival purchaser, dragged their feet and inserted the rival into the deal.

"Between May 25 and June 2, Hinkle says it learned that Elk River Energy was formed only two weeks before the May 25 meeting and that Dollison, a partner at Bowles Rice, "was not only the organizing attorney," but "he also had a financial stake in Elk River Energy."

Had Hinkle known of what it called this "absolutely inexcusable conflict of interest," it never would have retained Bowles Rice nor would it have disclosed confidential and proprietary information consisting of the terms of the agreement with Buffalo.

On June 2, 2006, Chincheck informed Hinkle - "in a transparent attempt to excuse her culpability," according to the complaint - that she would no longer being representing the company.

Three days later -- through current counsel Hugo N. Gerstl of Monterey, Calif. - spoke with Buffalo's bankruptcy trustee, who said Elk River was trying to back out of its contract with Buffalo and trying to dissolve. Meanwhile, the trustee also moved to sell the subject property in bankruptcy court. The "Objection or Upset Bid" date was set for June 14, 2006. "

Anthony Lin of the NYLJ today reports a recent decision of Justice Edmead of Supreme Court, New York County. It is either an appalling story of gender bias and all around smarmy behavior or some simple transcriptional errors.  Was it "hon" or "hun."  Calling the adversary Attilla the Hun [as the attorney claimed] might even be good.  Here is the story:

"A New York judge has ordered court supervision of a lawyer for "objectionable conduct" toward a female opposing counsel who he said had a "cute little thing going on" during a deposition.

According to transcripts of the deposition, Thomas B. Decea of Danzig Fishman & Decea in White Plains also called Michelle A. Rice of Arkin Kaplan & Rice "hon" and "girl" and asked her why she was not wearing a wedding ring. The judge said Mr. Decea's behavior reflected gender bias as well as "a lack of civility, good manners and common courtesy." She said the appointment of a referee was a means of "guarding against future objectionable conduct" by Mr. Decea.

But Mr. Decea yesterday denied acting inappropriately. He vowed to appeal Justice Edmead's decision and said many of his comments were wrongly transcribed or taken out of context. He also accused the judge of violating his right to due process by not providing him with copies of the deposition transcripts on which she based her order.

The underlying case is a legal malpractice suit filed by a hedge fund against its former law firm. Mr. Decea, 48, was the lawyer for hedge fund Laddcap Value and its manager, Robert B. Ladd; Ms. Rice, 46, was representing the fund's former firm, Lowenstein Sandler of Roseland, N.J. This is not a white collar interview that you're sitting here interviewing something with your cute little thing going on," Mr. Decea said, according to the transcript, later telling her it was "nothing personal, dear."

After Ms. Rice told Mr. Decea she thought his comments were indeed personal and offensive, he said: "Your skin is getting thin now."

At another point in the deposition, Mr. Decea referred to Ms. Rice as "hon." After she questioned his use of the term, Mr. Ladd jumped in to suggest that Mr. Decea had meant Hun "[a]s in Attila" and that the remark was not personal.

"As in Attila? I don't even understand that," Ms. Rice replied.

Later in the deposition, Mr. Decea questioned Ms. Rice's ability to try the case.

"You better get somebody else here to try this case, otherwise you're going to be one sorry girl," he said. "

This case is instructive on several levels.  First, it is one of a coming wave of lgal malpractice cases against defense attorneys in civil litigation.  Second, it demonstrates the NJ "net opinion" rule, in which an expert must give more than a "personal opinion."  The expert must give a standard of care, and must reference stautues, cases and events in the case.  CARBIS SALES, INC., d/b/a
CARBIS LADDERS, and SAFE STEP REINSURANCE, INC., Plaintiffs-Respondents v. ISRAEL N. EISENBERG, ESQ., and POST & SCHELL, P.C., formerly known as THE LAW OFFICES OF
STANLEY P. STAHL,

This opinion vindicates Prof. Bennet Wasserman, the expert.  He also happens to be a practitioner in NJ legal malpractice cases.  Finally, the case illustrates both how badly the defense attorney bungled the matter [a big product liability case which should have been won by defense ends in a $ 1 million verdict, and then afterwards, how badly the defense of the legal malpractice matter foundered.  They were late in making motions, and late in asking for discovery.

"In this legal malpractice action, defendants Israel N. Eisenberg and his former law firm, Post & Schell, P.C., appeal from a final judgment awarding their former clients, plaintiffs Carbis Sales, Inc. (Carbis or plaintiff) and Safe Step Reinsurance, Inc. (Safe Step) $704,405.20 in damages. On appeal, defendants contend that the trial court erred in admitting the net opinion of plaintiffs' expert and in refusing them discovery of a memo prepared by an investigator retained by plaintiffs. Plaintiffs cross-appeal, arguing that the trial court erred in denying them a new trial on damages or additur."

William Gwire, a San Francisco Attorney writes in Law.Com about some of his legal malpractice cases in this article.

"The landscape for litigating attorneys has changed dramatically over the 33 years that I've been in practice. Cases are more complex, stakes are higher, and competition is more intense. Judges and opposing counsel are less accommodating and the rules and procedures that line the litigation process like a gauntlet are more complicated than ever. Clients, big and small, are also more demanding and more willing to seek redress for mistakes they perceive their attorneys have made.

But the nature of malpractice claims has also changed, with differences that often depend on the size of the firm. Interestingly, big firms and small firms, including solo practitioners, make different kinds of mistakes. While there are many types of errors that can lead to malpractice claims, this article focuses on just a few that I've seen emerging.

LARGE-FIRM MISTAKES

Complex and high-stakes litigation has placed a premium on experienced litigators, resulting in increased demand for large-firm partners with marquee names. Nothing draws in business and clients with litigation matters like a reputation for success in the courtroom. But because partners with star-power litigation credentials are in such demand, they run the risk of taking on too much work and stretching themselves too thin when it comes to handling their caseloads.

SMALL-FIRM MISTAKES

While small law firms make mistakes that usually don't add up to dollar damages as big as the ones made by larger firms, the resulting damage to both the client and the small firm or solo practitioner can be much more devastating. That is because the firm's client -- whether an individual or a small business -- may be financially unable to withstand a bad result, and the damages arising out of the malpractice may exceed the firm's insurance coverage (assuming there is any), exposing the individual partner or partners to personal liability.

While mistakes in small firms can occur in a lot of ways, there is one in particular that appears to be more prevalent today. Surprisingly, it is not the classic missed-statute type of malpractice, although that certainly still happens. The advent of sophisticated and inexpensive computerized calendaring programs seems to have eliminated many of those types of errors.

Rather, I've noticed that small firms and solo practitioners are often taking on work that they don't know how to handle. Unlike the situation at large firms, where experienced lawyers run the risk of stretching themselves too thin, the problem with small offices is lack of experience in a particular field. The law has become so complex and fields of practice so specialized that a solo practitioner or small firm simply can't do it all or even some of it. I am both amused and shocked when I see Web sites by solo practitioners or small firms that announce their specialties in family law, personal injury, probate, criminal law, intellectual property, real estate, construction litigation, securities, immigration and medical malpractice. You think I'm kidding? Spend an hour surfing the Internet for lawyers and you'll understand what I'm talking about. "

This law firm is the subject of a billboard advertising campaign. 

"A former client of Damon & Morey LLP is publicly airing complaints about the law firm.

The charges can be found on a Web site, in e-mails, on a since-removed Niagara Falls Boulevard billboard and in flyers being passed out around town.

Daniel Elia alleges that the Buffalo-based law firm is guilty of legal malpractice because it did not disclose a conflict of interest when Damon & Morey represented both him, as a debtor, and one of his creditors in a Chapter 11 bankruptcy case. The former owner of the now-defunct D.A. Elia Construction Corp. in Niagara Falls also claims that the firm charged him "unreasonable" legal fees.

"We think this type of conduct is not good for our community and not good for the integrity of the legal system," said Elia, who has outlined his grievances on the Web site www.damon-moreymisconduct.com.

Damon & Morey's managing partner, Peter Marlette, said the courts found the conflicts of interest to be "insignificant." "

In this California Case, the court discusses the minimum showing of economic loss necessary. "A dentist being sued for dental malpractice has alleged none of the economic losses usually associated with claims for the breach of an insurance contract, bad faith or legal malpractice, a California appeals panel held Nov. 19, finding that a trial court properly sustained an insurer's demurrers without leave to amend "

On a totally different issue, this case makes facinating reading.  Plaintiff, a dentist is sued for dental malpractice.  His insurer hires attorney firm 1 to whom he objects.  One of the bases is that their expert worked for the patient-plaintiff's attorneys previously.  He complains to the carrier and they replace the attorneys with firm 2.  Firm 2 previously defended firm 1 in legal malpractice and the dentist complains... and on it goes.  The dentist eventually wins the dental malpractice case.  Read the decision.

Here is a report of a Texas case which raises a novel argument:  In a bench trial is it necessary to present expert evidence of legal malpractice?  The argument is that evidence of a deviation from good and accepted practice must be shown to a jury, whose knoweldge generaly is insufficient for them to decide without expert testimony.  A judge who is finding the facts is in  a different situation, and it is often said that expert testmony on legal issues may not be presented to a judge. 

As an example, in a legal malpractice case arising from a non-filed appeal, it is the court's decision, not a jury's whether there would have been a different outcome.  Expert testimony on that aspect of the case is not permitted.

Is this the same argument?  In Texas, the answer was no.  "In Abdelhak v. Farney, plaintiff brought claims of legal malpractice and violations of the Texas Deceptive Trade Practices Act against his former trial attorney. No. 04-07-00121-CV, 2007 WL 4180133, at *1 (Tex. App.—San Antonio Nov. 28, 2007, no pet. h.) (mem. op.). Plaintiff alleged the defendant lawyer committed malpractice by failing to call certain witnesses, elicit certain testimony, and thoroughly conduct a cross-examination, but plaintiff failed to designate an expert witness prior to the designation deadline. Plaintiff sought leave to make a late designation and argued that his claims did not require expert testimony, but the trial court granted summary judgment. The San Antonio court affirmed. Id. at *4-5.

It is well-established that expert testimony is required to prove causation in legal malpractice cases arising from alleged trial errors because "the wisdom and consequences of these kinds of tactical choices" are beyond the knowledge of most jurors. Id. at *4 (quoting Alexander v. Turtur & Assocs., 146 S.W.3d 113, 119-20 (Tex 2004)). But this case had been set for a bench trial. The plaintiff argued that expert testimony should not be required in bench trials, because the lawyer’s negligence and the result of that negligence should be more obvious to a judge with legal training and experience. Noting that plaintiff had not provided any authority to support this argument, and observing that such a distinction would require a subjective determination of the particular trier of fact’s knowledge, the San Antonio court declined to modify the expert testimony requirement in the case of bench trials. "

It's not possible to predict how an appellate court will decide summary judgment motions.  All know the standard.  Interpretation of the arguments varies from panel to panel.

Here is a recently decided legal malpractice summary judgment and appeal . Hamilton Duffy-Duncan, Plaintiff-Respondent, v Berns & Castro, et al., Defendants-Appellants.

2235, 27619/03 SUPREME COURT OF NEW YORK, APPELLATE DIVISION, FIRST DEPARTMENT
2007 NY Slip Op 9493; 

The salient facts are a slip and fall on a patch of ice on an elevated outdoor subway platform.  The attorney failed to serve a timely notice of claim.  Here, the AD determined that defendants had not demonstrated that a storm condition would have provided a defense, or that  the TA might have defended on the issue of notice.  "The lack of discovery" here was held against the attorneys, not the plaintiff.  This is not always the case.

Reed Smith had a nice relationship with the Bair Foundation, a smaller religeous entity.  They represented the foundation for a while, and did so amicably.  However, when the foundation became a defendant in a discrimination law suit, and Reed Smith defended, the bill for legal services rose from an estimated $ 50,000 to $ 1 Million.  Now the foundation sues and says that  Biglaw is not for smaller companies or entities.

"The high demands on partners in global law firms to increase profits, the client said, ultimately led to its claims of professional negligence against Reed Smith. The religious nonprofit alleged it was excessively charged for its legal representation in a routine employment discrimination case, according to the complaint in The Bair Foundation v. Reed Smith.

And the nonprofit's attorney said he thinks these large firms shouldn't represent the smaller organizations.

The Bair Foundation, described in the complaint as a Christian charitable foundation devoted to foster care for children, sued Reed Smith in Lawrence County Common Pleas Court in Pennsylvania after it was allegedly charged nearly $1 million in legal fees and costs in defense of the suit.

This story is becoming news.  In a legal malpractice litigation,  involving the Town of Manalapan, NJ suing over a land deal by a former public official, a blogger is now being pursued for information coming onto the blog site.  Like the Flea case [read Eric Turkowitz's series of articles in   this new case has far greater considerations.

"The Electronic Frontier Foundation (EFF) asked a Superior Court judge in New Jersey today to preserve the free speech rights of an anonymous blogger facing legal threats from local government officials.

The blogger, writing as "daTruthSquad" on a site hosted on Google's Blogspot service, has criticized a controversial lawsuit filed by the township of Manalapan, as well as the officials who decided to pursue the case. The township subpoenaed Google for "daTruthSquad's" identity -- as well as for any emails, blog drafts, and other information Google has about the blogger -- claiming that the defendant in the case is actually writing the posts. The defendant, however, has already sworn under penalty of perjury that he is not "daTruthSquad."

"Bloggers, as well as everyone else, have a First Amendment right to speak anonymously," said EFF Staff Attorney Matt Zimmerman. "Litigants don't get a blank check to pry into the private lives of critics when they say things the litigants don't like. The fact that it is the government trying to abuse the discovery process makes this attempted invasion of privacy all the more repugnant."

In a motion to quash the subpoena filed today, EFF asked the court to block the township's attempt to uncover the identity of "daTruthSquad" and allow the blogger to continue to write about this or any other issue without being forced to identity him or herself. "

We're republishing a blog blurb that unfortunately did not have a link to the original case.  From what we can piece together, here is what happened.  Plaintiff undergoes back surgery and emerges blind in one eye and damaged in the other.  Plaintiff hires med mal attorney who sues on the theory of drug incompatibility.  Attorney loses case for lack of expert.

Plaintiff then sues attorney, arguing that this was a positioning case, and as he was lying on his stomach for hours, his eyes were physically not drug damaged,  Plaintiff wins $ 750,000 verdict.  Interestingly, the doctor gets in the act and sues attorney too.  He succeeds with an $ 80,000 settlement.  Question: how does the doctor successfully sue the attorney?

In NY a convicted criminal defendant may not successfully sue his criminal defense attorney...unless he is exonerated.  That, or a reversal of the conviction [the ability to demonstrate "innocence"] is necessary.  In Wisconsin, the rule is in flux.  Here is a case which discusses, without deciding, when the statute starts to run: on the date of the mistake or on the date of the exoneration.  Instead, Wisconsin borrows the Pennsylvania statute of limiations, and dismisses the case.

STATE OF WISCONSIN
IN COURT OF APPEALS
DISTRICT II
Thomas P. Jasin,  v. Michael Best & Friedrich LLP,

"PER CURIAM. Thomas P. Jasin appeals from an order dismissing his legal malpractice action against Michael Best & Friedrich (MBF). The issue is whether the cause of action is time barred under the applicable statutes of limitation. Without addressing whether Wisconsin would adopt an exoneration or two-track rule in determining when a criminal malpractice action accrues, we affirm the order of the circuit court based on the application of Pennsylvania law. " "In Pennsylvania, periods of limitation in a criminal malpractice action begin to run at the time the attorney-client relationship is terminated. Bailey v. Tucker, 621 A.2d 108, 116 (1993). Although Pennsylvania makes actual innocence an element of proof for recovery, it does not make exoneration a prerequisite to the accrual of the malpractice action and the limitation period may expire before the defendant has obtained postconviction relief. Id. at 115 n.12, 13. Jasin’s claims are time-barred under Pennsylvania law. Because we borrow Pennsylvania law regarding limitations, we need not address whether Wisconsin would adopt the exoneration or two-track rule of accrual"

When you start out reading this story, it cleaves to the age old complaint:  Lawyers are less polite, and more business oriented than in the past.  It's no longer a profession, its a business.  The shocker comes at the end of this particular story:  biglaw litigating lawyer calls Federal Judge anti-catholic !

"Manhattan federal judge has delivered a lengthy manifesto against declining civility in the legal profession in the course of sanctioning law firm Dorsey & Whitney and two of its partners.

Southern District Judge Harold Baer opened his 129-page decision with a discussion of how "naked competition and singular economic focus of the marketplace have begun to infiltrate the practice of law, subordinating the high standards of service, collegiality and professionalism as a result."
"But the lawyer targeted by the judge struck back hard.

"It is hard to take seriously Judge Baer's alleged concern for professional courtesy when he continues to treat women litigators like second class citizens in his court room, requires attorneys to physically oversee the return of documents in another country within a matter of hours when they are overseas on their anniversary, and sets depositions on Sunday mornings," said Ms. Peters in an e-mail.

"Indeed, when a Catholic lawyer asks for the opportunity to attend church before the Sunday deposition, he mocked the attorney for Catholic observance," she said. "

In New York there is no recognizable discovery rule for the statute of limitations.  For the most part, the statute starts to run on the day of the mistake, although it may be tolled for continuous representation, or fraud [which does not consist of merely hiding the malpractice], but in Delaware there is a specific rule.

Here is a case which discusses the rule and its application. Boerger v. Heiman, Superior Court of the State of Delaware. 

Mississippi seems like the wild west of litigation.  When personal injury attorneys here speak of  the Bronx with reverence, it pales in comparison.  Here is a story of big tobacco, big tobacco litigation, big law and big bribes.  This might even be a reason for senatorial resignation!

"An attorney who helped negotiate a multibillion-dollar settlement against tobacco companies in the 1990s and has sued insurers over unpaid Hurricane Katrina claims was indicted in a suspected scheme to bribe a Mississippi judge.

The indictment accuses Richard "Dickie" Scruggs of conspiring to pay the judge $50,000 to rule in his favor in a lawsuit brought by other attorneys who sought fees for work on Katrina insurance litigation.

Circuit Court Judge Henry Lackey reported the "bribery overture" to federal authorities and agreed to assist investigators in an "undercover capacity," according to the indictment.

Scruggs, whose brother-in-law is Republican U.S. Sen. Trent Lott, earned millions from asbestos litigation and from his role in brokering a multibillion-dollar settlement with tobacco companies in the mid-1990s. "

Here is a story from Kentucky.  What caught our interest was the "case so good he couldn't lose it"

"He has been called the lawyer "sued on both ends" -- losing lawsuits filed against him by his client and by the Louisville surgeon his client unsuccessfully sued.

As the Kentucky Trial Court Review put it, Tennessee attorney Laurence Dry was found on one hand to have botched a medical malpractice case "so good he couldn't lose it" and on the other hand to have filed a case "so bad he never should have taken it."

The paradoxical result is unprecedented in Kentucky, according to the presidents of both Kentucky Defense Counsel, which defends civil cases, and the Kentucky Justice Association, which represents plaintiffs

This attorney fee matter involves a huge real estate famiy fortune.  It recalls the Goldman real estate family divorce.  There the husband proudly declared that he owed his wife only $ 386 milion dollars in equitable distribution, not $ 786 million.  

 In Lawrence v. Miller the attorneys worked on this estate matter for an hourly rate which netted them $ 18 million, and at the same time asked for "gifts."  The Gifts were for $5 Million!  Afterwards, they got the widow to sign a new contingent fee arrangement for 40%.  How did the AD react to this?  They said that the fee was all right for now, and that they could not make a decision without further information.

Ex Parte interviews of Non-party doctors is the subject of todays Court of Appeals Ruling.  Read the entire case, and note the many amicus briefs.  This is a big and important case.  Put simply, Surpeme Court is permitted to direct plaintiff to give defendant HIPPA authorizations which allow defendants not only the records, but the right to speak with prior treating physicians and discuss plaintiff's medical condition.  Plaintiff is not permitted to hear the discussion, nor be supplied with notes.

Remembering the identical genesis of medical malpractice and legal malpractice, as well as the mirror image "physician-patient" and "attorney-client" privileges, a similar legal malpractice case must soon surface.  There are often several attorneys who represented plaintiff prior to the target defendant, and afterwards, too.  Right now, they may not be interviewed.  Will this last?

Law.Com via Newsday reports that Sam Wiley "the colorful Texas billionaire" has sued Milberg Weiss and other class action plaintiff's law firms for their handling of the Computer Associates class action matter.  Essentially he charges the settled too soon and for too little, in order to grab legal fees prematurely.

"Wyly’s beef? He claims that Milberg and the others left billions on the table by prematurely settling a case so they could bank some $40 million in attorneys fees. The suit was filed in state court in Manhattan and alleges legal malpractice, fraud, unjust enrichment and breach of fiduciary duty. Here’s the story from Newsday.

Newsday reports that Wyly’s lawsuit centers on two shareholder lawsuits filed against CA — one in 1998 following a sharp drop in CA’s share price, and another in 2002 following news of an accounting probe at the company. The plaintiffs law firms effectively dropped the 2002 claims, according to the story. Wyly’s lawyer, William Brewer, told Newsday that the firms’ decision to effectively drop the claims in the 2002 suit “one of the most egregious cases of [legal] malpractice I’ve seen in 23 years.”

In addition to Milberg Weiss, the suit names as defendants Stull, Stull & Brody; Schiffrin Barroway; and Coughlin Stoia. Newsday reached neither the firms nor CA for comment.

Here is a post from NY Lawyer:

In April 2003, Steven Garfinkel, the chief financial officer of DVI Inc., wrote a memo to chief executive officer Michael O'Hanlon about the crushing liquidity crisis facing the health-care finance company and its implications for a pending stock float. The CFO urged his boss to talk as soon as possible to the company's main outside lawyer, John Healy, a partner in the New York office of Clifford Chance.

As for Clifford Chance, it is now facing two lawsuits in federal court in Philadelphia charging that it participated in the fraud at the company. One is the familiar shareholder class action, which is also targeting Merrill Lynch and Deloitte & Touche. The other suit, however, is by DVI itself, or, rather, the bankruptcy trustee overseeing the fallen company's estate. Trustee Dennis J. Buckley requested $2 billion in damages from the London-based law firm in a complaint filed in March 2006.

Though they garner fewer headlines, such bankruptcy trustee suits have largely replaced shareholder class actions in the nightmares of law firm managing partners. These suits are often better-funded, better-lawyered and, with the U.S. Supreme Court likely to further limit third-party liability in securities fraud cases, they may soon have a distinct legal edge as well.

"These are the lawsuits firms are most worried about now," said Michael Carlinsky, a partner at Quinn Emanuel Urquhart Oliver & Hedges who is representing Marc S. Kirschner, the bankruptcy trustee of failed commodities brokerage Refco Inc. in a $2 billion suit against the company's former lawyers at Mayer, Brown, Rowe & Maw, among others.

Indeed, the journey of Enron Corp. law firm Vinson & Elkins illustrates the shifting landscape of law firm liability. The Houston-based firm vigorously fought the high-profile securities fraud suit brought against it by former class action king William S. Lerach, getting off scot-free with a voluntary dismissal in January 2007. But last year Vinson & Elkins quietly paid $30 million to Enron's bankruptcy trustee, who never formally filed suit against the firm.

Law Firms as Targets

While securities class actions are brought on behalf of shareholders, bankruptcy trustee suits are brought for the benefit of creditors, the biggest of which are usually banks and investment funds. These creditors have grown more aggressive about recouping losses, lawyers say, with trustees acting accordingly. "

This post is about bad lawyering.  While not legal malpractice [in the sense that it mainly involves criminal defendants who cannot sue their attorney in New York or in most jurisdictions]. it is about the US Supreme Court letting the defendant hang while excusing the poor attorney performance. 

"The U.S. Supreme Court in 1984 established new standards for assessing whether a lawyer's performance was so bad that his client's right to a fair trial was compromised.

"An accused is entitled to be assisted by an attorney, whether retained or appointed, who plays the role necessary to ensure that the trial is fair," the Court proclaimed in Strickland v. Washington, 466 U.S. 668 (1984).

Twenty-three years later, however, many experts say that the promise of Strickland has gone unfulfilled, with underpaid and overwhelmed lawyers still allowed to give indigent defendants subpar representation.

And now criminal defense lawyers fear the high court is starting to retreat from Strickland itself. On Nov. 5, it agreed to consider Arave v. Hoffman, an Idaho case that will weigh the obligation of lawyers to explain to their clients the consequences of not accepting a plea agreement. "

The Massey Coal company case in West Virginia with its sister case in Virginia was a $ 50 million verdict, with a legal malpractice case arising from a similar loss in Virginia and the failure appropriately to file an appeal.  From this post both seem doomed.

"Posted on November 22, 2007 by Jeffrey V. Mehalic 
Yesterday was the last day of the Supreme Court of Appeals of West Virginia’s Fall Term, and the Court released several opinions, including its decision in Caperton v. A.T. Massey Coal Company, Inc., No 33350. (The Westlaw opinion is not available yet, so the link is to the PDF version on the Court’s website.)

At stake was the $50 million verdict in the plaintiffs’ favor, based on the jury’s finding that A.T. Massey Coal Company, Inc. and several of its subsidiaries intentionally interfered with and destroyed Hugh Caperton’s business. With accrued interest since the verdict in 2002, the plaintiffs’ judgment had grown to approximately $76 million. Here’s my post from last month when the case was argued.

In a 3-2 decision written by Chief Justice Robin Davis, the Supreme Court reversed the verdict and remanded the case to the Circuit Court of Lincoln County with directions to enter an order dismissing with prejudice the plaintiffs’ claims against the defendants. The Court identified two grounds for the reversal. First, the circuit court should have granted the defendants’ motion to dismiss based on a forum selection clause contained in “a contract directly related to the conflict giving rise to the instant lawsuit.” Second, assuming that the circuit court’s ruling on the forum selection clause was not erroneous, the Supreme Court found that the doctrine of res judicata based on an action that had been litigated in Virginia.

The Virginia litigation to which the Court refers is the plaintiffs’ 1998 suit against a Massey subsidiary in the Circuit Court of Buchanan County, Virginia, which alleged breach of contract and breach of the duty of good faith and fair dealing. Only the breach of contract claim was considered by the jury, which returned a verdict in the plaintiffs’ favor for $6 million. That verdict resulted in Massey suing its Virginia counsel for malpractice, on the grounds that they failed to sign the notice of appeal, which resulted in the dismissal of the appeal and the affirmance of the verdict."

While it is rare, on ocassion, a client may be ordered to pay double fees in a contingent fee case. Here is an example:

Greenberg v. Cross Island Industries Inc., 05CV6026
Decided: October 16, 2007
District Judge Arthur D. Spatt

U.S. DISTRICT COURT
EASTERN DISTRICT OF NEW YORK

Alpert & Kaufman, LLP
First Attorneys for the Plaintiff

Gair, Gair, Conason, Steigman & Mackauf
Second Attorneys for the Plaintiff

Judge Spatt

"What began as a routine settlement in a personal injury action has evolved into a contentious battle between plaintiffs' previous and present counsel over the proper apportionment of legal fees. Here, however, in a somewhat unusual circumstance, the clients, rather than present counsel, are to pay the fee of previous counsel separately and in addition to the fee of present counsel

The Gair Firm asserts that Alpert & Kaufman was dismissed by the Greenbergs for cause and is not entitled to any legal fee. See Garcia v. Teitler, 443 F.3d 202, 212 (2d Cir. 2006); Friedman v. Park Cake, Inc., 34 A.D.3d 286, 287, 825 N.Y.S.2d 11, 12 (1st Dep't 2006) (stating that where an attorney is discharged for cause, she is entitled to no compensation).

 Evidence of a general dissatisfaction with an attorney's performance or a difference of opinion between attorney and client does not establish that the attorney was discharged for cause absent some evidence that the attorney failed to properly represent the client's interest. Garcia, 443 F.3d at 212; Costello v. Kiaer, 278 A.D.2d 50, 50, 717 N.Y.S.2d 560, 561 (1st Dep't 2000). Indeed, "[a]ttorney-client relationships frequently end because of personality conflicts, misunderstandings, or differences of opinion having nothing to do with any impropriety by either the client or the lawyer." Klein v. Eubank, 87 N.Y.2d 459, 663 N.E.2d 599, 640 N.Y.S.2d 443, (1996); see also D'Jamoos v. Griffith, 2006 WL 2086033, at *5 (E.D.N.Y. July 25, 2006).

Something more than a personality conflict or difference of opinion is required to establish discharge for cause and '"[c]ourts typically find a discharge for cause where there has been a significant breach of legal duty.'" D'Jamoos, 2006 WL 2086033, at *5 (quoting Allstate Ins. Co. v. Nandi, 258 F. Supp. 2d 309, 312 (S.D.N.Y. 2003)). For example, in an extreme case, the court held that plaintiff's counsel was discharged for cause where it kept hidden from its client the fact that it had allowed the statute of limitations to expire. In re Spatola, 196 Misc. 2d 666, 668, 763 N.Y.S.2d 463, 465 (Sur. Ct. Richmond Co. 2003) ("When an attorney deliberately fails to disclose to a client critical information, it weakens [the fundamental] trust and confidence and erodes the relationship to the point that the client . . . has cause to discharge the attorney."). Here, there is no evidence that the conduct of the Alpert Firm breached the trust and confidence so crucial to the attorney-client relationship.

Instead, it is more likely, that the Alpert Firm was discharged as a result of a difference of opinion on how the case ought to be conducted.The Court notes that in Vallejo v. Builders for Family Youth, 2007 WL 10386 (Sup. Ct. Kings Co. Jan. 2, 2007), the court found that because the letters to previous counsel regarding his discharge never mentioned cause and referred to the matter of his compensation, counsel was not discharged for cause. Vallejo, 2007 WL 10386, at *5; see also Realuyo v. Diaz, 2006 WL 695683, at *7 (S.D.N.Y. March 17, 2006) (finding no evidence of discharge for cause because, among other things, the client's termination letter to attorney failed to specify the reason for termination and requested an accounting of the lawyer's fee).

There is an unusual twist in the fee arrangement between the Gair Firm and the Greenbergs. In the covering letter from Anthony H. Gair to Barry F. Greenberg dated February 22, 2006 it is stated: "It is understood that you and your wife will be solely responsible for any fees awarded your out-going attorneys. We agree that we will represent you in any fee dispute with the out-going attorneys at no additional cost." In addition, the Gair Firm's retainer statement, dated March 3, 2006, filed with the Office of Court Administration states that "[a]ny fees awarded to the out-going Attorneys, Alpert & Kaufman, will be the sole responsibility of the plaintiffs." (Retainer Statement of Robert Conason (March 3, 2006)). This agreement is contrary to the usual situation, in which the prior attorney would be paid its portion from the fee received by the incoming firm, rather than by the client.

It's a trap for the unwary.  We've written about this here on the blog, in the New York Law Journal and elsewhere.

Fee determinations in legal fee disputes are determinative of a later legal malpractice case.  Let's take an example.  Attorney does horrible job, loses case for plaintiff on discovery preclusion grounds.  Let's assume it is clearly malpractice.  Attorney and client get in a dispute over fees.  Attorney claims $ 100,000 in fees.  At arbitration the award is for $ 100,   Huge negative for attorney?  Yes, but any award of fees, even one so small, necessarily determines that there can be no malpractice case, because no fee may be awarded if there is a determination of legal malpractice.

Here is an example:   Wallenstein v Cohen ,2007 NY Slip Op 09023 ,Decided on November 13, 2007 ,Appellate Division, Second Department .   We agree with the defendants that all of the allegations in the complaint were "reasonably and plainly comprehended to be within the scope of the dispute submitted to arbitration" (Altamore v Friedman, 193 AD2d 240, 247). The determination fixing the value of the defendants' services necessarily determined that there was no malpractice (see Blair v Bartlett, 75 NY 150, 154; Koppelmann v Finkelstein, 246 AD2d 365, 366; Altamore v Friedman, 193 AD2d at 246; Chisolm Ryder Co. v Sommer & Sommer, 78 AD2d 143, 145-146). Accordingly, the Supreme Court should have granted that branch of the defendants' motion which was pursuant to CPLR 3211(a)(5) to dismiss the complaint as barred by arbitration and award and by the doctrine of collateral estoppel

Burton v. Continental Cas. Co., 2007 WL 2669201 (S.D. Miss. Sept. 6, 2007).

Wiley Rein reports:

"The United States District Court for the Southern District of Mississippi, applying Mississippi law, has granted summary judgment for an insured attorney, holding that his insurer was obligated to defend the attorney where the underlying complaint alleged misconduct that occurred both before and after the retroactive date in the attorney's professional liability policy. Burton v. Continental Cas. Co., 2007 WL 2669201 (S.D. Miss. Sept. 6, 2007).

The insurer issued a duty-to-defend professional liability policy to the attorney with a retroactive date of November 26, 2001. The policy included a "Retroactive Exclusion Clause Endorsement," which provided that the grant of coverage was available only if "the act or omission occurred on or after 11/26/2001."

Former clients filed suit against the attorney in December of 2002 in connection with his representation of them in a lawsuit against a life insurance company. The underlying plaintiffs alleged that, prior to November 2001, the attorney and other associated lawyers attempted to force plaintiffs to settle their case through a settlement pursuant to which the attorney would receive a separate sum of $2.9 million. The underlying plaintiffs also alleged that the attorney refused to return the case files when asked to do so in November 2002. The insurer denied coverage and declined to defend the attorney in the underlying action. The attorney subsequently filed the instant action. The court also rejected the insurer's contention that because the allegations in question related to conduct that occurred after the underlying plaintiffs fired the attorney, any misconduct in 2002 was not in connection with provision of "legal services."

Another write up from Hinshaw:

Richard H. Milgrub v. Continental Casualty Company, 2007 WL 625039 (W.D. Pa.).

The attorney-insured in this case sold his home and represented himself, his wife and the buyers in the transaction. The buyers subsequently sued the attorney alleging breach of fiduciary duty and professional negligence. After the attorney’s professional liability insurance carrier attempted to exclude coverage based on the subject policy’s “contractual liability” exclusion, the attorney filed a declaratory judgment action for a coverage determination against the carrier. Finding that the breach of fiduciary duty allegations were not causally based on the contract transaction, the court ordered the carrier to provide coverage for them.

Richard Milgrub and his wife entered a contract on September 9, 2003 to sell their residence to Robert and Shellie Brown (the Browns). The Browns believed Milgrub was acting as the legal representative for both parties in the deal. In November 2004, the Browns sued the Milgrubs alleging: (1) fraudulent representation; (2) claims under the Pennsylvania Sellers Disclosure Act and the Unfair Trade Practices Consumer Protection Act; and (3) claims for professional negligence and breach of fiduciary duty. Milgrub reported the claim to his professional liability provider, the Continental Casualty Company (Continental). Continental denied coverage and Milgrub filed a declaratory judgment action. Both parties in that case moved for judgment on the pleadings.

"The “determinative question” for the court was whether any specific aspect of the breach of fiduciary claim was independent of an alleged conflict of interest, in which case coverage would obtain. The allegations in (1), (3) and (5) above relied on a conflict of interest arising out of the real estate contract. However, the court found that the allegations in (2) and (4) were independent of any alleged conflict based on the contract. For that reason, there would still have been coverage under the policy language covering claims if liability would have attached in the absence of the contractual agreement. The court thus held that there was no coverage for the claims arising out of the contractual obligations, but that there was for the claims arising out of the breach of fiduciary duty allegations.

From Hinshaw:  In an Illinois case where the legal malpractice complaint was dismissed, the court went too far in Visvardis v. Ferleger, ___ Ill. App. 3d ___, 873 N.E.2d 436 (1st Dist. 2007)

"Illinois’ First District Appellate Court recently held that a trial court erred when it went outside of the pleadings to grant a 735 ILCS 5/2-615 motion to dismiss plaintiff’s legal malpractice complaint. The appellate court found fault with the trial court’s having based its decision on a conclusion that plaintiff would not have won the underlying lawsuit even if defendant had not committed malpractice. The appellate court further held that plaintiff’s complaint alleged sufficient facts from which it could be inferred that the defendants in the underlying lawsuit had sufficient assets to pay damages on the date of alleged malpractice (or thereafter"

Legal Malpractice insurance is a vital component of doing business in New York.  What attorney goes to sleep comfortably without it?  Yet, carriers are always looking for a way out.  Here is an example of the latest twist in NJ from Law.Com:

"A legal malpractice carrier is taking a hard line on the level of client grumbling that puts a lawyer on notice of a potential claim that must be reported.

The carrier's declaratory judgment suit, filed Tuesday in federal court in Trenton, N.J., could cause sleepless nights for any lawyer who has ever had to deal with a client disappointed by the outcome of a case.

General Star National Ins. Co. says a lawyer's silence about a client’s displeasure over the size of a settlement offer in a wrongful-death case and her threat to consult with separate counsel was enough to void malpractice coverage.

The carrier cites language in its policy, common to legal malpractice policies, that defines a claim to include "knowledge by an insured of any event or circumstance which could reasonably be expected to result in or lead to a claim being asserted against an insured, provided that the insured gives the company written notice of such event or circumstance prior to the termination date of the policy period .  William Voorhees Jr. of Morristown, N.J., says:""The prior knowledge exclusion is the exclusion du jour of the insurance industry," he says. "The denial of claims because of the prior knowledge exclusion has increased dramatically in the past four to five years. It is working, if for no other reason than it has the factual effect of driving down the malpractice plaintiff's demand."

It centers around a Charles M. Russell statue; what could be more quintessentailly Western.  Real or Fake?  The outcome of this case is a $1 Million verdict against the attorneys and $ 9 Million in Punitive damages.  Hinshaw reports:

"Steve Morton and the international law firm that represented him had very strong, credible grounds to believe that famed artist Charles M. Russell’s signature on a painting that Morton owned was a forgery. But, represented by an “of counsel” attorney of the law firm, Morton nonetheless sued W. Steve Seltzer, an art authenticator, who had refused to recant his professional opinion that the painting was not an authentic painting by Russell. The underlying case was dismissed for lack of expert support for Morton’s position, Morton acknowledged that he could not prevail, and the law firm representing him was found to have committed discovery abuses by withholding key evidence. Seltzer subsequently sued Morton and his law firm for malicious prosecution. The Montana Supreme Court upheld a trial court judgment for $1.1 million in compensatory damages and $9.9 million in punitive damages against the firm.

Our recurring theme is that legal malpractice may pop up anywhere in the world/attorney interaction.  Here is an interesting situation we never envisioned.  What does an estate attorney do about vintage firearms?  What about that WW2 tommy gun up in the attic?

"Estate Planning for Grandpop's Gun in the Chest
Joshua Prince, a law student has written another article on NFA Firearm issues and estate planning.
To answer these and other question about Firearms and Estate Planning Please read his article Estate Planning for Grandpop's Gun in the Chest. His article deals with the requirements, benefits, and detriments of registering a weapon as an individual person, corporation , or trust. Many of the issues hold trust for Florida Gun Trusts but you should check with a Florida Gun Lawyer to verify what makes sense in your particular situation. His article begins:

As an estate attorney, how do you handle the planning of an estate, which includes National Firearms Act [NFA] firearms? What if your client asks you, prior to his/her purchase of a NFA weapon, what is the best form of ownership, with long term estate planning in mind?This issue may plague estate attorneys, leaving them to scratch their head in bewilderment as to the correct course of action. More importantly, a probate attorney may be flirting with malpractice, since the registration of NFA weapons is mandatory and ignorance is not a defense

Some states require disclosure of legal malpractice coverage [really non-coverage.]  New York does not.  California is debating the issue.  From Law.Com:

"Deciding whether to require that attorneys tell clients when they don't have malpractice insurance is proving extremely difficult for the California Bar Board of Governors.

After a confusing and contentious discussion Friday, board members unanimously punted a controversial proposed amendment back to agency staffers and the Committee on Regulation, Admissions and Discipline to discern whether it would fly legally.

The amendment would clarify when exactly lawyers would have to disclose their malpractice insurance status to clients, by linking disclosure with state Business and Professions Code §6147 and 6148. The codes require attorneys to draft written fee agreements for both contingency and non-contingency work that could cost clients more than $1,000. Exceptions include workers' compensation cases and lawyers working for government agencies.

Based on his visibly irked reaction when the Board of Governors gave the amendment conceptual approval by a narrow 10-9 vote, State Bar President Jeffrey Bleich likely hopes the amendment will eventually get a thumbs down. He huffily denounced the proposed change as "problematic," saying it could allow attorneys to "commit a fraud" by insinuating they're covered by malpractice insurance when in reality they aren't. "

From Law.Con [sorry, we reprinted the entire blurb here]:

"Pillsbury Caught In Another Bankruptcy Conflict

Perhaps Pillsbury Winthrop Shaw Pittman needs to reevaluate its system for screening conflicts and disclosing material developments that may impact bankruptcy claims. Back in March, we mentioned that Pillsbury was the subject of a motion filed by the U.S. Trustee to disqualify the firm from representing Sonic Boom and to force it to disgorge fees earned. Now, according to this article, Pillsbury has been accused of another confict. Apparently, Pillsbury failed to disclose an agreement between the firm and directors of its clients, extending the statute of limitations on a potential malpractice claim. Creditors argue that this situation should have been disclosed to the court.


The California Business Bankruptcy Blog explains the significance of the case to bankruptcy practitioners:


In the first instance, Pillsbury lost the business of representing SonicBlue in the case, and thus its presumable large revenue stream. Now, if the accusation comes to anything, Pillsbury stands to lose money in the form of damages for losses to the corporation due to the directors' actions. Yikes.

It is important for bankruptcy counsel to always bear in mind the competing constituencies involved in every bankruptcy proceeding. What may be a good idea in garden variety civil litigation, may be a devastating decision in the bankruptcy arena. Deals with clients in business litigation such as that between Pillsbury and the SonicBlue board may be perfectly reasonable in most situations, but in bankruptcy, where the interests of creditors are paramount in a debtor-in-possession situation, such a deal undermines the entire process because Pillsbury could not be expected to fully pursue claims against the board if Pillsbury was potentially on the hook for any damages by agreement. Being able to recognize hidden conflicts as well as the obvious ones is essential to a successful bankruptcy practice, as the SonicBlue representation highlights.


If there's anything else that Pillsbury hasn't revealed about this matter, now would seem to be the appropriate time, indeed, the last chance, to disclose it.

Posted by Carolyn Elefant on November 14, 2007 at 02:23 PM "

Arguments between insurers and reinsurers are a fertile area of litigation.  Important decisions on attorney-client privilege have come from these cases, and in this particular report, Federal Ins. Co. v North Am. Specialty Ins. Co. ,2007 NY Slip Op 08391 ,Decided on November 8, 2007 ,Appellate Division, First Department , the issue of privity between the attorneys defending a personal injury case and the re-insurer is discussed.

Here, there is no privity between them, and the case is dismissed.  "Plaintiff Federal Insurance Company, claiming it should have contributed only $1,000,000 to the settlement, sues individually and as subrogee of Galaxy General Contracting Corp. to recoup half of the $2,000,000 it paid as Galaxy's excess liability insurer to settle an underlying personal injury action in which Galaxy was a named defendant. In this action, Federal named as defendants Rivkin Radler, LLP and Bruce A. Bendix (collectively Rivkin), who represented Galaxy in the underlying action, asserting legal malpractice, and also Allied World Assurance Company (U.S.) Inc., formerly known as Commercial Underwriters Insurance Company (CUIC), Galaxy's primary liability insurer, asserting as against it bad faith, indemnity and legal malpractice.

Federal's fourth cause of action, against both CUIC and Rivkin, alleged legal malpractice. Without asserting a client relationship with Rivkin or alleging the existence of privity or any allegations of "near privity," Federal claimed merely that CUIC and Rivkin owed Galaxy a duty to defend. Federal further alleged that Rivkin was negligent in opposing the owners' motion for summary judgment on their indemnification claims by failing to assert antisubrogation or to apprise Federal in a timely manner that the owners had asserted such cross claims. According to [*4]the complaint, had Rivkin raised the antisubrogation rule, the court would have "limited any right of indemnity to the amount above the $1,000,000 limit of CUIC's OCP." Federal's fifth cause of action, also against CUIC and Rivkin, alleged a similar theory of liability, but as Galaxy's subrogee.

None of the determinations reached to justify denial of Rivkin's motion withstands scrutiny, and its dismissal motion should have been granted. To state a cause of action for legal malpractice, a complaint must allege the negligence of the attorney, that the negligence was a proximate cause of the loss sustained, and actual damages (Leder v Spiegel, 31 AD3d 266, 267 [2006], affd 9 NY3d 836 [2007]). In addition, "New York courts impose a strict privity requirement to claims of legal malpractice; an attorney is not liable to a third party for negligence in performing services on behalf of his client"
(Lavanant v General Acc. Ins. Co., 164 AD2d 73, 81 [1990], affd 79 NY2d 623 [1992]; see also D'Amico v First Union Natl. Bank, 285 AD2d 166, 172 [2001], lv denied 99 NY2d 501 [2002]). Thus, absent an attorney-client relationship, a cause of action for legal malpractice cannot be stated (Baystone Equities, Inc. v Handel-Harbour, 27 AD3d 231 [2006]; Linden v Moskowitz, 294 AD2d 114, 115 [2002], lv denied 99 NY2d 505 [2003]).

In the instant matter, there is no privity between Rivkin and Federal; Rivkin's duty in the Bermejo lawsuit ran only to its client, Galaxy, and not to any third party ."

The Attorney judgment rule holds that no attorney may be held liable for a strategic decision which was reasonable both objectively and subjectively. This may include choices of questions at trial, selection of experts, choices of evidence.

Here is a story from Hinshaw, of a Michigan Case: Bowman v. Gruel Mills Nims & Pylman, LLP, 2007 WL 1203580 (W.D. Mich. April 24, 2007)

"A federal district court in Michigan has held in a legal malpractice case that an attorney was precluded from obtaining summary judgment under the “attorney judgment rule” because he violated the Michigan Rules of Professional Conduct requirement that he keep his client informed of important decisions. Bowman retained attorney Gruel to seek maximum retirement benefits. Gruel consulted with an employee benefits specialist, attorney Stevenson, who advised that if Gruel sought to recover the retirement benefits by asserting causes of action under the Employee Retirement Income Security Act (ERISA), the claim would face “a number of significant obstacles.”

Gruel filed suit in state court seeking recovery solely under a state law theory of breach of contract. Knape & Vogt contended that ERISA preempted the claim. In response, Gruel contended that Bowman had been wrongfully denied benefits in violation of § 1132(a)(1)(B) of ERISA. The case was tried to the state court judge, who applied ERISA to Bowman’s claim. The judge ruled that under ERISA, the Administrative Committee’s decision to deny maximum retirement benefits was not “arbitrary and capricious.” The trial judge then applied a theory that Gruel had not raised, and ruled that Bowman was entitled to maximum retirement benefits under ERISA based on a promissory estoppel theory.

A Michigan appellate court reversed the trial court’s award of benefits, ruling that the trial court lacked subject matter jurisdiction over § 1132(a)(3) of ERISA, which was the basis for the promissory estoppel claim. Instead, the appellate court held, state courts have subject matter jurisdiction only over claims under § 1132(a)(1)(B) of ERISA, which applies to wrongful denial of benefits. The Michigan Supreme Court denied leave to appeal.

Bowman sued Gruel for legal malpractice for seeking recovery under a state law breach of contract claim rather than under ERISA, and for failing to advise him that recovery would not be sought under ERISA. Gruel moved for summary judgment based on the “attorney judgment rule” and on the grounds of causation. The court ruled that Gruel was not entitled to summary judgment under the attorney judgment rule, but that he was entitled to partial summary judgment on the ground of causation. "

This case is all about Long Island law firms and a case against Computer Associates and Kaye Scholer.  Plaintiff is reprsented by Tom Liotti, who is the defendant in a libel case we reported yesterday.  Computer Associates and its employees are represented by anlther Long island law firm, Lynn & Gartner.  Farrell Fritz rounds out the LI lineup.

Salvatore v. Kumar, 2007 NY Slip Op 08435  Case of legal malpractice dismissed  against the law firm. "The defendants Kaye Scholer and Parver correctly contend that, inasmuch as they were never retained by the plaintiffs Wright and Press, the complaint should have been dismissed insofar as asserted against them by those two plaintiffs.

Further, the defendants Kaye Scholer and Parver also correctly contend that the Supreme Court erred in denying that branch of their motion which was for leave to renew their motion to dismiss the complaint insofar as asserted against them pursuant to CPLR 3211(a)(7), based on the dismissal of the underlying causes of action alleging defamation, wrongful termination, promissory estoppel, and civil conspiracy. We agree with the contention of Kaye Scholer and Parver that dismissal of the underlying causes of action requires dismissal of the legal malpractice claim asserted against them. With the dismissal of those causes action, the plaintiff Salvatore cannot allege that "but for" Kaye Scholer's and Parver's alleged legal malpractice, Salvatore was wrongfully terminated and defamed and, therefore, cannot allege a legally cognizable injury ."

Intertwined in this stunning story are one brother stealing millions, attorneys themselves accused of theft, a defamation lawsuit and tragedy to all. 

 From the NYLJ: "Artful lies, trusting coworkers and lax bank procedures allowed the long-time bookkeeper of a Garden City law firm to loot an escrow account of more than $4.3 million over a two-and-one-half-year period, according to court documents and several interviews with the alleged embezzler's brother - a partner at the firm.

"Until his confession to no less than four members of the firm, there was never a reason presented to be suspicious," said Peter J. Galasso, 51, of Galasso Langione & Botter. "[My brother] had worked for us for almost 15 years, had from all perspectives a close and loving relationship with his two children, an intimate relationship with the members and employees of the firm, and was generously compensated for his services."

The case highlights the reality that law firms, like many businesses, may be vulnerable to theft from even trusted employees. And it draws attention to the obligation of lawyers to protect their clients' funds. Peter Galasso and his partner James Langione signed a Signature Bank escrow agreement listing them as the only authorized signators and prohibiting any cash withdrawals, wire or Internet activity. The account was also not to be linked to any other accounts, and monthly bank statements were to be mailed to the firm's Garden City offices.

However, the firm claims that Anthony Galasso, before depositing the real estate proceeds, destroyed or hid the original application. In its place, he substituted an application adding himself as a signator and forged the two partners' names.

The firm's lawsuit and the indictment claim that Anthony Galasso then siphoned money from the account. According to a press release from Ms. Rice, Mr. Galasso spent the money on private jets to Atlantic City and other casinos, on payments for a 2007 Mercedes Benz E350, and on a $16,000 stay for his family at the Ritz Carlton Hotel in New York City. Ms. Rice said Mr. Galasso also used the funds to purchase more than $200,000 worth of concert and sporting event tickets, paid his son's tuition at New York University Law School, made extensive improvements to his West Babylon home, and took his family on a Disney World vacation.

The firm claims that he was able to get the money even though Signature account manager Stephen Reinhardt knew that Anthony Galasso was not an attorney or a fiduciary.

"He was able to hide his secretive machinations by diverting bank mail to a post-office box, and then giving us fabricated, authentic-looking bank statements," Peter Galasso said, adding that the firm forwarded the statements to the client, as the accruing interest seemed to be in order with what the money would have been earning. "We would look at the statements and it seemed in line with what the interest was. He was pretty diabolical."

Read on:

Mr. Liotti said that at least some of the responsibility for the lost funds lays with principals of the firm.

"If I had that much money in an escrow account, I'd be watching it very closely, like every second," said Mr. Liotti. "The lawyers can't delegate that responsibility to anyone else."

Mr. Liotti added: "I don't care if it is your brother, you have to take a look at the accounts . . . I think a full and fair investigation is in order."

Galasso Langione has also hit Mr. Liotti with a $2 million defamation suit for the following statement that appeared in the Oct. 25 Newsday:

Anthony didn't do anything that he was not instructed to do by his superiors. Whatever he did, he did with their full knowledge and consent. Dipping into company accounts was a common practice among attorneys there. Is the Galasso firm going to say they never went to a concert or sporting event using this money? I think that's something that should be addressed.

Mr. Liotti refused to comment on the lawsuit against him.

Legal Malpractice can pop up in any number of situations, as we have said just last week.  Here is a short blurb on a big dollar legal malpractice case in California, concerning Surfing Chicks, Paul Hastings, Kat House and trademarks.

"Too many ‘Surf Chicks’?

Los Angeles-based law firm Paul Hastings, Janofsky & Walker LLP has been hit with a $30 million legal malpractice suit by a surfing-gear maker that hired it to trademark the phrase “Surf Chick.” The suit by Ventura, Calif.-based Kat House Productions claims Paul Hastings failed to register trademarks after saying it had done so. The suit, in Manhattan federal court, says Christian Dior SA was able to copy the “Surf Chick” mark because of the alleged negligence of the firm and several attorneys. “Had defendants properly applied for, and diligently prosecuted, the trademark applications, Christian Dior would not have been able to mimic and copy plaintiffs’ mark,” the complaint says. "

Hinshaw reports on Rudolf v. Shayne, Dachs, Stanisci, Corker & Sauer, 2007 WL 1213712 (N.Y. April 26, 2007)   We discussed this case last April.

"The New York Court of Appeals recently held that a client was entitled to recover attorneys’ fees and expert witness costs incurred when his attorney’s error forced him to appeal an adverse verdict and to try the case a second time. The client was entitled to recovery, notwithstanding that a successful settlement was obtained during the second trial.

While walking across a road, the client was struck and injured by an automobile whose driver was making a left turn. A traffic signal controlled the intersection in which the accident occurred. The client retained attorney Corker to sue the driver. At trial, there was conflicting testimony as to whether the client was in the crosswalk at the time of the accident. At Corker’s request, the trial court gave an instruction based on N.Y. Veh. & Traf. Law § 1151, which addresses intersections without operational traffic signals. Section 1151 provides that pedestrians have the right of way in crosswalks, but have a duty not to “suddenly leave a curb or other place of safety and walk or run into the path of a vehicle which is so close that it is impractical for the driver to yield.” A jury found the client and the driver each 50% at fault, and awarded damages of $255,000.

The client retained a new lawyer, who filed a motion to set aside the verdict on the ground that the jury should have been instructed based on N.Y. Veh. & Traf. Law § 1111, which applies to intersections controlled by traffic signals. Section 1111 provides that vehicles “must yield the right of way to other traffic lawfully within the intersection or an adjacent cross walk.” The trial court denied the motion, reasoning that the client’s initial counsel had requested an instruction based on N.Y. Veh. & Traf. Law § 1151. The appellate court reversed, ruling that the client was entitled to a new trial because instructing the jury based on § 1151 was an error, and it affected the jury’s assessment of the client’s fault.

A retrial resulted in a jury’s finding that the driver was solely at fault. Before the jury returned a verdict on damages, the parties settled for $750,000. The client then filed a legal malpractice action against his initial attorney, alleging negligence in requesting an instruction based on § 1151 rather than N.Y. Veh. & Traf. Law § 1111. As damages, plaintiff sought to recover: (1) the legal fees that he incurred in moving to set aside the verdict in the first case, and in appealing the verdict; (2) the expert witness fees that he incurred in the second trial; and (3) $190,000 as an amount representing interest that would have accrued had he obtained a $750,000 recovery in the first trial.

The trial court granted partial summary judgment in favor of plaintiff, ruling that he was entitled to recover $28,703.27 as reimbursement for the attorneys’ fees incurred in obtaining a new trial and the expert fees incurred in the second trial. The trial court denied the motion with respect to plaintiff’s claim for interest. An appellate court reversed, and reasoned that the client did not sustain any actual damages because he had obtained a substantial recovery in the second trial. The Court of Appeals of New York reinstated the trial court’s ruling. "

Legal Malpractice can pop up in any number of situations.  Here is a totally unexpected possibility.  In a Blog blurb the Construction Attorney Blog talks about this problem:

"Much is being written about the 2007 AIA Documents, which were released in early November. One of the much-discussed differences in these documents is the fact that arbitration is no longer the default dispute resolution mechanism, being replaced by a "check-box" system whereby three options are provided: arbitration, litigation and "other." If none of the boxes is checked, then litigation is the default mechanism, following mandatory mediation.

It was with great interest that I opened the new documents using the AIA's Electronic Documents software system. I immediately printed out several of the new documents, including various owner-architect agreements and an owner-contractor agreement. At this point, I had not filled in anything. I was, therefore, astonished to find that the "arbitration" box had been checked on all of the documents where that option appeared. Thinking that I had made some type of mistake, I again started a brand new document and made sure not to check anything. Once again, the arbitration choice was checked.

However, most users today are using the electronic documents and may not be aware that they actually need to check the litigation box if that is what they intend. If they just read the articles that claim that litigation is the automatic "default," they may not even look at this provision when drafting the documents if they actually want to have litigation as the real default. They may be surprised years later to receive a demand for arbitration. If they are attorneys, they may be open to a claim for legal malpractice if their client insisted on not using arbitration and they relied on the "default" litigation story.

It is usually defendant's strategy to blame the client, at least to some extent.  Here in this case, even the court joined in.  Plaintiff was in an auto accident, hired an attorney who filed the complaint, and then gave up on discovery responses. Case dismissed, and incidently, the attorney was suspended, for an unrelated case.

Attorney lied to client, who eventually discovered the truth.  Outcome?  She sues attorney, wins uncollectible judgment, loses her attempt to revive auto accident suit.  Court says :

"Bland retained Graham in July 1998,” Sharer wrote. “It was not until December 2004, more than six years later, that she finally grew sufficiently suspicious of Graham’s inaction and failure to respond to her repeated calls, over several years time, to contact the Circuit Court directly to inquire into the status of her case. We agree with the trial court that Bland’s own actions do not rise to the level of ordinary diligence, nor did she satisfy her duty to keep herself informed of the status of her case."

Here is a case in which a husband's creditors executed upon his wife's jewlery.  Attorney is hired and the case ends with her having to give up 1/2 of the booty. Husband then sues the attorney.  Guess?  He hired the attorney for his wife, as a nominal defendant, since it was his creditors going after the goods.

Mistake?  In NJ it seems always to be a mistake not to file an affidavit of merits with the complaint, whether the mistake is open and obvious or not. 

The shortcoming?  No privity.  The outcome?  This case did not even get a written opinion.

"After a careful review of the record and briefs, we are satisfied that plaintiff's arguments are without sufficient merit to warrant discussion in a written opinion. R. 2:11-3(e)(1)(E). The motion for summary judgment was properly granted for the reasons set forth by the trial judge on the record. We add only the following comments on the spoliation claim which was not expressly addressed by the trial judge.

Here is a case from the Bronx in which a matrimonial client unsuccessfully sues her attorney.  Case is dismissed on the statute of limitations.  This was a pro-se plaintiff  v. pro-se defendant case.

"From June 12, 2000 to September 7, 2000, Plaintiff KINBERG retained Defendant GARR to represent her in her matrimonial Action, (which had been pending since 1992). This is evidenced by the parties' retainer agreement which provides that the legal services that GARR would be providing would be in connection with the then-pending Action, entitled Kinberg v. Kinberg, Index No.: 72304/1992, in New York County Supreme Court. (See Plaintiff's Exhibit "C"). The matter was scheduled for trial, on the equitable distribution of the marital assets, before the Hon. Justice Jacqueline Silbermann, on September 7, 2000, when the parties entered into a settlement Agreement, and KINBERG took the stand where she was allocuted on the Agreement. KINBERG testified that she understood the Agreement, wanted to accept it, and was satisfied with the services of her Counsel.

The rest of the decision documents the 6 year trail of litigation which ensued.  Plaintiff was successfully sued by the attorney, then she lost an action against her former husband, then lost an action against the attorney, and now, once again, loses.

If the attorney had not sued for his fees, would there have been 5 more years of litigation?

Sidewalk trip and fall cases have special problems associated with them.  As municipalities grew tired of being sued, they enacted strict notice rules, which, along with the General Municipal Law filing procedures, made for a maze.

Here is an example [from Newsbriefs of the NYLJ] of a case in which the town required plaintffs to file their notice in a special place, and then attempted to defend saying that the plaintiff followed the towns rule!

"In a case of first impression, a Brooklyn appeals panel has ruled that a municipality is estopped from claiming a lack-of-notice defense in sidewalk trip-and-fall cases if its employee instructs a member of the public to provide notice of a condition to the wrong department but the notice is nonetheless received by the department responsible for the record-keeping, inspection and repair of sidewalks. In a case involving a plaintiff who fell when her shoe allegedly was caught on an "uneven slab of sidewalk," the Town of Huntington denied receipt of prior written notice of the defect. Supreme Court Justice Gary J. Weber of Suffolk County (See Profile) denied the town's cross motion for summary judgment. Last week, in a 13-page opinion by Justice Mark C. Dillon (See Profile), the Appellate Division, Second Department, affirmed. "The Town, having instructed [a complainant] to send his written notice . . . to the director of the [Department of Engineering Services], cannot now be permitted to use that instruction as a shield against liability," Justice Dillon wrote. "To do so would result in an injustice to any claimant where there has been compliance with a clear directive, from a Town agent employed by the municipal department that maintains sidewalk complaint records, to file written notice of a dangerous sidewalk condition with someone other than the statutory designee." Gorman v. Town of Huntington, 06-05584, will be published Thursday

When a person who has a personal injury case files bankruptcy, they, in essence, give up that asset to the Trustee in Bankruptcy.  If the recovery is greater than the creditor's claims, then the plaintiff may get some money.  If not, then the entire proceeds go to the creditors.

Going along with this, the trustee in bankruptcy becomes the plaintiff.  Personal injury attorneys must play by bankruptcy rules, and, for example, must be permitted to represent the trustee by court order, any settlements are subject to court order, as are all fees, regardless of the retainer agreement.

Here is a case in which the personal injury attorney was ousted for simply not following the rules. "In April 2004, Ms. Smith filed for bankruptcy. She had debts of $14,000 and a single potential asset: a personal injury claim based on a sledding accident in which she was blinded in one eye. According to the circuit, "all parties agree that if the personal injury claim is successfully prosecuted, recovery would likely far exceed creditors' claims against Smith."

Ms. Smith retained Mr. Schwartz for the personal injury case with the initial approval of bankruptcy trustee Robert Geltzer. But the trustee later slammed Mr. Schwartz for naming Ms. Smith, and not Mr. Geltzer, as plaintiff in the action and then stalling for more than nine months to change the caption in the case while he brought in another lawyer without court approval.

The filing of the personal injury action under Ms. Smith's name, the circuit said in Schwartz v. Geltzer, 06-4450-bk and 06-5323-bk, "was the first in a litany of errors that, when viewed together, reflect at best a lack of understanding of the bankruptcy process and at worst an effort to circumvent its requirements."

Here is a story from Texas about a legal malpractice [or is it?] case in which the insurer asks the court to determine that it owes no defense.  The reason is not the usual "no notice' or "fraud in the application."  In this particular instance, the insurance company believes that the behavior complained of is not legal malpractice, but some other variant of uncovered wrong.

"A Kansas-based insurance company wants a declaration that it does not owe a defense to Fort Worth firm Cotten Schmidt in a separate suit filed against the firm. In Westport Insurance Corp. v. Cotten Schmidt LLP, et al., filed on Nov. 2 in U.S. District Court for the Northern District of Texas, Westport Insurance Corp. alleges that a legal malpractice policy that it issued to Cotten Schmidt does not cover a suit brought by Empire Equipment International Inc. and Robert Russell on Sept. 4, 2007, in Tarrant County district court against Cotton Schmidt alleging wrongful levy, execution and sale, and conversion. Cotten Schmidt and two of the firm's partners, Westport's suit alleges, "are not alleged to have committed those wrongful acts in the rendition of legal services. . . . "

Arising in the nature of inadvertant attorney client privilege, the question of meta data was recently discussed by Hinshaw:

"The D.C. Bar Association Legal Ethics Committee concluded that when a lawyer has actual knowledge that an adversary has inadvertently provided metadata in an electronic document, the lawyer should not review the metadata without contacting the sending lawyer and abiding by the sender’s instruction. This gives the sender the opportunity to determine if the metadata includes work product or confidential information of the sender’s client. In all other circumstances, however, the receiving lawyer is free to review the metadata contained in electronic files provided by an adversary"

Here is an interesting tidbit on fake lawyers, and the problems created by them. 

"The Problem of Barring Phony Lawyers from Practice

With so many bona fide lawyers struggling to obtain a job or attract clients, it's hard to believe that some people not only manage to impersonate real lawyers, but find real business and jobs as well. As this article from the Stamford Advocate (11/2/07) describes, phony lawyers are a growing problem in Connecticut, with the bar handling fifty fake cases per year. In Connecticut, most of the fake lawyer cases involve "notarios" who purport to offer legal assistance in immigration cases. But there are other cases, such as that of Brian Valery, a paralegal who duped his employer Anderson, Kill & Olick into believing that he'd gone to law school and passed the bar while working at the firm.


Most incredible, there's also the case of Howard Seidler, who has posed as a lawyer in courts around the country by using the name of a real lawyer, Howard Webber. Seidler sought admission by motion to the Connecticut bar, using another fake attorney by the name of Jermaine Johnson to sponsor him. The application contained several red flags; Seidler did not file an affidavit under oath and he and Johnson submitted the same bar number. But even though Seidler's application slipped through, his performance gave him away. During voir dire for a DUI case, Seidler asked potential jurors questions such as whether they liked animals, whether they could "envision the coffee table in front of them" or describe a house that they might see if, hypothetically, they were in a forest and came to a clearing. Finding this line of questioning a little odd, the prosecutor checked Seidler's background (who was using the name Webber) after the trial (the client was convicted after eight minutes) and discovered the fraud.


Seidler's case is now in the hands of the criminal justice system and not the bar -- he's being prosecuted for fraud. As for Seidler's client, he'll get a new trial, and investigators will try to recoup the $18,000 that the client spent for Seidler's service. In the meantime, Connecticut lawmakers are proposing legislation that would make unauthorized practice of law a felony punishable by at least a year in jail. Currently, the charge is a misdemeanor and according to bar officials, no one in Connecticut has ever been jailed for phony lawyering.


So the next time you're up against an incompetent lawyer, don't just laugh it off. Why not check the bar records -- most are readily available on line -- and make sure that your opponent is licensed to practice law?

Posted by Carolyn Elefant

They lost the huge legal malpractice case, he may be horse of the year.  It's astudy in contrasts.  Plaintiffs may be tne new owners of the Preakness and the Breeders Cup Stakes Winner .

"A state judge has given the plaintiffs, in a lawsuit against three lawyers, the right to claim part ownership of the 3-year-old colt who has earned more than $5.1 million on the track.

Judge William Wehr said the plaintiffs can make the claim through Midnight Cry Stables, the company used by attorneys Shirley Cunningham Jr. and William Gallion to buy the horse for $57,000.

Cunningham and Gallion own a 20 percent stake in Preakness Stakes winner Curlin, who won the Classic on Saturday under Midnight Cry Stables' blue and black colors. Curlin was third in the Kentucky Derby and second in the Belmont Stakes. and is likely to voted Horse of the Year.

The attorney for the 400-plus plaintiffs said the horse is now for sale, which prompted the move to claim Cunningham and Gallion's assets. Angela Ford, the lawyer who represents the plaintiffs, said there have been discussions about both a private sale and a public auction of Curlin, but no decisions had been made as of Friday morning.

"I wouldn't want to speculate on what he's worth," Ford said.

Wehr's order, issued late Thursday, comes in a case against Cunningham, Gallion and Lexington lawyer Melbourne Mills Jr. over the handling of a $200 million settlement in litigation over the diet drug fen-phen. Mills is not involved in the ownership of Curlin.

Wehr previously ruled that the attorneys bilked their clients of funds from the settlement and owe at least $42 million. Cunningham, Gallion and Mills are currently jailed in northern Kentucky awaiting a federal trial on charges of wire fraud stemming from the fen-phen settlement. They have pleaded not guilty."

This is really a horrible story.  Solo Attorney has a longtime office manager/secretary who uses the position to steal a lot of money from a client estate.  Secretary pleads guilty to crime.  Attorney left holding the bag.  Insurance company says it has no coverage for conversion. 

Q:  was it legal malpractice to allow the secretary such access/no oversight?

An often asked question in legal malpractice is: "what was the standard of good representation?  The following question is whether the attorney met that standard.  In trolling through the literature on this and other questions we ran across this interesting tidbit:  In West Virginia courts permit payment to jury researchers for indigent clients.  We have not heard of this before.

If this is the standard for criminal representation, is anything less for other defendants, criminal and civil, a deviation?

"Due diligence. Preparation. Undoubtedly, this is the most important responsibility that counsel owes to his or her client.

Inadequate representation due to poor preparation nearly always results in a negative outcome. Worst case scenario is the conviction of a criminal client who is innocent. But consider that the State of West Virginia provides public monies for trial research for indigent clients who are being represented by the Public Defender's Office. Our firm has conducted multiple change of venue surveys for clients of the Public Defender's office that were funded by taxpayer dollars. In each case, the judge approved the expenditure because the indigent client is entitled-the same as everyone else-to adequate representation. And trial research, like a court-appointed attorney, is considered essential to providing this adequate representation. "

When the statute starts to run in legal malpractice is an important consideration.  Here is a Pennsylvania case.  It's a complex anaysis, taking into account the date of the mistake, the date that actual damage happens, and continuing representation [not mentioned in this case]. 

"In Wachovia v. Ferretti, the appeals court panel rejected Wachovia's argument that it could not have brought a negligence claim against its attorney for an act that didn't result in damages until years later.

The court instead ruled that the statute of limitations for a breach of contract claim starts when the duty is breached and is only tolled until the plaintiff should reasonably have found out about the claim -- not until a judgment is entered or appeals are finished.

The appeals court pointed out that its ruling could require a client to pursue two legal actions with competing interests at the same time.

"We recognize Wachovia's public policy arguments, including their argument that, if the statute of limitations is to accrue upon the breach of a duty, a plaintiff in a legal malpractice action would be forced to take competing positions while defending the underlying claim and prosecuting their own legal malpractice action premised on that underlying claim," Judge John T. Bender said for the panel.

"Although we recognize this potential dilemma, the overriding public policy concern is that not commencing legal malpractice actions in a timely fashion results in stale claims."
"In Wachovia v. Ferretti, the appeals court panel rejected Wachovia's argument that it could not have brought a negligence claim against its attorney for an act that didn't result in damages until years later.

The court instead ruled that the statute of limitations for a breach of contract claim starts when the duty is breached and is only tolled until the plaintiff should reasonably have found out about the claim -- not until a judgment is entered or appeals are finished.

The appeals court pointed out that its ruling could require a client to pursue two legal actions with competing interests at the same time.

"We recognize Wachovia's public policy arguments, including their argument that, if the statute of limitations is to accrue upon the breach of a duty, a plaintiff in a legal malpractice action would be forced to take competing positions while defending the underlying claim and prosecuting their own legal malpractice action premised on that underlying claim," Judge John T. Bender said for the panel.

"Although we recognize this potential dilemma, the overriding public policy concern is that not commencing legal malpractice actions in a timely fashion results in stale claims."

This is not legal malpractice.  The story is remarkable, however.  Judge calls colleigue a "fool" and a group of other judges don't exactly disagree.  From Law.Com:

"Fulton Superior Court Judge Craig L. Schwall has told other members of the Fulton bench that Judge Hilton M. Fuller has bungled the Brian G. Nichols murder case and should be replaced.

In an Oct. 11 e-mail sent to all Fulton Superior Court judges, Schwall doesn't mince words, calling Fuller a "fool" and "embarrassment," adding "Surely he can be replaced."

The full text of the e-mail reads (with original punctuation and capitalization):

"From: Schwall, Craig, To: All Superior Court Judges."

"Is there any way to replace the debacle and embarrassment Judge Fuller is. He is a disgrace and pulling all of us down .He is single handedly destroying the bench and indigent defense and eroding the public trust in the judiciary. See his latest order. He can not tell the legislature what to do. ENOUGH IS ENOUGH. .Surely he can be replaced. He is a Fool .How is it done. Seek mandamus for a trial? We should investigate if it can be done."

The e-mail is signed: "From not shy in 5C."

Schwall uses courtroom 5C. The Daily Report obtained the e-mail from a source who is not involved in the case. Two Fulton Superior Court judges, who asked not to be identified, verified the authenticity of the e-mail.

Speaking as a group, the judges acknowledged the e-mail and dissatisfaction with Fuller. Asked to comment on Schwall's e-mail, the Fulton bench issued the following statement through its public information "

We will be speaking on this topic througout November, but here is a California case on the subject.  Its lesson:  the client confidence must be in issue.

"Case law does not “require dismissal whenever a law firm defendant suggests that client confidences are threatened,” Guilford wrote (.pdf). “Instead, they require a showing that the case can be tried fairly only by revealing client confidences. Irell represented the cable company and its chairman, uber-rich techie Paul Allen, in acquiring existing cable systems across the country. According to the tentative ruling (which had to assume the allegations are true), one of Irell’s associates mistakenly deleted two paragraphs of a contract, which led to Allen acquiring a type of stock he wasn’t supposed to. That forced Charter to pay Allen “millions of dollars” to undo the damage.

L.A.-based Irell tried to snuff the suit by arguing it could not defend itself without revealing Allen’s client confidences, over his objections. And while Guilford found that very well may end up the case, “the dust of initial posturing has not yet sufficiently settled” to determine whether Irell could mount a defense without breaking privilege.

The court found Irell had not yet pinpointed the specific privileged issues it needs to be able to discuss. "

Here is the story of a convicted ex-accountant who is selling a legal type service to inmates.  Now, he has problems.  Problem one:  he's not an attorney, and authorities are determining whether he gave legal advice.  Problem two: a group of angry inmates and their families. They are paying big fees for his service to make a motion seeking dismissal and release, all based on a purported jurisdictional glitch back in the Truman era.

"A small Austin company, International Legal Services, advertises that it can free just about any federal prison inmate on appeal, even those who pleaded guilty or confessed — a dubious claim that even the most prestigious law firms would never make.

The key is supposed to be a legal argument, developed by employee Tony Davis, that claims the federal criminal code is invalid because Congress botched key legislation during the Truman administration. As a result, most criminal convictions obtained in the past 59 years should be tossed out, Davis argues.

Davis, however, is not a lawyer. He's a former accountant who served almost 51/2 years in prison for fraud and money laundering — details International Legal Services fails to disclose to its clients, including about 160 inmates who paid up to $17,500 each for the company's services, potentially generating fees topping $1 million.

Nor does the company, which Davis said is owned by his wife, disclose that its ballyhooed legal argument has yet to free one inmate since Davis first used it to challenge his own 1998 conviction."

Attorney fees are regulated, and may be most regulated in matrimonial settings.  22 NYCRR 1400 regulates how fees are calculated, how they are billed, and most importantly, what happens if the procedures are not followed.

In this case, Sheresky Aronson & Mayefsky LLP v. Whitmore, 117068/06 ,Decided: October 5, 2007
Justice Doris Ling-Cohan NEW YORK COUNTY Supreme Court , the law firm of Sheresky Aronson & Mayefsky LLP  successfully represented the wife in a matrimonial, and had their fees paid by the husband.  Nevertheless, they wanted a premium for successful conclusion, from the wife, and proposed a $ 150,000 reward.  The wife paid $ 50,000 and then balked.

Law firm loses, for its failures with regard to 22 NYCRR 1400.3.  "22 NYCRR 1400.3 was "'promulgated to address abuses in the practice of matrimonial law and to protect the public'" (Mulcahy v. Mulcahy, 285 AD2d 587, 588 [2d Dept], lv denied 97 NY2d 605 [2001], quoting Julien v. Machson, 245 AD2d 122, 122 [1st Dept 1997]). The requirement that attorneys execute written retainer agreements with matrimonial clients is found not only in the Rule, but also in Code of Professional Responsibility, in Disciplinary Rule (DR) 2-106 (c) (2) (b), which forbids attorneys from collecting "[a]ny fee in a domestic relations matter . . . unless a written agreement is signed by the lawyer and client setting forth in plain language the nature of the relationship and the details of the fee arrangement." It is well settled that an attorney's noncompliance with the Rule generally precludes the attorney's recovery of fees in domestic relations matters (see Ackerman v. Gebbia-Ackerman, 19 AD3d 519 [2d Dept], dismissed 6 NY3d 740 [2005]; Bishop v. Bishop, 295 AD2d 382 [2d Dept 2002]). "

Reported in today's NYLJ, this is a convoluted case.  Plaintniff was misdiagnosed with breast cancer and underwent unnecessary mastectomy.  Her medical malpractice case was handled by the Morelli firm, and was dismissed on the statute of limitations, at the pleading stage.

The legal malpractice case followed, and has now survived two motions to dismiss.  The bottom line in the latest decision is that the med mal attorneys handled the case for three years, and are hard pressed to argue that it had no merit;  similarly, they had "something" to do with the pleadings, and may not now argue that the pleadings lacked merit.

Here is an Illinois legal malpractice case which illustrates the problem in bringing a legal malpractice case after a settlement in which the client has agreed that she understands the settlement, and agrees to it.  Add to this mix, the sometimes question, "are you satisfied with your attorney's handling of the case? 

The issue is whether the client also understood that there were shortcomings in discovery, in explanations to her, in investigation and reporting to the client of the applicable law or assets of the other side, when coming to a settlement.  Here, the client in a divorce action agreed to a settlement and then sued her attorney, alleging that there was insufficient investigation of her husband's assets, etc.  Accordingly, her  settlement, although she understood it, was based upon insufficient evidence, or "effectively compelled" by the attorneys preparation.

This is a twistedstory.  There are two reasons why this report is so out of the usual.  First, the defendant is not a US attorney.  He says that he is an attorney in Mexico, has an office in DC, where foreign attorneys may practice without a bar admission and he is then permitted to piggyback to practice law elsewhere.

The second reason is found in the story: "Attorney Thomas J. Henry filed the lawsuit Oct. 8 on behalf of Paloma Steele of Corpus Christi. Henry ran television ads last month alleging Celis was not licensed to practice law anywhere.

We have never seen television ads in aid of litigation.  Has anyone?

"Celis testified in an unrelated case in May that he was not licensed in Texas or any other state but is an attorney in Mexico. He said his law firm, CGT Law Group International, was incorporated in Washington, D.C., where laws allow non-lawyers and foreign lawyers to operate. Once established there, firms can transfer the right to operate to other states, Celis said.

Henry said Friday he would not disclose details of the case that prompted the lawsuit.

"It's an extremely serious case," Henry said.

Robert Vargas, Nueces County Court at Law No. 1 judge, recused himself from the case. Presiding Judge J. Manuel Bañales assigned Kleberg County Court at Law Judge Martin Chiuminatto Jr. to hear the case. No hearing has been set.

Celis, who regularly donated to Democratic causes in South Texas and nationally, was thrust into the limelight last month through a series of bizarre events.

On Sept. 15, a nearly nude woman fled his Kings Crossing home and Celis appeared on the scene flashing a Duval County sheriff's badge, asking that the woman be turned over to him, according to police reports. Celis' law enforcement credentials expired in 2003. Henry's commercials started airing shortly afterward, and Celis sued Henry and local television stations but later dropped the suit.

The Attorney General's Office sued Celis on Wednesday, alleging the law firm Celis operated broke the law in allowing him to take a share of profits."

We love rock and roll, and realise it did not end with Steely Dan.  Here is a Milwaukee group, well known [?] there, who eventually sued its manager, and now successfully sued its attorney.  The story:

"The long nightmare that has plagued the BoDeans is over. For nearly five years, the Milwaukee rock group was entangled in legal woes that drained their creative spirit and played havoc with their personal lives

Last week, the group reached a settlement with its former lawyer, ending a legal malpractice case that the BoDeans had filed. The settlement was for an undisclosed amount of money, but Milwaukee County Circuit Judge Jean DiMotto had ruled that there had been negligence on the part of the lawyer, Linda Mensch of Chicago. The trial that was supposed to have started last week was only to determine the amount of damages"

One would initially think that a communication between client and attorney on an issue arising from the attorney's representation of the client would be privileged.  In this case, recently decided by Justice Charles E. Ramos of Supreme Court, New York County, the privilege was waived.

"On August 10, 2005, BI's counsel, Marvin Wexler of Kornstein Veisz Wexler & Pollard, LLP ("KVW"), sent a letter to plaintiff's counsel, Stuart Kagen of Paul, Weiss Rifkind Wharton & Garrison LLP ("PW"), asserting that BI was in possession of e-mail correspondence between Dr. Scott and PW pertaining to Dr. Scott's dispute with BI, as well as e-mails written between Dr. Scott and Cohen Lans LLP regarding a separate dispute. The letter further stated that although no one at BI had read the e-mails yet, BI believed that any potential privilege attached to the communications had been waived by use of BI's e-mail system.

Mr. Kagen responded on August 15, 2005, informing Mr. Wexler that the documents are privileged communications belonging to Dr. Scott for which there had been no waiver of privilege and requesting the immediate return of the e-mails to Dr. Scott.

When BI refused to return the documents, the parties called Andrea Masley, the Judge's Court Attorney, who instructed BI to provide copies of the e-mails to Dr. Scott, place copies of [*2]the documents into a sealed envelope and bar anyone from reviewing the e-mails pending a resolution by the Court. Thereafter, Dr. Scott filed this motion for a protective order seeking the return of the documents.[FN4]

Dr. Scott argues that the e-mails are privileged under both the attorney client privilege and work product doctrine. BI counters that the e-mails were never protected by the attorney client privilege because Dr. Scott could not have made the communication in confidence when using BI's e-mail system in violation of BI's e-mail policy. BI also argues that both privileges were waived by Dr. Scott's use of BI's e-mail system.

The final factor is whether Dr. Scott had notice of the policy. Dr. Scott had both actual and constructive knowledge of the policy. BI disseminated its policy regarding the ownership of e-mail on its server to each employee in 2002, including Dr. Scott and provided internet notice. See Garrity v John Hancock Mutual Life Ins. Co., No. Civ Action 00-12143-RWZ, 2002 WL 974676, at 1 (D Mass, 2002)(Company e-mail policy precluded reasonable expectation of privacy despite employee's claim that policy was hard to find on company intranet).

Dr. Scott's effort to maintain that he was unaware of the BI e-mail policy barring personal use is rejected. As an administrator, Dr. Scott had constructive knowledge of the policy. Perez Moya v City of New York (9 Misc 3d 332 Sup Ct, Kings County 2005)(Superintendent's knowledge of the residency of child imputed to the City); Polidori v Societe Generale Group., 236 NYLJ 112 (Sup Ct NY County 2006) (Knowledge of sexual harassment will be imputed to employer if supervisor of a sufficiently high level is aware of the harassment), affd, 39 AD3d 404 (1st Dept 2007). He required newly hired doctors under his supervision to acknowledge in writing that they were aware of the policy. Under these circumstances, Dr. Scott is charged with knowledge of the BI e-mail policy.

Alternatively, Dr. Scott argues the e-mails are privileged work product. The work product doctrine provides a qualified privilege against disclosure for materials prepared by an attorney in anticipation of litigation. CPLR 3101(c). The issue is whether the work product privilege was waived. Under New York State law, work product is waived when it is disclosed in a manner that materially increases the likelihood that an adversary will obtain the information. See Bluebird Partners, L.P. v First Fidelity Bank, N.A., New Jersey, 248 AD2d 219, 225 (1st Dept. 1998). While an inadvertent production of a privileged work product document generally does not waive the applicable privilege, there is an exception to that rule if the producing party's conduct "was so careless as to suggest that it was not concerned with [the] protection of [the] asserted privilege." Critical to this determination is the reasonableness of the precautions taken to prevent inadvertent disclosure. SEC v Cassano, 189 FRD 83, 85 n.4 (SDNY 1999). "

There's not a lot to comment on in this story.  Simply count up the legal malpractice issues: conflict of interest, attorneys switching sides, surreptitious spying, computer hacking on attorney-client e-mails...

"By the time it was finally hauled into court last year, it had all the ingredients of a cheap detective novel: the millionaire husband of a seductive singer and the P.I. he’s paying to tail her; hidden (and possibly tax payer-funded) cameras; hacked computers; two-bit lawyers who’ll even turn on their own clients if the retainer is juicy enough; and at the heart of it all, lots of money up for grabs. The case is still in litigation, the attorneys and litigants tight-lipped, and what can’t be deduced from the public record at the courthouse is left to swirl in the air of bridge club gossip.

Presumably, Stella Black–recognizable to many as the busty brunette in the Whit-Ash Furniture commercials– had no idea that her husband had been conspiring to leave her for months. Nor, she claims, could she have known that he had fully infiltrated her music career and that her confidante and talent agent as well as her entertainment lawyer were both working clandestinely on his payroll to spy on her, according to one affidavit.

Stella Black’s affidavit repeatedly refers to a private investigator named Edwards and her pending legal malpractice suit in common pleas court against Whit-Ash names one Jim Edwards as a defendant. According to court documents, Edwards installed hidden cameras “that were secretly mounted at and around Plaintiff’s residence” in Forest Acres. 

Phillips allegedly began forwarding Stella’s private emails and secret transcripts of her meetings with attorneys to Black and his crew. Later, she claims, they set up a wide area network (WAN) that connected Whit-Ash computers to her home computer so they could have unfettered access to her hard drive and email.

Phillips also allegedly installed Spector Pro software on her laptop to capture every keystroke and create screen shots of Stella’s emails to her attorneys. And when the preliminary divorce proceedings were underway, Stella looked up to see none other than her entertainment lawyer, Rebecca West, representing Whit. She believes it had been planned all along ."
 

Here is a simple, short article that covers a wide set of damaged individuals.  Hurt here are: plaintiff, defendant and witness.

"A Fayetteville woman was awarded more than $360,000 in both actual and punitive damages in a civil malpractice suit she filed against a local attorney.

A Fayette County State Court jury handed down the verdict against Daniel Richard Hayes Oct. 16 after a two-day trial.

Hayes, of Jones Circle, Fayetteville, also was held in contempt of court for inappropriately questioning a witness during the trial despite warnings not to do so by State Court Judge Fletcher Sams, according to court records. Hayes paid a $200 fine, escaping a two-day jail sentence for the transgression.

In the suit, Betty Goza claimed that she retained Hayes via a contract several months after she was injured in an automobile crash that was the subject of the suit. Goza claimed that Hayes failed to properly serve the defendants with notice of the suit, and he also failed to notify her when the suit was dismissed because the two-year statute of limitations had expired. "

Here is a worthy article on Judicary Law section 487 by  Norman B. Arnoff and Sue C. Jacobs in  the October 24, 2007 New York Law Journal.  It should be read by attorneys, as this statute applies to them alone.

"Lawyers are officers of the court, as such, they must be ethically responsible not only in the courtroom but in all aspects of their professional lives. The omnipresence of the attorney's ethical obligations assures that the law will be soundly interpreted and applied.

In order to guarantee lawyers have a heightened consciousness for their professional and ethical obligations inside the courtroom and beyond, there are several statutes and court rules to which members of the bar should pay serious attention.

A serious point for consideration by every member of the New York Bar is Judiciary Law §487, which provides:


An attorney or counselor who:

1. Is guilty of any deceit or collusion, or consents to any deceit or collusion with intent to deceive the court or any party, or

2. Willfully delays the client's suit with a view to his own gain, or willfully receives any money or allowance for an account of any money which he has not laid out, or becomes answerable for

Is guilty of a misdemeanor, and in addition to the punishment prescribed therefore by the penal law, he forfeits to the party injured treble damages, to be recovered in a civil action.


The statute is intended not merely to deter litigation abuse but the misuse of client funds in connection with litigation. The statute covers a lawyer's deception of the court or any party to the litigation including the lawyer's client or a party not represented by the lawyer whose conduct is in issue. The statute's intent is to deter serious misconduct that possibly rises to the level of criminality and as a result subjects the lawyer to treble damages to the injured party in a civil action. "

This is a sordid story of a professor who was barred from teaching at a university.  He was accused of making rather coarse sexual comments to students, many of them. While litigating over his potential dismissal, a letter was sent to one witness with a photocopy of the definition of perjury and a suggestion of how she could purge herself of that problem.  To make matters worse, a similar letter was sent to the university secuity department alleging that the witness had committed perjury on campus.

Judge Diamond, of Supreme Court, New York County levied significant sanctions on client and attorney. As the NYLJ reports :

"Mr. Kalyanaram's attorney, Mr. Richman, sent a letter to Ms. Cui that "attached a copy of the penal statute regarding the crime of perjury and then proceeded to advise her that if her allegations against petitioner are untrue, she could be guilty of such a crime," according to the decision.

The letter also stated that "if she changed her affidavit to rectify any untrue statements, she may have a defense to a perjury charge."

Mr. Richman sent a second letter to the directors of the institute's security, which stated he believed Ms. Cui had committed perjury on the school's premises.

Petition Denied

In a decision issued last week, Justice Diamond denied Mr. Kalyanaram's petition for reinstatement and granted the school's motion for sanctions.

"The petitioner's claim herein turns on the sole issue of whether the respondent, in dismissing him prior to the conclusion of the grievance and arbitration process, breached the terms of the governing collective bargaining agreement," Justice Diamond wrote. "The respondent's letter to the petitioner specifically stated that . . . he was to remain on the payroll at his regular salary until a final determination had been rendered. Thus, the respondent expressly recognized that petitioner remained an employee until the conclusion of the grievance and arbitration process."

In addition, in a scathing analysis of the sanctions issue, the court again found against Mr. Kalyanaram and his attorney Mr. Richman.

"Such threats cannot be countenanced," Justice Diamond wrote. "They are an inappropriate and reprehensible attempt to influence a proceeding and obtain an outcome therein through extra-judicial means. Indeed, the threats are particularly pernicious because they carry the real possibility that even a witness who is otherwise entirely truthful will refrain from giving such testimony in order to avoid being the target of a criminal investigation."

Borrowing a sister state's statute of limitations is the province of "choice of law", which is a rather esoteric law school subject.  For our purposes, which state's law should be applied depends on where the action is brought, where the wrong took place, where the parties were subject to service of process and jurisdiction.

Here is a case in which plaintiffs wished to sue a NY attorney yet use the Tennesee statute of limitations.  The reason?  It was too late to use the NY statute of limitations.  The case, GML Inc. v, Cinque & Cinque was recently decided by the Court of Appeals.

"The action was started in New York, and as such, it was unnecessary to toll the statute of limitations..." 

Pro-Bono work at Big Law or at Big Companies in house law departments has radically increased over the past 10 years.  One reason is the availability of legal malpractice insurance.  Here is an interesting article on the current status:

"Q: How successful has the challenge been?

A: Anecdotally, we know that more companies are getting involved in pro bono. Dozens are putting formal programs in place. We have an annual report for signatories that we're sending out this fall. It asks about the level of participation in their legal departments, the kinds of projects, if they're keeping [track of their pro bono] time, and about their partnerships with public interest organizations and law firms. We'll hopefully have answers by February.

Q: You called it a challenge for a reason: In-house departments face obstacles in doing pro bono that law firms don't. Were there any issues you weren't expecting?

A: The right fit can be a tough issue. Take Tyson [Foods Inc.,] and Wal-Mart [Stores Inc.]. Both are headquartered in rural areas with a fairly narrow range of legal needs. There's not necessarily a great fit between the skills of the legal department and the needs of the local community. And we learned from Intel [Corp.] that there's a whole group of lawyers who are licensed to practice, but not in the jurisdiction where they're located. There are very few states where lawyers who are not [locally] licensed can do pro bono easily.

Q: Which companies really succeeded with the challenge?

A: Intel is a great model because it has such a well-planned program. They [used requests for proposals to find law firm partners, and] tied pro bono work to areas of interest in the department and company as a whole. They started in their [Santa Clara, Calif.,] headquarters, but have expanded to other offices as well.

Q: For a while it seemed that companies weren't doing pro bono because they thought the costs were prohibitive. What changed?

A: Before, they just didn't know what was available to them. When companies started doing pro bono, malpractice insurance was always something they asked us about. [In-house lawyers are not always insured for malpractice.] Today, the areas on our Web site that cover malpractice are probably the most accessed. A company can work with a program that provides the coverage, purchase a rider, or get malpractice insurance for about $3,000 a year for the whole company. "

Service of process cases turn on the facts, and generally do not provide either generalized rules or sweeping policy arguments,  Here is a case in which the attorney's door was locked, there was no answering machine and nothing personalized about the place except a shingle.  Not exactly a downtown NYC type of office.

"According to an affidavit of service dated September 9, 2004, the process server attempted to serve the defendant with a copy of the summons and complaint in the legal malpractice action at his actual place of business on August 23, 2004, at 10:00 A.M. The process server observed the defendant's name on an outside shingle, but the office was closed, locked, and without a doorbell. The process server used his cellular phone to call the number listed on the outside shingle and received neither a personal reply nor an answering service reply. Nonetheless, that same day the process server mailed the summons and complaint to the very same premises in order to ostensibly effectuate "nail and mail" service. On the following day, August 24, 2004, the process server returned to the same location at 9:00 A.M. and, upon seeing that the conditions were the same as the day before, affixed the summons and complaint to the door.

Although the building at which process was purportedly served was in fact owned by the defendant and/or his wife, and was used as both a law office and an office to collect rents and issue leases for their other properties, the defendant was, in fact, suspended from the practice of law at the time of the attempted service of process.

Service of process must be made in strict compliance with statutory "methods for effecting personal service upon a natural person" pursuant to CPLR 308 (Macchia v Russo, 67 NY2d 592, 594; see Dorfman v Leidner, 76 NY2d 956, 958). CPLR 308 requires that service be attempted by personal delivery of the summons "to the person to be served" (CPLR 308[1]), or by delivery "to a person of suitable age and discretion at the actual place of business, dwelling place or usual place of abode" (CPLR 308[2]). Service pursuant to CPLR 308(4), commonly known as "nail and mail" service, may be used only where service under CPLR 308(1) or 308(2) cannot be made with "due diligence""

New York Lawyer, an offshoot of Law.Con brings this story:

"Two inventors of snowboard bindings accuse their lawyers at Seyfarth Shaw and Burnett, Burnett & Allen of doing a legal face plant that caused them to lose a patent infringement case.

In a lawsuit filed in Santa Clara County, Calif., Superior Court last month, Richard and Brandt Berger accuse the lawyers of negligence and fraud and claim to have suffered damages of more than $75 million. On Wednesday, the suit was removed to the Northern District of California, following rulings by the U.S. Court of Appeals for the Federal Circuit on Monday on the appropriate jurisdiction for IP malpractice claims.

The plaintiffs allege that IP veteran Jack Slobodin, a former Seyfarth partner, provided the court with a "fatally defective" claim chart prepared by his firm, then blamed the mistake on an attorney "that was handling it before" him. In February -- one month after the patent case in question, Berger v. Rossignol, finished up -- Slobodin left Seyfarth to join Gordon & Rees as of counsel.

A Seyfarth spokesman said Slobodin left of his own accord, but declined to comment on the suit. Lawyers for Seyfarth and Slobodin from Keker & Van Nest also declined to comment on the case.

The infringement suit was filed in 2005 with the help of San Jose, Calif., attorney Douglas Allen of Burnett, Burnett & Allen. Seyfarth provided Allen with a claim chart for the binding, but the Bergers say that the chart -- which was to detail each point of the alleged infringement -- was erroneous. "

We originally reported this case on  9/28.  Here is a well written decision concerning Akin Gump in which some causes of action are dismissed.  Tott, Contract, Fraud, Fiduciaries...how do all of these different theories of liablitiy interact?  Read on:

The Case:

"Defendant's motion, pursuant to CPLR 3211 (a) (7), to dismiss plaintiffs' second, fifth and ninth causes of action, for gross negligence, the third cause of action for negligent misrepresentation and the seventh cause of action, for breach of fiduciary duty, as redundant of the legal malpractice claims, is granted. It is well settled, in this Department, that gross negligence, negligent misrepresentation, and breach of fiduciary duty claims, arising out of the same set of operative Facts, and seeking the same damages or relief, as a viable legal malpractice claim, are redundant, and subject to dismissal pursuant to CPLR 3211 (a) (7) (see Weil, Gotshal & Manges, LLP v. Fashion Boutique of Short Hills, Inc., 10 AD3d 267 [1st Dept 2004]; InKine Pharmaceutical Co., Inc. v. Coleman, 305 AD2d 151 [1st Dept 2003]; Mecca v. Shang, 258 AD2d 569 [2d Dept 1999]). As accurately outlined by defendant, the second cause of action asserted in plaintiffs' complaint for gross negligence, and the third cause of action for negligent misrepresentation, arise out of the identical Facts, and seek the same relief as plaintiffs' first cause of action for malpractice. The fifth cause of action for gross negligence and the seventh cause of action for breach of fiduciary duty arise out of the same operative Facts, and seek the same relief, as the fourth cause of action for malpractice, and the ninth cause of action for gross negligence arises out of the same Facts, and asserts damages identical to the Facts and damages alleged under the eighth cause of action for legal malpractice. Plaintiffs' argument, that the claims should be reviewed under Texas law, does not mandate a different result (see Camp v. RCW & Co., Inc., 2007 WL 1306841, *5 [SD Tex 2007], quoting Goffney v. Rabson, 56 SW 3d 186, 190 [Tex App, Houston 2001]["Texas law does not permit a plaintiff to divide or fracture her legal malpractice claims into additional causes of action"]; see also Aiken v. Hancock, 115 SW 3d 26, 28 [Tex App, San Antonio 2002]; Ersek v. Davis & Davis, P.C., 69 SW 3d 268, 274 [Tex App, Austin 2002]). Plaintiffs' request for leave to amend the eighth cause of action is denied, as the proposed amendment does not cure the redundancy (see Feldman v. Jasne, 294 AD2d 307 [1st Dept 2002]; Bencivenga & Co. v. Phyfe, 210 AD2d 22 [1st Dept 1994]).

That portion of defendants' motion which seeks partial dismissal of plaintiffs' sixth cause of action for fraud, on documentary evidence, pursuant to CPLR 3211 (a) (1), is denied. On a motion pursuant to 3211 (a) (1), the court must accept the complaint's factual allegations as true, according plaintiffs the benefit of every possible favorable inference, and dismissal is warranted only if the documentary evidence submitted conclusively establishes a defense to the asserted claims as a matter of law (Arnav Indus. Inc., Retirement Trust v. Brown, Raysman, Millstein, Felder & Steiner, LLP, 96 NY2d 300, 303 [2001]; Leon v. Martinez, 84 NY2d 83, 87-88 [1994]; Weil,, Gotshal & Manges, LLP v. Fashion Boutique of Short Hills, Inc., 10 AD3d at 271-71). The documentary evidence relied upon by the defendant in this matter consists of a June 28, 2004 letter executed by McBride on behalf of the Veras entities, and by McBride, Larson and Virginia in their individual capacities, acknowledging the existence of potential conflicts of interest, including but not limited to those alleged in the instant complaint. Defendants also annex various drafts of the letter. All drafts were prepared in or around June 2004, after the individual plaintiffs retained independent counsel.

The document, executed nearly a year after the investigations commenced, has little probative value with respect to plaintiffs' allegations that, when Akin Gump undertook plaintiffs' defense in or around September 2003, it knowingly and purposefully failed to disclose inherent and nonwaivable conflicts of interest, or with respect to acts occurring prior to the negotiation or execution of the letter. Plaintiffs' allegations also raise issues of fact with respect to whether the consent letter is effective in these circumstances (see Kelly v. Greason, 23 NY2d 368, 378-79 [1968][in certain situations, there can be no effective consent]; see also, e.g. Parklex Assoc. v. Parklex Assoc., 15 Misc 3d 1125(A), 2007 WL 1203617, *5 [Sup Ct, Kings County 2007][attorneys could not rely on purported waiver of conflict of interest where such conflict could subject an attorney to disciplinary action under DR-105, 22 NYCRR §1200.24(c)]; Booth v. Continental Ins. Co., 167 Misc 2d 429, 439 [Sup Ct, Westchester County 1995][full disclosure and consent does not insulate an attorney where the conflict of interest affects or appears to affect the attorney's obligations]). Finally, in light of defendant's failure to demonstrate a right to relief based upon documentary evidence, it is not necessary, at this time, to address the issues of fact raised by plaintiffs' belated claims of coercion."

We originally reported this case on  9/28.  Here is a well written decision concerning Akin Gump in which some causes of action are dismissed.  Tott, Contract, Fraud, Fiduciaries...how do all of these different theories of liablitiy interact?  Read on:

The Case:

"Defendant's motion, pursuant to CPLR 3211 (a) (7), to dismiss plaintiffs' second, fifth and ninth causes of action, for gross negligence, the third cause of action for negligent misrepresentation and the seventh cause of action, for breach of fiduciary duty, as redundant of the legal malpractice claims, is granted. It is well settled, in this Department, that gross negligence, negligent misrepresentation, and breach of fiduciary duty claims, arising out of the same set of operative Facts, and seeking the same damages or relief, as a viable legal malpractice claim, are redundant, and subject to dismissal pursuant to CPLR 3211 (a) (7) (see Weil, Gotshal & Manges, LLP v. Fashion Boutique of Short Hills, Inc., 10 AD3d 267 [1st Dept 2004]; InKine Pharmaceutical Co., Inc. v. Coleman, 305 AD2d 151 [1st Dept 2003]; Mecca v. Shang, 258 AD2d 569 [2d Dept 1999]). As accurately outlined by defendant, the second cause of action asserted in plaintiffs' complaint for gross negligence, and the third cause of action for negligent misrepresentation, arise out of the identical Facts, and seek the same relief as plaintiffs' first cause of action for malpractice. The fifth cause of action for gross negligence and the seventh cause of action for breach of fiduciary duty arise out of the same operative Facts, and seek the same relief, as the fourth cause of action for malpractice, and the ninth cause of action for gross negligence arises out of the same Facts, and asserts damages identical to the Facts and damages alleged under the eighth cause of action for legal malpractice. Plaintiffs' argument, that the claims should be reviewed under Texas law, does not mandate a different result (see Camp v. RCW & Co., Inc., 2007 WL 1306841, *5 [SD Tex 2007], quoting Goffney v. Rabson, 56 SW 3d 186, 190 [Tex App, Houston 2001]["Texas law does not permit a plaintiff to divide or fracture her legal malpractice claims into additional causes of action"]; see also Aiken v. Hancock, 115 SW 3d 26, 28 [Tex App, San Antonio 2002]; Ersek v. Davis & Davis, P.C., 69 SW 3d 268, 274 [Tex App, Austin 2002]). Plaintiffs' request for leave to amend the eighth cause of action is denied, as the proposed amendment does not cure the redundancy (see Feldman v. Jasne, 294 AD2d 307 [1st Dept 2002]; Bencivenga & Co. v. Phyfe, 210 AD2d 22 [1st Dept 1994]).

That portion of defendants' motion which seeks partial dismissal of plaintiffs' sixth cause of action for fraud, on documentary evidence, pursuant to CPLR 3211 (a) (1), is denied. On a motion pursuant to 3211 (a) (1), the court must accept the complaint's factual allegations as true, according plaintiffs the benefit of every possible favorable inference, and dismissal is warranted only if the documentary evidence submitted conclusively establishes a defense to the asserted claims as a matter of law (Arnav Indus. Inc., Retirement Trust v. Brown, Raysman, Millstein, Felder & Steiner, LLP, 96 NY2d 300, 303 [2001]; Leon v. Martinez, 84 NY2d 83, 87-88 [1994]; Weil,, Gotshal & Manges, LLP v. Fashion Boutique of Short Hills, Inc., 10 AD3d at 271-71). The documentary evidence relied upon by the defendant in this matter consists of a June 28, 2004 letter executed by McBride on behalf of the Veras entities, and by McBride, Larson and Virginia in their individual capacities, acknowledging the existence of potential conflicts of interest, including but not limited to those alleged in the instant complaint. Defendants also annex various drafts of the letter. All drafts were prepared in or around June 2004, after the individual plaintiffs retained independent counsel.

The document, executed nearly a year after the investigations commenced, has little probative value with respect to plaintiffs' allegations that, when Akin Gump undertook plaintiffs' defense in or around September 2003, it knowingly and purposefully failed to disclose inherent and nonwaivable conflicts of interest, or with respect to acts occurring prior to the negotiation or execution of the letter. Plaintiffs' allegations also raise issues of fact with respect to whether the consent letter is effective in these circumstances (see Kelly v. Greason, 23 NY2d 368, 378-79 [1968][in certain situations, there can be no effective consent]; see also, e.g. Parklex Assoc. v. Parklex Assoc., 15 Misc 3d 1125(A), 2007 WL 1203617, *5 [Sup Ct, Kings County 2007][attorneys could not rely on purported waiver of conflict of interest where such conflict could subject an attorney to disciplinary action under DR-105, 22 NYCRR §1200.24(c)]; Booth v. Continental Ins. Co., 167 Misc 2d 429, 439 [Sup Ct, Westchester County 1995][full disclosure and consent does not insulate an attorney where the conflict of interest affects or appears to affect the attorney's obligations]). Finally, in light of defendant's failure to demonstrate a right to relief based upon documentary evidence, it is not necessary, at this time, to address the issues of fact raised by plaintiffs' belated claims of coercion."

Here is an appellate decision in the DuPont environmental and cancer case.  There is no mention of legal malpractice here.  Note however, the precluded experts, the precluded documents, and how the dissent paints the majority as corporate lackeys.

The case:"Glen Strong (Strong) and his wife, Connie, collectively "the Strongs," were among thirty-seven plaintiffs who filed suit in the Circuit Court of Jones County, Mississippi, Second Judicial District, against E.I. DuPont de Nemours Corporation (DuPont) in December 2002, in the matter of Govan v. DuPont, et al., Cause No. 2002-376-CV12. The Strongs did not have an individual complaint.1 At the same time, a larger group of approximately 2,200 plaintiffs filed a separate complaint against DuPont in the matter of Lizana v. DuPont, et al., Cause No. 2002-377-CV12, alleging similar injuries as in the Govan complaint. In fact, the only major difference in the two complaints was that the plaintiffs' names were different.

¶ Two Mississippi residents also were named as defendants in the complaints, namely Waste Management of Mississippi and G.B. Boots Smith Corporation, a Laurel trucking company used to fix venue in Jones County, Mississippi.2 DuPont immediately removed the Govan and Lizana cases to federal court. DuPont alleged the fraudulent joinder of Waste Management and Boots Smith. The federal court remanded the Govan and Lizana cases to the trial court in February 2004.

I. Striking DuPont's experts.

¶ This appeal follows a laborious and highly contentious discovery process during which the trial court struck nine of DuPont's witnesses, including the majority of its designated experts. The trial court determined that "based upon the record, the history of abuses in this case, and pursuant to Miss. R. Civ. P. 37(b)(2), 37(e), Rule 11 and the court's inherent powers to impose sanctions on those who abuse the Mississippi Rules of Civil Procedure, the Court finds that DuPont has indeed abused the Mississippi Rules of Civil Procedure."

¶ In its order in cause number 2005-M-01583-SCT dated August 16, 2005, this Court already ruled on DuPont's emergency petition for interlocutory appeal and motion for stay regarding the trial court's ruling to strike its experts, stating:

Petitioner seeks relief from the trial court's order striking certain report and fact witnesses from participation in the trial scheduled for August 17, 2005. The Court finds that the trial court granted the motion to strike these witnesses as a sanction for petitioner's prior abuse of the discovery process. The Court therefore finds that the emergency petition for interlocutory appeal and motion for stay should be denied. "

"DIAZ, PRESIDING JUSTICE, DISSENTING:

¶ One would never know from reading the majority the basis of Strong's claims against DuPont: that for years DuPont knowingly deposited tons of toxic material into the waters of Bay St. Louis; that according to the United States Environmental Protection Agency (EPA), the DeLisle plant is the second largest emitter of potentially-carcinogenic dioxins in the country; that DuPont was aware of the risks associated with human exposure to these toxins since at least 1983; and that Glen Strong incurred roughly $675,000 in medical bills for treating his cancer which developed after living his entire life in close proximity to the plant and eating contaminated seafood from the bay. In light of these facts, and the thousands of pages of documentation supporting his claims, the "errors" found by the majority can hardly be deemed reversible.

¶ Today's case is yet another example of this Court's willingness to overturn a jury verdict when individuals have been awarded large damages against corporate defendants. In the last two years, this Court has been asked to consider at least eight cases involving large damage awards in favor of individual plaintiffs, and seven of these cases have been reversed. Mariner Health Care, Inc. v. Estate of Edwards, 2007 Miss. LEXIS 520 (Miss. Sept. 13, 2007) (reversing $6.5 million jury award against nursing home); Horace Mann Life Ins. Co. v. Nunaley, 960 So. 2d 455 (Miss. 2007) (reversing $1.9 million jury award and rendering judgment in favor of life insurance company); Baker, Donelson, Bearman & Caldwell, P.C. v. Muirhead, 920 So. 2d 440 (Miss. 2006) (reversing $1.6 million jury award for legal malpractice and rendering judgment in favor of defendant law firm); Hartford Underwriters Ins. Co. v. Williams, 936 So. 2d 888 (Miss. 2006) (reversing $1.5 million jury award against insurance company); Irby v. Travis, 935 So. 2d 884 (Miss. 2006) (reversing $3.75 million jury award in wrongful death case); GMC v. Myles, 905 So. 2d 535 (Miss. 2005) (reversing $5.4 million award in wrongful death case); 3M Co. v. Johnson, 895 So. 2d 151 (Miss. 2005) (reversing $25 million jury award and rendering judgment in favor of manufacturer). Compare Canadian Nat'l/Ill. Cent. R.R. v. Hall, 953 So. 2d 1084 (Miss. 2007) (affirming $1.5 million jury award against employer). See also Jimmie E. Gates, Justices Void $36.4M Award in Insurance Suit, Clarion Ledger, Oct. 2, 2007, at A1. Yet, despite the substantial evidence in this case supporting a jury verdict in favor of the plaintiffs, the majority finds enough "cumulative error" to warrant a reversal. At some point, we must defer to the finders of fact and stop substituting this Court's judgment for that of the jury.

¶ For the foregoing reasons, I would affirm the judgment of the trial court. "

As any first year law student can tell you, pleadings are required simply to put the other side on notice of the general proposal of the complaint:  You injured me in tort, by doing "x".  One simply puts the other side on notice, and if they are interested [as they always are], then they ask for discover.

This blog blurb from the Scottsdale blog tells us the current story in Arizona.  His warning?  Use facts, and lots of them.

"There's a new case out this week from Division Two, Cullen v. Koty-Leavitt Insurance, which deals with the reasonable expectations doctrine in the UIM setting. The case is not particularly fascinating from a substantive perspective, but it raises questions about potential legal malpractice exposure.

In sum, Cullen filed a UIM claim based upon the fact that his family was given the right to privately use a business vehicle. The vehicle was owned by the business, Sierrita Mining and Ranch Company, and had UIM coverage with Auto Owners. The named insured was the business, and there were no additional insureds.

Cullen was injured while riding in another vehicle and filed a UIM claim with Auto Owners. The insurer denied his UIM claim, he then filed suit and the trial court dismissed the action.

First, the Court of Appeals expressly adopted the Supreme Court's holding in Bell Atlantic Corp. v. Twombly, the case that overruled the familiar Conley v. Gibson standard for dismissal.

This is a significant move and one wonders how the Arizona Court of Appeals, which is bound to follow the Arizona Supreme Court on such matters, saw fit to disregard the Arizona Supreme Court and unilaterally adopt the United States Supreme Court's Twombly holding. In any event, doubt no further, the "notice pleading" landscape has changed in Arizona as follows:

"While a complaint attacked by a Rule 12(b)(6) . . . motion to dismiss does not need detailed factual allegations, a plaintiff's obligation to provide the 'grounds' of his 'entitle[ment] to relief' requires more than labels and conclusions, and a formulaic recitation of the elements of a cause of action will not do." Instead, the complaint's "[f]actual allegations must be enough to raise a right to relief above the speculative level."
The Court stated "when a complaint fails to recite at least the basic facts supporting a claim for relief, we cannot see how a defendant would have fair notice of the nature and basis of the claim." "

From NY Lawyer we get this report:

"Pillsbury Winthrop Shaw Pittman partners Paul Tummonds Jr. and Patrick Potter are the targets of a $50 million malpractice complaint filed by former client Capitol Hill Group.

According to the complaint filed on September 7 in D.C. Superior Court, the plaintiff owned property at 700 Constitution Ave. N.E., leased to a nursing home and a hospital. At issue was the number of parking spaces needed.

Initially, the city said 85. When a neighborhood group appealed, Capitol Hill Group tapped Tummonds and Potter for help. According to the complaint, the D.C. Board of Zoning Adjustment first rejected the appeal. The board reconsidered a portion of its denial, however, and eventually issued a final order requiring 177 parking spots. That was in September 2004.

And now for the rub — Capitol Hill Group claims that its counsel did not inform it of the final order until the spring of 2005. At that point, the property had too few spaces, and the group could no longer appeal. The result, according to the complaint: upwards of $50 million in losses. "

Blogs and trials have been a recent confluence.  Dr. Flee, who blogged his own trial was one [well reported by the New York Personal Injury blog of Eric Turkowitz.

Now, jurors are coming into the mix.  Law.com editor and blogger Robert J. Ambrogi suggests that the failure to root out and research these bloggers could be legal malpractice.

"As blogger Matthew Wheeler sat in a Milwaukee courthouse this week for jury duty, he amused himself with Twitter postings such as "Still sitting for jury duty crap. Hating it immensely. Plz don't pick me, plz don't pick me," and "More like Jury DEpreciation Month! So this is Purgatory, eh." Unfortunately for Wheeler, he did get picked for what the <i>Milwaukee Journal Sentinel</i>'s Proof and Hearsay blog describes as "the mother of all trials" -- a six-week lead-paint injury case. But at least the lawyers in the courtroom knew of Wheeler's blog and Twitter postings before he was selected. Circuit Court Judge Richard Sankovitz had decided at the outset to ask all potential jurors, "Do you blog?"

Then there is the Chicagoland blogger known only as Erin, who posted earlier this month that "somebody actually put me on a jury" and "i can't wait to decide the lives and deaths of men tomorrow." After Robert W. Kelley wrote about her at his Florida Jury Selection Blog, she answered back with a post captioned, dear members of the florida bar: welcome to my shitty blog. Kelley said that Erin's blog was pointed out to him by jury consultant Amy Singer, who wrote, "This blog post illustrates the necessity of online searching venire panelists for information."

These two recent examples of blogging jurors demonstrate that there is no longer any question of the need for lawyers to ask potential jurors if they are writing online, says another jury consultant, Anne Reed, writing at her blog Deliberations. The question now, she says, is not whether to ask, but how. "There are nearly countless ways a juror could be writing on line," she explains. "You need some sense of the landscape to ask about them, or you'll get partial answers or answers you don't understand." To that end, she offers the first in what she says will be a multipart guide for lawyers to the world of social networking.

As for Erin, her perspective on all this may be the most prescient. Acknowledging the to-do over blogging jurors, she comments:

"okay i didn't write my thesis on psychometrics or anything (yes i did) but i bet if you dismissed every potential juror with some type of internet presence you would end up with range restriction galore. EVERYBODY UNDER THIRTY IS ON THE INTERNET. those are my peers." "

Wisconsin legal malpractice insurers have published a breakdown of legal malpractice claims.  Here, reported by Bonnie Shucha in the University of Wisconsin blog, are the most commonly sued for mistakes:

Calendaring - 23%

Failure to know or properly apply law - 14%

Planning error in choice of procedures - 13%

Inadequate discovery & investigation - 12%

Failure to obtain consent/inform client - 6%

Why calendaring?  It is the easiest to see.  Calendaring mistakes lead to dismissals for failure to appear, which is sublimely easy to comprehend and explain to a judge/jury.

This [and the last?] century seem to be overwhelmingly linked with social changes and legal process.  Law suits have proliferated, there are more lawyers then ever, social change may happen more because of a docket than any other reason.  Here is an example:  the lemon law.  Previously caveat emptor, this simple social protective device has morphed into an industry.

Here is another take on a case we reported yesterday.  A spurious legal malpractice counterclaim and the aftermath.

These attorneys, all former Ohrenstein & Brown lawyers, were tenants of the WTC,   The firm received a big WTC payout.  Who were partners, who were not?  That is the question in this case. 

The common link is that these attorneys all do legal malpractice defense work. 

"In a lawsuit filed last year in Manhattan Supreme Court, former Ohrenstein & Brown partners Annmarie D'Amour, John R. Sachs and Philip Touitou charged that five other partners conspired to keep almost $4 million of the insurance money - a huge windfall for the small firm - for themselves, shutting out the firm's other members (NYLJ, Apr. 28, 2006).

The suit alleges they did this by declaring themselves equity partners and the others non-equity, distinctions the plaintiffs claim had not existed at the firm prior to the arrival of the insurance payout. But the five partners targeted in the suit maintain Ohrenstein & Brown had long operated as a two-tier partnership in which they were the only equity partners and the only ones entitled to the money. The five partners are Manfred Ohrenstein, the former Democratic leader in the state senate; Michael Brown; Christopher Hitchcock; Geoffrey W. Heineman and Abraham Havkins.

Speaking of Sordid settlement techniques, as in the last post, here isa "sharp dealing" estate matter where an attorney was named as executor:

A New Jersey attorney and his client, who last May escaped conviction on charges they unduly pressured an elderly widow to name them as executor and beneficiary of her multimillion dollar estate, now are trying to avoid punitive damages.

A New Jersey appeals court ruled last December that although Ronald Casale and his client, Dr. Ronald Sollitto, could not be forced to pay attorney fees to the beneficiary they effectively disinherited, a jury could still assess punitive damages against them.

Last week, Casale and a lawyer for Sollitto argued to the state Supreme Court that to allow such a remedy would clog the courts and drastically alter the law of trusts and estates.

The case, In the Matter of the Estate of Madeline Stockdale, A-121-06, stems from a challenge to a 2000 will drafted by Casale that named Sollitto, his friend and longtime client, as the chief beneficiary of Madeline Stockdale's estate and Casale the sole executor. The challenger was the Spring Lake First Aid Squad, which under an earlier will would have received most of the estate.

Casale drafted the later will for Stockdale, a nonagenarian, while she was in a rehabilitation facility recovering from a hip fracture. It was executed on Jan. 3, 2000, a day before she had throat surgery.

The same day, Stockdale also signed a real estate contract -- drawn up by Spring Lake, N.J., solo Thomas Foley on instructions from Sollitto -- by which she agreed to sell Sollitto her Spring Lake home for $1.3 million. The contract required only a $1,000 initial deposit, followed by a second deposit of $56,000, with Stockdale taking back a purchase money mortgage for the rest. The will drafted by Casale excused Sollitto's obligation to pay off the mortgage, since as residuary beneficiary the money would go to him anyway.

Settle a big case?  Do it on your own?  Have a little help from inside insurance company employees?  Here is a story of sordid settlement techniques:

"A Texas lawyer indicted for allegedly paying two former employees of The Hartford Financial Services Group Inc. insurance settlement kickbacks has accused the employees of extorting $3 million from him.

Todd Hoeffner, 42, made the accusation in response to a malpractice lawsuit filed against him by his clients. The lawyer accused the two employees of The Hartford of forcing him to pay them $3 million from fees he earned representing 1,000 victims of silicosis. The insurer's employees threatened to block settlements of the cases if he didn't pay the bribes, he alleged.

"Employees of The Hartford held hostage the legal rights of Hoeffner and his clients in a plan calculated to enrich themselves," Chris Flood, his lawyer, wrote in papers filed Monday in federal court in Corpus Christi, Texas.

In June, Hoeffner was, himself, charged with bribing two former Hartford claims handlers, Rachel Rossow, 41, of Redding, and John Prestage, 36, of Newington. The three planned to share attorney's fees obtained from more than $34 million in settlements for Hoeffner's clients, the government alleged. His clients were exposed to lung-destroying silica dust in their jobs as sandblasters and foundry workers.

Hoeffner, Rossow and Prestage have been charged with conspiracy, mail fraud, wire fraud, conspiracy to commit money laundering and money laundering. "

The New York Court system is Byzantine.  There is Supreme Court, Civil Court, District Court, County Court, Surrogate's Court, and so on.  Where to bring an action?  In Civil Court, of course, the upper limit of jurisdiction is $ 25,000.  In Supreme Court, unlimited.  Defendant attorneys here brought a car case in Civil court, and now have lost summary judgment on whether that was legal malpractice.  Still to come?  Whether there was proximate cause and whether plaintiff passed the car accident threshold. Ironicallythis case too ended up in Civil Court.

David v. Mallilo & Grossman, 300574 TSN 2006 ,decided: September 26, 2007
Judge Manuel J. Mendez ,NEW YORK COUNTY Civil Court

Judge Mendez
OPINION OF THE COURT

"Upon a reading of the foregoing cited papers on this motion for partial summary judgment on liability and this cross motion for summary judgment dismissing the complaint it is the decision and order of this court that the motion is granted to the extent of finding defendants negligent as a matter of law, the cross motion is denied.

FACTUAL BACKGROUND

Plaintiff brings this legal malpractice action against the defendants for their failure to file a summons and complaint in the Supreme Court of the State of New York, thereby depriving them of the ability to obtain a significant monetary amount In damages for the injuries they sustained in a motor vehicle accident on January 25, 2003.

Plaintiffs are husband and wife. On January 25, 2003 plaintiff Steven David was operating his motor vehicle in which plaintiff Rosalie David was a passenger. While their vehicle was stopped in traffic it was struck in the rear by another vehicle, causing their vehicle to strike the vehicle in front and allegedly causing Rosalie David serious physical injuries, requiring surgery. Mrs. David was taken by ambulance from the scene of the accident to a local hospital where she was treated at the emergency room and later released. She was given pain killers and told to visit with her physician. Since she was in pain she visited her orthopedist, Dr. Jacob Rozbruch, on January 28, 2003.

Dr. Rozbruch had seen Mrs. David for an injury she had sustained to her right shoulder on January 20, 2003, five days before the automobile accident, when she tripped and fell on her right shoulder. When she visited him on January 28, he ordered an MRI which revealed a "full thickness tear of the rotator cuff" in the right shoulder. He suggested surgery to repair the injury, which was performed on February 6, 2003.

Plaintiffs contacted defendants approximately one week after the accident and retained them to prosecute their claim. Defendants were aware of the injuries sustained by Mrs. David, of the need for surgery to repair the injury and of the actual surgery performed on February 6, 2003. Despite knowing this, defendants filed their summons and complaint on June 27, 2003 in the Civil Court County of New York, demanding $25,000.00 in damages, thereby limiting Mrs. David to a recovery of $25,000.00 or less for her injuries.

The mistake was discovered during the latter part of the year 2003 and in March of 2004 defendants made a motion in Supreme Court New York county to transfer the action to that court and to increase the demand to $1,000,000.00. The motion was denied by the Hon. Kibbie F. Payne by decision order dated May 14, 2004 in which he stated : "All of the facts on which plaintiff relies in support of the motion were known or available to plaintiff at the time the complaint was served. Thus, because plaintiff has failed to make a sufficient showing by explaining the delay in making the motion, or why the monetary jurisdiction of the Civil Court would be inappropriate under the circumstances, the application is denied . . . accordingly, the application is denied in all respects and the petition is dismissed without prejudice to renewal upon adequate papers." [see Exh D &E plaintiff's papers]. Justice Payne's decision was affirmed by the Appellate Division First Department by memorandum decision dated December 15, 2005 [ See Exh. F & G plaintiff's papers].

Following the denial of the motion and affirmance of the decision, the automobile accident case was settled for $25,000.00. Plaintiffs started this legal malpractice action against defendants by filing a summons and complaint in Supreme Court State of New York, County of New York demanding $750,000.00 for plaintiff Rosalie David and $100.000.00 for Steven David, as the amounts they would have recovered in the automobile accident case if it had been filed in the proper court.

Plaintiffs now move for an order granting partial summary judgment, declaring defendants liable as a matter of law to plaintiffs for legal malpractice, and setting this case down for an immediate trial for the determination of damages. Defendants cross move for an order granting them summary judgment and dismissing plaintiffs complaint. Defendants assert in their motion that plaintiff Rosalie David did not sustain a serious physical injury under New York State Insurance Law § 5102 (d), because it cannot be ascertained if the rotator cuff tear was the result of the trip and fall on January 20, or the automobile accident on January 25, 2003."

Here is a widely reported Federal Circuit Case, Immunocept v. Fulbright & Jaworsky which discusses, in great detail when a legal malpractice case, brought in state court, and removed to district court may become subject to the law of jurisdictions other than the state in which it was brought.

As an example, a legal malpractice case arising from a simple car accident  [which coincidentally has full diversity of citizenship] may be removed to District Court, but will not be subject to Federal law.  In this contra-similar case, which arose under Patent law, and is subject to federal question jurisdiction, federal law will apply.  Here the statute of limitations was implicated.

No decision has been published yet, but Anthony Lin at the NYLJ reports that this legal malpractice case has been dismissed.  It arises from representation of nieces and nephews of holocost victims from the 1930's.

"A Manhattan federal judge has thrown out a legal malpractice suit arising out of competing Holocaust restitution claims.

In 2005, a group of nieces and nephews of Jewish publisher and art collector Gustav Kirstein and his wife Clara, both of whom died in Germany in the 1930s, sued their former lawyer, New York's David J. Rowland, claiming his mistakes caused them to have to share restored property and funds with another claimant.

But in Nordwind v. Rowland, No. 04 Civ. 9725, Judge Donald C. Pogue, sitting by designation in the Southern District of New York from the U.S. Court of International Trade, granted summary judgment to Rowland, finding that the relevant German restitution law would not have permitted the nieces and nephews a full recovery.

After their deaths, the Kirsteins' estate passed to their daughters, Gabrielle Jacobsen and Marianna Baer, both of whom had emigrated to New York, where Jacobsen died in 1957 and Baer died in 1986.

The nieces and nephews retained Rowland in 1998 to represent them in seeking restitution for property lost or seized during Nazi rule. That included a number of art works as well as bank accounts. The nieces and nephews had been assigned Marianna Baer's interest in the Kirstein estate by her daughter-in-law Miriam Reitz Baer.

But Jacobsen's interest passed to her adopted son Godfrey, who died in 1980, naming a woman called Christel Gauger as his sole heir. Rowland determined Gauger held Gabrielle Jacobsen's interest and sought to represent her as well. She would receive a 50 percent interest in property and funds restored to the Kirstein estate, with the other half going to the nieces and nephews. "

Here is a rare case of a legal malprctice/arrest of an attorney for allegedly forging a court order so that his clients would not know that he had forgotten to file and serve a summons and complaint.  Forgetting happens all the time, lying to clients sometimes, forgery rarely, arrests almost never.  The twist?  Clients not hurt!  Complaint may be served 4 years late.  The story:

"Laurence S. Jurman of Dix Hills allegedly forged the name of Supreme Court Justice William Rebolini (See Profile) to a judicial order in a civil lawsuit filed as the result of the dispute, according to a statement issued by the Suffolk County District Attorney's Office in May of this year.

On Wednesday, Mr. Jurman, 40, appearing without counsel, pleaded not guilty to a single count of criminal possession of a forged document in the second degree, a class D felony punishable by 2 1/3 to 7 years in prison. Mr. Jurman was released on his own recognizance by District Judge Paul Hensley (See Profile) and is due back to court on Nov. 19.

Mr. Jurman, who was admitted to the state bar in 1991, allegedly advised his clients, plaintiffs who were dissatisfied with the pace of their lawsuit, that Justice Rebolini on May 4 had denied a motion to vacate a nonexistent default by defendants. He subsequently supplied plaintiffs with a copy of the order purportedly signed by Justice Rebolini.

Mr. Jurman could not be reached for comment Friday night.

The background of Mr. Jurman's arrest is spelled out in a decision handed down last month by Supreme Court Justice Edward D. Burke (See Profile) allowing the plaintiffs more time to effect service of a summons and complaint that had laid dormant since being filed four years ago.

In Yahney v. Wolforst, 16106/03, Justice Burke refused to penalize plaintiffs Jeff and Deborah Yahney for relying on Mr. Jurman.

The decision appears on page 20 of the print edition of today's Law Journal.

"While the court acknowledges the absence of diligence and the extended length of the delay of four (4) years in effecting service upon the defendants, both of these factors are attributable solely to egregious conduct on the part of the plaintiffs' former counsel, which this court will not impute to the plaintiffs," the judge wrote.

He said he was forwarding a copy of his order and supporting papers to the district attorney and the grievance committee of the Tenth Judicial District.

According to the decision, the Yahneys accused Joe and Orsola Wolforst of negligently building a retaining wall and berm, resulting in water damage to the Yahneys' property due to the changed grade of their land.

Around June 2003, the Yahneys retained Mr. Jurman to sue the Wolforsts for monetary damages and a permanent injunction.

On June 10, 2003, a summons and complaint was filed in Suffolk County Supreme Court and an index number assigned. And that is where the legal process ended, Justice Burke said.

"Plaintiffs expected that the defendants would be served with the summons and complaint and that the action would proceed in the normal course," he said. "However, this action remained dormant and without any judicial intervention as the same was not initialized by the filing of a Request for Judicial Information until the interposition of this ex parte application for relief pursuant to CPLR 306-b on September 20, 2007." "

Client hires attorney.  Attorney works on case, very hard, and does a good job?  Other problems arise, such as criminal investigations of client.  Client drops case.  Attorney loses contingent fee.  Can attorney sue client for lost fee?  Here, the case says NO !.

"In a short opinion, the Court rejects the plaintiff law firm’s effort to create a new rule of client liability. The Court explains that the law firm’s legal theory would distort the complex calculus about whether to pursue litigation and “mock[] the idea of client control.” In the instant case, it’s no surprise that the client decided not to pursue civil litigation in the face of multiple criminal investigations and fraud claims, and the client acted within its rights by opting to concentrate its resources and energy on these more serious legal issues. Although the result is “admittedly harsh” to those lawyers who toil away with the expectation of a windfall contingency, that’s just the nature of the game. "

Here is the well known blogger, Day on Torts, writing about legal malpractice causation and proximity.  Another way to put this [in a sports metaphor] "no harm, no foul."

"Causation in Legal Malpractice Cases
Negligence without causation is like a biscuit without country ham (or blackberry jam).

Now, I'm not so sure that juries pay as much attention to the concept as lawyers and judges, but causation is an element of every cause of action in the tort world.

This decision out of Michigan reminds us that causation must be proved in a legal malpractice case. The lawyer blew the deadline for filing a notice of appeal - clearly negligence - but was not found liable as a matter of law because the appeal was denied on the merits. Read the decision in McCabe vs. Miller & Associates, LLP, No. 275498 (MI. Ct. App. October 9, 2007) here. "

An attorney who admittedly commits legal malpractice, in a Michigan case, has his discipline upgrated.  The story:

"An Adrian attorney who admitted mishandling a client’s civil case was slapped with a 30-day suspension for failing to cooperate with a Michigan Bar Association investigation of a complaint filed by the client.

Under an order issued Sept. 11 by the Michigan Attorney Discipline Board, John D. Baker was suspended from practicing law from Wednesday through Nov. 9. The panel’s opinion pointed out that Baker made efforts to correct his error in failing to file a lawsuit in a traffic accident injury case, including a payment of his own funds to the client along with obtaining a $6,000 insurance settlement.

The mishandling of the case warranted only a reprimand, but the Attorney Discipline Board raised the punishment to a suspension “based upon respondent’s complete failure to cooperate with the grievance administrator’s investigation,” the panel’s opinion stated. "

For us, [possible] corruption in land deals in California always brings the memory of Chinatown.  Here is a story of a limestone mine whose proceeds were to fund a retirement account for former Kaiser Steel retirees.  The mine was vauled at more than $100 milliion, yet was sold by the trustees for $ 3.5 million.  Litigagion followed.  the details:

"Parts of a limestone mine meant to secure the futures of Kaiser Steel retirees appear to have been sold off for a fraction of their market value.

The Cushenbury Mine, which supplies the essential component of concrete to the booming construction trade, is thought to be worth hundreds of millions of dollars.

But a parcel expected to produce 80 million tons of high-quality limestone estimated to be worth more than $100 million allegedly was sold to Mitsubishi Cement Corp. in December 2000 for $3.15 million.

Three other parcels were sold to Mitsubishi Cement and another mining company, Specialty Mineral Inc., for a fraction of their value in 2001 and 2003, a lawsuit filed on behalf of the retirees on Sept. 30 alleges. "

In the suit against the two mining companies that bought the land, Redlands law firm Welebir & McCune also sues San Bernardino law firm Gresham Savage Nolan & Tilden.

It accuses two of the firm's lawyers, M. William Tilden and Robert W. Ritter Jr., of legal malpractice, fraud and conflict of interest because their firm allegedly represented both the trust and Mitsubishi Cement in negotiating the land sale.

The firm's legal counsel was unavailable for comment Friday, Gresham Savage spokesman Mark Ostoich said. "

Attorney sues for fees, and the reflex reaction is to couter-punch, or as it is put in pleadings, counter-claim.  No harm in defending oneself?  This NJ case illustrates the dangers.

CUYLER BURK, LLP, Plaintiff-Respondent,   vs. ROBERT M. SILVERMAN, ESQ., Defendant-Appellant. Argued: September 10, 2007 - Decided October 9, 2007: Before Judges Cuff, Lisa and Lihotz.  On appeal from the Superior Court of New Jersey, Law Division, Morris County, Docket No. L-135-03.

 "On January 13, 2003, Cuyler Burk filed a complaint to collect the fees incurred by defendant in the amount of $18,747.94. Defendant filed an answer to the complaint and a counterclaim in which he asserted a legal malpractice claim against plaintiff. On August 19, 2003, Cuyler Burk notified defendant's attorney that it considered the counterclaim frivolous and that it would move for sanctions.


On August 20, 2004, two months after the deposition of his expert, defendant dismissed the counterclaim. Following the submission of a stipulation of dismissal with prejudice of plaintiff's complaint, plaintiff filed a motion for sanctions pursuant to N.J.S.A. 2A:15-59.1 and Rule 1:4-8.


In a written opinion filed on December 22, 2005, Judge Harper held that the legal malpractice counterclaim was frivolous. The judge held that Cuyler Burk was a prevailing party because defendant withdrew his complaint after defendant's expert changed his opinion during his deposition. In other words, "the withdrawal of the complaint was done to avoid anticipated defeat, and as such, it is not a voluntary dismissal, but instead an acknowledgement that the Plaintiff would prevail."


Judge Harper also found that the counterclaim was commenced in bad faith. He found that the evidence was undisputed that Cuyler Burk had made attempts to resolve the case on defendant's behalf and that he dragged his feet frustrating the firm's effort to expeditiously and favorably resolve the case. He characterized the counterclaim as a tactic to frustrate the firm's ability to collect the fees owed to it by defendant. Judge Harper also found that defendant knew or should have known that the counterclaim was "without any reasonable basis in law." Furthermore, the judge found that defendant's contention that plaintiff recommended that he not settle the disciplinary matter is "patently untrue." The judge also found that the affidavit of merit submitted by one attorney and the expert report submitted by another were founded on inadequate and incomplete facts.


Once Judge Harper ruled that Cuyler Burk was entitled to an award of fees and costs, it submitted an affidavit of services in which it sought fees and costs in excess of $105,000. On April 24, 2006, Judge Harper conducted a plenary hearing on the fee request at which Cuyler testified in support of the firm's application ."

We read a blog blurb from Eric Turkowitz at his New York Personal Injury Blog which caught our eye and interest.  He discusses a unique warning letter by the Dozier internet Law firm, and the  potential legal malpractice consequences.

"Some lawyer at an outfit calling itself Dozier Internet Law sent a cease and desist letter on behalf of one of its clients, along with this threat:

Please be aware that this letter is copyrighted by our law firm, and you are not authorized to republish this in any matter. Use of this letter in a posting, in full or in part, will subject you to further legal causes of action.
Right. So Public Citizen, after publishing the entire letter on its website, tossed down the gauntlet on behalf of their client with this repsonse:

By this letter, we are inviting you to test the validity of your theory that the writer of a cease and desist letter can avoid public scrutiny by threatening to file a copyright law suit if his letter is disclosed publicly on the internet.
The writer of the original letter, Donald Morris, seems to have clearly done his client a grave disservice with this stupidity. (I mentioned this the other day in my personal injury law round-up, but thought this chuckleheaded conduct needed its own post.)

 Perhaps his threats have succeeded before, but the result is that the letter, and the claims against his client, are now being re-broadcast across the internet."can only think of two reasons for Dozier to publish such a letter on their site: The first is sheer folly, since it draws yet more attention to the charges against the company they wish to defend.

The second is more troublesome. Is Dozier simply trying to create more controversy, and thus more links to their website and hopefully more business? That will surely be one result of publishing a letter to Public Citizen on their website instead of reaching out to them privately. But this would also raise very troubling issues regarding attorney ethics and legal malpractice since this is seems to me clearly detrimental to their client. I prefer the first explanation -- that it is sheer folly and not an ethical breach -- though a savvy Internet based business must surely anticipate the repercussions to their client of additional commentary on the subject.

There is a certain pressure to try to catalogue the vast world of legal malpractice.  Certainly, the court cases, the news releases about law firms being sued are all fodder...but this story stretches the envelope, no?

"Centerfolds Inc. began operating under an adult-entertainment license in 1995, according to Katherine Schubert-Knapp with the city's Executive Administration Department. In so doing, its owner, Mark Overton, snagged one of only five adult-cabaret licenses allowed under a moratorium the city maintained for more than 18 years, before U.S. District Judge James Robart struck it down in September 2005, finding "that the City's current licensing scheme is unconstitutional." (The moratorium wasn't formally lifted until last June.)

That 2004 warrant is significant for Overton because, two years earlier, he dissolved Centerfolds as a corporation and obtained a new license as a sole proprietor. Under that designation, Overton is personally responsible for any debts incurred by Centerfolds. Gowrylow says some people choose the sole-proprietor route to avoid the costs associated with incorporation. Overton's corporation was maintained by attorney John Hess, who was disbarred in 2001 for legal malpractice, one year before Overton became a sole proprietor. "

There is a certain pressure to try to catalogue the vast world of legal malpractice.  Certainly, the court cases, the news releases about law firms being sued are all fodder...but this story stretches the envelope, no?

"Centerfolds Inc. began operating under an adult-entertainment license in 1995, according to Katherine Schubert-Knapp with the city's Executive Administration Department. In so doing, its owner, Mark Overton, snagged one of only five adult-cabaret licenses allowed under a moratorium the city maintained for more than 18 years, before U.S. District Judge James Robart struck it down in September 2005, finding "that the City's current licensing scheme is unconstitutional." (The moratorium wasn't formally lifted until last June.)

That 2004 warrant is significant for Overton because, two years earlier, he dissolved Centerfolds as a corporation and obtained a new license as a sole proprietor. Under that designation, Overton is personally responsible for any debts incurred by Centerfolds. Gowrylow says some people choose the sole-proprietor route to avoid the costs associated with incorporation. Overton's corporation was maintained by attorney John Hess, who was disbarred in 2001 for legal malpractice, one year before Overton became a sole proprietor. "

This story is all about energy, coal and political connections,  We'll exerpt it for you:

"More than five years after a Boone County jury decided against it in a coal contract dispute, Massey Energy Co. is arguing its resulting appeal today to the state Supreme Court.

The jurors awarded $50 million in damages to Harman Mining and company president Hugh Caperton, a cousin of former Gov. Gaston Caperton.

Post-judgment interest has increased that award daily. It now approaches $76 million. Lawyers for Massey have also asked the justices to consider reducing that component of the judgment, The Associated Press reports.

As it did in a 2006 federal lawsuit, later dismissed, the leading coal producer blamed much of the delay in appealing on a court stenographer who allegedly botched the trial transcript badly after repeatedly failing to deliver it on time.

Harmon alleged that Massey ruined the company after voiding a 10-year sales contract. "Massey contends Harman filed for bankruptcy because of mounting losses at its Grundy, Va., mining operation and other problems that had nothing to do with Massey," AP reports.

The Supreme Court has posted the briefs filed by both sides in the case. The court's web site also hosts streaming video of its motions and arguments dockets.

The pending appeal may prove one of the most-watched of the term, which began Sept. 11.

Massey and its supporters have cited critical comments by Justice Larry Starcher in seeking to remove him from hearing the case.

The other side points both to Justice Elliott "Spike" Maynard's longtime friendship with Massey chief Don Blankenship, and to Blankenship's bankrolling of a multimillion-dollar ad campaign that helped elect Republican Justice Brent Benjamin over then-incumbent Warren McGraw in 2004.

As AP notes, "Massey has since sued the Kentucky law firm that defended it in the Harman case for legal malpractice. The coal company blames the firm for losing a related claim pursued by Harman in Virginia, which yielded a $6 million judgment against Massey."

This case which is being reported [with some glee] by the asbestos defendant [the complaint mentions Lorillard Tobacco Co., however] claims that several law firms that were admitted pro haec vice in Cleveland committed negligence and fraud,  The Legal Pad blog fills out the story:

"If Bay Area plaintiff’s attorney Christopher Andreas never returned to Cleveland, it would probably be too soon. But a former client wants him back so a jury can hear malpractice claims against Andreas and his firm.

In a complaint (.pdf) filed Oct. 3 in an Ohio state court, Jack Kananian, Andreas’ former client, said he was forced to settle an asbestos suit against Lorillard Tobacco Co. at a discount because of “negligent professional misconduct” by Andreas. Kananian also accused Andreas’ firm, Brayton Purcell of Novato and Early, Ludwick & Sweeney, a firm based in New Haven, Conn., of committing malpractice.

“The collective negligent conduct of all named defendants fell below the acceptable standards of skill, care and diligence requisite in the legal representation of a client,” David Forrest, a Cleveland attorney representing Kananian, said in the complaint.

Kananian’s claims appear to be based on a Cleveland judge’s ruling in January that said Andreas and his firm tried to cash in fraudulent asbestos claim forms then lied in court to cover it up, among other lawyerly no-nos. Andreas has denied those allegations. "

Whats the asbestos-tobacco connection?

Hinshaw reports this case: Ellis J. Burnett v. Daryl M. South, Slip Copy, 2006 WL 4497729 (Tenn.Ct.App. 2007)

"Tennessee Appeals Court Concludes Criminal Defendant Client May Bring Legal Malpractice Action Before Seeking or Receiving Post-Conviction Relief . The court held that a criminal defendant who wished to sue his attorney for legal malpractice following a conviction could do so before obtaining relief from the conviction in order to avoid the “Catch 22” situation posed by the one-year statute of limitations for legal malpractice actions. The case may then be stayed to see whether the legal malpractice plaintiff is able to obtain relief from the conviction. "

This case illustrates the difference between legal malpractice claims and overbilling claims.  Ironicly, the defendant law firm concerntrates [specializes?] in legal malpractice litigation.

Gamiel v Curtis & Riess-Curtis, P.C. ,2007 NY Slip Op 07341 ,Decided on October 4, 2007
Appellate Division, First Department 

"Plaintiff's affidavit was conclusory (see Murray Hill Invs. v Parker Chapin Flattau & Klimpl, 305 AD2d 228, 229 [2003]), and failed to set forth the requisite "but for" causation with respect to her legal malpractice claims (see Aquino v Kuczinski, Vila & Assoc., P.C., 39 AD3d 216, 218-219 [2007]), a deficiency not remedied by her attorney's affirmation. However, we find that plaintiff sufficiently set forth the merit of her claims concerning overbilling and the withholding of her files to
preclude summary resolution of those claims (see Batra v Office Furniture Serv., 275 AD2d 229 [2000]). "

This report from Law.Com  tells the story of an international quest for payment on a divorce attorney fee, as well as the underlying monies due from a rich husband to the wife and an attorney.

"Lawyers whose clients refuse to pay their fees routinely file lawsuits and win judgments against them. But attorney Ellen Marshall's disputes with a former divorce client have been anything but routine. Then again, Warren Matthei is no ordinary client.

Matthei, a millionaire stockbroker from Summit, N.J., spent nearly a decade in jail -- first for refusing to pay child support to his ex-wife and later for refusing to pay Marshall's attorney fees. Marshall obtained an $85,000 judgment against Matthei, but court records show she has all but giv