Suing the Other Guys Attorney is Never Easy in Legal Malpractice
The "frozen out" minority loses a corporate cause of action - contract case, and believes that the attorneys for the majority colluded with the majority to freeze them out. They believe that the attorneys helped the majority to breach fiduciary duties. They felt that there was sufficient evidence to support a claim for legal malpractice against the other party's attorneys. Their case was dismissed on summary judgment , and in Aranki v Goldman & Assoc., LLP 2012 NY Slip Op 04117 Decided on May 30, 2012 Appellate Division, Second Department the dismissal was affirmed.
"Absent fraud, collusion, malicious acts, or other special circumstances, an attorney is not liable to third parties not in privity or near-privity for harm caused by professional negligence" (Fredriksen v Fredriksen, 30 AD3d 370, 372; see AG Capital Funding Partners, L.P. v State St. Bank & Trust Co., 5 NY3d 582, 595). Here, the defendants established that they did not collude with the majority members of Millennium Alliance Group, LLC (hereinafter MAG), inter alia, to freeze the plaintiffs out of MAG's management and profit sharing and force them to surrender, at a reduced price, their minority membership interest in MAG. Thus, the defendants established their entitlement to judgment as a matter of law dismissing the cause of action alleging legal malpractice. In opposition, the plaintiffs failed to raise a triable issue of fact.
The defendants also established their entitlement to judgment as a matter of law dismissing the cause of action alleging breach of fiduciary duty by showing that they did not knowingly induce the majority members of MAG to breach their fiduciary duty to the plaintiffs (see Kaufman v Cohen, 307 AD2d 113, 125). In opposition, the plaintiffs failed to raise a triable issue of fact. "