Legal malpractice is ubiquitous. All social classes are potential litigants, and almost every human endeavor (which interact with the law) will have incidences of legal malpractice. We are reminded of the New Yorker cartoon in which a small boy cries over a dropped ice cream cone, and a suited man asks "Do you need an attorney, little boy?"
This nobel laureat did need an attorney, and it turned out badly. Now it heads to legal malpractice litigation. Today’s NYLJ, in an article by Zoe Tilman, writes:
"Rita Bank, a well-known Washington, D.C., divorce attorney, has been litigating unhappy break-ups for more than a quarter-century. But next month, the family law heavyweight will find herself in court over an unamicable split with a renowned former client.
Ms. Bank is facing a $5 million legal malpractice lawsuit from Joseph Stiglitz, a New York-based Nobel laureate in economics, who is claiming that Ms. Bank gave him counsel that left him financially vulnerable in the divorce proceedings and failed to promptly tell him about merger discussions she was having at the time with his ex-wife’s attorney.
Ms. Bank, a co-partner at Ain & Bank, has denied any wrongdoing. She referred questions to her attorney, Richard Simpson of Wiley Rein in Washington, D.C., who called the lawsuit "meritless." "Everything was handled exactly as the ethics rules say they should be handled," he said.
The case was scheduled to go to trial before U.S. District Judge Richard Leon in 2008, but was rescheduled a half-dozen times during the past three years because of scheduling conflicts and motions detours. For instance, Mr. Stiglitz, a Columbia University economics professor, argued unsuccessfully that he should be allowed to testify as a damages expert, given his background.
The trial is scheduled to begin June 21 in U.S. District Court for the District of Columbia.
Mr. Stiglitz hired Ms. Bank in 2000, shortly after he had separated from his second wife, Jane Hannaway. At the time, Ms. Bank was with Feldesman Tucker Leifer Fidell in Washington, D.C.
From the beginning, Mr. Stiglitz claims that Ms. Bank failed to follow his wishes to file suit as soon as possible. Mr. Stiglitz notes in his complaint that when divorce negotiations began, he knew that he was under consideration for the Nobel Prize in economics and wanted to prevent Ms. Hannaway from laying claim to any subsequent award or income.
Mr. Stiglitz has accused Ms. Bank of giving him misinformation throughout the divorce negotiations. At the onset, Mr. Stiglitz claims that Ms. Bank failed to tell him that in the District of Columbia assets can be considered part of the marital estate until the divorce trial. Instead, he alleges, she told him that if he deposited new income in a separate bank account, it would be off limits when it came time to divide the estate.
When Mr. Stiglitz relocated from Washington to New York in 2001, he claims Ms. Bank then failed to advise him on the differences in matrimonial law between the two jurisdictions that might have led him to reconsider the move. After Mr. Stiglitz received the Nobel Prize in 2001, he says Ms. Bank failed to tell him that his "celebrity status" could open the door to larger earnings claims from Ms. Hannaway if the case proceeded in New York."