Legal malpractice issues arise in all kinds of settings. in Wikked Entertainment, Inc. v Burbacki  2020 NY Slip Op 32375(U)  July 20, 2020 Supreme Court, New York County Docket Number: 652352/2018 Judge: Andrew Borrok the setting is a claimed hiring of a niece as an attorney to a talent management agency, and the claimed attempted take-over of the agency.  Maria Carey was the sole client, and that relationship ended badly.

“According to the Amended Complaint, in January 2016, Stella Stolper hired her niece, Zarina Burbacki, an attorney licensed to practice in New York, to work for Ms. Stolper’ s management and production company, Wikked Entertainment, Inc. (Wikked) as its in-house counsel and Chief of Staff (Am. Compl., iii! 2-8). Ms. Stolper also helped Ms. Burbacki’s husband, Yonatan Shimrony, get a job in the entertainment industry (id., iJ 10). However, within a few months after Ms. Burbacki began working for Ms. Stolper at Wikked, Ms. Burbacki and Mr. Shimrony created their own, competing companies called YoZa Consulting LLC (Y oZa) and 345 Consulting LLC (345 Consulting), for the purpose of poaching Wikked’s clients and diverting business opportunities for their own benefit (id., iJiJ 13-15). ”

“Ms. Stolper also details allegations concerning Ms. Burbacki’s attempts to wrest control of Ms. Stolper and Wikked’s finances from Ms. Stolper. In one example, she alleges that, acting as Ms. Stolper’s personal attorney, Ms. Burbacki advised Ms. Stolper to set up two trusts in California to safeguard her assets (id., i123). Ms. Burbacki then allegedly set up the trusts and named herself and Mr. Shimrony as the trustees in a scheme designed to give them complete control over Ms. Stolper’s assets (id.). Ms. Stolper asserts that Ms. Burbacki, who was not licensed to practice law in California and had no knowledge of California law, misrepresented the need for the trusts and the benefits of structuring them in such a way as to give Ms. Burbacki and Mr. Shimonry complete control (id.). In another example, Ms. Stolper alleges that Ms. Burbacki convinced Ms. Stolper to put her funds in an attorney escrow account, but after a few months, she stopped providing a formal accounting and withheld $125,000, which Ms. Stolper claims Ms. Burbacki kept for herself (id., iii! 31-37). ”

“Ms. Burbacki’s argument fails because although Ms. Stolper and Ms. Carey released each other and each other’s lawyers (NYSCEF Doc. No. 88, § 4 [emphasis added]), they did not release claims against their own lawyers. The plain meaning of the language of the Mutual Release is that there was no release as to any claims that each party might have against its own lawyers (Elias v Gettry Marcus CPA, P.C., 2018 WL 3117510 at *4 [SD NY, June 25, 2018, 17 Civ. 4066 (ER)] [“The most natural reading of this language is that the parties intended to release each other and those individuals acting as the counterparties’ agents, not that the parties intended to release claims against their own agents.”]). Put another way, Ms. Stolper released any and all claims against Ms. Carey and Ms. Carey’s lawyers, and Ms. Carey released any and all claims against Ms. Stolper and Ms. Stolper’s lawyers, but they did not release any claims that either of them may have as against their own lawyers. For the avoidance, to the extent that Ms. Burbecki argues that there is no carve-out of her from the release, it is of no moment because, for the reasons set forth above, Mr. Stolper’s release language does not cover her or any of her own employees in the first instance. In other words, the absence of a carve-out does not expand the language of the release itself. Accordingly, the Mutual Release is not a bar to Ms. Stolper’s claims in this action. ”

“Here, Ms. Stolper alleges that “[i]n the course of their employment as Ms. Stolper’s and Wikked’s attorneys, Burbacki consistently committed malpractice by either negligently and
improperly performing legal tasks or by negligently failing to perform necessary and required legal tasks” (Am. Compl, iJ 70). Specifically, Ms. Stolper alleges that (i) Ms. Burbacki
intentionally misrepresented her legal knowledge and experience (id., iJ 16), (ii) Ms. Burbacki represented that she was working on securing certain patents and trademarks that were necessary in connection with a skin care product line that Ms. Stolper planned to launch, but that she failed to take the necessary actions to obtain them and, as a result, the product line never launched (id., iii! 18-21), (iii) Ms. Burbacki served as Ms. Stolper’s personal lawyer but failed to provide herwith a written retainer letter as required under New York law (id., iJ 22), (iv) Ms. Burbacki misrepresented her knowledge and understanding of California law and lacked the legal acumen to perform the services that she was entrusted to perform, including advising Ms. Stolper on the benefits of setting up trusts in California and giving total control to Ms. Burbacki and Mr. Shimonry, and (v) Ms. Burbacki mismanaged the attorney escrow account by comingling and then converting Ms. Stolper’s funds (id., iii! 33-35). Taking these allegations as true and according them the benefit of every favorable inference, Ms. Stolper has sufficiently stated a cause of action for legal malpractice. Therefore, the motion to dismiss is denied as it relates to the fourth cause of action.”