Law.Com reports that the Wiley Rein legal malpractice case has been dismissed. This was a case with major players: "The Wiley team that defended Blackwater in the underlying case consisted of Fred Fielding, now White House counsel; Barbara Van Gelder, now a partner at Morgan, Lewis & Bockius; Scott McCaleb, still a partner at Wiley; and Margaret Ryan, now a judge for the U.S. Court of Appeals for the Armed Forces. Blackwater’s malpractice suit named Ryan as a separate defendant because, according to the complaint, she led the defense team."

Blackwater is a major player in the Iraq war, and this case involved a wrongful death in Fallujah.  Images of Blackwater contract employees being dragged behind trucks through the streets was a strong and sickening sight..

"Blackwater sued the Washington law firm in January, alleging that Wiley lawyers neglected critical case law and statutes while defending it in a 2005 wrongful death case brought on behalf of four Blackwater guards brutally killed in Fallujah, Iraq, in 2004. "

"In the malpractice complaint, Blackwater argued the wrongful death suit would have been dismissed if it were heard in federal court, where the defense could have relied on similar cases where claims against battlefield contractors were thrown out. But the 2005 case was kept in Wake County Superior Court in North Carolina, despite a motion filed by the Wiley team to get it moved to the U.S. District Court for the Eastern District of North Carolina. The malpractice complaint alleged the motion failed predominantly because the Wiley lawyers didn’t invoke the federal officer removal statute, which gives federal jurisdiction to claims involving federal officers.

Wiley’s motion to dismiss the malpractice suit argued that Blackwater could not have been considered a "federal officer" in the underlying case because the guards who were murdered did not contract directly with the U.S. government, were not providing security for U.S. military personnel, and were not overseen by the U.S. military.

In her five-page order, Retchin said Blackwater’s claim that it was entitled to remove the wrongful death case to federal court under the federal officer removal statute where "dismissal was the only appropriate remedy" were "legal conclusion[s] couched as factual allegation[s]."

A frequent defense in legal malpractice is that while a mistake has been made, plaintiff is not hury anyway.  Here is one example of that defense in a New Jersey Case.  THE MAKE UP BAR, Inc.
Plaintiff-Appellant, vs. COOPER, LEVENSON, APRIL, NIEDELMAN & WAGENHEIM, P.A., and ROBERT E. SALAD, ESQ.,

A hair stylist is hired by plaintiff, and plaintiff asks its attorney to prepare a "no-hire" agreement.  Instead, a "no-solicitation" agreement is prepared.  Is there a difference?

"Severino, a hairdresser, claims that she retained attorney Salad to draft a "no-hire" agreement for execution by Scerati, a hairdresser whom she had agreed to employ for a short period until his own salon, Blink Spa, was opened. Instead, she claims Salad drafted a "non-solicitation" agreement, which proved effectively unenforceable when, in an injunctive action filed by The Make-up Bar against Scerati in the Chancery Division after four of The Make-up Bar’s employees had found employment at Scerati’s salon, each certified that he or she had not been solicited by Scerati. Scerati corroborated the employees’ position in his own certification, and he stated additionally that he would not have signed a no-hire agreement if it had been presented to him. The action filed against Scerati was dismissed without prejudice with Severino’s consent.

In its complaint, plaintiff simply alleged that it "suffered damages" and "substantial business losses" as a result of defendants’ failure to draft an appropriate agreement that would enjoin Scerati from hiring plaintiff’s employees for a certain period of time. In support of its claim, plaintiff provided a single-page submission of handwritten calculations that purported to identify the revenue generated by the four employees during 2001 and 2002. Plaintiff’s only expert, attorney Barry E. Levine, provided a report completely devoid of any assessment of damages. Levine testified that he was unaware of the attrition rate of beauty salon employees and that he had performed no investigation into the matter, formal or otherwise. Further, neither Severino nor Levine, as lay and expert witnesses, produced evidence of the specific business diverted to the other salon by its hiring of plaintiff’s four former employees. Plaintiff failed to identify which customers, if any, followed the employees to the other salon and which customers continued to patronize it. Moreover, plaintiff did not commission any analysis or comparison of profits generated or clients lost before and after the employees left plaintiff salon. In opposition to defendants’ motion, plaintiff merely set forth that it was damaged in the amount noted in Severino’s handwritten exhibit.

Plaintiff filed its complaint for legal malpractice on February 13, 2004. Following the reversal of the first summary judgment and remand to the trial court, defendants renewed their motion for summary judgment after additional discovery. As in its first motion for summary judgment, defendants conceded for purposes of the motion that they failed to prepare the agreement that Severino requested. In support of their motion, Scerati certified that he would not have signed a more restrictive agreement. "

This article from the Southeast Texas Record amplifies the current debate there over mandatory disclosure of legal malpractice coverage.  "There’s a movement in Austin to change this. Last week, a state Supreme Court task force voted down a measure to require Texas lawyers who don’t carry malpractice insurance to tell potential clients beforehand. Supporters plan to keep trying; next month they’ll take their idea to the Texas Bar’s Board of Directors."

"Predictably, lawyers are crying foul. In a lawyer poll–80,000 are licensed to practice law in Texas–70 percent opposed the idea, using arguments that wreak of irony if not hilarity.

Some lawyers contend letting clients know they are insured will prompt clients to–get this–sue them.

"It’s.. like painting a target on your back," complained Plano attorney Charles Awalt, as quoted in the Austin American-Statesman.

Then there’s the cost. Paying a few hundred to a few thousand dollars per year in premiums, many solo practitioners say they cannot afford to insure themselves and stay in business. "

This case illustrates how difficult it may be to prosecute a Judiciary law 487 case in a legal malpractice setting.  Sara Kinberg, Plaintiff-Appellant, v Heidi Opinsky, Defendant-Respondent.
SUPREME COURT OF NEW YORK, APPELLATE DIVISION, FIRST DEPARTMENT , 2008 NY Slip Op 4616Decided May 22, 2008.

We have seen unsuccessful 487 cases with allegations of forged wills  which were filed with the surrogate.  Here, the court did not discuss the specific evidence before it,

"The record shows that plaintiff failed to demonstrate that defendant committed negligent acts but for which plaintiff’s 1992 matrimonial action, which plaintiff ultimately settled in 2000 after having discharged defendant, would have ended more favorably to her (see e.g. Tanel v Kreitzer & Vogelman, 293 AD2d 420, 421 [2002]). Moreover, in two causes of action, plaintiff fails to plead any demand for compensatory damages, and her demands for punitive damages are unsupported by evidence that would warrant such relief (see Gamiel v Curtis & Riess-Curtis, P.C., 16 AD3d 140, 141 [2005]). Plaintiff’s cause of action alleging that defendant violated Judiciary Law § 487 is not viable, as the requisite evidence of a "chronic and extreme pattern of legal delinquency" is not found in the record (see Nason v Fisher, 36 AD3d 486, 487 [2007], quoting Solow Mgt. Corp. v Seltzer, 18 AD3d 399, 400 [2005], lv denied 5 NY3d 712 [2005]). [*2] "

An unrelated article in the NYLJ related a cycle in the franchising industry yesterday…from settlement by litigation, through resolution by arbitration, and then on to wide-scale mediation.  Legal malpractice may well be following the same cycle.  As the California Attorney’s Fees Bl;og reports, arbitration is the thing in California. 

"First, the appellate court found the retainer agreement, while only talking about representation in the first lawsuit, had saving language to cover the second lawsuit. The fee agreement expressly stated “[a]dditional matters that we agree to undertake will be under the same terms as stated in this letter unless otherwise agreed in writing.” Unlike the trial court, the Court of Appeal found nothing ambiguous about this language, having the power to reverse because interpretation of a written arbitration agreement is a judicial function.

Next, the Second District, Division 2 turned to the unconscionability determination. It found no procedural unconscionability because the parties simply entered into a business relationship, a far cry from employment relationships that have spawned more rigid protections. (Contrasted with Armendariz v. Foundation Health Psychcare Services, Inc., 24 Cal.4th 83 (2000) [certain additional “badges of fairness” for arbitration clauses required in employment situations].) The appellate court pragmatically noted there happen to be no shortage of attorneys, such that the clients could have simply gone elsewhere. It also had no sympathy for the unsophistication argument, which was based on the premise that the clients did not read the agreement—the law usually requires this diligence, the Second District wrote. The Court of Appeal also rejected the argument that there needed to be magic “read and understood” terminology, noting that the fee agreement did have “carefully look over before signing” language and a conspicuous “AGREED” signal above the signature lines of a sufficiently clear nature. "

The substantive unconscionability finding was also found unsatisfactory on appeal. Because this case involved private rights (a legal malpractice action) rather than a one involving public rights (such as an employment relationship), there is no additional requirement of guaranteeing the right to discovery in the arbitration forum.

The result: the parties were ordered to arbitrate, as the written fee agreement required them to do.

Do you understand Chapter 11 Bankruptcy practice?  Can you define "cram down" or "impaired class" or "non-recourse loans"?  We can’t, but this case is a primer in Chapter 11 practice and the legal malpractice which may arise in a case.

The facts are complicated, involve general and limited partnerships, non-recourse loans, cross-collateralization and multiple state litigation.  Read the entire matter Breslin Realty Dev. Corp. v Shaw 2008 NY Slip Op 50887(U) Decided on April 21, 2008 Supreme Court, Nassau County .

"Plaintiffs’ motion for leave to reargue and leave to renew a prior motion by defendant which resulted in an order dated September 28, 2007 granting summary judgment dismissing the complaint and upon reargument for an order denying such relief is granted. Defendants’ cross-motion for leave to reargue is also granted, but upon defendants’ motion for reargument, the court adheres to so much of its prior decision as denied defendants’ motion for summary judgment on the grounds of lack of standing and res judicata/collateral estoppel.

This is an action for legal malpractice. Defendants were counsel to the plaintiff debtors in a series of jointly administered Chapter 11 bankruptcy proceedings."

This case from New Jersey illustrates the border line between behavior that is so bad that an expert is not needed at trial to testify on whether there was a deviation, and behavior that is bad, but still requires an expert.  The NJ court found in TARUTIS, v. ALAN ACKERMAN and GREGORY WISOTSKY,  that:

"No expert is needed "where the questioned conduct presents such an obvious breach of an equally obvious professional norm that the fact-finder could resolve the dispute based on its own ordinary knowledge and experience and without resort to technical or esoteric information." Brach Eichler, supra, 345 N.J. Super. at 12. For example, no expert testimony was required when the attorney entirely failed to submit a legal argument in his client’s defense, Sommers v. McKinney, 287 N.J. Super. 1, 8-12 (App. Div. 1996), or where the attorney failed to comply with the controlling statute of limitations, Brizak v. Needle, 239 N.J. Super. 415, 429, 431-33 (App. Div.), certif. denied, 122 N.J. 164 (1990). "

But, where the defendant attorney  "did not retain an expert to testify to the coefficient of friction of the floor, nor did he propound interrogatories, depose any witnesses, request documents, or request admissions from Resorts" the legal malpractice client still needs an expert to testify that the attorney was negligent.

The politicians are in Iowa, the primaries started there, and today we report on a legal malpractice and recusal case in Iowa.  Here two different strands of problems for the legal malpractice plaintiff are twisted together.  One of the strands concerns the judges comment about the legal malpractice plaintiff and defendant:  "one is dishonest, and I had lunch with the other."

The second strand is more technical.  if a court finds that an attorney’s work was "ineffective" need the plaintiff then offer an expert to say the attorney was negligent?  So, far the court says, "not yet."

See the case for details. Hanish v. Bracker