We can’t read the case, and a subscription to the Minnesota lawyer site is required, but third-hand, here is an interesting take on a legal malpractice case from the Minnesota Lawyer Blog.

"Minnesota Lawyer has an interesting story this week about a local attorney who found himself being sued for malpractice in Kentucky by a woman who claimed that she was his client.  The woman was mulling filing a medical-malpractice suit against the decedent’s health-care providers, and for reasons that are unclear contacted the Minnesota attorney. She filed out his retainer agreement and returned it, but the two had no further contact. The attorney officially declined the case in a letter sent several months later, shortly after the expiration of the applicable Kentucky statute of limitations on the estate’s med-mal claim.

Minnesota Lawyer Blog’s take on the case is puzzlement.  "In the meantime, you may want to be careful about whom you give a copy of your retainer agreement to … "

A different take?  Attorney is retained to handle a medical malpractice case, and a written retainer is signed by the client.  Attorney holds onto the case until the statue of limitations has passed and then tells the client that he is not interested in the case.  Attorney may not have know of Kentucky’s statute of limitations, but he has allowed the statute to pass.

It is rare to depose opposing counsel.  Here is an interesting case in which the question to be determined is whether plaintiff knew his union would not participate in a discrimination case, and if so, whether the statute of limitations had passed.

From Wilmer Cutler Pickering Hale and Dorr LLP :

"The Southern District of California ordered the deposition of Plaintiff’s attorney after finding that he had information crucial to Defendant’s statute of limitations defense, and that the information could not be otherwise obtained. Pastrana v. Local 9509 Commc’ns Workers of Am., No. 06cv1779 W (AJB), 2007 U.S. Dist. LEXIS 73219 (S.D. Cal. Sept. 28, 2007).

Plaintiff brought suit against Local 9509 after he was fired from his job with AT&T, and the union declined to appeal his grievance to arbitration. Id. at *3. Local 9509 raised the six-month statute of limitations as a defense to Plaintiff’s claim that it had breached its duty of fair representation. Thus the date by which the union notified Plaintiff and his attorney that it would not appeal was significant. Id. at *3-4.

If Plaintiff had been given notice by the union prior to February 28, 2006, his claim, brought on September 1, would be untimely. Id. at *4. Defendant claimed that a union employee had informed Plaintiff and his attorney via several teleconferences in February 2006 that it would not pursue his grievance to arbitration; Plaintiff disputed this account and offered a Declaration of his counsel that these teleconferences had not occurred until March 2006. Id. at *4. Defendant filed a motion to compel the deposition of Plaintiff’s counsel on the grounds that he was the only person besides Plaintiff and a union employee to participate in those conversations. Id. at *4-5. Defendant also moved to compel the production of any notes Plaintiff’s attorney took during those conversations. Plaintiff opposed the motion and moved for a protective order on the grounds that the testimony and documents sought were protected by the attorney-client privilege and work product doctrine. Id."

It’s the very rare case in which an expert is not needed in a legal malpractice case.  Here is a SDNY case in which the expert was necessary.  How could this attorney not have used an expert on a motion for summary judgment?

YAMIRA SANTIELI, Plaintiff, v. LAWRENCE M. LAPINE, Defendant.
3:05cv1712(WWE)
UNITED STATES DISTRICT COURT FOR THE DISTRICT OF CONNECTICUT
2008 U.S. Dist. LEXIS 28251
March 26, 2008, Decided

"To recover on a claim of legal malpractice, plaintiff must establish (1) the existence of an attorney-client relationship; (2) the attorney’s wrongful act or omission; (3) causation; and (4) damages. Plaintiff must produce expert testimony that a breach of the professional standard of care has occurred, and that the breach was a proximate cause of the injuries suffered by the plaintiff. Dixon v. Bromson and Reiner, 95 Conn.App. 294, 297-98, 898 A.2d 193 (2006); Solomon v. Levett, 30 Conn.App. 125, 128, 618 A.2d 1389 (1993). In malpractice cases, expert testimony serves to assist lay people, such as members of the jury and [*4] the presiding judge, to understand the applicable standard of care and to evaluate the defendant’s action in light of that standard. Vona v. Lerner, 72 Conn.App. 179, 187, 804 A.2d 1018 (2002).

Plaintiff makes no representation that she intends to disclose an expert witness and she has filed no motion to do so. Rather, she argues that this case falls within the exception to the expert witness requirement where there is "such an obvious and gross want of care or skill that the neglect is clear even to a layperson." Davis v. Margolis, 215 Conn. 408, 416 n. 6, 576 A.2d 489 (1990).

An expert may not be necessary when the legal malpractice involved a failure to follow rules of procedure, such as filing motions or attending hearings. See Dubreuil v. Witt, 80 Conn.App. 410, 422, 835 A.2d 477 (2003). However, the instant case does not involve an obvious and gross want of care that would be clear to a lay person. Here, assessment of whether defendant breached the standard of care requires expert testimony as to the division of marital assets and the advice provided by defendant. Accordingly, summary judgment is appropriate."

It appears certain that they gave bad tax shelter advice, but this plaintiff opted out of a successful class action only to see his own case dismissed,

EDWARD H. ARNOLD, Plaintiff, -against- KPMG LLP, and SIDLEY AUSTIN BROWN & WOOD LLP, Defendants.

05 Civ. 7349 (PAC)
UNITED STATES DISTRICT COURT FOR THE SOUTHERN DISTRICT OF NEW YORK
2008 U.S. Dist. LEXIS 25855
March 28, 2008, Decided
March 28, 2008, Filed
Plaintiff Edward H. Arnold ("Arnold") brings this action against Defendants KPMG ("KPMG"), an accounting firm, and Sidley Austin Brown & Wood ("Brown & Wood"), a law firm, for damages allegedly suffered when he bought tax shelters from KPMG with Brown & Wood’s endorsement. The tax shelters, which were effectuated through the purchase and sale of securities, were designed to offset Arnold’s income but were determined to be unlawful tax-avoidance schemes.

The Court held oral argument on the matter on March 6, 2008. [*3] (Transcript of Oral Argument, March 6, 2008 ("Tr.").) The Court ruled that: (1) Arnold’s federal securities claims are time-barred by operation of the relevant statute of limitations (Tr. at 7-11); and (2) Arnold’s numerous state law claims merge into single claims for professional malpractice against each defendant (Tr. at 11-12). In light of these holdings, the Court heard oral argument as to: (1) whether the Court should exercise supplemental jurisdiction over the state law malpractice claims in light of the dismissal of the federal claims, and (2) whether the state law malpractice claims are time-barred under the statute of limitations. The Court now exercises its supplemental jurisdiction over the state law malpractice claims and dismisses them as time-barred.

In this case, Defendants argue that the three-year statute of limitations accrued when the opinion letters were issued. Arnold contends that because the fraudulent scheme was continuous, the claim did not accrue against either Defendant until KPMG revealed its fraudulent conduct by entering into a deferred prosecution agreement with the Department of Justice in August 2005. In the alternative, Arnold argues that the statute of limitations was tolled.

The Court rejects the argument that the appropriate date of accrual was August 2005; the claim for malpractice accrued when each Defendant issued its opinion letter.

In re D.A. ELIA CONSTRUCTION CORP., Plaintiff, v. DAMON & MOREY, LLP, Defendant.

07-CV-143A
UNITED STATES DISTRICT COURT FOR THE WESTERN DISTRICT OF NEW YORK
2008 U.S. Dist. LEXIS 25496
March 31, 2008, Decided
March 31, 2008, Filed

“While the matter [the bankruptcy matter] was on appeal to the Second Circuit, Elia filed a complaint against Damon & Morey on February 14, 2007 in New York State Supreme Court asserting [*5] various state law causes of action relating to the firm’s legal representation of Elia during the Chapter 11 proceeding. Specifically, the complaint alleges breach of a legal retainer agreement (first cause of action); legal malpractice (second cause of action); conversion (third cause of action) and attorney misconduct in violation of § 487 of the New York State Judiciary Law (fourth cause of action).”

“In Grausz v. Englander, 321 F.3d 467 (4th Cir. 2003), the Fourth Circuit addressed whether a legal malpractice claim brought after the entry of a final order approving fees under 11 U.S.C. § 330 was barred by the doctrine of res judicata. The Court held that it was because the "legal malpractice claim [was] rooted in the same cause of action as the earlier claim for [attorneys’] fees." Id. at 473. Likewise, the First and Fifth Circuits have also considered this issue and held that HN9 state law malpractice claims brought after the entry of a final order approving 11 U.S.C. § 330 fees are barred by the doctrine of res judicata. See In re Iannochino, 242 F.3d 36 (1st Cir. 2001); In re Intelogic Trace, Inc., 200 F.3d 382 (5th Cir. 2000); see also In re Robotic Vision Sys., Inc., 343 B.R. 393 (D.N.H. 2005); In re Blair, 319 B.R. 420 (D. Md. 2005) In so ruling, [*13] the Circuits considered whether the plaintiff knew or should have known about the basis of its malpractice claim at the time that attorneys fees were approved and whether the bankruptcy court provided an effective forum to litigate those claims. See Grausz, 321 F.3d at 473-74; In re Intelogic Trace, 200 F.3d at 388.

As in Grausz and Intelogic, all of the misconduct alleged to have been committed by Damon & Morey was known to Elia at the time that the bankruptcy court approved the final fee application. In fact, many of the same allegations made by Elia in its state law complaint were previously made by Elia in its objections to Damon & Morey’s final fee application. Specifically, Elia argued to the bankruptcy court that the firm had labored under a conflict of interest, had committed legal malpractice and had failed to turn over money owed to the estate. The bankruptcy court provided Elia with ample opportunity raise those claims, but ultimately rejected them as meritless. Both this Court and the Second Circuit have expressly determined that the bankruptcy court gave adequate consideration to Elia’s allegations of malpractice. See In re Elia, 04-cv 975, Dkt. No. 21 (this Court’s order [*14] affirming bankruptcy court’s award of § 330 fees and finding that bankruptcy court considered but rejected the malpractice allegations); and id. at Dkt. No. 33, at 3 and 4 (Second Circuit’s Summary Order determining that the bankruptcy court gave Elia "more than ample opportunity to present its arguments" regarding its claims of "conflicted and negligent representation"). As such, it cannot be said that Elia was denied the opportunity to raise these claims in the prior action. 4”

ANDREW ORDON, Plaintiff-Appellant, -v.- KAREN L. KARPIE, and MURPHY & KARPIE, LLC Defendants-Appellees.

No. 06-3347-cv
UNITED STATES COURT OF APPEALS FOR THE SECOND CIRCUIT
2008 U.S. App. LEXIS 7626
April 10, 2008, Decided

“Ordon retained Karpie to represent him in proceedings before the Connecticut Medical Examining Board ("CMEB") after a patient reported to the Connecticut Department of Public Health ("CDPH") an adverse result in a surgery performed by plaintiff. Plaintiff alleges that Karpie advised him to settle the charges against him with the CDPH and accept a Consent Order and fine rather than proceed to a CMEB hearing, but that in doing so she negligently failed to inform him that he might be subject to disciplinary action by licensing authorities in other states pursuant to reciprocal discipline statutes. Plaintiff further alleges as consequences of the settlement that (1) his medical licenses in New York and California were subject to reciprocal disciplinary proceedings; (2) he was unable to obtain malpractice insurance and hospital accreditation for six months in California; (3) he lost income; (4) he suffered from depression; and (5) he became physically disabled as a result of stress-induced carpal tunnel syndrome.”

“Plaintiff’s action fails under a theory of legal malpractice as well. HN3 "As a general rule, for a plaintiff to prevail in a legal malpractice case in Connecticut, he must present expert testimony to establish the standard of proper professional skill or care." Davis v. Margolis 215 Conn. 408, 416, 576 A.2d 489 (1990). In order to prevail, plaintiff must prove that but for defendant’s alleged wrongful act–the recommendation that he settle with the CDPH–that he would have prevailed before the CMEB and there would not have been disciplinary action in New York and California. Plaintiff’s only disclosed legal expert admitted that she had never represented a physician in disciplinary [*5] or medical malpractice actions and had "no way of knowing" whether plaintiff would have prevailed before the CMEB.”

Insurers who pay insureds for medical costs, or for damages sometimes seek the right to share in the proceeds of the insured’s cases.  If an insured gets medical insurance coverage after an accident,] the insurance company would like to be reimbursed from the proceeds.

The right arises from the insurance contract, and sometimes by statute,  Other times, the insurance company asserts an equitable right to subrogation.  Here is a North Dakota case which illustrates the statutory variety.

IN THE SUPREME COURT
STATE OF NORTH DAKOTA
2008 ND 78
Robert N. Haugenoe, Claimant and Appellant
v.
Workforce Safety and Insurance, Appellee
and
Earl’s Electric, Respondent

"Robert Haugenoe appeals from a district court judgment affirming an agency order granting Workforce Safety and Insurance ("WSI") a subrogation interest in a legal malpractice settlement. The legal malpractice action concerned Haugenoe’s attorney’s failure to properly prosecute a medical malpractice claim related to a physician’s aggravation of a work-related injury suffered by Haugenoe. Haugenoe asserts that N.D.C.C. § 65-01-09, the subrogation provision of the workforce safety and insurance law, does not grant WSI a subrogation interest in the legal malpractice settlement. We agree. We hold that N.D.C.C. § 65-01-09 does not grant WSI a subrogation interest in an injured worker’s legal malpractice claim against a third-party tortfeasor. We, therefore, reverse the order of WSI and the district court judgment. "

Hinshaw reports that the Minnesota Supreme Court has determined the rules for legal malpractice liability to third parties, in a business setting.  In New York, liability is generaly limited to situations in which the attorney issued an opinion letter relied upon by non-clients.  Here the rule is similar, and set forth:

"The court held that a party who is not an express client can sue a lawyer for legal malpractice in a business transaction from which the party expected to benefit only if the party was a direct and intended beneficiary of the lawyer’s services or, in other words, if the benefit to that party is a central purpose of the transaction and the lawyer is aware of the client’s intent to benefit that party. The court found no such evidence here.

The court also held that a party did not have an implied contractual attorney-client relationship with a lawyer unless the lawyer is aware of that party’s identity, the party communicates with the lawyer and the lawyer is on notice that the lawyer is expected to represent that party. The court again found no such evidence here. "