Legal malpractice carriers are always looking for a way out.  Coverage exclusions, notice provisions, each week out a very significant number of potential claims.  Notice provisions are found both in the initial [usually yearly] applications, as well as the obligation to inform the carrier as soon as a claim is even a potential.

Here is a case from the 9th Circuit, reported by Circuit Watcher Blog, 06-15622 James River Ins. Co. v. Hebert Schenk, P.C. Before: William C. Canby, Jr., David R. Thompson, and Milan D. Smith, Jr., Circuit Judges.
"In this appeal we decide whether the district court erred in granting summary judgment to a professional liability insurer on a claim seeking a declaration of no coverage, and on counterclaims for breach of contract and bad faith under Arizona law. The insurer argued that it could permissibly refuse to provide for its insured’s defense against a legal malpractice lawsuit because the insured failed to mention the possibility of the lawsuit in the insurance application. The district court agreed and held that Arizona Revised Statutes § 20-1109 permits a denial of coverage because the insured’s omission constitutes legal fraud. The court rejected the counterclaims because the insurer provided for the malpractice defense. We reverse and remand for trial."

NY Lawyer, via Legal Inteligencer reports on this big number legal fee disgorgement case in Philadelphia.

"A Philadelphia judge has ruled that a Montgomery County law firm should pay $5.2 million, including $1 million in punitive damages, for attorney fees the judge said the firm unlawfully accumulated during its collection of delinquent municipal and school district real estate taxes.

Common Pleas Judge Mark I. Bernstein rendered a verdict Tuesday in the Roethlein v. Portnoff Law Associates Inc. class action against Portnoff Law Associates of Wynnewood. Defendant Michelle R. Portnoff, an attorney, is the president and sole shareholder of the firm, Bernstein said.

Bernstein ruled that the plaintiffs triumphed on an unjust enrichment claim and an Act 6 violation claim because the Portnoff law firm ignored appellate court decisions that municipalities could not add attorney fees to owed tax sums in the hopes that the law of Pennsylvania would change and make those attorney fees legal. Act 6 allows for recovery of charges paid in excess.

Bernstein ordered that the Portnoff firm pay a $5,213,670.08 award, including: $2,654,972.98 in unlawfully received attorney fees; penalty damages of $500,000; $1 million in punitive damages; and $510,855 in unlawfully collected administrative fees and $18,493.55 in interest unlawfully collected on the administrative fees, which were doubled to an award of $1,058,697.10 because, under Act 6, "all sums unlawfully collected as administrative fees and interest on the attorney’s fees are doubled"

This story fromDaily Business Review about cruise line legal malpractice is a twist on the usual.  Generally the story is about a lost plaintiff’s case based on jurisdiction, or the lack thereof.  Here the story is considerably more inflammatory,  Plaintiff’s lawyer Jay Wingate has been in the news lately, with tales of chasing cases, payoffs, and the like,  Now, it is reported that:

"Royal Caribbean Cruise Lines is suing attorney Jay Wingate to recover about $1 million in attorney fees, alleging his firm used misrepresentation to settle 23 worker-injury cases with the cruise line.

Lawyers for the Miami-based company pressed their claim Monday for the money in Miami-Dade Circuit Court after effectively forcing Wingate off a portfolio of 77 other admiralty cases.

Royal Caribbean claimed a Wingate paralegal and investigator paid kickbacks to a corrupt claims adjuster with the cruise line in exchange for inside information on acceptable settlement amounts.

Royal Caribbean had moved to disqualify Wingate from the remaining cases, but Wingate abruptly announced he would withdraw from the cases and go into semi-retirement.

“Now they’re saying ‘OK, let’s get our pound of flesh,’ ” Wingate’s lawyer, Miles McGrane III of McGrane Nosich & Ganz, told Miami-Dade Senior Circuit Judge Herb Stettin. "

New York Lawyer reports that Aretha Franklyn, the Queen of Soul is in danger of losing her mansion over a missed tax payment, which was supposed to be handled by her attorney.  Here is the story from the AP:

"Aretha Franklin could lose her home to tax collectors. The singer says an attorney’s mistake caused her $700,000 mansion in Detroit to slip into foreclosure over $445 in 2005 taxes and late fees.

The Detroit Free Press reports Thursday the Queen of Soul owes a total of $19,192 in back taxes on the property through 2007. She says she plans to pay up and reclaim it by a March 31 deadline.

A spokesman for the Wayne County treasurer’s office says the foreclosure judgment for $445 was entered earlier this month.

Reported today in the NYLJ, the case of Sapir v. Resnick, Supreme Court, Nassau County , Decided February 26, 2008 illustrates an important point.  The attorney’s mistakes are but the starting point in any legal malpractice case.  Vitality of the underlying case is all important too.

Here, "Justice Palmieri held that malpractice had occurred "when the defendant attorney failed to place the matter on the trial calendar, and because of this failure, was dismissed.

Then, analysis went on to the underlying case, which was a defective ladder claim.  That claim was a defective ladder lock which led to a collapse.  The legal malpractice case was defeated by a ladder expert who testified, and convinced the jury, that the ladder could not have collapsed as described by plaintiff.  Result?  Defense verdict, even after a good demonstration of legal malpractice deviation.

Blackwater’s Attorney Wiley Rein, is involved in litigation over the deaths of Blackwater employees in Iraq.  Tied up in this case are the questions of the military, contractors to the military, and the rules which apply to them.  Do the rules changes in a war zone, do active military operations in the immediate area change the rules, and are employees of a contractor who are not military personnel within the Federal Officer removal statute.

Discussed by BLT, the Blog of Legal Times tells this story:

"Wiley Rein has filed a motion to dismiss the $30 million legal malpractice lawsuit that Blackwater Security Consulting brought against the firm in late January in D.C. Superior Court.

The lawsuit alleges that if Wiley Rein and former partner Margaret Ryan, now a federal judge who is also named in the suit, had cited the federal officer removal statute and appropriate case precedent when defending the private security contractor in a 2005 wrongful-death suit, the case would have remained in federal court and eventually been thrown out. Instead, the case was remanded to the Superior Court of Wake County in North Carolina and is currently in arbitration.

According to Wiley Rein’s motion to dismiss, filed with Judge Judith Retchin yesterday by the firm’s attorneys — Zuckerman Spaeder partners Mark Foster and Elizabeth Taylor — the federal officer removal statute doesn’t apply. The motion argues that Blackwater wasn’t working in tandem with the U.S. military when its four employees were killed in Fallujah, Iraq, but rather was independently handling security for a catering contractor. "

From New York Lawyer:

"The $5 million malpractice case against star litigator Michele Roberts of Akin Gump Strauss Hauer & Feld will proceed to trial in D.C. Superior Court.

In a hearing that lasted more than three hours on March 7, Judge Jennifer Anderson weighed motions to dismiss, as well as a host of other matters. In addition to Roberts, the defendants include solo practitioner Steven Kiersh, and Goodwin Procter, the firm that absorbed Shea & Gardner, where Roberts once practiced. A trial date was set for Nov. 3.

The case stems from Roberts’ representation of Vaughn Stebbins in a 2001 civil case against the District and a Metropolitan Police Department officer. Stebbins claims Roberts botched his chance to recover damages for injuries he received after being shot by the police officer, and accuses Roberts of causing mishaps that led to the dismissal of his case. Roberts failed to formally withdraw her name from Stebbins’ case, even though Kiersh eventually took over the matter.

On Friday, Anderson granted partial summary judgment to Goodwin Procter, ruling that the firm did not have an attorney-client relationship with Stebbins, since Roberts took his case when she still had her own firm, Rochon & Roberts. Anderson, though, denied Roberts’ and Kiersh’s motions to dismiss, with regard to their claims that Stebbins’ underlying excessive force case would have ultimately failed. "

Legal malpractice insurance policies require, in general, that the insured notify the carrier of all incidents and claims, on penalty of forfeiting coverage.  Here is an interesting article from Wiley Rein on this issue:

"The United States District Court for the Middle District of Florida, applying Florida law, has held that a letter that gave notice of a potential lawsuit and requested information but that did not demand money or advise the recipient to put his insurance carrier on notice did not constitute a "Claim" under a medical malpractice professional liability policy. Myers v. Interstate Fire & Cas. Co., 2008 WL 276055 (M.D. Fla. Jan. 30, 2008).

An insurer issued a claims-made malpractice policy to a physician for a policy period ending June 19, 2003. The policy defined a "Claim" as "a demand for money, or the filing of Suit naming the Named Insured and alleging a Bodily Injury or Property Damage as a result of a Medical Incident."

Counsel for a former patient sent the doctor a letter on September 6, 2002, stating that he had been retained to represent the patient in a "claim for damages" arising from the doctor’s negligence and requesting a copy of any statements made by the patient, as well as a written statement identifying the doctor’s liability carrier. The insurance broker purportedly forwarded this letter to the insurer’s managing agent on September 22, 2002, though the agent had no record of having received it. "