Plaintiff is a doctor who was sued in medical malpractice for an Erbs palsy case.  He settled, and then turned to sue his attorney alleging that the attorney forced him to settle, failed to use photographs of the birth which woul have exonorated him, and allowing the doctor to be reported to the National Practitioner Data Bank.

The NJ Supreme Court reversed a summary judgment decision against the doctor, and the case continues in part:

Steinberg’s remaining claims for damage to his reputation and for legal fees and costs resulting from the alleged legal malpractice should not have been summarily dismissed. Damage to reputation does not require proof of economic loss. Under the law of libel, damages are divided into three categories:

(1) Punitive or exemplary damages, where actual malice or recklessness is shown; (2) special damages, such as loss of business, which are recoverable only upon proof of loss of specific economic benefits; and (3) general damages which the law presumes to follow inevitably from a defamatory publication and which, therefore, are often recoverable without proof of injury.

[Bock v. Plainfield Courier-News, 45 N.J. Super. 302, 309 (App. Div. 1957).]

Where legal malpractice is alleged to have proximately resulted in damage to the client’s reputation, as here, we see no reason to impose a more stringent proof requirement than is imposed by the law of libel. Thus, a client whose reputation has been damaged as a result of legal malpractice may recover general, or nominal, damages in the absence of "proof of loss of specific economic benefits." Ibid.

With respect to the legal fees and costs incurred in prosecuting the legal malpractice action, the Supreme Court in Saffer v. Willoughby, 143 N.J. 256, 272 (1996), held that "a negligent attorney is responsible for the reasonable legal expenses and attorney fees incurred by a former client in prosecuting a legal malpractice action." We have held that neither R. 4:42-9(a) nor the "American Rule" preclude such an award in a legal malpractice action. Bailey v. Pocaro & Pocaro, 305 N.J. Super. 1, 6 (App. Div. 1997). Accordingly, the motion judge erred in dismissing the legal malpractice action in its entirety.

Legal malpractice in criminal defense does not exist. Bluntly put, a criminal defendant may not successfully sue his criminal defense attorney absent a showing of “actual innocence”. This translates to: reversal, ineffective assistance of counsel determined by a CPL§ 440 motion or exculpation.

Scott H. Greenfield reports an interesting take on this issue in his  Simple Justice Blog.  Here is a short take from it:

Most criminal defense lawyers take comfort in the tacit understanding that the chances of being successfully sued are slim to none. Absent proof of actual innocence, even abject incompetence causes no harm. So that gives the defense lawyer a free pass in botching a case, true?

Unfortunately, the answer is, with certain exceptions, true. This emboldens some lawyers to act with utter indifference to their responsibilities to their clients. Failing to ask for a hearing, or give proper and timely alibi notice. Failing to inspect a crime scene or read the discovery. The dreaded motion to suppress identification when no ID notice was given. Falling asleep at trial, for god’s sake. All terrible, but not necessarily actionable. Why? Because the defendant cannot prove actual innocence.”

Greenfield, a nationally recognized criminal defense attorney, television commentator and author, specializes in trials and appeals with offices in New York City.

A report from Hinshaw:

"After a union’s health care fund failed to pay numerous benefits on behalf of its members, suit was filed against the Fund’s trustees and the third-party administrator, alleging multiple ERISA violations. The trustees then brought a third-party complaint against their attorneys, alleging legal malpractice and breach of fiduciary duty. The district court dismissed all claims against the attorneys with prejudice. "

Law firm’s decision not to sue potential defendant could not be basis for malpractice claim because law firm acted reasonably where liability and damages were uncertain

Hinshaw reports:

Achtman v. Kirby, McInerney & Squire. LLP, ___ F.3d ___, 2006 WL 2720643 (2nd Cir. Sept. 25, 2006)

The United States Court of Appeals for the Second Circuit has held that law firms which served as class counsel in a securities fraud action are not liable for legal malpractice for failing to assert claims against the auditor of the securities issuer where the liability of the accounting firm, i.e. the auditor, was doubtful and damages were uncertain.

In April 1996, several class action suits were filed against Bennett Funding Group (BFG) alleging securities fraud based on an elaborate Ponzi scheme involving sham contracts and fictitious financial statements. The suits were consolidated and two law firms, the Kirby law firm and the Bernstein law firm, were appointed co-lead counsel. The class consisted of over 20,000 investors in BFG securities. Arthur Andersen & Co., which had audited BFG’s misleading 1989 and 1990 financial statements, was not named as a defendant. Mahoney Cohen, which had succeeded Andersen as BFG’s auditor, was named a defendant. A $125 million settlement, which included $14 million from Mahoney Cohen, was reached. Some BFG investors, represented by different law firms, had since filed individual actions against Andersen and in some instances had reached settlement agreements. In 1999, the firms representing those individual defendants attempted to bring a class action suit against Andersen on behalf of the BFG investors, but the suit was time-barred

A recurring question in legal malpractice is whether the attorney client privilege is waived by bringing the case.  While it is almost always waived as to the defendant attorney, for the most part it is not waived for other attorneys.  Here is a Florida case on the subject.

"Coates v. Akerman, Senterfitt & Eidson PA, 940 So. 2d 504 (Fla. 2006)

A Florida appellate court has held that a law firm accused of giving negligent advice in a matter cannot invoke the “at issue” waiver doctrine to pierce the attorney-client privilege for communications between the clients and other attorneys who advised them in the same matter. The court held that no “at issue” waiver could be found merely because the clients had other legal advisors concerning the same subject or because the law firm asserted a comparative fault defense in the malpractice action.

In the suit, former clients sued the law firm of Akerman, Senterfitt & Eidson, along with one of the firm’s shareholders, and a former firm lawyer, in connection with a “proprietary tax savings plan” and the establishment of a joint venture. Plaintiffs, Bobby and Deborah Coates (Coates), Bredel Corp., and two related entities, claimed that they received advice from the lawyers about the plan and the joint venture. Defendants denied any negligence and claimed that plaintiffs’ damages were caused by their own or others’ actions.

This is not per se legal malpractice, but it is a shocker.  In this Ohio Federal decision, the insurance broker is immune from suit for negligent failure to procure or for the procural of wrong insurance. 

"In Mafcote v. Genatt Associates, 2007 U.S. Dist. Lexis 10117 (S.D. Ohio Feb. 14, 2007), U.S. District Court Judge Susan Dlott held that an insurance agent or broker cannot be sued by a policyholder for negligence unless the insurance agent or broker committed an act or error that causes actual physical injury or property damage. The alleged failure to procure proper insurance coverage does not give rise to such a negligence claim. Under Mafcote, an Ohio insurance agent or broker cannot be sued for negligent failure to procure insurance or the right type of coverage. "

We predict that this will come up in a legal malpractice setting in the near future;  it might be that the attorney is sued for no coverage and he turns to the broker as a co-defendant.  Other senarios?  You pick ’em.

Doctor is successfully sued in medical  malpractice  to the tune of $ 116 Million now sues his defense attorneys for not settling in the $ 1,5 million dollar range.. 

"Doctors who lost a malpractice lawsuit to the tune of $116.7 million are now suing their lawyers, saying the attorneys were negligent.

A Hillsborough County jury in October ordered the doctors to pay Allan Navarro, who went to University Community Hospital in Carrollwood on Aug. 9, 2000, with nausea, a headache, dizziness, confusion and double vision. He was diagnosed with sinusitis and a headache and told to go home. Navarro returned the next day. A stroke left him in a coma for three months. Now, Navarro has no use of his arms or legs. According to lawsuits filed last week in Hillsborough Circuit Court, the doctors’ attorneys turned down several settlement offers, ranging from $1.5 million to $3 million, and were negligent in their handling requests for information from Navarro’s attorney"

This is a blog blurb from the subscription NJLJ site.  "A law firm defending itself in a legal malpractice case took an unusual tack: trying to avail itself of the plaintiff’s expert — Fox News commentator and former state judge Andrew Napolitano — while trying to impeach his ethics history."

It looks as if defendant called plaintiff’s expert as a fact witness, and then tried to branch out and sully his upcoming expert testimony.

Here is a blog blurg from Hinshaw:

"New York Court Holds Lawyers Retained By Insurer to Represent Insured May Have Duty to Put Excess Carrier on Timely Notice of Claim

Shaya B. Pacific, LLC v. Wilson, Elser, Moskowitz, Edelman & Dicker, LLP, 827 N.Y.S.2d 231 (N.Y.A.D. 2 Dept. 2006)

After a judgment was returned in excess of the primary policy limits, the defendant in the underlying tort case, plaintiff in this case, sued the defense firm for failing to put the excess carrier on timely notice of the claim. The lower court dismissed the case, but the appellate court reversed the dismissal and held it may be possible for a lawyer retained by the primary insurer to be liable for failure to investigate insurance coverage. The key is the scope of representation. "

Bankruptcy court is said to be full of conflicts of interest.  Here, there is a possibility that Pilsbury Winthrop will be divested of its lead counsel role and made to give back $4 million in fees. 

"An alleged conflict of interest could cost Pillsbury Winthrop Shaw Pittman its role in a long-running bankruptcy case — and more than $4 million in fees.

A San Jose, Calif., bankruptcy judge has scheduled a March 19 hearing on a motion by the U.S. Trustee’s office to disqualify the firm and disgorge the fees it has racked up representing SonicBlue since the electronics maker went belly-up four years ago.

The motion claims that in a 2002 opinion letter, issued before the company went bankrupt, Pillsbury assured senior note holders that SonicBlue would repay a $75 million bond obligation in full. Last September, the bond holders — three hedge funds — threatened to sue Pillsbury unless it indemnified them.

This, trustee’s attorney Nanette Dumas wrote, underscored a conflict Pillsbury should have recognized from the beginning. The firm is "arguably ‘on the hook’ for any shortfall," because of the 2002 letter, Dumas wrote. With creditors in a bankruptcy often receiving a fraction of what they are owed, Pillsbury could be motivated to protect itself by not cutting the senior note holders’ claim. "For ever dollar the senior note holders’ claim was reduced, [Pillsbury’s] corresponding exposure would increase," Dumas wrote. "