Judicial Scrutiny of Frivolous Litigation Statute

lawsuit

Nobody wants to be named as a defendant in a lawsuit. Litigation is expensive, time-consuming, upsetting, and often intimidating for clients. Being dragged into a suit is even more frustrating when the defendant knows the claims are entirely without merit. Defendants who are the victim of frivolous litigation are not without recourse, however. Where the underlying lawsuit is unwarranted, without evidentiary support, or presented for an improper purpose, such as harassment or delay, defendants may have the opportunity to seek damages against the plaintiff and the lawyers who brought the claim.
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In Pari Delicto Not Enough to Save an Accountant

Fraud Concept - Magnifying Glass. In the face of corporate fraud and deceit, it is not uncommon for the defrauded entity to turn on its professionals. The inevitable issue becomes who is responsible for overseeing the enterprise: the business entity or the independent professional? Perhaps both. The in pari delicto affirmative defense can be an effective tool for professionals to shield themselves from liability arising from alleged wrongdoing of their underlying client. For example, we previously posted a victory for an accountant who successfully asserted the defense here. But, how and when to assert the defense is tricky as evidenced by a recent Pennsylvania District Court decision.
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Common Knowledge Exception to Affidavit of Merit Rule

iStock_000054736346 Your friends at Professional Liability Matters often focus on interpretation of Affidavit of Merit (“AOM”) requirements. As our handy table shows, each state has its own rules as to AOM requirements and other details regarding substance and form. These rules are of critical importance to many malpractice claims. Most states require an AOM from a professional within the same field certifying that the malpractice case has merit. This is a necessary gateway function so that litigants cannot sue professionals without any justification. Implicit in this requirement is that the typical fact-finder may not understand the appropriate standard of care, and therefore must rely upon professionals within the field. However, in some cases, an expert opinion may not be necessary to understand how the standard of care was breached. In some states this qualifies as an exception to the AOM requirement. Take for example the following case out of New Jersey which applied the common knowledge exception to the AOM requirement.
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Contingency Fees from Former Clients

530400381 Many professionals work on a contingency fee basis. If they achieve a favorable result for their client, they receive a percentage of the profit; no win, no fee. The basic arrangement assumes that the professional will continue to represent the client throughout the duration of the matter. But what are a professional’s rights when a client decides to hire new counsel in the middle of a case?
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Potential Conflicts for Summer Hires?

453643327 Many law firms employ law clerks, or hire summer associates. The former are often current law students, while the latter are almost always current law students. There are benefits to both the firm and the student in these situations; the student gains real-world legal experience and an opportunity to work alongside experienced attorneys, while the firm gets capable and often short-term employees. Many firms use these experiences as a way of determining future hiring, as a sort of “trial run” used to assess whether any of the clerks or associate could fit in well at the firm after graduating. It’s a practice that is as widespread as it is common.
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Tax Consequences of Employee Wellness Programs

498531806 Employee wellness programs are all the rage. While the concept is still relatively new, the potential implications of such programs are still being ironed out. Consider for example our recent post about how such plans can comply with other existing federal regulations. As employers struggle to make sure that their programs comply with existing regulations, another aspect of the employer wellness programs cannot be forgotten: taxes. The potential tax implications for both the employer and employee are an important aspect of any wellness program. In a recent Chief Counsel Advice (CCA) the IRS addressed what constitutes taxable income when benefits are provided to employees through a wellness program. Employers and tax-preparers should take note.
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Facebook Post May Lead to Attorney Disqualification

Facebook phone Social media is ubiquitous in the workplace. Professionals use social media to write about their achievements, to discuss developments in their field, and to promote their practices. Professionals who use social media as an extension of their practice must be cautious, however, that the discussion of pending matters does not violate their duty of confidentiality to clients or expose confidential information that would prejudice others.
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Duties of the Unintended Email Recipient

484016185 Model Rule of Professional Conduct 1.6(c) provides that “A lawyer shall make reasonable efforts to prevent the inadvertent or unauthorized disclosure” of client information. Generally that isn’t too difficult but things get complicated when it comes to electronic communication. Over 220 billion e-mails are delivered each day. According to reports, e-mail remains the most “pervasive form of communication in the business world.” Given the rampant use of e-mail, eventually there will be mistakes: your e-mail will land in the wrong hands or you will receive an e-mail meant for someone else. In some cases, the disclosure can be harmless, but what happens when the information lands in the hands of counsel for your adversary?
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Just How Super Are You? Advertising for Super Lawyers

532189954 We work hard. We achieve results. We want to develop business as a result of those successes. That's all understandable since self-promotion is an important part of the development of professionals. By touting personal achievements, professionals are better able to position themselves to compete for new clients. Not surprisingly, many professionals include personal accolades in advertising materials. While the use of awards may be an effective advertising tool, if can also lead to ethical violations when done improperly.
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Facebook’s D&O Lesson

Facebook phone Just like in life, directors must sometimes decide between taking what seems to be an unnecessarily formal route, or simply reaching the inevitable conclusion. Anyone who has spent an entire day putting together IKEA furniture only to finish with a few “leftover” screws can certainly understand that completion is often more important than the path it took to get there. However, the Delaware Chancery Court has made clear that when it comes to director liability, “no harm, no foul” is not the rule of law.
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