Professional Liability Matters

February 11, 2020 Cyber-Liability / Law Practice Management

Law Firms (and Client Data) Held Hostage

Hackers have successfully hit at least five United States law firms within the past few weeks. Reportedly, the attacks are part of a coordinated effort potentially affecting nearly 200 victims in January alone. As if that were not frightening enough, the threat to law firms and to their clients, has magnified substantially in light of the type of attack now employed against law firms.

Rather than delivering a ransom note to the infected system and waiting for payment, the recent hackers are publishing the victim’s …

February 3, 2020 Legal Malpractice / Risk Management

You Dropped the Ball: Now What?

There are so many risk management sources, theories, and tips for the practitioner seeking to avoid a malpractice claim. But, there is less direction available to the professional that does make a mistake and knows about it. What are the obligations to the client, to the carrier, to others once we discover that we’ve dropped the ball? Are there implications on the statute of limitations? The South Dakota Supreme Court addressed these questions in a recent decision.

In the decision, available here, the court …

January 31, 2020 Coverage / Risk Management

Coverage Denied for Attorney Seeking Fee

At its simplest and most basic level, a professional malpractice policy for an attorney serves to insure against claims of malpractice. The devil is in the details, of course. In a recent decision, the Second Circuit affirmed a decision denying coverage to an attorney involved in a dispute over collection of his legal fee. The decision provides an interesting coverage lesson as well as a lesson about the sensitive nature of seeking to collect on a disputed fee.

In Continental Cas. Co. v. Parnoff, …

January 20, 2020 Defenses / Risk Management

Forum Shopping? Choose Philadelphia

America’s birthplace, home of the Liberty Bell, cheesesteaks and Rocky, the City of Brotherly Love is a destination for history, arts, culture…and personal injury cases. Once again, Philadelphia has been named America’s number one judicial hellhole in the annual ranking by the American Tort Reform Foundation for 2019. This is based on Philadelphia’s outrageous verdicts, amount spent on lawsuit advertisements, percent of out of state plaintiffs, and courts loosely applying venue rules.

Some highlights from 2019:

A major pharmaceutical company hit with an $8

January 13, 2020 Legal Malpractice

Attorney or Scrivener? LPL Claim Dismissed Due to Non-Representation Clause

A recent decision rendered by the New York Appellate Division, First Department, on October 17, 2019, held that the lower court properly dismissed a legal malpractice complaint on the ground that documentary evidence established there was no attorney-client relationship. In Seaman v Schulte Roth & Zabel LLP, 176 A.D.3d 538 (1st Dep’t 2019), the dispute centered on the enforceability of a “non-representation clause” disclaiming the existence of an attorney-client relationship and reaffirmed the importance of providing such clauses where an attorney seeks to limit …

January 6, 2020 General

Counsel Responsible for Client’s Massive Ponzi Scheme?

Nine law firms face $500 million in damages arising from the alleged aiding and abetting of a large securities scam. The scam was perpetrated by a now defunct, relatively well-publicized real estate investment firm (“Investment Firm”) that operated a Ponzi scheme targeting the retirement benefits of the elderly.

The man responsible for the scheme pled guilty to a 25-year sentence in late 2019. Now, through its bankruptcy trustee, the Investment Firm is reportedly suing its attorneys and claiming that they knowingly assisted in the fraud. …

December 9, 2019 Long Term Care

LTC Risk Management Tool: Hip Protectors

Hip fractures are one of the most-common orthopedic injuries sustained by plaintiffs in long-term and elder care cases arising from falls. Long-term care (“LTC”) facilities must endeavor to reduce fall-induced hip fractures through care-based interventions to optimize patient care, limit litigation, and decrease stress upon the health care system. The Journal of the American Medical Directors Association recently published a study, entitled “Effectiveness of Hip Protectors to Reduce Risk for Hip Fracture from Falls in Long-Term Care,” which addresses the hip protector as …

December 2, 2019 Ethics / Legal Malpractice

Missed Deadlines, No Communication Equals Disbarment

Deadlines are a way of life for most professionals, certainly attorneys. The practice of law involves tons of deadlines, many of which are subject to some form of extension, but an attorney must take active steps to either meet each deadline or see to it that the deadline is adjusted. An attorney’s obligation of competency and communication require that counsel meet each deadline and inform her client when something goes wrong. In a recent disciplinary proceeding, an attorney was disbarred for failing to competently …

November 25, 2019 Coverage

When Does an Occurrence Occur? Malicious Prosecution & Coverage

In this era of sophisticated DNA testing, exonerations of incarcerated individuals have become increasingly commonplace. The ensuing malicious prosecution lawsuits have justifiably resulted in high verdicts and settlements. The key issue for many municipalities is whether and under which policies of insurance is coverage triggered for these malicious prosecution claims. On November 21, 2019, the Supreme Court of Illinois, in Sanders v. Illinois Union Insurance Company, definitively determined that claims of malicious prosecution trigger coverage only under policies of insurance in effect on the …

November 11, 2019 Accountant Malpractice / Engagement Letters

Engagement Letter Defense Rejected

We often write about the importance of engagement letters, in fact we have an entire sub-category devoted to engagement letter defenses. That’s because the engagement letter is the first line of defense. A letter that clarifies the accountant’s obligations, scope of duties, identity of the client, billing terms and other key clauses is generally a must for most engagements. Accountants may also opt to include exculpatory language such as limitation of liability provisions, damages caps, or other contractual language which may aid in the defense …