Professional Liability Matters

January 31, 2018 Cyber-Liability

Standing Battles Rage on in Data Breach Litigation

One of the primary points of contention in data breach actions is when, and whether, sufficient damages exist to meet the standing requirements under Article III. Circuit courts across the country have come to different conclusions, with some requiring a showing of actual damage and others allowing the existence of the breach to essentially serve as confirmation that the data will be used illicitly. According to a recent brief in support of certiorari, the DC Circuit falls into the latter category and a review by …

January 24, 2018 Accountants

Accountants Still Targeted a Decade after Recession

Similar to the fallout from Enron, the Great Recession of 2007 saw many accounting firms back in the cross-hairs for allegedly failing to warn of the impending financial doom. Many of these entities (turned plaintiffs) were massive companies with billions in assets, leading to protracted and expensive litigation. While some cases settled to avoid further legal costs, one major accounting firm was recently found liable for violating audit standards for one of its major bank clients prior to the Great Recession. The presiding judge is …

How Long Is Too Long to Wait for Malpractice Actions?

One of the most common problems facing a would-be plaintiff considering a malpractice case is when to file suit. Similarly, those that defend professionals must consider whether to move to stay proceedings if applicable. Especially with accountants and attorneys, causation and damages are difficult to calculate until the underlying matter has concluded. This means that the notoriously long legal process can often come into conflict with the statute of limitations, or create evidentiary problems. The decision is whether to wait many years for the underlying …

January 10, 2018 Defenses

Electronic Notifications for Affidavits of Merit?

The New Jersey Supreme Court recently declined to dismiss a medical malpractice case for an attorney’s failure to file a timely affidavit of merit (AOM). The court based its decision in large part on the trial court’s failure to schedule a preliminary conference (called a “Ferreira” conference in NJ) to discuss the sufficiency of the AOM. The court further stated that it would order improvements to the courts’ automated case management system to ensure the electronic notification of both the AOM filing obligation and the …

January 2, 2018 Legal Malpractice

Is a Client’s Criminal Prosecution Foreseeable?

Professionals assume a duty of care to their clients. Accordingly, professionals may be held liable for damages to clients that are proximately caused by their negligent acts. In many cases, the link between the professional’s negligent act and the client’s injury is clear, such as a missed deadline that waives a client’s rights. The limits of foreseeability become more difficult to define when the professional’s alleged misconduct triggers independent acts by third parties, such as a government investigation of the client.

In Kumaraperu v. Feldsted…

December 18, 2017 Employment Practices Liability / Risk Management

The Price of High Profile Investigations

With the recent wave of allegations concerning employment-related conduct, there may be in uptick of employers engaging outside firms to conduct internal investigations. While these can be kept in-house, high profile cases and social media often results in the publication of these reports to the public. Consider the NFL’s investigation of the Miami Dolphins known as “bullygate.”

In the Dolphins case, particular employees were identified as fostering a bullying culture and publicly identified in the conclusions. Although one of these employees had his …

December 13, 2017 Agents and Brokers

Case Study: Is a Broker a Fiduciary?

In a decision addressing the facts necessary to plead a breach of fiduciary duty claim against a broker, a California federal district court considered the difference between an “ordinary” broker-customer relationship, and one which rises to the level of a fiduciary relationship.

In Owner’s Management Co., the plaintiff (“Owner’s”) was an independent senior living property management company. Allegedly at the recommendation of its long-term broker, (“Broker”), Owner’s selected a self-funded employee healthcare benefit plan that was supposed to minimize Owner’s costs and potential exposures. …

November 28, 2017 Employment Practices Liability

Break Time is Over

Today’s employees demand flexibility. In turn, many employers are moving towards a “results orientation” business model and getting away from the standard 9-5 schedule. In other words, the employer cares less about when employees get the work done, and only cares that the work gets done effectively. Employment laws are only beginning to catch up to this shift in work hours. Take for example the recent decision where the Third Circuit confirmed that the FLSA requires employers to compensate employees for breaks of 20 minutes …

November 14, 2017 Cyber-Liability

Congress Considering Federal Cyber Breach Laws

Huge cybersecurity breaches at major retailers caught the attention of the public and have made headlines. Now, more recent breach at one of the major credit reporting agencies has the attention of Congress. 48 states and the District of Columbia already have some form of legislation governing security breaches. These statutes typically begin by laying out who is subject to the requirements, such as businesses and information brokers, and what information is considered protected “personal information.” The laws then outline what constitutes a breach, the …