A law firm’s failure to disclose a potential claim on its insurance application may act as a waiver of coverage. Lloyd’s of London recently argued that coverage did not apply to a California based law firm in a multi-million dollar legal malpractice action. According to Lloyd’s, the professional liability insurance policy contained an exclusion for claims the firm knew or reasonably should have known about prior to the effective date of the policy. At the time the law firm procured the policy, an attorney from …
Continue ReadingLATEST INSIGHTS
Arrests Follow Massive, International Cyber-Heist
Recent arrests followed one of the more complex cyber attacks in history. $45 million was reportedly stolen in the blink of an eye but it may take years to comb through the unprecedented cyber-liability issues. Two major banks are now evaluating novel liability issues and presumably deciding whether to lodge a series of lawsuits with major implications on the landscape of cyber-liability.
This week the press reported that the Oman-based bank of Muscat and the United Arab Emirates-based National Bank of Ras Al Khaimah PSC …
Continue ReadingAttorney Sued for Wrongful Death
One of the foundations of the attorney-client relationship is confidentiality. Apart from limited exceptions, attorneys are generally precluded from disclosing a client’s confidential information to a third-party and must act at all times in the client’s best interest. It is well established that failure to do so may constitute an ethical violation and perhaps professional misconduct. A recent $40 million lawsuit claims that an attorney’s breach of his client’s confidences led to the client’s murder. Uh oh.
A wrongful death suit filed last week by …
Continue ReadingGolfer Tees-Up Professional Malpractice Lawsuit
A professional golfer – with a famous ex-fiance – recently filed a professional malpractice claim against his former accountant for allegedly concealing unpaid taxes in excess of $500,000. Hank Kuehne is an amateur champion who last played in a major tournament at the 2012 Honda Classic, but is perhaps best known for his prior engagement to tennis great Venus Williams. Reportedly, Kuehne had no idea of his mounting tax liability until he fired his advisor and retained a new accountant to manage …
Continue ReadingInsurance Implications in the West, Texas Explosion
One million dollars of coverage for $100 million in losses? Unfortunately, that appears to be the case for the West, Texas fertilizer plant that recently exploded. Reportedly the owners of West Fertilizer Co. hold a negligible amount of insurance compared to the estimated cost of the damage caused by the blast. The plant did not hold excess or umbrella insurance policies. The fact that the company’s owner has not breached any applicable regulation has been the subject of heated debate on the national level regarding …
Continue ReadingIgnoring Prejudgment Interest = A Costly Mistake
Prejudgment interest awards are often overlooked in evaluating a claim, especially legal malpractice matters. Typically, when valuing exposure, the focus centers upon the underlying action had the attorney avoided alleged negligence. But overlooking the impact of prejudgment interest can prove to be a costly mistake. Depending upon the statutory interest rate in your jurisdiction and the potential amount of the award, prejudgment interest can transform a nuisance value malpractice case into a hefty judgment.
Consider Corsiatto v. Maddalone, March, 2013 N.Y.Slip. Op. 30553, (Sup. …
Continue ReadingReal Estate Transactions Pose the Greatest Risk of Attorney Malpractice
According to a recent study, real estate transactions pose the most risk to attorneys of a malpractice claim. In its annual survey, the American Bar Association reported a higher percentage of professional liability claims stemming from real estate dealings than any other area. Over the past several years, plaintiff personal injury claims topped the list, but to the joy of the plaintiff’s bar and the chagrin of real estate professionals, that trend is apparently changing.
The top three types of activity leading to the majority …
Continue ReadingInsurance Blunder Costs Newest Philadelphia Eagles’ QB $11.5 Million
Quarterback Matt Barkley was selected by the Philadelphia Eagles with the 98th pick in the 2013 NFL draft. He was the fourth quarterback selected and was the first selection in the fourth round. History suggests that he will sign a four-year contract with the Eagles worth about $2.5 million. Sure, that’s a lot of dough, but not nearly what Barkley would have earned had he foregone his senior season at USC and entered the NFL draft in 2012. As a projected top-10 pick …
Continue ReadingFormer New Jersey Governor Sued for “Grossly Negligent” Conduct
Former New Jersey Governor Jon Corzine and other executives from MF Global were recently sued over the 2011 collapse of the commodity trading firm. In the suit, the bankruptcy trustee claims Corzine and others caused the firm to fail through a risky trading strategy and “grossly negligent” oversight. Corzine allegedly was aware that the trades were high risk, but failed to implement proper policies to protect the firm. In particular, the lawsuit contends Corzine breached his duties to the shareholders of MF Global and failed …
Continue ReadingLawsuits Targeting America’s Wealthiest
A high percentage of the wealthiest Americans believe that they are more likely to be the subject of a lawsuit today than they were before the financial crisis. The issue of disparity of wealth, income and taxation has intensified these fears that their wealth can attract lawsuits. These concerns are reportedly legitimate, because under the widely accepted doctrine of joint and several liability, if more than one defendant is responsible for a plaintiff’s injury, any of the defendants may be held responsible for the …
Continue Reading