Justia Professional Malpractice & Ethics Opinion Summaries

Exact developed business software. Infocon began distributing Exact’s software in 1998. A conflict arose when Exact allegedly abandoned a scheduled upgrade, leaving distributors like Infocon out to dry, and Infocon allegedly failed to remit fees. Exact sued Infocon in 2003. According to the district court, Exact showed “persistent noncompliance with… ever more stringent” discovery orders. When Infocon moved for a default judgment, Exact fired its lawyer, hired new counsel and entered settlement negotiations. . On the eve of settlement, Infocon fired its lawyer, DeMoisey. DeMoisey placed a charging lien on the settlement proceeds. Exact delivered the $4 million settlement to the district court, which distributed most of it to Infocon and placed the remaining $1.2 million in escrow pending resolution of the fee dispute. Nine months later, Infocon sued DeMoisey in Kentucky state court for malpractice. After a summary judgment ruling in favor of the lawyer, the district court held a bench trial and awarded DeMoisey $1.4 million in quantum meruit relief. The Sixth Circuit affirmed, rejecting arguments that the amount was too high, that Infocon had a right to a jury trial and, for the first time on appeal, that the district court lacked jurisdiction because DeMoisey and Infocon are both from Kentucky. View "Exact Software N. Am., Inc. v. Infocon Sys., Inc." on Justia Law

On May 25, 2011, Lassiter filed a complaint alleging Fourth Amendment violations for excessive force and false arrest. The complaint stated that the incident giving rise to Lassiter’s cause of action took place on May 22, 2009. On August 2, 2011, defendants filed an answer asserting six affirmative defenses, but did not raise the two-year statute of limitations as a defense. During a pretrial conference on September 20, 2011, without being prompted by either party, the district court observed that the statute of limitations appeared to have expired but that defendants failed to raise the issue in their answer. Defendants’ counsel acknowledged that they had missed this issue. The court suggested that defendants could amend their answer. On February 23, 2012, over Lassiter’s opposition, the court granted leave to amend the answer. On May 29, the court dismissed the complaint as time-barred. The Third Circuit affirmed, holding that the court had authority to raise the statute of limitations issue during the Rule 16 conference. View "Lassiter v. City of Philadelphia" on Justia Law

During a meeting with staff members of defendants Rutgers University and the University of Medicine and Dentistry of New Jersey (UMDNJ), plaintiff D.D. disclosed private health information that she requested be kept confidential. D.D. later discovered press releases issued by defendants that disclosed her private health information. Plaintiff immediately sent a letter directing defendants to cease and desist from communicating her personal information. Shortly thereafter, plaintiff, accompanied by counsel, met with representatives of defendants, accompanied by counsel. According to plaintiff, based on apologies and assurances made during the meeting, she believed that the matter could be handled privately. Plaintiff’s attorney subsequently asked plaintiff for additional information, which she promptly provided. Although her attorney assured her that he would "take care of everything," he was thereafter unresponsive to her efforts to contact him, which included at least ten telephone calls. Because she was unable to reach him, plaintiff retained new counsel in April 2010. The issue before the Supreme Court in this matter was: (1) whether the inattention of plaintiff’s counsel or her medical conditions constituted the "extraordinary circumstances" needed to excuse an untimely notice of tort claim under the New Jersey Tort Claims Act (TCA); and (2) whether a timely oral notice of tort claim could be permitted under the doctrine of substantial compliance. Upon review, the Supreme Court concluded that neither attorney inattention nor incompetence constituted an extraordinary circumstance sufficient to excuse failure to comply with the ninety-day filing deadline under the TCA; plaintiff's medical proofs were insufficient to meet the extraordinary circumstances standard; and the doctrine of substantial compliance could not serve to relieve a claimant of the TCA's written-notice requirement. View "D.D. v. Univer. of Med. & Dentistry of New Jersey" on Justia Law

Manning, a lawyer who served as the executor of Barney’s estate and the trustee of a trust for Mrs. Barney, set up accounts at National City Bank, one for the estate and one for the trust. He then wired funds, totaling about $1,250,000, from the bank accounts into the account of his business in violation of his fiduciary duties. Manning’s business failed and Manning confessed to Mrs. Barney that he had absconded with the money from the two accounts. The estate, trust, and Mrs. Barney sued Manning’s law firm in state court, but the suit was rejected on summary judgment. The Barneys then sued the successor to National City Bank to try to recover the money Manning stole. The district court dismissed, citing the affirmative defense of Ohio’s version of the Uniform Fiduciaries Act. The Sixth Circuit affirmed, stating that the Barneys failed to plead facts giving rise to an inference that the Bank committed any wrongdoing. View "Estate of Barney v. PNC Bank, Nat'l Ass'n" on Justia Law

Defendant, an attorney and the brother-in-law of Trent Lott, appealed from the denial of his 28 U.S.C. 2255 motion challenging one of his two convictions for bribing a judge. Defendant's conviction stemmed from his bribe of a circuit court judge in a lawsuit involving a fee-sharing dispute with co-counsel (the "Wilson Case"). Defendant offered to recommend the judge to Lott, who at the time was a U.S. Senator, for a district court judgeship in exchange for the judge's help in winning the Wilson Case. The court concluded that Skilling v. United States, which addressed the constitutionality of the honest-services statute, 18 U.S.C. 1346, had no effect on the district court's subject matter jurisdiction over defendant's guilty plea. Defendant had shown neither his actual innocence of post-Skilling honest-services fraud nor that there was cause and prejudice for failing to raise a constitutional-vagueness challenge to section 1346. Therefore, defendant procedurally defaulted on his claim and the district court correctly denied his section 2255 motion. Finally, the court rejected defendant's First Amendment overbreadth challenge to section 1346. Accordingly, the court affirmed the judgment. View "United States v. Scruggs" on Justia Law

Norma Slater-Moore hired the Goeldner Law Firm and its attorneys to represent her in what ultimately was an unsuccessful lawsuit and its appeal. Slater-Moore and Goeldner entered into two separate contracts during the course of that litigation, both containing nearly identical provisions stating that any attorney-fee disputes would be submitted to arbitration. Slater-Moore later sued Goeldner for legal malpractice and breach of contract, disputing, among other allegations, the amount she was billed for attorney fees. Goeldner successfully moved the Circuit Court to compel arbitration of the attorney-fee dispute, and Slater-Moore appealed that decision to the Supreme Court. Because the Supreme Court found ]no grounds for revocation of a valid agreement to arbitrate the fee dispute, the Court affirmed the circuit court's judgment. View "Slater-Moore v. Goeldner" on Justia Law

Martello, a doctor with a law degree, never passed the bar exam despite four attempts; in 1997 she passed the Multistate Professional Responsibility Examination. In 1991, Martello started reviewing medical malpractice cases for Santana, who paid an hourly rate. She alleges that they changed the arrangement for three cases and that Santana wrote that he would pay Martello 20 percent of his fee if the case settled before filing and 25 percent if the case settled after filing suit. Martello alleges that the document was intended to cover future cases. Later, Santana sent Martello a letter stating that: Kentucky canons of ethics prohibit the payment of your fees for assisting … on a contingency basis … you will be billing us on an hourly basis. Martello claims that Santana told her to fabricate time to earn the equivalent of what she would have received under the contract. Martello was dissatisfied with what she received and sued. The district court determined that Martello’s contract claims were barred because the contracts were void as against public policy, while her fraud claims, even accepting tolling agreements, were barred by the statute of limitations. The Sixth Circuit affirmed. View "Martello v. Santana" on Justia Law

Robert G. Smith, an Assistant Federal Defender for the Western District of New York, moved to withdraw from representing defendant in a criminal action pending in the district court. In this interlocutory appeal, Smith challenged the denial of his motion. The court did not reach the merits of Smith's argument based on his professional responsibility as an attorney because the court concluded on other grounds that the denial of the motion exceeded the limits of the district court's discretion. Defendant, having been informed of his right to counsel, stated that he did not wish to have appointed counsel, made no attempt to establish financial eligibility for appointed counsel under the Criminal Justice Act of 1964 (CJA), 18 U.S.C. 3006A, and refused to recognize Smith as his attorney. Under these circumstances, Smith's appointment was improper from the outset, and he could not be required to continue serving as defendant's attorney. View "United States v. Barton" on Justia Law

The law firm represented a potential buyer in the purchase of a drugstore. Buyer and Seller executed the sales contract separately. The firm misfiled the contract executed by Buyer, however, and Seller subsequently attempted to rescind the contract, which it characterized as an offer, because it had not timely received a copy of the contract executed by Buyer. When Seller’s efforts to avoid the purported contract were successful, Buyer sent a “formal notice of claim” to the firm, which sought coverage from its professional liability insurer. That insurer concluded that the firm was not entitled to coverage because it failed to properly notify the insurer of the mistake that ultimately led to the malpractice claim. The firm sought a declaratory judgment. The district court granted the insurer summary judgment. The Seventh Circuit affirmed, finding that the firm’s knowledge of the email exchange with Seller’s counsel and of an Alabama declaratory-judgment action constituted knowledge of “any circumstance, act or omission that might reasonably be expected to be the basis of” a malpractice claim. View "Koransky, Bouwer & Poracky, P. C. v. Bar Plan Mut. Ins. Co." on Justia Law

Petitioner David Stacy appealed a decision of the New Hampshire Bar Association Public Protection Fund Committee (PPFC) denying his claim for reimbursement for the fees and costs that he and his conservatorship estate paid to attorney Donald Wyatt. The PPFC found that the petitioner failed to demonstrate that the funds at issue were lost as a result of Wyatt’s embezzlement, conversion, or theft. Upon review, the Supreme Court found that the PPFC sustainably exercised its discretion when it denied petitioner's claims. View "Appeal of Stacy" on Justia Law