Justia Professional Malpractice & Ethics Opinion Summaries

Belsen Getty, LLC, a registered investment adviser owned by Terry Deru, obtained a claims-made financial-services-liability policy (the Policy) from XL Specialty Insurance Company covering Belsen Getty and its advisers for the period for one year. Under the policy, XL had no duty to defend. During the policy period James, Jenalyn, and Wade Morden brought claims against Belsen Getty and Deru alleging improper and misleading investment advice. XL denied coverage, asserting the Mordens’ claims and claims brought by the Securities and Exchange Commission (SEC) before the policy period concerned “Interrelated Wrongful Acts,” as defined by the Policy, and that the Policy therefore required treating the two claims as one claim made before the policy period. Belsen Getty and Deru then settled with the Mordens, assigning their rights against XL; and the Mordens sued XL in federal district court, raising the assigned claims that XL breached its covenant of good faith and fair dealing and its fiduciary duties to Belsen Getty and Deru in denying coverage under the Policy. XL counterclaimed that the Policy’s Interrelated Wrongful Acts provision precluded coverage. The Mordens moved for partial summary judgment on the counterclaim and on several of XL's affirmative defenses. XL moved for summary judgment based on the policy and for failure to prove bad faith or breach of fiduciary duty. The district court denied XL's counterclaim, but granted summary judgment on the bad-faith and fiduciary-duty claims. The Mordens appealed summary judgment against them on their bad-faith and fiduciary-duty claims and on the denial of their motion to amend their complaint to add a breach-of-contract claim. XL cross-appealed the summary judgment against it on its counterclaim that the Policy’s Interrelated Wrongful Acts provision barred all the Mordens’ claims. The Tenth Circuit reversed the denial of XL’s motion for summary judgment on its counterclaim: this reversal undermined the Mordens’ challenges to the summary judgment against them and the denial of their motion to amend. The Court therefore affirmed summary judgment against the Mordens on their claims and the denial of their motion to amend. View "Morden v. XL Specialty Insurance" on Justia Law

D.A.R. appealed a circuit court judgment dismissing his complaint against R.E.L., D.H., and R.H. D.A.R., a licensed attorney practicing in Alabama, filed a complaint against R.E.L., D.H., and R.H. R.E.L. was also a licensed attorney, and was employed as an assistant general counsel for the Alabama State Bar ("the ASB"). D.H. and R.H. were brothers; they were not attorneys. According to the complaint, at some point before December 2007, R.E.L. and D.H. began "a personal, professional and/or sexual relationship," and R.E.L. and R.H. began "a personal and/or professional relationship." D.A.R. alleged that in December 2007, at R.E.L.'s recommendation and with his assistance, D.H. and R.H. "filed a baseless complaint against [D.A.R.] with the ASB." D.A.R. alleged that the motivation for the complaint was to use it "as a means to protect [D.H. and R.H.] from liability for a debt owed by [them] to a client represented by [D.A.R.] and/or as retaliation for his role in representing that client." According to D.A.R., R.E.L. knew when it was filed that the complaint against D.A.R. was baseless in fact and in law. R.E.L. asserted the defense of absolute immunity, but presented arguments to the trial court establishing why quasi-judicial immunity should apply to the facts presented in D.A.R.'s complaint. The Alabama Supreme Court found D.A.R. failed to demonstrate the trial court erred by dismissing his complaint on the grounds he presented to it, and as such, affirmed the trial court's judgment. View "D. A. R. v. R.E.L., D.H., and R.H." on Justia Law

Texas's special tolling rule in Hughes v. Mahoney & Higgins, 821 S.W.2d 154, 157 (Tex. 1991), which suspends the statute of limitations on legal malpractice claims until completion of the litigation from which they arise, does not extend to actions against public adjusters. The Fifth Circuit affirmed the district court's dismissal of an action alleging negligence and breach of contract based on defendants' failure to submit proof of loss timely to Fidelity. The court held that plaintiff's claims could not implicate the unique relationship that triggered the bright-line rule from Hughes. The court reasoned that only Texas has the power to say where lawyering ends and adjusting begins, just as its courts have the sole power to decide Hughes's outer bounds. Because Texas law was clear, the court rejected plaintiff's alternative requests for certification of the issue to the Texas Supreme Court. View "Bloom v. Aftermath Public Adjusters, Inc." on Justia Law

This appeal stemmed from plaintiff Lucia Serico’s motion for attorney’s fees and other litigation expenses pursuant to Rule 4:58 after a jury trial on medical malpractice claims against Robert Rothberg, M.D. At issue was whether Serico could collect attorney’s fees from Rothberg despite entering into a “high-low agreement” that limited the amount she could recover at trial to $1,000,000. Based on the expressed intent of the parties and the context of the agreement, the New Jersey Supreme Court found the agreement set $1,000,000 as the maximum recovery. Therefore, Serico could not seek additional litigation expenses allowed by Rule 4:58. View "Serico v. Rothberg" on Justia Law

Bradley and Karol Johnson appealed a judgment granting the law firm Barna, Guzy, & Steffen, Ltd. ("BGS") foreclosure of a real estate mortgage for payment of a $258,769.97 debt, and an order denying their N.D.R.Civ.P. 60(b) motion for relief from judgment. In 2013 the Johnsons retained BGS to represent them in a lawsuit in connection with the probate of the estate of Bradley Johnson's father in Minnesota. The Johnsons resided in, and BGS was located in, the Minneapolis, Minnesota area. BGS extended credit to the Johnsons for costs, fees, and expenses that would be incurred in representing them in the lawsuit through a revolving line of credit agreement and a revolving promissory note. To secure payment, the Johnsons executed a mortgage on land they owned in North Dakota. The mortgage required the Johnsons to pay all of the principal and interest on the indebtedness when due to BGS. The Johnsons failed to make the payments to BGS as required under the loan agreements. In 2015 BGS brought this action against the Johnsons and others in North Dakota to foreclose the mortgage. The Johnsons counterclaimed, alleging its attorneys committed legal malpractice and other torts during the Minnesota legal proceedings. The district court ultimately dismissed the Johnsons' counterclaim without prejudice for lack of subject matter jurisdiction under N.D.R.Civ.P. 12(h)(3). The court granted summary judgment for foreclosure on the North Dakota property in favor of BGS, concluding the Johnsons were indebted to BGS in the amount of $258,769.97 under the loan agreements with interest continuing to accrue. Because the Johnsons did not establish the district court erred in any of its rulings, the North Dakota Supreme Court affirmed the judgment, and the order denying the motion for relief from judgment. View "Barna, Guzy & Steffen, Ltd. v. Johnson" on Justia Law

The issue this case presented for the Georgia Supreme Court concerned the constitutionality of the appointment process created by House Bill 597 (HB 597), a DeKalb County local law that delegated to private entities the power to appoint certain members of the DeKalb County Board of Ethics. The trial court found the appointment process created by HB 597 was unconstitutional and granted the writ of quo warranto as to four challenged Board members. The Board appealed this ruling, and the Supreme Court found the the trial court correctly granted the writ of quo warranto as to the four challenged Board members appointed by private entities, as these appointments were unconstitutional. View "Delay v. Sutton" on Justia Law

Plaintiff Kimberli Ransom, the relator and petitioner in this mandamus proceeding, filed a medical negligence action alleging that two radiologists employed by Radiology Specialists of the Northwest (defendant) were negligent in reading her imaging studies when they examined them in 2013. In 2016, during discovery in that underlying action, plaintiff took the depositions of the radiologists. The radiologists testified to the findings that they had made after examining plaintiff’s imaging studies, but, when plaintiff showed the radiologists the studies, they testified that they had no independent memory of reviewing them. When plaintiff then asked the radiologists to tell her what they could now see in those studies, defense counsel instructed the radiologists not to answer. Defense counsel took the position that those questions called for “expert testimony” that was not discoverable under ORCP 36 B. Defense counsel also argued that those questions impermissibly invaded the attorney client privilege set out in OEC 503. Plaintiff filed a motion to compel discovery and sought an order allowing her to ask the radiologists about their current “knowledge and ability to read and interpret” the imaging studies. The trial court denied plaintiff’s motion, and she petitioned the Oregon Supreme Court for a writ of mandamus requiring the trial court to grant her motion, or, in the alternative, show cause why it had not done so. The Supreme Court issued the writ; the trial court declined to change its ruling. The Supreme Court concluded the questions that plaintiff asked the radiologists about what they saw in plaintiff’s imaging studies in 2016 were relevant under ORCP 36 B; they were reasonably calculated to lead to admissible evidence about the radiologists’ treatment of plaintiff in 2013 and what they perceived and knew at that time. The Court also concluded those questions did not call for impermissible “expert testimony” and did not invade the attorney client privilege. View "Ransom v. Radiology Specialists of the Northwest" on Justia Law

Richard Joyce appealed the decision of an appellate officer within the Office of Professional Regulation dismissing his appeal for failure to file a statement of questions for consideration on appeal and complete the record for appellate review by ordering a transcript. Joyce has been a licensed surveyor since 1969. In 2014, Joyce completed a survey of the boundary between two adjoining properties. One of the property owners filed a complaint with the Office of Professional Regulation, Board of Land Surveyors (OPR) regarding Joyce's compliance with professional surveying standards. OPR opened an investigation into the complaint and, after review ultimately dismissed the complaint. Months later, OPR sent Joyce a letter stating that "[n]ew evidence ha[d] been brought to [its] attention . . . that warrant[ed] further investigation and reconsideration." OPR did not disclose the nature or origin of the new evidence. OPR sent Joyce a letter notifying him that "[t]he State Prosecuting Attorney ha[d] filed the enclosed charges and ha[d] asked the Office of Professional Regulation to take disciplinary action against [his surveying] license." A hearing on the charges was held in June 2017; OPR fined Joyce $750 and placed a two-year condition on his surveying license, requiring that he complete additional surveying training within 180 days of the entry of the order. The order noted Joyce's right to file an appeal with an OPR appellate officer within thirty days of the entry of the order. The order also contained instructions on how to request forms for proceeding in forma pauperis, including a statement that in forma pauperis status would make Joyce eligible to receive a transcript of the June hearing without cost. In his filing, Joyce's attorney reiterated that the appeal presented two legal issues, both raised in the attorney's notice of appeal, and that a transcript was unnecessary for resolution of the appeal. Neither Joyce nor his attorney filed a statement of questions, ordered a transcript of the June 2017 hearing, or filed a brief. The Vermont Supreme Court found that because Joyce provided the appellate officer with neither a statement of questions nor a transcript, per OPR rules, the record was not complete, and the appellate officer was effectively unable to conduct a review of the proceedings below. The appellate officer correctly considered the factors relevant to the decision not to review Joyce's filings in a summary manner and to dismiss Joyce's appeal, specifically, the procedural irregularities in the appeal that essentially foreclosed appellate review. View "In re Richard H. Joyce" on Justia Law

The Fifth Circuit affirmed the district court's dismissal of plaintiffs' claims against defendant as premature. Plaintiffs alleged that Eisner, seeking to maintain its relationship with Leveraged and some related funds, participated in a scheme to trick plaintiffs into waiving their redemption rights. Louisiana has established a public accountant review panel to review claims against certified public accountants and accounting firms, and plaintiffs conceded that they did not seek panel review before filing suit. The court held that the district court dismissed plaintiffs' suit as premature because they failed to seek pre-suit review by the Louisiana public accountant review panel pursuant to Louisiana Revised Statutes 37:105. Accordingly, the court remanded for the district court to decide in the first instance whether defendants were entitled to dismissal with prejudice. View "Firefighters' Retirement System v. EisnerAmper, LLP" on Justia Law

The Supreme Court vacated the jury’s $2.75 million award for non-economic damages in this legal malpractice and breach of contract case, holding that the case did not qualify as one of the “rare” cases where non-economic damages can be recovered for breach of contract.Plaintiff sued Defendants for legal malpractice, breach of contract, breach of fiduciary duty, and negligent hiring, training, and supervision after Defendants failed to bring Plaintiff’s claim before the statute of limitations ran. The jury found in favor of Plaintiff on each of the claims, awarding her $750,000 in damages for breach of contract and $2.75 million for the emotional distress Plaintiff suffered as the result of the malpractice. The Supreme Court vacated the non-economic damages award, holding that, under either a breach of contract or breach of fiduciary duty theory, the district court erred in upholding the award for emotional distress damages. The Court also vacated the attorney fees award and held that the district court correctly denied Plaintiff’s litigation expenses. View "Gregory & Swapp, PLLC v. Kranendonk" on Justia Law