Menu

Showing 45 posts from 2015.

Conflicts in Law Firm Vereins: the Novel Conflicts Issue of the Moment

As globalization continues to drive law firm mergers and the creation of ever larger, multinational law firms, a number of such firms have employed the structure of a Swiss verein. In a verein, separate law firm entities in various countries combine into one firm for marketing, branding, referral, and administrative purposes, but the entities within a verein do not share profits at the verein level. There are now six very large law firm vereins operating in the United States. We likely will see more in the future. More ›

Bye-Bye Boilerplate Objections

So many practitioners respond to discovery demands by asserting objections and then respond ‘subject to’ or ‘without waiving’ their objections. This "belt and suspenders" approach is common practice and seemingly appropriate, right? Many federal courts disagree. In fact, conditional objections may result in waiver, the unwanted production of documents, or sanctions. More ›

Is it Time to Reconsider Restrictions on Responding to Negative Online Reviews?

A recent disciplinary decision from Colorado suspending an attorney for 18 months for "internet postings that publicly shamed [a divorcing] couple by disclosing highly sensitive and confidential information gleaned from attorney-client discussions" (among several other violations of Colorado's Rules of Professional Conduct (RPCs)) demonstrates that however provoked and angry a lawyer may feel about clients or former clients, using the Internet to vent those feelings is a very bad idea. In People v. James C. Underhill Jr., (2015 WL 4944102), decided Aug. 12, 2015, the Presiding Disciplinary Judge in Colorado suspended attorney AttorneyU for 18 months, and also required that, in order to be reinstated, "[Attorney U] will bear the burden of proving by clear and convincing evidence that he has been rehabilitated, has complied with disciplinary orders and rules, and is fit to practice law." More ›

What You Need to Know About the Amendments to the Federal Rules of Civil Procedure Going Live Tomorrow

Major changes to the federal rules go into effect tomorrow December 1st. The amendments apply to cases currently pending in the federal court.  Below are a few highlights of the amendments that lawyers should be aware on a going forward basis.   

Perhaps the biggest change pertains to the scope of discovery permitted in federal courts. As amended, Rule 26 provides that the scope of discovery allows a party to obtain and non-privileged information that is relevant to the parties' claims and defenses, and proportional to the needs of the case. The phrase "reasonably calculated to lead to the discovery of admissible evidence" has been deleted. The concept of proportionality was added to the beginning of Rule 26(b)(1) to emphasize that proportionality can and should be used to limit discovery especially where the burden of the proposed discovery outweighs its likely benefit. There are a series of factors in making a proportionality determination that a court and the parties should consider including the importance of the issues at stake in the litigation, the importance of discovery in resolving those issues, the amount in controversy, as well as the parties relative access to relevant information and their resources.  More ›

Contingency Fee Dispute Results in Double-Damage Award Under Connecticut's Revised Wage-Dispute Statute

Robert Healey v. The Haymond Law Firm, PC, HHD-13-CV-6042956-S (Hartford, Connecticut, October 29, 2015) showcases the risk posed when there is no proper documentation of a fee-splitting arrangement, as well as untimely payment. Firms should pay scrupulous attention to the documentation of all such arrangements and to their pay practices as a result of such arrangements. While there may be a safe harbor defense in jurisdictions like Connecticut if the employer can establish it had a good faith belief that the wages were paid in compliance with the law, this may not always be the case More ›

Transition Activities in the sale of a Law Practice

For several years in Illinois, Rule 1.17 of the Rules of Professional Conduct has authorized the sale of a law practice, including the sale of goodwill.  Illinois Rule 1.17 provides:

A lawyer or a law firm may sell or purchase, and the estate of a deceased lawyer or the guardian or authorized representative of a disabled lawyer may sell, a law practice, including good will, if the following conditions are satisfied:

(a) The seller ceases to engage in the private practice of law in the geographic area in which the practice has been conducted;

(b) The entire practice is sold to one or more lawyers or law firms;

(c) The seller gives written notice to each of the seller’s clients regarding:

(1) the proposed sale;

(2) the client’s right to retain other counsel or to take possession of the file; and

(3) the fact that the client’s consent to the transfer of the client’s files will be presumed if the client does not take any action or does not otherwise object within ninety (90) days of receipt of the notice.

If a client cannot be given notice, the representation of that client may be transferred to the purchaser only upon entry of an order so authorizing by a court having jurisdiction. The seller may disclose to the court in camera information relating to the representation only to the extent necessary to obtain an order authorizing the transfer of a file.

(d) The fees charged clients shall not be increased by reason of the sale. More ›

Only Current Shareholder can Bring Derivative Legal Malpractice Claim Against Counsel for the Corporation

BoardroomThis Illinois Supreme Court in September 2015 held that to bring a derivative legal malpractice claim against counsel for a corporation, the plaintiff must have been a shareholder at time of the alleged negligence, and he or she must maintain his or her status as a shareholder throughout the entire pendency of the action. Stevens v. McGuireWoods LLP, 2015 IL 118652. The court noted that even assuming plaintiffs were successful, they could not have collected personally on any judgment entered against corporate counsel on derivative claims because at the time they filed the legal malpractice action against the defendant law firm, plaintiffs had relinquished any and all ownership in company. Therefore, the defendant law firm's alleged failure to assert contested claims against corporate counsel in a timely manner caused no injury to plaintiffs in their individual capacities. The court reaffirmed the well-established principle that a legal malpractice plaintiff must have suffered "actual damages." See also Eastman v. Messner, 188 Ill.2d 404, 721 N.E.2d 1154 (1999).

The Stevens court did not, however, address the attorney-client privilege issues which will surely surface in derivative claims, such as where the corporation (through its current management or "control group" refuse to waive the attorney-client privilege).

Arizona's Mediation Process Privilege Bars Malpractice Allegations

In its September 22, 2015 opinion in Grubaugh v. Blomo ex rel. Cnty. of Maricopa, No. 1 CA-SA 15-0012, 2015 WL 5562347, the Court of Appeals of Arizona held that the state’s mediation process privilege was not waived when plaintiff sued her attorney for malpractice arising out of alleged substandard advice given during a family court mediation. In addition, the court held that any of plaintiff’s allegations that were dependent upon privileged information should be stricken from the complaint. This case follows a number of others across the country that have been criticized for insulating attorneys from liability for their actions during the course of mediation. More ›

Illinois Court Finds LPL Insurer has no duty to Defend Action for Injunction or for fees Unrelated to Malpractice Claim

An Illinois appellate court ruled in Illinois State Bar Ass'n Mutual Ins. Co. v. Burkart, No. 4-14-1036, 2015 WL 5657857 (Ill App. 4th Dist. Sep. 24, 2015) that a malpractice insurer had no duty to defend against an action seeking injunctive relief or an action for fees unrelated to a professional negligence claim. More ›

Seventh Circuit Warns: “When in Doubt, Disclose.”

The Seventh Circuit sends a message to the bar regarding potential conflicts of interest in a class action matter, reaching an issue raised for the first time on appeal: “when in doubt, disclose.” More ›