Thursday Attorney Malpractice Update 4/3/08
Posted: April 3rd, 2008
By: Andrew Bluestone, Esq.
Category: Attorney Malpractice, The News Beat

Another Big Law Bankruptcy Legal Malpractice Case

Bankruptcy Legal Malpractice cases are on the rise.  Trustees have greater powers than do regular plaintiffs, there are longer statutes of limitation in Bankruptcy situations, and the numbers are really big.  Here is a case from the NY Lawyer site.

"Gibson, Dunn & Crutcher is the latest law firm to be named in a suit stemming from the breakdown of the commodities firm Refco, Inc. The action, filed by liquidators and the trustee for Sphinx Funds, a family of funds that collapsed after doing business with Refco, was filed March 8 in New York trial court; a notice of removal to federal district court in Manhattan was filed by one of the defendants March 28. 

Refco filed for bankruptcy in October 2005. Several lawsuits and criminal proceedings have followed. This latest action claims the funds lost $263 million as a result of Refco¹s meltdown; Gibson, Dunn's representation of various Sphinx entities also contributed to the loss, the suit claims. 

Gibson, Dunn represented Sphinx Funds and its investment manager, PlusFunds, Inc., as well as fund directors and entities controlled by those directors. 

Work for those entities was a conflict of interest that the firm never disclosed, the complaint says. The plaintiffs also charge Gibson, Dunn with helping to conceal the nature of numerous loans made by Refco to Sphinx directors that were in fact payments to those directors in exchange for Sphinx's business with Refco. "

Patent Law, Legal Malpractice, State Court and Wisconsin

Here , in AccuWeb, Inc., Raymond Buisker, v.  Foley & Lardner, Harry C. Engstrom, Quarles & Brady LLP and Nicholas Seay, we find one of the rare state court patent legal malpractice cases.  Generally, as patent law is a federal question, one of the parties either brings the action in Federal District Court or removes it there.  Here is the decision on a motion for summary judgment:

"This case centers on whether AccuWeb, at the summary judgment stage, put forth sufficient evidence to raise a genuine issue of material fact on the question of whether the alleged failure of the Respondents to prevent the premature expiration of AccuWeb's 5,072,414 patent (the 414 patent) was a substantial factor in causing AccuWeb actionable damages, thus preventing summary judgment. The second issue is whether AccuWeb presented sufficient evidence to allow a fair and reasonable estimate of the amount of such damages, so that there was a genuine issue of material fact, thus preventing summary judgment as to the amount of those damages. We address the second issue because it was addressed by the circuit court. This case involves the interpretation and application of Wis. Stat. § 802.08 (2003-04),[2] the Wisconsin summary judgment statute. "

$ 3.7 Million Verdict is "Too Small" in Legal Malpractice Case
We've been following this case.  Bank is scammed by person running a structured settlement company, and clients' structured settlement funds are lost.  Bank sues the attorney who recommended the structure guy, and on Friday, a jury awarded the bank $ 3.7 million in damages.

Here is the story of the verdict in Magna v. Coburn.

"The day after he won $3.7 million in a legal malpractice case, East St. Louis lawyer Rex Carr said he would ask that part of the case be retried because he believes the jury should have awarded his client more money. 

Carr had asked the jury for more than $11 million for his client, Regions Bank, then named Magna Bank. The bank had sued the St. Louis law firm of Thompson Coburn, alleging that bad legal advice opened the bank to liability in the meltdown of financial scam artist James Gibson in the 1990s. 

Gibson's scheme involved the establishment of trusts for people, mostly accident victims, who had won large civil suit awards or settlements. Gibson initially invested the money with various banks, including Magna, but eventually took direct control of the money through a series complicated court cases. 

Gibson then lavishly spent the money on himself and his family and squandered most of it on a failed attempt to resurrect the National supermarket chain. In the end, 155 investors lost some or all of their funds, more than $60 million at the time and more than $150 million in promised payments over time. Gibson was sent to prison for 40 years. "

Post a Comment   |   (0) Comments  |   Permanent Link  Go Back

Comments
There are no comments for this post.