Friday, June 18, 2010

Dismissed For Cause

The New York Appellate Division for the First Judicial Department affirmed the dismissal of claims brought by a former partner against his law firm:

The Partner alleged in the first action, inter alia, that his former employer, KBTF, defamed him personally, as well as his business reputation, by KBTF's issuance of a press release stating that he had been "terminated for cause," ". . . because of extremely inappropriate personal conduct," and through a subsequent statement by a KBTF partner that the termination had occurred after a "thorough" and "weeklong" investigation by KBTF. The press release and statement were made after a certain publication reported that the Partner had joined his new firm "after jumping ship" from KBTF, taking with him certain important clients, and that the new firm had "nab[bed]" him. When the trade publication did not issue what KBTF regarded as a sufficient correction, KBTF published the allegedly defamatory statements quoted above.

The IAS court correctly dismissed the Partner's defamation claims upon finding that the Partner's pleading, and a December 2007 e-mail which he had sent to a senior partner at KBTF, effectively admitted that he was terminated for cause due to his inappropriate personal conduct while at KBTF. A review of the pleadings and documentary evidence submitted supports the motion court's conclusion that KBTF's alleged defamatory remarks were substantially true...KBTF's use of the term "extreme" to qualify the Partner's inappropriate conduct, when viewed in the context of KBTF's warranted response to the new firm's initial announcement, would be viewed by a reasonable reader as constituting opinion, and thus would be privileged.

The Partner failed to state a claim for tortious interference with business relations, inasmuch as his pleadings asserted that KBTF's alleged defamatory statements were made to gain, inter alia, economic advantage, and were not published solely out of malice; nor, for the reasons stated above, can the Partner prevail on this claim on the theory that KBTF employed "wrongful means" in making the challenged statements...The Partner's injurious falsehood claim was insufficiently pleaded absent viable allegations that false and disparaging statements were made which harmed the Partner's property or business reputation...The Partner's equitable claim alleging KBTF was unjustly enriched because he performed "transition" services for KBTF without pay was properly dismissed inasmuch as the parties' partnership agreement covered compensation issues for partners both in good standing with the firm, and those like the plaintiff, who had been expelled.

The court properly dismissed the causes of action in KBTF's complaint given the vague, boilerplate allegations of damages which were insufficient to sustain the causes of action asserted therein(citations omitted).

(Mike Frisch)

June 18, 2010 in Law Firms | Permalink | Comments (0) | TrackBack (0)

Monday, April 26, 2010

Another Disqualification Overturned

The Maine Supreme Court vacated a judgment disqualifying a Washington, D.C. law firm in a matter in which an employee claimed a hostile and discriminatory work environment while employed at the Maine Education Association.

The Association hired the law firm to conduct an investigation of the employee's allegations. The employee was interviewed by a firm attorney with her own counsel present. The attorney advised the employee that he did not represent the Association but was conducting an independent investigation. The employee claimed, but the interviewing attorney denied, that she was assured of confidentiality. The attorney later substantiated the employee's allegations of discrimination.

When the employee filed a complaint against the Association, two other law firm attorneys entered an appearance as pro hac vice counsel. The attorney who had interviewed the employee had departed. The trial court granted the employee's motion to disqualify the law firm in the litigation. 

Here, the court concluded that the moving party has the burden of establishing an affirmative ethical rule violation that would result in actual prejudice. General allegations will not suffice. The trial court must make express findings in that regard. The moving party had "failed to point to any particular prejudice she has suffered or will suffer and...the [trial] court made no such finding of actual prejudice."

A concurring justice would find the question closer than the majority and views it as "better practice not to have the same firm perform a discrimination investigation and represent the employer in any resulting litigation."

A dissenting justice would affirm the disqualification order, concluding that the interviewing attorney had misled the employee into believing he was an independent investigator and had disclosed information to the employer in violation of his commitment to her. The dissent also concluded that the attorney-investigator may be a necessary trial witness. (Mike Frisch)

April 26, 2010 in Interviewing, Law & Business, Law Firms | Permalink | Comments (0) | TrackBack (0)

Not Substantially Related

The New Jersey Supreme Court has reversed an order disqualifying a law firm from representing a municipality in defense of tax appeals during 2006-2007. The court concluded that the prosecution of individual taxpayer' 2009 tax appeals against the municipality was not "substantially related" to the matters handled on behalf of the municipality. The law firm had been disqualified by the Tax Court and the order was affirmed by the Appellate Division.

The court here found disqualification unwarranted because the law firm did not receive confidential information from the municipality that could be used against it in the taxpayer appeals: "In this record, the City has not met its burden of proving that, in fact, the current and former representations are 'substantially related. ' The superficial similarity of the subject matter of both representations-- the propriety of real estate tax assessments-- does not withstand closer scrutiny." The party seeking disqualification was unable to point to any confidential information that could be used against it. (Mike Frisch)

April 26, 2010 in Current Affairs, Law & Business, Law Firms | Permalink | Comments (0) | TrackBack (0)

Tuesday, March 9, 2010

Claims Against Referring Firm Reinstated

A law firm that had represented a client sued the client for unpaid fees. The plaintiff firm also sued the law firm that had referred the client, claiming that the defendant law firm had represented that their clients (the Nassers) guaranteed payment of their fees. Plaintiff appealed the dismissal of claims against the referring law firm.

The New York Appellate Division for the First Judicial Department held that the claims were viable:

The complaint alleges that defendants-respondents represented to plaintiff law firm that they had authority from the Nassers to promise payment of $75,000 of the legal fees incurred by plaintiff's client when, in fact, they lacked the authority to bind the Nassers. Thus, the complaint alleges a viable claim for breach of the implied warranty of authority. The complaint also alleges that defendants-respondents falsely represented to plaintiff law firm that they specifically discussed the subject matter of their authority and representations with the Nassers. Thus, the complaint alleges a viable clam for tortious misrepresentation of authority and assurances of payment.

To the extent the motion court relied on the principle of apparent authority, lack of consideration and the statute of frauds to dismiss these causes of action, such was error. The doctrine of apparent authority is irrelevant because the fourth and fifth causes of action are not seeking to hold the principals (the Nassers) liable on the ground that defendants-respondents had apparent authority from the Nassers to make promises of payment. Rather, these causes of action are seeking to hold the agents, defendants-respondents, liable for contracts or representations they purported to make on behalf of the principal (the Nassers) while acting without authority from the principal. Therefore, the fact that the Nassers never manifested to plaintiff law firm that defendants-respondents were authorized to act on the Nassers' behalf has no bearing on the viability of the fourth and fifth causes of action. Moreover, regardless of whether or not there was consideration running to the Nassers, defendants-respondents can still be held liable for their own tortious conduct in making deliberate misrepresentations of fact that they had authority to make the promises that the Nassers would pay $75,000 of the legal fees incurred by plaintiff's client (see Restatement (Third) of Agency §§ 6.10, 7.01 [2006]). In addition, the statute of frauds does not come into play since the fourth and fifth causes of action are not seeking to enforce the unwritten agreement by the Nassers to pay plaintiff's client's legal fees against the Nassers. These causes of action state a claim against the defendants-respondents regardless of whether there is an enforceable contract with the Nassers.

The sixth cause of action against defendants-respondents for tortious interference with defendant Jacques Nasser's contract with plaintiff law firm to pay $37,500 of the legal fees incurred by plaintiff's client was also improperly dismissed by the motion court. In order for there to be a viable claim there must be a valid contract between Jacques Nasser and plaintiff law firm. Pursuant to General Obligations Law § 5-701(a)(2), every agreement, promise or undertaking which is a special promise to answer for the debt of another is void unless it is in writing. Under a long-standing exception to the statute of frauds, however, the promise need not be in writing if it is supported by new consideration moving to the promisor and beneficial to him, and the promisor has become in the intention of the parties a principal debtor primarily [*3]liable (see Martin Roofing v Goldstein, 60 NY2d 262, 264 [1983], cert denied 466 US 905 [1984]; Carey & Assoc. v Ernst, 27 AD3d 261 [2006]). At the very least, the allegations in the complaint raise an issue of fact concerning whether Jacques Nasser agreed to act as a guarantor in the event plaintiff's client did not pay her legal fees, in which case there was no enforceable contract, or whether in seeking to secure the benefit of the cooperation of plaintiff's client in connection with the lawsuit against him by her employer, Jacques Nasser offered to lift the burden of the obligation to pay legal fees from plaintiff's client and pay the law firm directly, in which case the contract would not be barred by the statute of frauds (see Rowan v Brady, 98 AD2d 638, 639 [1983]). Therefore, the sixth cause of action for tortious interference with contract is reinstated.

Finally, the motion court erroneously dismissed the seventh cause of action against defendants-respondents which alleges tortious interference by defendants-respondents with the attorney-client relationship between plaintiff law firm and its client, defendant Srour. Insofar as the complaint alleges that defendants-respondents, knowing that Srour was represented by plaintiff law firm, met with Srour alone, without informing plaintiff law firm of the meeting, and approximately three days later, Srour discharged plaintiff law firm, it is sufficient at this stage of the proceedings, to state a viable claim, and therefore the seventh cause of action is reinstated.

(Mike Frisch)

March 9, 2010 in Billable Hours, Law & Business, Law Firms | Permalink | Comments (0) | TrackBack (0)

Thursday, March 4, 2010

Termination, Not Hints, Triggers Wrongful Discharge Claim

The District of Columbia Court of Appeals affirmed the dismissal of a former law firm associate's claim of failure to accommodate a disability on grounds that the claim was time-barred. However, the court reversed the dismissal of a related claim of wrongful discharge and remanded that claim for trial on the merits.

The associate was hired by the law firm in 2000. While attending a firm trial training program in April 2001, her dominant hand was burned. She suffered extreme pain and medical limits on her activities and took a month leave of absence for treatment. She requested a number of accommodations on her return and alleges that she was told by her supervisor "that if she was still injured, she was 'of no use to anyone.' " After a second leave of several months, she claimed that she was told not to seek substantive billable work until she could work without restrictions. There were further requests for accommodations and performance reviews. The associate attorney received notice of discharge from the firm in late October 2002.

The court here concludes that the statute of limitations for wrongful discharge began to run with the formal termination. Earlier threats or hints of poor performance do not trigger the statute. (Mike Frisch)

March 4, 2010 in Billable Hours, Law & Business, Law Firms | Permalink | Comments (0) | TrackBack (0)

Tuesday, March 2, 2010

Scrambled Eggs And Malpractice

The Maryland Court of Special Appeals recently held that a trial court order that denied a motion to quash a subpoena on grounds of attorney-client privilege was not subject to an immediate appeal. One law firm had represented a divorcing wife and had secured the divorce. One aspect of the divorce obligated the husband to continue to designate the ex-wife client as a beneficiary of an insurance policy. He did not. A second lawyer assumed responsibility for the insurance issue, which resulted in a settlement.

The first law firm sued the client for unpaid legal fees. The former client countersued for legal malpractice based on the contention that the first firm had failed to notify the insurer of the provision that obligated the ex-husband to continue her as the beneficiary. The first firm claimed that the loss was attributable to the improvident decision to settle by the client and the second attorney.

The law firm sought to depose the second lawyer. The motion to quash asserted attorney-client privilege. The trial court denied the motion to quash on grounds of waiver of the privilege.

The court here concluded that the trial court order could not be appealed at this juncture. The trial judge's ruling did not conclusively resolve any issue and can be reviewed if any appeal is taken. Further, the advice given to the client by the second attorney is central to the disputed issues in the litigation. As the court observes: "The eggs cannot be unscrambled." (Mike Frisch)

March 2, 2010 in Clients, Law Firms, Privilege | Permalink | Comments (0) | TrackBack (0)

Monday, February 22, 2010

Imputed Conflicts And Contract Attorneys

An ethics opinion issued this month by the Legal Ethics Committee of the District of Columbia Bar is summarized below:

The imputation of a temporary contract lawyer’s individual conflicts to a hiring firm under D.C. Rule 1.10 depends on the nature and extent of the lawyer’s relationship with the firm and the extent of the temporary lawyer’s access to the firm’s confidential client information. A temporary contract lawyer who works with the same firm sporadically on a few different projects, or on a single project for a longer period of time, would not be “associated with” the hiring firm if the firm does not have or otherwise create the impression that the temporary contract lawyer has a continuing relationship with the firm, and the firm institutes appropriate safeguards to ensure that the temporary contract lawyer does not have access to the firm’s confidential client information except for the specific matter or matters on which he is working.

In addition, the temporary contract lawyer and the hiring firm must protect the confidentiality of all client information, and the firm must take appropriate steps to avoid obtaining the confidences and secrets the temporary contract lawyer learned during his former employment.  

(Mike Frisch) 

February 22, 2010 in Law Firms, Professional Responsibility | Permalink | Comments (0) | TrackBack (0)

Tuesday, January 5, 2010

Conference Announcement on Law Firm Evolution; Timely WSJ Article Begging the Question: "Do Lawyers Evolve Sufficiently to Use the Technology Placed at Their Fingertips?"

Posted by Jeff Lipshaw

Carole Silver (Georgetown) passed along an announcement for  “Law Firm Evolution:  Brave New World or Business As Usual.”  The conference will take place at Georgetown Law Center in Washington, beginning with an evening reception on March 21st and running through lunch on March 23rd.  Speakers will include Richard Susskind (author of “The End of Lawyers?” and “The Future of Law”), but more importantly, friends like our own Bill Henderson, David McGowan, Michele Beardslee, co-author Larry Ribstein, and Paul Lippe of Legal OnRamp.  Other notables:  Jeff Lehman, former dean of the Michigan Law School, Cornell president, and current dean of the Peking University School of Transnational Law, David Wilkins, and Aric Press of the American Lawyer.

All of which segues nicely into an article entitled "Using Web Tools to Control Legal Bills; Big Law Firms Turn to Technology to Provide Clients With Real-Time Expenses, Automate Tasks" from the Wall Street Journal this morning which trumpets "new technology" about which I was harping during the law firm beauty contests our staff held for purposes of choosing "preferred providers" back at the beginning of this decade (which began on 1/1/2001 and doesn't end for another year).  Pardon my occasional slip into facetiousness, but what follows ain't a technology issue, except as it relates to the technology extant in the six inches between a lawyer's ears. 

Let me provide some background here.  In 1998, my old law firm, Dykema Gossett PLLC (now Dykema "A Firm Unlike Any Other") installed billing software that allowed any human being (I include lawyers) to open a program in the morning, keep it open, and, without resorting to paper time sheets, memory, Post-It notes, or scrawls on one's body (like that guy in Memento), to record one's billables in, as we have come to say, REAL TIME.  The upshot of this was the potential of fine grapes in/fine wine out:  somebody could actually tell a client in REAL TIME how much a matter was costing. 

Fast forward a couple years to about 2002.  I'm now the general counsel of a public company.  Put aside whether it's a good thing for society - public companies report their earnings every three months, and whether they give "guidance" or not, securities analysts make models in which they predict what those earnings will be.  On the inside, the company knows what those estimates are and, all other things being equal, tries not to rub too many analysts' noses in the dirt by surprising them on the downside.  In short, you can't rule out contingency and surprise, but the whole point of having information available to management about sales, costs, trends, weather, the macro-economy, etc. is to plan for it.

Continue reading

January 5, 2010 in Conferences & Symposia, Law & Business, Law Firms | Permalink | Comments (0) | TrackBack (0)

Thursday, December 24, 2009

Remand In Litigation over Fees

The District of Columbia Court of Appeals has issued its decision in the litigation between Douglas Rosenthal and his former firm Sonnenschein Nath & Rosenthal. The case involves a dispute primarily over fees for representation against Libya arising out of the destruction of Pam Am 103 over Lockerbie. The trial court had awarded Rosenthal $3.7 million in compensatory damages. The firm won an award against Rosenthal and his new firm for tortious interference.

At issue were claims for compensatory damages for two periods of time. The court held that the jury was presented with sufficient evidence that the firm had been "unevenhanded and thus unreasonable" in setting compensation for the second period. Rosenthal's retirement did not preclude him from suing the firm. The evidence was insufficient to award punitive damages against the firm. 

The court remanded for a new trial on compensatory damages for the second time period. and reversed the award to the firm on the  tortious interference claim. Rosenthal was given the option of a new trial on compensatory damages or accepting an award as reduced by the court's opinion.

The decision can be accessed through the court's web page (Rosenthal v SNR) and was decided today. (Mike Frisch)

December 24, 2009 in Law & Business, Law Firms | Permalink | Comments (0) | TrackBack (0)

Tuesday, December 22, 2009

No Fee For You

A recruitment firm sent an unsolicited resume of a lawyer who specialized in Korean practice to a New York law firm. The firm had no Korean practice in its New York office but later hired the applicant for its Washington office through a different recruiter. The first firm sued for a fee. The New York Appellate Division for the First Judicial Department affirmed the dismissal of the suit:

As it is undisputed both that the New York partner did not know that the candidate was being interviewed by the Washington office, and that the Washington office did not know prior to interviewing the candidate that his resume had been sent to the New York partner, the required assent necessary to establish an implied contract cannot be inferred. There was no "meeting of the minds" (I.G. Second Generation Partners, L.P. v Duane Reade, 17 AD3d 206, 208 [2005]) sufficient to establish an implied contract pursuant to which defendant agreed to pay plaintiff a fee even if there was no causal connection between plaintiff's submission of the candidate's resume and defendant's decision to interview and hire the candidate.

(Mike Frisch)

December 22, 2009 in Law Firms | Permalink | Comments (0) | TrackBack (0)

Tuesday, December 15, 2009

No Agreement To Arbitrate

An attorney was hired as "of counsel" of another attorney under a one-year employment contract on November 1, 2005. The contract authorized discharge for cause and had an arbitration clause. The employment relationship had "issues" but extended past the fixed term. Eventually, the employed lawyer was discharged with notice given in August 2007. The parties disagree as to the reasons. The employed lawyer sued the employing lawyer on claims that included wrongful discharge. The employing lawyer moved to dismiss, invoking the arbitration clause.

The Washington State Court of Appeals, Division I held that the there was no basis to conclude that the lawyers agreed to extend the arbitration provision beyond the fixed term:

Where a fixed-term employment contract expires and the employee continues to render the same services provided under the previous agreement, a court will presume that the employee is serving under a new, implied contract having the same terms and conditions as contained in the expired contract. However, where it is clear that the implied contract does not have the same terms and conditions as the earlier agreement, there is no basis
to presume that the contracting parties necessarily renewed any specific term of
the prior agreement. Because the evidence in the record and the pleadings
herein establish that Judith Lonnquist and Reba Weiss did not completely renew
the terms of Weiss's written, fixed-term employment contract after Lonnquist
terminated it, there is no basis to presume that the parties subsequently entered
into an implied agreement to arbitrate Weiss's employment-related claims as was provided for in the terminated contract. Inasmuch as a court cannot compel litigants to arbitrate claims unless they agreed to do so, the trial court correctly denied Lonnquist's motion to compel arbitration. Accordingly, we affirm.

(Mike Frisch)

December 15, 2009 in Associates, Billable Hours, Law Firms | Permalink | Comments (0) | TrackBack (0)

Friday, November 13, 2009

New Data on BigLaw Contraction: Patterns of Winners and Losers

[posted by Bill Henderson, cross-posted to ELS Blog]

A careful analysis of the recently released National Law Journal 250 reveals some surprising trends.  The NLJ reports that the nation's largest 250 firms (by lawyer headcount) shrank by 4%. Yet, when broken down by geography (see figure below, click on to enlarge), nearly half of the losses (2,096) were concentrated in the 45 firms headquarters in New York City.  And another 20% (883) fell on the 17 NLJ 250 firms headquartered in Chicago.NLJ250geography2009

To put those figures in perspective, for 2008 (the baseline year), NYC- and Chicago-based firms only accounted for  24.7% and 14.7% respectively of the NLJ 250 total lawyer headcount.  In contrast, DC-based firms accounted for 9.7% of the NLJ 250 universe in 2008 but only 3.8% (161) of the total contraction.  The disparate geographic impact suggests that the reductions-in-force are probably due disproportionately (or overwhelmingly) to the decline in the volume of corporate transactions and woes in the banking and insurance sectors.  Among major markets, San Francisco-based firms shrank the least, though this glass-half-full news is probably the result of the dissolutions of Thelen Reid and Heller Ehrman in late 2008, which were both headquartered in the Bay Area. 

On comparative basis, the middle-market firms appear to be thriving.  Collectively, there was a 0.6% increase in the number of lawyers in the 91 NLJ 250 firms based outside the Top 10 markets. In contrast, firms headquartered in Top 10 markets did uniformly worst.  Below is a ranking based on percentage contraction:
  1. New York City (45 firms)    -7.0%   
  2. Dallas (7 firms) -5.9%
  3. Houston (4 firms) -5.4% 
  4. Philadelphia (15 firms)                -5.4% 
  5. Atlanta (9 firms) -5.3% 
  6. Chicago (17 firms)                      -4.7% 
  7. Los Angeles (11 firms) -2.7% 
  8. Boston (10 firms) -2.1%
  9. Washington DC (18 firms)           -1.6%
  10. San Francisco (9 firms)               -0.1% 
Firm size appears to be a major explanatory variable, particularly for associates.  Here is the breakdown of changes in lawyer headcounts by size of firm:
NLJ250change2009 

So what is the bottomline analysis?  I think the slowdown in the economy has made the largest firms the most vulnerable to price pressure from large corporate clients.  The largest firms have the highest cost structure (rents and associate pay), and there is some doubt whether there is a corresponding value-add for their higher fees.  At the high end, the market is pretty crowded.  An international footprint is not necessarily a competitive advantage when 20+ of firms have the same high fixed costs and similar lawyer credentials.  Not surprisingly, a lot of desirable legal work that does not require a multi-office international platform is migrating to firms further down the AmLaw/NLJ 250 food chain.  (These observations, by the way, track Larry Ribstein's The Death of BigLaw analysis.)  Indeed, anecdotal evidence from my informal network suggests that boutiques are booming holding their own [NOTE: after the original post, three additional members of my informal network suggested that boutiques were not booming but, instead, hurt less badly].

Folks, we are in uncharted waters.  The structure of the corporate bar is changing rapidly.  The giants are vulnerable.

November 13, 2009 in Law Firms | Permalink | Comments (0)

Tuesday, November 10, 2009

Fee Dispute Appeal Oral Argument

The District of Columbia Court of Appeals will hear oral arguments this Friday (November 13th) in a case described in a June 2008 report reprinted below from Law.com:

In March, a D.C. Superior Court judge awarded Douglas Rosenthal, a former Sonnenschein Nath & Rosenthal antitrust partner, only part of the compensation he claimed was owed to him by the firm.  Now, nearly three months later, Judge Melvin Wright has whittled down that award from more than $3 million to $65,639.

Rosenthal (who is not related to the Rosenthal in the firm's name) sued his ex-employer for $8.5 million, claiming he had not been fairly compensated for representing the families of those killed in the 1988 bombing of Pan Am Flight 103 over Lockerbie, Scotland. That contingency work generated nearly $17 million for Sonnenschein. Rosenthal also claimed he was owed origination credit for Sonnenschein's representation of Sun Microsystems against Microsoft Corp. That work produced $20 million in fees for the firm.

After a 2 1/2-week jury trial, Judge Wright entered judgment in favor of Rosenthal on March 28 to the tune of $3.73 million. However, Sonnenschein was also awarded $300,000 in its counterclaim against Rosenthal and his new firm, Constantine Cannon. Sonnenschein filed that claim because it said Rosenthal and Constantine had interfered with clients when Rosenthal left in 2005.

Sonnenschein filed a motion on April 10 arguing that Wright had not properly adjusted the jury's $3.73 million award. Sonnenschein said the court agreed that it would subtract the amounts that Rosenthal actually earned during the years in question from the amounts the jury determined he should have been compensated. According to Sonnenschein's motion, after that calculation, the damages award becomes $365,639. After also subtracting the $300,000 for Sonnenschein's counterclaim, judgment for Rosenthal is reduced to $65,639. Last Thursday, Wright granted the motion to decrease the damages award to that amount.

One of Rosenthal's lawyers, Constantine Cannon partner Gary Malone, says he believes the judge "erred" and plans to appeal the decision within the next month. Rosenthal is also represented by Constantine partner Robert Begleiter. Michele Roberts, a partner at Akin Gump Straus Hauer & Feld, and James Hamilton, a partner at Bingham McCutchen, represent Sonnenschein.


First reported in The BLT: The Blog of Legal Times

The oral argument may be heard in real time by access through following link. Click on the link highlighted in yellow to hear the agrument. (Mike Frisch)

November 10, 2009 in Law Firms | Permalink | Comments (0) | TrackBack (0)

Saturday, November 7, 2009

A Fun Read

Jayanth Krishnan at Indiana (Bloomington) is expanding his ouevre of comparative legal profession studies with his latest on SSRN, The Joint Law Venture: A Pilot Study (here).  As with his other work, this one's an interesting (and, yes, fun) read.  Congrats, Jay!

(Posted by Nancy Rapoport)

November 7, 2009 in Comparative Professions, Current Affairs, Ethics, Law & Business, Law & Society, Law Firms, Professional Responsibility, Rapoport | Permalink | Comments (0) | TrackBack (0)

Tuesday, October 13, 2009

Sentimental Journey

In an action brought by the personal representative (and later widow) of a deceased law partner, the South Carolina Supreme Court held that the claims relating to the continuing use of the attorney's name were properly dismissed. The court described the basis of the civil complaint:

Julian Gignilliat (Gignilliat) was a founding partner in 1968 of what became the GSB law firm.  The firm did not have a written partnership agreement.  Gignilliat was diagnosed with a serious illness in 2001.  Gignilliat died on June 22, 2002.  It is undisputed that Gignilliat, cognizant of his terminal illness, requested that GSB continue to use his name after his death and that GSB not be sued

The Personal Representative (PR) of the Estate of Julian Gignilliat filed an action against GSB and six partners in the firm at Mrs. Gignilliat’s request.  The PR alleged GSB continued to use and profit from the Gignilliat name without the consent of Gignilliat’s estate and without making compensation for its use. 

A Consent Order was filed wherein the PR of the estate assigned Mrs. Gignilliat the sole right to any of the estate’s claims arising out of the complaint.  Subsequently, Mrs. Gignilliat filed an amended complaint naming herself as the plaintiff in which she sought a declaratory judgment regarding the defendants’ right to continue using the Gignilliat name without consent, and she asserted claims for (1) infringement on the right of publicity, (2) conversion, (3) unjust enrichment, and (4) quantum meruit.  She sought damages and an injunction preventing further use of the Gignilliat name without compensation.

The court concluded that any sentimental value attached to the deceased attorney's name did not form a basis for quantum meruit recovery. (Mike Frisch)

October 13, 2009 in Law Firms | Permalink | Comments (0) | TrackBack (0)

Thursday, September 10, 2009

One Claim Survives

The District of Columbia Court of Appeals affirmed "in large part" the grant of summary judgment against a former programmer/analyst for Covington & Burling who sued for failure to reasonably accommodate her medical condition, hostile work environment, and termination in alleged violation of the D.C. Human Rights Act. The court found the hostile work environment claims to be time-barred but concluded that the reasonable accommodation claim remained viable. The former employee suffered from Crohn's disease. (Mike Frisch)

September 10, 2009 in Law Firms | Permalink | Comments (0) | TrackBack (0)

Monday, August 24, 2009

Ohio Outsourcing Opinion

From the web page of the Ohio Supreme Court:

Two recent advisory opinions from the Supreme Court of Ohio’s Board of Commissioners on Grievances & Discipline offer guidance on outsourcing legal or support services and whether a newly appointed domestic relations magistrate can continue to serve as a city council member.

Opinion 2009-6 finds that the Ohio Rules of Professional Conduct do not prohibit an Ohio lawyer or law firm from outsourcing legal or support services domestically or abroad, either directly to lawyers or nonlawyers or indirectly through an independent service provider. The opinion cautions, however, that applicable rules do impose significant ethical requirements.

Some of those ethical requirements include the circumstances and rules that require disclosing, consulting with a client and obtaining informed consent before outsourcing. Other considerations include being responsible for another lawyer’s violation of professional obligations and making reasonable efforts to ensure a nonlawyer’s conduct is compatible with the professional obligations of the lawyer. “The extent of supervision for outsourced services is a matter of professional judgment for an Ohio lawyer, but requires due diligence as to the qualifications and reputation of those to whom services are outsourced.”

The opinion also discusses reasonable fees and expenses in these arrangements and leaves the decision as to whether to bill an outsourced client as part of the legal fee or an expense to the lawyer’s professional judgment.

Opinion 2009-7 finds that it is improper under the Ohio Code of Judicial Conduct for a newly appointed full-time or part-time domestic relations court magistrate to continue serving out a term as an elected member of city council.

The opinion references Rules 1.2, 1.3 and 4.5 as offering guidance in answering the question posed.

The opinion also notes that there may be statutory compatibility issues to consider, but those are beyond the scope of the opinion.

(Mike Frisch)

August 24, 2009 in Law Firms | Permalink | Comments (3) | TrackBack (0)

Saturday, August 22, 2009

More from Paul Lippe on the Future of Law Schools

Posted by Jeff Lipshaw

Paul Lippe, who has been an agent provocateur (or thought leader, as they say) on the subject of legal education, has a follow up to his original Am Law Daily commentary to which our Bill Henderson linked a while back.  Follow the link and read it for yourself, but I'm not sure if the comments are available if you aren't a member of Paul's Legal OnRamp, so here's mine if you want to hit the "back" button on the browser after you read his column:

* * *

Like Ray [Campbell, visiting professor at Penn State Law School, who also commented - UPDATE: see his original comments below the fold], I'm a former Big Law partner, and I was the VP & GC of a Fortune 850, NYSE company. I'm less likely than Ray (based on his comments) to try to argue that today's paradigm of legal scholarship has anything more than a passing relevance to the in-the-trenches practice of law. But that's not really the point. Practitioners have to understand that we started down a particular path over a hundred years ago when C.C. Langdell came up with the idea that law could be derived inductively from the reading of cases, akin to the scientific method in other disciplines. (There's a social science term called "path dependency" and it has to do with how hard it is to get off a particular path once you are on it; as an example, if you take a job at the beginning of your career with Weil,Gotshal, you've created different path dependencies for future choices than if you take a job with Sooem & Servem in Elko, Nevada.) Law became a subject for instruction in research universities, not merely for the training of lawyers, and with that developed a community of legal scholars, developing, indeed evolving, their own standards for what constituted advancement in knowledge. For a long time, that had to do mainly with legal doctrine, and academic energy devoted itself to the great treatises, and the great doctrinal advances like the UCC.

The problem with comparing law to medicine (as I did, and to which Paul links) is that while the practice of medicine is both art and science, the science is still hard science, and, moreover, the linkage between cutting edge theoretical research and its practical application is far more intuitive. For example, my son has his name on a paper that deals with work on the very subtle science of diabetic neuropathy in cells - how at a molecular and cellular level does the glucose cause the problems it does? Even if the research isn't directed at a cure, we can understand it in the web of scientific research that leads to useful advances and human flourishing.

That's far harder to do in law, and one only needs to scan the titles of the last 2,000 or so papers uploaded onto SSRN to confirm the hypothesis. Moreover, there's a lot of work produced and in spotty quality because of two structural features of academic law as it has moved down its particular path: (a) the sheer number of law professors compared to other disciplines, because the training of professionals subsidizes the theoretical pursuits; and (b) the plethora of student-edited (and non-peer-reviewed) journals. In short, law as academic discipline is still finding its place in the world. Given a hundred years of path dependence, however, "solving" the problem of legal education isn't going to occur without some acknowledgment of the academic paradigm. For example, we could certainly, as a logical possibility, move to a world in which most lawyers are trained in vocational institutes, and make theoretical "law and..." part of more traditional humanities and social science Ph.D. programs. But I suspect that most lawyers like their ties to the status of research universities that spawned most of them.

Continue reading

August 22, 2009 in Comparative Professions, Law & Society, Law Firms, Teaching & Curriculum, The Practice | Permalink | Comments (4) | TrackBack (0)

Tuesday, August 4, 2009

Law Firm Letterhead Should Not Be Used For Debt Collection Letter

The U.S. Court of Appeals for the Fifth Circuit yesterday issued an opinion that should serve as a warning to lawyers involved in debt collection:  be careful what stationery you use.  Here is a nice summary (with permission) from the always-handy Fifth Circuit Civil News (its daily update by email), produced by Robert E. McKnight, Jr:

      Gonzalez v. Kay, No. 08-20544 (5th Cir. Aug. 3, 2009) (Jolly, Prado and Southwick): Gonzalez sued Kay's law firm and Kay for sending him a debt collection letter that, Gonzalez alleged, deceptively represented the law firm's handling of the debt as a legal matter, rather than simply as a collection matter, in violation of the Fair Debt Collection Practices Act. The FDCPA prohibits "a debt collector sending a collection letter that is seemingly from an attorney." The district court [S.D. Tex.] dismissed on the defendants' FRCP 12(b)(6) motion, concluding that the letter, though on law firm letterhead, sufficiently informed Gonzalez that none of the firm's attorneys had yet become involved in the matter and that the firm was simply acting as a debt collection agency. Holding: Reversed and remanded. "Because the 'least sophisticated consumer' reading this letter might be deceived into thinking that a lawyer was involved in the debt collection ["[a] letter from a lawyer implies that the lawyer has become involved in the debt collection process, and the fear of a lawsuit is likely to intimidate most consumers"], the district court prematurely dismissed Gonzalez's complaint." Judge Jolly dissented.

And Judge Prado wrote the majority opinion, reversing the dismissal.  [Alan Childress]

August 4, 2009 in Law Firms | Permalink | Comments (0) | TrackBack (0)

Thursday, July 16, 2009

Referral Fee Not Unethical

An attorney who joined a law firm had an agreement that the firm would pay him additional compensation for fees generated on matters he referred to the firm. He thereafter referred a case to the firm. When he left the firm and returned to his former firm (Wilson Elser), he did not receive compensation for the referral. The matter had come from Wilson Elser and was referred due to an apparent conflict of interest. The departing attorney brought an action against the law firm and prevailed in arbitration. The law firm appealed the arbitration award.

The Connecticut Appellate Court affirmed the award. The court rejected the suggestion that payment to the referring attorney violated the Rules of Professional Conduct because of the conflict of interest of Wilson Elser:

There never was a finding that the plaintiff had ever represented the client in the [referred] matter for his new firm. Compensation was owed to the plaintiff on the basis of the plaintiff's referring the...matter to the defendant, not for representing the client.

The arbitrator had correctly concluded that the ethics rules do not prohibit payment under circumstances where the lawyer receiving the fee later rejoins the firm that sent the case along due to a conflict. (Mike Frisch)

July 16, 2009 in Law Firms | Permalink | Comments (1) | TrackBack (0)