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Professional Liability Matters

Legal Developments and Risk Management Tips Impacting the Professional Liability Community.

LATEST INSIGHTS

• Legal Malpractice, Professional Liability Matters

Breach of Contract or Negligence: Does it Really Matter?

The Pennsylvania Supreme Court is set to entertain argument on an important appellate issue regarding the types of damages available to a plaintiff in a legal malpractice dispute. The decision may also highlight the fundamental differences, if any, between a malpractice suit grounded in tort or contract. In 2006, a national law firm agreed to represent the plaintiffs in the sale of a company that had incurred over $2 million in unpaid taxes. According to the plaintiffs, the law firm advised them that the sale would terminate their personal liability for the unpaid taxes. When the company’s assets withered after the transaction, however, the individuals that sold the company were held personally liable for all unpaid taxes and they turned to their former lawyers to recover.

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• Design Professionals (A&E), Professional Liability Matters

Legal Implications of Philadelphia’s Deadly Building Collapse

On June 5 two Philadelphia buildings collapsed, killing 6 and injuring at least 13 others. Contractors were in the process of demolishing an empty building when a four-story wall unexpectedly tumbled into the neighboring Salvation Army thrift store leaving a pile of debris and a cloud of smoke. Philadelphians, and beyond, are searching for answers and debating over who is to blame.

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• Professional Liability Matters, Risk Management

Anatomy of a Ponzi Scheme in a Post-Madoff World

The Ponzi scheme expired with the arrest of Bernie Madoff, right? Absolutely not. Ponzi schemes are alive and well. Many of these scams are reported but presumably many go unnoticed as criminals target the unsuspecting of millions. Apparently, Madoff’s 2008 arrest did little to dissuade others from engaging in similar crimes, although on a lesser scale. According to the SEC, which compiles Ponzi scheme data, these crimes continue at a disheartening rate.

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• Professional Liability Matters, Social Media Lessons

Facebook Post Lands Attorney in Hot Water

Fact: most professionals use social media in one form or another. Fact: Professional Liability Matters has previously warned of the various risks associated with LinkedIn, Facebook, and other online communications. Nonetheless, we continue to encounter seemingly countless reminders of missteps by professionals through presumably well-intentioned social media use. Recently, a Facebook post from a New York based attorney resulted in a fight over sanctions.

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• Cyber-Liability, Professional Liability Matters

Cyber-liability: An International Problem

Legislation was recently introduced in the Australian parliament that would require companies to publicly disclose data security breaches. The legislation is intended to protect the public by ensuring they are promptly notified if their personal data is compromised. Under the proposed legislation, an administrative agency in Australia would be empowered to levy fines of up to $1.7 million on companies that fail to comply with the disclosure requirements. Clearly, cyber-liability is an international problem.

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• Engagement Letters, Professional Liability Matters

The Break-Up: Knowing When the Professional Relationship is Over

All good things must come to an end…and most bad things too. The same must be true with a professional’s engagement. Professional Liability Matters has previously warned of the importance of clear engagement letters to set reasonable expectations regarding the scope of the relationship. But many professionals may take for granted the importance of clarifying when that relationship has come to an end. This is a key risk-management pointer to avoid malpractice.

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• Ethics, Professional Liability Matters, Risk Management

Alleged Conflict of Interest Leads to Malpractice Suit

A prestigious and well regarded Philadelphia based law firm was recently named in a multi-million dollar malpractice lawsuit arising from an alleged conflict of interest. The plaintiff alleges that the firm’s relationship with her ex-husband’s employer resulted in a less than favorable outcome in her divorce proceedings. In 2009, the plaintiff wife retained the law firm’s matrimonial group to represent her in divorcing her husband who held a high position at Morgan Stanley. While the divorce case was proceeding, the law firm was retained by Morgan Stanley to represent it in an unrelated transactional matter. According to the malpractice complaint, this potential conflict of interest of simultaneously representing the wife and her husband’s employer was never disclosed and allegedly negatively influenced the manner in which the law firm handled the matrimonial case.

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• Professional Liability Matters, Risk Management

Insurers’ Communications Protected by Attorney-Client Privilege

A recent decision provides insight on the application of the attorney-client privilege to communications between an insurance professional, who was also an attorney, and the insured. Generally, all claims are assigned to an insurance professional to monitor and, if applicable, to strategize with insurance-appointed counsel. It is widely accepted that communications between defense counsel, the insurer, and the insured are protected by the attorney-client privilege pursuant to the so-called tripartite relationship. However, there is no privilege that applies to communications only between insurer and insured. The plot thickens, however, when the insurance professional is also an attorney.

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