Management and Professional Liability

Goldberg Segalla’s Management and Professional Liability attorneys have defended and counseled accountants through decades of major changes in statutory and case law, market forces, litigation trends, and the scope and standards of accounting business operations. With a deep bench of respected trial attorneys drawing on decades of experience, our professional liability lawyers are the go-to choice for numerous Top 50 national and regional accounting firms and trusted counselors to some of the leading accountants and accounting firm executives in the business.

We have counseled and defended accountants and accounting firms in disputes ranging from errors and omissions to accounting malpractice as well as lawsuits brought by acquirers or sellers of business entities, bank and insurance regulators, bankruptcy trustees, banks and other lenders, and investors in securities class actions; as well as investigations led by bankruptcy trustees, creditors’ committees, the Department of Labor (DOL), the Federal Bureau of Investigation (FBI), grand juries, the Internal Revenue Service (IRS), professional licensing bodies, the Securities and Exchange Commission (SEC), the Public Company Accounting Oversight Board (PCAOB), and state and local government entities.

Our professional liability defense experience covers matters involving:

• Alleged errors and omissions
• American Institute of Certified Public Accountants (AICPA) disciplinary proceedings
• Audits – including failure to follow accounting standards in planning and performing audits, lack of cross-checks, and failures or errors that result in continuing fraud by a bookkeeper, CFO, manager/executive, or others
• Breach of fiduciary duty
• Charities and nonprofits – including failure to administer grants and gifts
• Claims of accounting malpractice
• Company trusts – including failure to administer a company’s trust properly, and issues related to partner theft of client monies
• Conspiracy
• Errors and omissions cases
• Failure to advise a client of suspected fraud
• Failure to audit financial statements properly
• Failure to detect embezzlement
• Failure to file tax returns timely and/or file for an extension
• Flawed internal controls
• Fraud relating to the provision of accounting services
• Going concern opinions
• Loss of independence
• Accounting malpractice claims related to incorrect bankruptcy filing
• Misallocation of expenses
• Misrepresentation of financial statements
• Negligence
• Poor tax advice or negligent preparation of tax advice (including failure to advise a client properly on the tax consequences of an estate)
• Technology – including improper selection, installation, and implementation of accounting software

We have extensive experience protecting architects, engineers, land surveyors, energy firms, environmental engineers and consultants, and other design-focused clients against claims involving issues and allegations including design defects, errors and omissions, negligent provision of construction phase services, delay claims, faulty or defective material specification, indemnification and contribution, and professional negligence.

We have advised and represented clients in design-build and design-bid-build matters, in traditional projects and ones involving unusual complications and emerging technologies and risks. We’ve successfully litigated multimillion-dollar, high-exposure matters as well as sensitive but “smaller” dollar-number matters in which the greatest risks pertained to a client’s reputation and ability to continue working. We also counsel clients on the full range of risks specific to the design professional and engineering field, including environmental law matters and emerging environmental concerns, cyber risks and new technologies like drones and nanomaterials, intellectual property issues, government and partnership issues, transactional needs, and compliance with and investigations from all relevant state and federal regulatory agencies.

Our team has a particularly deep bench of attorneys with decades of experience serving the financial industry, where companies and officials face civil and administrative litigation brought under federal and state banking, consumer, and securities laws and regulations. We bring not only extensive experience litigating claims involving these rules and statutes, but also a thorough understanding of the individualized concerns and nuanced needs of public as well as privately held financial institutions. We defend banks, credit unions, captive insurance companies, and other financial institutions in a broad range of professional liability and other claims.

Our experience includes:

• Civil rights claims
• Class actions
• Collateral sales and replevin actions
• Commercial and business litigation claims
• Commercial loan workouts and restructurings
• Director and officer liability
• Employment litigation
• Errors and omissions
• Federal and state fair lending laws
• Fraud claims
• Insurance claims, including safe deposit box losses
• Predatory lending claims
• Regulatory compliance
• Secured transactions
• Surety and fidelity bonds
• Unfair and deceptive business practices

Goldberg Segalla professional liability lawyers have represented both institutional and individual clients in state and federal courts as well as in investigations led by the Federal Trade Commission (FTC), the Financial Industry Regulatory Authority (FINRA), the Securities and Exchange Commission (SEC), the U.S. Attorney’s Office for the Southern District of New York (SDNY), and the New York Attorney General (NYAG). We handle a broad range of matters, including securities, antitrust, employment, mergers and acquisitions, real estate, and shareholder and derivative class actions.

We represent clients in securities litigation and Financial Industry Regulatory Authority (FINRA) arbitrations nationwide, and also counsel clients through issues involving the full spectrum of securities industry-specific claims, investigations and enforcement actions. Our professional liability attorneys have experience handling federal antitrust and breach of contract litigation involving claims of misrepresentation related to an alternative trading system designed for high-frequency trading. Their work also includes cases concerning alleged stock option backdating, misstated earnings expenses, and anticompetitive monopolistic practices, among other complex matters.

With an authoritative understanding of the applicable regulations and an unsurpassed knowledge of how to navigate the process of arbitration and regulatory inquiries, we help clients minimize the impact of regulatory enforcement and customer complaints. Our services include:

• Providing legal counsel during regulatory inquiries
• Defending clients under investigation for regulatory matters
• Guiding clients through the arbitration process
• Using alternative dispute resolution methods to obtain quick settlements of claims
• Assessing and advising clients on evolving FINRA and other self-regulatory organizations (SROs) rules, regulations, and procedures

We have extensive experience representing debt collectors, debt collection law firms, and other entities in the debt business in a range of professional liability claims and class-action lawsuits brought under the Fair Debt Collection Practices Act (FDCPA). We understand the nuances of the FDCPA, the significant risks of massive damage awards and the FDCPA’s fee-shifting provision, the types of claims that can be brought under the act, and the unique risks and requirements pertaining to professionals and entities operating in this space. We have defended clients against claims arising from improper phone calls and dunning letters; actions taken in court and in post-judgment enforcement proceedings; alleged false or misleading representations; and actions alleged to harass, oppress, or abuse consumers.

FDCPA class action litigation has increased over the last decade, and uncertain economic conditions will only serve to continue or even exacerbate this trend. Backed by the full strength of our firm’s deeply experienced Class Action Litigation practice, we work with our clients from the outset of a matter to assess the potential risks and costs, and we frequently create strategies aimed at achieving early positive outcomes – including defeating class certification, securing dismissal of the class action complaint, or negotiating a favorable settlement when it is in the client’s best interests. We have defeated these lawsuits through successful motion practice, and when necessary, we have defended them through trial and appeal.

Our team represents directors and officers in high-value disputes throughout the U.S., in both federal and state courts, and around the world, and acts as trusted counsel providing timely and proactive advice on the full spectrum of risk-avoidance issues and emerging concerns relevant to directors and officers in virtually any industry. Whenever events occur in the life of a company that could make shareholders, customers, employees, or regulators unhappy, or could otherwise catch the attention of plaintiffs’ lawyers, directors and officers and their D&O insurers call on Goldberg Segalla.

Our D&O defense attorneys are ready to:

• Advise on litigation and regulatory risk
• Conduct internal investigations
• Conduct pre-suit investigations and pre-trial settlement negotiations
• Defend against regulatory investigations and enforcement by state and federal agencies
• Litigate or arbitrate any dispute that cannot be resolved through negotiation or mediation in cases involving single-plaintiffs or class actions, as well as derivative actions
• Provide guidance on compliance with the evolving data privacy requirements of companies and their officials in various industries
• Provide training to avoid pitfalls that can lead to litigation and regulatory action
• Resolve complex, high-exposure commercial and fraud-based disputes on behalf of businesses and their executives and board members

Our D&O clients include both public and private companies, nonprofit entities, governmental divisions, investment trusts, limited and general partnerships, and homeowner’s associations.

Drawing on the full resources of the firm’s robust and nationwide Employment and Labor practice group, we frequently counsel and defend clients facing the full gamut of Employment Practices Liability (EPL) matters, including emerging employment-related concerns and issues involving new statutes, regulations, agency guidance, and case law. We represent employers in state and federal court through various avenues of ADR, and before federal agencies such as the U.S. Equal Employment Opportunity Commission, the Department of Labor, the National Labor Relations Board, and the Occupational Safety and Health Administration, as well as local and state agencies.

Our ability to assist employers with training and risk management sets us apart. Attorneys across our national Professional Liability and Employment Practice Groups monitor breaking developments in case law and state and federal statutes, as well as emerging and evolving trends in EPL claims and judicial decision-making, and we provide our clients with valuable news and analysis through email alerts, webinars, and other communications on a rolling basis. We routinely perform risk management assessments and develop comprehensive claims and litigation avoidance strategies for our clients, and we offer on-site training – both to the executives and human resources departments of insured employers, as well as claims executives, underwriters, and third-party-administrators – on the full spectrum of employment issues. Long-term clients count on these value-added services to lower legal spending and reduce the incidence of distracting and potentially damaging EPL claims.

Goldberg Segalla defends insurers against claims brought by financial institutions and other corporate policyholders involving financial institution bonds, fidelity bonds, and crime policies. We serve fidelity clients throughout the nation and around the world, and our attorneys have directly handled matters in the United States, Europe, South America, and England.

We have decades of experience counseling insurers, conducting investigations, and handling first-party coverage litigation in matters involving:

• Account manipulation
• Catastrophe-related safe deposit box claims
• Check-kiting
• Computer fraud
• Embezzlement
• Employee dishonesty
• ERISA fraud
• Forgery
• Fraudulent acts
• Fund misdirection and misappropriation
• Improper wire transfers
• Lending losses
• Mortgage fraud
• Ponzi schemes and other financial scams
• Precious metal loss
• Safe-deposit box burglary
• Securities fraud
• Social engineering losses

Goldberg Segalla attorneys have counseled and defended health care professionals and businesses through some of the most sweeping regulatory changes, advances in technologies and practices, and trends in individual and class action litigation to affect the industry in the last two decades. Our winning team combines deep and diverse health care industry experience, a collaborative and holistic approach to legal services, and relationships with the nation’s top expert witnesses to find the ideal resolution for the claims our clients face – whether through early settlement or dismissal, mediation, trial, or appeal.

Our litigators have defended claims of obstetrical malpractice, improper surgical technique, neurologic misdiagnosis, psychiatric treatment, and a variety of hospital in-patient claims. They have tried to verdict scores of medical malpractice cases and other professional liability cases, defending physicians, administrators, nurses, physician’s assistants, a wide variety of medical specialists, and other health care professionals; as well as hospitals, long-term care facilities, specialty medical practices, and health care systems.

In addition, we provide our clients with timely alerts on case law and regulatory developments, and provide proactive risk-management counsel. We anticipate the manner in which the widespread use of electronic patient records, HIPAA law, telemedicine, and health insurer subrogation claims – to name just a few emerging issues – may impact our clients, and we counsel them to greet these changes with the confidence that comes from foresight and comprehensive legal preparation.

Our Health Care Industry Experience

Many of our seasoned litigators draw on health care backgrounds, bringing to each matter an invaluable understanding of the internal and external pressures that our clients face – as well as a powerful authority in the courtroom. Our team includes former in-house counsel for health care businesses and systems, long-term care company board members, hospital and emergency room advisory committee members, and a former paramedic.

Our attorneys are also committed to the constant refinement of their trial technique and expanding their knowledge of current medical science through service on the Steering Committee of the Defense Research Institute’s Health & Medical Liability Committee, which has over 2,000 members nationally. They have spoken at its national annual conference to hundreds of trial attorneys and health industry professionals on the subject of advanced trial technique in the defense of medical malpractice cases.

In addition, our attorneys are active members and leaders in legal and industry organizations including:

• Vice Chair of the Federation of Defense and Corporate Counsel (FDCC) Health Care Section
• Vice Chair of the Defense Research Institute (DRI) 2018 Nursing Home and Assisted Living Seminar
• American Health Lawyers Association (AHLA) – Chapter Editor of Post Acute Care Handbook
• Professional Liability Underwriting Society (PLUS)

Our Expert Witness Edge

Decades of experience have helped us develop an extremely valuable database of expert witnesses to call upon, as well as a parallel database of the experts commonly retained by plaintiffs’ attorneys. These databases are essential in preparing defense strategies and developing effective cross-examination of opposing expert witnesses based upon close analysis of testimony they have given in other cases.

Our clients trust us to choose, prepare, and utilize the best expert witnesses for each matter, and then to translate the sophisticated concepts in their testimony into compelling narratives for the judge and jury. Recent cases reflect the complexity of the legal and medical issues involved in the claims our clients face – as well as the role that our effective preparation and cross-examination of expert witnesses has played. For example:

• We retained a leading neurologist who had previously served as the State of Florida’s independent medical expert in the widely publicized Terri Schiavo ‘right to die’ life support case. The central issue in our case, in which we represented a major medical center, turned upon this expert’s testimony and represented a potential multimillion-dollar swing in the jury verdict, depending upon whether the patient could receive an award for conscious pain and suffering. The use of this expert was critical in demonstrating the absence of cognition.

Our Impact

Because our attorneys are deeply embedded in the health care industry – through previous in-house and professional experience, leadership in industry organizations, and long-term relationships with clients – we are uncommonly conscious of developments in case law and the impact that each of our results could have not only on our clients, but on the entire health care community. That impact has been overwhelmingly positive. In several instances, the cases we have successfully resolved have made new law upon which future cases will be decided.

• We tried the case of Kambat v. St. Francis Hospital, the leading case citation in New York’s Pattern Jury Instructions on the subject of res ipsa loquitor, a legal concept applied when an unintended medical outcome can ostensibly have no explanation other than professional error. Although the first jury unanimously found in favor of our client, on appeal to New York’s highest court the case was remanded for a second trial to be conducted with the res ipsa loquitor jury instruction, which essentially tells a jury to find for the plaintiff if the medical outcome could only be explained by medical error. On retrial, a second jury also unanimously found for our client. The case was considered significant enough to receive front-page treatment in the New York Law Journal, New York’s leading law publication, and to be addressed in tort law textbooks used in law school curricula.
• In another case which received national media attention, we defended a hospital at which a nurse had euthanized extremely ill elderly patients and was convicted and imprisoned. The hospital’s liability for these actions turned upon its supervision and knowledge of the activities of the nurse, and we directed the in-house investigation which was essential to establishing defenses to the multiple wrongful death claims.
• We won dismissal of a $25 million medical malpractice suit alleging failure to diagnose against a health clinic associated with the U.S. Department of Veterans Affairs and a physician working there. Law360 covered this complicated, 17-day bench trial, which involved conflicting testimony and detailed analysis of symptoms and standards of care for a rare spinal nervous condition, cauda equina syndrome. The U.S. District Court for the Western District of New York’s ruling that the clinic and the supervising physician were not liable for damages the plaintiff sustained due to allegedly late diagnosis not only reaffirmed the standard of care our clients maintain, but also created case law favorable to health care providers.
• We established new law while defending a nonprofit health and human services agency for individuals with special needs, accused of causing serious injury and death of the plaintiff. The plaintiffs attempted to establish that the group home was a “residential healthcare facility” and therefore subject to the Public Health Law, which would make it easier for the plaintiffs to access punitive damages. The New York State Appellate Division Fourth Department agreed that the group home was not a “residential healthcare facility” and dismissed all claims under the Public Health Law – a landmark victory for the thousands of agencies that operate under the Office for People with Developmental Disabilities (OPWDD) regulations.

We also volunteer to teach medical students at medicolegal seminars to advance their knowledge of their legal obligations, for the benefit of both their patients and their practices. In short, we are active in every important aspect of the advancement of current medicolegal thinking, and our attorneys bring that to bear for the benefit of every client we have the privilege to represent.

Goldberg Segalla errors and omissions (E&O) lawyers routinely represent insurance agents and brokers in E&O claims and lawsuits on a regional and national basis. We have successfully litigated hundreds of such lawsuits, derived from claims arising out of both first-party and third-party claims, in connection with placements in the excess and surplus lines market, as well as personal lines, commercial lines, professional liability, umbrella excess, life, health, and disability (LHD), and workers’ compensation coverage.

Our errors and omissions attorneys don’t just defend E&O claims – we actively assist our clients in trying to prevent them. We are committed to providing insurance agents and brokers and their E&O insurers with cutting-edge, practical E&O loss control advice and to help them implement those techniques. We are also available to represent insurance agents and brokers outside of an insured claim, including with respect to E&O loss control and prevention seminars and audits, and to assist the insurance agents and brokers in obtaining insurance coverage for claims on behalf of the customers against the insurance agency or brokerage.

When intellectual property assets require protection from infringement, defense against claims of infringement, or proactive measures to mitigate risk, Goldberg Segalla brings extensive experience managing, litigating, and trying complex trademark, copyright, trade secret, and commercial cases. Because we have the experience, knowledge, and ability to understand and communicate highly technical concepts effectively to courts, jurors, administrators, opposing counsel, and other parties, we are able to design effective strategies that fit the situation and often negotiate creative and more efficient solutions to disputes. When that is not possible, this strengthens our ability to enforce our clients’ rights in litigation and other proceedings.

Our lawyers defend other lawyers against errors and omissions claims, allegations of legal malpractice, in disciplinary proceedings where licenses are in jeopardy, and against all kinds of other claims which are often asserted by people who weren’t even the lawyers’ clients. Routinely hired by legal malpractice insurers to defend their insured lawyers, as well as hired directly by other members of the bar, we have defended attorneys who practice in all areas of the law, including personal injury, commercial litigation, mergers and acquisitions, banking and finance, debt collection, estate planning, intellectual property, bankruptcy, real estate, criminal law, and matrimonial law, to name just a few. Our team draws on decades of collective experience spanning hundreds of cases, some involving financial exposure in the tens of millions of dollars.

Long-term care facilities are burdened with elevated regulatory scrutiny at both the state and federal levels, which has stoked the predatory aggression of the plaintiffs’ bar and triggered an increase in civil claims. Led by a former in-house counsel at one of the nation’s largest privately owned long-term care companies, attorneys in our dedicated Long-Term Care team understand the special concerns involved in these complex, sensitive, and high-value cases, and we bring a wealth of experience and knowledge to the defense of our clients in the industry.

We protect the interests and reputations of nursing homes, assisted living, independent living, post-acute, mental health care, continuing care retirement, skilled nursing, long-term care pharmacy, and rehabilitation facilities and companies targeted with negligence, abuse, and malpractice claims.

From dog groomers to dieticians, Goldberg Segalla errors and omissions attorneys have defended scores of insureds in the burgeoning field of miscellaneous professional liability (MPL). Combining our extensive experience defending the traditional professions with proven practices for handling MPL claims – including quickly identifying the relevant standard of care and leveraging our deep contractual dispute capabilities – the Goldberg Segalla team has worked and won cases on the furthest edge of the MPL frontier since the policy line’s beginnings.

We also understand how the law fits – and, in many important ways, does not yet fit – this expansive and expanding category. The novel and continually evolving line of insurance and class of insureds is poised to equal, if not soon exceed, the traditional professional lines.  And as it grows, we’re proud of our continued work both in defending individual professionals and in helping insurers to understand, anticipate, and adapt to emerging exposures and trends in claims and litigation.

We have represented insured clients across a vast range of fields and industries, and our team is prepared to defend MPL claims for virtually any type of professional, including:

• Adjusters
• Answering service workers
• Auctioneers
• Advertising, promotions, and marketing professionals
• Bill collectors
• Credit counselors
• Event planners
• Executive recruiters
• Exercise instructors
• Financial advisors
• Graphic designers
• Human resource consultants
• Interior decorators
• Interpreters/translators
• Life coaches
• Market researchers
• Management consultants
• Mediators/arbitrators
• Medical record and health information technicians
• Nurses
• Nutritionists
• Pet groomers
• Property managers
• Tattoo artists and piercing technicians
• Tax preparers
• Third-party administrators
• Ticket brokers
• Translators
• Travel agents
• And many others

MPL Defense: Early Evaluation, Early Resolution

Striving to see ahead of emerging trends in MPL, we have developed an approach to defense that is founded on proven practices but flexible enough to be tailored to each case and client, and to evolve along with trends in policies, claims, statues, and judicial decision-making.

More than traditional professional liability claims, MPL claims typically combine standard of care (negligence) theory with contract claims and defenses. Also, unlike traditional claims, these often involve liquidated or otherwise easily reckoned damages. With veteran litigators and trial attorneys exceptionally experienced in representing, counseling, and defending in the field of traditional professional liability, our team is particularly adept at identifying the standard of care applicable to this new and ever-expanding class of service providers. This allows for very early assessment and evaluation, frequently leading to early resolution.

Shaping the Future of MPL Policies and Practices

Collaborating freely and frequently across the firm’s entire national footprint, we represent an immense experience bank that covers virtually the whole of the existing MPL class and all types of MPL claims seen to date. This is an invaluable resource when it comes to defending insured clients in MPL litigation anywhere in the U.S. – but our clients rely on us and our experience for much more than litigation.

Numerous national and regional insurance carriers have brought our errors and omissions lawyers in to lecture their underwriting and claims staff on MPL exposures, especially emerging exposures, and trends in claims and litigation. We also regularly publish on both claims-handling and MPL coverage – though our clients are always the first to benefit from our analysis and assessments of the latest trends.

Through our defense of insured and counsel for MPL insurers – as well as through our leadership in organizations like the Professional Liability Underwriting Society (PLUS), the Professional Liability Defense Federation (PLDF), the Claims and Litigation Management Alliance (CLM), and professional liability committees of the American Bar Association (ABA) and DRI – we will continue to work at the forefront of MPL to improve defense, claims-handling, policy-writing, and where possible the law, for the benefit of working “miscellaneous” professionals and their insurers across the nation.

Many national insurance company partners have entrusted Goldberg Segalla to provide risk- management hotlines for their management and professional liability policyholders. This value-added benefit provides policyholders with 24/7 direct access to counsel, and the opportunity to receive best-practice insights for rapidly emerging issues, unique challenges, and concerns regarding various errors and omissions situations for a wide variety of professionals, including:

• Accountants
• Real Estate Professionals
• Title Insurance Agencies and Brokers
• Staffing Agencies and Professional Employer Organizations
• Home Inspectors
• Franchisors and Franchisees
• Property Managers
• Notaries

While no attorney-client privilege is formed in the context of a hotline call, the insights provided can help a firm manager gain tactical insights and strategies on how to handle a given situation to contain damage and keep problems from escalating. Providing policyholders a direct hotline to knowledgeable counsel provides an invaluable resource for reducing risk and exposure as a supplement to their company’s risk-control programs.