FKB's Joshua Sandberg wins motion for summary judgment dismissing legal malpractice claim in New York County concerning underlying employment (EPL) litigation. 3/31/2011

Hon. Joan A. Madden of New York County Supreme Court granted FKB's motion for summary judgment seeking dismissal of a legal malpractice action against our clients in connection with their representation of the plaintiff in a lawsuit against her former employer.

Plaintiff, a real estate broker, was an independent contractor employed by a well-known real estate firm from 1996 through her termination in March 2002. She was fired for her alleged use of profanity and was then locked out of her computer, where she kept her customer list. Plaintiff then retained FKB's clients to file suit against her employer and others. After a one-month trial, the jury returned a verdict in favor of plaintiff for $400,000 in compensatory damages and $1.2 million in punitive damages with interest. FKB's clients were discharged after the trial. Plaintiff's employer appealed the verdict.

As plaintiff refused to pay FKB's clients for their legal services, they filed an application against plaintiff for a charging lien upon the proceeds of a settlement or judgment. By order of Justice Michael Stallman dated November 5, 2007, the issue of whether FKB's clients were entitled to a charging lien, the amount of the charging lien, and other issues were referred to a Special Referee to hear and determine. The hearing commenced on June 9, 2008, continued on June 11, 2008, and concluded on June 12, 2008. On September 4, 2008, the Special Referee found that FKB's clients had a charging lien against any settlement or judgment of plaintiff's claims, and further found that FKB's clients were not discharged for cause in connection with the legal services they rendered to plaintiff.

On or about January 10, 2008 (prior to the commencement of the hearing on the charging lien), plaintiff commenced a legal malpractice action against FKB's clients alleging, inter alia, that FKB's clients were negligent in failing to pursue certain causes of action, including a claim for the intentional infliction of emotional distress, and that the legal representation was compromised by a conflict of interest.

FKB moved for summary judgment to dismiss plaintiff's claims on the grounds that such claims were barred by the doctrines of collateral estoppels and res judicata based on the well settled case law holding that a determination fixing the value of an attorney's services necessarily determines that there was no malpractice. Accordingly, FKB argued that the Special Referee's decision holding that there was a charging lien against any settlement or judgment of plaintiff's claims against her former employer barred her legal malpractice claims.

After oral argument, Justice Madden fully agreed with FKB's arguments, holding that FKB's clients were entitled to summary judgment dismissing the complaint as the Special Referee's decision that FKB's clients were entitled to a charging lien bars any action for legal malpractice.

FKB's clients were represented by Joshua Sandberg.

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