Justia Legal Ethics Opinion Summaries

When Plaintiff retained a Maine law firm to represent him in a legal action, he signed an attorney-client engagement letter that contained an arbitration provision. Plaintiff later sued the law firm and individual defendants (collectively, Defendants) for malpractice and violations of Maine's Unfair Trade Practices Act. Defendants moved to compel arbitration and dismiss the action. The district court granted the motion under the Federal Arbitration Act (FAA). Plaintiff appealed, arguing that the district court erred in enforcing the arbitration clause. The First Circuit Court of Appeals affirmed, holding that the district court did not err in granting the motion to compel arbitration and dismissed the action, as (1) Maine professional responsibility law for attorneys permits arbitration of legal malpractice claims so long as there is no prospective limitation on the law firm's liability; and (2) Maine law, like the FAA, is not hostile to the use of the arbitration forum, and Maine would enforce the arbitration of malpractice claims provision in this case. View "Bezio v. Draeger" on Justia Law

Crockett’s former law firm subscribed to a LexisNexis legal research plan that allowed unlimited access to certain databases for a flat fee. Subscribers could access other databases for an additional fee. According to Crockett, LexisNexis indicated that a warning sign would display before a subscriber used a database outside the plan. Years after subscribing, Crockett complained that his firm was being charged additional fees without any warning that it was using a database outside the Plan. LexisNexis insisted on payment of the additional fees. The firm dissolved. Crockett’s new firm entered into a LexisNexis subscription agreement, materially identical to the earlier plan; it contains an arbitration clause. Crockett filed an arbitration demand against LexisNexis on behalf of two putative classes. One class comprised law firms that were charged additional fees. The other comprised clients onto whom such fees were passed. The demand sought damages of more than $500 million. LexisNexis sought a federal court declaration that the agreement did not authorize class arbitration. The district court granted LexisNexis summary judgment. The Sixth Circuit affirmed. “The idea that the arbitration agreement … reflects the intent of anyone but LexisNexis is the purest legal fiction,” but the one-sided adhesive nature of the clause and the absence of a class-action right do not render it unenforceable. The court observed that Westlaw’s contract lacks any arbitration clause.View "Reed Elsevier, Inc. v. Crockett" on Justia Law

This appeal concerned the parties' dispute over an arbitration award to plaintiff. Plaintiff appealed the district court's ruling on interest and attorney's fees, and Lloyd's cross-appealed requesting return of an alleged overpayment to plaintiff from a fund which held that the award in escrow pending the outcome of litigation. The court concluded that the decision of the arbitrators did not foreclose the district court from awarding interests on the remaining portions of the arbitration award; plaintiff was entitled to post-award, pre-judgment interest pursuant to Nev. Rev. Stat. 17.130; to the extent the mandate must include instructions on pre-judgment interest to comply with Rule 37(b) of the Federal Rules of Appellate Procedure, the court reformed the mandate as such; plaintiff was entitled to collect post-judgment interest on his post-award, pre-judgment interest from the date of this opinion until the date Lloyd's pays the interest; plaintiff was entitled to attorney's fees pursuant to Nev. Rev. Stat. 689A.410(5); and the district court did not impermissibly overpay plaintiff when it released the funds from the escrow account and included interest on the contract damages through the date of payment. Accordingly, the court reversed and remanded in part and affirmed in part. View "Lagstein v. Certain Underwriters" on Justia Law

Norma Slater-Moore hired the Goeldner Law Firm and its attorneys to represent her in what ultimately was an unsuccessful lawsuit and its appeal. Slater-Moore and Goeldner entered into two separate contracts during the course of that litigation, both containing nearly identical provisions stating that any attorney-fee disputes would be submitted to arbitration. Slater-Moore later sued Goeldner for legal malpractice and breach of contract, disputing, among other allegations, the amount she was billed for attorney fees. Goeldner successfully moved the Circuit Court to compel arbitration of the attorney-fee dispute, and Slater-Moore appealed that decision to the Supreme Court. Because the Supreme Court found ]no grounds for revocation of a valid agreement to arbitrate the fee dispute, the Court affirmed the circuit court's judgment. View "Slater-Moore v. Goeldner" on Justia Law

Freeman worked at PPG until his firing in 2008; PGW subsequently assumed PPG’s liabilities. PPG maintains a 40 percent interest in PGW. After losing his job, Freeman, age 60, sued PGW under the Age Discrimination in Employment Act, 29 U.S.C. 621. The parties entered a binding arbitration agreement, listing three potential arbitrators. Lally-Green, a law school teacher, formerly a state judge, appeared at the top of both lists. Lally-Green acknowledged that she “knew some people at PPG” and had taught a seminar with a PPG attorney. The parties proceeded with Lally-Green as their arbitrator. The proceeding was fair and thorough. Lally-Green concluded that Freeman lost his job because he “had limited recent sales experience ... [and] received average performance ratings in a poorly performing region.” Three months later, Freeman moved to vacate the decision, claiming that Lally-Green had failed to disclose campaign contributions that she had received from PPG and its employees during her campaign for a seat on the state’s highest court. These contributions totaled $4,500. Lally-Green had raised $1.7 million during her unsuccessful campaign. The district court denied the motion. The Third Circuit affirmed, noting that the law firm representing Freeman had contributed $26,000 to Lally-Green’s campaign. View "Freeman v. Pittsburgh Glass Works, LLC" on Justia Law

The issue before the Supreme Court in this case centered on a binding arbitration clause in an attorney-client retainer agreement and whether that clause was enforceable where the client filed suit for legal malpractice. This case presented two important countervailing public policies: Louisiana and federal law explicitly favor the enforcement of arbitration clauses in written contracts; by the same token, Louisiana law also imposes a fiduciary duty "of the highest order" requiring attorneys to act with "the utmost fidelity and forthrightness" in their dealings with clients, and any contractual clause which may limit the client's rights against the attorney is subject to close scrutiny. After its careful study, the Supreme Court held there is no per se rule against arbitration clauses in attorney-client retainer agreements, provided the clause is fair and reasonable to the client. However, the attorneys' fiduciary obligation to the client encompasses ethical duties of loyalty and candor, which in turn require attorneys to fully disclose the scope and the terms of the arbitration clause. An attorney must clearly explain the precise types of disputes the arbitration clause is meant to cover and must set forth, in plain language, those legal rights the parties will give up by agreeing to arbitration. In this case, the Defendants did not make the necessary disclosures, thus, the arbitration clause was unenforceable. Accordingly, the judgment of the lower courts was affirmed. View "Hodges v. Reasonover" on Justia Law

Arnold & Itkin, a Texas-based law firm, appealed from a judgment of the district court sanctioning it for its conduct in opposing the arbitration of a dispute between its clients. Arnold & Itkin challenged the determination that the conduct was sanctioned and the amount and form of the sanctions imposed. The court largely affirmed the judgment of the district court, except that the court remanded in part to permit the district court to consider whether it should impose certain limits on its requirements that Arnold & Itkin's attorneys attached the sanction order to all future applications for admission pro hac vice in the Southern District of New York. View "Prospect Capital Corp. v. Enmon" on Justia Law

The Town of Little Compton filed a complaint against the town firefighters union, contending that the union, or its representative, had engaged in the unauthorized practice of law when the union allowed its nonlawyer business agent to represent it at a labor arbitration hearing. The Unauthorized Practice of Law Committee concluded that the union representative's action constituted a technical violation of the statute governing the unauthorized practice of law. Mindful that this type of lay representation of unions in labor arbitrations is a common practice, the Committee petitioned the Supreme Court on how to proceed. The Supreme Court held that, although the conduct involved in this case may have been the practice of law pursuant to the statute, because of the long-standing involvement of nonlawyer union employees at public grievance arbitrations, the Court would not limit this involvement at this time. View "In re Town of Little Compton" on Justia Law

Plaintiff, the former in-house counsel for Toyota Motor Corp. (TMS), presented TMS with a claim asserting, inter alia, constructive wrongful discharge related to TMS's alleged unethical discovery practices. TMS and plaintiff settled the claims and entered into a Severance Agreement. TMS subsequently sued in state superior court seeking a temporary restraining order (TRO) and permanent injunctive relieve to prevent plaintiff from violating the attorney-client privilege and plaintiff filed a cross complaint for a TRO and a permanent injunction prohibiting TMS from interfering with his business practices and those of his consulting business. The court held that the Federal Arbitration Act (FAA), 9 U.S.C. 1 et seq., governed the Severance Agreement; the FAA authorized limited review of the Final Award; and the arbitrator did not manifestly disregard the law governing the Severance Agreement where the arbitrator's writing was sufficient under the terms of the Severance Agreement and the arbitrator did not manifestly disregard California law in addressing plaintiff's affirmative defenses. The court also held that the district court did not err in denying plaintiff's contempt motion. Accordingly, the judgment was affirmed. View "Biller v. Toyota Motor Corp., et al." on Justia Law

This case stemmed from appellee's legal representation of appellant in a criminal tax fraud case. Appellee subsequently filed a lawsuit against appellant for recovery of unpaid attorneys' fees and appellant counterclaimed for malpractice and later petitioned for arbitration before the District of Columbia Attorney/Client Arbitration Board (ACAB), an arm of the District of Columbia Bar. Appellant also moved the district court for a stay pursuant to the Federal Arbitration Act (FAA), 9 U.S.C. 3, the denial of which he appealed. At issue was whether appellant was "in default" of his right to arbitrate. The court affirmed the district court's denial of the stay where appellant failed to make a timely assertion of his right to arbitrate and his litigation activity, after he filed his initial answer and counterclaim, imposed substantial costs upon appellee and the district court.