Legal Malpractice

How Do You Forget to File a $19 Million Legal Malpractice Case?

By (Andrew Lavoott Bluestone)

Chicago Business Litigation Lawyer Blog reports that a huge class action legal malpractice case against DLA Piper Rudnick has been dismissed.  Plaintiff's and defendants had entered into a tolling agreement that was amended and went on for several years.  This case was valued at over $ 19 million dollars.  After several amendments of the tolling agreement plaintiffs started the case, but the court determined that it was started a year too late!  Joyce v. DLA Piper Rudnick ended in dismissal.

From the Blog: "The underlying dispute started in 1999, when 21st Century agreed to merge with competitor RCN. DLA Piper attorneys drafted a merger agreement with a mistake that lowered the price of the stock 21st Century shareholders were to receive by $19 million. In response, Edward Joyce, the stockholders’ representative, made a tolling agreement with DLA Piper, in which the statute of limitations was tolled unless a stockholder lawsuit was filed against the firm on or before December 31, 2002. The firm agreed not to avail itself of any statute of limitations defense until after that day. This agreement was amended four times, each time altering only the date. The last agreement set that date at August 21, 2005.

Joyce filed a legal malpractice class action in Cook County against DLA Piper on August 30, 2006. After some procedural disputes, including a finding by the trial court that the filing was timely, the firm won a motion to dismiss based on plaintiff’s lack of standing as a non-client. The plaintiffs appealed and the defendant cross-appealed on the trial court’s decision that the suit was timely.

The appeals court upheld that cross-appeal, finding that the plaintiffs were barred because they filed nearly a year after the last agreement expired. The court rejected the defendants’ contention that it was timely because each amended tolling agreement constituted a new contract that extended the statute of limitations. "

Full post as published by New York Attorney Malpractice Blog on June 19, 2008 (boomark / email).