Photo by Jonathan Rotondo-McCord
The docketing in U.S. District Court for the District of Minnesota of a multi-million dollar “foreign” judgment (from a federal court in New York) against a law firm got my attention this week.
The judgment came after a trial for professional malpractice against Antonelli Terry Stout & Kraus (“ATS&K”), a law firm (formerly?) located in the state of Virginia, and some of its lawyers who made a tiny mistake in a patent application. They forgot to check a check-box so that the application would apply in the United States (click here for the details of the case and/or here). Former client and plaintiff Protostorm LLC argued that the lapse resulted in a loss of millions of dollars that they would otherwise have obtained with a valid patent.
One theme common to more than a few malpractice cases is that the client was behind on paying its bills and the law firm was not particularly eager to work on the client’s matter. Things fall through the cracks when lawyers are half-way out the door (or all the way out the door) and the client is not 100% clearly on notice that the lawyers have stopped representing the client. That is what apparently happened here.
The saddest part of this tale is that ATS&K and its lawyers were stripped of their professional liability insurance coverage (by our good friends at Minnesota Lawyers Mutual) because one of the lawyers was financially tied to the client, which tripped the “Business Enterprise Exclusion” provision in the policy. (Here is the summary judgment order in favor of MLM.) I wonder whether Protostorm’s lawyers are docketing this judgment in all 50 states or whether they have their eyes on a particular asset in Minnesota (a lake house? a financial institution account?).