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Proving “the Case Within the Case” in a Legal Malpractice Action

Author By Todd McMurtryPosted on

A person or company alleging legal malpractice bears a unique burden often referred to as proving “the case within the case.” Essentially, the plaintiff must show two layers of causation: first, that the defendant attorney’s conduct fell below the standard of care, and second, that if the attorney had handled the underlying case competently, the outcome would have been more favorable. The malpractice trial must simulate or recreate the original case so that the factfinder — usually a jury — can determine the probable result if the attorney had acted appropriately.

To meet the burden of proof in a legal malpractice case, the plaintiff must present evidence that not only establishes what the attorney did wrong but also enables a jury to assess what the result would likely have been if the lawyer had handled it correctly. In a negligence case, this would involve presenting testimony and other evidence that would have been on record in the underlying trial. If it was a criminal case in which the plaintiff was convicted and/or received a heavy sentence, it would have to be shown that the outcome would have likely been an acquittal or a lesser sentence if the attorney had been more diligent.

In structuring the case within the case, a judge must apply the same procedural and evidentiary rules and jury instructions as in the original trial. The judge must make sure that the jury’s focus is on the evidence rather than on conjecture. This sometimes involves the judge giving specific instructions to clarify that the jury is not reconsidering the underlying case itself but instead determining what the outcome should have been.

The case within the case becomes more complex when the underlying case ended in a settlement rather than a trial. The plaintiff still must prove that a more favorable outcome could have been achieved. However, settlements involve numerous factors, including the strengths and weaknesses of the case, the risks of litigation and the plaintiff’s own preference for certainty over potential future gains. In these instances, the jury does not evaluate what a judge or jury would have decided in the original case but instead assesses whether the plaintiff could have obtained a better settlement if the attorney had handled the matter more competently.

If the matter was settled, the court may rely more on expert testimony to help the jury understand how settlements are evaluated, particularly if they involve specialized fields like corporate law, intellectual property or personal injury. Experts can provide insight into typical settlement values and how specific errors by the attorney — such as failing to pursue certain claims or neglecting evidence that would have strengthened the plaintiff’s position — may have impacted the settlement. Additionally, the judge may instruct the jury to consider how the attorney’s actions influenced the plaintiff’s decision to settle, such as if the attorney failed to fully advise the client of the risks or potential outcomes of going to trial.

A person bringing such a lawsuit should entrust the matter to a professional malpractice attorney who understands the underlying case and can vividly show how the defendant’s conduct fell short of the applicable standards of care.

About Finney Law Firm, LLC

Founded in 2014, FLF has grown to 15 attorneys located in offices in Eastgate and downtown Cincinnati with five major practice areas: Corporate Law, Real Estate Law, Employment Law, Commercial Litigation and Public Interest and Constitutional Litigation.  FLF has the unique claim to three 9-0 victories at the United States Supreme Court for its public interest practice along with breakthrough class action work.

FLF also has an affiliated title insurance company, Ivy Pointe Title, LLC, that closes and insures nearly a thousand commercial and residential real estate transactions annually.

For more information about Finney Law Firm, visit finneylawfirm.com.

Media Contact: Mickey McClanahan; mickey@finneylawfirm.isoc.net; 513.797.2850.

What Is Minority Shareholder Oppression That Can Lead to Litigation?

Author By Todd McMurtryPosted on

Many businesses have only a few owners or shareholders. This is particularly common among closely held businesses. It is the owners who decide major issues such as selling or purchasing assets, merging with another company or declaring dividends. However, not all owners are equal. Individuals who own the majority of the shares have the greater say on these decisions. Minority shareholders have limited power, but they are nonetheless entitled to certain rights. When these rights are infringed, it may constitute shareholder oppression that creates a legal right of action.

Shareholder oppression, in order to be actionable, must comprise conduct that is fraudulent, unfair or illegitimate. Being outvoted on a given issue does not constitute oppression. The majority’s action must be inherently unfair and harmful to the minority’s interests. Examples of shareholder oppression include:

  • Income diversion — The majority owners might divert the company’s net profits to themselves to the prejudice of the minority owners. This can be done in a number of ways, some of which are either fraudulent or illegitimate.
  • Share dilution — The majority owners might pass bylaws that reduce the voting power of the minority. This creates an even bigger power imbalance and gives the majority even greater leverage over the minority shareholders.
  • Denial of access — Minority owners might be denied access to the company’s books and records or they might be restricted from attending official company meetings or entering upon company property.
  • Employment — In many small companies, shareholders are also employees. Sometimes the majority will vote to terminate a minority owner’s employment and remove their access to company property and records.
  • Withholding dividends — Owners typically derive a percentage of the company’s net profits based on their shareholdings. Sometimes majority owners vote to keep the dividend within the company rather than distribute profits. Doing so can cause minority shareholders financial hardship. For some owners, company dividends are a large percentage of their income.

Minority shareholders do have remedies. A Kentucky statute allows a shareholder may seek a court order dissolving the company upon showing that the directors or those in control have acted, are acting or will act in a manner that is illegal or fraudulent. In addition, a minority owner can bring a lawsuit asking the court to use its equitable powers to craft a remedy. The court may enjoin or stop the majority from taking further oppressive actions and reverse those that have already been implemented. The court could also order majority members to buy out the minority at a given price. An experienced business litigation attorney can analyze your situation and advise on appropriate action.

About Finney Law Firm, LLC

Founded in 2014, FLF has grown to 15 attorneys located in offices in Eastgate and downtown Cincinnati with five major practice areas: Corporate Law, Real Estate Law, Employment Law, Commercial Litigation and Public Interest and Constitutional Litigation.  FLF has the unique claim to three 9-0 victories at the United States Supreme Court for its public interest practice along with breakthrough class action work.

FLF also has an affiliated title insurance company, Ivy Pointe Title, LLC, that closes and insures nearly a thousand commercial and residential real estate transactions annually.

For more information about Finney Law Firm, visit finneylawfirm.com.

Media Contact: Mickey McClanahan; mickey@finneylawfirm.isoc.net; 513.797.2850.

 

When Does the Clock Start Running on a Legal Malpractice Claim?

Author By Todd McMurtryPosted on

Attorneys are only human and it is possible that your lawyer made a serious mistake or gave you poor advice that caused you to suffer a negative outcome in your case. If you are disappointed with the result of a matter you entrusted to an attorney, you may have a legal malpractice cause of action. An important question is how long you have to sue.

In Kentucky, the statute of limitations requires an injured party to sue within one year from the date of the occurrence of professional malpractice or from the date when the malpractice was discovered or reasonably should have been discovered. But this can be a difficult standard to apply, since legal errors are often not readily apparent to lay people.

Fortunately, a few Kentucky Supreme Court opinions have fleshed out the contours of this standard in a way that is intended to protect the rights of clients while avoiding unnecessary legal malpractice litigation.

First, the court has held that legal malpractice doesn’t occur until the lawyer’s negligence hurts the client in a way that is not speculative and can’t be reversed. Generally, this means that you can’t sue until you are out of normal remedies for correcting the error. For instance, in cases where the lawyer allegedly mishandled litigation, the court has said that the malpractice didn’t occur until the client’s right to appeal was exhausted.

Secondly, the court applies the “continuous representation” rule, which delays the start of the limitations period until after the relationship with the attorney ends. One rationale for this rule is that you can’t be expected to discover the legal malpractice as long as the attorney who committed malpractice is the one advising you. Often times, you are not in a position to know whether the attorney is doing a bad job or is merely faced with a bad case or an obstinate judge.

This rule also gives attorneys the opportunity to correct their mistakes. A legal malpractice lawsuit is a poor substitute for pursuing a still winnable case. This doesn’t mean you are required to stick with an attorney who you believe is not doing their job properly. You are entitled to seek better representation if you can. However, the rule is meant to give the client and the attorney the opportunity to solve the problem before the mistake becomes irreversible.

About Finney Law Firm, LLC

Founded in 2014, FLF has grown to 15 attorneys located in offices in Eastgate and downtown Cincinnati with five major practice areas: Corporate Law, Real Estate Law, Employment Law, Commercial Litigation and Public Interest and Constitutional Litigation.  FLF has the unique claim to three 9-0 victories at the United States Supreme Court for its public interest practice along with breakthrough class action work.

FLF also has an affiliated title insurance company, Ivy Pointe Title, LLC, that closes and insures nearly a thousand commercial and residential real estate transactions annually.

For more information about Finney Law Firm, visit finneylawfirm.com.

Media Contact: Mickey McClanahan; mickey@finneylawfirm.isoc.net; 513.797.2850.

 

What are Your Legal Remedies When Someone Defames You on Facebook?

Author By Todd McMurtryPosted on

Facebook, a social media platform that its founders said would unite the world, unfortunately provides a forum for spreading misinformation and smearing reputations. If you believe you have been defamed on Facebook, there are things you can do to fight back.

A statement about a person or entity is defamatory if it is false, is communicated to a third party and causes injury. Defamation can be in the form of slander (spoken words) or libel (written communication). Both are possible on Facebook.

It is generally not possible to hold Facebook itself liable for defamatory posts by users. The Communications Decency Act gives Facebook and other social media platforms immunity from liability for users’ statements online. However, there are some narrow exceptions. For example, Facebook could be sued if it promises to remove content and then fails to do so.

In most cases, you must focus on the Facebook user who posted the material. The first thing you should do is take screenshots of the offending material and copy the URL of the Facebook user’s profile page,, saving this as evidence in case you need it in the future. Then, use Facebook’s tools to report the defamatory material. Facebook will review the material to see if it violates their Community Guidelines. If Facebook deletes the content, then you should consider that a victory. If, however, Facebook decides the content does not violate its terms, then you may wish to pursue legal options.

Legal action may not be productive in the case of an isolated incident of defamation but can be effective if the libel or slander is ongoing. Making a claim of online defamation can be complex. It requires a litigation attorney with technical savvy to identify the defamer and to get the content removed. A lawyer can do two things to help you combat defamation on Facebook:

  • Send a demand letter to the posting Facebook user, explaining the problems with the content and requesting removal. This letter, also known as a takedown request, can warn the user that you intend to file a lawsuit if they refuse to do so.
  • File a lawsuit. To prevail, you must prove that the content was false and that you have suffered actual injury, which can be difficult. A lawsuit is a big commitment financially and you’ll want to discuss the likelihood of success with your lawyer before going ahead.

About Finney Law Firm, LLC

Founded in 2014, FLF has grown to 15 attorneys located in offices in Eastgate and downtown Cincinnati with five major practice areas: Corporate Law, Real Estate Law, Employment Law, Commercial Litigation and Public Interest and Constitutional Litigation.  FLF has the unique claim to three 9-0 victories at the United States Supreme Court for its public interest practice along with breakthrough class action work.

FLF also has an affiliated title insurance company, Ivy Pointe Title, LLC, that closes and insures nearly a thousand commercial and residential real estate transactions annually.

For more information about Finney Law Firm, visit finneylawfirm.com.

Media Contact: Mickey McClanahan; mickey@finneylawfirm.isoc.net; 513.797.2850.