Thursday, October 22, 2015

The Gravamen of Litigation Malpractice

Sprengel v. Zbylut, No. B256761 (D2d7 Oct. 13, 2015)

The anti-SLAPP statute can be tricky when it comes to cases involving litigation malpractice. To the extent that the claims touch on stuff an attorney does in court they at least superficially can seem to satisfy the first, “arising from” element of the two-pronged test. But on a less literal level, that doesn’t make any sense. A malpractice claim that a client brings against his own attorney has essentially nothing to with chilling anyone’s First Amendment rights, even if the attorney’s in-court or litigation related statements are somehow implicated in the malpractice.

To get around this, a number of prior court of appeal cases involving litigation malpractice treat the litigation activity as tangential or collateral to the true gist of the claim, which is that an attorney violated professional obligations to his client, such as duties of loyalty or competence. While those breaches might be manifested through litigation activity, the gravamen of the claim—“the allegedly wrongful and injury-producing conduct that provides the foundation for the claims”—is nonetheless breaches of the professional duties attorney owes to client.

Generally speaking, that makes sense. And that’s how the Court views this case, which involves the dissolution of a 50/50 LLC. Law firm represents the LLC and its managing member in connection with the dissolution, in opposition to the other member. The other member sued here, claiming that Law firm also owed him a duty of loyalty, which it breached in advocating against his interests. Settling aside whether that’s a legit claim—a recent case strongly suggests no—in addressing the LLC’s anti-SLAPP motion, the court holds that the “arising from” test isn’t met because the case arises from the alleged disloyalty, and not from the resulting advocacy adverse to the minority member.

Justice Perluss dissents. He doesn’t disagree with the court’s application of existing precedent, so much as he’s not on board with the earlier precedent. Under his take, those cases put policy and purpose over the plan reading of § 425.16(b). He doesn’t disagree that applying the anti-SLAPP statute to malpractice claims doesn’t serve the purpose of the statute. But given the Supreme Court’s various entreaties over the years to read the statute literally and broadly, he thinks it’s too much of an artifice to say that these claims don’t actually arise from litigation or litigation related conduct. So given that the gist of the action here is that the Law Firm acted disloyally by litigating against the plaintiff, the test should be met. According to Justice Perluss, if there’s a fix to be had, the ball is in the Legislature’s court.


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