Lawyers Insurance

Law Firm Allowed to Bring Third-Party Lawsuit Against Three Firms

A New York appeals court granted the law firm of Reed Smith the ability to reinstate its claims against three law firms in connection with a legal malpractice lawsuit.  Reed Smith was previously sued by Millennium Import for failure to give proper advice in negotiations to license and subsequently protect the name “Belvedere” as a liquor.  Reed Smith alleges that these three other New York firms played a part in the negotiations and rendered professional advice that contributed to the loss Millennium Import experienced.

Even if a law firm plays a small role in a larger engagement, their roll may exposes them to the full liability of that engagement.  This is important to recognize when the firm is contemplating adequate insurance limits and risk management practices.  Although a firm may practice in primarily low-risk areas, insurance is meant to protect against catastrophic losses.  A firm must be able to recognize what their highest risk engagement is and contributory engagements should be considered. Contact a licensed broker to discuss whether your firm is carrying adequate limits and has the right coverage to protect your firm.

 

 

 

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