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In a per curiam decision, the Second Circuit recently joined other circuits in holding that “claims of professional malpractice based on services rendered pursuant to a bankruptcy petition are subject to the bankruptcy court’s original but not exclusive jurisdiction under Section 1334(b) of title 28.”[1] In 2001, Aston Baker (
In July 2010, the U.S. Bankruptcy Court for the District of New Mexico declined to dismiss a cause of action by a chapter 7 trustee against a lawyer who had submitted an offer from a third party to purchase estate property, leaving for trial whether the lawyer may be held personally liable on the contract. The opinion in Gonzales v.
American Bar Association (ABA) Model Rule 7.3 prohibits a lawyer from soliciting professional employment in person, by live telephone or real-time electronic contact where pecuniary gain is a significant motive and the prospective client is not a lawyer and does not have a family, close personal or prior professional relationship with the lawyer.
In today’s economic climate, it is not uncommon for law firms to encounter trouble collecting outstanding legal fees. Although not preferred, law firms may ultimately have no choice but to commence collection actions against former clients. It is uncommon, however, for law firms to commence involuntary bankruptcies against former clients to recover unpaid fees.
It is hard to open a law periodical these days without hearing about the shift from hourly billing to alternative fee arrangements such as flat fees. It may be premature to mourn the demise of the billable hour, but it is nevertheless imperative for lawyers to become familiar with the ethical pitfalls inherent in alternative billing arrangements.
For some time, there has been confusion over when a civil injunction is dischargeable in bankruptcy. In United States v.
Due to the recent recession, there has been a substantial increase in bankruptcy filings.
Almost two years ago, the financial markets collapsed and big banks came running to the government for a bailout. Public opinion held that an era of irresponsible lending and unquestioned growth in the U.S. housing market precipitated the economic downfall of late 2008, just as Barack Obama was campaigning to become our next president.
