John W. Grace, Respondent,v.Michael R. Law, et al., Appellants.BriefN.Y.September 17, 2014To be Argued by: KEVIN J. ENGLISH (Time Requested: 15 Minutes) APL-2013-00276 Court of Appeals of the State of New York JOHN W. GRACE, Plaintiff-Respondent, – against – MICHAEL R. LAW, PHILLIPS LYTLE, LLP, ROBERT L. BRENNA, JR., and BRENNA, BRENNA & BOYCE, PLLC, Defendants-Appellants. ____________ Appellate Division Docket No. CA 13-00036 Erie County Clerk’s Index No. I 2011-004732 BRIEF FOR DEFENDANTS-APPELLANTS MICHAEL R. LAW AND PHILLIPS LYTLE, LLP PHILLIPS LYTLE LLP Kevin J. English, Esq. Andrew P. Devine, Esq. Attorneys for Defendants-Appellants, Michael R. Law and Phillips Lytle, LLP One Canalside 125 Main Street Buffalo, New York 14203-2887 Tel.: (716) 847-8400 Fax: (716) 852-6100 November 21, 2013 - i - DISCLOSURE STATEMENT Pursuant to 22 N.Y.C.R.R. § 500.1(f), defendant-appellant Michael R. Law advises the Court that he is neither a corporation nor a business entity, and defendant-appellant Phillips Lytle LLP advises the Court that it is a limited liability partnership that has no parents, subsidiaries or affiliates. - ii - TABLE OF CONTENTS Page DISCLOSURE STATEMENT ................................................................................... i TABLE OF AUTHORITIES .................................................................................... iv QUESTIONS PRESENTED ...................................................................................... 1 JURISDICTIONAL STATEMENT .......................................................................... 2 PRELIMINARY STATEMENT ............................................................................... 3 STATEMENT OF FACTS ........................................................................................ 6 A. Background ........................................................................................... 6 B. Grace’s treatment at the VA .................................................................. 6 C. Grace commences the federal court action ........................................... 7 D. The district court dismissed all claims against Dr. Boghani and the U of R, and the medical malpractice claim against the VA ............ 8 E. The district court erred in finding that Dr. Boghani was not an employee of the VA .............................................................................. 9 F. The district court erred in finding that the relation-back doctrine did not apply ........................................................................................ 12 G. Grace voluntarily discontinues the underlying case and sues for legal malpractice .................................................................................. 14 H. The Fourth Department refuses to apply Rupert and instead adopts the “likely to succeed” standard .............................................. 15 ARGUMENT ........................................................................................................... 20 POINT I UNDER NEW YORK LAW, GRACE WAIVED HIS LEGAL MALPRACTICE CLAIM ..................................................... 22 POINT II THIS COURT SHOULD REJECT THE “LIKELY TO SUCCEED ON APPEAL” STANDARD ..................................... 27 - iii - A. The standards .............................................................................. 28 B. The policy concerns identified by the majority are easily addressed .................................................................................... 32 C. Applying the “likely to succeed on appeal” standard here leads to results that are contrary to public policy....................... 35 POINT III THE REQUIREMENT OF THE FULL RECORD FROM THE UNDERLYING CASE CONFLICTS WITH THIS COURT’S HOLDING IN ZUCKERMAN ............................................................. 37 POINT IV GRACE’S DISCONTINUANCE OF HIS APPEAL AND CLAIM—WHICH WERE NOT FRIVOLOUS, AND THE RECORD BEFORE THE COURT GAVE REASONABLE CAUSE TO BELIEVE THAT A VALID APPEAL AND CLAIM EXISTED—PRECLUDES HIM FROM SUING LAW AND PL ............................................................................................... 41 CONCLUSION ........................................................................................................ 42 ADDENDA A. Excerpts from Law and PL’s Reply Memorandum of Law to the Trial Court B. Excerpts from Personal Injury Valuation Handbook Sections on “Medical Malpractice” and “Occupational Negligence” C. Excerpts from Law and PL’s Appellant’s Brief to the Fourth Department - iv - TABLE OF AUTHORITIES Page CASES Austin v. Interfaith Med. Ctr., 264 A.D.2d 702 (2d Dep’t 1999) ........................................................................ 13 Bradley v. Davis, 777 So.2d 1189 (Fla. Dist. Ct. App. 2001) ......................................................... 40 Buran v. Coupal, 87 N.Y.2d 173 (1995) ......................................................................................... 13 Crestwood Cove Apts. Bus. Trust v. Turner, 164 P.3d 1247 (Utah 2007) ................................................................................. 27 Eastman v. Flor-Ohio, Ltd., 744 So.2d 499 (Fla. Dist. Ct. App. 1999) ........................................................... 30 Evanston Ins. Co. v. Kimmel, 2011–0526, 2011 WL 6288045 (La. Ct. App. Dec. 14, 2011) ........................... 31 Hewitt v. Allen, 43 P.3d 345 (Nev. 2002) ......................................................................... 27, 30, 34 Leone v. United States, 910 F.2d 46 (2d Cir. 1990) ............................................................................. 9, 12 Lurch v United States, 719 F.2d 333 (10th Cir. 1983), cert. denied, 466 U.S. 927 ................................ 35 MB Industries, LLC v. CAN Ins. Co., 74 So.3d 1173 (La. 2011) ................................................................................... 31 Penn. Ins. Guar. Ass’n v. Sikes, 590 So.2d 1051 (Fla. Dist. Ct. App. 1991) ......................................................... 40 Reliance Ins. Co. v. Havens, No. 84995, 2005 WL 914688 (Ohio Ct. App. 2005) .......................................... 28 Rodriguez v. Fredericks, 213 A.D.2d 176 (1st Dep’t 1991) ...............................................15, 22, 23, 28, 41 - v - Rondeno v. Law Office of William J. Vincent, 111 So.3d 515 (La. Ct. App. 2013) ..................................................................... 31 Rudolf v. Shayne, Dachs, Stanisci, Corker & Sauer, 8 N.Y.3d 438 (2007) ........................................................................................... 25 Rupert v. Gates & Adams, P.C., 83 A.D.3d 1393 (4th Dep’t 2011) ................................................... 15 and Passim Sands v. New York, 49 A.D.3d 444 (1st Dep’t 2008) ......................................................................... 41 Santana v. N.Y.S. Thruway Auth., 92 Misc.2d 1 (Ct. Cl. 1977) ................................................................................ 41 Sawchyn v. Westerhaus, 593 N.E.2d 420 (Ohio Ct. App. 1991) ................................................................ 28 Segall v. Segall, 632 So.2d 76 (Fla. Dist. Ct. App. 1993) ............................................................. 30 Technical Packaging, Inc. v. Hanchett, 992 So.2d 309 (Fla. Dist. Ct. App. 2008), rev. denied, 6 So.3d 52 (Fla. 2009) ............................................................................................... 27, 30, 39 Time Terminals Inc. v. Egan, Flanagan and Cohen, P.C., 959 N.E.2d 1010, 2011 WL 7069275 (Mass. App. Ct. Jan. 23, 2012) .............. 36 Tivoli v. United States, No. 93-CV–5817, 1996 WL 1056005 (S.D.N.Y. Sept. 27, 1996), aff’d 164 F.3d 619 (2d Cir. 1998) ................................................................... 10, 12, 13 Williams v. United States, No. 03-CV-9909, 2007 WL 951382 (S.D.N.Y. Mar. 22, 2007)....... 10, 11, 12, 13 Zuckerman v. City of N.Y., 49 N.Y.2d 557 (1980) ................................................................................... 37, 38 - vi - STATUTES CPLR 5602(b)(1) ....................................................................................................... 2 Federal Tort Claims Act ....................................................................... 17 and Passim 28 U.S.C. § 1331 ...................................................................................................... 35 Fed. R. App. P. 10(a) ............................................................................................... 39 OTHER AUTHORITIES Ronald E. Mallen, Jeffrey A. Smith, 3 Legal Malpractice § 22:14 (2013 ed., available on Westlaw) ......................................................................................... 23 Steven Wisotsky, Appellate Malpractice, 4 J. App. Prac. & Process 577 (2002) .................................................................................................................. 29 Personal Injury Valuation Handbook (West 2011).................................................. 30 Cassandra Burke Robertson, The Right to Appeal, 91 N.C. L. Rev. 1219, 1224-25 (2013).................................................................................................... 35 Robert L. Haig, 3 Commercial Litigation in New York State Courts § 30:8 (3d ed., available on Westlaw)............................................................................ 38 QUESTIONS PRESENTED 1. Did the Appellate Division apply the proper legal standard for determining whether the plaintiff waived his legal malpractice claim by voluntarily discontinuing the underlying case at a time when his attorneys’ alleged errors could have been corrected and avenues to recovery in the underlying case remained? 2. Does the Appellate Division’s newly imposed requirement—that the full record in the underlying case be before the legal malpractice court to determine whether a legal malpractice claim is barred on summary judgment —conflict with this Court’s evidentiary standard for summary judgment as set forth by Zuckerman v. City of N.Y., 49 N.Y.2d 557 (1980)? - 2 - JURISDICTIONAL STATEMENT This Court has subject matter jurisdiction over this appeal because all requirements of CPLR 5602(b)(1) are satisfied. First, the action originated in New York State Supreme Court, Erie County. R. 24. Second, the Appellate Division issued a nonfinal Memorandum and Order. R. 471. Third, the Appellate Division granted the motion by defendants-appellants for leave to appeal to this Court. R. 469. Citations to the Record showing preservation of each issue raised in this appeal are set forth in the appropriate arguments and incorporated herein by reference. - 3 - PRELIMINARY STATEMENT Grace hired Michael R. Law (“Law”) and Phillips Lytle LLP (“PL”) to pursue a damages claim arising out of his treatment at the Veterans Administration Clinic (“VA”). Grace sued the VA in federal court for medical malpractice and negligence under the Federal Tort Claims Act. In discovery, the VA disclosed that Grace’s treating physician was not its employee (a fact previously admitted by the VA), but treated patients under a contract between the VA and the University of Rochester (“U of R”). Grace then amended his complaint to add claims against the physician and the U of R for medical malpractice and negligence. The VA, the physician, and the U of R moved for summary judgment to dismiss the claims. The federal district court granted partial summary judgment to the VA, dismissing the medical malpractice claim and holding that the physician was not a VA employee under the Federal Tort Claims Act. The district court also dismissed the medical malpractice and negligence claims against the physician and U of R as time-barred. Dismissal of the medical malpractice claim against the VA was contrary to federal law holding federal hospitals and agencies liable for a physician’s negligence where they exercised control over the physician. Dismissal of all claims against the physician and the U of R was contrary to the relation-back doctrine, which permits claims against the physician and the U of R to relate back - 4 - to the date the VA was sued. On de novo review, the appellate court would have reversed the district court’s order. Grace could have fully recovered by pursuing his remaining negligence claim against the VA or appealing the adverse summary judgment ruling. Grace instead abandoned the underlying case by voluntarily discontinuing it, with prejudice, to pursue this legal malpractice action against Law and PL. Law and PL moved for summary judgment on the ground that, under New York law, Grace waived any legal malpractice claim by voluntarily discontinuing the underlying case where there was an existing and valid cause of action that could have resulted in full recovery and the alleged legal errors could have been corrected on appeal. The trial court denied summary judgment without stating its reasons. The Appellate Division, Fourth Department affirmed in a 4-1 decision, with Justice Whalen dissenting. The majority refused to rule that Grace waived or abandoned his legal malpractice claims, even though it applied the waiver rule to a similar case just two years ago. The majority adopted a new standard borrowed from other states and held that to obtain summary judgment, Law and PL had to demonstrate that Grace would have been likely to succeed on appeal in the underlying case. The majority then chose not to even analyze Grace’s likelihood of success because it held that - 5 - Law and PL were required on summary judgment to submit the full record “that would have been before the Second Circuit on appeal.” Law and PL respectfully request that this Court reject the majority’s requirement that a legal malpractice defendant be required to submit on summary judgment the “full record” that would have been submitted on appeal in the underlying case. There is no New York authority that supports such a requirement, scant support elsewhere, and it is contrary to this Court’s well-settled evidentiary requirement for summary judgment. Law and PL respectfully request that this Court also reject the majority’s “likely to succeed on appeal” standard and hold that Grace’s voluntary discontinuance of his appeal and claim—which were not frivolous, and where the record before the court gave reasonable cause to believe that a valid appeal and claim existed—precludes him from suing Law and PL. This approach is consistent with prior New York law, addresses the primary policy concern raised by the majority (forcing the pursuit of meritless appeals), and results in fairness to all parties, judicial economy, judicial consistency, and predictability for litigants. We respectfully request that this Court reverse the Fourth Department, grant Law and PL summary judgment, and dismiss Grace’s legal malpractice claim against them. - 6 - STATEMENT OF FACTS A. Background This legal malpractice action arises out of a summary judgment dismissal of plaintiff-respondent John W. Grace’s (“Grace”) medical malpractice claims in a federal action brought in the Western District of New York (“underlying case”). R. 208. Law and PL initially represented Grace in the underlying case. R. 404. B. Grace’s treatment at the VA In 2002, Grace began receiving treatment for an eye condition at the Veteran’s Administration Rochester Outpatient Clinic from VA ophthalmologist, Dr. Shobha Boghani (“Dr. Boghani”). R. 213. Grace had a July 29, 2003 appointment scheduled with Dr. Boghani that was canceled by the VA. R. 213. The VA’s policy was to reschedule appointments that it canceled, but it failed to reschedule Grace’s appointment. R. 213. A year passed before Grace returned to the VA for his eye condition. R. 213. When Grace returned in August 2004, another VA ophthalmologist diagnosed him with neovascular glaucoma, a condition that left him blind in his right eye. R. 213. Dr. Boghani subsequently treated Grace at the VA through July 27, 2005. R. 213-214. In June 2006, Grace retained defendant-appellant Robert L. Brenna, Jr. (“Brenna”) and Brenna, Brenna & Boyce, PLLC (collectively, “the Brenna Defendants”) to pursue an administrative claim against the VA. R. 214, 17. Grace filed an administrative claim against the VA on August 9, 2006 alleging that the - 7 - VA committed malpractice by failing to diagnose his eye condition and negligently failing to follow-up with Grace after the VA canceled his appointment in July 2003. R 247, 249. C. Grace commences the federal court action In July 2007, while the administrative claim was pending, 1 Brenna recommended that Grace retain Law to pursue an action against the VA. R. 17, 403-404. On January 3, 2008, Grace sued the United States and the VA under the Federal Tort Claims Act alleging that: (i) the VA, through its employees, committed medical malpractice by failing to diagnose his eye condition; and (ii) the VA was independently negligent because it canceled the July 29, 2003 appointment and violated its established policy by failing to reschedule it. R. 63- 65. In its answer, the VA denied liability for alleged malpractice, but admitted that it employed, “among others, doctors, nurses . . . and other hospital personnel over which it exercises exclusive control and supervision with the right to employ and discharge . . . .” R. 404, 424, 64. While preparing for Dr. Boghani’s deposition in September 2008, the VA allegedly discovered that Dr. Boghani was not its employee, but instead was an employee of the U of R. R 70, 404-405. The VA had contracted with the U of R for medical personnel under an agreement that specified Dr. Boghani as one of two 1 The administrative claim against the VA was denied on April 10, 2008. R. 214. - 8 - physicians working at the VA. R. 135. Because PL regularly represents the U of R, Brenna was substituted for Law as Grace’s counsel. R. 405-406. On December 12, 2008, the district court granted a motion by the VA for leave to commence a third-party action against Dr. Boghani and the U of R. R. 78. On May 22, 2009, Grace’s complaint was amended to add Dr. Boghani and the U of R as defendants. R. 103. Dr. Boghani and the U of R moved for summary judgment to dismiss Grace’s claims against them as time-barred. R. 119. Shortly thereafter, the VA moved for summary judgment to dismiss Grace’s claims against it, alleging that there was no jurisdiction over the VA because Dr. Boghani was not its employee. R. 220-221. The VA made the motion notwithstanding its prior admission of Dr. Boghani’s employment, and notwithstanding its control, direction, and supervision of Dr. Boghani which made her an employee of the VA under the Federal Tort Claims Act. R. 404, 424, 64, 224-225, 125-127, 135-137. D. The district court dismissed all claims against Dr. Boghani and the U of R, and the medical malpractice claim against the VA On November 3, 2010, the district court granted the motion by Dr. Boghani and the U of R for summary judgment and dismissed Grace’s claims against them as time-barred. R. 239. The district court also granted the VA’s motion, in part, but only to the extent that it dismissed Grace’s medical malpractice claim against the VA based on Dr. Boghani’s conduct. R. 232. Grace’s negligence claim based - 9 - on the VA’s failure to reschedule the July 29, 2003 appointment was not dismissed. R. 232. As demonstrated below, the district court committed reversible error by determining that: (i) Dr. Boghani was not an employee of the VA under the Federal Tort Claims Act; and (ii) the relation-back doctrine did not apply to save Grace’s claims against Dr. Boghani and the U of R. A successful appeal to the Second Circuit would have corrected these errors and preserved Grace’s medical malpractice claim against the VA and all of his claims against Dr. Boghani and the U of R, thereby obviating the need for this legal malpractice action. E. The district court erred in finding that Dr. Boghani was not an employee of the VA Under the Federal Tort Claims Act, the VA is liable for Dr. Boghani’s negligence if Grace establishes that Dr. Boghani is a VA “employee” as defined by federal law. See Leone v. United States, 910 F.2d 46, 49 (2d Cir. 1990). To be treated as an employee under the Second Circuit’s factor-based “control” test, the evidence must show that the person’s “day-to-day operations are supervised by the Federal Government.” Leone, 910 F.2d at 50. District courts within the Second Circuit have applied the control test to facts that are nearly identical to those in the underlying case and determined that physicians working in government hospitals were employees of the federal government (or that a reasonable fact-finder could so conclude) for the purpose of - 10 - the Federal Tort Claims Act—even though those physicians were not actual employees of the government. See Tivoli v. United States, No. 93-CV–5817, 1996 WL 1056005 (S.D.N.Y. Sept. 27, 1996), aff’d 164 F.3d 619 (2d Cir. 1998) and Williams v. United States, No. 03-CV-9909, 2007 WL 951382 (S.D.N.Y. Mar. 22, 2007). In Tivoli, the district court held that the doctors in question were under the control, direction, and supervision of the National Institute of Health (“NIH”) and thus were employees of NIH despite contrary language in a contract. 1996 WL 1056005, at *3-5. In Williams, the district court denied the VA’s motion for summary judgment, holding that a reasonable fact-finder could conclude that the doctor in question there was an employee of the VA. Id. *12. There, the VA argued that a gynecologist was not its employee because the VA did not pay the gynecologist and because the gynecologist made clinical decisions according to his independent judgment without direct supervision by the VA. Id. *10. The court rejected the VA’s argument, noting that: (i) the VA controlled the gynecologist’s work hours, vacation time, where he worked, who he saw, and what he did during those hours; (ii) the VA controlled the patients he was required to see, which included all female patients; (iii) the VA required the gynecologist to perform his services in accordance with VA policies and procedures and the regulations of the medical staff bylaws of the VA facility; (iv) the gynecologist used the VA’s equipment and - 11 - facilities when performing surgeries; and (v) the gynecologist could only work at the VA if the VA approved his placement. Id. *11-12 (quotation marks omitted). In the underlying case here, the district court, likewise, noted the following undisputed facts: (i) the VA determined Dr. Boghani’s work schedule, the number of patients she treated, and set her clinic hours; (ii) the VA scheduled Dr. Boghani’s appointments by providing her with a list of patients to treat on days she worked at the VA clinic; (iii) the VA required Dr. Boghani to comply with the VA’s policies, procedures, and regulations of the medical staff bylaws; (iv) the VA required Dr. Boghani to use the VA’s medical records system and forms; (v) the VA provided Dr. Boghani with medical equipment; and (vi) the VA medical director retained the right to review Dr. Boghani’s qualifications. R. 209-211, 224. In addition to all of the foregoing, the contract between the VA and the U of R specifically required that the U of R hire Dr. Boghani to work at the VA and set her salary and benefits. R. 135, 127. 2 Further, in the underlying case, it was the VA—not the U of R—that notified Dr. Boghani of her deposition in 2008, characterizing it as an “Administrative Tort Claim.” R. 185. Specifically, the VA’s Risk Manager directed Dr. Boghani to “advise your immediate supervisor of 2 The contract between the VA and the U of R also provided that: (i) services performed “shall be under the general direction of the VA[] Lead Medical VA Care Line … Physician”; (ii) Dr. Boghani must “provide subspecialty consults, which include cornea, medical retina, neuro- opthalmology, oculoplastics and glaucoma”; and (iii) the VA “shall be allowed to periodically conduct Quality Reviews.” R. 126, 127, 136. - 12 - this proposed date for deposition as you will likely be unavailable much of that work day.” R. 185. Although the VA exercised nearly identical control over Dr. Boghani as the NIH and VA exercised over the doctors in Tivoli and Williams, respectively, the district court determined, on summary judgment, that the “control” test was not satisfied and that Dr. Boghani was not an employee of the VA. R. 224. Applying the control test and analogous cases, and construing the facts in a light most favorable to the nonmovant, the Second Circuit on de novo review, would have reversed and reinstated the medical malpractice claim against the VA. F. The district court erred in finding that the relation-back doctrine did not apply The district court erroneously determined that the relation-back doctrine did not apply because Dr. Boghani and the U of R were not united-in-interest, and because Dr. Boghani did not know, or have reason to know, that Grace’s claims would have been brought against her but for the mistake about the status of Dr. Boghani’s employment. R. 236-237. With respect to the former determination, the district court merely applied its earlier finding of Dr. Boghani’s employment status under the Federal Tort Claims Act and determined that if Dr. Boghani was not a VA employee, she could not be united-in-interest with it. R. 236-37. Because, as discussed above, the VA’s control over Dr. Boghani satisfied the “control” test set forth in Leone and applied - 13 - in Tivoli and Williams, Dr. Boghani should have been considered an employee of the VA. As such, Dr. Boghani, the U of R, and the VA were united-in-interest. See Austin v. Interfaith Med. Ctr., 264 A.D.2d 702, 704 (2d Dep’t 1999) (“The Hospital is vicariously liable for the malpractice of [doctor], . . . even though he was an independent contractor with the Hospital . . . and therefore, their interests are united.”) (citations omitted). As to the latter determination, the district court determined that Dr. Boghani and the U of R were unaware of the medical malpractice lawsuit until September 2008, when Dr. Boghani received a deposition notice. R. 237. However, the focus of this element is not whether the defendant knew, but whether the defendant could have reasonably concluded that the failure to sue within the limitations period meant that there was no intent to sue at all and that the matter has been laid to rest as far as they were concerned. See Buran v. Coupal, 87 N.Y.2d 173, 181 (1995). Here, Dr. Boghani could not have concluded that Grace had no intent to sue her because, in November 2006, the VA notified Dr. Boghani that Grace filed an administrative claim alleging that she committed medical malpractice. R. 214. 3 3 The district court found as an undisputed fact that “[o]n November 2, 2006, the VA notified Boghani that plaintiff had filed an administrative claim alleging malpractice that she committed. The notice directed Boghani not to discuss the claim with anyone outside the VA, and Boghani did not notify the U of R of the claim.” R. 214 (citations omitted). If Dr. Boghani was not an employee of the VA, as the VA alleged and the district court determined, what authority did the VA have to direct Dr. Boghani’s actions? If Dr. Boghani and the VA were not united-in-interest, why did the VA even send her the November 2, 2006 notice or the September 2008 notice referenced above? - 14 - At a minimum, an issue of fact existed as to whether Dr. Boghani was aware that Grace intended to commence litigation and had notice of Grace’s malpractice allegations within the limitations period. On de novo review, the Second Circuit would have reversed the district court’s determination that the relation-back doctrine did not apply. G. Grace voluntarily discontinues the underlying case and sues for legal malpractice Despite the adverse ruling on the medical malpractice claim against the VA, had Grace pursued his remaining negligence claim to conclusion, he may have obtained full recovery. Indeed, the negligence claim provided, by itself, a valid means of recovery based on the VA’s alleged failure to diagnose Grace’s eye condition and the effect of the VA’s contemporaneous negligent failure to reschedule Grace’s appointment, against its stated policy. Even if Grace’s pursuit of the remaining negligence claim was unsuccessful, upon final judgment, he could have pursued an appeal of the district court’s dismissal of the medical malpractice claim and dismissal of his claims against Dr. Boghani and the U of R. As set forth fully above, the district court disregarded relevant facts and applicable legal authority in determining, as a matter of law, that: (i) Boghani was not an employee of the VA under the Federal Tort Claims Act; and (ii) the relation-back doctrine did not apply to the claims against Boghani and the U of R. On de novo review, the Second Circuit would have reversed. - 15 - Rather than pursue any of his viable options in the underlying case, Grace hired new counsel and directed the Brenna Defendants to discontinue the underlying case. R. 430-431. As a result, on December 16, 2011 the underlying case was discontinued, Grace’s negligence claim against the VA was abandoned, and Grace’s appellate rights on the district court’s erroneous dismissal of the medical malpractice claims against the VA, Dr. Boghani, and the U of R were extinguished. R. 431. On December 5, 2011, before even discontinuing the underlying case, Grace targeted new defendants and sued Law, PL, and the Brenna Defendants for legal malpractice. R. 26. Grace alleges that Law and PL were negligent in failing to sue Boghani at the outset of the underlying case, resulting in the district court’s adverse ruling dismissing the medical malpractice claims against Boghani and the U of R. R. 30-32, 462. H. The Fourth Department refuses to apply Rupert and instead adopts the “likely to succeed” standard Law and PL moved for summary judgment to dismiss Grace’s legal malpractice action on the ground that Grace waived any legal malpractice claim by voluntarily discontinuing the underlying case at a time when the alleged errors could have been corrected. See Rupert v. Gates & Adams, P.C., 83 A.D.3d 1393 (4th Dep’t 2011); Rodriguez v. Fredericks, 213 A.D.2d 176 (1st Dep’t 1991). - 16 - By Order entered October 3, 2012, the trial court (Troutman, J.) denied Law and PL’s motion without stating its reasons. R. 9-11. Law and PL’s appeal to the Fourth Department followed. R. 6. The Fourth Department affirmed the trial court’s denial of summary judgment in a 4-1 decision. R. 471, 474. After noting that the “precise question presented”—whether a client abandons its legal malpractice claim by voluntarily discontinuing the underlying case and failing to appeal at a time when the attorney’s alleged errors could have been corrected — “appears to be an issue of first impression in New York,” the majority rejected Rupert’s waiver analysis citing policy considerations. R. 473-474. The majority stated that applying the waiver/abandonment rule articulated in Rupert: (i) would force parties to pursue “potentially meritless appeals” to preserve their legal malpractice rights, resulting in increased litigation costs and overburdened courts; (ii) could result in the expiration of limitations periods for legal malpractice claims due to the additional time spent pursuing appellate remedies in the underlying case; and (iii) would discourage settlements. R. 473-474. The majority adopted a new standard. Relying solely on out-of-state authority, the majority held that “defendants failed to establish that plaintiff was likely to succeed on an appeal from the November 2010 order and, therefore, that their alleged negligence was not a proximate cause of his damages.” R. 474 - 17 - (citations omitted and emphasis added). However, the majority never even applied its “likely to succeed” standard—again relying solely on out-of-state authority— because “the record before us does not include the full record . . . that would have been before the Second Circuit on an appeal.” R. 474 (citations omitted and emphasis added). In other words, the majority’s newly adopted standard required Law and PL: (i) to show that Grace was likely to succeed on appeal; (ii) based upon the full record that would have been before the Second Circuit. R. 474. The dissent disagreed and would have reversed the trial court order denying summary judgment on the ground that Grace “is precluded as a matter of law from bringing this legal malpractice action based upon his voluntary discontinuance of the underlying federal action and failure to pursue a nonfrivolous appeal.” R. 474. The dissent deemed it “important to note that if plaintiff had been successful in his appeal in the underlying federal action, we would not have a subsequent legal malpractice case.” R. 474. Having qualified the application of Rupert by adding a requirement that the appeal in the underlying action be nonfrivolous, the dissent next thoroughly analyzed the merits of that appeal and determined: Inasmuch as [Grace’s] theoretical appeal to the Second Circuit would have been before a panel for de novo review of whether there was a “genuine factual dispute” for resolution by a jury, [Grace] may have succeeded on appeal in - 18 - at least a reversal of defendant’s respective motions for summary judgment. R. 476. The dissent then addressed the majority’s policy arguments. As to the majority’s concern that applying Rupert would force parties to pursue potentially meritless appeals and overburden the courts, the dissent, noting its previous analysis, concluded “I do not view the appeal as meritless here.” R. 477. The dissent further concluded that judicial economy would actually be advanced by applying Rupert because, if the appeal in the underlying case is successful, then only one lawsuit would be required, the underlying case, instead of two, the underlying case and the legal malpractice action. R. 477. As to the majority’s concern about limitations periods expiring on legal malpractice claims, the dissent countered that the concern “is easily remedied,” because “nothing prevents plaintiffs from commencing a separate legal malpractice action that may be stayed until resolution of the underlying action, which includes resolution of any issues on appeal.” R. 477. Additionally, Grace could have obtained a waiver of the limitations period from defendants. R. 477. As to the majority’s claim that applying Rupert would discourage settlement and conflict with a plaintiff’s duty to mitigate damages, the dissent pointed out that predicting settlements is speculative due to the fact-specific nature of litigation, including the parties’ motives and means, and noted that one could easily conclude - 19 - the majority’s approach “interferes more with settlement . . . .” R. 477-478. The dissent further stated that “the proper way to mitigate damages in this case would have been for [Grace] to pursue his appeal and also to continue to litigate his remaining cause of action, which may have resulted in an award of some or all of his damages.” R. 478. The dissent highlighted two consequences that follow from the majority’s holding that are contrary to public policy. First, the majority’s “likely to succeed on appeal” standard substitutes the judgment of a single trial judge for that of an appellate panel, which subverts “an integral part of our judicial system” that is the appellate review process. R. 477. Second, and of equal, if not greater concern, the dissent stated that the majority’s standard enables a plaintiff “to select a new defendant that he or she may feel is an easier target before a jury than a physician or hospital would be.” R. 477. Underscoring the importance of this concern, the dissent stated: “I cannot see the merit in allowing a litigant, who does not give his or her attorney an opportunity to pursue a potentially meritorious appeal, to abandon his or her underlying case as a strategic decision in order to pursue a legal malpractice claim. . . .” R. 477. - 20 - ARGUMENT This case turns on the legal standard used to determine whether a legal malpractice plaintiff waives a claim against his former attorney by voluntarily discontinuing his underlying case when he could have obtained full recovery by way of an existing and valid cause of action and when his attorney’s alleged errors could have been corrected on appeal. As set forth in Point I below, the majority should have applied New York law and held that Grace waived his legal malpractice claim against Law and PL by voluntarily discontinuing the underlying case at a time when he could have obtained full recovery and the alleged errors in the underlying case could have been corrected. Rupert v. Gates & Adams, P.C., 83 A.D.3d 1393, 1396 (4th Dep’t 2011). The majority adopted a standard requiring Law and PL to establish that the appeal in the underlying case was “likely to succeed.” As set forth in Point II, the “likely to succeed on appeal” standard is based on policy considerations that are easily addressed, unfounded, or inapplicable. As set forth in Point III, the majority’s full record on appeal requirement is not well-grounded in New York law and underscores the soundness of the approach adopted by the dissent. Finally, as set forth in Point IV, requiring pursuit of an appeal or a claim— which are not frivolous, and where the record before the court gives reasonable - 21 - cause to believe that a valid appeal or claim exist—results in fairness to all parties, judicial economy, judicial consistency, and predictability for litigants. - 22 - POINT I UNDER NEW YORK LAW, GRACE WAIVED HIS LEGAL MALPRACTICE CLAIM The Fourth Department’s 2011 decision in Rupert v. Gates & Adams, P.C., held that a client waives his legal malpractice claim by voluntarily discontinuing the underlying case at a time when his former attorneys’ alleged errors could have been corrected. 83 A.D.3d at 1396 (citing Rodriguez v. Fredericks, 213 A.D.2d 176, 178 (1st Dep’t 1995)). In Rupert, the client alleged that his former attorneys erred in the underlying matrimonial case by: (i) failing to argue that the court should not value the entire amount of household goods as the client’s assets; (ii) failing to argue that the court should not double-count moving expenses assessed to the client; and (iii) failing to obtain a proper valuation of the client’s real property. 83 A.D.3d at 1396. The Fourth Department held that, notwithstanding the merit of the client’s allegations, summary judgment for the former attorneys was proper because the former attorneys’ errors “could have been corrected on an appeal from the final judgment”. Id. The client “consented to the dismissal on the merits of any appeal in the matrimonial action as part of … [a settlement and] by virtue of his … settlement, waived the right to raise those shortcomings in this legal malpractice action.” Id. The Fourth Department explained that the client’s voluntary actions “precluded pursuit of the very means - 23 - by which [the former attorneys’] representation of [the client] in the matrimonial action could have been vindicated.” Id. (citations omitted). In Rodriguez, the clients alleged that strategic choices made by their former attorney in the underlying case resulted in an unfavorable determination. 213 A.D.2d at 177-78. While the appeal from the underlying case was pending, the clients settled the case and then sued their former attorney for malpractice. Id. The First Department held that the clients, “by their own conduct in voluntarily settling prior to the appeal, precluded [their attorney] from pursuing the very means by which he could have vindicated his representation.” Id. at 178. The underpinning of the holdings in Rupert and Rodriguez is that the clients voluntarily entered into settlement agreements and discontinued their underlying cases while appeals were pending. As a result, their former attorneys were precluded from correcting their alleged errors. The holdings of Rupert and Rodriguez, articulated by New York courts as “waiver” and also referred to as “abandonment,” 4 should be applied here. After the medical malpractice claims against Dr. Boghani, the U of R, and the VA were dismissed, Grace had two avenues of recovery: (i) prosecute his remaining negligence claim against the VA to completion; and (ii) upon final judgment, appeal the dismissal of all claims 4 Abandonment has been characterized as the “the failure of the client to complete a lawsuit or pursue an appeal. Generally, the fact of abandonment is not a defense unless pursuit of the remedy would have made a difference.” Ronald E. Mallen, Jeffrey A. Smith, 3 Legal Malpractice § 22:14 (2013 ed., available on Westlaw). - 24 - against Dr. Boghani, the U of R, and the VA. Instead, Grace voluntarily chose, as a matter of strategy, to discontinue the underlying case, thereby abandoning his valid negligence claim and foregoing his right to appeal the district court’s erroneous grant of summary judgment. In so doing, Grace precluded his own chance of recovery and pursuit of the very means by which Law and PL’s representation of him in the underlying case could have been vindicated. Refusing to apply Rupert, the majority indicated that this case is distinguishable because the alleged malpractice here related to a missed statute of limitations. R. 473. The majority did not, however, explain how this distinction makes a difference. In fact, it does not make a difference because Grace’s appeal in the underlying case, if successful, would have remedied the alleged legal error and avoided this legal malpractice action. Grace voluntarily chose not to have this legal issue reviewed. As noted at pp. 12-14, above, the statute of limitations defense in the underlying case existed as a result of the district court’s erroneous determination of Dr. Boghani’s employment status under the Federal Tort Claims Act. A successful appeal of that erroneous determination would have resulted in reinstatement of the medical malpractice claims against the VA, which would have included the medical malpractice by Dr. Boghani. A successful appeal on the application of the relation-back doctrine also would have resulted in reinstatement of the medical - 25 - malpractice claims against Dr. Boghani and the U of R. Either, or both, of those occurrences would have negated the need for this legal malpractice action. Stated otherwise, to establish a claim for legal malpractice, a plaintiff must prove that the attorney “‘failed to exercise the ordinary reasonable skill and knowledge commonly possessed by a member of the legal profession’ and that the attorney’s breach of this duty proximately caused plaintiff to sustain actual and ascertainable damages.” Rudolf v. Shayne, Dachs, Stanisci, Corker & Sauer, 8 N.Y.3d 438, 442 (2007). Having voluntarily discontinued his valid and remaining negligence claim against the VA for failing to diagnose his eye condition and failing to reschedule his appointment against its stated policy, Grace simply cannot prove that it was the negligence of Law and PL—instead of his voluntary discontinuance—that proximately caused his damages. Further, given Grace’s voluntary discontinuance of his claim and consequential abandonment of his appeal against the VA, Dr. Boghani, and the U of R, there are no circumstances under which he can prove that any alleged breach of duty by Law and PL caused him to sustain actual and ascertainable damages. The Fourth Department should have applied its prior holding and dismissed Grace’s legal malpractice claims against Law and PL. It should have found that, - 26 - given Grace’s discontinuance of the underlying case, he cannot prove that Law and PL are a proximate cause of his damages. - 27 - POINT II THIS COURT SHOULD REJECT THE “LIKELY TO SUCCEED ON APPEAL” STANDARD The majority, relying on authority from “our sister states”, held that Law and PL must establish that their former client, Grace, was likely to succeed on an appeal in the underlying case to prove that their alleged legal error was not a proximate cause of his damages. 5 R. 473-474 (citing Crestwood Cove Apts. Bus. Trust v. Turner, 164 P.3d 1247, 1252 (Utah 2007) 6 ; Hewitt v. Allen, 43 P.3d 345, 348 (Nev. 2002); Technical Packaging, Inc. v. Hanchett, 992 So.2d 309, 316 (Fla. Dist. Ct. App. 2008), rev. denied, 6 So.3d 52 (Fla. 2009)). While the “likely to succeed on appeal” standard has been adopted in Florida and Nevada, it is not a generally accepted standard and, as set forth more fully below, policy reasons do not compel adopting it. 5 In opposition to Law and PL’s summary judgment motion, Grace did not argue that defendants had failed to establish that any alleged negligence on their part was not a proximate cause of Grace’s damages. Indeed, in the trial court, Grace offered no opposition to the waiver argument raised by Law and PL on their motion. See Addendum A, pp. 2-3. 6 Although the majority relies on Crestwood, the court there did not adopt the “likely to succeed on appeal standard.” Rather, the Crestwood court determined that case on causation principles. 164 P.3d at 1255-56. - 28 - A. The standards To the extent that this case presents an issue of first impression in New York, it bears noting that the standards for determining whether legal malpractice claims are barred by a client’s failure to appeal an adverse ruling are varied. They can be categorized as follows: (i) where the client voluntarily terminates the underlying case while the attorney’s alleged errors could be corrected (the waiver or abandonment rule); (ii) where the client is likely to succeed on appeal; and (iii) where a reasonably prudent party would have appealed. The waiver/abandonment rule. As discussed above, New York courts have held that a legal malpractice claim is waived if the client voluntarily discontinues or abandons the underlying case while the former attorneys’ alleged errors could have been corrected. Rupert, 83 A.D.3d at 1396; Rodriguez, 213 A.D.2d at 178. Ohio cases have reached the same conclusion. See Sawchyn v. Westerhaus, 593 N.E.2d 420, 423 (Ohio Ct. App. 1991) (“[The client’s] settlement of the original action prior to completion on appeal has extinguished his rights to hold [his attorney] liable and … [thus, the client] has waived his claim in the malpractice action against [his attorney.]”); Reliance Ins. Co. v. Havens, No. 84995, 2005 WL 914688, at *5 (Ohio Ct. App. 2005) (holding a legal malpractice claim barred where a client voluntarily settled an underlying case before allowing its attorneys to pursue a defense of the action). - 29 - The rationale favoring application of the waiver/abandonment rule is firmly imbedded in the judicial process. First, an appeal in the underlying action “is a safeguard that gives an attorney the opportunity to cure a nonprejudicial defect that could have been ‘judicial error rather than legal malpractice.’ If a favorable outcome on appeal could eliminate the injury complained of by the [former client] in the malpractice action, the [former client] will not be able to establish a redressable injury until the appeal in the underlying case is terminated.” Steven Wisotsky, Appellate Malpractice, 4 J. App. Prac. & Process 577, 585 (2002) (citations omitted). In this case, appellate review by the Second Circuit was particularly appropriate. The judicial error in the underlying case concerned a federal statute, namely the Federal Tort Claims Act, and resulted in a jurisdictional dismissal. The judicial error was compounded by the district court’s application of its incorrect determination under the Federal Tort Claims Act to the relation-back issue. A favorable outcome on appeal would have eliminated the injury complained of by Grace. Second, the waiver/ abandonment rule provides a bright-line rule for clear direction on how to proceed in the underlying case. The resulting certainty increases the efficiency and predictability of the legal system. Third, and perhaps most importantly, the waiver/abandonment rule prohibits clients from substituting their former attorney as a defendant based upon the belief - 30 - that attorneys are easier targets before a jury. As the dissent noted, rejecting the abandonment doctrine enables clients to pick defendants who may be less sympathetic to jurors than the initial defendants. R. 477. 7 The likely to succeed on appeal standard. As noted above, courts in Florida and Nevada have held that a former client’s failure to appeal an adverse ruling prevents the client from suing their former attorney only where the appeal was likely to succeed. See e.g., Technical Packaging, 992 So.2d at 312; Hewitt, 43 P.3d at 348-49 (citing Eastman v. Flor-Ohio, Ltd., 744 So.2d 499, 499-504 (Fla. Dist. Ct. App. 1999)). The “likely to succeed on appeal” standard has been adopted because a “bright-line rule that complete appellate review of the underlying litigation is a condition precedent to every legal malpractice action . . . [and] would, in many cases, violate the tenet that the law will not require the performance of useless acts.” Segall v. Segall, 632 So.2d 76, 78 (Fla. Dist. Ct. App. 1993) (“By engaging in conduct that led to the dismissal of their appeal, [former clients] foreclosed any determination that judicial error rather than attorney malpractice caused their loss in the underlying litigation, and waived their claim for malpractice.”). 7 The likelihood of recovery on a legal malpractice claim is statistically higher than almost any other professional negligence claim. Pertinent here, the overall likelihood of recovery on a legal malpractice claim is 57%, while against a doctor on a failure to diagnose medical malpractice claim it is 27%. See Personal Injury Valuation Handbook (West 2011) (excerpts attached as Addendum B). Given these statistics, plaintiffs with the choice of discontinuing their underlying case to sue their former attorney for legal malpractice will almost always choose to sue their former attorney. - 31 - The reasonably prudent party standard. A combination of the waiver/abandonment and “likely to succeed on appeal” rules has been adopted in Louisiana. The Louisiana Supreme Court held that a former client does not waive the right to file a legal malpractice action by failing to pursue an appeal of an underlying judgment “unless it is determined a reasonably prudent party would have filed an appeal, given the facts known at the time and avoiding the temptation to view the case through hindsight.” MB Industries, LLC v. CAN Ins. Co., 74 So.3d 1173, 1182-83 (La. 2011). Under this standard, the appeal’s likelihood of success is a factor, but the “analysis is heavily dependent on the specific facts” and “any relevant factors” should be considered. Id. at 1183. See also Rondeno v. Law Office of William J. Vincent, 111 So.3d 515, 524 (La. Ct. App. 2013) (barring legal malpractice claim because “a reasonably prudent man would not have voluntarily dismissed [the underlying case] from a court with proper jurisdiction and venue when the timeliness of the adding of a defendant was still at issue”). Rather than confining courts’ discretion to any singular factor, under this approach, courts weigh all facts in determining whether to preclude a client from suing his former attorneys. See Evanston Ins. Co. v. Kimmel, 2011–0526, 2011 WL 6288045, *2 (La. Ct. App. Dec. 14, 2011) (holding appeal of the underlying case was “clearly not meritless”, and client was barred from suing its attorneys). - 32 - B. The policy concerns identified by the majority are easily addressed The majority, in adopting the “likely to succeed on appeal” standard, first noted that applying Rupert “would force parties to prosecute potentially meritless appeals 8 to their judicial conclusion in order to preserve their right to commence a malpractice action, thereby increasing the costs of litigation and overburdening the court system.” R. 473-474. This policy concern is easily addressed. Law and PL, in fact, addressed the merits of an appeal in the underlying case. See Addendum C, at 9-14. The dissent, likewise, thoroughly analyzed the merits and concluded “I do not view the appeal as meritless here.” R. 477. In this regard, the dissent noted: Inasmuch as plaintiff’s theoretical appeal to the Second Circuit would have been before a panel for de novo review of whether there was a “genuine factual dispute” . . . plaintiff may have succeeded on appeal in at least a reversal of defendants’ respective motions for summary judgment. R. 476. Again, had Grace pursued his meritorious appeal, his medical malpractice claims against the VA, Dr. Boghani, and the U of R would have been reinstated and obviated the need for this legal malpractice action. The majority identified the consequences of forcing the pursuit of potentially meritless appeals as “increasing the costs of litigation and overburdening the court system.” R. 473-474. However, allowing former clients, as a matter of strategy, to 8 In opposition to the summary judgment motion by Law and PL, Grace did not argue at the trial court or Fourth Department that an appeal in the underlying case was meritless. - 33 - voluntarily discontinue any underlying case or appeal to pursue a legal malpractice action—unless that underlying case or appeal is frivolous or wholly without merit—will result in increased litigation costs and overburdening of the judicial system. As the dissent noted, 9 this legal malpractice action underscores the consequences of allowing a party to abandon an existing appeal: Importantly, the parties [here] will have to litigate the very issue that would have been decided on appeal in the underlying action in order to resolve the legal malpractice case. This will obviously result in additional costs, attorney’s fees and the use of court resources. However, should a litigant have to pursue an appeal that may correct a potentially erroneous trial court decision in the underlying litigation, a subsequent legal malpractice case may be avoided, thus saving costs and the use of court resources. R. 477. The other policy concerns identified by the majority are either addressable or unsupportable. To address the majority’s concern that the additional time spent pursuing an appeal could render the legal malpractice claim time-barred, Grace could have either: (i) sued for malpractice and then sought a stay of the legal malpractice case until the underlying case was concluded; (ii) obtained an 9 The dissent answered each of the policy considerations raised by the majority. R. 477-478. - 34 - agreement tolling the statute of limitations; or (iii) pursued the legal malpractice case and underlying case simultaneously. 10 R. 477; Hewitt, 43 P.3d at 346. The majority’s concerns that requiring parties to exhaust their appellate rights discourages settlement and potentially conflicts with an injured party’s duty to mitigate damages are unfounded. Predicting settlement postures is so dependent upon the facts of a particular case that it is wholly speculative to argue that applying Rupert would discourage or encourage settlements. The duty to mitigate damages is, likewise, not affected by applying Rupert because a successful appeal in the underlying case eliminates the need for a legal malpractice action. Even if an appeal in the underlying case is unsuccessful, the decision of the appellate court will narrow and focus the issues in the subsequent legal malpractice action. As noted by the dissent, Grace’s pursuit of his appeal and remaining claim was “the proper way to mitigate damages . . . .” R. 478. 10 Grace, in fact, sued this legal malpractice claim and then discontinued the underlying case. R. 24, 303. - 35 - C. Applying the “likely to succeed on appeal” standard here leads to results that are contrary to public policy Applying the “likely to succeed on appeal” standard to this legal malpractice action leads to three results that are contrary to public policy. First, applying the standard here substitutes the judgment of a state trial court for that of a federal appellate court on a question of federal law. The determinative question in the underlying case was whether Boghani was an employee of the VA under the FTCA, an issue that “is to be determined by federal law.” Lurch v United States, 719 F.2d 333, 337 (10th Cir. 1983), cert. denied, 466 U.S. 927. The majority’s “likely to succeed on appeal” standard places this distinct federal question with a state trial judge and divests the federal appellate court of its statutorily provided federal question jurisdiction. 28 U.S.C. § 1331. Second, a trial judge seeking to determine whether an appeal is likely to succeed will not have the same experience in evaluating decisions of other trial courts as would a panel of appellate judges. As noted by the dissent, “[t]he appellate review of disputed issues is an integral part of our judicial system, allowing for review, contemplation and determination of cases by a panel of justices or judges as opposed to a single one.” R. 477. 11 Removing review of 11 Appellate review serves the recognized functions of “correcting legal and factual errors; encouraging the development and refinement of legal principles; increasing uniformity and standardization in the application of legal rules; and promoting respect for the rule of law.” Cassandra Burke Robertson, The Right to Appeal, 91 N.C. L. Rev. 1219, 1224-25 (2013) (citations omitted). - 36 - questions of law from appellate courts will lead to the improper application of legal standards and inconsistent results. Third, the “likely to succeed on appeal” standard may result in the substitution of the judgment of a jury for that of an appellate panel on a question of law. The potential harm from this circumstance is significant because an appeal from a jury determination has a different standard of review than the de novo review on appeal. The question of what an appellate court would do is a question best answered by a court, not jurors. See Time Terminals Inc. v. Egan, Flanagan and Cohen, P.C., 959 N.E.2d 1010, 2011 WL 7069275, at *1 n.7 (Mass. App. Ct. Jan. 23, 2012). This circumstance will lead to inconsistent and unpredictable results. - 37 - POINT III THE REQUIREMENT OF THE FULL RECORD FROM THE UNDERLYING CASE CONFLICTS WITH THIS COURT’S HOLDING IN ZUCKERMAN After adopting its “likely to succeed on appeal” standard, the majority did not apply that standard. The majority instead wrote: Notably, the record before us does not include the full record from the underlying action, i.e. the record that would have been before the Second Circuit on appeal. Thus, while defendants may be able to show that their representation of plaintiff did not preclude him from prevailing in the underlying lawsuit or on appeal, they have not done so at this time. R. 474 (citations, inner quotation marks, and brackets omitted). The majority thus created a new hurdle for summary judgment in a legal malpractice action. 12 The standard on summary judgment, however, is well-settled. To obtain summary judgment, the movant must establish his defense sufficiently “by tender of evidentiary proof in admissible form.” Zuckerman v. City of N.Y., 49 N.Y.2d 557, 562 (1980) (citations omitted). Once the movant has established his prima facie case, the burden shifts to the nonmovant to “produce evidentiary proof in admissible form sufficient to require a trial of material questions of fact.” Id. If 12 Grace did not advocate, and the majority offers no explanation, for adopting the full record requirement. Grace did not even oppose Law and PL’s Rupert argument at the trial court and, for that reason alone, the Fourth Department should have reversed. Addendum A, at pp. 2-3. Adopting the full record requirement was seemingly the only way the Fourth Department could rationalize addressing the waiver argument at all. - 38 - the nonmovant cannot meet its burden, the movant is entitled to summary judgment as a matter of law. Id. 13 This Court requires the movant to tender “evidentiary proof in admissible form” to establish a prima facie case. Id. The record before the trial court and the Fourth Department included the district court’s decision in the underlying case, the contract between the U of R and the VA, and the pleadings in the underlying case. R. 208, 125, 63, 79, 91, 424. The undisputed facts set forth in the district court’s decision demonstrated that the VA exercised sufficient control, direction, and supervision over Dr. Boghani to, at least, create an issue of fact as to whether she was a VA employee under the Federal Tort Claims Act. R. 209-211, 224. The contract between the VA and the U of R further supports that conclusion. R. 125- 137. The Fourth Department’s new standard requires the attorney defendant moving for summary judgment to produce “the full record from the underlying case” to establish a prima facie entitlement to that relief. R. 474. By imposing this evidentiary standard, the Fourth Department’s holding conflicts with the summary judgment standard set forth by this Court in Zuckerman and creates the very expenses and burdens the majority sought to avoid. 13 In other words, whether the movant meets its prima facie burden does not turn on the volume of evidentiary proof tendered. Instead, it is “the existence or nonexistence of material issues of fact” that is determinative. See Robert L. Haig, 3 Commercial Litigation in New York State Courts § 30:8 (3d ed., available on Westlaw). - 39 - For example, here, the underlying case is venued in a federal court. On an appeal from a federal district court to a federal circuit court of appeals the record on appeal consists of the entire district court file which is transferred to the circuit court of appeals. See Fed. R. App. P. 10(a). The majority’s standard requires that attorneys copy the entire federal court file for inclusion on their motion. The majority’s standard, in fact, underscores the soundness of the approach adopted by the dissent. The same expenses that would have been incurred in the underlying case are incurred in a new action. Also, a new court is called upon to determine the same issues that would have been determined in the underlying case. It is more appropriate to have the appellate court in the underlying case hear and determine the appeal. A determination of judicial error by the appellate panel in the underlying case eliminates the need for a legal malpractice action. Alternatively, a determination of attorney error narrows and simplifies the issues in a legal malpractice action. Finally, there is scant legal authority supporting the majority’s full record requirement. No New York court has so held, and the majority relied on a Florida case for that proposition of law. R. 474 (citing Technical Packaging, 992 So.2d at 314-15). And other than the majority, no court has cited Technical Packaging for the proposition that a full record is required. However, other courts in Florida have determined that appeals from the underlying cases were likely to succeed without - 40 - expressly noting that a full record was a necessary condition. See Bradley v. Davis, 777 So.2d 1189, 1190 (Fla. Dist. Ct. App. 2001); Penn. Ins. Guar. Ass’n v. Sikes, 590 So.2d 1051, 1053 (Fla. Dist. Ct. App. 1991). Here, the salient portions of the record from the underlying case were before the trial court and the Fourth Department sufficient to determine the merit of the key issues in the underlying case. The full record requirement should be rejected. - 41 - POINT IV GRACE’S DISCONTINUANCE OF HIS APPEAL AND CLAIM—WHICH WERE NOT FRIVOLOUS, AND THE RECORD BEFORE THE COURT GAVE REASONABLE CAUSE TO BELIEVE THAT A VALID APPEAL AND CLAIM EXISTED—PRECLUDES HIM FROM SUING LAW AND PL The dissent, upon a thorough and careful analysis of current New York law, policy considerations, and the merit of the appeal in the underlying case, stated that it would have held a client “is precluded as a matter of law from bringing this legal malpractice action based upon his voluntary discontinuance of the underlying action and failure to pursue a nonfrivolous appeal.” R. 474. The dissent uses the terms “nonfrivolous” and “meritorious” interchangeably. R. 474-478. Like the dissent, other New York courts, in the context of civil claims against the state or state agencies, have held that “to be meritorious, a claim must not be patently groundless, frivolous, or legally defective, and the record as a whole must give reasonable cause to believe that a valid cause of action exists.” Sands v. New York, 49 A.D.3d 444, 444 (1st Dep’t 2008) (citing Santana v. N.Y.S. Thruway Auth., 92 Misc.2d 1, 11, (Ct. Cl. 1977)). Here, Grace’s discontinuance of his appeal and claim—which were not frivolous, and where the record before the court gave reasonable cause to believe that a valid appeal and claim existed—precludes him from suing Law and PL. This approach is consistent with the prior holdings in Rupert and Rodriguez, insures that clients are not forced to pursue meritless appeals, and reduces, if not - 42 - eliminates, the potentially harsh consequences that might result from a rigid application of the waiver/abandonment rule. At the same time, this standard deters unnecessary legal malpractice claims that cause litigants undue expense and burden the courts. This standard also insures that attorneys are not targeted as more attractive defendants and protects the integrity of the appellate process. In summary, this standard is consistent with prior New York law, addresses the policy concerns raised by the majority, and results in fairness to all parties, judicial economy, judicial consistency, and predictability for litigants. CONCLUSION For the foregoing reasons, this Court should reverse the Fourth Department’s July 19, 2013 Memorandum and Order, grant Law and PL summary judgment, and dismiss Grace’s legal malpractice claim against them. Dated: Doc #01-2728587.1 Buffalo, New York November 21, 2013 PHILLIPS LYTLE LLP glish . Devi Attorneys for Defendants-Appellants Michael R. Law/Phillips Lytle LLP One Canalside 125 Main Street Buffalo, New York 14203-2887 Telephone No.: (716) 847-8400 43 - ADDENDUM A Excerpts from Law and PL’s Reply Memorandum of Law to the Trial Court STATE OF NEW YORK SUPREME COURT : COUNTY OF ERIE JOHN W. GRACE, Plaintiff, Index No.: 12011-004732 vs. Assigned Justice: Hon. Shirley Troubnan MICHAEL R. LAW, et al. Defendants. REPLY MEMORANDUM OF LAW IN SUPPORT OF MOTION FOR LEAVE TO AMEND AND FOR SUMMARY JUDGMENT PRELIMINARY STATEMENT This memorandum of law is submitted in reply to plaintiff's opposition to the cross-motion by defendants Michael R. Law ("Law") and Phillips Lytle LLP ("Phillips Lytle") (Law and Phillips Lytle will be collectively referred to as "Law") for leave to amend and for sununary judgment. Most significantly, and as set forth more fully in Reply Point I, plaintiff has failed to dispute any material fact or offer any contrary authority to defeat summary judgment based upon his voluntary discontinuance of the underlying medical malpractice action. REPLY POINT I PLAINTIFF HAS FAILED TO DISPUTE ANY MATERIAL FACTS AND HAS OFFERED NO CONTRARY AUTHORITY On a motion for summary judgment, once the moving party makes a primn facie showing that it is entitled to judgment as a matter of law, the burden shifts to the non-moving party to "come forward with evidence" addressing the defendant's claim. Pommells v. Perez, 4 N.Y.3d 566 (2005). If the non-moving party does not make an attempt to meet this burden, then judgment should be entered for the moving party. Tyson v. Nazarian, No. 294 CA 11-02068, 2012 N.Y. App. Div. LEJ