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The Work
March 31, 2009 9:00 AM
The Am Law Litigation Daily: March 31, 2009
Posted by Alison Frankel
Law Firms / Legal Malpractice
Stanford Financial Exec Facing Criminal Charges Sues Proskauer for Malpractice
Considering that former Stanford Financial CIO Laura Pendergest-Holt doesn't have money to pay her lawyers, she's getting a lot of legal help. On Friday, Anthony Buzbee of Houston's Buzbee Law Firm filed a suit for Pendergest-Holt, accusing Proskauer Rose and partner Thomas Sjoblom of legal malpractice, professional negligence, and breach of fiduciary duty.
The suit claims that before and during her February 17, 2009, meeting
with Securities and Exchange Commission investigators, Pendergest-Holt
believed that Sjoblom was acting as her attorney. "She was never
advised that the company's interests differed from hers, or that
Sjoblom represented the company and not her, and that was such a huge
conflict and could work to her detriment," Buzbee told The Am Law
Daily's Zach Lowe in an e-mail response to questions. (Buzbee is not
involved in Pendergest-Holt's criminal defense.)
And according to Buzbee, even when Sjoblom stated during
Pendergest-Holt's testimony that he only represented her to the extent
she was an officer of the company, "She didn't know what that meant,"
Buzbee said. "He didn't stop and advise her or do any of the things
that you would expect in such a situation....At some points [during her
testimony] he is coaching and instructing her, but at others he is not
protecting her at all."
Pendergest-Holt's complaint alleges that Sjoblom had a conflict of
interest: Unbeknownst to Holt, the night before he met with her to
prepare her to testify before the SEC, "Sjoblom had solicited a
multimillion-dollar retainer from Stanford to represent Stanford
personally."
Proskauer Rose spokesperson Joshua Epstein sent the Litigation Daily an
e-mail response to our request for comment: "We are reviewing the
complaint and will respond in the appropriate forum."
We've reported on the complexities of Sjoblom's role in the SEC's investigation of Stanford Financial and its executives.
For more details on his actions during Pendergest-Holt's
testimony--which resulted in her arrest on criminal charges of lying to
investigators--you can check out the two-part transcript here and here.
Proskauer didn't answer our question about who will be defending the
firm, although our Am Law Daily colleague Lowe reports that it's James
Cole at Bryan Cave, who confirmed the engagement but declines
additional comment. But here's an interesting question: If, as Sjoblom
seemed to say to the SEC, he didn't represent Pendergest-Holt in her
personal capacity, does she have standing to sue him for legal
malpractice? We're sure that's just one of the issues this tangled case
will eventually have to address. Stay tuned.
Appellate / Product Liability / Mass Torts
Packed House for Supreme Court Asbestos Case
The
lawyers arguing before the Supreme Court in Travelers Indemnity v.
Bailey, which could have huge repercussions in the tort system,
encountered a hot bench.
more 
Securities
Rare Securities Class Action Trial Begins in Years-Old Subprime Case
Years
before the phrase "toxic assets" became a cliche, the shareholders of a
mortgage company called Household International filed a class action in
Chicago federal district court, alleging that Household had engaged in
"a massive predatory lending scheme" that inflated the company's
financials. The trial in the case begins this week.
more
Product Liability / Mass Torts
For Trial Bar, It's Morning in America
Not long ago, trial lawyers were on the defensive in the nation's capital. Now they're making wish lists for legislation.
more
IP
TomTom, Meet BillBill: Dutch GPS Maker and Microsoft Settle Dueling Infringement Suits
Even
for a case filed in the rocket docket of the Eastern District of
Virginia, the settlement between Dutch GPS maker TomTom and Microsoft
had to set a speed record.
more
Law Firms
Have We Turned the Corner? Some Litigation Firms Are Now Hiring Associates--but There's a Catch
For litigators willing to switch sides, there are employment opportunities.
more
Edited by Alison Frankel
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