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RULING AGAINST LIABILITY INSURER IN SAN DIEGO MAY AFFECT POLICIES Unhappy with your professional liability insurance? You might be interested in a recent Southern California ruling, then. San Diego attorney Kenneth Sigelman sued his insurance provider, Lawyers’ Mutual Insurance Co., to prevent it from making him reimburse up to $1.2 million in settlement and defense costs paid out on his behalf over the last few years. Last week, Sigelman’s lawyer, Guy Kornblum, won a ruling in San Diego that he said will inevitably force Lawyers’ Mutual to revise a standard contract used by many California lawyers. “They’ve been using the same policy for 20 years,” said Kornblum, who heads San Francisco’s Guy Kornblum & Associates. Sigelman’s case was over a claims-made policy, a type that generally covers claims made against a policyholder during a given period of time � no matter when the trigger incident occurred. On Jan. 31, a San Diego County Superior Court judge ruled that part of Sigelman’s claims-made policy is ambiguous because the fine print lays out exclusions that suggest the agreement is of a different nature altogether, one that only covers incidents that occurred while the contract was in effect. That type of agreement would be known as an occurrence policy. The San Diego court found that the disputed insurance policy “is not sufficiently conspicuous, plain and clear to be enforceable,” according to a court transcript (.pdf). Defense lawyer Kenneth Katel, a Los Angeles partner at Musick, Peeler & Garrett, said it’s too early to say how Lawyers’ Mutual will change its insurance policy � if at all � or if the company will appeal. But even if other lawyers don’t benefit, it was a much-needed break for Sigelman, who was sued twice for malpractice in recent years. One of Sigelman’s insurance claims arose from a situation a trial court judge aptly described as a “horror story,” according to the First District Court of Appeal’s published decision in Duran v. St. Luke’s Hospital, 114 Cal.App.4th 457. Sigelman was sued by a client because he failed to file a complaint before the statute of limitations ran out for medical malpractice that allegedly caused the death of an infant child. In fact, Sigelman sent in the complaint, according to Duran. But because he underpaid the filing fee by $3, the case was never properly filed and was later dismissed by a San Francisco Superior Court judge.

Matthew Hirsch

MALPRACTICE SUIT NO SLAPP When a disgruntled client sued for malpractice, San Mateo attorney Bradley Kass responded by filing a motion to dismiss under the state’s anti-SLAPP statute. He argued that he had done his best for his client and that his work for her constituted protected activity for which he couldn’t be sued. Last week, San Francisco’s First District Court of Appeal disagreed and let Marion Walsh’s suit proceed. Walsh, identified in the ruling(.pdf) as a postal carrier, hired Kass � a partner in Kass & Kass � to represent her in a San Francisco Superior Court suit against a customer she claimed had assaulted and injured her. The defendant won at trial. Walsh then sued Kass claiming that, among other things, he didn’t call any percipient witnesses, hadn’t warned her about the consequences of rejecting a settlement, breached client confidences, failed to perform a competent investigation, and exploded in anger, throwing his briefcase at her during a settlement conference. In his motion to strike the suit as a Strategic Lawsuit Against Public Participation, Kass argued that there were no percipient witnesses to call, he had fully explained the consequences of failing to settle, and that he hadn’t gotten angry at the settlement conference. The justices unanimously held that the suit didn’t challenge speech regarding a public issue. “Kass’ conduct involved only the rights of two private individuals who had been involved in an altercation,” Justice Sandra Margulies wrote, “with no implications for the public at large beyond its ordinary interest in the proper administration of justice. The subject of the litigation was a private matter, unconnected to any public issue.” Justices James Marchiano and Douglas Swager concurred. Margulies also found that Walsh’s allegations against Kass didn’t come under the anti-SLAPP statute because they didn’t concern Kass’ statements or other expressive acts, but rather his failure to act or speak. “For example,” she wrote, “Walsh alleges that he failed to advise her properly with respect to settlement risks, failed to call appropriate witnesses, failed to disclose a conflict of interest, failed to investigate her case thoroughly, and failed to keep her informed about the litigation. “None of these failures,” she added, “constituted an affirmative public expression of ideas.” Margulies, however, noted that Walsh’s suit made one allegation that wasn’t about a failure to act � getting angry and throwing a briefcase. Nonetheless, the court found that act � albeit in a public hallway � didn’t fall within the “official proceedings” protected by the anti-SLAPP statute. “It was neither made during an official proceeding nor submitted to an official body,” Margulies wrote. “Rather, the outburst occurred in a hallway, unconnected with any ongoing hearing.” Kass couldn’t immediately be reached for comment Friday. The unpublished ruling is Walsh v. Kass, A112656.

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