A state appeals court has ruled that Olshan Frome Wolosky must continue to face a $21 million legal malpractice suit based on claims it didn’t file a financing statement needed to perfect a loan’s security interest, rejecting the firm’s arguments that the malpractice action is based on “gross speculations on future events.”

In knocking back the Manhattan-based law firm’s motion to dismiss the 2016 malpractice suit filed against it by a former hedge fund client, a unanimous panel of the Appellate Division, First Department court wrote, “Contrary to defendant’s [Olshan Frome Wolosky’s] contention, the allegations underlying the [lawsuit’s] claim are not ‘couched in terms of gross speculations on future events,’” quoting Phillips-Smith Specialty Retail Group II v Parker Chapin Flattau & Klimpl.