A decade-long battle between a construction company and a Somerset County school board and its attorney, pending before a federal circuit court could determine what lawyers are allowed to say before litigation starts.
The New Jersey State Bar Association, which is seeking to be amicus in the matter, says it could be a game-changer if the U.S. Third Circuit Court of Appeals restricts the protections attorneys have had for years regarding pre-litigation communications.
“The net result of any holding from the court that limits or deviates from the clear and wide berth of protection afforded to attorneys for litigation-related actions and words under the litigation privilege would be devastating to the practice of law throughout the circuit,” the New Jersey State Bar Association argued in an amicus filing, which was signed by Association General Counsel Sharon Balsamo with President Ralph J. Lamparello as co-counsel and Second Vice President Thomas H. Prol on the brief. The papers were filed earlier this month with the circuit. “Such a holding would chill attorneys from providing effective legal representation and would impair both the diligence and creativity that are essential for good, sound lawyering for fear of claims of civil liability for engaging in the reasonable and customary activities that attorneys take for their clients in the ramp-up to litigation.”
The dispute centers on a $30 million project to renovate and expand five schools in North Plainfield that started in 2001. After a public bidding process, the town’s board of education contracted with D&D Associates to do the work. Problems arose immediately, court papers claim. By 2003, the board believed the construction company had defaulted and terminated the contracts. The school board’s construction attorney, Robert C. Epstein, wrote four demand and termination letters to D&D, in advance of litigation.
After the contracts were terminated, the construction company sued in federal court, charging its due process rights were violated, property had been seized, and more. The construction company’s suit also named Epstein and charged him with defamation or tortious interference, related to the letters.
In trial court proceedings, U.S. District Court Judge Mary L. Cooper dismissed many of the construction company’s claims, but allowed the defamation and tortious interference claims against Epstein to go forward, saying pre-litigation immunity is subject to limits and there was some evidence the attorney acted outside of the scope of his responsibilities.
The case is now on appeal to the court of appeals in Philadelphia. An argument date has not yet been set.
Lawyers for D&D say Epstein interfered with the project, did not properly establish the facts to counter his arguments, and should be liable since the construction company suffered as a result of the contract termination.
“His actions go far beyond acting as counsel… Epstein improperly issued default letters and rewrote job correspondence reserved for the board and construction professionals,” Timothy Korzun, who represents the construction company. Further, the company claims, there is no evidence in the record that the board ordered Epstein to write the letters.
Epstein’s lawyers say the claims are barred because he was acting on behalf of the board and that the letters were sent after it was clear litigation was in the future. Further, his comments were not defamatory or false, wrote one of his attorneys, Joseph LaSala, in court papers.
“The communications on which these counts are based are all communications and statements made by an attorney acting in the course of his representation of his client. As a result, Epstein’s communications as counsel to the board are encompassed by the absolute litigation privilege. That privilege protects attorneys from civil liability arising from communications exchanged in connection with, and in advance of, civil litigation,” wrote LaSala.
The New Jersey State Bar Association contends a great deal is at risk if Epstein’s communications aren’t protected.
The letters he wrote are protected under New Jersey law. Indeed, actions like those Epstein took are appropriate and necessary, and just the kind of thing lawyers around the circuit do every day on behalf of and in defense of clients. Wide protection under the litigation privilege is warranted, the state bar association wrote in court papers.
“There is nothing defamatory in any of them, let alone any untruthful statement that is made with actual malice, as would be required here …Mr. Epstein, like thousands of other attorneys in similar circumstance, found himself on the horns of a dilemma, faced with a choice of protecting his client or incurring the wrath of a likely future opposition litigant whom he felt was harming his client. The choice was resolved appropriately by Mr. Epstein who followed his client’s direction and took the legally permissible and, indeed, mandated action an attorney should take in protecting a client and its legal interests,” according to the association brief.