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May 2016 Archives

$1.29 Million Texas Legal Mal Suit To Proceed

Texas Supreme Court rules Australian man's breach of fiduciary duty and legal mal suit against Texas firm can proceed.

After a $1.29 million judgement against DLA Piper was thrown out by an intermediate court of appeals, the Texas Supreme Court has ruled an Australian businessman's breach of fiduciary duty and legal mal suit against the firm can proceed. The background to the case Linegar v. DLA Piper is as follows. Chris Linegar of Australia was a major stockholder in a company called IdentiPHI. DLA Piper represented a company called Saflink that merged with IdentiPHI. Following the merger, DLA Piper was corporate counsel for IdentiPHI. During the merger process, IdentiPHI needed a short-term bridge loan. Linegar arranged to lend the company nearly $2 million Australian dollars from his retirement trust fund. DLA Piper represented IdentiPHI in the transaction and also worked directly with Linegar. When it became apparent the IdentiPHI was going to default on the loan, Linegar later discovered that his financing statement had not been perfected to protect his interest in IdentiPHI's assets. IdentiPHI ultimately filed for bankruptcy in the United States. Had the security interest in the loan been protected, Linegar would have received the full amount of his loan back. Instead, he received $150,000 in a settled bankruptcy claim. Linegar sued DLA Piper for legal malpractice and breach of fiduciary duty in a Travis County district court claiming the firm had advised him individually regarding the loan assuring Linegar that it would be perfected. At trial, Linegar alleged the firm told him his loan was secured and "everything would be taken care of." But the firm disputed those statements at trial and argued that they never agreed or implied that they would look after Linegar's individual interests. A jury ruled against DLA Piper, finding among other things that the firm injured Linegar by negligently failing to advise him that the firm did not represent him, committed fraud by failing to disclose a material fact to Linegar and that there was an attorney client relationship between the parties. The jury awarded Linegar $1.29 million in damages. DLA Piper appealed the judgement in the case, raising eight issues on appeal. But Eastland's Eleventh Court of Appeals only needed one issue to reverse and render judgement for DLA Piper--standing. The firm convinced the Eleventh Court that Linegar lacked standing because his company, not Linegar individually, was the holder of the note. The Eleventh Court also concluded that any misrepresentation about the secured status of the loan would have been made to Linegar's company, which was named Zaychan. Linegar appealed the defense ruling to the high court, arguing that DLA Piper mischaracterized his claim as a suit on the note. Rather, Linegar sued the firm for legal malpractice, he argued. And after considering relevant case law, Justice Phil Johnson concluded that Linegar had standing to sue DLA Piper, reversing and remanding the case back to the Eleventh Court to consider the firm's other appellate issues. "The case was pleaded, tried and submitted to the jury on claims that DLA Piper violated duties it owed to Linegar in his individual capacity and that those violations proximately caused damages to him individually," Johnson wrote. "As noted above, there was evidence to support the allegations. That is sufficient to show standing, which is the only issue before us." Lisa Hobbs, a partner in Austin's Kuhn Hobbs who represents Linegar before the Texas Supreme Court, was elated with the decision. "It's a big win. We're excited,'' Hobbs said. "The court did remand it back to the court of appeals because DLA has raised other issues. But we feel great about those issues as well." Russell Post, a partner in Houston's Beck Redden who represents DLA Piper before the high court, declined to comment on the decision. Originally posted by John Council on Legal Mal Suit Representation - Ball & Bonholtzer Trial Attorney - Los Angeles  

Prejudgment Remedy Ordered In Breach Of Fiduciary Case

In breach of fiduciary case against attorney accused of improper eviction, judge orders prejudgment remedy.

A judge has ordered a prejudgment remedy against an attorney accused of mishandling the estate of a Connecticut woman and improperly evicting two of her daughter's from the family home. Connecticut Attorney Thomas Drew, whose law firm website says he focuses on estate planning and administration as well as elder law, has denied wrongdoing. But a Judge Robert Genuario has nevertheless awarded an $18,000 prejudgment remedy to Connie Grant, who sued Drew in Stamford Superior Court in 2014, claiming that the lawyer's actions left her "homeless and destitute."

Attorney Pleads Guilty In $33M California Fraud Case

Tucson lawyer pleads guilty in southern California real estate fraud case.

Attorney Jeffrey Greenberg of Tucson, along with Courtland Gettel of Coronado, pleaded guilty May 17 in a $33-million real estate

fraud case in California. Charges in the U.S. District Court in the Southern District of California included conspiracy and wire fraud conspiracy.

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