San Rafael California Insurance Law Firm

A $100 million legal malpractice lawsuit has been filed claiming a conflict of interest as a law firm allegedly represented both the lenders and the borrower during a legal action related to promissory notes. The plaintiff company in the case claims the law firm engaged in deceptive practices and breached fiduciary duties. California readers might be interested in the specifics of the case.

According to court filings, a Texas company called Quantum retained the law firm in 2016 and that representation continued even though Quantum ceased giving the firm work after some time. Thereafter, in 2017, Quantum issued promissory notes to two other companies. As part of that transaction, a fourth company, Empire Stock Transfer Inc., was authorized to reserve shares of common stock sufficient to compensate the lenders in the event that the terms of the notes were not honored.

Businesses and individuals in California and around the country rely on professionals such as attorneys, accountants and brokers to manage their affairs, and both professionals and their employers can face severe penalties when documents required by state or federal law are falsified or not submitted in a timely manner. One such case involves an accountant who served as the chief financial officer of a leading management consulting company between 2008 and 2016. Media accounts reveal that the man has been indicted in connection with a scheme that allegedly led to his employer underreporting approximately $12 million in workers' compensation expenses.

According to prosecutors, the man falsified his employer's periodic filings with the Securities and Exchange Commission by improperly reporting workers' compensation costs as fees and payroll taxes. The man is said to have taken advantage of the scheme by selling 35,300 shares that he had purchased using his stock options for $467,261. Court records reveal that the man received more than $2.4 million when he sold the shares.

Some art aficionados in California may have heard about a dispute between companies owned by two prominent art collectors involving a mixed-media work by Frank Stella that has resulted in a lawsuit against another gallery. The lawsuit was filed by Artemus in July in the New York Supreme Court against the Paul Kasmin Gallery. It alleges that the gallery falsified documents related to the Stella work.

According to the lawsuit, in 2016, there was a transaction between dealer Anatole Shagalov and his gallery, Nature Morte, and an art leasing company founded by collector Asher Edelman, Artemus. In all, there was a $3.4 million transaction between the two, and the Stella work was included along with a number of others. However, Artemus alleges that Kasmin still had a 40 percent share in the Stella painting and that this information was not disclosed.

You selected an insurance policy and paid premiums to obtain financial protection in the event of an accident, theft, fire or other problem. If a loss covered by the insurance contract occurs, you naturally expect to collect on a claim or at least appeal a denial of coverage. The rescission of an insurance policy, however, could not only surprise you but undermine your protection from loss. When a Florida insurance company rescinds your policy, it acts as if the contract never existed.

The insurer will base its decision on claims that you misled the company when you applied for the policy or filed a claim. The insurer essentially accuses you of fraud. In this situation, you might receive a refund of all premiums that you paid along with a declaration that the policy is void. Your refunded premiums, however, might not adequately compensate you for your losses, which could be substantial.