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.
A repayment dispute arose and Quantum sought an injunction to prevent Empire from issuing the reserved shares to the lenders. When the lenders intervened in the action, they were represented by the same law firm that had been retained by Quantum in 2016. The spokesperson of the law firm declined to comment on the case.
Legal malpractice claims might arise due to conflicts of interest or for other reasons. Individuals and businesses that have suffered harm as a result of professional malpractice might want to speak with an attorney. A lawyer with experience handling legal malpractice claims might be able to help by looking for areas where legal representation fell below the acceptable standards. Damages for attorney malpractice are generally defined by the underlying case, meaning that the recovery for malpractice will usually not exceed the value of the case that led to the malpractice action.