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Professional Services Litigation

Professional services firms are businesses and like other commercial entities they face the challenges of doing business in a competitive marketplace. Cole Schotz has experience handling commercial disputes for all types of professional services firms -- from publically-traded financial advisory firms to small and mid-size law firms and accounting firms.

Even the most reputable and diligent professionals are not immune from claims of negligence, malpractice or regulatory action. We understand that an assertion of malpractice or negligence can damage reputation and disrupt business. Our experience in defending against such claims has proven invaluable to our clients.

For decades, we have counseled professionals on the sensitive issues unique to their business endeavors. Drawing on the broad experience across our firm, we respond to the needs of those facing potential licensing or liability concerns. Services include:

• Professional liability
    o Defend against bankruptcy related claims
        • avoidance actions
        • fee objections and disgorgement claims
        • D&O insurance claims

    o Defend against claims of malpractice and negligence
        • Legal malpractice
        • Accounting and tax malpractice

• Government investigations
    o SEC investigations and enforcement proceedings
    o Grand jury investigations – white collar
    o PCAOB proceedings (Public Company Accounting Oversight Board)
    o False Claims/Qui Tam (whistleblower)

• Risk/solutions management
    o Expert witness
    o Employment and partnership disputes
    o Information governance and eDiscovery
    o Class action

 

Professional Services Litigation Representative Matters

  • Represented an international consulting and financial services firm in connection with collecting unpaid invoices for services rendered. Our representation included commencing lawsuits and arbitration proceedings in various jurisdictions. We also counseled this client with respect to the content of their client engagement agreements to provide them with the most protection in the event of litigation.
  • Represented one of the leading criminal defense firms in New Jersey to defend a fraudulent transcript complaint filed on behalf of a Chapter 7 bankruptcy trustee. The trustee sought damages of approximately $1.4 million. We withdrew the reference to the Federal District Court and, after extensive discovery, moved for summary judgment. The motion was granted in an opinion and the complaint was dismissed. Thereafter, plaintiff’s appeal to the Third Circuit was settled for a nominal payment.
  • Represented a large full-service advisory and accounting firm in relation to a complaint alleging that the predecessor in interest to the accounting firm, was grossly negligent and or acted with reckless disregard or willful misconduct in the preparation of audited financial statements for a retirement plan. Involved before the complaint was filed, representing the accounting firm and working closely with its in-house professionals, we conducted detailed analysis and diligence regarding the potential outcomes of any litigation and sought to engage the trustee in settlement negotiations. After the complaint was filed, we filed a motion to dismiss on, among other things, constitutional grounds that even if the retirement plan was damaged by an act or failure to act by the accounting firm, the debtors’ estates were not damaged; any damage was to the retirement plan and the beneficiaries. Moreover, because the debtors’ estates were not damaged, the trustee had no constitutional standing to bring the claim. The Bankruptcy Court dismissed the malpractice claims. The decision was upheld on appeal to the District Court.
  • Represented a prominent New York City criminal defense firm in connection with a Chapter 7 trustee’s attempt to recover a retainer and subsequent payments to the firm that allegedly originated from an offshore trust the Chapter 7 trustee claimed was property of the client/debtor’s bankruptcy estate. We obtained summary judgment in the Bankruptcy Court, and affirmances in both the United States District Court for the District of New Jersey and the United States Court of Appeals for the Third Circuit.
  • Represented a group of financial restructuring professionals in connection with an arbitration brought by their former employer (a publically-traded financial advisory firm) in which the former employer asserted contract and tort claims relating to the employees’ departure and establishment of their own firm.
  • Represented a consulting firm in litigation against a former employee for cyber defamation and libel, obtaining a favorable out-of-court settlement that included both a retraction and removal of all offending content and a substantial monetary payment. 
 

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