Gotek Energy, Inc. v. Socal IP Law Grp., LLP
208 Cal. Rptr. 3d 428
| Cal. Ct. App. | 2016Background
- GoTek retained SoCal IP as patent counsel; SoCal failed to timely file foreign patent applications (Japan, Brazil) and admitted negligence in Aug 2012.
- On Sept 26, 2012 GoTek retained Parker Mills (new counsel) to investigate malpractice by SoCal; Parker Mills sent SoCal a malpractice notice on Nov 5, 2012.
- On Nov 7, 2012 SoCal emailed GoTek stating it must withdraw and would no longer represent GoTek on any matters; SoCal asked where to send files.
- On Nov 8, 2012 GoTek requested immediate transfer of files to Armstrong Teasdale (replacement counsel) and emailed a signed transfer request; on Nov 15 SoCal shipped a CD of files.
- GoTek filed a malpractice complaint on Nov 14, 2013 (more than one year after Nov 8–15, 2012). Trial court granted SoCal summary judgment, finding the statute of limitations tolled by continuous representation had ended no later than Nov 8, 2012. The court also awarded SoCal $140,000 in attorney fees under the parties’ engagement agreement.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether § 340.6 continuous‑representation tolling continued past Nov 8, 2012 | Tolling continued because SoCal retained files and transferred them Nov 15, showing ongoing representation | Tolling ended when GoTek consented to SoCal's withdrawal (Nov 8) or at latest when SoCal expressly withdrew (Nov 7); file transfer was ministerial | Tolling ended no later than Nov 8, 2012; malpractice suit filed after one year was untimely |
| Whether file possession/transfer constitutes continued legal services | File transfer is part of ongoing legal representation | File transfer is clerical/ministerial and does not extend tolling | File transfer did not extend continuous representation; objective evidence showed representation ended |
| Whether SoCal violated ethical rule requiring time to secure successor counsel, so withdrawal was ineffective to end tolling | GoTek (for first time on appeal) argued SoCal still had obligations under Rule 3‑700(A)(2) to allow time for replacement counsel | SoCal noted GoTek consented to withdrawal and requested immediate transfer, so ethical rule not violated | Issue forfeited for failure to raise below; alternatively consent meant no Rule violation |
| Whether prevailing party attorney‑fees clause in the engagement agreement covers this malpractice action | Agreement did not clearly cover malpractice (tort) claims; Herbruck signed individually so corp not bound | Clause covers "any dispute relating to this agreement" and parties can contract for fees in tort or contract disputes; GoTek is bound by the agreement | Fee provision applies; trial court properly awarded fees under the agreement |
Key Cases Cited
- Aguilar v. Atlantic Richfield Co., 25 Cal.4th 826 (summary judgment standard)
- Beal Bank, SSB v. Arter & Hadden, LLP, 42 Cal.4th 503 (continuous‑representation tolling during attorney's representation)
- Truong v. Glasser, 181 Cal.App.4th 102 (statute of limitations for malpractice under § 340.6)
- Gonzalez v. Kalu, 140 Cal.App.4th 21 (when representation ends for § 340.6 purposes)
- Worthington v. Rusconi, 29 Cal.App.4th 1488 (objective standard: ongoing mutual relationship and activities in furtherance)
- Neel v. Magana, Olney, Levy, Cathcart & Gelfand, 6 Cal.3d 176 (malpractice can sound in tort and breach of contract)
- Santisas v. Goodin, 17 Cal.4th 599 (parties may contract for attorney fees in tort or contract disputes)