Joyce v. Armstrong Teasdale, LLP
2011 U.S. App. LEXIS 6388
| 8th Cir. | 2011Background
- Joyce invented the Heuristic Firewall and formed TechGuard with Magee circa 2000 to market the technology.
- Armstrong Teasdale provided legal services to TechGuard and also represented Joyce personally in patent matters during the period.
- Armstrong Teasdale drafted three TechGuard documents—the Confidentiality and Invention Rights Agreement, the Transfer Agreement, and the Patent License Agreement—signed January 1, 2001.
- Joyce was advised by Armstrong Teasdale that signing the agreements would not injure him, and that his and Magee's majority shareholding protected his interests.
- TechGuard later obtained SBA certification, but Joyce and Magee divorced in 2007; Magee received 50% of the patent in the divorce decree.
- Joyce filed suit on September 12, 2008, alleging breach of fiduciary duty by Armstrong Teasdale related to representing TechGuard’s exploitation of his technology.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| accrual timing for legal malpractice | Joyce argues damages accrue when injury is ascertainable, not when the wrong occurs. | Armstrong Teasdale contends accrual occurred when the agreements were signed (2001) and damages were ascertainable then. | Not decided here; remanded for accrual determination. |
| notice of injury to trigger accrual | Joyce did not have notice of injury when signing the agreements; the attorney's advice could have misled him. | Joyce would have known the effect of the agreements, giving rise to potential injury on signing. | Complaint does not establish accrual more than five years before filing on Rule 12(b)(6) grounds. |
| whether the complaint establishes a Missouri legal malpractice accrual rule at Rule 12(b)(6) | Under Missouri rules, accrual can be delayed if the client reasonably relies on attorney advice. | The complaint cannot establish accrual beyond five years without external notice of harm. | The complaint, at this stage, does not establish accrual more than five years prior. |
Key Cases Cited
- Stephens v. Associated Dry Goods Corp., 805 F.2d 812 (8th Cir.1986) (mandates accepting plaintiff's facts as true at 12(b)(6))
- Krentz v. Robertson, 228 F.3d 897 (8th Cir.2000) (de novo review of statute of limitations accrual)
- Klemme v. Best, 941 S.W.2d 493 (Mo.1997) (no duty to double-check attorney's work in absence of external notice)
- Zero Mfg. Co. v. Husch, 743 S.W.2d 439 (Mo.Ct.App.1987) (notice of attorney's wrongdoing may come from external source)
- Wright v. Campbell, 277 S.W.3d 771 (Mo.Ct.App.2009) (mere passage of deadline not sufficient to commence legal malpractice accrual absent known harm)