Long v. Parry
679 F. App'x 60
| 2d Cir. | 2017Background
- Raymond A. Long sued his former attorney, Lloyd Parry (and firm), alleging legal malpractice for how Parry handled Long’s suit against Northwestern Medical Center (NMC), which had asserted state-law and federal antitrust claims and sought $40 million.
- The underlying NMC case settled for $4 million. Long claimed Parry’s negligence (e.g., failure to retain infectious-disease and antitrust experts) caused a lower settlement than he would otherwise have obtained.
- District court granted summary judgment to Parry and the firm, concluding Long failed to prove he suffered ascertainable damages from any malpractice and that many underlying claims were meritless (including because Long had voluntarily resigned and defendants had HCQIA immunity).
- Long appealed, challenging: the legal standard applied for damages (case-within-a-case); the district court’s merits conclusions (voluntary resignation, HCQIA immunity, aggregate recoverable damages); denial of leave to amend to add fraud; and a sealing/destruction order for confidential documents.
- The Second Circuit affirmed, applying de novo review for summary judgment and for futility-based denials of amendment, and declined to consider arguments not raised below about destruction of documents.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Standard for negligent-settlement damages / proof of injury | Long argued the district court applied an incorrect or too-rigid standard and that uncertainty in the amount should not defeat his claim | Parry argued Long bears the burden to prove actual damages (difference between actual and proper settlement) and failed to present non-speculative evidence | Court held Vermont malpractice law requires proof of actual damages; Long failed to show non-speculative injury, so summary judgment proper |
| Case-within-a-case merits (voluntary resignation and HCQIA immunity) | Long contended underlying claims could have produced >$4M and were meritorious if fully developed | Parry argued many claims were meritless given Long’s voluntary resignation and defendants’ HCQIA immunity, limiting recoverable damages | Court agreed with district court: voluntary resignation and HCQIA immunity undermined many claims; remaining claims lacked evidentiary support to show >$4M recovery |
| Destruction/sealing of confidential documents | Long challenged the order requiring destruction/return of confidential documents | Parry noted Long had consented to exclusion and did not challenge the destruction order below | Court declined to consider on appeal because issue was forfeited for not being raised below |
| Denial of leave to amend to add fraud claim | Long sought to add fraud allegations based on asserted misrepresentation of Parry’s loyalties | Parry argued amendment was futile and lacked factual specificity required under Rule 12(b)(6) standards | Court held amendment would be futile: proposed fraud allegations were conclusory and failed to plead the required elements plausibly |
Key Cases Cited
- Townsend v. Benjamin Enters., Inc., 679 F.3d 41 (2d Cir.) (summary judgment review standard)
- Loreley Fin. (Jersey) No. 3 Ltd. v. Wells Fargo Sec., LLC, 797 F.3d 160 (2d Cir.) (standard for leave to amend and appellate review of futility)
- Hutchison v. Deutsche Bank Sec. Inc., 647 F.3d 479 (2d Cir.) (de novo review where denial of amendment rests on legal interpretation)
- Vincent v. DeVries, 193 Vt. 574 (Vt.) (Vermont measure of negligent-settlement damages)
- Bourne v. Lajoie, 149 Vt. 45 (Vt.) (dismissing malpractice claim for speculative damages)
- Cannata v. Wiener, 173 Vt. 528 (Vt.) (plaintiff must present sufficient evidence of harm from malpractice)
- United States ex rel. Ladas v. Exelis, Inc., 824 F.3d 16 (2d Cir.) (factors for denying leave to amend)
- Dougherty v. Town of N. Hempstead Bd. of Zoning Appeals, 282 F.3d 83 (2d Cir.) (futility = inability to survive Rule 12(b)(6))
- Ashcroft v. Iqbal, 556 U.S. 662 (U.S.) (plausibility pleading standard)
- Spool v. World Child Int’l Adoption Agency, 520 F.3d 178 (2d Cir.) (conclusory allegations insufficient)
- Krys v. Pigott, 749 F.3d 117 (2d Cir.) (conclusory allegations and pleading standards)
- Davis v. Shah, 821 F.3d 231 (2d Cir.) (appellate forfeiture principle)