While suing attorneys is certainly a fun activity, it is not without its risks. As we previously noted, it is sometimes better to let sleeping dogs lie. Some people, unfortunately, did not get the message. (Sokol Holdings Inc. et al. v. Dorsey & Whitney LLP)
Sokol was served with a subpoena requiring it to produce documents and to be deposed in a matter in which it wasn’t even a party. It retained Dorsey & Whitney to represent it in this matter. Over time, Sokol ran up a bill for more than $4M (yep, FOUR MILLION BUCKS) in a matter in which IT WASN’T A PARTY. Eventually, Sokol stopped paying their legal bills – here is where they really started going wrong – and sued Dorsey & Whitney, in the Delaware Court of Chancery, claiming that the fees were excessive and not due and owing. Dorsey & Whitney, not surprisingly, counterclaimed for payment of the balance due.
Apparently having second thoughts about their choice of courts, Sokol then raised, but declined to argue, the issue that the court WHICH IT HAD SELECTED lacked subject matter jurisdiction. The Court of Chancery, seized upon this opportunity to rid itself of these wackos (legal term meaning “crazy, pains in the butt”) and agreed, allowing Sokol to refile its complaint in the Superior Court.
After refiling, Sokol made a motion to add a claim for legal malpractice, something it had initially sought to do in the Court of Chancery, but then had withdrawn. The Superior Court rejected the malpractice claim, noting that Sokol’s previous withdrawal of this claim was “most likely in an effort to manipulate the jurisdiction of the Court of Chancery. That deliberate delay is fatal to their motion for leave to amend.”
So, the case will go forward only as to the collection matter. Will Dorsey & Whitney be ordered to refund some of its fees to Sokol; or will Sokol be ordered to pay the claimed unpaid amount to Dorsey & Whitney? The case will be tried by the same judge who decided that Sokol had wasted the court’s time trying to game the system with respect to jurisdiction. Hmmmm.
THE LESSONS TO BE LEARNED: We repeat, (1) sometimes it’s better to let sleeping dogs lie; (2) don’t try to game the system; and (3) DON’T PISS OFF THE JUDGE.