Dixon Ticonderoga Co. v. Estate of O'Connor ( 2001 )


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  •                                                                                                                            Opinions of the United
    2001 Decisions                                                                                                             States Court of Appeals
    for the Third Circuit
    4-23-2001
    Dixon Ticonderoga Co v. Estate of O'Connor
    Precedential or Non-Precedential:
    Docket 99-6056
    Follow this and additional works at: http://digitalcommons.law.villanova.edu/thirdcircuit_2001
    Recommended Citation
    "Dixon Ticonderoga Co v. Estate of O'Connor" (2001). 2001 Decisions. Paper 88.
    http://digitalcommons.law.villanova.edu/thirdcircuit_2001/88
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    Filed April 23, 2001
    UNITED STATES COURT OF APPEALS
    FOR THE THIRD CIRCUIT
    No. 99-6054, 99-6055, 99-6056
    DIXON TICONDEROGA COMPANY,
    Appellant in No. 99-6054
    v.
    ESTATE OF WILLIAM F. O'CONNOR; SCHUMANN
    HESSION KENNELLY & DORMENT; SCHUMANN HANLON
    & PANEPINTO; HAROLD FRIEDMAN; KIRSTEN, SIMON,
    FRIEDMAN, ALLEN, CHERIN & LUTKIN; GREENBERG
    MARGOLIS; FRANZBLAU DRATCH & FRIEDMAN;
    STRYKER TAMS & DILL; SCHUMANN HANLON
    O'CONNOR & MCCROSSIN
    HAROLD FRIEDMAN; STRYKER TAMS & DILL,
    Third-Party Plaintiffs
    v.
    DECOTIIS, FITZPATRICK & GLUCK; CONNOLL Y EPSTEIN
    CHICCO FOXMAN ENGELMYER & EWING; STEVEN J.
    ENGELMYER; LISA E. BRODY,
    Third-Party Defendants
    HAROLD FRIEDMAN, Appellant in No. 99-6055
    FRANZBLAU DRATCH, F/K/A GREENBERG MARGOLIS,
    Appellant in No. 99-6056
    On Appeal From the United States District Court
    For the District of New Jersey
    (D.C. No. 96-cv-00810)
    District Judge: Honorable Katharine S. Hayden
    Argued: February 6, 2001
    Before: BECKER, Chief Judge, AMBRO and STAPLETON,
    Circuit Judges.
    (Filed: April 23, 2001)
    STEVEN J. ENGELMYER, ESQUIRE
    (ARGUED)
    LISA E. BRODY, ESQUIRE
    HEATHER R. WEISS, ESQUIRE
    Kleinbard, Bell & Brecker, LLP
    1900 Market Street, Suite 700
    Philadelphia, PA 19103
    Counsel for Dixon Ticonderoga
    ANDREW M. EPSTEIN, ESQUIRE
    (ARGUED)
    Lampf, Lipkind, Prupis & Petigrow
    80 Main Street
    West Orange, NJ 07052
    Counsel for Harold Friedman
    RICHARD T. GAROFALO, ESQUIRE
    (ARGUED)
    THOMAS D. FLINN, ESQUIRE
    Garrity, Graham, Favetta & Flinn
    One Lackawanna Plaza
    P.O. Box 4205
    Montclair, NJ 07042
    Counsel for Franzblau Dratch
    PETER DeSALVO, JR., ESQUIRE
    (ARGUED)
    Soriano, Henkel, Salerno, Biehl &
    Matthews
    75 Eisenhower Parkway
    Roseland, NJ 07068
    Counsel for Estate of William F.
    O'Connor; Schumann Hession
    Kennelly & Dorment; Schumann
    Hanlon & Panepinto; Schumann
    Hanlon O'Connor and McCrossin
    2
    OPINION OF THE COURT
    BECKER, Chief Judge.
    These are consolidated appeals from the grant of
    summary judgment in favor of the defendants in a two-
    tiered legal malpractice action governed by New Jersey law.
    The seeds of this case were sown in the early 1980s when
    Plaintiff Dixon Ticonderoga Company (Dixon) sold a piece of
    industrial property to a company named the Dixon Venture
    (Venture). Defendant William O'Connor--who was affiliated
    with Defendant Schumann Hanlon & Panepinto (the
    Schumann firm)--represented Dixon in connection with the
    sale. Between the time Dixon agreed to sell the property to
    Venture and the time the sale closed, the New Jersey
    Legislature enacted the Environmental Cleanup
    Responsibility Act (ECRA), which imposed substantial new
    clean-up responsibilities on owners of industrial property
    that wished to sell their land.
    In the first tier of this action, Dixon char ges that
    O'Connor committed malpractice by failing to advise it
    about ECRA, and submits that his failure r esulted in its
    transaction with Venture being subject to ECRA. Dixon did
    not comply with ECRA prior to transferring ownership of
    the property to Venture, and V enture sued Dixon to recover
    clean-up costs that it was forced to incur in connection
    with the sale. Though a trial court originally dismissed
    Venture's suit, the appellate courts r einstated it, and
    Venture ultimately obtained a substantial judgment against
    Dixon. Dixon claims that this judgment was the dir ect
    result of O'Connor's negligence.
    The second tier of this case involves Dixon's legal
    malpractice claims against Defendant Harold Friedman,
    who during all relevant times was affiliated with Defendant
    Franzblau Dratch. Friedman represented Dixon during
    much of the litigation brought against it by V enture. In
    1989, Friedman spoke with Dixon's outside counsel about
    the possibility of suing O'Connor for malpractice. Dixon
    submits that this conversation created an attor ney-client
    relationship between it and Friedman with r espect to a
    3
    potential malpractice claim against O'Connor , and alleges
    that Friedman breached his professional duties to it by
    allowing that claim to become time-barred.
    Dixon filed the instant suit against O'Connor , the
    Schumann firm, Friedman, and Franzblau Dratch in 1996.
    Soon thereafter, O'Connor and the Schumann firm moved
    to have the claims against them dismissed pursuant to
    Federal Rule of Civil Procedure 12(b)(6) as time-barred.
    Though Friedman and Franzblau Dratch opposed this
    motion, it was granted by the District Court. Friedman and
    Franzblau Dratch appeal from this aspect of the District
    Court's judgment. Later, the District Court granted
    summary judgment in favor of Friedman and Franzblau
    Dratch. The court held that, even assuming that he created
    an attorney-client relationship between himself and Dixon
    with respect to a potential malpractice action against
    O'Connor, Friedman had breached no pr ofessional duty
    that he owed to Dixon. Dixon appeals from this portion of
    the judgment.
    To resolve both tiers of this appeal we must first decide
    when Dixon gained and lost the right to sue O'Connor for
    malpractice. Under New Jersey law, the time for bringing a
    legal malpractice claim expires six years after the claim
    accrued. As we will explain, accrual occurs when a
    prospective plaintiff gains knowledge of two elements: (1)
    that his or her lawyer has been at fault; and (2) that he or
    she has been injured due to the lawyer's err or. Because
    O'Connor's alleged fault in this case lies in his failure to
    inform Dixon about ECRA prior to the closing of the
    Venture deal, we conclude that the first element was
    satisfied in either late 1984 or early 1985, when Dixon
    learned that ECRA had applied to the transaction. We
    further determine that Dixon was damaged by O'Connor's
    purported error by October 21, 1985, when Dixon incurred
    attorneys' fees in responding to V enture's demands that it
    comply with ECRA.
    In so concluding, we reject several arguments offered by
    Friedman and Franzblau Dratch in favor of a later accrual
    date. Friedman submits that the limitations period did not
    commence until the New Jersey appellate courts first
    issued a ruling adverse to Dixon in the suit br ought against
    4
    Dixon by Venture. We disagr ee, both because the Supreme
    Court of New Jersey has rejected per se rules in this
    context, and because we believe that the necessary
    prerequisites for accrual were satisfied long before that
    time. Franzblau Dratch submits that the statute did not
    begin to run until Venture first sued Dixon, and that the
    limitations period was tolled between the time that the trial
    court threw out the Venture litigation and the time that the
    appellate courts reinstated it. Based on these premises,
    Franzblau Dratch contends that the statute of limitations
    did not run on Dixon's claim against O'Connor until after
    Friedman left Franzblau Dratch, and it submits that it
    cannot be held liable as a result. We r eject this submission
    because: (1) it is ultimately irrelevant due to our
    disagreement with Franzblau Dratch as to when Dixon's
    claim against O'Connor accrued; (2) the tolling ar gument
    rests on a mistaken view of what O'Connor is alleged to
    have done wrong; and (3) the tolling ar gument is
    inconsistent with the policies behind New Jersey's statute
    of limitations and is unsupported by any relevant New
    Jersey case law. We therefore hold that Dixon's claims
    against O'Connor and the Schumann firm accrued by
    October 21, 1985 and that the limitations period on those
    claims ran by October 21, 1991. Because the instant suit
    was not filed until 1996, we will affirm the portion of the
    District Court's judgment that dismissed the claims against
    O'Connor and the Schumann firm.
    We will, however, reverse the portion of the District
    Court's judgment that granted summary judgment in favor
    of Friedman and Franzblau Dratch because we conclude
    that there are genuine issues of material fact that preclude
    us from determining whether the 1989 conversation
    between Friedman and Dixon's outside counsel cr eated an
    attorney-client relationship with r egard to a potential
    malpractice action against O'Connor, and, assuming that it
    did, whether Friedman committed malpractice. Accor ding to
    the Restatement of Law Governing Lawyers, whose
    standards the parties agree govern this case, an attorney-
    client relationship is created with r espect to a given matter
    when: (1) a person informs a lawyer that he or she wants
    the lawyer to provide legal services with r espect to a given
    matter; (2) the lawyer does not refuse; and (3) the lawyer
    5
    knows or should know that the person reasonably relies on
    the lawyer to provide such services.
    The existence of the first factor is essentially conceded.
    We conclude that there is a genuine issue of fact going to
    the second element, because our review of the r elevant
    deposition transcripts indicates that there is at least a
    conflict as to whether Friedman ever refused to undertake
    the representation. Finally, there is a genuine issue as to
    whether the third factor is satisfied because: (1) Friedman
    and Dixon had a preexisting (and ongoing) r elationship
    involving a related matter; (2) Friedman admitted that he
    gave Dixon legal advice about suing O'Connor in 1989; and
    (3) a reasonable reading of the deposition transcripts
    supports an inference that during the 1989 conversation
    Friedman promised to discuss the matter with Dixon again
    at a later date. Although two letters that Dixon's outside
    counsel wrote to Friedman in 1992 could be r ead as
    suggesting that Dixon was not relying on Friedman to
    provide it with legal advice regar ding a malpractice action
    against O'Connor, we do not believe that they so establish
    as a matter of law.
    If the 1989 conversation created an attor ney-client
    relationship, we also believe that ther e is a genuine dispute
    as to whether Friedman committed malpractice. A lawyer
    who assumes a representation must exer cise reasonable
    and ordinary care over the matters entrusted to him or her.
    Because the undisputed evidence establishes that
    Friedman did nothing at all between the 1989 conversation
    and the running of the statute of limitations in 1991, we
    conclude that there is a genuine issue as to whether he
    breached a professional duty that he owed to Dixon.
    I.
    A.
    As generations of children and standardized test-takers
    know, Dixon makes pencils.1 For over a hundred years, it
    _________________________________________________________________
    1. Appellant Dixon Ticonderoga Company was created by a September
    1983 merger of the Bryn Mawr Corporation and the Joseph Dixon
    Crucible Company.
    6
    owned a 36-building industrial facility in Jersey City, New
    Jersey (the Jersey City property). The events underlying
    this appeal began to take shape in 1982 when Dixon
    decided to sell the Jersey City property, and r etained
    attorney O'Connor to advise it regar ding the sale.
    On April 28, 1983, Dixon agreed to sell the Jersey City
    property to Morris Industrial Builders, which immediately
    assigned its rights to Venture. Under the contract, Venture
    was to lease several of the buildings back to Dixon for a
    period of two years following the sale; we will r efer to this
    as the "lease-back." The contract also contained an "as is"
    clause, stating that Venture was acquiring the property
    "without any representations as to[the] character or quality
    [of the property] except as expressly provided herein."
    Closing was made contingent upon Ventur e's obtaining a
    zoning variance; the contract provided that closing would
    occur within 60 days of it doing so.
    Though the variance seems to have been obtained on
    October 12, 1983, the sale was not closed within 60 days
    of that time. Instead, on October 31, a lawyer for V enture
    wrote to O'Connor in his capacity as Dixon's counsel. The
    letter represented (falsely, it seems) that the variance had
    not yet gone through, and purported to extend the time for
    closing as provided in the contract. O'Connor did not
    question the basis for the extension, nor did he pr ess for an
    immediate closing. On January 27, 1984, however ,
    O'Connor wrote to Venture, noting that the contractually-
    required conditions had occurred and accusing Venture of
    "delaying this closing for reasons which ar e not the concern
    of Dixon." O'Connor sent another letter on February 7,
    fixing February 24 as the "time of the essence" date for the
    closing. The transaction eventually closed on that date.
    Unbeknownst to Dixon and Venture, a significant
    development had occurred between the time they entered
    into the contract on April 28, 1983 and the time the deal
    closed on February 24, 1984. In September 1983, the New
    Jersey Legislature enacted ECRA, which imposed
    significant new clean-up responsibilities on owners of
    industrial facilities that wished to transfer their property.2
    _________________________________________________________________
    2. In 1993, ECRA was renamed the "Industrial Site Recovery Act." See
    N.J. Stat. Ann. S 13:1K-6.
    7
    The new rules, however, were made applicable only to
    transfers occurring after December 31, 1983. See N.J. Stat.
    Ann. S 13:1K-6 (Historical & Statutory Notes; Effective
    Date). Though "[t]he passage of ECRA was no secret to the
    legal community," neither O'Connor nor counsel for
    Venture advised either party about ECRA prior to the
    closing. As a result, the parties made no ef fort to close
    before the statute's effective date or to deal with its
    requirements in their agreement. Dixon did not clean up
    the Jersey City property as requir ed by ECRA before
    transferring ownership to Venture. Repr esentatives of both
    Dixon and Venture have subsequently stated that they
    would have attempted to structure their transaction to
    avoid ECRA applicability had they known about the statute.
    Although neither Dixon nor Venture was aware of ECRA
    when they closed, Dixon soon realized its mistake. Dixon's
    sale of the Jersey City property had been part of a
    corporate-wide process of moving its operations to Florida.
    This process also included the selling of its corporate
    headquarters, which at that time was also located in Jersey
    City. Dixon retained Friedman to assist in this latter sale,
    which included getting a letter from New Jersey's
    Department of Environmental Protection stating that the
    transaction did not implicate ECRA. In the course of
    carrying out these responsibilities, Friedman became aware
    of Dixon's sale of its Jersey City property, and realized that
    the closing date had rendered that transaction subject to
    ECRA. Sometime in either late 1984 or early 1985,
    Friedman spoke with the man who had served as Dixon's
    chief negotiator in the sale of the Jersey City pr operty, and
    informed him that ECRA had applied to that sale.
    Venture also realized that the closing date on the sale of
    the Jersey City property had render ed the transaction
    subject to ECRA. On July 15, 1985, it sent a letter
    demanding that Dixon comply with ECRA in connection
    with the impending termination of the lease-back. On
    October 9, 1985, Venture again wr ote to Dixon, noting that
    the sale's closing date had rendered it subject to ECRA. The
    second letter was addressed to Friedman as Dixon's
    counsel, and Friedman directed an associate to draft a
    response on behalf of Dixon. Friedman's fir m sent a letter
    8
    to Venture on October 21, 1985. Friedman stated that he
    assumed that he billed Dixon for these services.
    Venture was eventually forced to engage in an extensive
    environmental clean-up of the Jersey City pr operty, and on
    May 27, 1986 it sued Dixon in the Superior Court of New
    Jersey to recover those costs. We will r efer to this as the
    "Venture litigation" (or "action" or "suit"). Venture raised
    claims under ECRA and another New Jersey envir onmental
    statute, as well as various common law theories. Though
    Friedman did not originally represent Dixon in the Venture
    action, he was retained to do so in November 1987. The
    Superior Court granted summary judgment in favor of
    Dixon on February 18, 1988, holding, inter alia , that the
    sole remedy for a non-conforming sale under ECRA was
    rescission and recovery of affiliated costs. This decision,
    however, was reversed by the Appellate Division, which on
    July 21, 1989 held that ECRA permits a transferee (like
    Venture) to sue a transferor (like Dixon) for damages arising
    from a non-conforming sale. See Dixon Venture v. Joseph
    Dixon Crucible Co., 
    561 A.2d 663
    (N.J. App. Div. 1989).
    Dixon appealed.
    Shortly after the Appellate Division decision in 1989,
    Friedman spoke with Dixon's outside counsel, Richar d
    Joyce. At that time, Joyce raised the possibility of suing
    O'Connor for malpractice, based on the latter's failure to
    advise Dixon about ECRA prior to the sale of the Jersey
    City property. In their depositions, Friedman and Joyce
    offered largely consistent accounts of this conversation, but
    there were also some discrepancies. Both agreed that
    Friedman told Joyce that he doubted that a claim against
    O'Connor would have merit, and Friedman admitted that
    this "probably" constituted "advice to a client." Both were
    also in accord that during the 1989 conversation Friedman
    advised Joyce that it might be tactically unwise to sue
    O'Connor. Because the Venture action appeared headed to
    trial and because O'Connor had represented Dixon in the
    underlying transaction, Friedman counseled Joyce that it
    might "be helpful to have Mr. O'Connor or some of his firm
    available [to assist in that matter] because we weren't quite
    sure what all the issues would be, and maybe[knowing]
    what went on at the beginning would be helpful."
    9
    The record is also clear that in 1989 Friedman expressed
    a certain amount of professional reluctance about suing
    O'Connor. Friedman recalled telling Joyce that: "I don't like
    to handle claims against lawyers, and I'm not sur e that this
    one has any real foundation, and I'm certainly not going to
    handle a claim that I don't think has a foundation." Joyce
    concedes that Friedman never told him that he would
    handle a malpractice claim against O'Connor, and that
    Friedman explained that such claims were "not within his
    area of expertise." Joyce was unequivocal, however, that
    Friedman never expressly refused to handle such a claim.
    There is also some disagreement between Friedman and
    Joyce as to how they ended the 1989 conversation.
    Friedman testified that they left it by concluding that "we
    don't have to make that decision [i.e., whether to sue
    O'Connor] now, we are going to forge ahead with the
    petition for certification and hopefully get the Supreme
    Court to do something about" the Appellate Division
    decision that had reinstated the Ventur e suit. Joyce's
    deposition testimony is murky, but according to the reading
    most favorable to Dixon (which we must adopt due the
    procedural posture of this case) Friedman ended the
    conversation by telling Joyce: "I don't handle[malpractice
    cases] personally, but I'll check with my fir m. Maybe they
    do, and, if not, I've got others who can."3 Friedman
    admitted that he probably billed Dixon for this
    conversation. He also conceded that he took no action with
    respect to a potential malpractice claim against O'Connor
    between 1989 and 1992, i.e., he never resear ched the legal
    issues, investigated the underlying facts, or attempted to
    find another lawyer for Dixon.
    Dixon's hopes that the Supreme Court of New Jersey
    would reverse the Appellate Division's decision were dashed
    on January 30, 1991, when the Supreme Court affirmed
    _________________________________________________________________
    3. Joyce was unequivocal that Friedman made a statement to this effect
    in 1992. But the transcripts can also be read to say that Friedman made
    such a statement in 1989. Because this case is at the summary
    judgment stage and because it is the non-movant, Dixon is entitled to
    have all ambiguities resolved in its favor . See infra Part II.
    Accordingly,
    we will read Joyce's testimony as declaring that Friedman also made
    such a statement in 1989.
    10
    the Appellate Division's judgment. See Dixon V enture v.
    Joseph Dixon Crucible Co., 
    584 A.2d 797
    (N.J. 1991). The
    Supreme Court remanded the case to the Superior Court
    for trial, see 
    id. at 800,
    where Dixon was held liable to
    Venture for over $3 million, of which just under $1.5
    million were awarded as damages on the ECRA claim.
    Friedman and Joyce next spoke about suing O'Connor in
    the spring of 1992.4 Joyce told Friedman that "it would
    seem that we had a malpractice action against the prior
    firm, that it seemed--just looking at it, it would seem that
    we had some relief in attempting to make the company
    whole, that is it something we should consider ." Joyce
    claims that Friedman then told him that "he did not
    personally handle malpractice cases, that he was not sure
    if it was something that his firm would do, something he
    could look into, but that he also was aware of attorneys in
    and around the area who could handle it for us." Joyce
    admitted that Friedman expressed "a pr ofessional
    reluctance to ever have to do something like that to, you
    know, another attorney."
    After this conversation, Joyce stated that he was"under
    the impression that [Friedman] was moving forward with
    either determining whether or not his fir m would handle it
    or he would engage someone on our behalf to make us
    whole," but admitted that he had not given Friedman the
    authority to hire counsel on Dixon's behalf, and was simply
    "waiting for Mr. Friedman to get back to me to tell me how
    we were going to proceed." Friedman r ecalled the 1992
    conversation somewhat differently. He claimed to have told
    Joyce that "I really did not want to pursue a claim [against
    O'Connor], that if he wanted, he could." Friedman stated
    that he did not recall how he and Joyce had left that
    conversation, but he was clear that he did not understand
    Joyce to have told him to pursue a claim against O'Connor,
    and that he would not have done so had he been asked.
    On August 19, 1992, Joyce sent Friedman a letter whose
    caption stated that it was about "Dixon V enture v. Dixon
    Ticonderoga." Joyce wrote that"it would seem the following
    _________________________________________________________________
    4. We have omitted details of this conversation that are irrelevant to our
    disposition.
    11
    strategic moves would be in order." One such "move" was
    suing O'Connor:
    As distasteful as it is for me professionally, it would
    seem that our attorney at the time of closing should
    have known of the ECRA requirements and, therefore,
    a malpractice action should be initiated -- hopefully,
    by your firm.
    (emphasis added). Friedman did not respond.
    On November 25, 1992, Joyce wrote Friedman another
    letter with the same caption. In addition to discussing the
    Venture suit, Joyce stated:
    [I]t is clear to me that we were ill-advised by counsel at
    the time of the closing as to our potential ECRA
    responsibility. It has come to my attention, however,
    that there may be stringent statutory time limitations
    on advising counsel of his screw-up. Considering the
    obvious malpractice in this case, I certainly hope we
    are not constrained by a technicality. I'm sur e you
    would agree that we must proceed immediately.
    Joyce also referred Friedman to a lawfirm that Dixon had
    used "for environmental matters." At the close of the letter,
    Joyce wrote: "I should also point out that[this] firm does
    handle malpractice (the scum) and insurance work and, if
    your firm does not, please feel free to discuss these issues
    also."
    B.
    Having retained other counsel, Dixon commenced this
    legal malpractice action in the United States District Court
    for the District of New Jersey in March of 1996. The
    Complaint named six defendants: the estate of W illiam
    O'Connor;5 O'Connor's former law firm, the Schumann firm;
    Friedman; Franzblau Dratch, the law firm with which
    Friedman had been affiliated during many of the events
    underlying Dixon's claim against him; and two other law
    firms with which Friedman had been associated at various
    _________________________________________________________________
    5. O'Connor died in 1992. We will r efer to his estate as "O'Connor"
    during the remainder of this opinion.
    12
    times. Friedman's Answer raised cross-claims against two
    other law firms and two other attorneys, and both
    Friedman and Franzblau Dratch pled rights of
    indemnification and contribution against various other
    parties. The case was assigned to Judge William G. Bassler.
    Rather than answer, O'Connor and the Schumannfirm
    filed a motion pursuant to Federal Rule of Civil Procedure
    12(b)(6) seeking to have the claims against them dismissed
    as time-barred. Dixon did not oppose the motion, but
    Friedman and Franzblau Dratch did. The District Court
    eventually granted the motion. Further motion practice
    resulted in the uncontested dismissal of the claims against
    all defendants and third-party defendants except Friedman
    and Franzblau Dratch. During this period, the case was
    reassigned to Judge Katherine S. Hayden.
    Dixon, Friedman, and Franzblau Dratch eventually
    moved for summary judgment. On October 16, 1999, Judge
    Hayden rendered an oral ruling stating that she would
    grant summary judgment in favor of Friedman and
    Franzblau Dratch based on her conclusion that, as a
    matter of law, Friedman had not been negligent. Dixon filed
    a timely notice of appeal, reciting that it was appealing only
    the portion of the final order entering summary judgment
    in favor of Friedman and Franzblau Dratch. Friedman and
    Franzblau Dratch filed cross-appeals, contesting only the
    dismissal of the claims against O'Connor and the
    Schumann firm. See also Dixon's Opening Br. at 59 ("[T]his
    Court should reverse the District Court's grant of summary
    judgment in favor of Harold Friedman, Esquir e and
    Franzblau Dratch . . ., and remand this case to the District
    Court for a trial on the merits consistent with this Court's
    opinion.").6
    II.
    This is a diversity case, and, accordingly, Erie Railroad
    Co. v. Tompkins, 
    304 U.S. 64
    (1938), mandates that we
    "apply the substantive law produced by . . . the highest
    _________________________________________________________________
    6. The District Court had subject matter jurisdiction under 28 U.S.C.
    S 1332(a). We have appellate jurisdiction pursuant to 28 U.S.C. S 1291.
    13
    court of the [relevant] state." In re Asbestos Litig., 
    829 F.2d 1233
    , 1237 (3d Cir. 1987). Statutes of limitations are
    substantive for Erie purposes. See Guaranty Trust Co. v.
    York, 
    326 U.S. 99
    , 110 (1945). The parties agree that New
    Jersey law governs the issues of when Dixon's malpractice
    claim against O'Connor accrued and expired, and whether
    there is a genuine issue of material fact as to whether
    Friedman committed malpractice.
    New Jersey law provides that "[i]f an attorney shall
    neglect or mismanage any cause in which he is employed,
    he shall be liable for all damages sustained by his client."
    N.J. Stat. Ann. S 2A:13-4. "A legal-malpractice action
    derives from the tort of negligence." Grunwald v. Bronkesh,
    
    621 A.2d 459
    , 463 (N.J. 1993). Accordingly, a plaintiff must
    prove the traditional elements: the existence of a duty; a
    violation of that duty; and causation of har m. See 
    id. This case
    involves two tiers of malpractice claims: (1) Dixon's
    claims against O'Connor and the Schumann fir m, based on
    the former's failure to advise it about ECRA; and (2) Dixon's
    claim against Friedman and Franzblau Dratch, based on
    Friedman's allowing Dixon's claims against O'Connor and
    the Schumann firm to become time-barr ed.
    We are faced with two issues on appeal. Judge Bassler
    granted the Rule 12(b)(6) motions brought by O'Connor and
    the Schumann firm to dismiss Dixon's claims against them
    as time-barred. Friedman and Franzblau Dratch appeal
    from that ruling. Our standard of r eview is plenary, i.e., de
    novo, see Lake v. Arnold, 232 F .3d 360, 365 (3d Cir. 2000),
    and we consider this issue in Part III. The second issue
    before us is whether Judge Hayden properly granted
    summary judgment in favor of Friedman and Franzblau
    Dratch on the ground that--even assuming that an
    attorney-client relationship arose with respect to a potential
    malpractice action against O'Connor--Friedman br eached
    no professional duty that he owed to Dixon. Summary
    judgment, of course, is appropriate only when"there is no
    genuine issue as to any material fact and . . . the moving
    party is entitled to judgment as a matter of law." Fed. R.
    Civ. P. 56(c). As the nonmoving party, Dixon is entitled to
    have any factual disputes resolved in its favor , and to the
    benefit of all reasonable inferences that can be drawn from
    14
    the facts. See, e.g., Gruenke v. Seip, 225 F .3d 290, 298 (3d
    Cir. 2000).7 We r eview de novo this aspect of the District
    Court's judgment, see, e.g., Watson v. Eastman Kodak Co.,
    
    235 F.3d 851
    , 854 (3d Cir. 2000), and discuss this issue in
    Part IV.
    III.
    We must first consider when Dixon gained and lost the
    right to sue O'Connor. Our resolution of these questions is
    critical for two reasons. First, it will dispose of the cross-
    appeals brought by Friedman and Franzblau Dratch, which
    challenge the District Court's order dismissing the claims
    against O'Connor and the Schumann firm as time-barred.
    Second, our determination of these issues is a necessary
    predicate for resolution of Dixon's appeal of the grant of
    summary judgment in favor of Friedman and Franzblau
    Dratch. The gravamen of Dixon's claim against Friedman
    (and, consequently, against Franzblau Dratch) is that
    Friedman failed to advise it as to when the limitations
    period would run on a legal malpractice action against
    O'Connor. To assess whether ther e is a genuine dispute of
    material fact as to whether Friedman acted negligently, we
    must, therefore, know when the statute ran.
    A.
    Under New Jersey law, legal malpractice claims ar e
    subject to a six year statute of limitations. See N.J. Stat.
    Ann. S 2A:14-1; Grunwald v. Bronkesh, 
    621 A.2d 459
    , 461
    (N.J. 1993). That period begins to run when a claim
    accrues, which is governed by the "discovery rule," which
    operates "to postpone the accrual of a cause of action when
    a plaintiff does not and cannot know the facts that
    constitute an actionable claim." Grunwald, 621 A.2d at
    _________________________________________________________________
    7. Though Dixon also moved for summary judgment on its claims against
    Friedman and Franzblau Dratch, Judge Hayden denied its motion.
    Because Dixon has not appealed this aspect of the District Court's
    judgment, the only question is whether Judge Hayden properly granted
    summary judgment in favor of Friedman and Franzblau Dratch. Dixon is
    the nonmoving party for purposes of that inquiry.
    15
    463. A legal malpractice claim accrues when the client
    gains knowledge of two elements: "fault" and"injury"
    (which is synonymous with "damage"). 
    Id. A prospective
    plaintiff acquires knowledge of an
    attorney's "fault" when he or she r ealizes that the lawyer
    has been negligent, and when he or she knows or should
    know that any harm arising out of a given transaction or
    matter "is attributable to the attorney's negligent advice."
    
    Id. at 466.
    The Supreme Court of New Jersey has eschewed
    laying down bright line rules for determining when this
    requirement is satisfied: A client need not suffer an adverse
    judgment before determining that his or her lawyer has
    committed malpractice, but neither does the existence of
    such a judgment necessarily establish that the client was
    thereinafter charged with such knowledge. See 
    id. Indeed, depending
    on the circumstances, a client may gain
    knowledge of his or her attorney's fault befor e, during, or
    after the resolution of an underlying matter . See 
    id. Damages must
    be "real and substantial as opposed to
    speculative" to start the running of the statute of
    limitations, 
    id. at 465,
    but the Supr eme Court of New
    Jersey has broadly defined the concept of"injury." That
    Court has held that "[i]t is not necessary that all or even
    the greater part of damages have to occur befor e the cause
    of action arises." 
    Id. (quotation marks
    and citations
    omitted). And though "actual damages may exist in the
    form of an adverse judgment," they may also arise, "in the
    form of attorney's fees, before a court has announced its
    decision in the underlying action." 
    Id. B. To
    apply these precepts, we must identify three moments
    in time: the point when Dixon first had reason to believe
    that O'Connor had been negligent; the instant when it was
    first harmed by O'Connor's alleged malpractice; and the
    moment at which Dixon had reason to believe that the
    harms that it had suffered wer e caused by O'Connor's
    supposed errors. We believe that Dixon was on notice that
    O'Connor had been negligent in either late 1984 or early
    1985, when Friedman informed a Dixon r epresentative that
    16
    the Jersey City property's sale date had r endered the
    transaction subject to ECRA--a fact that O'Connor had
    never mentioned.
    It is critical to remember the nature of the malpractice
    with which Dixon charges O'Connor. This is not a case
    where O'Connor gave Dixon bad advice about ECRA; rather,
    the record shows that O'Connor never even mentioned
    ECRA or stated that it might apply to the sale of the Jersey
    City property. As a result, Dixon closed the Venture deal
    without giving any consideration to ECRA. Accor dingly, as
    soon as it learned that the transaction's closing date had
    rendered it subject to ECRA, Dixon had r eason to believe
    that O'Connor had erred by omission.
    We next conclude that Dixon was injur ed by O'Connor's
    alleged malpractice by October 21, 1985--the date by
    which it had incurred an obligation to pay attorneys' fees to
    Friedman's firm in connection with r esponding to Venture's
    ECRA-based demands. Venture lear ned that ECRA had
    applied to the sale of the Jersey City property in the
    summer of 1985, and soon realized that Dixon had not
    complied with the statute's clean-up requir ements. Venture
    sent Dixon letters dated July 15, 1985 and October 9, 1985
    demanding that Dixon comply with ECRA; the latter letter
    specifically noted that the sale's closing date (February 28,
    1984) had triggered ECRA duties. Dixon then r etained
    Friedman's firm to respond to V enture's demands.
    Friedman directed an associate to prepar e a response on
    behalf of Dixon, which was dated October 21, 1985.
    Friedman "assume[d]" that he billed Dixon for these
    services.
    By the time the October 21 letter was sent, O'Connor's
    alleged malpractice had injured Dixon. Had O'Connor done
    his job, Dixon's argument goes, the sale would never have
    been subject to ECRA at all.8 But because O'Connor did not
    _________________________________________________________________
    8. To have avoided ECRA, Dixon and V enture would apparently have had
    to do two things: (1) they would have needed to close prior to December
    31, 1983; and (2) Dixon would have needed to for ego the lease-back.
    Dixon has submitted evidence that these steps could have and would
    have been taken had the parties known about ECRA. Robert Morris, who
    17
    advise Dixon about ECRA prior to the closing, Dixon was
    forced to retain Friedman's firm to respond to Venture's
    demands. Even if it did not tender payment immediately,
    Dixon certainly acquired an obligation to pay Friedman's
    firm by the time the October 21, 1985 letter was mailed.
    And because Grunwald squarely held that incurrence of
    attorney fees can constitute damages for purposes of
    starting the statute of limitations, see Grunwald v.
    _________________________________________________________________
    signed the contract of sale on behalf of Venture, certified that "ECRA's
    applicability . . . could have easily been avoided, if I had been aware of
    ECRA prior to closing." Specifically, Morris stated that he "would have
    tendered the purchase price and closed . .. prior to December 31, 1984,"
    and represented that he "had the necessary financing in place to do so."
    Morris also claimed that he "would have for egone the lease-back to
    Dixon," and that he "would have done so in exchange for a reduction in
    the purchase price equal to the present value of the stream of
    anticipated profits." Morris submitted that "any reasonable businessman
    would have been able to agree to this or similar terms" and noted that
    his "contract negotiations with Dixon had gone r easonably well, and we
    were able to agree on all other material terms." Gino Pala, who served as
    Dixon's CEO during the relevant time period, testified that Dixon was
    "ready to leave [the Jersey City pr operty] at any time," and that it
    "wanted to get out as soon as possible." David Brewster, who was a
    member of Dixon's board at the time of the sale and later served as its
    CEO, certified that had he been aware "that ECRA liability could [have
    been] avoided by closing the transaction befor e ECRA's effective date,
    [he] would have insisted that the transaction close prior to December 31,
    1983." Brewster stated that he was "not aware of any reason why the
    transaction could not have closed prior to December 31, 1983." Brewster
    also represented that he would have agr eed to forego the lease-back
    entirely because "even if that resulted in a reduced purchase price . . .
    [i]t would have been worth losing a few hundr ed thousand dollars in
    order to avoid millions of dollars of ECRA liability." Friedman disputes
    these allegations, averring that the scenario of fered by Dixon is "purely
    speculative and improbable." Friedman assails the credibility of Pala and
    Brewster, contending that what they say now is self-serving and
    inconsistent with statements they made earlier . He also avers that it
    would have been against Venture's inter est to structure the transaction
    so as to avoid ECRA. Lastly, Friedman contends that even had ECRA
    been avoided, Venture would have incurr ed other environmental liability
    in connection with the sale, and would have sued Dixon to recover those
    costs. As will appear, see infra note 15, we do not resolve these issues
    here.
    18
    Bronkesh, 
    621 A.2d 459
    , 465 (N.J. 1993), we think that
    Dixon was injured by O'Connor's purported malpractice by
    that time.
    We acknowledge that not every claim made against a
    client--and not every counsel fee expended in defense of
    that claim--triggers the running of the statute of limitations
    for a legal malpractice claim. Accrual does not occur until
    a prospective plaintiff realizes that his or her lawyer has
    been negligent, and that he or she has been har med as a
    result of that negligence. The dispositive question, therefore,
    is when Dixon knew or should have known that any
    damages were attributable to O'Connor's negligent advice.
    See 
    id. at 466.
    We conclude that Dixon had such notice by
    the time the October 21, 1985 letter was sent. By early
    1985 Dixon had reason to believe that any ECRA costs it
    acquired in connection with the Jersey City transaction
    were due to O'Connor's failure to advise it about ECRA
    prior to the closing. And by October 21, 1985, Dixon had
    suffered ECRA-related costs in connection to that sale. We
    believe that Dixon was on notice that O'Connor's alleged
    malpractice may have caused it harm by that date, and
    therefore hold that Dixon's malpractice action against
    O'Connor and the Schumann firm accrued by October 21,
    1985, and, consequently, expired October 21, 1991, six
    years later.
    C.
    We are unpersuaded by the arguments offered by
    Friedman and Franzblau Dratch in support of a later date
    for either accrual of Dixon's claim or the running of the
    statute of limitations.
    1.
    Friedman submits that the limitations period did not
    commence until at least July 21, 1989--the date that the
    Appellate Division reversed the Superior Court's decision
    and reinstated the Venture suit. 9 Friedman's argument is
    _________________________________________________________________
    9. Friedman also argues that the limitations period did not start running
    until January 30, 1991, when the Supreme Court of New Jersey affirmed
    the Appellate Division's order. For the same reasons that we reject his
    submission that Dixon's claims against O'Connor and the Schumann
    firm did not accrue until 1989, we r eject this claim as well.
    19
    largely based on the facts of Grunwald v. Bronkesh, 
    621 A.2d 459
    (N.J. 1993).
    The plaintiff in that case had sued an attor ney who had
    represented him in a real estate transaction. Their
    association began when a third party expr essed interest in
    acquiring an option to buy a property that the plaintiff
    owned in Atlantic City, and the plaintiff r etained the
    defendant lawyer to draw up the relevant documents. The
    lawyer prepared two items: an option agr eement and a
    contract for sale, the latter of which was to be triggered if
    the third party exercised the option. The attorney presented
    both documents to the third party, instructing it to sign the
    option agreement and initial the contract for sale. Instead,
    the third party signed both documents.
    The lawyer advised the plaintiff that by signing the sales
    contract, the third party had assumed an enfor ceable
    obligation to buy the property. Relying on this advice, the
    plaintiff bypassed another opportunity to develop his
    property. The third party, however , never exercised the
    option. Still acting on advice of the defendant lawyer, the
    plaintiff then sued the third party for specific performance
    of the contract for sale. A trial court rejected the plaintiff 's
    claim, holding that the third party never incurred an
    enforceable obligation to buy the property because it never
    intended to do so, and stating that the plaintif f should not
    have relied on his lawyer's advice that a binding contract
    had been created. This decision was later affirmed on
    appeal. The plaintiff then brought a legal malpractice action
    against the defendant lawyer, which the attor ney claimed
    was time-barred.
    The central issue in Grunwald was when the plaintiff 's
    claim against the defendant lawyer accrued: The action was
    timely if accrual did not occur until after the conclusion of
    the appellate process in the plaintiff 's suit against the third
    party, but the claim was untimely if the limitations period
    had started running at or before the time of the trial court's
    initial adverse decision. The Supreme Court of New Jersey
    held that the plaintiff 's claim was time-barred because his
    claim had accrued at the time the trial court r ejected his
    claim against the third party. See Grunwald , 621 A.2d at
    467. The Court determined that the plaintif f had been
    20
    injured when the third party first r efused to exercise its
    option after the plaintiff had bypassed another offer to
    develop the Atlantic City property, and that he had been
    injured again when he incurred litigation costs in his action
    against the third party. See 
    id. And the
    Court held that the
    plaintiff gained knowledge that his injuries were
    attributable to his lawyer's negligence when the trial court
    held that he should not have relied on his lawyer's advice
    that a binding contract for sale had been cr eated between
    the third party and him. See 
    id. Friedman seeks
    to persuade us that, under Grunwald, a
    client never gains knowledge of his or her lawyer's fault
    until a court issues an adverse decision in an underlying
    litigation. He notes that the Grunwald court held that the
    plaintiff gained knowledge of his lawyer's fault when the
    trial court issued its adverse decision and "not when the
    third party took a position contrary to the advice the
    attorney had given, nor when plaintiff brought suit against
    the third party." Drawing an analogy between Grunwald
    and this case, Friedman submits that just as the plaintiff
    in Grunwald had no reason to feel that he was the victim
    of malpractice merely because the third party disagreed
    with his lawyer's interpretation of the thir d party's signing
    the contract for sale, Dixon had no reason to feel aggrieved
    by O'Connor's actions simply because Ventur e sought to
    impose "a novel legal liability upon Dixon--one not
    specifically set forth in the ECRA statute, and one which
    had not been the subject of any prior judicial
    determination." And, Friedman opines, because there was
    no adverse decision against Dixon in the underlying
    litigation until the Appellate Division reinstated Venture's
    ECRA suit on July 21, 1989, Dixon had no reason to
    believe that O'Connor had committed malpractice prior to
    that date.
    We disagree. The bright-line rule Friedman seeks is
    inconsistent with Grunwald's clear statement that
    "knowledge of fault may occur before . . . a judicial
    resolution of the underlying 
    action." 621 A.2d at 466
    . The
    ultimate, case-specific question is "when a plaintiff knows
    or should know that the damage is attributable to the
    attorney's negligent advice." 
    Id. And though
    the plaintiff in
    21
    Grunwald had no reason to believe that his attorney had
    committed malpractice until the first adverse decision in
    the underlying matter, the facts here ar e significantly
    different. The Grunwald opinion contains no evidence that
    anyone (other than, perhaps, the lawyer for the third party)
    told Grunwald that his lawyer may have render ed incorrect
    advice until the trial court did so in rejecting the plaintiff 's
    claim against the third party. Here, in contrast, Friedman
    informed Dixon that ECRA had applied to the sale in either
    late 1984 or early 1985--long before thefirst adverse
    decision. This is not a case where O'Connor gave Dixon
    incorrect counsel about ECRA; indeed, if it was there would
    be a strong argument that Dixon would not have gained
    knowledge of O'Connor's fault until a judicial ruling
    repudiated his advice. Instead, the evidence shows that
    O'Connor failed even to mention ECRA to Dixon prior to the
    closing. Under these circumstances, Dixon should have
    realized that O'Connor had made a mistake as soon as it
    learned that ECRA had applied to the sale.
    2.
    Franzblau Dratch presses a more elaborate argument. It
    first suggests that Dixon's claim against O'Connor accrued
    on May 27, 1986--the day Venture filed suit against Dixon
    seeking recovery for its clean-up costs. If true, then the
    limitations period would ordinarily have expir ed six years
    later on May 27, 1992. But Franzblau Dratch also contends
    that the limitations period was tolled for the 518 days
    between February 18, 1988, when the Superior Court threw
    out the Venture suit, and July 21, 1989, when the
    Appellate Division reinstated it. We will refer to this as the
    "tolling argument." If correct, then Dixon's time to sue
    O'Connor did not expire until October 27, 1993. Franzblau
    Dratch notes that Friedman severed his ties with it during
    the spring of 1993, and submits that it cannot be held
    liable because Friedman left the firm prior to the time that
    Dixon lost the right to sue O'Connor.10 We reject this
    _________________________________________________________________
    10. Friedman and Franzblau Dratch disagree about whether Friedman
    left the firm on May 28, 1993 or June 1, 1993, but that dispute is
    ultimately irrelevant.
    22
    argument because: (1) we disagree with Franzblau Dratch
    as to when Dixon's claim against O'Connor accrued; (2) we
    disagree that the elements of "fault" and"damage" were not
    present between the time the Superior Court dismissed the
    Venture suit and the time the Appellate Division reinstated
    it, and, therefore, that Dixon could not have sued O'Connor
    during that period; and (3) we disagree that New Jersey law
    permits tolling in circumstances such as this one.
    The foundation of Franzblau Dratch's tolling ar gument is
    its premise that Dixon's claim against O'Connor did not
    accrue until Venture sued Dixon. But if we are correct that
    the claim against O'Connor actually accrued by October 21,
    1985, then the tolling argument fails on its own terms. If
    the statute started to run on October 21, 1985, then it
    ordinarily would have expired on October 21, 1991. Even if
    we were to add 518 days to that date, we would conclude
    that the limitations period ran on March 22, 1993--before
    Friedman severed his ties with Franzblau Dratch. 
    See supra
    note 10. Franzblau Dratch's tolling argument thus makes
    no difference unless Dixon's claim accrued on May 27,
    1986.
    Franzblau Dratch's only argument in favor of May 27,
    1986 as the accrual date is its suggestion that this is the
    day "found" by Judge Bassler. This ar gument suffers from
    two problems. First, because Judge Bassler was acting on
    a motion brought pursuant to Federal Rule of Civil
    Procedure 12(b)(6), he made no factualfindings. At all
    events, our standard of review is plenary. See Lake v.
    Arnold, 
    232 F.3d 360
    , 365 (3d Cir . 2000). Second, we
    disagree with Franzblau Dratch's interpr etation of Judge
    Bassler's opinion. Judge Bassler wrote that Dixon "clearly
    had knowledge of a claim for damages [against O'Connor] in
    either 1985 or at the latest, 1986." Judge Bassler also
    noted that Dixon conceded that it had such knowledge by
    1986, and ultimately determined that Dixon"clearly
    received notice of [Venture's claim against it] by May 1986."
    (emphasis added). Because this suit was not filed until
    1996, Judge Bassler's determination that Dixon's claim
    against O'Connor accrued in 1986 was sufficient to decide
    the issue before him: whether the six-year statute of
    limitations had run for purposes of a legal malpractice
    23
    action brought by Dixon against O'Connor's estate and the
    Schumann firm. There was simply no r eason for Judge
    Bassler to decide whether the claim accrued at an earlier
    date, and we believe that his opinion makes clear that he
    did not. We therefore adher e to our conclusion that Dixon's
    claim accrued by October 21, 1985. 
    See supra
    Part III(B).
    Moreover, we disagree with Franzblau Dratch's
    contention that the statute of limitations was ever tolled in
    this case. The firm asserts that the running of the statute
    was tolled because the elements of "fault" and"damage"
    necessary for the accrual of a legal malpractice claim were
    not present between the time the Superior Court dismissed
    the Venture suit and the time the Appellate Division
    reinstated it. During that period, Franzblau Dratch avers,
    Dixon had no reason to believe that O'Connor had been at
    fault or that any negligence on his part had caused it to
    suffer any damages.
    We reject this "fault" argument for the same reason that
    we rejected Friedman's: It rests on a mistaken view of what
    O'Connor is alleged to have done wrong. Franzblau Dratch
    assumes that the Superior Court's initial decision to
    dismiss the Venture suit vindicated O'Connor's actions.
    Although this might be correct had O'Connor advised Dixon
    that ECRA did not create a private right of action for
    damages, that is not what O'Connor did. Instead, Dixon
    charges that O'Connor committed malpractice by failing to
    mention ECRA at all. The Superior Court's initial decision
    that Venture could not recover ECRA-imposed clean-up
    costs from Dixon may have limited the damage done by
    O'Connor's alleged dereliction, but it did nothing to change
    the fact that O'Connor had erred.
    We also disagree with Franzblau Dratch's claim that
    Dixon had sustained no actionable damages between the
    time the Superior Court dismissed the Ventur e suit and the
    time the Appellate Division reinstated it. Dixon incurred
    counsel fees in responding to Ventur e's pre-suit demands
    and in defending the suit prior to the dismissal. Though
    Franzblau Dratch rightly points out that the incurring of
    counsel fees counts as injury for legal malpractice purposes
    only if the client has reason to attribute those fees to his or
    her lawyer's negligence, we conclude that that pr ecept is
    24
    satisfied here. Dixon's claim is that O'Connor failed to
    advise it about ECRA, and that this failure pr evented Dixon
    and Venture from structuring their transaction to avoid the
    statute. Under this scenario, if O'Connor had not been
    negligent, then ECRA would not have applied to the sale. As
    a result, any counsel fees Dixon incurr ed responding to
    Venture's demands after it became appar ent that ECRA had
    applied to the sale were attributable to O'Connor's
    negligence. Though the Superior Court's dismissal of the
    Venture suit may have lessened the extent to which Dixon
    was harmed, it did not change the fact that Dixon was
    forced to spend money defending an ECRA suit that might
    have been avoided entirely had O'Connor not (allegedly)
    committed malpractice. This is enough under New Jersey
    law. See Grunwald v. Bronkesh, 
    621 A.2d 459
    , 465 (N.J.
    1993) (holding that for a legal malpractice claim to accrue,
    a plaintiff need not know the precise extent of his or her
    damages, or even have suffered all of the damages
    attributable to his or her attorney's negligence).
    Finally, Franzblau Dratch's tolling argument is
    fundamentally inconsistent with the policies beyond New
    Jersey's statute of limitations as expressed in Grunwald,
    and it is unsupported by any relevant case law. The
    principal consideration underlying New Jersey's statute of
    limitations is fairness to defendants. See 
    id. The Supreme
    Court of New Jersey has observed that allowing the
    limitations period on a legal malpractice claim to be
    postponed until the appellate process in an underlying
    litigation was complete could leave a lawyer unsur e
    whether he or she will be sued for an extraor dinarily long
    period of time. See 
    id. In addition
    to denying peace of mind
    to lawyers, long delays would also result in trials being
    conducted after memories have faded and evidence has
    been lost. See 
    id. Precisely the
    same could occur under
    Franzblau Dratch's proposed approach wher e the statute
    would be tolled, as a matter of law, during any period
    where the prospective plaintiff appears to have obtained a
    victory in an underlying litigation.1 1
    _________________________________________________________________
    11. Indeed, the facts of this case provide an apt illustration. Dixon
    charges that O'Connor committed malpractice in 1983-84, but this suit
    was not filed until over a decade later. O'Connor died in 1992, and
    counsel for the Schumann firm informed us at oral argument that many
    of his records have been destroyed.
    25
    Franzblau Dratch has pointed to no relevant cases that
    allowed tolling in a situation such as this one. The only
    New Jersey cases it cites are inapposite, because the
    defendants in those cases had received notice of the claims
    against them within the limitations period. See Galligan v.
    Westfield Ctr. Serv., Inc., 
    412 A.2d 122
    , 123 (N.J. 1980)
    (defendant received notice when the plaintif f brought an
    action in federal court); Peloso v. Hartfor d Fire Ins. Co., 
    267 A.2d 498
    , 499-500 (N.J. 1970) (defendant insurance
    company had received notice when the plaintif f submitted
    its request for benefits); Mitzner v. W . Ridgelawn Cemetery,
    Inc., 
    709 A.2d 825
    , 826 (N.J. App. Div. 1998) (defendant
    received notice when the plaintiff br ought an action in New
    York state court, which was ultimately dismissed due to
    lack of personal jurisdiction).
    The principal reason for statutes of limitations is to
    provide notice to defendants, see Grunwald , 621 A.2d at
    465, and tolling the statute in cases where the defendant
    has nevertheless received notice does not under mine this
    policy. Critically different here is that there is no evidence
    that O'Connor ever received notice that Dixon may sue him
    at any time during the limitations period. The only case
    Franzblau Dratch references that allowed tolling in a
    situation such as this one is Pope County v. Friday,
    Eldredge & Clark, 
    852 S.W.2d 114
    (Ark. 1993). In addition
    to not being a New Jersey case, Pope County's holding is
    based on a premise that the Supreme Court of New Jersey
    rejected in Grunwald: that a putative plaintiff has no legal
    malpractice claim until an underlying adverse decision is
    affirmed on appeal because his or her damages are
    speculative until that point. See Pope County , 852 S.W.2d
    at 115 (summarizing the court's prior holding in Stroud v.
    Ryan, 
    763 S.W.2d 76
    (Ark. 1989)). For all of these reasons,
    we reject Franzblau Dratch's tolling ar gument.
    D.
    We conclude that Dixon's malpractice claim against
    O'Connor accrued no later than October 21, 1985 and that
    it expired no later than October 25, 1991. W e therefore hold
    that the District Court did not err in granting the motions
    26
    by O'Connor and the Schumann firm to dismiss the claims
    against them as time-barred.
    IV.
    Having determined when Dixon's malpractice claim
    against O'Connor became time-barred, we tur n to whether
    there is a genuine issue of material fact as to whether
    Friedman committed malpractice. This inquiry
    encompasses two issues: (1) Is there a genuine dispute of
    fact as to whether an attorney-client r elationship arose
    between Friedman and Dixon concerning a potential
    malpractice claim against O'Connor?; and, if so, (2) Is there
    a genuine dispute as to whether Friedman breached any
    professional duty that arose out of that r epresentation?12
    Because we conclude that there are genuinely disputed
    facts going to both issues, we will reverse the District
    Court's grant of summary judgment in favor of Friedman
    and Franzblau Dratch.
    A.
    The threshold question is whether Friedman cr eated an
    attorney-client relationship with Dixon with respect to a
    potential malpractice action against O'Connor in 1989.13
    _________________________________________________________________
    12. The parties have not directed to our attention to any New Jersey case
    expressly holding that the first of these questions is a jury issue, but
    we
    will assume that it is because counsel for both Dixon and Friedman
    agreed on this point at oral argument.
    13. As we 
    noted supra
    at Part I(A), Friedman and Joyce also discussed
    the possibility of suing O'Connor in the spring of 1992. At that time,
    Friedman advised Joyce that it was "clear" that there was no statute of
    limitations problem. This advice was based on the Appellate Division's
    decision in Grunwald v. Bronkesh, 
    604 A.2d 126
    (N.J. App. Div. 1992)
    ("Grunwald I"), which was ultimately overruled by Grunwald v. Bronkesh,
    
    621 A.2d 459
    (N.J. 1993) ("Grunwald II"). The District Court granted
    summary judgment against Dixon in part because it concluded that it
    had been reasonable for Friedman to rely upon Grunwald I at the time
    of the 1992 conversation. Although Dixon assails this ruling by the
    District Court, contending that New Jersey law gover ning the accrual of
    a legal malpractice claim was anything but clear in 1992, we need not
    resolve this dispute. Because we have deter mined that the statute of
    limitations ran on any claim against O'Connor by the fall of 1991,
    anything that Friedman said about such a suit in 1992 is immaterial.
    27
    According to the Restatement of the Law Gover ning
    Lawyers S 26 (Proposed Final Draft No. 1 1996)--which was
    quoted with approval in Herbert v. Haytaian , 
    678 A.2d 1183
    , 1188 (N.J. App. Div. 1996), and which both parties
    agree accurately states New Jersey law--an attorney-client
    relationship is created with respect to a particular matter
    when:
    1) a person manifests to a lawyer the person's intent
    that the lawyer provide legal services to the person;
    and either
    (a) the lawyer manifests to the person consent to do so;
    or
    (b)   the lawyer fails to manifest lack of consent to do so,
    and   the lawyer knows or reasonably should know that
    the   person reasonably relies on the lawyer to provide
    the   services.
    Because there is a genuine issue of material fact as to
    whether an attorney-client relationship was created
    pursuant to S 26(1)(b), we do not addr ess S 26(1)(a).
    The first question is whether Joyce manifested an intent
    that Friedman provide legal services. Friedman has never
    seriously disputed the existence of this factor , and with
    good reason. Joyce (on behalf of Dixon) clearly manifested
    such an intent when, in 1989, he sought Friedman's advice
    about the possibility of suing O'Connor for malpractice.
    Friedman rests primarily on the assertion that he
    "manifest[ed] lack of consent to" advise Dixon, but that
    argument does not carry the day. Accor ding to Friedman's
    deposition, the strongest statement he made in 1989 was:
    "I don't like to handle claims against lawyers, and I'm not
    sure that this one has any real foundation, and I'm
    certainly not going to handle a claim that I don't think has
    a foundation." This statement could be interpr eted in at
    least two ways: Either Friedman was simply infor ming
    Joyce that he would not pursue a malpractice action
    against O'Connor unless he concluded that it had merit, or
    he was refusing to advise Dixon at all. The pr ocedural
    posture of this case mandates that we r esolve ambiguities
    in favor of Dixon, and, as a result, we do not read this
    28
    statement as an affirmative refusal by Friedman. Therefore,
    we cannot say that there is no genuine issue of material
    fact with respect to this factor.
    The final issue in determining whether an attorney-client
    relationship arose between Dixon and Friedman with
    respect to a malpractice action against O'Connor is whether
    Dixon reasonably relied on Friedman to pr ovide such
    services and whether Friedman knew or should have
    known that it was doing so. Though the question is close,
    three things convince us that there is a genuine dispute of
    material fact as to this issue.
    First, at the time of the 1989 conversation, Friedman was
    also representing Dixon in the Venture litigation. The
    Venture suit and the potential malpractice action against
    O'Connor arose out of the same set of historical events:
    Dixon's sale of the Jersey City property to V enture. The fact
    that Dixon was already relying on Friedman for advice and
    representation in a closely related matter supports an
    inference that Dixon expected Friedman to advise it about
    a potential malpractice action against O'Connor and that
    Friedman knew or should have known that fact.
    Second, despite his purported reluctance to do so,
    Friedman admitted that he gave Dixon legal advice about
    suing O'Connor during the 1989 conversation. Friedman
    originally claimed that his 1989 conversation with Joyce
    was not actually about bringing an action against
    O'Connor, but rather was concerned with determining
    whether Friedman was willing to undertake such a
    representation. But when directly asked whether his
    statement to Joyce that he doubted that any claim against
    O'Connor would have merit constituted "advice to a client,"
    Friedman admitted that it "probably" did. The fact that
    Friedman gave such advice on one occasion could support
    an inference that Dixon reasonably expected him to do so
    in the future, and that Friedman knew or should have
    known that Dixon would so rely.
    Finally, though the depositions are unclear as to how
    Joyce and Friedman left their 1989 conversation, we believe
    that the reasonable reading most favorable to Dixon
    supports an inference that Dixon expected Friedman to get
    29
    back to it about a potential malpractice claim against
    O'Connor and that Friedman knew or should have known
    of that expectation. According to Friedman, he told Joyce
    that there was no need to decide whether to sue O'Connor
    at that time because they were going to attempt to convince
    the Supreme Court of New Jersey to throw out the Venture
    suit. This statement, particularly in light of the parties' on-
    going relationship, might reasonably be understood as a
    promise by Friedman to revisit the matter with Joyce once
    the underlying appeal was complete.
    This conclusion is also supported by Joyce's deposition.
    Reading his deposition most favorably to Dixon, see supra
    note 3 and accompanying text, Joyce recalled that
    Friedman told him he did not "handle" malpractice actions
    "personally" but that he would "check with[his] firm" to see
    if another lawyer would, and, if not, he would find another
    lawyer for Dixon. This testimony supports an infer ence
    that, at the very least, Dixon was relying on Friedman to
    find a lawyer to "handle" the malpractice action against
    O'Connor, and that Friedman knew or should have known
    that it was doing so.
    Cutting most strongly against the conclusion that Dixon
    was relying on Friedman to advise it about a malpractice
    action against O'Connor are the letters Joyce wrote to
    Friedman in 1992. In the August 19, 1992 letter Joyce
    wrote that "[a]s distastefully as it is for me professionally,
    it would seem that our attorney at the time of closing [i.e.,
    O'Connor] should have know of the ECRA requirements
    and, therefore, a malpractice action should be initiated --
    hopefully by your firm . . . ." Joyce got no response to this
    letter, and wrote Friedman another dated November 25,
    1992. At the end of this second letter, Joyce informed
    Friedman that he had been speaking with another lawyer
    about the Venture litigation, pr ovided Friedman with that
    lawyer's phone number, and stated that "his firm does a lot
    of malpractice (the scum) and insurance work and, if your
    firm does not, please feel free to discuss these issues also."
    These letters could be understood as indicating that
    Dixon was not relying on Friedman to advise it about a
    malpractice suit against O'Connor because they imply that
    Joyce himself did not believe that Friedman had agr eed to
    30
    advise Dixon in such a suit. This is not the only r eading of
    the evidence, however. First, as pointed out by Dixon at
    oral argument, the fact that Friedman may have
    communicated to Dixon that he would not personally
    litigate a malpractice action against O'Connor would not
    preclude a finding that he agreed to advise Dixon about
    one, and an agreement to give advice is all that is necessary
    to establish an attorney-client relationship. Second, to the
    extent the letters shed light on Dixon's state of mind, they
    do so primarily in terms of what Joyce was thinking in
    1992. The question before us, however, is not whether
    Dixon was relying on Friedman to provide legal advice in
    1992. Rather, it is whether Dixon was so r elying between
    1989 (when the first conversation between Joyce and
    Friedman occurred) and the fall of 1991 (when the statute
    of limitations ran on any claim against O'Connor). The
    relevant time period ended in the fall of 1991, but Joyce's
    letters were not sent until the summer of 1992. In the
    interim, Joyce and Friedman had at least one additional
    conversation about suing O'Connor, and that conversation
    may have changed Joyce's understanding of the state of
    affairs between Friedman and Dixon. Because of this, the
    letters are not dispostive as to Joyce's (and thus Dixon's)
    understanding of the situation between 1989 and 1991.
    We therefore hold that ther e is a genuine issue of
    material fact as to whether Friedman created an attorney-
    client relationship between himself and Dixon in 1989 with
    respect to a potential malpractice claim against O'Connor.
    B.
    The final issue before us--assuming an attorney-client
    relationship existed--is whether ther e is a genuine dispute
    as to whether Friedman breached a professional duty that
    he owed to Dixon. "[L]awyers owe a duty to their clients to
    provide their services with reasonable knowledge, skill, and
    diligence." Ziegelheim v. Apollo, 
    607 A.2d 1298
    , 1303 (N.J.
    1992). But because " `[w]hat constitutes a reasonable degree
    of care is not to be considered in a vacuum but with
    reference to the type of service the attor ney undertakes to
    perform,' " the Supreme Court of New Jersey has
    formulated the standard of care"in rather broad terms." 
    Id. 31 (quoting
    St. Pius X House of Retreats v. Diocese of Camden,
    
    443 A.2d 1052
    (N.J. 1982)); see also Conklin v. Hannoch
    Weisman, 
    678 A.2d 1060
    , 1069 (N.J. 1996) ("Malpractice in
    furnishing legal advice is a function of the specific situation
    and the known predilections of the client.").
    Some general precepts are nevertheless clear. A lawyer
    "must take `any steps necessary in the pr oper handling of
    [a] case,' " and these steps "include, among other things, a
    careful investigation of the facts of the matter, the
    formulation of a legal strategy, the filing of appropriate
    papers, and the maintenance of communication with the
    client." 
    Ziegelheim, 607 A.2d at 1303
    (quoting Passanante v.
    Yormark, 
    350 A.2d 497
    (N.J. App. Div. 1975)). A lawyer is
    also "obligated to keep the client informed of the status of
    the matter for which the lawyer has been retained, and is
    required to advise the client on the various legal and
    strategic issues that arise." 
    Id. 1. The
    District Court granted summary judgment against
    Dixon partly because it read the recor d as saying that
    during the 1989 conversation Friedman told Joyce that
    Dixon need not decide whether to sue O'Connor at that
    time "because there was no imminent statute of limitations
    problem." Even if Dixon was ultimately corr ect that its
    claim against O'Connor accrued in the fall of 1985 and
    expired in the fall of 1991 (and we have deter mined that it
    was), the District Court stressed that Dixon still had over
    two years to sue O'Connor at the time of the 1989
    conversation, which occurred during the summer of that
    year. Accordingly, to the extent that Friedman counseled
    Dixon that there was no "imminent" statute of limitations
    problem in the summer of 1989, his advice was sound. And
    because the advice was correct when given, the District
    Court reasoned that it was non-actionable "due to the legal
    principle that [a] plaintiff suf fers no damage as a result of
    receiving correct advice."
    To the extent that the District Court concluded that
    Friedman's actions in 1989 alone would not support
    malpractice liability, we have no quarrel with its analysis.
    32
    Disagreeing, Dixon infers from the court's holding that it
    relied on the "judgmental immunity defense" recognized in
    Procanik v. Cillo, 
    543 A.2d 985
    (N.J. App. Div. 1988).
    Acknowledging that law is not always static and
    predictable, Procanik shields fr om malpractice liability
    lawyers who offer a "reasoned pr ofessional evaluation"
    based on the "exercise of an informed judgment"--even if
    their advice later turns out to have been incorrect. 
    Id. at 994.
    Because Friedman admits that he did no r esearch
    regarding the statute of limitations in 1989, Dixon contends
    that Friedman is ineligible for this defense. Though Dixon's
    argument on this point is sound, it is also irrelevant. What
    it misses is that "advice" that the District Court understood
    Friedman as having given Dixon in 1989, i.e., that there
    was no "imminent" statute of limitations pr oblem, was
    accurate. And, like the District Court, we fail to see how
    receiving correct legal advice could ever cause harm to a
    client.
    2.
    Dixon's primary contention, however, is not that
    Friedman committed malpractice by giving it incorr ect
    advice in 1989. Instead, it submits that Friedman br eached
    his professional duties by doing nothing whatsoever
    between the 1989 conversation and when the statute of
    limitations ran on any claim against O'Connor in 1991.
    Specifically, Dixon alleges that Friedman committed
    malpractice by: (1) advising Dixon in 1989 to delayfiling a
    claim against O'Connor; (2) assuring Dixon that he would
    revisit the issue again; (3) neglecting to r esearch when the
    limitations period would run; and (4) failing to r evisit the
    issue or to advise Dixon further about a claim against
    O'Connor until after the statute of limitations ran in 1991.
    When the evidence is read in the light most favorable to
    Dixon, we believe that there is a genuine issue of material
    fact as to whether Friedman committed malpractice. W e
    have already determined that ther e is a genuine issue as to
    whether Friedman created an attorney-client relationship
    between himself and Dixon with regard to a potential
    malpractice action against O'Connor. If such a relationship
    arose, Friedman assumed a duty to take any steps
    33
    necessary for the proper handling of the matter , to
    communicate about the matter with Dixon, and to advise it
    about the legal and strategic issues involved in the
    representation. See Ziegelheim v. Apollo, 
    607 A.2d 1298
    ,
    1303 (N.J. 1992). Substantial New Jersey case law supports
    the proposition that a lawyer has a specific duty to
    research, monitor, and advise his or her clients about
    statutes of limitations. See Sommers v. McKinney , 
    670 A.2d 99
    , 104 (N.J. App. Div. 1996) (observing that "[i]n rare
    cases, expert testimony is not required in a legal
    malpractice action where the duty of car e to a client is so
    basic that it may be determined by the court as a matter of
    law" and referencing the example of a lawyer who fails to
    file suit before the running of the statute of limitations);
    Brizak v. Needle, 
    571 A.2d 975
    , 982-83 (N.J. App. Div.
    1990) (finding the evidence sufficient to support a jury's
    finding of malpractice in a case where a lawyer failed to
    advise a client about the statute of limitations based on his
    mistaken view of when the claim accrued); Fuschetti v.
    Bierman, 
    319 A.2d 781
    , 784 (N.J. Law Div. 1974) ("The
    failure of an attorney to commence an action within the
    time of the statute would ordinarily be considered
    neglect.").
    In Brizak, the Appellate Division held that there was
    enough evidence to support a jury's verdict in favor of the
    plaintiff in a legal malpractice action. 
    See 571 A.2d at 982
    -
    85. The plaintiff had retained the defendant lawyer to
    represent her in a medical malpractice action. The lawyer
    never counseled the plaintiff about the statute of limitations
    because of his erroneous belief that a medical malpractice
    claim does not accrue until a plaintiff secur es an opinion
    by another doctor that the doctor he or she wishes to sue
    was negligent. See 
    id. at 980,
    982. This evidence, the
    Appellate Division held, was sufficient to support the jury's
    finding that the defendant lawyer had been negligent. After
    surveying applicable New Jersey case law, see 
    id. at 981-
    82, the court determined that, based on "the state of the
    law when defendant made his judgment[,] ther e was no
    reasonable basis for his belief " as to when the plaintiff 's
    medical malpractice claim would accrue. 
    Id. at 982.
    Moreover, the court indicated that it would have sustained
    the jury's verdict even had the defendant's mistaken belief
    34
    been reasonable because the defendant had failed "to warn
    plaintiff that her claim could be time-barr ed sooner in the
    event his belief [as to when her medical malpractice claim
    would accrue] was wrong." 
    Id. In light
    of both the general standards laid down by the
    Supreme Court of New Jersey and the specific precedent of
    Brizak, we hold that there is a genuine dispute of fact as to
    whether Friedman was negligent.14 The record establishes
    that Friedman did nothing with regar d to a claim by Dixon
    against O'Connor at any time between the initial
    conversation in the summer of 1989 and when the statute
    of limitations expired in the fall of 1991. Friedman never
    revisited the issue with Dixon during that time, he did no
    research to determine when the statute of limitations might
    expire, he did not file suit on Dixon's behalf, and he made
    no effort to secure another attor ney for Dixon. Under these
    circumstances, we think there is a genuine issue of
    material fact as to whether Friedman exercised reasonable
    and ordinary care and diligence.
    One might argue that Friedman did not br each a
    professional duty because, at most, he agr eed only to find
    a lawyer to handle Dixon's malpractice claim--not to
    research, monitor, and advise Dixon about the statute of
    _________________________________________________________________
    14. Brizak can be read as indicating that some attorneys who fail to
    advise or misadvise their clients about statutes of limitations are liable
    for malpractice as a matter of law. Such a rule might be viable in two
    sorts of cases: (1) where a lawyer never mentions the statute of
    limitations or the risks inherent in late-filing prior to the time the
    underlying claim expires; or (2) where a lawyer falsely describes muddy
    legal waters as clear. Indeed, Brizak suggests that liability may attach
    if
    a filing deadline is missed because a lawyer failed to counsel a client
    that the lawyer's opinion as to the status of the governing standards is
    vulnerable and might turn out to be wr ong in light of lurking problems
    with respect to the stability of precedents that inform the lawyer's
    opinion. In this case, however, we have no occasion to predict whether
    the Supreme Court of New Jersey would so hold. As we noted previously,
    Dixon has not appealed the District Court's denial of its motion for
    summary judgment; it has appealed only the grant of summary
    judgment in favor of Friedman and Franzblau Dratch. The only question
    before us, therefore, is whether the record would support a finding that
    Friedman committed malpractice--not whether it compels one.
    35
    limitations. We conclude, however, that this argument is
    not sufficient to compel summary judgment in Friedman's
    favor. First, there is no evidence that Friedman took any
    action with respect to getting Dixon another attorney
    between 1989 and 1991. Even if he assumed an obligation
    only to do that one thing, Friedman was obligated to do
    what he promised and there is no evidence that he did.
    Additionally--assuming that an attorney-client
    relationship was created--we disagr ee that Friedman was
    obligated to do nothing more than find Dixon another
    lawyer. This argument conflates two different inquiries: (1)
    whether an attorney-client relationship was created
    between Friedman and Dixon with respect to a malpractice
    action against O'Connor; and, assuming it was (2) whether
    Friedman breached a professional duty. As we have
    explained above, the evidence suggesting that Friedman
    promised to look into getting another lawyer to handle the
    matter is probative as to whether Friedman cr eated an
    attorney-client relationship with r espect to the O'Connor
    matter. Assuming that such a relationship was created,
    however, we do not believe that Friedman is entitled to
    summary judgment on the grounds that that is all he
    agreed to do. Once an attorney-client r elationship is created
    with respect to a given matter, New Jersey's Rules of
    Professional Conduct states that a lawyer may only "limit
    the objectives of representation" if"the client consents after
    consultation." New Jersey Rules of Professional Conduct,
    Rule 1.2; see also Baxt v. Liloia, 
    714 A.2d 271
    , 275 (N.J.
    1998) (Rules of Professional Conduct ar e relevant to,
    though not dispositive of, the question whether a lawyer
    committed malpractice). We do not believe that the evidence
    establishes as a matter of law that Friedman expressly
    informed Dixon that he would do no mor e than see if he
    could find it another attorney, much less that Dixon ever
    consented to this limitation.
    We therefore conclude that if Friedman created an
    attorney-client relationship with r espect to a malpractice
    claim against O'Connor (an issue on which we have already
    concluded that there is a genuine issue of material fact),
    there is a genuine issue of material fact as to whether he
    breached the professional duties such r epresentation
    36
    imposed. We will therefore r everse the District Court's order
    granting summary judgment in favor of Friedman and
    Franzblau Dratch.15
    V.
    The Judgment in Nos. 99-6055 and 99-6056, dismissing
    the claims against O'Connor's estate and the Schumann
    firm, will be affirmed. The Judgment in No. 99-6054,
    granting summary judgment in favor of Friedman and
    Franzblau Dratch, will be reversed and the case remanded
    for further proceedings consistent with this opinion. Parties
    to bear their own costs.
    _________________________________________________________________
    15. On appeal, Friedman and Franzblau Dratch pr offer another basis for
    affirming the judgment in their favor . Dixon's action against Friedman is
    based on its contention that he caused it to lose its malpractice claim
    against O'Connor. But even if Friedman was negligent, his dereliction
    caused no harm to Dixon unless it had a valid claim against O'Connor.
    Friedman and Franzblau Dratch argue that Dixon and Venture would
    not have been able to avoid ECRA even had O'Connor advised Dixon
    about it. If this is true then any negligence by O'Connor caused no harm
    to Dixon, and Dixon had no valid malpractice claim against Friedman.
    This is a straightforward example of the case-within-a-case phenomenon
    that often arises in professional malpractice litigation.
    Dixon offered evidence in response to Friedman and Franzblau
    Dratch's charges. 
    See supra
    note 8. Although the District Court
    described this issue as being "problematic" for Dixon, the court never
    resolved it. We could certainly consider this argument given our plenary
    standard of review, see, e.g., Hudson United Bank v. LiTenda Mortgage
    Corp., 
    142 F.3d 151
    , 159 (3d Cir. 1998), but we decline to do so.
    Determining whether there is a genuine dispute of fact over whether
    Dixon and Venture could have avoided ECRA had O'Connor told Dixon
    about it will require a highly fact-intensive, and ultimately
    counterfactual inquiry (because O'Connor did not, in fact, ever tell Dixon
    about ECRA). We therefore believe that the sounder course of action is
    to give the parties an opportunity to focus on this complicated issue
    during a further round of briefing and to allow the District Court to rule
    on it in the first instance.
    37
    A True Copy:
    Teste:
    Clerk of the United States Court of Appeals
    for the Third Circuit
    38