LAWRENCE v. LONGHI VS. STARR, GERN, DAVISON & RUBIN, Â PC(L-5506-13, ESSEX COUNTY AND STATEWIDE) ( 2017 )

NOT FOR PUBLICATION WITHOUT THE
APPROVAL OF THE APPELLATE DIVISION
This opinion shall not "constitute precedent or be binding upon any court."
Although it is posted on the internet, this opinion is binding only on the
parties in the case and its use in other cases is limited. R. 1:36-3.
SUPERIOR COURT OF NEW JERSEY
APPELLATE DIVISION
DOCKET NO. A-0645-15T1
LAWRENCE V. LONGHI,
Plaintiff-Appellant,
v.
STARR, GERN, DAVISON & RUBIN, PC,
and ALLAN R. MORDKOFF, ESQ.,
Defendants-Respondents,
and
WILLIAM B. JONES, II, ESQ.,
SIMIO & JONES, LLP, RICHARD
SULES, ESQ., and STOCKSCHLAEDER
MCDONALD & SULES, PC,
Defendants.
Argued October 24, 2017 - Decided November 14, 2017
Before Judges Carroll and Leone.
On appeal from the Superior Court of New
Jersey, Law Division, Essex County, Docket No.
L-5506-13.
Anthony Scordo, III argued the cause for
appellant (Law Offices of Stueben & Scordo,
attorneys; Mr. Scordo, on the brief).
Lisa Besson Geraghty argued the cause for
respondent Starr, Gern, Davison & Rubin, PC,
(Starr, Gern, Davison & Rubin, PC, attorneys;
Ms. Geraghty, on the brief).
PER CURIAM
Plaintiff Lawrence V. Longhi appeals from summary judgment
orders dismissing his legal malpractice action against defendants
Starr, Gern, Davison, & Rubin, P.C. (Starr Gern or the Firm),
Ronald Davison, Esq., Richard Welch, Esq., and Allan R. Mordkoff,
Esq. For the reasons that follow, we affirm.
I.
Plaintiff's claim of legal malpractice arises out of a failed
business relationship. Because this motion was decided under Rule
4:46, we recite the facts as presented by plaintiff, the non-
moving party. Robinson v. Vivorito, 217 N.J. 199, 203 (2014) ("We
derive the facts viewed in the light most favorable to plaintiff
from the record submitted in support of and in opposition to
defendants' motion for summary judgment.").
In March 2003, plaintiff, acting on behalf of his closely-
held companies Afgamco, Inc. and Longhi Associates, Inc., entered
into a Memorandum of Understanding (the Agreement) with the Michael
Baker Corporation and Weidlinger Associates, Inc. (collectively
referred to as the Baker Defendants) to jointly undertake
infrastructure development projects in Afghanistan and share in
2 A-0645-15T1
the profits. The Agreement specifically provided "a Joint Venture
(JV) will be established to prosecute the work . . . . [Plaintiff]
will be paid a commission based on the magnitude of the work
secured." According to plaintiff, following the United States
military intervention in Iraq, the Baker Defendants agreed to
expand the scope of the Agreement to Iraq as well.
Plaintiff's relationship with the Baker Defendants
deteriorated when he learned they accepted contracts from the U.S.
Army Corps of Engineers to build army bases in Iraq for the Afghani
army, a project valued at over two billion dollars. Plaintiff
never received notice of these government contracts from the Baker
Defendants.
The Underlying Litigation
Plaintiff maintained that the Baker Defendants procured
contracts with the assistance of plaintiff and his companies but
failed to advise plaintiff and his companies of the execution of
the contracts or compensate them in accordance with the Agreement.
Consequently, plaintiff retained Starr Gern as legal counsel to
pursue a breach of contract action. The retainer agreement
provided for compensation to Starr Gern on a contingent fee basis,
and allowed the Firm to withdraw as counsel under certain
conditions, including if Starr Gern determined that plaintiff's
3 A-0645-15T1
case would not recover a judgment sufficient to warrant pursuing
the litigation.
Starr Gern filed a complaint on behalf of plaintiff and his
companies against the Baker Defendants in September 2005 (the
underlying litigation). The complaint alleged, in pertinent part,
breach of contract and fraud.
On April 30, 2007, Starr Gern provided plaintiff with a
detailed memorandum containing "an overview of th[e] case as it
[] stands from a factual, legal and procedural standpoint." The
memorandum detailed available theories of recovery and concluded
that
even if [Starr Gern is] successful in gaining
access to all the information we seek . . . .
[t]his would require a significant investment
of our own, [] but if we were to successfully
develop the evidence [], the returns could be
substantial, both in terms of likelihood of
success and of eventual damages.
Four days later, on May 3, 2007, Starr Gern sent a letter
notifying plaintiff the Firm was withdrawing as counsel, and that
"in our meeting today it was agreed that you will engage new
counsel to pursue this case." The letter also advised plaintiff
his new counsel should "contact [Starr Gern] to make arrangements
for the transition of professional responsibility[.]"
That same day, the Baker Defendants' counsel sent a letter
to Starr Gern enclosing two contracts previously entered into
4 A-0645-15T1
between the Baker Defendants and the U.S. Army Corps of Engineers
Transatlantic Program Center. According to plaintiff, Starr Gern
failed to divulge this information to plaintiff or his successor
counsel.
In June 2007, Starr Gern filed a motion to be relieved as
plaintiff's counsel on the basis that "irreconcilable differences"
had developed in their relationship. Plaintiff responded by letter
to the court, indicating his "dissatisfaction with the timing and
justification for the withdrawal[,]" but also noting "that if
[Starr Gern] do[es] not wish to represent me any longer, then I
do not want them as my attorneys."
At this time, plaintiff had a pending discovery motion to
compel the Baker Defendants to release contracts pertinent to the
underlying suit, and a motion to extend discovery. After Starr
Gern withdrew, the court stayed the case for forty-five days so
plaintiff could retain new counsel. The court also sua sponte
withdrew both discovery motions and allowed them to be refiled
after the stay was lifted and new counsel retained.
Plaintiff retained new counsel in October 2007, but that firm
subsequently withdrew in February 2008. Thereafter, plaintiff
retained defendant Mordkoff, who had previously worked on the case
at Starr Gern before leaving the Firm. According to plaintiff,
neither Starr Gern, successor counsel, nor Mordkoff, ever re-filed
5 A-0645-15T1
the motion to compel the Baker Defendants to release the contracts
awarded to them in Afghanistan and Iraq.
At the close of discovery, the Baker Defendants moved for
summary judgment. The court granted the motion, determining that
federal [procurement] policy [ ] prohibits the
use or employment of any person who is
compensated on a contingency fee basis by
government contractors to secure contracts
with the federal government. . . . [E]ven if
any Army Corps of Engineers contracts were
obtained through plaintiff's efforts, federal
[procurement] law bars plaintiff's claim for
a finder's fee.
. . . .
Congress has provided two exceptions to this
rule, bona fide employees and bona fide
established commercial or selling entities.
Plaintiff does not suggest that his efforts
fall within either exception.
[(Emphasis added).]
The trial court dismissed the underlying action with prejudice on
July 18, 2008. Plaintiff did not appeal.
The Malpractice Action
Plaintiff commenced the present legal malpractice action on
January 13, 2013, alleging Starr Gern failed to disclose material
information to him obtained in discovery, including the contracts
enclosed with the May 3, 2007 letter from the Baker Defendants'
counsel, and represented to the court and plaintiff that his
lawsuit was meritless.
6 A-0645-15T1
During the malpractice litigation, plaintiff produced an
expert report authored by Michael P. Ambrosio,1 who opined:
the facts in the instant case clearly manifest
the existence of the required elements to
establish [d]efendant[s'] liability for legal
malpractice.
. . . .
[Defendants] failed to properly advise
[p]laintiff regarding his claims and failed
to turn over to [p]laintiff or successor
counsel material evidence of the existence of
contracts that [the Baker Defendants] had
obtained and . . . had agreed to pay
[p]laintiff's company one third of the profits
on those contracts.
Defendant Lawyers were negligent in their
failure to properly respond to the alleged
applicability of . . . 48 C.F.R. 3.400-
3.4[06].2
At the conclusion of discovery, Starr Gern and its individual
representatives, Davison and Welch, moved for summary judgment.
The motion judge conducted oral argument and framed plaintiff's
malpractice action as
based on an allegation that Starr[] Gern [ ]
failed to appraise [plaintiff] of [ ]
1
In his December 29, 2014 report, Ambrosio identified himself as
"an expert on the legal profession, legal ethics and legal
malpractice." Among his qualifications, Ambrosio served as a
Professor of Law at Seton Hall Law School for forty-four years,
during which he taught a course in Professional Responsibility for
thirty-six years.
2
These regulations provide the exceptions to the bar of the
federal procurement statute.
7 A-0645-15T1
correspondence evidencing contracts procured
by the Baker [D]efendants . . . to which
[plaintiff] allege[s] an entitlement to a
finder's fee commission . . . [thereby]
precluding [p]laintiff from procuring []
discovery.
. . . .
Plaintiff [further] contends that Starr Gern
never advised [him] of any related federal
statutes [pertinent to his case,] and never
advised him on the subject. . . . Plaintiff
alleges that by withdrawing when they did,
Starr[] Gern knew that plaintiff and new
[c]ounsel would never get fully and properly
prepared in time for trial . . . and failed
to turn over key documents necessary to
successfully litigate the case[.]
On January 23, 2015, the court granted summary judgment in
favor of Starr Gern, Davison, and Welch. The motion judge found:
[t]he underlying case was dismissed because
the contracts presented to the [c]ourt were
between the Baker [D]efendants and the U.S.
Army Corp[s] of Engineers. Finder's fees in
connection with those contracts are
specifically prohibited by the federal
procurement statute[.] . . . So the [c]ourt
found that plaintiff could not prevail as a
matter of law and granted summary judgment for
the Baker [D]efendants.
. . . .
[I]n granting summary judgment, the [c]ourt
observed that plaintiff was unable to proffer
any evidence of any contract that was awarded
to the Baker [D]efendants as a result of
plaintiff's effort, despite almost 900 days
of discovery. In addition, it is clear that
the [c]ourt considered the exceptions to the
federal procurement bar to a finder's fee.
8 A-0645-15T1
[(Emphasis added).]
Mordkoff thereafter moved for summary judgment, arguing
plaintiff was collaterally estopped from seeking damages based on
the court's ruling in the underlying action that the federal
procurement law barred his breach of contract action against the
Baker Defendants. The motion judge agreed, finding "this is a
case where collateral estopp[el] does apply." On August 7, 2015,
the judge entered an order dismissing the malpractice action
against Mordkoff. Plaintiff now appeals the summary judgment
orders.3
II.
When reviewing the grant of summary judgment, we analyze the
decision applying the "same standard as the motion judge." Globe
Motor Co. v. Igdalev, 225 N.J. 469, 479 (2016) (quoting Bhagat v.
Bhagat, 217 N.J. 22, 38 (2014)).
That standard mandates that summary judgment
be granted "if the pleadings, depositions,
answers to interrogatories and admissions on
file, together with the affidavits, if any,
show that there is no genuine issue as to any
material fact challenged and that the moving
3
Plaintiff's notice of appeal also references a companion order
entered on August 7, 2015, denying plaintiff's motion to extend
discovery, which the court concluded was rendered moot by the
entry of summary judgment. However, plaintiff has not briefed
that issue. An issue not briefed is deemed waived. See Gormley
v. Wood-El, 218 N.J. 72, 95 n.8 (2014).
9 A-0645-15T1
party is entitled to a judgment or order as a
matter of law."
[Templo Fuente De Vida Corp. v. Nat'l Union
Fire Ins. Co., 224 N.J. 189, 199 (2016)
(quoting R. 4:46-2(c)).]
"To defeat a motion for summary judgment, the opponent must
'come forward with evidence' that creates a genuine issue of
material fact." Cortez v. Gindhart, 435 N.J. Super. 589, 605
(App. Div. 2014) (quoting Horizon Blue Cross Blue Shield of N.J.
v. State, 425 N.J. Super. 1, 32 (App. Div.), certif. denied, 211
N.J. 608 (2012)), certif. denied, 220 N.J. 269 (2015).
"[C]onclusory and self-serving assertions by one of the parties
are insufficient to overcome the motion[.]" Puder v. Buechel, 183
N.J. 428, 440-41 (2005) (citations omitted).
In a legal malpractice action, "summary disposition is
appropriate only when there is no genuine dispute of material
fact." Ziegelheim v. Apollo, 128 N.J. 250, 261 (1992). "When no
issue of fact exists, and only a question of law remains, [we]
afford[] no special deference to the legal determinations of the
trial court." Templo Fuente De Vida, supra, 224 N.J. at 199
(citing Manalapan Realty, L.P. v. Twp. Comm. of Manalapan, 140
N.J. 366, 378 (1995)).
A legal malpractice action has three essential elements: "(1)
the existence of an attorney-client relationship creating a duty
10 A-0645-15T1
of care by the defendant attorney, (2) the breach of that duty by
the defendant, and (3) proximate causation of the damages claimed
by the plaintiff." Jerista v. Murray, 185 N.J. 175, 190-91 (2005)
(quoting McGrogan v. Till, 167 N.J. 414, 425 (2001)).
The first element requires an attorney "to exercise on his
client's behalf the knowledge, skill and ability ordinarily
possessed and exercised by members of the legal profession
similarly situated and to employ reasonable care and prudence in
connection therewith." Lamb v. Barbour, 188 N.J. Super. 6, 12
(App. Div. 1982), certif. denied, 93 N.J. 297 (1983). At a
minimum, an attorney must take "any steps necessary" to properly
handle a case, including carefully investigating the facts,
formulating a legal strategy, filing appropriate papers, and
communicating with the client. Ziegelheim, supra, 128 N.J. at
260-61. The second element requires a breach of these duties. As
to the third element, plaintiff must prove he suffered damages as
a proximate consequence of defendants' breach of duty. Garcia v.
Kozlov, Seaton, Romanini & Brooks, P.C., 179 N.J. 343, 357 (2004).
In the present case, there is no dispute that defendants owed
plaintiff a duty of care. We thus focus our analysis on whether
plaintiff adduced sufficient competent, credible evidence that
defendants breached that duty and, if so, whether such breach was
the proximate cause of plaintiff's damages.
11 A-0645-15T1
Plaintiff contends Starr Gern breached its duty of care by
(1) failing to disclose material information obtained during
discovery; (2) failing to raise the federal procurement
regulations in prosecuting the underlying matter; and (3)
misrepresenting to both plaintiff and the lower court that the
underlying lawsuit was meritless.
As to Starr Gern's "fail[ure] to disclose material discovery
information[,]" plaintiff points to the two contracts Starr Gern
received from the Baker Defendants' counsel in his May 3, 2007
letter. He argues Starr Gern never advised him or successor
counsel it received those contracts, thus resulting in a breach
of the Firm's duty of care. Plaintiff supports his argument with
the May 3, 2007 letter that shows Starr Gern received the two
contracts in discovery. In moving for summary judgment in the
malpractice action, Starr Gern's counsel submitted a certification
disputing the alleged non-disclosure. Thus, whether Starr Gern
disclosed these contracts to plaintiff or successor counsel in the
underlying action is a materially disputed fact.
As to Starr Gern's failure to inform plaintiff of federal
procurement law and accompanying exceptions, it is well-
established that "[i]gnorance of the law does not diminish [an
attorney's] responsibility." In re Rosner, 113 N.J. 2, 16 (1988);
see also Procanik by Procanik v. Cillo, 226 N.J. Super. 132, 150
12 A-0645-15T1
(App. Div.) ("If the law is settled, [an attorney] is expected to
know what it is and state it accurately."), certif. denied, 113
N.J. 357 (1988).
Here, Starr Gern compiled an eight-page memorandum providing
plaintiff with "an overview of this case as it currently stands
from [a] factual, legal and procedural standpoint." This analysis
completely fails to address federal procurement policy or its
exceptions. A reasonable juror could certainly conclude this
omission was rooted in negligence and Starr Gern failed to properly
advise plaintiff with respect to the merits of the underlying
action.
Assuming Starr Gern was negligent in withholding the contract
documents and failing to advise plaintiff on federal procurement
law, we next address whether such negligence was the proximate
cause of plaintiff's harm. For plaintiff to establish he was
damaged by defendants' negligence, plaintiff must have proffered
sufficient evidence that otherwise he would have prevailed and
obtained damages in the underlying litigation. He thus must have
proffered sufficient evidence that his companies fell within an
exception to the bar of the federal procurement policy.
"To establish the requisite causal connection between a
defendant's negligence and plaintiff's harm, plaintiff must
present evidence to support a finding that defendant's negligent
13 A-0645-15T1
conduct was a 'substantial factor' in bringing about plaintiff's
injury, even though there may be other concurrent causes of the
harm." Froom v. Perel, 377 N.J. Super. 298, 313 (App. Div.)
(quoting Conklin v. Hannoch Weisman, 145 N.J. 395, 419 (1996)),
certif. denied, 185 N.J. 267 (2005).
The simplest understanding of [proximate
cause] in attorney malpractice cases arises
from the case-within-a-case concept. For
example, if a lawyer misses a statute of
limitations and a complaint is dismissed for
that reason, a plaintiff must still establish
that had the action been timely filed it would
have resulted in a favorable recovery.
[Conklin, supra, 145 N.J. at 417.]
In granting summary judgment in the underlying action, the
court found plaintiff failed to proffer evidence of any contract
awarded to the Baker Defendants as a direct result of plaintiff's
efforts that would entitle plaintiff to a commission. Arguably,
however, a jury could find plaintiff's inability to produce the
two contracts at issue resulted from Starr Gern's negligence in
failing to disclose them. Moreover, in opposing Starr Gern's
summary judgment motion in the malpractice action, plaintiff
detailed the efforts of his companies that led to the procurement
of the two contracts enclosed with the May 3, 2007 letter that
were valued at over two billion dollars. Again, if accepted by a
jury, this evidence could have supported a finding that Starr
14 A-0645-15T1
Gern's negligence led to the dismissal of the underlying action
and plaintiff was damaged as a result.
Nonetheless, we conclude that plaintiff's malpractice claims
against all defendants fail because he did not adduce competent
evidence that the underlying action against the Baker Defendants
was not barred under federal procurement policy. To establish
legal malpractice, plaintiff was "required to show that competent,
credible evidence existed to support each of the elements of that
negligence action[.]" Cortez, supra, 435 N.J. Super. at 598.
In granting summary judgment in the underlying action, the
court concluded that federal procurement policy barred plaintiff's
recovery. The court noted bona fide employees and bona fide
established commercial or selling entities constituted exceptions
to this policy, and "[p]laintiff does not suggest that his efforts
fall within either exception."
Federal procurement policy, 41 U.S.C.A. § 3901,4 requires that
[e]very contract awarded after using
procedures other than sealed-bid procedures
shall contain a suitable warranty . . . by the
contractor that no person or selling agency
has been employed or retained to solicit or
secure the contract on an agreement or
understanding for a commission, percentage,
brokerage, or contingent fee, except for bona
fide employees or bona fide established
commercial or selling agencies the contractor
maintains to secure business.
4
The same policy exists under 10 U.S.C.A. § 2306.
15 A-0645-15T1
[(Emphasis added).]
48 C.F.R. § 3.400 through 48 C.F.R. § 3.406 "provide[]
policies and procedures that restrict contingent fee arrangements
for soliciting or obtaining Government contracts to those
permitted by 10 U.S.C.[A.] § 2306(b) and 49 U.S.C.[A.] § 3901."
48 C.F.R. § 3.400 (2017). Section 3.402(b) contains the exception
which, plaintiff argues, would have allowed him to survive summary
judgment in the underlying action had counsel properly researched
and presented it. The exception permits "contingent fee
arrangements between contractors and bona fide employees or bona
fide agencies." 48 C.F.R. § 3.402(b) (2017).
A bona fide agency is "an established commercial or selling
agency, maintained by a contractor for the purpose of securing
business, that neither exerts nor proposes to exert improper
influence to solicit or obtain Government contracts nor holds
itself out as being able to obtain any Government contract or
contracts through improper influence." 48 C.F.R. § 3.401 (2017).
Five factors are relevant in making this determination:
(1) whether the fees are commensurate with the
nature and extent of the services rendered by
the company and not excessive as compared with
the fees customarily allowed for similar
services; (2) whether the company had adequate
knowledge of the products and business of the
party it contracted with; (3) whether there
has been continuity in the relationship
between the parties; (4) whether the company
16 A-0645-15T1
is an established concern; and (5) whether the
arrangement is not confined to obtaining
government contracts.
[Puma Indus. Consulting, Inc. v. Daal Assocs.,
Inc., 808 F.2d 982, 985 (2d Cir. 1987).]
Improper influence is defined as "any influence that induces or
tends to induce a Government employee or officer to give
consideration or to act regarding a Government contract on any
basis other than the merits of the matter." Ibid.Plaintiff argues that his closely-held companies, Afgamco,
Inc. and Longhi Associates, Inc., fall within the exceptions to
the bar of the federal procurement statute. However, plaintiff's
certification in opposition to defendants' summary judgment
motions in the malpractice action is silent on this issue and does
not address any of the factors that would qualify him or his
companies as bona fide employees or agencies. Plaintiff's expert,
Ambrosio, did not submit a certification addressed to this point,
and in his report he merely referenced "Exhibit A" to plaintiff's
certification as "documentation" that "clearly demonstrates how
[plaintiff's] company was a bona fide agency." "Exhibit A," in
turn, is a copy of the March 17, 2003 Agreement that merely spells
out the commission arrangement between plaintiff and the Baker
Defendants and likewise does not address the factors that would
demonstrate a regulatory exception.
17 A-0645-15T1
In short, plaintiff failed to provide any competent factual
support for his contention that he fell within an exception to the
bar of the federal procurement policy. Consequently, he did not
establish he was entitled to damages from the Baker Defendants in
the underlying action, or that any legal malpractice by defendants
in that action was the proximate cause of any loss.
Affirmed.
18 A-0645-15T1