DLA Piper LLP convinced a federal court in New York that it should hang onto jurisdiction of a legal malpractice suit brought against the law firm by a former client that accused it of bungling the defense of a shareholder derivative action.
Judge Victor Marrero of the US District Court for the Southern District of New York rejected a transfer bid by Link Motion Inc., which sued DLA and its attorney Caryn G. Schechtman in state court in September for allegedly failing to oppose a temporary restraining order application in the derivative action. DLA then removed the case to federal court.
Link argued in a motion that a remand back to the state court is necessary under Supreme Court precedent, in part because the state has a larger interest in attorney regulation.
But Marrero rejected that request Friday. The court held that the contested prongs of the test for it to retain jurisdiction, whether the federal issue raised is substantial and whether exercising jurisdiction over the malpractice suit would disrupt the federal-state balance, were satisfied.
The court said it’s “persuaded” that the case falls into the “small and special category” of cases in which a substantial federal issue is raised.
Link is represented by Felicello Law PC. DLA is represented by Gibson, Dunn & Crutcher LLP.
The case is Link Motion Inc. v. DLA Piper LLP (US), S.D.N.Y., No. 1:22-cv-08313, 12/23/22.
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