Counsel Concerns

Malpractice Suit over Sound Recordings Is Reinstated

The New York Appellate Division, First Department, reinstated a malpractice suit filed by a law firm client over copyright problems from releasing re-mastered sound recordings. HNH International Ltd. V. Pryor Cashman Sherman & Flynn LLP, 2009 N.Y. Slip. Op. 04964. The trial court had granted Pryor Cashman's motion to dismiss HNH's malpractice suit, which alleged the law firm “incorrectly advised [HNH] concerning the early 20th century sound recordings they proposed to re-engineer, re-master and distribute as CDs.” The recordings in question ' classical music works by artists like Sergei Rachmaninov, Yehudi Menuhin and Pablo Casals ' were released through HNH's Naxos of America subsidiary. Capitol Records sued Naxos over the products' distribution. The New York Court of Appeals ultimately decided that a New York common-law copyright isn't extinguished by termination of a foreign copyright in a work and that a “new” re-mastered recording can infringe on an original work. Capitol Records Inc. v. Naxos of American Inc., 4 N.Y.3d 520 (2005).

In HNH's malpractice suit, the trial court determined that the law was unsettled at the time Pryor Cashman rendered its advice to HNH. Reversing, the New York appellate court explained, “however, that the state of the law was not so unsettled at the time the advice was given as to bar as a matter of law plaintiffs' claim that a reasonably skilled attorney would have advised that the CDs were or might be entitled to common-law copyright protection and would not have advised that the release of the CDs would not result in any copyright liability. Although defendant maintains that it did advise plaintiffs of the possibility of common-law liability and did not advise plaintiffs that the release of the CDs would not result in any copyright liability, we must accept the facts alleged in the complaint as true and accord plaintiffs the benefit of every possible favorable inference ' The determination whether defendant exercised the requisite level of skill and care must await expert testimony.”

Counsel Withdrawal Motion Granted

The U.S. District Court for the District of Minnesota adopted a magistrate's recommendation that a law firm be allowed to withdraw as counsel for a broadcasting company sued for allegedly broadcasting music without permission. Universal-Polygram International Publishing Inc. v. Prairie Broadcasting Co., 09-CV-0576 (PJS/RLE). Nikolai & Mersereau P.A. had been contacted by the president of Prairie Broadcasting to serve as defense counsel in the copyright infringement suit. The law firm asked that a retainer agreement be signed and a $2,000 retainer fee be paid, but neither was done. The copyright plaintiffs later filed a motion for a default judgment. Nikolai & Mersereau moved “to withdraw without substitution [of counsel], based upon the Defendants' complete failure to communicate with” the law firm.

In the District of Minnesota, court permission is required to cease being counsel to a client where no substitute is provided. “Good cause” must exist for withdrawal to be granted. In determining whether good cause existed in this case, the federal magistrate noted that “we have held the mere prospect that the action may not be as financially rewarding as counsel might have earlier anticipated, without more, would not satisfy the good cause showing.”

But the magistrate continued: “[T]his is not a circumstance in which the Law Firm seeks withdrawal because the prospects of the Defendants' case may not appear as they first did. Instead, the Defendants have effectively prevented the Law Firm from providing any representation, let alone effective representation. Moreover, we find no authority which requires the Law Firm to donate its time and efforts to the Defendants. ' Here, the Plaintiffs have already obtained an entry of default from the Clerk of Court, and have scheduled a Hearing on their Motion for Default Judgment. Accordingly, on the Record presented, we conclude that allowing the Law Firm to withdraw will not result in a significant disruption of this action's progress. Indeed, the Defendants' behavior, and their refusal to communicate with their counsel of Record, demonstrates that they do not intend to oppose what appears to be the inevitable conclusion of this action.”

Malpractice Suit over Sound Recordings Is Reinstated

The New York Appellate Division, First Department, reinstated a malpractice suit filed by a law firm client over copyright problems from releasing re-mastered sound recordings. HNH International Ltd. V. Pryor Cashman Sherman & Flynn LLP , 2009 N.Y. Slip. Op. 04964. The trial court had granted Pryor Cashman's motion to dismiss HNH's malpractice suit, which alleged the law firm “incorrectly advised [HNH] concerning the early 20th century sound recordings they proposed to re-engineer, re-master and distribute as CDs.” The recordings in question ' classical music works by artists like Sergei Rachmaninov, Yehudi Menuhin and Pablo Casals ' were released through HNH's Naxos of America subsidiary. Capitol Records sued Naxos over the products' distribution. The New York Court of Appeals ultimately decided that a New York common-law copyright isn't extinguished by termination of a foreign copyright in a work and that a “new” re-mastered recording can infringe on an original work. Capitol Records Inc. v. Naxos of American Inc. , 4 N.Y.3d 520 (2005).

In HNH's malpractice suit, the trial court determined that the law was unsettled at the time Pryor Cashman rendered its advice to HNH. Reversing, the New York appellate court explained, “however, that the state of the law was not so unsettled at the time the advice was given as to bar as a matter of law plaintiffs' claim that a reasonably skilled attorney would have advised that the CDs were or might be entitled to common-law copyright protection and would not have advised that the release of the CDs would not result in any copyright liability. Although defendant maintains that it did advise plaintiffs of the possibility of common-law liability and did not advise plaintiffs that the release of the CDs would not result in any copyright liability, we must accept the facts alleged in the complaint as true and accord plaintiffs the benefit of every possible favorable inference ' The determination whether defendant exercised the requisite level of skill and care must await expert testimony.”

Counsel Withdrawal Motion Granted

The U.S. District Court for the District of Minnesota adopted a magistrate's recommendation that a law firm be allowed to withdraw as counsel for a broadcasting company sued for allegedly broadcasting music without permission. Universal-Polygram International Publishing Inc. v. Prairie Broadcasting Co., 09-CV-0576 (PJS/RLE). Nikolai & Mersereau P.A. had been contacted by the president of Prairie Broadcasting to serve as defense counsel in the copyright infringement suit. The law firm asked that a retainer agreement be signed and a $2,000 retainer fee be paid, but neither was done. The copyright plaintiffs later filed a motion for a default judgment. Nikolai & Mersereau moved “to withdraw without substitution [of counsel], based upon the Defendants' complete failure to communicate with” the law firm.

In the District of Minnesota, court permission is required to cease being counsel to a client where no substitute is provided. “Good cause” must exist for withdrawal to be granted. In determining whether good cause existed in this case, the federal magistrate noted that “we have held the mere prospect that the action may not be as financially rewarding as counsel might have earlier anticipated, without more, would not satisfy the good cause showing.”

But the magistrate continued: “[T]his is not a circumstance in which the Law Firm seeks withdrawal because the prospects of the Defendants' case may not appear as they first did. Instead, the Defendants have effectively prevented the Law Firm from providing any representation, let alone effective representation. Moreover, we find no authority which requires the Law Firm to donate its time and efforts to the Defendants. ' Here, the Plaintiffs have already obtained an entry of default from the Clerk of Court, and have scheduled a Hearing on their Motion for Default Judgment. Accordingly, on the Record presented, we conclude that allowing the Law Firm to withdraw will not result in a significant disruption of this action's progress. Indeed, the Defendants' behavior, and their refusal to communicate with their counsel of Record, demonstrates that they do not intend to oppose what appears to be the inevitable conclusion of this action.”