DLA Piper Faces $180-M Malpractice Case For 2nd Time

Just when you think you’re out, the Second Circuit pulls you back in.

The 2018 lawsuit claimed Link Motion and three of its executives were stripping the company of valuable assets that were transferred to unknown third parties. I Image: DLA Piper

That’s what DLA Piper must be thinking after a Second Circuit decision vacated a lower court’s dismissal of Chinese software company Link Motion’s $180 million malpractice lawsuit, Kathryn Rubino reported for Above The Law.

The federal complaint was dismissed by Judge Victor Marrero as being time-barred, but the Second Circuit found—without commenting on the timing—that the case should be litigated in New York state court.

The case arises from a shareholder derivative action. The 2018 lawsuit claimed Link Motion and three of its executives were stripping the company of valuable assets that were transferred to unknown third parties.

Link Motion never responded to that lawsuit and consented to being placed into receivership.

Link Motion alleged in its legal malpractice case that DLA Piper could have raised defenses against the shareholder’s claims, arguing the firm’s malpractice cost it $180 million in damages.

DLA Piper asked for and received permission from a Manhattan judge to withdraw as Link Motion’s counsel in the shareholder case four months after it was filed. The firm said Link Motion was unable to pay its legal fees and was unresponsive.

Attorney for Link Motion, Michael Maloney, said of the Second Circuit’s decision: “We look forward to litigating this case in state court.”

However, DLA’s lawyer, Kevin Rosen of Gibson, Dunn, is looking on the bright side, noting in a statement that the appellate decision is “fully consistent with the fact that the substantive allegations are frivolous and sanctionable.”