New York Court Throws Out Brokers' Legal Malpractice Case
The New York Law Journal recently reported on an interesting case here. According to the article, a New York judge threw out a legal malpractice case brought by a group of brokers who claimed the law firm they retained gave them faulty advice leading to a violation of a rule of the National Association of Securities Dealers (“NASD”) and a claimed $30 million in damages.
The article goes on to explain that the judge found that the brokers were already obligated to follow NASD rules as part of their employment agreement and therefore, the proximate cause of the brokers’ injuries was not the law firm’s advice but the brokers knowing violation of the NASD rule. The brokers had an obligation to follow the NASD rules as part of their employment – they knew the rules and chose to disregard them – the brokers caused their own damage. See, Smookler v. Kronish Lieb.