law firm and her application for unemployment benefits was denied.
When Crawford was made aware that
WYM Tech had ceased making payments,
she sent a letter to WYM Tech’s CEO on
behalf of the Reynoldses, demanding that
they catch up on those payments. But
WYM Tech failed to do so.
As a result, Mr. and Mrs. Reynolds
sued Crawford and her law firm for legal
malpractice, breach of fiduciary duty and
fraudulent misrepresentation. The Reynoldses claimed that they were required to
make mortgage payments on both houses
that were substantially higher than before
they became involved in the WYM Tech
system. They also contended that they
would lose one or both of those houses
to foreclosure since they did not have the
financial wherewithal to continue making those payments. The Reynoldses also
claimed depression, anxiety and humiliation, for which they underwent counseling and treatment.
Shortly before trial, the New York
Times published a front page article exposing the WYM Tech system as a real
estate Ponzi scheme.
Plaintiffs’ final settlement demand was
$3 million. Defendant’s final settlement
offer was $60,000 to resolve the case. At
the end of a six-day jury trial, plaintiffs’
attorney asked the jury to award $1 million in alleged damages.
What was the jury’s finding? It rendered a
no cause verdict in favor of the defendant,
answering “no” to the initial jury verdict
questions: Was the defendant professionally negligent, and was the conduct of the
Defendant’s theory at trial was that
there never was an attorney-client or
fiduciary relationship between the
plaintiffs and Crawford with regard to
plaintiffs’ decision to loan money to
WYM Tech. Mrs. Reynolds was merely
an employee of the firm. In addition,
even if an attorney-client or fiduciary
relationship could be established, Craw-
ford did not cause the plaintiffs to loan
money to WYM Tech. Mrs. Reynolds
chose, on her own, to participate in the
WYM Tech system as Crawford cau-
tioned Reynolds to wait to see whether
it worked for Ms. Crawford.
And finally, the lawsuit was filed, not
because of any alleged malpractice by
Crawford, but because Mrs. Reynolds’
application for employment benefits
was denied after she quit working for
the law firm.
David C. Anderson is an attorney/
shareholder in the firm of Collins
Einhorn Farrell PC, a Your House
Counsel member firm in the Greater
Detroit area. Anderson serves as
co-chair of the Professional Liability
Practice Group. He can be reached at
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