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Greenberg Traurig, LLP v. Frias Holding Co.

Supreme Court of Nevada

August 7, 2014

GREENBERG TRAURIG, LLP, A LIMITED LIABILITY PARTNERSHIP; GREENBERG TRAURIG, P.A., A PROFESSIONAL ASSOCIATION; AND SCOTT D. BERTZYK, AN INDIVIDUAL, Appellants,
v.
FRIAS HOLDING COMPANY, A CORPORATION; AND MARK A. JAMES, AN INDIVIDUAL, Respondents

Certified question, in accordance with NRAP 5, regarding the legal-malpractice exception to the litigation privilege. United States District Court for the District of Nevada; Gloria M. Navarro, Judge.

Question answered.

Brownstein Hyatt Farber Schreck, LLP, and Anthony J. DiRaimondo and Kirk B. Lenhard, Las Vegas; Steptoe & Johnson and Jon T. Neumann, Phoenix, Arizona; Bennett Evan Cooper, Esq., Paradise Valley, Arizona, for Appellants.

Carbajal & McNutt, LLP, and Daniel R. McNutt, Las Vegas, for Respondents.

Douglas, J. We concur: Gibbons, C.J., Hardesty, J., Parraguirre, J., Cherry, J., Saitta, J.

OPINION

Page 902

BEFORE THE COURT EN BANC.[1]

DOUGLAS, J.:

The United States District Court for the District of Nevada has certified a question of law to this court regarding the legal-malpractice exception to the litigation privilege. The litigation privilege immunizes from civil liability communicative acts occurring in the course of judicial proceedings, even if those acts would otherwise be tortious. Although Nevada has long recognized this common law privilege, we have not before determined whether it applies to preclude claims of legal malpractice or professional negligence based on communicative acts occurring in the course of judicial proceedings. The federal court asks " [w]hether Nevada law recognizes an exception to the common law litigation privilege for legal malpractice and professional negligence actions." We conclude that Nevada law recognizes the exception.

FACTS

In May 2005, Scott Bertzyk and Mark James were opposing counsel in a commercial real estate litigation matter. Bertzyk, an attorney at Greenberg Traurig, LLP, represented the buyer, L.A. Pacific Center, Inc. (LAP). James, an attorney at Bullivant Houser Bailey, P.C., at the time, represented the sellers, Hotels Nevada, LLC, and Inns Nevada, LLC (Hotels and Inns). LAP filed a complaint in both Nevada and California against Hotels and Inns on related claims. However, in 2006, James transitioned out of active involvement in both litigations, and became president and CEO of Frias Holding Company (FHC), a taxi and limousine service company.

In June 2008, the California suit went to arbitration, during which Bertzyk allegedly attacked James's character--asserting that James committed fraud and concealed or manipulated evidence.[2] In October 2009, the arbitration panel found in LAP's favor and awarded damages against Hotels and Inns. According to James, before the panel issued the final arbitration award, Bertzyk suggested to one of Hotel and Inns' attorneys that Hotel and Inns should explore filing a legal malpractice suit against its former attorneys, including James.

Meanwhile, in September 2008, James, in his capacity as FHC's president and CEO, retained attorney Mark Tratos of Greenberg Traurig to handle some intellectual property matters for FHC. And in July 2009, James retained attorney Michael Bonner (also of Greenberg Traurig) to personally represent him for his Nevada gaming license application. James was aware that Greenberg Traurig represented LAP in the litigation, but the firm did not inform James about the statements Bertzyk made during the arbitration. Moreover, during Greenberg Traurig's representation of James, LAP filed a lawsuit against Bullivant Houser Bailey, alleging attorney misconduct. In the misconduct matter, Bertzyk provided a declaration that reasserted the negative statements that he made about James during the arbitration.

After learning of Bertzyk's actions, James and FHC (collectively, respondents) terminated their respective relationships with Greenberg Traurig in August 2010 and filed a complaint against Bertzyk and Greenberg Traurig, LLP (collectively, appellants) in the Nevada district court, alleging that appellants ...


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