Legal Updates for Lawyers’ Professional Liability - CASE LAW UPDATE

Delaware Court Dismisses Legal Malpractice Case Arising from Underlying Class Action

Hernandez et al. v. Baird Mandalas Brockstedt & Federico, LLC, No. 204, 2024, 2025 WL 1304194 (Del. May 6, 2025)

The Supreme Court of Delaware recently held that a legal malpractice plaintiff could not sue the attorney representing the class in an underlying class action matter after the class action lawsuit settled, holding that the “finding in the underlying action that class representation was adequate precludes plaintiffs from now asserting a legal malpractice claim against defendants.” 

The trial court in Hernandez had found that court approval of the settlement of a class action rests on the essential finding that class counsel has adequately represented the class members, citing Wyly v. Weiss, 697 F.3d 131, 142 (2d Cir. 2012), where the court determined that “class members could not establish a breach of duty as a matter of law” because a finding that the class had been adequately represented is implicit in the court’s ultimate approval of a class settlement. 

The trial court noted that Delaware Superior Court Civil Rule 23—like the federal rule—outlines the lengthy requirements necessary to establish, maintain and ultimately settle a class action matter. The class action settlement process enables the court to make a determination that the settlement of the class action is fair and adequate, which necessarily includes a finding that the class members were adequately represented by class counsel. 

Thus, the Delaware Supreme Court held that the plaintiff’s legal malpractice case was barred by collateral estoppel, holding “the claims administrator's decision in the underlying class action was a final adjudication on the merits by a court of competent jurisdiction as the claims process was an approved process set up by the court in the underlying action.” Therefore, a party’s belief that the claims process was not fair to them cannot serve as a basis for a legal malpractice claim, absent fraud or another basis to overcome the bar of collateral estoppel. 

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