A jury has delivered a $5 million legal malpractice verdict against a Detroit law firm in the U.S. District Court for Eastern Michigan. Jaffe, Raitt, Heuer & Weiss was retained to “vet” a Minneapolis-based office furniture manufacturer for potential acquisition for a client. The firm allegedly failed to advise the client concerning the buyer’s $3.26 million underfunded pension liability. In fact, the firm advised its clients that it had no exposure for the liability.
The client proceeded with the acquisition and invested millions of dollars into the company to boost revenue. As a result, the pension liability increased to $4.86 million within three years, all of which was determined to be the buyer’s obligation.
The buyer then sued the firm, claiming its negligent opinion caused the company damages. There was a trial, resulting in a jury award of over $5 million in damages. It is unclear whether the firm will appeal the verdict and judgment.
Cohen et al. v. Jaffe, Raitt, Heuer & Weiss, P.C. et al.