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Gregory P. Morson v. Kreindler & Kreindler

September 28, 2011


The opinion of the court was delivered by: Hurley, Senior District Judge


Plaintiff brings this diversity action*fn1 sounding in legal malpractice, breach of contract, breach of fiduciary duty, negligent and intentional infliction of emotional distress, and unfair business practices against Kreindler & Kreindler LLP. Now before the Court is defendant's motion for summary judgment pursuant to Fed. R. Civ. P. 56 as to all claims. For the reasons set forth below, the motion is granted.



Plaintiff's claims arise out of events that occurred during defendant's legal representation of plaintiff (or "Morson") and his sister, Vanessa Morson, (collectively, the "Morsons"), who served as the co-administrators of their mother's estate. The subject representation involved a 1996 case brought in this District alleging wrongful death against the Libyan government for its involvement in the 1988 bombing of Pan American Airlines flight 103 over Lockerbie, Scotland (the "Lockerbie action").*fn2 See Morson v. The Socialist People's Libyan Arab Jamahirya, No. 96 CV 2077 (TCP) (E.D.N.Y). In October 2002, a conditional settlement agreement was reached between the parties in that action that relied on the occurrence of three "triggering events," the details of which are not relevant for present purposes. (Statement of Undisputed Material Facts, pursuant to Local Civil Rule 56.1 ("56.1 Stmt.") ¶¶ 20-21.)

Prior to this conditional settlement, on December 26, 2001, judgment was entered against Morson for approximately $1.7 million in a separate lawsuit in the Southern District of New York. (56.1 Stmt. ¶¶ 24, 27); See Palazzetti Import/Export, Inc. v. Morson, No. 98 CV 722 (FM) (S.D.N.Y.)(the "Palazzetti action"). The judgment was later affirmed on appeal at some point in 2002. (56.1 Stmt. ¶ 28.) Kreindler & Kreindler LLP did not represent Morson in that action.

In late 2002, Morson and one Sergio Palazzetti began direct settlement negotiations without the aid of counsel regarding payment of the Palazzetti judgment. (56.1 Stmt. ¶ 34.) During these talks, Palazzetti indicated that he "would be amenable to settle for $500,000 in cash," as a lump sum, (Deposition of Sergio Palazzetti ("Palazzetti Dep.") at 58-69, D's Ex. I), though no final agreement was entered into by the two men at that time. (See Deposition of Gregory Morson ("Morson Dep.") at 46-47, D's Ex. G; see also Palazzetti Dep. at 51 ("The only thing I remember is that when we actually sort of agreed on the 500,000 number.").)

Around that same time, Palazzetti discussed with his attorney, Debra J. Guzov, what Palazzetti had learned primarily through the news media, viz., that Morson was involved in the Lockerbie action, that settlement talks were underway between the parties, and that Morson was potentially entitled to a large payout in that case. (56.1 Stmt. ¶¶ 22, 30; Palazzetti Dep. at 34-36.) Guzov then served Kreindler & Kreindler LLP with a "Restraining Notice," pursuant to N.Y. CPLR 5222, requesting that the firm complete an attached questionnaire concerning Morson's current and potential assets. On January 15, 2003, James P. Kreindler ("Kreindler") completed the questionnaire and returned it to Guzov. (Pl's Ex. 4.) In his response, Kreindler provided the following statement relevant to this suit: "We filed suit arising from the death of Eva I. Morson against Libya in 1996. We have a written settlement agreement which goes into effect when Libya complies with the United Nations requirements. Settlement not less than $5 million nor more than $10 million." (Pl.'s Ex. 5.)

Meanwhile, Palazzetti had informed his "trial counsel," Michael Regan (who had a lien on any judgment in the Palazzetti action), that he had discussed settling the Palazzetti action with Morson for $500,000. According to Palazzetti's testimony, Regan informed him that he learned from Guzov that the Lockerbie action "would be resolved positively for the Morsons very soon," and that he should not settle for less than the judgment. (Palazzetti Dep. at 58) Shortly thereafter, Palazzetti communicated to Morson that he would no longer settle the judgment for $500,000. Palazzetti testified that he changed his position because he "was told that [he] could get the whole amount in a fairly short time." (Palazzetti Dep. at 9, 64.)

The Morson's eventually recovered $10 million from the Lockerbie action (56.1 Stmt. ¶ 32; D's Ex. L.), and Palazzetti collected the entire amount of his judgment from Morson, (Pl.'s Ex. 7).

On January 22, 2003, Morson received a copy of the completed questionnaire mailed to him by Kreindler. (Morson Dep. at 53-55.) Morson immediately called Kreindler to discuss the matter, (id. 54-56) and Kreindler informed him that he was "obligated to answer the questionnaire and that that is what he had done," (id. at 57). At that time, Morson put two and two together and realized that Kreindler's response "completely derailed [his] negotiations with Mr. Palazzetti." (Morson Dep. at 58.)


Plaintiff originally filed this case in the Suffolk County Superior Court of Massachusetts on January 15, 2009, and defendant timely removed it to the United States District Court for the District of Massachusetts. On July 10, 2009, the Honorable Richard G. Stearns, United States ...

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