NJ Supreme Court Considers Disgorgement Remedy for Disloyal GC // NJLaw Journal

In Kaye v. Rosefielde the Appellate Division of Superior Court held that a lawyer who worked as an independent contractor at the jobs of General Counsel and Chief Operating Officer had an implied attorney-client relationship with Kaye the principal of two Atlantic City businesses.  That subjected the lawyer to RPC 1.8 governing lawyers business involvements with current clients.

The App Div affirmed most of the trial judge’s findings but limited the remedies.  Upheld were voiding the lawyer’s interests in businesses he formed for the client, awarding counsel fees, and punitive damages. But Judge Nugent  denied the demand that the lawyer disgorge the $550,000/year he had been paid as in-house counsel and personal counsel.  Wages paid are not damages defendants have argued.

The New Jersey Supreme Court granted certification “limited to the issue of whether the Appellate Division erred by affirming the trial court’s holding that economic damages are a necessary prerequisite for disgorgement of the employee’s salary.” – gwc

via OTHERWISE: NJ Supreme Court Considers Disgorgement Remedy for Disloyal GC // NJLaw Journal.

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