Boutique New York firm Fox Horan & Camerini faces a $12m (£6.7m) malpractice claim after being found liable for mishandling an arbitration that resulted in a $10m (£5.6m) award against its client.
Delaware District Chief Justice Sue Robinson last month found the firm, which specialises in international arbitration, liable for legal malpractice in relation to its representation of New York-based investment fund TCW/ Camil Holding in an arbitration with IRHE Holdings.
Judge Robinson said that the firm had breached the standard of care it owed TCW/Camil Holding by failing to adequately investigate the fund’s obligations as contained in an agreement with investment fund IRHE Holdings, which were at issue in an arbitration.
She said the firm therefore failed to make an argument that would have prevented TCW/ Camil Holding being found liable for the $10m award.
The arbitration related to TCW/Camil Holding’s failed attempt to purchase a controlling interest in Brazil’s largest rice company Josapar. At the time, the fund entered an agreement with IRHE Holdings, an investor in Camil Holdings, to buy back its interest if the effort failed.
Judge Robinson is expected to set a trial date for the malpractice lawsuit later this month.
TCW/Camil Holding’s US law firm Grant & Eisenhofer is understood to be seeking $12m in damages from Fox Horan.
Fox Horan was unavailable for comment.