LONG & LEVIT LLP
PROFESSIONAL LIABILITY UPDATE
July 23, 2001 Issue No. 106
Jennifer A. Becker
Shoshana Y. Chazan
Edward F. Donohue, III
Kathleen M. Ewins
Mehrdad Farivar by Jennifer A. Becker
Bruce N. Furukawa
A New York based attorney licensed in California who negotiated contracts with
Howard M. Garfield California residents under California law has sufficient contacts with the state to invoke
subject matter jurisdiction.
Jason A. Geller
J. Michael Higginbotham Simon et al. v. Steverson, et al. 01 C.D.O.S. 3269
John B. Hook In 1997 film producer Shawn Simons that Steverson functioned essentially as a
Farand C. Kan retained Mark Steverson of the New supervised law clerk. Steverson claimed
York firm Rudolph & Beer to negotiate he was a New York resident and did not
Anna Kapetanakos agreements in connection with a planned travel to California to conduct business
Joseph P. McMonigle
film. According to the complaint, the on any other matter.
venture was compromised due to Mr.
Douglas J. Melton Steverson’s failure to negotiate contracts The Court of Appeals rejected the
on a timely basis and his subsequent “Sher/Cubbage” analysis. The correct
Peter B. Molgaard
misrepresentations about their status. analysis is whether the court can
Marsha L. Morrow exercise specific jurisdiction. Under
Plaintiffs sued Mr. Steverson and Carnelson v. Charney (1976) 16 Cal.3d
Robin M. Pearson
Rudolph & Beer for breach of contract, 143 there must be a substantial
Jessica B. Rudin fraud, constructive fraud, and connection between the defendant’s
professional negligence. Defendants forum contacts and the plaintiff’s claim.
Richard J. Sciaroni sought to quash service of the summons This is not a rigid analysis; courts should
Steven Sharafian on grounds that the court lacked both employ a flexible approach.
general and limited personal jurisdiction.
Jennifer W. Suzuki Defendants urged the court to analyze The court found that Steverson’s
whether the non-resident defendants had activities established sufficient contacts
sufficient contacts with California to to invoke specific subject matter
Karen L. Uno subject them to the court’s jurisdiction jurisdiction in California. The court
based on Sher v. Johnson (9th Cir. rejected Rudolph & Beer’s claim that
Seth E. Watkins
(1990) 911F.2d, 1357, 1361 and Steverson was acting as a law clerk. He
Gerald G. Weisbach Cubbage v. Merchant (9th Cir. 1984) was a licensed attorney who agreed to
744 F.2d. 665, 668. Rudolph & Beer provide legal services to California
Irene K. Yesowitch claimed that they did not solicit or residents. The Court of Appeals also
conduct legal business in California and rejected the trial court’s finding that the
601 Montgomery Street, Suite 900 2917 Santa Monica Blvd.
San Francisco, California 94111 Santa Monica, California 90404
Telephone (415) 397-2222 Telephone (310) 829-0991
Facsimile (415) 397-6392 Facsimile (213) 613-0664
act of negotiating a contract did not California to draft contracts for
qualify as the practice of law. The California residents under California
practice of law includes giving legal law. Thus, Rudolph & Beer sought
advice and contract preparation outside a benefits and privileges specific to
litigation context. The attorney’s California.
physical presence or absence is not
determinative. The practice of law in Comment: Physical absence from
California can occur through telephone, California will not shield attorneys
fax, computer or other means. servicing California clients from
responding to claims in California
Plaintiff’s retention of New York courts. There are no bright lines
counsel was not relevant. It was relevant delineating when a court will refrain
that New York counsel employed an from invoking subject matter jurisdiction
attorney licensed to practice in over out-of-state attorneys.
This publication is intended for general information purposes only and does not constitute nor is it intended to constitute legal advice.
The reader must consult with legal counsel to determine how laws or decisions discussed here apply to the reader’s specific
circumstances including whether the case may have been depublished after the date of this publication.
LONG & LEVIT LLP P ROFESSIONAL LIABILITY UPDATE 2