The WNBA operates women's basketball teams throughout the country, including a team that plays just across the river from New Jersey at Madison Square Garden.
The former owner of one WNBA team, Gemini Basketball Holdings (Gemini), has accused its former attorney of legal malpractice, breach of fiduciary duty, fraud and negligent misrepresentation.
Gemini was a majority owner in a group that purchased the women's basketball team in 2006. In order to avoid defaulting on its loans that originated at the time of the purchase, Gemini was hoping to refinance its loan obligations.
Gemini hired a law firm to represent its interests in the negotiations with the bank. Those negotiations were ongoing for several years, but Gemini apparently was not kept informed of any progress made with the bank. Instead, Gemini claims that they were kept in the dark about the bank's intent to default on the loans.
In the meantime, a minority owner of the team was reportedly privy to the information regarding the status of the loan negotiation, and that the bank was about to default on Gemini. With this knowledge the minority owner was strategically able to gain control over the management of the company once the bank did default on the loans. Finally, it seems the law firm told Gemini that they were representing the minority owner and not Gemini - perhaps presenting the appearance of a conflict of interest.
Was there a misunderstanding about who the law firm was representing? Was Gemini paying legal fees to this law firm? Why was the law firm withholding information from Gemini? Was it committing a breach of fiduciary duty? These questions will be addressed in this legal malpractice lawsuit.
Source: Opposing Views, "Gemini basketball Holdings Sues Law Firm for Malpractice," Oct. 29, 2012