The Wall Street Journal
November 5, 1986
By Patricia Bellew Gray
Staff Reporter of The Wall Street Journal

A Lawyer Who Sues Other Lawyers Wins Cases but Few Friends
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Edward Freidberg Takes On Legal-Malpractice Claims, Builds Lucrative Practice
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'I'm Just in This for Money'

SACRAMENTO, Calif. -- The woman thinks her lawyers botched the case. An auto accident left her legs badly disfigured, and all she received from the insurance company was $100,000, which seems paltry now. She wants to sue one of her lawyers for malpractice.

Attorney Edward Freidberg grins as he recounts his new client's legal woes. Her former lawyer's negligence appears obvious: He didn't file suit in time. The case against him could be worth an easy $500,000 to $600,000, Mr. Freidberg figures, if the lawyer has malpractice insurance. And if he doesn't?

I'll take his car, his house," Mr. Freidberg says, his eyes lighting up at the thought of suing the lawyer, an old foe. "If I could sell his wife, I'd do that, too. You see, I'm very vindictive. I really want to nail this guy."

California is a dangerous place to practice law these days, partly because of Mr. Freidberg. He was one of the first to buck the unwritten rule barring lawyers from suing other lawyers for malpractice when, in 1968, he took on, and later won, a precedent-setting legal-malpractice case. Since then, he has built a hugely successful practice on lawyers' mistakes and misdeeds and has wrung millions of dollars in settlements and awards out of them and their insurers.

His success has produced a lot of rich and happy clients, a lot of money for himself -- and a lot of detractors within his profession. Fellow lawyers shun the flamboyant 51-year-old as a pariah and boo him at conventions. But he doesn't seem bothered. "I am a mercenary," he says. "I'm just in this for the money."

James D. Hadfield, the president of Lawyers' Mutual Insurance Co. in San Francisco, acknowledges that Mr. Freidberg, a frequent opponent, gets "more in settlement than many lawyers. . . . He asks for large sums and gets them. A lot of lawyers ask for $50,000, but they'll take $2,000 when they get to the steps of the courthouse. With Ed, I know he's accurately calculated the value of his case, and he's ready to go to trial to get it."

Consider the case of Rodney A. Klein, a personal-injury lawyer in Sacramento. Hired by Michael and Carolyn McGill of Carmichael, Calif., to represent their family in a medical-malpractice suit against the hospital in which their daughter was born a quadriplegic, Mr. Klein won a $1,750,000 jury award against the hospital in 1977.

It was a stunning but short-lived victory. A lawyer hired by the hospital to appeal the judgment says he discovered that Mr. Klein had made a mistake: He had failed, in the trial, to ask the judge to give routine jury instructions. (Mr. Klein concedes that he didn't ask for the instruction but denies that that was an error.) Fearing a reversal on appeal, the family agreed to settle for $880,000, of which Mr. Klein got $330,000 in fees and costs.

Dismayed, the McGills turned around and sued Mr. Klein, whom they accused of bungling the case and overcharging them. The family, represented by Mr. Freidberg, won after a bitter three-month trial in state court. In 1984, a jury found Mr. Klein liable for legal malpractice and awarded the McGills $2.3 million. To avoid the delay of an appeal, the case was settled about a year later. Mr. Freidberg says the settlement was $1,970,000; Mr. Klein says he doesn't know how much his insurer paid.

Mr. Freidberg represented another of Mr. Klein's former clients in a second malpractice case against the personal-injury lawyer, which Mr. Freidberg says was settled for $350,000. Now, Mr. Freidberg is representing a third former client in a case pending in Sacramento County Superior Court. Says Mr. Klein: "Freidberg's a shark, a vicious man, a money-making machine."

Personal-injury lawyers are particularly vulnerable to malpractice claims by clients who -- years later, when the insurance money has run out -- begin to think that they were undercompensated. Increasingly, though, corporate lawyers also are being sued for their roles in ill-fated business ventures or for losing big cases.

Among Mr. Freidberg's favorite targets are divorce lawyers, especially those handling wealthy society clients. He says potential clients are plentiful because, after a divorce, people often resent their lawyers as much as their former spouses.

One such case involved a wealthy cattleman who lost hundreds of acres of prime ranchland to his former wife in a divorce. Represented by Mr. Freidberg, the cattleman sued his lawyer, on the ground that the lawyer had misinterpreted state law when negotiating the property settlement. That case was settled for $500,000, Mr. Freidberg says.

As a plaintiffs' lawyer, Mr. Freidberg doesn't get paid unless he wins. So he chooses cases carefully, turning away those he deems worth less than $100,000 in settlement or judgment. For every case accepted, he says he refuses about 20. (Even so, he has had a few losses.)

His fee typically is about one-third of what he wins for clients, but he often charges a premium -- up to a 50% fee -- to handle a case against the prominent or politically powerful, who tend to be difficult adversaries. Still, he says, "the market is limitless" because lawyers make errors "in an infinite variety of ways."

His brashness irks the State Bar of California, which by law is responsible for disciplining lawyers. David M. Heilbron, the bar's immediate past president, says a lawyer who doesn't turn over to the bar evidence of other lawyers' wrongdoing may be violating professional ethics. Replies Mr. Freidberg: "Forget the bar. They only go after drug dealers and embezzlers. Lawsuits are the only way of keeping doctors and lawyers in line."

Some detractors accuse Mr. Freidberg of ambulance-chasing. Mr. Klein says Mr. Freidberg approached several of his former clients and urged them to sue him. In one case, Mr. Klein says, "He told the parents {of a brain-damaged baby} that they had a responsibility to sue me and get more money for the baby."

Mr. Freidberg denies urging anybody to sue but says he often seeks out former clients of lawyers whom he is suing to hunt for evidence of "a pattern of wrongdoing." He adds: "Sometimes they become clients, but we're not soliciting business."

Adversaries fear his go-for-the-jugular style: He once had a lawyer served with a malpractice complaint on Christmas Eve. Others admire his skill and aggressiveness. "He's tenacious -- he wears people down," says Ronald E. Mallen, a San Francisco lawyer who defends many legal-malpractice cases. "Only if you've really bloodied him will he back off."

Mr. Freidberg's winning streak lets him live like an oil sheik, a style that makes him stand out in staid Sacramento. He declines to discuss his income, but he tools around in a new, cherry-red Porsche. His home is as garish as a disco, with orange and purple shag rugs, mirrored walls, a black marble bathroom and antique slot machines. Accompanied by his girlfriend, a 26-year-old blond hairdresser, he jets across the country to spend weekends at his New Jersey farm, where he keeps about 100 racehorses, or his Manhattan condominium.

Money wasn't always so plentiful. A 1960 law-school graduate of the University of California at Berkeley, Mr. Freidberg barely managed to squeak by when he first hung out a shingle in Sacramento, his hometown. Mostly, he recalls, he took scruffy little cases that fell off the desks of established lawyers. One early client was Satin Doll, a dancer who said her injuries in an auto crash pushed her out of the spotlight and into the chorus line.

But Mr. Freidberg wasn't destined for obscurity for long. In the early 1970s, he won national attention by representing a group of patients in a series of gruesome medical-malpractice cases against a Sacramento orthopedist, John Nork. Over four years, Mr. Freidberg says, he won more than $13 million for 38 clients in judgments and settlements against Dr. Nork and the hospital in which he practiced.

It was back then that Mr. Freidberg first ran afoul of the local legal community -- for grandstanding. At one point, for example, he disclosed to reporters that to prepare for trial, he had enlisted the aid of a surgeon and dissected a cadaver one night in a morgue.

Soon afterward, he broke completely with the legal establishment by accepting his first legal-malpractice case. His target: the then-vice president of the local bar association, who had represented Mr. Freidberg's first wife in a bitterly contested property-settlement case stemming from their divorce. Mr. Freidberg brought the malpractice suit on behalf of a woman who contended that the divorce lawyer had erred in not getting her a share of her former husband's military-retirement benefits.

Mr. Freidberg won $100,000 against the lawyer, a judgment affirmed in 1975 by the California Supreme Court. The case set legal precedent and touched off a flurry of legal-malpractice suits in California.

Today, that flurry has become an avalanche. Some experts blame the surge in legal-malpractice claims on the glut of lawyers and their resulting competition for business. Others note that several years ago, in an effort to curb an epidemic of suits against doctors, California lawmakers put a cap on the fees that plaintiffs' lawyers could charge in medical-malpractice cases. Many lawyers, including Mr. Freidberg, reacted by switching their specialty. The cap "left lawyers with no one to sue but themselves," Mr. Hadfield, the insurance executive, says ruefully.

California, long a legal trend-setter, has the highest rate of malpractice claims against lawyers, but the problem is nationwide. Fifteen years ago, a lawyer's chances of being sued for malpractice were remote. Today, fledgling lawyers can expect to face three such claims during their careers, according to Mr. Mallen, the former chairman of an American Bar Association committee on lawyers' liability.

Few claims pay off. Insurance experts estimate that only 1% of legal-malpractice claims go to trial and result in a judgment for the plaintiff. Nationally, the average claim paid by insurers runs only $15,500. Recently, however, disgruntled clients have won some big settlements.

Mr. Freidberg says 80% of the legal-malpractice suits handled by his firm are settled before trial. One reason is that few lawyers want to risk facing a jury as defendants. "Juries hate lawyers," says Mr. Klein, the personal-injury lawyer. "We rank just above used-car salesmen."

Putting the defendant-lawyer on the witness stand helps reinforce that perception, according to Mr. Freidberg. "Lawyers are lousy witnesses," he says. "They talk too much, and they're arrogant."

Mr. Freidberg himself may soon be on the witness stand. Two former clients have filed separate suits charging him with malpractice. Both suits are still pending.

One case involves a quadriplegic client who broke his neck diving into Lake Tahoe. The client, Richard Yenovkian, contends that Mr. Freidberg mishandled, and lost, a negligence case against the owners of the lakefront property where Mr. Yenovkian was swimming. Mr. Yenovkian has retained Mr. Klein to represent him in the suit, which Mr. Freidberg calls "totally, ridiculously without merit."

The other case involves a woman who contends that Mr. Freidberg's firm mishandled her malpractice suit against another lawyer by missing the deadline to file an appeal. Stanley P. Fleshman, one of three lawyers who work for Mr. Freidberg, admits missing the deadline by one day through a mixup on his office calendar.

Mr. Freidberg spares no expense or effort in fighting claims against him or his firm. He acts as his own attorney or as co-counsel in some cases, including the current divorce proceedings against his second wife. In suits against him, he sometimes countersues the plaintiff for malicious prosecution -- and wins.

"I'm a deep pocket, and a lot of people would like to knock me off," he says. "The only way you survive is to let everybody know 'You sue me, I'll sue you back.' "

Like about 50% of California lawyers, Mr. Freidberg no longer carries malpractice insurance. It got too expensive, he says, adding that the last rates quoted him were $127,000 a year for $1 million of coverage, with a $50,000 deductible.

He is flirting with danger. A lot of lawyers would love to handle the case that costs him his horses and his Porsche. "They're gunning for him, all right," Mr. Hadfield says. "He's like an old gunslinger, always looking over his shoulder."