A $20 Million Lesson in Missed Details
Earlier this year, Ford O’Brien Landy LLP faced a $20 million malpractice lawsuit in New York state court. The former client alleged that the firm’s “haphazard” representation and failure to uncover key case-specific facts led to a $23.4 million arbitration loss.
The malpractice complaint was dismissed, leaving the client with no recourse after a devastating $23.4 million arbitration loss. This outcome illustrates the harsh reality of high-stakes litigation: when case-specific defenses are missed, the damage can be permanent.
Why Case-Specific Strategy Matters in Bankruptcy
To be clear, the Ford O’Brien case was not about a group defense or a boilerplate filing. But it offers a stark lesson: overlooked details can have catastrophic consequences.
In bankruptcy clawback defense cases, the danger is magnified when defendants join large defense groups or hire firms that rely on boilerplate strategies:
- Group representation often means uniform motions that don’t reflect individual defenses.
- Critical case-specific details such as ordinary course of business, new value, or setoff rights may be sidelined if they don’t fit the template.
- Once these arguments are overlooked or raised too late, the opportunity to use them effectively is lost. Timing matters. The sooner case-specific defenses are identified and asserted, the sooner they can be leveraged in negotiations. Early action often leads to resolution before litigation escalates into costly discovery and trial. Delay not only weakens the defense but also removes valuable opportunities to resolve the matter efficiently and on favorable terms.
The malpractice case shows how badly things can turn out when critical facts are missed. In bankruptcy preference lawsuits, the same kind of omission can mean paying millions that might have been defensible.
Tailored Defense Over Boilerplate
Every preference action turns on its own record of payments, contracts, and business dealings. A strong defense requires:
- Careful review of payment history and supporting documents.
- Independent legal strategy, not the lowest-common-denominator approach of a group.
- Preservation of all available defenses, even if they don’t apply to others in the litigation.
Our firm takes a white-glove, case-specific approach to defending creditors in bankruptcy. We don’t rely on mass templates. Instead, we tailor each defense to the facts of the client’s transactions and ensure that no viable defense is missed.
The Risk of Cookie-Cutter Defense
The Ford O’Brien malpractice case underscores the stakes: missing a case-specific defense can leave a client with staggering liability and no second chance. While that matter didn’t involve boilerplate defense, it highlights why creditors should be wary of group strategies in bankruptcy. Cookie-cutter approaches risk leaving your strongest arguments on the cutting room floor.
Protect Your Position
If you’ve been sued in a bankruptcy clawback or preference action, you need more than a boilerplate defense. Contact The Law Office of Magdalena Zalewski PLLC for a strategy tailored to your case.