FJD settles legal malpractice case against local law firm for $4 million

The legal saga between Pennsylvania’s First Judicial District and a local attorney over a

botched family courthouse deal has officially come to a close after the defendants recently agreed to pay Philadelphia’s court system $4 million to settle the legal malpractice claims.

The FJD had filed suit against attorney Jeffrey Rotwitt, the Philadelphia firm for which he previously worked, Obermayer Rebmann Maxwell & Hippel, and a limited liability partnership operated by Rotwitt over claims that the attorney failed to disclose to the FJD his dual role in the project to secure a location for a new family court building in downtown Philadelphia.

After bringing on Rotwitt as the court system’s liaison to find an acceptable location for the facility, the FJD learned that the lawyer was also a co-developer on the project, and thereby was getting paid twice for his work, which the courts viewed as double-dipping.

In November 2011, the FJD filed suit in Philadelphia’s Court of Common Pleas against Rotwitt, his Deilwydd Property Group and Obermayer, asserting legal malpractice and other claims.

The case was marked by some drama, including difficulties in getting a former state Supreme Court justice to sit for a deposition and counterclaims that were filed by Rotwitt against his former law firm.

The saga has come to a close, though, with the Dec. 6 settlement agreement that was approved by R. Stanton Wettick, Jr., the Allegheny County Common Pleas Court judge who was specially assigned to preside over the case in Philadelphia.

The stipulation says that aside from the $4 million settlement, all counterclaims and cross-claims involved in the litigation are to be dismissed with prejudice.

The stipulation was signed off on by the various attorneys in the case, which included FJD lawyer Richard A. Sprague, Obermayer defense attorneys Jeffrey B. McCarron and Candidus K. Dougherty, of the firm Swartz Campbell, Rotwitt’s attorneys Gerald J. Dugan and Eugene J. Maginnis, Jr., of Dugan, Brinkmann, Maginnis and Pace, and lawyer Catherine M. Recker, who represented Deilwydd Property Group.

A copy of the settlement agreement, which was attached as an exhibit to the court order, shows that the FJD will receive five separate payments from Travelers and Obermayer respectively between within 21 days of the execution of the settlement agreement and Jan. 3, 2014.

The agreement shows that Obermayer will pay out $2 million to settle the claims while Travelers, Obermayer’s and Rotwitt’s malpractice insurer, also agreed to pay $2 million.

The Legal Intelligencer, citing sources familiar with the litigation, reported that Rotwitt would be making no personal contribution to the settlement.

The paper further quoted Rotwitt as saying that the fact that he is not contributing to the settlement vindicated him; the attorney contended all along that he had disclosed his dual role as a developer to the FJD from early on.

The FJD originally planned to have developer Donald Pulver and his Northwest 15^th Street Associates group build the new family court building at 15^th and Arch streets in Center City, Philadelphia.

Rotwitt had partnered with Pulver to construct the facility for about two years.

The settlement dollars will be placed in the fund to build the new Philadelphia family courthouse, which has not yet been complete.

Pennsylvania Supreme Court Justice Ronald Castille, who, as the high court’s liaison justice to the project had been a co-plaintiff in the litigation, was quoted in the Legal Intelligencer as saying that the settlement in the case “puts the whole thing behind us and lets us focus on the building.”