In4Network, Inc. v. Perkins Coie

In In4Network, Inc. v. Perkins Coie (Feb. 20, 2007, B187934 (nonpub. Opn)) the Court reversed the judgment. The Court concluded: the original complaint alleged defendants were negligent in prosecuting a meritorious action on plaintiff's behalf; thus, the sham pleading doctrine applied with respect to allegations in the first amended complaint that defendants negligently induced plaintiff to file a meritless lawsuit; and no satisfactory explanation or showing of mistake or inadvertence had been made. (In4Network, Inc. v. Perkins Coie, supra, typed opn. at p. 11.) The opinion was based on the inconsistent allegations in the two complaints. The opinion did not avert to explanations for the inconsistent pleading offered in plaintiff's briefs for the first time on appeal. The opinion made no reference in the discussion to those explanations posited for the first time on appeal. The Court further held that both the original and first amended complaints contained allegations defendants engaged in a number of other actions that damaged plaintiff and that did not concern the merits of the underlying action. The Court held: "Both the original and first amended complaints allege that defendants engaged in a number of other actions which damaged plaintiff. Both pleadings contain allegations that plaintiff was injured as a result of defendants' professional negligence in: engaging in and advising plaintiff to engage in conduct which led to the imposition of sanctions; threatening to withdraw and abandon the case if plaintiff did not acquiesce to defendants' demands for a personal guarantee from 'plaintiff's principal' for legal fees which were in excess of the fee estimate; assigning the responsibility of the analysis and prosecution of all of plaintiff's claims to an associate after representing that senior attorneys at the firm were handling the underlying litigation; and charging excessive and unreasonable attorney fees without any benefit to plaintiff. Liberally construed, these allegations in both the original and amended complaints on their face are not inconsistent with the claim that defendants should never have filed the legal malpractice claims." (In4Network, Inc v. Perkins Coie, supra, typed opn. at pp. 11-12.) The Court concluded the judgment on the pleadings motion should have been denied because each count of the complaint stated a cause of action and potentially valid claims remained. (Ibid.)