There is an interesting postscript story to the controversy surrounding New York attorney Aaron Schlossberg. As we discussed earlier, Schlossberg who went on a bizarre tirade against Spanish-speaking restaurant workers has quickly become the most hated man of the week in New York. The New York Post reported that he has now been kicked out of his office by Corporate Suites, the company that held his lease. Now, Schlossberg’s former client, Niche Music Group LLC, is suing him for embarrassing the company by its association to him. While I have little sympathy for Schlossberg (who is a GW grad), the lawsuit raises a troubling question over the liability of lawyers for statements or conduct made in their private lives. The premise of the action is that a lawyer can be sued if his views or actions cause embarrassment by association with clients.
Niche is a small record label based in Pittsburgh that produces capella and specialty music. In its complaint the company alleges legal malpractice and breach of contract based on the controversy at the restaurant. Schlossberg represented the company in a breach of contract lawsuit against Orchard Enterprises Inc. and Sony Music Entertainment. However, less than two weeks after the video surfaced from the restaurant, Niche fired Schlossberg and issued a statement from Niche Music president Stephen Wilde and general counsel Jonathan Clunies entirely distancing itself from the lawyer:
“After hearing Aaron Schlossberg’s views on the video, we decided to fire him from the single case for which we had hired him. Schlossberg was never our in-house counsel. We were not aware of his views and he never expressed them to us. We are appalled by his comments and behavior.”
We have followed cases where people have been fired after boorish or insulting conduct once their names and employers are made known. (here and here and here and here and here and here). Those cases however stopped with termination. Niche is seeking $50,000 in damages for the loss of corporate reputation and the resources spent in dealing with the controversy: “Schlossberg knew or reasonably should have known that his multiple public racist outbursts would reflect poorly on himself, his clients and his profession.”
That is a novel claim and one that would expose lawyers to new liability for any public position that a client later claims to be damaging to its reputation. Lawyers represent controversial clients or hold controversial views. That may impact their client base. However, a client is generally confined to the right to sever counsel not sue counsel for uncomfortable associations. It is also difficult to see the real damage since the company quickly severed Schlossberg with a strong statement of disassociation.
What do you think?