The following e-filed documents, listed by NYSCEF document number (Motion 014) 243, 244, 245, 246, 247, 248, 249, 250, 251, 252, 287, 291, 292, 293, 295, 296, 297, 298, 300, 303, 309, 317, 321, 323, 324, 333, 334, 335, 336, 337, 338, 344 were read on this motion for SUMMARY JUDGMENT. The following e-filed documents, listed by NYSCEF document number (Motion 015) 270, 271, 272, 273, 274, 275, 276, 277, 278, 279, 280, 281, 282, 283, 284, 285, 286, 299, 301, 304, 310, 316, 318, 325, 328, 329, 330, 331, 332, 339, 340, 341, 342, 343 were read on this motion for SUMMARY JUDGMENT. DECISION + ORDER ON MOTION Motion sequence numbers 014 and 015 are consolidated for disposition. This is a legal malpractice action brought by plaintiffs Reem Contracting Corp. (Reem Contracting), Jona Szapiro (Szapiro), Reem Plumbing and Heating Corp. (Reem Plumbing), and the Estate of Steven Stein (Stein) (collectively, plaintiffs) against defendants Altschul & Altschul, Mark Altschul, Esq. (Altschul), and Cory Dworken, Esq. (Dworken) (collectively, defendants). Defendants represented plaintiffs in a federal action seeking recovery under section 515 of the Employee Retirement Income Security Act of 1974 (ERISA), 29 USC §1145 (the underlying action). Defendants have asserted a counterclaim for account stated. Defendants move, pursuant to CPLR 3212, for summary judgment on their account stated counterclaim (motion sequence number 014). Plaintiffs move, pursuant to CPLR 3212, for summary judgment on their legal malpractice claim (motion sequence number 015). BACKGROUND The following facts are gleaned from the submissions of the parties. Reem Plumbing and Reem Contracting are entities that performed plumbing work in New York City (NY St Cts Elec Filing [NYSCEF] Doc No. 273 4; NYSCEF Doc No. 374, Szapiro tr at 17-18). Stein was the president and sole shareholder and office of Reem Plumbing (NYSCEF Doc No. 273 1). Stein’s brother-in-law, Szapiro, was the president of Reem Contracting (id., 2). In 2004, plaintiffs were named as defendants in the underlying action, captioned Trustees of Plumbers Local Union No. 1 Welfare Fund v. Reem Plumbing & Heating Corp., 04-CV-4698 (CBA) (ED NY) (id., 5). The trustees (the Trustees) alleged that Reem Plumbing and Reem Contracting were contractually obligated to contribute to certain union benefit funds (the Funds), as required by four collective bargaining agreements between the Association of Contracting Plumbers of the City of New York and Local Union No. 1 of the United Association of Journeymen and Apprentices of the Plumbing and Pipefitting Industry of the United States and Canada (id.). The Trustees conducted an audit for the period of January 1, 2002 through December 31, 2004, believing that there had been a significant shortfall in contributions (id., 6). The Trustees sought unpaid contributions, interest, liquidated damages, and attorney’s fees (id., 8). They also sought to hold Stein and Szapiro personally liable as fiduciaries of the Funds as defined under ERISA (id.). Altschul & Altschul represented plaintiffs in the underlying action (id., 9). Altschul and Dworken were tasked with defending plaintiffs (id., 10). Altschul testified at his deposition that he was admitted to practice in New York in 1985 (NYSCEF Doc No. 277, Altschul tr at 9). Altschul was assigned the strategy of the case, while Dworken handled the “grunt work” of representing plaintiffs (id. at 13-14). Before his representation of plaintiffs in the underlying action, Altschul had only litigated one ERISA case that settled (id. at 13). According to Altschul, Stein brought him the complaint and “was confident that that he was going to settle the case with the Union and that he wanted to put in an answer and to help him to move towards settling the case” (id. at 31). Altschul stated that he repeatedly informed plaintiffs “that their case was exceptionally weak and that the exposure was very great” (id. at 146). After Szapiro and Reem Contracting were added to the case, “[t]here was a discussion as to what could be potentially a conflict,” Altschul told them “they might want” separate counsel for the different defendants in the case, and plaintiffs “told [Altschul] they didn’t want it” (id. at 155-156). However, he did not discuss a potential waiver of any conflict of interest (id. at 157). At some point, Altschul told “Mr. Stein and Mr. Szapiro that they probably should retain an ERISA and/or a Union lawyer to handle this” (id. at 19). Altschul later testified that there was “[a]t least one” or “[p]robably more than one” occasion where he recommended retaining an attorney experienced in ERISA matters (id. at 26). Altschul stated that he believed his ethical obligations were to tell his clients “what their exposures were, what their options were”; “It was up to them to make decisions about what they wanted to do with the case and what happens is it’s my obligation if there’s something that I’m not familiar with to go and review such matters and maybe research such matters more deeply” (id. at 29). Altschul further testified that defendants did not conduct any party or nonparty depositions because his clients instructed him to save money (id. at 35-39, 112, 113, 120). According to Altschul, he told defendants that “we needed to be able to prepare for the case and that we needed to have better ammunition. [Stein] did not want to spend money for ammunition. [Stein] wanted to go and try to settle the case” (id. at 191). As Altschul recalled, he said: “you need to have an expert to review the audit. [He] also at the same time discussed with him the possibility of retaining other counsel who was familiar with some of these Union issues. [Stein] was insistent that at that point in time that he could settle the case with the Union” (id. at 192). Altschul further avers that he advised Stein and Szapiro that he thought that they needed an expert to do an audit of their books (NYSCEF Doc No. 329, Altschul aff, 6). Altschul states that “Plaintiffs insisted that they did not want to hire any experts,” “they didn’t have the money,” and “that they had full confidence in [Altschul] and their ability to resolve the matter with the Union” (id.,
6, 7). Dworken testified that he recalled having a conference call with Stein and Szapiro, but did not recall “the sum and substance of what was discussed about litigation tactics or strategy” (NYSCEF Doc No. 279, Dworken tr at 118-119). He did not recall whether he was aware that state case law did not apply to ERISA cases (id. at 115). Szapiro testified that Reem Plumbing and Reem Contracting were engaged in plumbing work, general contracting work, HVAC work, sprinkler work, and steamfitter work (NYSCEF Doc No. 274, Szapiro tr at 17, 18, 22, 28, 29, 66). Reem Plumbing and Reem Contracting performed both union and non-union work (id. at 67). The entities shared offices, tools, equipment, vehicles, and employees (id. at 18, 22, 29). Szapiro testified that he asked Altschul about deposing union delegates and the Association of Contracting Plumbers, to which Altschul replied “we didn’t have a right to do that. We couldn’t do that. They were suing us” (id. at 62). Szapiro testified that the first time that he learned about a conflict of interest was at his current counsel’s office (id. at 87). Further, Szapiro stated that the first time that he learned that there was personal liability under ERISA was “when [he] read that [he] had lost the federal case in court, in federal court and it said that [he] owed it personally” (id.). He did not remember any discussion about hiring experts or their own auditors (id. at 89). According to Szapiro, when defendants sent bills, he “assume[d] that they would be paid” (NYSCEF Doc No. 247, Szapiro tr at 60). He stated that “[t]here could have been a time” when the bills went unpaid (id.). He did not recall ever voicing an objection to the bills (id.). The Underlying Action United States District Judge Carol Bagley Amon scheduled a trial in the underlying action for May 2008 (NYSCEF Doc No. 273 49). As the trial in the underlying action approached, the parties advised the court that there were no material issues of fact (Trustees of Plumbers Local Union No. 1 Welfare Fund v. Reem Plumbing & Heating Corp., 2009 WL 10700668, *4, 2009 US Dist LEXIS 154698, *13 [ED NY, Mar. 31, 2009, No. 04-CV-4698 (CBA/VVP)], affd in part, vacated in part sub nom Reilly v. Reem Contr. Corp., 380 Fed Appx 16 [2d Cir 2010]). The parties stipulated before the District Court that Reem Plumbing and Reem Contracting were alter egos of each other (id.). Judge Amon adjourned the trial, and set a briefing schedule for the Trustees’ motion for summary judgment (id.). The Trustees moved for summary judgment, on the basis that Reem Plumbing was contractually obligated to contribute to the Funds during the audit period, and that Reem Contracting was responsible as Reem Plumbing’s alter ego (2009 WL 10700668, *5, 2009 US Dist LEXIS 154698, *13). The Trustees also argued that Stein and Szapiro were individually liable as fiduciaries of the Funds’ assets (id.). Plaintiffs herein opposed the motion, arguing that there was no valid and binding collective bargaining agreement between the parties and that Stein and Szapiro could not be held individually liable for any damages as the entities’ principals (id.). By memorandum and order dated March 31, 2009, Judge Amon granted the Trustees’ motion for summary judgment, finding that Reem Plumbing was obligated to make contributions to the Funds during the audit period (2009 WL 10700668, *8, 2009 US Dist LEXIS 154698, *25). Judge Amon further held that, since plaintiffs admitted that Reem Plumbing and Reem Contracting were alter egos, Reem Contracting was bound to the same collective bargaining agreements as Reem Plumbing (id.). Judge Amon further held that Stein and Szapiro were fiduciaries of the Funds under ERISA, and that they were personally liable given their exclusive control of the entities (2009 WL 10700668, *10, 2009 US Dist LEXIS 154698, *32). Finally, Judge Amon awarded damages against plaintiffs, jointly and severally, in the amount of $1,337,707.63 (2009 WL 10700668, *15, 2009 US Dist LEXIS 154698, *44). In doing so, Judge Amon determined the amount of unpaid contributions based solely on a Marshall & Moss audit of Reem Plumbing and Reem Contracting (2009 WL 10700668, * 13, 2009 US Dist LEXIS 154698, *40-41). Plaintiffs allege that they terminated defendants upon receiving the District Court’s decision, and retained their current counsel, who immediately filed an appeal (NYSCEF Doc No. 293 3). On appeal, the Second Circuit affirmed the District Court’s judgment only as to the issue liability, but vacated and remanded the case on the issue of damages, finding that there were issues of material fact as to damages and that the Trustees’ auditor’s report submitted to establish the unpaid contributions “rested on a bald and unsupported assumption” that all work done by Reem Contracting was covered under the collective bargaining agreements (Reilly, 380 Fed Appx at 20). Plaintiffs allege that, upon remand to the District Court, the Magistrate Judge did not permit any further discovery, limiting them to the evidence presented on the motion for summary judgment (NYSCEF Doc No. 1, verified complaint
