Key Points

  • The Second Department affirmed a Westchester County order denying Kreindler & Kreindler's motion to dismiss a legal malpractice claim brought by the family of 9/11 victim Calvin Gooding.
  • The court held that the plaintiffs have a cause of action for legal malpractice, relying on allegations that the firm named Rhonda Sapp-Gooding as a plaintiff in the Ashton I and II actions even though she did not sign a retainer until 2021.
  • The firm showed that the alleged malpractice accrued no later than February 19, 2020, more than three years before suit, but the plaintiffs raised questions of fact on continuous representation that defeated the CPLR 3211(a)(5) motion.
  • The court held that the trial court providently granted a CPLR 306-b extension of time to serve in the interest of justice.
  • The complaint alleges the family would have received 5.8574% of eligible VSSTF damages with timely judgments and applications but received only .0626%.

A New York appeals court on Wednesday let the family of a man killed in the Sept. 11, 2001, attack on the World Trade Center pursue a legal malpractice suit against Kreindler & Kreindler LLP. The family alleges that the firm's delays left it with about $13,000 from a federal fund for terrorism victims on judgments worth more than $26 million.

The Appellate Division, Second Department, affirmed an order by Charles D. Wood of the state Supreme Court in Westchester County that refused to dismiss the claim. The panel of Francesca E. Connolly, Linda Christopher, Lillian Wan and Susan Quirk affirmed the order with costs, and all four concurred.

The ruling keeps alive the malpractice claim the family asserted against the firm, James P. Kreindler, Megan Wolfe Benett, and nonparties Noah Kushlefsky and Andrew Maloney. The panel held that the family has a cause of action for legal malpractice, relying on the complaint's allegations about the firm's own court filings, although the widow did not sign a retainer agreement until 2021, more than 17 years after the firm first named her as a plaintiff. It also held that factual disputes over the firm's continuing representation kept the three-year statute of limitations from ending the suit.

Calvin Gooding died in the attacks and was survived by his wife, Rhonda Sapp-Gooding, and two children, Celia Rose Gooding and Zaya Gooding. In 2002, the Kreindler firm filed Ashton v. Al Qaeda Islamic Army in the U.S. District Court for the Southern District of New York on behalf of thousands of 9/11 victims and their families. On Aug. 1, 2003, the firm added Sapp-Gooding as the representative of her husband's estate, acting "under the belief that Sapp-Gooding would be signing and returning a retainer agreement," the court wrote.

Sapp-Gooding never returned that agreement, and she had no contact with the firm between 2003 and 2020, according to the decision. In 2015, the firm won a default judgment against Iran on liability. It then sought a final judgment of $8,880,000 for the estate. In 2017, the firm named her again in a second federal suit, against the Kingdom of Saudi Arabia.

In 2019, Congress passed the United States Victims of State Sponsored Terrorism Fund Clarification Act. The law, the court wrote, expanded access to the Victims of State Sponsored Terrorism Fund to 9/11 victims, spouses and dependents "who obtained a final judgment against a state sponsor of terrorism." Sapp-Gooding then hired a lawyer, who discovered that the Kreindler firm was representing her. After that lawyer failed to obtain fund benefits, the family signed retainers with the firm in February 2021.

The firm then obtained final judgments totaling $43,080,791, including $12.5 million for Sapp-Gooding and $13,580,791 for the estate. The fund paid $6,359.46 on the widow's behalf and $6,909.32 to the estate, about .0626% of their eligible damages, the court said. The family's complaint alleges that it would have received 5.8574% had the firm obtained the judgments and filed fund applications before Feb. 19, 2020.

Sapp-Gooding sued on July 25, 2023, by filing a summons with notice. Wood later extended the family's deadline to serve the defendants under CPLR 306-b and denied the part of the Kreindler lawyers' cross-motion that sought dismissal of the malpractice claim. They appealed.

On whether a lawyer-client relationship existed, the panel quoted an earlier appellate ruling: "Since an attorney-client relationship does not depend on the existence of a formal retainer agreement or upon payment of a fee, a court must look to the words and actions of the parties to ascertain the existence of such a relationship."

The complaint pointed to the firm's 2003 filing, the 2015 default judgment and damages request, and the 2017 suit against Saudi Arabia. As the court summarized it, the complaint also alleged that because the firm obtained the judgments and filed the applications after the deadline, "the plaintiffs received only .0626% of their eligible damages from the VSSTF." Considering the evidence both sides submitted, the panel concluded that "the plaintiffs have a cause of action alleging legal malpractice."

New York gives malpractice plaintiffs three years from the error to sue. The panel held that the Kreindler lawyers had shown the claim accrued no later than Feb. 19, 2020, which the court called "the third deadline for VSSTF applications," more than three years before the suit was filed.

The family relied on continuous representation, a doctrine that pauses the limitations clock while a lawyer keeps handling the same matter. Quoting earlier rulings, the panel wrote that the doctrine requires "clear indicia of an ongoing, continuous, developing, and dependant relationship between the client and the attorney which often includes an attempt by the attorney to rectify an alleged act of malpractice."

The family raised questions of fact on whether both sides understood that further representation was needed and on whether the Kreindler lawyers "engaged in a course of continuous representation intended to rectify or mitigate the alleged malpractice," the panel held.

The panel also upheld the extension of time to serve the defendants under the interest-of-justice standard, which it described as one that "accommodates late service that might be due to mistake, confusion, or oversight, so long as there is no prejudice to the defendant." The family sued and attempted service on time, had a potentially meritorious claim and caused no demonstrable prejudice by the delay, the court said. "The Kreindler attorneys' remaining contentions are without merit," the panel wrote.

Thomas A. Leghorn of London Fischer LLP represented the Kreindler firm and its lawyers. Akiva M. Cohen of Kamerman, Uncyk, Soniker & Klein P.C. represented the family.

The ruling, 2026 NY Slip Op 06159, is uncorrected and subject to revision before publication in the Official Reports.