In February 2013, the U.S. Supreme Court held in Gunn v. Minton, 133 S. Ct. 1059 (2013), that there was no federal subject-matter jurisdiction over a legal-malpractice dispute arising out of the handling of an underlying patent case. Prior to the decision, applying federal-court precedent, one might have concluded that the “federal” nature of the underlying patent dispute in Gunn meant that the case belonged in federal court.
However, the Supreme Court’s explanation—and clarification—of the contours of “arising under” jurisdiction may signal a shift in federalism, at least in relation to legal-malpractice cases. The Supreme Court acknowledged that state courts can, and must, interpret potentially complex and difficult issues of federal law in the legal-malpractice context—and that it may not be the federal courts’ purview to accept subject-matter jurisdiction over such cases.
The ramifications of Gunn for lawsuits against attorneys and law firms extend beyond those arising out of patent disputes. The decision and its progeny suggest that state courts must adjudicate legal-malpractice disputes underpinned by virtually any area of federal law. Cases initiated in or removed to federal court on grounds of federal question before Gunn may no longer be welcome in federal court.
This is a significant development for legal-malpractice cases. There has long been a perception that federal courts are more qualified to handle the complex subject matter of federal questions, resulting in better and more consistent rulings when issues of causation, damages, and standard of care are considered in the legal-malpractice context. The Supreme Court’s decision in Gunn appears to have removed that option for legal-malpractice claims where there is no other basis for the exercise of subject-matter jurisdiction.