11 Dec No Comments MikeT Counterfeit Check

Facts: The plaintiff law firm received from a new client a check for a large amount payable to the law firm purporting to be drawn on the account of a major corporation. The law firm maintained its attorney trust account at the same bank as the new client. The law firm deposited the check into its attorney trust account and then wire transferred a substantial portion of the proceeds to a third party in Korea. The bank dishonored the deposited check and charged it back against the attorney trust account. The law firm then filed suit against the bank alleging that the bank had made “final payment” of the check, failed to give timely notice of dishonor of the check and that it was unlawful to charge-back a dishonored check against an attorney trust account.

Client: The defendant bank.

Subject of Expert Report: Whether or not (1) the bank made “final payment” of the check at issue; (2) Whether or not the bank gave timely notice to the law firm of its dishonor of the check; and (3) whether or not the bank had a right to charge-back the amount of the check to the firm’s attorney trust account.

Outcome: The case settled shortly after the conclusion of discovery.