A San Jose hotel owner is seeking bankruptcy court approval to file a malpractice lawsuit against Pillsbury Winthrop Shaw Pittman LLP, saying it didn’t realize it was granting legal immunity for its attorneys when it left chapter 11, WSJ Pro Bankruptcy reported. SC SJ Holdings LLC, owner of the former Fairmont San Jose hotel, on Monday asked the U.S. Bankruptcy Court in Wilmington, Del., for permission to walk back certain provisions of its chapter 11 plan, which was approved last August and took effect in November. The reorganization plan that Pillsbury drafted contains more than five pages about immunity in “legal jargon” that protects the law firm from a range of claims but was impossible to understand, SC SJ said in its filing on Monday. “Pillsbury never informed or explained” to SC SJ that the provisions about legal immunity could absolve the law firm of potential malpractice liability from representing the hotel owner, the filing said. The owner believes it is entitled to seek damages through a malpractice lawsuit. SC SJ said the bankruptcy court should give it limited relief from the part of the approved plan that spells out immunity provisions preventing it from suing Pillsbury for malpractice. “Doing otherwise rewards Pillsbury for obtaining the releases without” the consent of SC SJ “and without the benefit of independent counsel,” the filing said. The Fairmont San Jose hotel, a frequent venue for technology conferences, filed for bankruptcy last March and was closed after a downturn in business events during the pandemic. The hotel is remarketing itself by switching to Hilton Hotels & Resorts ’ Signia brand and is taking reservations for late next month.
