The California Supreme Court is set to hear arguments next month in a dispute over whether Hartford Casualty Insurance Co. can seek reimbursement from a policyholder's lawyers. Attorneys say that a ruling in Hartford's favor could have a chilling effect on law firms, causing them to shy away from serving as independent counsel in the future. Hartford argues that it doesn’t make sense for independent defense lawyers to bill whatever they want and then pass on liability for the excessive fees to their client or the client’s insurer.

Under Hartford's theory, there would be no relief for independent counsel in a direct action brought by an insurer, according to Litigation partner Robert L. Wallan. "The law firm doesn't get any slack, because who is going to pay for its defense?" Wallan said. Click here to read the full article.