## Facts

- Investors and a brokerage company agreed to invest $600,000 in a Connecticut shopping center project with Hartmann and related entities.
- The purchase agreement stated that no broker was involved, but the investors alleged a concealed “secret commission” requiring payment of a $1 million broker commission at closing.
- After learning of the alleged undisclosed commission, an investor demanded disclosure to the lender; Hartmann allegedly refused, and the investors did not proceed with the purchase.
- The investors sued Hartmann and others for, among other claims, civil RICO, RICO conspiracy, fraud, conversion, breach of contract, unjust enrichment, and breach of fiduciary duty.
- Certain defendants filed a third-party complaint against their former attorneys, alleging the attorneys advised that the commission need not be disclosed and seeking contribution, indemnification, and damages framed as malpractice/negligence and breach of contract.
- The attorneys moved to dismiss the third-party complaint under Rule 12(b)(6).

## Issues

1. Whether Rule 14(a) permits impleader of former attorneys for contribution or indemnification when the underlying claims (including civil RICO) provide no substantive right to contribution or indemnity.
2. Whether allegations of legal malpractice and breach of contract against counsel state proper third-party claims under Rule 14(a) when they are independent claims rather than derivative “liable over” claims tied to the plaintiff’s recovery.

## Decision

- The court granted the attorneys’ Rule 12(b)(6) motion and dismissed the third-party complaint in its entirety.
- Rule 14(a) was held inapplicable because it is purely procedural and cannot supply a contribution or indemnification right absent a substantive basis.
- Civil RICO was held not to provide a right of contribution or indemnification among alleged violators.
- The attempted impleader tied to the non-RICO claims also failed because the pleadings did not establish a recognized derivative obligation for the attorneys to pay all or part of any judgment owed by the defendants to the plaintiffs.
- The malpractice and contract theories were treated as independent claims not properly brought through impleader in this action.

## Legal Principles

- Rule 14(a) permits impleader only for claims where the third-party defendant may be liable to the defendant for all or part of the plaintiff’s claim (derivative or secondary liability).
- Rule 14(a) does not create substantive rights of contribution or indemnification; the third-party plaintiff must identify an existing legal basis for shifting or sharing liability.
- Civil RICO provides no right to contribution or indemnification among alleged wrongdoers.
- Impleader is improper when the defendant’s allegations against a third party amount to independent tort or contract claims (such as malpractice) rather than a valid “liable over” theory based on the plaintiff’s claim.

## Conclusion

The court dismissed the defendants’ third-party complaint against their former attorneys because the defendants lacked any substantive right to contribution or indemnification on the underlying RICO and related claims, and Rule 14(a) could not be used to litigate independent malpractice and contract disputes within the same action.


Friedman v. Hartmann, 787 F. Supp. 411 (S.D.N.Y. 1992)