241 F.3d 1334 (11th Cir. 2001)
H. Boone PORTER, III, in his capacity as individual co-trustee of the H. Boone Porter Trust created under Deed of Trust dated 8/1/60 as amended by amendment dated 5/14/68, and individually, and in his capacity as Executor of the Estate of Rev. H. Boone Porter, Commerce Bank, N.A., a national banking association, in its capacity as corporate co-trustees of the H. Boone Porter Trust created under
Deed of Trust dated 8/1/60, as amended by amendment dated 5/14/68;  Plaintiffs- Appellants, Cross-Appellees,v.OGDEN, NEWELL & WELCH, a Kentucky general partnership, Richard F. Newell, et al., Defendants-Appellees, Cross-Appellants.

No. 99-2289.
United States Court of Appeals,Eleventh Circuit.
Feb. 15, 2001.Feb. 27, 2001
Appeals from the United States District Court for the Middle District of  Florida.94-00051-CIV-J-16A), John H. Moore, II, Judge.
Before TJOFLAT, BIRCH and DUBINA, Circuit Judges.
DUBINA, Circuit Judge:


1
The Trustees of the Estate of H. Boone Porter appeal the district court's order  finding that a legal malpractice action against the Defendants had not accrued  under Florida law because no injury had occurred. Also appealed are an order of  a magistrate judge denying the Trustees' motion to compel and an order of the  magistrate judge permitting the Trustees to obtain financial worth documents. We  affirm in part and reverse in part.

I. BACKGROUND

2
This case revolves around H. Boone Porter's ("H.Boone") will and deed of trust.  In 1960, the law firms of Rogers, Towers & Baily, (the "Bailey firm"), and  Ogden, Newell, & Welch, (the "Ogden firm"),1 jointly prepared a will and deed of  trust for H. Boone. The law firms drafted the deed of trust to create a "double  generation skipping trust" that would benefit H. Boone during his lifetime, then  his wife and his son, Reverend Porter, and finally Reverend Porter's children  and grandchildren. Although H. Boone's estate included the trust corpus in his  taxable estate, the generation skipping trust would provide great tax advantage  to H. Boone by protecting the trust's corpus from taxation until the death of H.  Boone's great-grandchildren.


3
In order to create a "double generation skipping trust," one must comply with  the relevant tax laws, rules, and regulations. Here, the Ogden firm reviewed the  initial deed of trust drafted by the Bailey firm and made suggestions to ensure  compliance with the Internal Revenue Code ("IRC"). The Bailey firm made the  suggested changes. One of these changes created a provision permitting Reverend  Porter to assume a co-trustee position with the corporate trustee. Furthermore,  at some point during the revision of the deed of trust, paragraph 8 of the deed  of trust was drafted to state as follows:


4
8. The Trustee is authorized to pay, out of principal of the trust property,  to or for the benefit of any beneficiary who at the time is entitled to  receive income from the trust property, hospital, nursing, and medical expense  of any such beneficiary, and also such amounts as may be considered advisable  for the maintenance, support and welfare of any such beneficiary; but the  amount or amounts of any such payments shall be determined by the Trustee in  its sole discretion.


5
(Emphasis added). Plaintiffs complain that the inclusion of the word "welfare"  in the above paragraph has caused the "double generation skipping trust" to  fail.


6
Under current tax law, when a trust beneficiary holds a general power of  appointment, the trust corpus must be included in his taxable estate. See I.R.C.   2041(a)(2). A trust beneficiary has a "general power of appointment" if he has  the power to distribute the corpus to himself as a beneficiary, except if the  trust limits this power "by an ascertainable standard relating to the health,  education, support or maintenance" of the beneficiary. See I.R.C.  2041(b)(1).  According to Treasury Regulation  20.2041-1(c)(2), "[a] power to use property  for the comfort, welfare or happiness of the holder of the power is not limited  by the requisite standard." Thus, a provision in a trust instrument which allows  for the paying out of the corpus to the beneficiary for his or her welfare is  not limited and is treated as a general power of appointment. As a result, the  Trustees believe that, upon the death of Reverend Porter, the trust corpus may  be included in his estate for tax purposes because the deed of trust permits  Reverend Porter to distribute funds for his welfare.


7
Reverend Porter discovered this potential problem in 1990 and attempted to  remedy it. Reverend Porter's law firm informed him that federal tax law examines  state law to determine whether the word "welfare" has an ascertainable standard.  At that time, Florida law was unsettled as to the meaning of the word "welfare."  In order to ensure favorable treatment under Florida law, Reverend Porter  lobbied the Florida Legislature to change the law. He succeeded and the Florida  Legislature changed the law so that the inclusion of the word "welfare" in a  Florida trust instrument does not give the trustee the ability to do more than  disperse limited amounts of the corpus, thereby complying with the limiting  requirements of the tax laws.


8
After the change in Florida law, Reverend Porter hired the law firm of Miller &  Chevalier to request a private letter ruling from the Internal Revenue Service  ("IRS"). The law firm gave the IRS the facts of the case, including the changes  in the Florida law, and requested its opinion. In response, the IRS stated that  it would not find the trust to be a part of the Reverend's estate.2 See Priv.  Ltr. Rul. 9510065. Because this letter ruling depended on the recently enacted  Florida law, Reverend Porter took two other actions designed to ensure that the  trust would achieve the generation-skipping result even if Florida changed its  law. First, Reverend Porter succeeded in seeking a judicial reformation of the  trust instrument to remove the word "welfare" from Paragraph 8, on the ground  that the word's presence was a scrivener's error. Second, he sought another  private letter ruling from the IRS. In response to Reverend Porter's inquiry,  the IRS stated that the judicial reformation would not trigger any adverse tax  consequences. See Priv. Ltr. Rul. 199942016.


9
Subsequently, the Trustees of Reverend Porter's estate brought this legal  malpractice action to recover the costs expended in their efforts to avoid the  general power of appointment problem.3 The Trustees also sought a declaratory  judgment requiring the Defendants to indemnify the Trustees for any adverse tax  consequences resulting from the drafting error. In addition, the Trustees sought  punitive damages pursuant to Florida Stat.  768.72. On cross-motions for  summary judgment, the district court dismissed the Trustees' complaint without  prejudice on the ground that it was premature. The district court based its  order on the conclusion that under Florida law, a tort action does not commence  until damages have accrued, and that the Trustees have not suffered any damages  because the IRS has not attempted to levy an estate tax on the trust's corpus. In the same order, the district court affirmed the magistrate judge's order  permitting the Trustees to obtain confidential financial worth documents from  the Defendants in support of the Trustees' punitive damages claim. In a previous  order, the magistrate judge denied the Trustees' motion to compel answers to  deposition questions prompted by two letters between the Ogden firm and its  insurance carrier. On appeal, the Trustee's and Defendants challenge these  orders.

II. ISSUES

10
(1)Whether the district court erred in dismissing as not ripe the Trustees'  suit to recover the costs taken to avoid a potential consequence of  Defendants' alleged malpractice.


11
(2)Whether the magistrate judge erred in denying the Trustee's motion to  compel answers to deposition questions prompted by two letters between the  Ogden firm and its insurance carrier.


12
(3)Whether the district court erred in affirming the magistrate judge's order  permitting the Trustees to obtain confidential financial worth documents from  the Defendants in support of the Trustees' punitive damages claim.

III. STANDARDS OF REVIEW

13
This court reviews de novo a district court's determination that a case is not  ripe for determination. See Southeast Fla. Cable, Inc. v. Martin County, 173  F.3d 1332, 1335 n. 5 (11th Cir.1999). We review a district court's discovery  orders and evidentiary rulings for abuse of discretion. See Goulah v. Ford Motor  Co., 118 F.3d 1478, 1483 (11th Cir.1997).

IV. DISCUSSION

14
The Trustees argue that the district court erred in two respects. First, the  Trustees contend that expenses incurred to avoid the possible consequences of  the alleged malpractice constitute damages, thereby allowing their claim to  ripen.4 Second, the Trustees assert that the magistrate judge abused his  discretion by not requiring Defendants to answer certain deposition questions  prompted by two letters between the Ogden firm and its insurance carrier.  Defendants present one issue in their cross-appeal. They argue that the district  court erred in permitting the Trustees to obtain confidential financial  information from the Defendants in support of their punitive damages claim.

A.Ripeness

15
Under Florida law, "[g]enerally, a cause of action for negligence does not  accrue until the existence of a redressable harm or injury has been established  and the injured party knows or should know of either the injury or the negligent  act." Peat, Marwick, Mitchell & Co. v. Lane, 565 So.2d 1323, 1325 (Fla.1990).  When a plaintiff bases a malpractice action on errors committed in the course of  litigation, and the litigation proceeds to judgment, the redressable harm is not  established until final judgment is rendered. See Silvestrone v. Edell, 721  So.2d 1173, 1175 (Fla.1998). The present case, however, does not involve  litigation malpractice, but transactional malpractice. The district court  construed Florida law as stating that in a transactional malpractice case,  redressable harm is not established until the documents or legal items fail to  achieve their designated purpose.


16
The district court, however, misconstrued Florida law. Instead of setting a  fine-line, Florida courts hold that a malpractice action accrues when "it is  reasonably clear that the client has actually suffered some damage from legal  advice or services." See Throneburg, III v. Boose, Casey, Ciklin, Lubitz,  Martens, McBane & O'Connell, P.A., 659 So.2d 1134, 1136 (Fla.App. 4 District  1995). The district court correctly noted that most of the Florida cases hold  that the cause of action in issue does not accrue until a court holds that the  documents or legal items failed to achieve their designated purpose. Those cases  are distinguishable from the case at bar, however, because in those cases, no  concrete injury arose until a final court decision. In contrast, here the  Trustees have suffered a concrete injury as to the expenses they incurred to  remedy the alleged malpractice.


17
For example, in Peat, Marwick, 565 So.2d 1323, the Lanes claimed some deductions  based on their accountants' recommendations for which the IRS subsequently  issued a notice of deficiency challenging the claimed deductions. Following  Peat, Marwick's advice, the Lanes challenged the determination in tax court, but  ultimately agreed to an entry of a stipulated order which required them to pay a  tax deficiency. As a result, the Lanes filed a malpractice suit against Peat,  Marwick, who raised a statute of limitations defense. The Florida Supreme Court  held that the Lanes' cause of action did not accrue when they received the IRS  deficiency notice because the Lanes challenged the notice and, thus, did not  suffer any injury at that time. See Peat, Marwick, 565 So.2d at 1326. Instead,  the Florida Supreme Court held that the injury arose when the tax court entered  judgment against the Lanes who in turn had a legal obligation to pay the tax  deficiency. See id. at 1327.


18
Similarly, in Throneburg, the court held that a claim against an attorney for  failure to amend properly a declaration of covenants on property did not accrue  merely because the association thought the amendment ineffective. See 659 So.2d  at 1136. Instead, the court held that the claim accrued when a state court ruled  that the amendment was invalid in an action involving the same association and a  different owner. See id.


19
Both Throneburg and Peat, Marwick "draw a distinction between knowledge of  actual harm from legal malpractice and knowledge of potential harm." Id. In both  cases, the plaintiffs followed the advice of the defendant professionals, even  though others thought that the advice was wrong. Because they followed the  incorrect advice, the harm did not become an actuality until a court rendered a  judgment holding that the legal instruments failed to fulfill their purpose. In  contrast, the Trustees here did not follow the advice of the Defendants, and  instead, took steps to cure the potential problem prior to any IRS action or any  court determination. By attempting to mitigate the potential problem, the  Trustees realized an actual harm-the cost of remedying the potential  malpractice.


20
Moreover, the Florida case of Coble v. Aronson, 647 So.2d 968 (Fla.App. 4  Dist.1994), supports this conclusion. In Coble, a law firm incorrectly prepared  notes that were part of a sales agreement. The law firm's client sued for  reformation of the contract and the case settled. In turn, the client sued the  law firm for malpractice. The court stated that a cause of action had accrued  even though the client had settled the reformation case because the existence of  a redressable harm did not depend upon the outcome of the litigation. See id. at  970-71. Instead, the court found that the negligent preparation of the notes  "could potentially be the cause of redressable harm or financial loss to [the  client], especially in the nature of costs and attorney's fees." Id. at 971.  Similarly, the redressable harm in the present case need not depend upon the  outcome of any litigation because the negligent preparation of the will could  potentially be the cause of the financial loss that the Trustees incurred in  reforming the trust. Thus, we hold that the district court erred in dismissing  the case as premature.5


21
Of course, the Trustees' task of proving malpractice and proving that the  malpractice proximately caused the loss may be difficult because the Trustees  cured the problem prior to any indication from the IRS that the trust would  fail. However, we need not address these causation issues, since the district  court did not address them. See Singleton v. Wulff, 428 U.S. 106, 96 S.Ct. 2868,  49 L.Ed.2d 826 ("It is the general rule, of course, that a federal appellate  court does not consider an issue not passed upon below.").

B.Discovery of Letters

22
Likewise, we need not address the issue of whether the magistrate judge erred in  denying the Trustee's motion to compel because the district court did not  address this issue. See id. Although the Trustees timely filed a Fed.R.Civ.P. 72  objection to the magistrate judge's ruling, the district court dismissed the  complaint before ruling on the objection. Accordingly, we decline to consider  this issue for the first time on appeal. See id.; see also Fed.R.Civ.P. 72(a).

C.Discovery of Financial Worth Documents

23
Finally, the Defendants argue that the district court erred in affirming the  magistrate judge's order permitting the Trustees to obtain confidential  financial worth documents from the Defendants in support of the Trustees'  punitive damages claim. First, Defendants argue that the magistrate failed to  make an affirmative finding that a reasonable basis existed for the Trustees'  punitive damages claim as required by Florida Stat.  768.72. However, after  reviewing the record, we are persuaded otherwise. Second, the Defendants argue  that the Trustees failed to establish a reasonable basis because they did not  allege any facts outside of the complaint and, alternatively, did not allege  sufficient facts to support a punitive damages claim. We disagree.


24
This court has held that the pleading rules set forth in Fed.R.Civ.P. 8(a)(3)  preempt  768.72's requirement that a plaintiff must obtain leave from the court  before including a prayer for punitive damages. See Cohen v. Office Depot, Inc.,  184 F.3d 1292, 1299 (11th Cir.1999), vacated in part, 204 F.3d 1069 (11th  Cir.2000). However,  768.72 also has a discovery component which states that  "[n]o discovery of financial worth shall proceed until after the pleading  concerning punitive damages is permitted." Fla. Stat.  768.72. Prior to  allowing discovery of financial net worth information, Defendants argue that   768.72 requires a plaintiff who has made a claim for punitive damages to produce  evidence or make a proffer of evidence that shows a reasonable basis for the  punitive damages claim. This court, in Cohen, did not decide whether or not  federal discovery rules preempt this rule. Likewise, we need not answer this  question here because the record indicates that the Trustees made a proffer of  evidence that reasonably supports their claim.


25
The Florida courts do not require a fact intensive investigation into the  merits. Instead, the Florida courts entertain the punitive damage issue by way  of a motion to dismiss or a motion to strike, not a summary judgment motion. See  Will v. Systems Eng'g Consultants, Inc., 554 So.2d 591, 592 (Fla.App. 3  Dist.1989); see also Solis v. Calvo, 689 So.2d 366 (Fla.App. 3 Dist.1997)  ("Pursuant to Florida Statute section 768.72 (1995), a punitive damage claim can  be supported by a proffer of evidence. A formal evidentiary hearing is not  mandated by the statute."). Under Florida law, merely setting forth conclusory  allegations in the complaint is insufficient to entitle a claimant to recover  punitive damages. See T.W.M. v. American Medical Sys., Inc., 886 F.Supp. 842,  845 (N.D.Fla.1995); Bankest Imports, Inc. v. ISCA Corp., 717 F.Supp. 1537,  1542-43 (S.D.Fla.1989). Instead, a plaintiff must plead specific acts committed  by a defendant. See Bankest Imports, 717 F.Supp. at 1542-43.


26
Applying these legal standards, the magistrate judge found that the Trustees  pled and proffered evidence of specific acts committed by the Defendants that  provided a reasonable basis to support the Trustees' punitive damages claim. The  district court affirmed this finding. After reviewing the record, we see no  abuse of discretion in these rulings.

V. CONCLUSION

27
We hold that the district court incorrectly found that the Trustees' claim had  not accrued. The Plaintiffs have suffered losses in fixing the potential  problems with the trust. Thus, the Plaintiffs have suffered an injury.  Accordingly, we reverse that part of the district court's judgment. Next, we  decline to address whether the magistrate judge erred in denying the Trustees'  motion to compel because the district court did not address that issue. Finally,  we hold that the district court did not abuse its discretion in affirming the  magistrate judge's order permitting the Trustees to obtain confidential  financial worth documents. Therefore, we affirm that part of the district  court's judgment.6


28
AFFIRMED IN PART, REVERSED IN PART AND REMANDED.



NOTES:


1
 Hereinafter, we refer to the Bailey firm and the Ogden firm collectively as  "Defendants."


2
 A taxpayer ordinarily may rely upon a private letter ruling received from the  IRS. See 26 C.F.R.  601.201(l). Only in the rare and unusual circumstance will  the IRS revoke or modify a private letter ruling and retroactively apply the  change to the taxpayer who originally received the letter ruling. See 26 C.F.R.   601.201(l)(5).


3
 Reverend Porter died on June 5, 1999. The value of the Trust on that date was  approximately $55 million, which would yield a federal estate tax of  approximately $ 30 million if the corpus was included in Reverend Porter's  estate.


4
 Plaintiffs do not argue that the district court erred in dismissing their claim  for a declaratory judgment requiring the defendants to indemnify them for any  adverse tax consequences.


5
 The parties also discuss in their briefs whether the actions taken by the  Trustees were reasonable. The district court did not address the issue and the  record is not developed enough for us to do so either.


6
 All pending motions in this case are DENIED.


