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Lawyer of the Day: Gary Cruciani Collects $8.8 Million Award from His Former Law Firm

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Everything’s bigger in Texas, including awards for lawyers who sue firms for making misleading promises during the wooing period.

Gary Cruciani sued asbestos litigation firm Baron & Budd and its managing partner Russell Budd in 2008, for luring him away from McKool Smith with “negligent and fraudulent misrepresentations,” according to a lengthy Texas Lawyer article:

Cruciani alleges Budd “completely misrepresented the compensation system at Baron & Budd and the upside that allegedly existed there,” and Budd showed his “greed” when he paid himself a $50 million bonus in December 2005, which was 75 percent of the firm’s bonus pool that year.

Note to partners with a wandering eye: If a firm describes its compensation system as “Hully Gully,” be wary. In addition to misrepresenting the firm’s compensation system, Budd also neglected to tell Cruciani that there was bad blood between him and co-founding partner Fred Baron.

After hearing a host of counterclaims during a six-week trial, the jury sided with Cruciani, and decided the lost income and the impact on his future earnings warranted a $8.8 million award.

According to the Dallas Observer, the local legal community was shocked by the size of the award. Why was it so big?

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From Robert Wilonsky at the Dallas Observer:

Word of the verdict, handed down just a couple of hours ago, has spread like spilled oil amongst local legal types: We found out about it after a few attorneys gave us a holy-cow heads-up. They were amazed not that Cruciani had won, but by the amount.

On its face, $9 million may seem massive, but Baron & Budd knocked Cruciani off a shareholder track at McKool Smith in 2006. Cruciani was a shareholder at McKool Smith when he departed. After a financially lackluster year at Baron & Budd, he left.

He’s now back at McKool Smith, but as a nonshareholder principal. One of the nation’s top IP litigation firms, we understand that PPP at McKool Smith is, well, Texas-sized, big.

Cruciani was pleased with the verdict. From the Texas Lawyer:

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“I feel vindicated. It was hard to stand up to a firm the size of Baron & Budd and have everything but the kitchen sink thrown at you,” Cruciani says. “I know what happened. I figured the jury would arrive at the right result, and I’m pleased that they did.”

Russell Budd and Baron & Budd were repped by Baker Botts and Vinson & Elkins, respectively. We talked to Cruciani’s attorney, Jim Hartnett Jr. of the Hartnett Law Firm in Dallas, about whether it was better in this case to have a smaller, more local law firm on the case.

“I think it resonated a bit with the jury that this was a David & Goliath type scenario,” said Hartnett (with a heavy Texan accent). “Though that’s not particularly true. I have a lot of trial experience.”

Budd & Baron certainly can’t be happy about having to pay out almost $9 million to Cruciani, but the firm is not hurting. According to Hartnett, they picked up a role in the BP litigation.

Gary Cruciani Wins Multimillion Dollar Jury Verdict Against Russell Budd, Baron & Budd [Texas Lawyer]
Former Baron & Budd Lawyer’s Battle With Firm Goes to Trial [Texas Lawyer]
Ex-Baron & Budd Lawyer Has About Nine Million Reasons to Be Happy He Sued Firm [Dallas Observer]
Ex-Baron & Budd Lawyer Awarded $8.8M for Firm’s Statements About Finances [ABA Journal]

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