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Did This Asbestos Litigation Firm Steal a Competitor's Client Files?

Last week, a former attorney at a major asbestos plaintiff's firm sued his former colleagues. Joseph C. Maher II made some pretty intense allegations of lawyerly espionage that one blogger called a combination of the “lawyering skullduggery of The Firm with the medical malpractice aspects of The King of Torts."

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When a person mentions high-powered asbestos litigation, most of the time you would assume that means lawsuits seeking damages for health problems caused by the infamous chemical.

Not this time. Right now, there is a war emerging between attorneys at one of the most prominent asbestos litigation law firms.

Last week, a former attorney at a major asbestos plaintiff’s firm sued his former colleagues. Joseph C. Maher II made some pretty intense allegations of lawyerly espionage that one blogger called a combination of the “lawyering skullduggery of The Firm with the medical malpractice aspects of The King of Torts.”

What is going on here? Is this the real deal, or just a disgruntled, laid-off lawyer?

Here is what the Wall Street Journal had to say about Maher’s lawsuit, filed last week in California:

A former attorney for Weitz & Luxenberg PC has filed a lawsuit against the major New York plaintiffs’ firm accusing it of possessing a cache of confidential files from a competitor that allegedly could be used to earn millions of dollars.

In the suit filed in California Superior Court, Joseph C. Maher II, the former head of Weitz & Luxenberg’s Los Angeles office, claims the firm had on its internal network a massive database of confidential client and legal files from Texas-based Waters & Kraus LLP. The two firms have offices across the nation and compete for clients who have asbestos-related and other claims.

The lawsuit, filed Wednesday, if true could highlight how after several-decades running asbestos litigation is still hotly competitive as well as lucrative for the handful of major firms that are full-time engaged in pursuing the claims.

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In his complaint, Maher says he discovered files on an easily accessible part of the firm’s computer network, where even the janitors could see them. He says he brought the problem to the attention of one of the founding partners, but was subsequently fired and given an “all encompassing… take it or leave it” severance package to keep him quiet.

For the firm’s part, they deny the accusations in no uncertain terms:

A spokeswoman for Weitz & Luxenberg called the allegations in the suit “completely false and filed by a disgruntled former employee who was terminated from the firm.”

Peter Kraus, a founding partner of Waters & Kraus, said, “We take very seriously our obligation to protect our clients’ confidences and will take whatever steps necessary to make sure their confidential information is protected.

As far as Waters & Kraus is concerned (they are not involved in the litigation), if the allegations turned out to be true, it would be evidence of the type of data breach that keeps information security experts awake at night. These are nightmare allegations:

According to Mr. Maher’s lawsuit, the files came into Weitz & Luxenberg’s possession after it hired attorney Benno Ashrafi from Waters & Kraus last year to help handle the influx of new asbestos and medical device claims into the Weitz firm’s Los Angeles office that Mr. Maher had opened in 2010.

Business was booming in the California office, the suit alleges, with Mr. Maher being “the number one filer of asbestos mesothelioma/lung cancer cases in the County of Los Angeles.” He estimates in the suit that his work would eventually bring in at least $50 million to the firm.

Mr. Maher claims that Mr. Ashrafi had taken the database from his old firm and at first kept it on an external hard drive but eventually uploaded it to the Weitz firm’s network where any of the firm’s nearly 400 employees could view it.

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No one should be able to walk off with his firm’s entire database of confidential client files. If this is happening, CHECK YOU ENCRYPTION. It is worth noting that Ashrafi was named in the lawsuit as well.

Either way it seems like there is a lot of fire here, and not nearly enough insulation.

Attorney Claims Firm Swiped Asbestos Files [Courthouse News]
Weitz Firm Got Rival’s Database, Suit Says [WSJ] (subscription required)
Maher v. Weitz & Luxenberg — Complaint [PDF]

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