Attorney Misconduct, Biglaw, Lawyer of the Day, Legal Ethics, Litigators, Small Law Firms

DLA Piper’s Revenge

Nobody puts DLA Piper in a corner. It’s the world’s new highest-grossing law firm, after all.

Were DLA Piper’s revenues enhanced by alleged overbilling of clients? A former client made that claim in a lawsuit, which the parties ultimately settled (but not before some bad PR for DLA).

Now one of the lawyers who was a thorn in DLA’s side finds himself in a prickly situation of his own. He’s up against the Biglaw behemoth yet again, pursuing a high-profile case that a judge just described as “reek[ing] of fraud and malfeasance”….

The lawyer is Larry Hutcher, name partner and head of litigation at Davidoff Hutcher & Citron. In a case of “what goes around comes around,” Hutcher is once again litigating against DLA, but this time Hutcher’s the one in trouble.

Hutcher represents the Sequoia Presidential Yacht Group, which owns the former presidential yacht Sequoia, and DLA Piper represents FE Partners LLC, which is trying to acquire the vessel. Here’s what is going on, according to the Associated Press:

The Sequoia group filed the lawsuit in February to prevent FE Partners LLC from exercising an option to purchase the yacht for $7.8 million under the default provisions of a loan provided by FE Partners. Sequoia claimed that FE Partners reneged on a $5 million loan agreement in a “dastardly” plan to take control of the historic vessel.

But faced with mounting questions about their conduct and the conduct of Gary Silversmith, head of the Sequoia ownership group, the plaintiffs’ attorneys recently threw in the towel and agreed to a default judgment in favor of FE Partners. [Vice Chancellor Sam] Glasscock recently rejected Sequoia’s request for continued confidential treatment of the default motion, suggesting that Sequoia was simply trying to avoid embarrassment over its alleged conduct.

What is the alleged conduct that Vice Chancellor Glasscock views as troublesome?

At a hearing Tuesday, Glasscock expressed particular scorn for the conduct of Sequoia attorney Larry Hutcher in deposing Michael Cantor, a principal of FE Partners. In the deposition, Hutcher asked if Cantor had told a former captain of the yacht that a criminal action had been filed against him in Delaware.

Attorneys for FE Partners said the question was a deliberate attempt to scare the former captain so he would not come to Delaware and offer damaging testimony against the Sequoia group. The former captain had been accused by Silversmith in a Washington police complaint of removing an item from the yacht, but no complaint was ever filed against him in Delaware.

In fairness, this doesn’t strike me as that bad; asking a deponent about a police complaint related to the yacht in question could be reasonable (although perhaps it’s more problematic in the complete context of the case, which I admittedly haven’t delved into).

I find the Davidoff Hutcher firm’s response to the allegations more troubling:

Hutcher did not appear for the hearing, but Malcolm Taub, a law firm colleague, said he was “saddened” by the allegations of misconduct and that their law firm did nothing wrong. Taub instead tried to blame [his client, Sequoia Group’s Gary] Silversmith.

“We forgot to tell him not to throw away his computer. We forgot to tell him not to destroy the hard drive,” Taub said sarcastically.

“You cannot rise above your clients,” he added. “When you sleep with dogs, sometimes you wake up with fleas, and I think that’s what happened.”

Larry Hutcher

Ouch. Much like sending emails urging colleagues to “churn that bill, baby,” comparing your own client to a flea-ridden dog doesn’t seem like a recipe for repeat business. As Gary Silversmith of Sequoia told the AP, “I’m not happy with people saying things, throwing me under the bus.”

What a mess. It probably won’t get Hutcher recognized again as the American Lawyer’s Litigator of the Week anytime soon.

As a consolation prize, we are happy to name Larry Hutcher as our Lawyer of the Day here at Above the Law. Congratulations!

UPDATE (8/29/2013, 4:30 p.m.): Vice Chancellor Glasscock just dismissed Sequoia’s complaint with prejudice. The dismissal order states that Gary Silversmith “fraudulently induced FE Partners to enter into the Loan Documents… through the use of fraudulent misinterpretations including the fabricated $20 million Gazprom offer letter.”

Delaware judge: Presidential yacht case ‘reeks of fraud’ [Delaware Online]
Litigator of the Week: Larry Hutcher of Davidoff Hutcher & Citron [Am Law Litigation Daily]

Earlier: Overbilling Gone Wild: Paying the (DLA) Piper
What Is The World’s New Top-Grossing Law Firm?

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