Which Biglaw Firm Just Got Hit With A $200 Million Malpractice Verdict?

Everything's bigger in Texas -- including the malpractice verdicts.

Everything is bigger in Texas, it seems — and that includes the jury verdicts against Biglaw firms in malpractice cases.

As we mentioned last night, a jury in Harris County recently ruled against Andrews Kurth in a malpractice lawsuit brought by Scott D. Martin, a former client. According to Brian Mahany of Mahany Law, who first reported the news, it’s a giant verdict: approximately $200 million.

Including interest, it seems to exceed that sum. Several court documents — the motion for entry of judgment, the jury charge and verdict sheet, the proposed judgment — are collected here. The proposed order seeks an award of more than $196 million in actual damages, $20.7 million in prejudgment interest, and an additional sum, to be determined, in postjudgment interest. Yikes.

What were the allegations against Andrews Kurth? Here’s some brief background:

Scott Martin filed his legal malpractice suit against the law firm in 2013. At the time, Scott was embroiled in a bitter family dispute with his brother Ruben. The dispute centered on management of a family owned business. When it appeared the two brothers were headed to court, their mother Margaret Martin attempted to mediate.

Ultimately a settlement proposal was drafted and signed by Ruben and Margaret. Scott claims that lawyers from Andrews Kurth reviewed the document on his behalf and assured him it would protect his interests. Relying on their legal advice, he signed the agreement. Unfortunately, Scott would soon find out the dispute was far from settled.

A few months later, Scott says his brother didn’t comply with the agreement’s terms. Scott then sued Ruben. Ultimately, Scott claims that a Texas appeals court ruled that the settlement agreement was nothing more than an “unenforceable agreement to agree.” After a flurry of almost one dozen collateral lawsuits, Scott sued his former lawyers, Andrews Kurth….

Specific allegations include a claim that internal firm emails mocked Scott and his “precarious financial condition.” While the firm billed him over $6 million for legal services, Scott claims the internal emails show the firm betrayed him and showed a shocking level of disrespect.

Yet another reminder to lawyers: be careful about what you say in those internal emails. You might view them as protected by attorney-client privilege, but if your client ends up suing you, the emails could be discoverable.

We received several tips about the verdict. One tipster told us that Andrews Kurth is “strangely silent” about the matter. “Supposedly it’s all covered by insurance, but insurance isn’t free and this is a big verdict,” said this source.

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We reached out to Andrews Kurth for comment. Managing partner Bob Jewell issued a statement: “We are disappointed and respectfully disagree with the jury’s verdict. We will remain committed to the post-verdict and appellate process and are confident that we will ultimately be vindicated.”

Jewell’s statement makes an important point: this case is far from over. Andrews Kurth might be rescued by the trial judge, in post-verdict motions, or by the appeals court if its loss sticks in the trial court.

We’ll continue to monitor this case. If you have any information to add, please feel free to contact us.

UPDATE (12/15/2015, 10:38 a.m.): Good news (perhaps) for Andrews Kurth: the judge has declined to enter final judgment (for now), instead ordering the parties back to mediation (sixth link).

UPDATE (3/4/2016): The case has been settled on confidential terms, according to Law360.

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Scott D. Martin v. Andrews Kurth LLP: Motion for Entry of Judgment [Harris County District Court]
BREAKING NEWS: Andrews Kurth Loses $200 Million Malpractice Claim [MahanyLaw]
Andrews Kurth Sued Over $3M Fees In Martin Midstream Row [Law360]

Earlier: Non-Sequiturs: 11.16.15