Biglaw

Why Was Sidley Working With A Con Artist?

Sidley's client is in jail, and they're being sued for what he did.

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GettyImages-86439718We touched on this in Morning Docket, but it bears some further exploration. Because top-flight Biglaw firms usually aren’t named in fraud complaints for allegedly aiding and abetting a now-imprisoned con artist.

And yet here we are.

The complaint, filed in October, names Sidley Austin and partner Edward McNicholas, alleging that they assisted one Joseph Garcia in securing millions in investments from a woman named Carrie Birkel. Birkel is looking to recover $1.5 million from the lawyers. Birkel claims that she had millions to invest after she got her $10 million divorce settlement — a divorce precipitated by Garcia providing her, unsolicited, with compromising photos of her husband, before introducing her to McNicholas, who vetted divorce lawyers for her on a $25,000 retainer.

As the complaint states:

Birkel’s claims arise out of a truly bizarre set of circumstances that would seem more appropriate for an episode of “Law and Order” than in reality.

Indeed.

Garcia, who is serving a 37-month sentence for similar activity, is a curious character by all accounts:

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Garcia and his wife used multiple aliases to go along with numerous Social Security numbers. While peddling phony investments, Garcia would only reference his time as a Navy SEAL; the details were confidential. And he instructed his family to always have “go bags” packed should they need to flee one of the many lavish homes they rented across the country.

Not exactly the sort of guy you usually find working with a major law firm. Usually the con men working with a firm of this caliber at least have words like “Goldman” or “Fargo” on their business cards. That said, firms can find themselves in one-off representations of almost anyone. And yet Roy Strom of Am Law Daily notes that Garcia’s relationship with Sidley might be bigger than that:

Sidley declined to comment about the firm’s alleged work for Garcia. But court documents and testimony by Garcia’s former accountant indicate the relationship between the con man and the Chicago-based Am Law 100 firm were not limited to Birkel’s case.

How does a firm get so mixed up with somebody like this that they work with him on an ongoing basis? Well…

According to testimony by his former accountant in his criminal case, Garcia had “24-7” access to Sidley’s offices after the accountant said Garcia spent “several weeks” counseling the firm’s clients on data security issues.

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This claim may not explain how the relationship got initiated, but this does offer a clue into how the relationship flourished. Taking the view most charitable to the firm — and the firm contends that allegations of wrongdoing on their part are “utterly without merit” — it would seem that the firm got taken in by a slick-talking cybersecurity consultant and never saw any need to question him on the work sent their way. It’s a sobering reminder that the world of cybersecurity is populated with white hats and black hats and sometimes the bad guys can dupe you.

At least that’s one theory based on the documents and testimony out there (mostly from Garcia’s criminal case). If this case moves forward we’ll hear what Sidley has to say — though they’ve asked to move the case to arbitration, so a veil could easily descend over this.

(The full complaint is available on the next page…)

Sidley Fights Fraud Suit Over Alleged Ties to Imprisoned Con Man [Am Law Daily]

HeadshotJoe Patrice is an editor at Above the Law and co-host of Thinking Like A Lawyer. Feel free to email any tips, questions, or comments. Follow him on Twitter if you’re interested in law, politics, and a healthy dose of college sports news.

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