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Mixed Verdict For A Firm Accused by Carrie Johnson© Copyright 1998 Legal Times
The trial stretched out for nine weeks in D.C. Superior Court, rivaling the Herbert Haft family saga as the longest civil case in the court's recent history. Seven lawyers generated more than 500 exhibits and 82 pages of jury instructions. By the time the courtroom finally cleared last week, the Cleveland-based megafirm of Baker & Hostetler had been ordered to pay $250,000 to a former client.
In its April 29 verdict, a jury found that the firm had breached its fiduciary duty and its contract with Sporicidin, a troubled Rockville, Md., company that manufactured chemical solutions before it was essentially shut down by three government agencies in late 1991.
The protracted case aired a series of disagreements centering around the costs and the quality of representation that lawyers from Baker & Hostetler's D.C. office provided to their demanding client during a 16-month period. John Toothman, an Alexandria, Va.-based lawyer and lead counsel for Sporicidin, says that the verdict was a clear indication that the firm overbilled the client for substandard legal work.
"It substantially vindicates what the client's been saying," says Toothman, who argued that Baker & Hostetler lawyers had put 53 lawyers and other staffers on the matter, only to botch its case with government regulators. "Getting the $250,000, even though it's less than we hoped for, is a very substantial amount." ...
[T]he prospect of paying out a quarter of a million dollars and living with a jury's finding that it breached its fiduciary duty is no easy pill for Baker & Hostetler to swallow, especially since jurors weren't required to spell out exactly what it is they think the Baker lawyers did wrong. ...
Toothman, on behalf of Sporicidin, contended at trial that in addition to the over-billing, other Baker & Hostetler lawyers had represented two of Sporicidin's competitors, creating a conflict of interest, and that one Baker attorney had revealed a client confidence in the course of the representation, among other things. Any or all of these actions could be grounds for a finding of breach of fiduciary duty. ...
In retrospect, it seems that nothing about Baker & Hostetler's involvement with Sporicidin was ordinary. (See "Baker & Hostetler in Fee Fight." September 1, 1997, Page One.) ...
Robert Pinco and Donald Segal, now partners in the D.C. office of Akin, Gump, Strauss, Hauer & Feld; Marshall Lee Miller, now a name partner at D.C.'s Baise & Miller, and Baker & Hostetler partners Lee Simowitz, Richard Hauser, and Richard Leon were singled out by Sporicidin as being the top six lawyers who charged time to the company during its regulatory crisis. ...
Toothman brought in a lawyer and a paralegal from his firm to help try the case and also called on Francis Carter, a partner at D.C.'s Carter & Varrone. Carter was most recently in the news as the attorney who formerly represented White House intern Monica Lewinsky.
Together, the group compiled 536 exhibits and called 22 current and former Baker & Hostetler personnel to the stand. Toothman, who also operates a legal-fee auditing service, hammered away at the fact that 53 Baker lawyers and staffers billed time to his client. ...