Ex-Client Claims Bryan Cave Wants to Give Up Fee Claim to Conceal Conflict
In an unusual twist, the law firm Bryan Cave is seeking to withdraw a request in bankruptcy court for the payment of nearly $282,000 in fees by a one-time client.
Lawyers for Bryan Cave say there is no ulterior motive for its decision to withdraw the request for fees from mortgage loan brokerage Estate Financial Inc., which sought bankruptcy protection in 2008, the Am Law Daily reports. But lawyers for the EFI estate allege Bryan Cave wants to drop the matter to hide evidence of a conflict of interest—its representation of EFI and an affiliate, Estate Financial Mortgage Fund.
Attorneys for EFI’s trustee also argue that withdrawal of the fee claim could possibly prejudice a $100 million malpractice suit filed by the bankruptcy estate against Bryan Cave, the Am Law Daily says. The suit argues Bryan Cave failed to advise EFI about the need to comply with securities laws, allowing investors who bought mortgage-backed securities to lose $100 million. Bryan Cave has said the allegations are without merit and they stem from events that took place before it was retained. It is seeking to move the malpractice suit out of bankruptcy court.
