Law Firms
Hotel Sues Akin Gump for Canceled Retreat
Posted Feb 20, 2009 9:01 AM CST
By Debra Cassens Weiss
A San Diego hotel has sued Akin Gump Strauss Hauer & Feld for canceling a planned April retreat.
The suit by the Hotel Del Coronado seeks $386,000 for “877 sleeping room nights” secured by the firm for the partner retreat, the American Lawyer reports.
The firm had chosen the San Diego site a couple years ago but canceled due to the economic downturn that caused it to lay off 65 staff members last month.
Akin Gump executive director James Leary told the American Lawyer he was surprised by the suit because he had been negotiating a resolution to the dispute.
"I got on a plane and flew cross country to start negotiations face to face," Leary told the publication. "We are surprised and disappointed it has come to this point. We got no warning they decided to file a lawsuit."
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Comments
Mike
Feb 20, 2009 9:25 AM CST
Why should a law firm like Akin Gump be treated differently from any other company? You order something, then you cancel because you ran out of money - and you expect your business partner to bear the risks that are, in fact, yours? Funny economics. The hotel is right to charge them.
Akin Gump had a choice to do the retreat anyway - welding together those who remain. They decided not to - it will not help them to create “glue” among those working for them, and they have to pay none the less. Wrong management decision. Made to not upset those who got fired - may be a legitimate goal, but too short sighted.
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IP Guy
Feb 20, 2009 10:03 AM CST
Law School 101: Mitigation of Damages
Did Akin give the hotel notice about the cancellation a reasonable amount of time before the event? Did they book up the entire hotel so the hotel turned away other events, bookings, etc.? What efforts did the hotel make to mitigate their damages?
That said, why couldn’t the partners have still held the event but with each individual partner paying their own way? Are they so unwilling to invest in Akin?
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B. Mcleod
Feb 20, 2009 11:51 AM CST
When you think of all the San Diego area service workers who have lost economic opportunities from the cancelation of these 877 sleeping room nights, it really is very sad.
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Ana
Feb 20, 2009 12:50 PM CST
wow this sounds like a first year contracts exam problem ...
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Fiona
Feb 20, 2009 1:13 PM CST
The economic effect is staggering:
Feb. 9 (Bloomberg)—Lawmakers are “killing” hotels that rely on corporate events by forcing companies that get federal money to scale back on employee trips, said James Tisch, the chief executive officer of Loews Corp.
“Congress has done a great job of killing the resort hotel business with the way they’ve criticized a number of financial firms for having conferences,” Tisch told analysts today. “I just heard this morning of another investor conference that was canceled by another major investment firm because of fear of being criticized by members of Congress.”
The trickle down to the maids, busboys, etc. who are losing their jobs is devastating.
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