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Dentons Preps for $10M Attorney Fee Dispute Trial

October 28, 2019 | Posted in : Fee Agreement / Fee Proposal, Fee Dispute, Fee Dispute Litigation / ADR, Unpaid Fees

A recent NLJ story by C. Ryan Barber, “Dentons Preps for Trial in $10M Fee Suit Against Republic of Guinea, reports that, more than five years after the law firm Dentons sued the Republic of Guinea, claiming the West African country had failed to pay more than $10 million in legal fees, a federal judge pressed the two sides to prepare for a trial in early 2020—and to consider the “pure economics” of a settlement.

At a hearing in Washington, U.S. District Judge Randolph Moss of the District of Columbia appeared eager to bring the fee dispute to a conclusion, suggesting that a bench trial begin early next year.  When a defense lawyer for Guinea, Schertler & Onorato partner David Dickieson, said complications with taking depositions in Europe could push the trial to the summer, Moss balked at the suggestion.  “That’s pretty far out,” Moss said.  “It seems we ought to be able to get that done in less than nine months,” he added.  Moss set an Oct. 16 deadline for Dickieson and Dentons’ lawyer, Williams & Connolly partner Ana Reyes, to propose a schedule for pretrial proceedings.

In the years-long dispute, Guinea has argued it should be protected against the lawsuit under the Foreign Sovereign Immunities Act, a federal law that establishes the circumstances under which foreign governments are shielded from litigation in U.S. courts.  The hearing came a month after Moss rejected Guinea’s latest bid to get the law firm’s claims dismissed.

In August 2017, Dickieson argued Guinea’s engagement letters with Dentons were invalid because they were signed by the country’s minister of mines, who lacked authority to approve public contracts. Under Guinean procurement law, only the minister of finance at the time, Kerfalla Yansané, would have had authority to approve the contract. (Yansane is now Guinea’s ambassador to the U.S.)

Dickieson said Dentons could not use the engagement letters to claim that its work for Guinea fell under the Foreign Sovereign Immunity Act’s exception for commercial activity.  In September, Moss denied Guinea’s request for summary judgment, ruling that there is “no dispute that Guinea requested and accepted extensive legal services from Dentons.”

The fee dispute stems from Guinea’s plans to develop large iron ore mines in the southeastern region of the country.  As part of that effort, known as the Simandou Project, Dentons was hired in 2012 to provide legal services in connection with the mining project and negotiations with one of its investors, Rio Tinto.  In its 2014 complaint, Dentons said its invoices totaled more than $12 million, but Guinea had only paid the firm $2 million.  Guinea has argued in a counterclaim against Dentons that the law firm charged “outrageously inflated” fees and failed to live up to its promise to obtain outside funding for its legal work.

Dickieson said Dentons had tucked language into the “fineprint” of its retainer agreements allowing it to seek payment from Guinea if it could not secure that third-party funding.  At one point, Moss urged the two sides to consider a settlement and the “pure economics” of avoiding further costs in a dispute over legal fees.  Dickieson said that attempts at a settlement have been complicated by the financial condition of Guinea, an impoverished country that was ravaged by the Ebola epidemic.