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Attorneys Vying to Split $4.8M in Legal Fees

August 18, 2010 | Posted in : Billing Practices, Contingency Fees / POF, Fee Agreement, Fee Award, Fee Dispute, Fee Entitlement / Recoverability, Fee Issues on Appeal, Fee Reduction, Hourly Rates

A recent law.com story, “Fight Continues Over Split of $4.8 Million Fee in Dram Shop Case” reports that two law firms are fighting over nearly $5 million in legal fees in New Jersey.  The underlying case, Verni v. Lanzaro, is over a 1999 drunken-driving crashed that paralyzed Antonia Verni, then 2 years old.  The case ultimately settled for $25 million with $4.8 million designated for legal fees.  Since then, Rosemarie Arnold, whose firm originated the case, and David Mazie, who took it over and brought it to trial and settlement, have been vying over their share of the money.  Bergen County Superior Court Judge Robert Wilson set Arnold’s share at $227,500 leaving $4.6 million for Mazie.  In deciding the fee split, Wilson applied a clause from Arnold’s contingency fee agreement that required payment of hourly fees if the client chose to discontinue Arnold’s services. 

The appeals court said that Wilson had a basis for reducing the 2,500 Arnold claimed she spent on the case to 827 hours.  For example, Arnold claimed 400 hours for legal research, but the file did not contain a single memorandum, the appeals court said.  It reversed, however, because Wilson did not explain how he arrived at 827 hours.  The “drastic” size of the reduction “requires substantially more specific findings”, the appellate judges wrote.  Their unpublished opinion left it unclear whether the remand judge can jettison Wilson’s contract-based approach in favor of a quantum meruit analysis, as urged by Arnold.