In action by law firm seeking to recover legal fees on two client files taken by departing attorney from said law firm, Dist. Ct. erred in finding that law firm was entitled to 40% (instead of 10%) of $1.4 million in fees received by departing attorney based on $3.55 million settlement of products-liability lawsuit, where: (1) Dist. Ct. had failed to give adequate explanation to justify 40% figure; and (2) three witnesses gave unrebutted testimony that placed value of work done by law firm on lawsuit at 10%. However, Dist. Ct. did not err in rejecting departing attorney’s claim that law firm was not entitled to any fee (let alone $120,000 fee awarded by Dist. Ct.) for different products-liability claim, where: (1) Dist. Ct. found that law firm did essentially all of work on lawsuit prior to settlement of action by departing attorney at his new law firm; and (2) departing attorney failed to show how fact that law firm had previously settled case with one entity for $20,000 had decreased total recoveries from other entities on settlement negotiated by departing attorney. Dist. Ct. also erred in finding that with respect to instant fees that departing attorney owed to law firm, lien held by lender to law firm had priority to said fees over claims by victims of fraud committed by law firm, since provision in Indiana Code (section 30-4-3-22) gave priority to instant victims, where law firm committed breach of trust with respect to instant victims at time prior to when lender acquired its security interest to law firm’s proceeds.
Federal 7th Circuit Court
Civil Court
Attorney Fees