Duo files fourth
malpractice suit
against large firm
By Rick Brundrett
The two law firms couldn’t be much more opposite.
One is the third largest firm in South Carolina, with more than 160 lawyers at five offices in Columbia, Charleston, Greenville, Hilton Head Island and Myrtle Beach, plus two more in North Carolina.
Its gleaming downtown Columbia headquarters, housed in a bank skyscraper, sits kitty-corner to the S.C. Supreme Court with a view of the State House across the street. Founded in 1945, the firm represents some of the biggest corporations in South Carolina and the U.S.
The other firm is a two-man show based out of an older house in Columbia’s north downtown area, with a second office in Charleston.
The 11-year-old partnership has concentrated on commercial disputes and medical and professional malpractice cases. Its Web site proudly proclaims seven- and eight-figure verdicts and settlements obtained on behalf of unnamed clients.
But despite their outward differences, the Bland Richter and Nexsen Pruet firms are very well acquainted.
Over the past seven years, lawyers Eric S. Bland and Ronald L. “Ronnie” Richter Jr. have brought four legal malpractice suits against Nexsen Pruet. The latest action, Hughes and Seal Jet of the Carolinas, Inc., v. Nexsen Pruet, LLC, Mann and Klett, C.A. No. 08-CP-40-605, was filed Aug. 20 in Richland County.
The most recent suit claims that Nexsen Pruet gave bad legal advice to former business clients and compounded the problem by representing those clients after they were later sued.
Even more egregious, the latest suit alleges, was that the same two Nexsen Pruet lawyers repeated their mistakes shortly after a Richland County jury slapped them and their firm with a $5.5 million verdict in the earlier case, Robertson v. Nexsen Pruet Jacobs & Pollard, LLP, C.A. No. 04-CP-40-5531.
But the March 2006 verdict was on paper only, Nexsen Pruet contends in its Sept. 19 answer, pointing out it eventually settled the case without any admission of liability.
Nexsen Pruet likewise denies all of the allegations in the latest suit and has filed a counterclaim against the plaintiff in that case.
Nexsen Pruet has fired its own legal shots at Bland Richter. The firm is seeking sanctions against the two partners, claiming they violated a settlement agreement in another malpractice case, Myrick et al. v. Nexsen Pruet Jacobs Pollard & Robinson, LLP, and Robinson, C.A. No. 01-CP-10-225, by retaining a copy of Nexsen Pruet’s policy manual.
Bland and Richter contend that the retention was unintentional and that they notified Nexsen Pruet as soon as they discovered the manual.
The case, which involved allegations that Nexsen Pruet had a conflict of interest when it represented competing parties in a commercial deal, was settled for $1,497,500, according to court documents Nexsen Pruet filed in its appeal.
The Myrick case went to the state Supreme Court, and in a Sept. 22 ruling (South Carolina Lawyers Weekly No. 010-143-08, 17 pages), a majority of the justices sided with Nexsen Pruet.
The high court remanded to the lower court, which had sided with Bland Richter, to determine the “amount of attorneys’ fees to be awarded to Nexsen Pruet under the settlement agreement, as well as the appropriate sanction for our finding of contempt” (see the Sept. 29, 2008, issue of South Carolina Lawyers Weekly).
‘Personal Animosity’
In an interview last month before the Supreme Court’s ruling, Nexsen Pruet chairman W. Leighton Lord III told South Carolina Lawyers Weekly he believes Bland and Richter bear “personal animosity” against his firm.
“In the last six years, we have been sued four times by the same two guys,” Lord said. “If we’re doing something bad, why is it that these two guys are the ones that sue us?
“I think they have a business model of suing big law firms,” he said.
Bland and Richter insist they are not singling out Nexsen Pruet.
“They’re just defendants,” Bland told South Carolina Lawyers Weekly before the Supreme Court ruling. “We have other legal malpractice cases against other firms, whether large or small. The fact is we have a small Bar in our state … and there are relatively few lawyers who do what we do.”
The attorney defending Nexsen Pruet in the latest suit is A. Camden Lewis, a longtime Columbia attorney whose firm advertises itself on its Web site as representing plaintiffs and defendants in legal malpractice cases.
“We have faith in him,” said Nexsen Pruet general counsel Susan P. “Susi” McWilliams.
Lesson Learned?
In the latest suit, Daniel Hughes contends that Nexsen Pruet attorney Michael A. Mann wrongly advised him in 2003 that he could use an expired trademark for his custom industrial seal company, Seal Jet of the Carolinas, Inc.
Hughes said he allowed Mann to file for the Seal Jet trademark. On Dec. 14, 2004, the U.S. Patent and Trademark Office granted the trademark to Hughes’ company.
But that move and subsequent bad advice by Mann and a Nexsen Pruet associate resulted in a September 2006 federal trademark-infringement suit against him and his company by Economos America, Inc., Hughes alleges in his complaint. Economos claimed that Hughes had breached a licensing agreement.
Hughes contends that when he went to Mann for advice about the federal suit, instead of instructing him that Nexsen Pruet would have a conflict of interest in representing him and referring him to outside counsel, Mann instead paired him up with William Young “Corky” Klett III to defend him in the suit. Klett is head of Nexsen Pruet’s intellectual property litigation division.
Hughes claims that Klett misrepresented his trial experience to him verbally and on the firm’s Web site, and never advised him that his “best” defense to the federal suit was good-faith reliance on advice of counsel.
Hughes contends Klett also failed to tell him that about five months earlier, a Richland County jury had returned a $5.508 million verdict against Nexsen Pruet, Mann and Klett for alleged similar behavior in a patent case, Robertson v. Nexsen Pruet Jacobs & Pollard. That case involved a commercial pecan-cracking machine (see the June 5, 2006, issue of South Carolina Lawyers Weekly).
In that suit, which was later settled following post-verdict appeals, plaintiff Frank Robertson claimed, among other things, that Mann wrongly advised him initially that one of the patents he was seeking from his former company was set to expire.
Robertson also contended that, after he was sued by his former company as the result of the erroneous advice, Klett failed to advise him of the good-faith-reliance-on-advice-of-counsel defense.
In the Hughes case, a federal judge in Atlanta in February 2007 granted a preliminary injunction to Economos, ordering that Hughes and his company immediately stop using the Seal Jet name and mark, and cease using the Seal Jet domain name on its Web site, according to the complaint.
Hughes contends the court order forced him into a settlement agreement with Economos, in which he agreed to quit using the trademark and “reconfigure” his company’s Web site. He noted the site was “a primary, if not the primary, source of the business revenues,” though he did not specify the amount of lost business.
Expert Witnesses
In an affidavit attached to Hughes’ complaint, longtime University of South Carolina legal ethics professor Gregory B. Adams said Nexsen Pruet, Mann and Klett violated a number of rules under the S.C. Rules of Professional Conduct.
The violations cited in the affidavit included failure to provide Hughes with “competent advice and representation”; making “false, misleading, deceptive and unfair communications” about “the firm and its lawyers and their services”; and continuing representation that was “burdened by [a] nonconsentable concurrent conflict of interest.”
Adams also testified as an expert witness against Nexsen Pruet in the earlier Robertson case.
“In my more than 30 years as a lawyer, law professor, and expert, I have never seen such a blatant, repetitious disregard for the public interest and the lawyers’ duties to clients as engaged in by Mann and Klett,” Adams said in his affidavit.
The complaint also includes affidavits from two longtime trademark attorneys criticizing Nexsen Pruet’s handling of the Hughes case.
One of them, Robert M. Ward of Simpsonville, an equity partner in the intellectual property firm of Myers & Kaplan, which has offices in Atlanta and Orlando, said in his affidavit that Nexsen Pruet, Mann and Klett “committed multiple breaches of the standard of care that attorneys, and particularly South Carolina attorneys specializing in the trademark law, owe to their clients.”
Hughes’ suit seeks unspecified actual and punitive damages, as well as an award of treble damages and attorney fees under the S.C. Unfair Trade Practices Act.
‘Fraught’ With Errors
Nexsen Pruet contends Hughes never told Mann initially that Economos was continuing to use the Seal Jet trademark.
Rather, Hughes’ general practice attorney, Brian Dumas, informed Mann that Economos had sold its business to Hughes’ company and returned to Europe, allowing its registration in the trademark to be cancelled, according to the answer.
Nexsen Pruet noted it didn’t know that Dumas had been disbarred in South Carolina from 1992-2002.
Nexsen Pruet also contends that, contrary to Hughes’ assertions in the complaint, Hughes provided affidavits after Economos filed the federal suit saying that Economos and its related businesses had quit using the Seal Jet name and mark.
Ultimately, Nexsen Pruet in its answer said it negotiated a “valuable” settlement for Hughes in the federal suit “worth tens of thousands of dollars.”
As for not telling Hughes about the $5.5 million verdict in the Robertson case, Nexsen Pruet claims it had “no duty to advise Hughes of the purported and defective jury verdict” for the following reasons:
* The 2006 trial was “fraught with improprieties and errors.”
* There was “never any verdict of any kind entered against the defendants in the previous action,” though Bland and Richter have “repeatedly mischaracterized the verdict as having been reduced to judgment in this case as well as on the Bland and Richter’s law firm Web site.”
* Bland and Richter understood their client would be required to elect a remedy immediately after the verdict. “This election of remedies is a well-settled principle of law which requires a plaintiff who has sought recovery under a number of different theories to elect a remedy and recover only once for any damages asserted.”
* The trial court ordered a new trial on the legal malpractice claims against Mann and Klett “after which everything was resolved through a confidential settlement.”
“The Robertson matter was confidentially settled with no admission (and express denial) of liability whatsoever by the defendants,” Nexsen Pruet said in its answer. “The complaint in this case goes far beyond the accepted bounds of civility, simplicity and breaches the requirement to be just.”
The firm alleges Bland and Richter went to the press after the $5.5 million verdict because they were “angry” that Nexsen Pruet had “exposed their breach of a prior confidential settlement” in the Myrick case.
In the end, Nexsen Pruet suggests in its answer that Hughes brought the legal malpractice action against the firm primarily because he wants to get out of paying his legal bill. Nexsen Pruet is countersuing Hughes for breach of contract, claiming he owes $58,736 — including accrued interest — on a $106,984 bill.
‘Very Good Lawyers’
Neither Nexsen Pruet’s chairman, Lord, nor the firm’s general counsel, McWilliams, would discuss details of the Hughes case with South Carolina Lawyers Weekly. But they defended Klett and Mann.
“We stand behind these lawyers,” McWilliams said. “Both are AV-rated by their peers. … But for the Robertson matter, I don’t believe either one of them had been sued [previously].”
“We’ve got a lot of very good lawyers who care very much about their clients and about their communities,” Lord said.
McWilliams noted the three malpractice suits brought by Bland and Richter prior to the Hughes case were settled without any admission of liability. She acknowledged, though, that “lawyers make mistakes, and sometimes Nexsen Pruet lawyers make mistakes.”
Bland and Richter declined to discuss details of any of the malpractice suits. But they say attorneys should be held accountable for mistakes that result in damages to their clients.
“We’re not mad at lawyers,” Richter said, “but there’s nothing that should distinguish a lawyer from any other litigant.”
Richter and Bland estimate that legal malpractice cases comprise about a third of their practice. They acknowledge those cases don’t make them popular with their colleagues. But they’re necessary, they contend.
“It will clean up the image that we have in the public,” Richter said. “Lawyers don’t have a good public image — that’s a given.”
Editor’s note: Besides writing for South Carolina Lawyers Weekly, Brundrett also is a staff writer with The State newspaper in Columbia. Questions or comments may be directed to him at rick.brundrett@gmail.com.
