February 1, 2018 / 9:02 PM / 23 days ago

Want of jurisdiction saves Willie Gary firm from explosive malpractice suit

(Reuters) - The self-described “giant killer” Willie Gary and his firm, Gary Williams Parenti Watson & Gary, will not have to defend themselves against allegations that they deliberately sabotaged a big antitrust and civil rights case brought by two ex-clients of the Gary firm.

On Wednesday, the 11th U.S. Circuit Court of Appeals affirmed the dismissal of a racketeering and malpractice suit by the Gary ex-clients, holding that the law firm’s occasional meetings in Georgia with the Georgia-based ex-clients were not enough contact with the state to give Georgia jurisdiction over the firm.

The 11th Circuit said in its unpublished, per curiam opinion that the mere mechanics of representing a client from a different state – occasional meetings, emails and phone calls – do not establish jurisdiction over the law firm in the clients’ hometown. Judges Stanley Marcus, Jill Pryor and Joel Dubina said they agreed with the 10th Circuit’s 2013 decision in Newsome v. Gallacher, in which the court found Oklahoma did not have jurisdiction over a Canadian law firm that conducted work in Canada on a Canadian parent company’s transfer of debt to its Oklahoma-based U.S. subsidiary.

The emerging consensus on jurisdiction over out-of-state law firms is undoubtedly a boon for lawyers who crisscross the country to represent clients: If they’re going to be sued by ex-clients, at least the case will be in their hometown or in the jurisdiction where they actually did the allegedly bad work.

Moreover, the jurisdictional restraint on forum-shopping in malpractice litigation can be more than a matter of convenience. Gary’s ex-clients sued him in Georgia because of its generous statute of limitations for fraud. Their time was already up in New York, where the underlying antitrust and civil rights case was tried.

It was a doozy of a case, as U.S. District Judge Amy Totenberg of Atlanta told the tale in her 2016 opinion dismissing the suit against the Gary firm. Concert promoters Leonard Rowe and Lee King, along with their companies, sued the William Morris Agency and many other talent and booking agencies in federal court in Manhattan, claiming that they systematically discriminated against black promoters.

Rowe and King reached an $8 million settlement with some of the smaller defendants. According to Rowe and King, William Morris offered to settle for $20 million but Gary supposedly told them not to accept the offer. Gary, according to Rowe and King, told them William Morris would cough up more than $1 billion to avoid bad publicity from the suit.

The smoking gun, Gary supposedly told Rowe and King, was a report from an e-discovery firm on a cache of William Morris emails that allegedly contained racist terms. But according to Rowe and King, Gary failed to submit admissible evidence on the emails. His firm hardly mentioned the supposedly decisive evidence in its opposition to the defendants’ motion for summary judgment – which the Gary firm filed late. In 2005, U.S. District Judge Robert Patterson of Manhattan granted summary judgment to William Morris and the other remaining defendants.

Rowe and King came to suspect that the Gary firm tanked the case. They theorized that Gary, whom they allege to have been in debt to high-interest lenders at the time of the William Morris litigation, wasn’t satisfied with the $4 million contingency fee he would have earned from a $20 million settlement with William Morris. As Judge Totenberg described their theory, “Gary conspired with counsel for (William Morris and CAA) to assure that the civil rights action would be dismissed in return for consideration far in excess of $4 million.” Judge Totenberg did not cite any evidence from Rowe and King’s complaint to back their theory, other than their recitation of other clients’ allegations of misconduct against the Gary firm.

Ultimately, the merits of their accusations were never tested. The Gary firm, represented by Kilpatrick Townsend & Stockton, raised a threshold jurisdictional defense. Rowe and King’s lawyers from the Griffith Firm and the Law Office of Linell Rowe said the men had strategy meetings about the New York litigation with Willie Gary in Georgia, including their first meeting with Gary about the case. Rowe and King argued that Georgia has a strong interest in protecting its citizens from fraud and malpractice.

That may be, the 11th Circuit said, but Georgia’s interest is no stronger than New York’s when it comes to resolving allegations of misconduct in New York courts. “The events and contacts giving rise to the litigation occurred, on the whole, in either New York or Florida,” the court said. “The (Georgia) contacts in this case demonstrate random or attenuated contacts within the state directly, all of which tie to ongoing litigation occurring in an out-of-state forum. For these reasons, we conclude that subjecting the Gary defendants to jurisdiction in Georgia would violate due process, and we thus affirm the district court’s dismissal of the action for lack of personal jurisdiction.”

I left messages for Edward Griffith, who represents Rowe and King, and for Gary counsel James Bogan of Kilpatrick. Neither got back to me.

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