Counsel Concerns: Lawyers Battle Over Gears of War Client

Philadelphia, PA, lawyer Bruce Chasan, who is suing the founder of a fast-growing litigation boutique over a purported fee-sharing settlement, is arguing that the boutique backed out of the settlement so it could fund other cases against video game makers.

In a memo filed in February in Chasan v. Pierce, 2:2018cv05399 (E.D.Pa.), Chasan argued that the ex-client in question, former pro footballer and wrestler Lenwood Hamilton, did not need to sign off on his agreement with litigator John Pierce of Pierce Bainbridge Beck Price & Hecht for a previously discussed $160,000 settlement to be binding. Chasan alleged in the memo filing that Pierce derailed the settlement so his firm could fund other cases.

“So it appears that the $160,000 set aside for the settlement with plaintiffs in September 2018 is instead being used by PBBPH Law as seed money to pay numerous 20-something video game players to launch and accelerate a cottage industry of multiple lawsuits against the video game industry,” Chasan's filing said.

Pierce Bainbridge, reached for comment, said in a statement that it will continue to oppose Chasan's claims. “Mr. Chasan all but admits in his opposition that the parties were still in the midst of negotiating a settlement and never executed an enforceable agreement. Mr. Chasan's speculation about Pierce Bainbridge and its motives is nothing but a red herring, and his brief betrays that his personal greed trumps his relationships with clients and former clients,” the statement said.

Chasan argued that Pierce and his firm agreed to pay the settlement amount by presenting a draft agreement in October. “In effect, Pierce and PBBPH Law expressly exhibited an intent to be bound even if Hamilton did not agree to release the Chasan parties,” Chasan's memo said.

Chasan represented Hamilton beginning in late 2016, and jointly represented him with Pierce for a short time last year, until Hamilton terminated Chasan from the case. According to Chasan, Pierce was first introduced to the case because Chasan was seeking third-party funding sources for the litigation. In the ongoing case, Hamilton is suing Epic Games, Lester Speight and Microsoft, alleging that his likeness and voice were used in the video game Gears of War. Hamilton v. Speight, 2:2017cv00169 (E.D.Pa.).

According to Chasan's complaint, his representation of Hamilton was intended to be on a contingent fee basis, except that Hamilton would be required to pay Chasan $450 per hour if he terminated the representation before the underlying litigation resolved. Based on that amount, Chasan emailed Pierce after being terminated from the case to request $320,000 in fees. After negotiating for several months, Chasan has alleged, he and Pierce agreed to a $160,000 settlement.

In his motion to dismiss, Pierce acknowledged that his firm engaged in settlement negotiations with Chasan for seven months, but contends they never reached an enforceable settlement agreement.

In his memo opposing the motion to dismiss, Chasan cited a Sept. 15 email from Pierce that said in regard to the $160,000 amount: “Carolynn/Jim, please work with Bruce to wrap this up swiftly.”

“This outward assurance by Pierce was a reaffirmation that a contract had been made,” Chasan's memo said. After that, on Sept. 20 Jim Bainbridge emailed Chasan suggestions for the settlement agreement and Chasan replied that he was fine with those changes.

A sticking point in the settlement discussions, according to court filings, was Hamilton's refusal to release Chasan from claims. In his opposition memo, Chasan said in a footnote that Hamilton was not intended to be a party in the suit he contemplated filing against Pierce and his firm last year. Chasan contends in his memo that he considered Hamilton's potential claims against him to be meritless and he was willing to go ahead with the $160,000 settlement.

“The condition for Hamilton's consent seems to be a unilateral invention of Pierce to provide himself and PBBPH Law an escape hatch in the event they had a change of mind,” Chasan's filing alleged.

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Lizzy McLellan writes about the Pennsylvania legal community and the business of law at firms of all sizes. Contact her at [email protected]. On Twitter: @LizzyMcLell.