Marquess’s point about adverse publicity has turned out to be prescient. On Wednesday morning, Debevoise’s erstwhile client, Candlewood Timber Group, filed an answer and counterclaims against Debevoise, seeking damages of $55 million. And some of Candlewood’s allegations about its former law firm aren’t very flattering.
First, some background. The dispute between Debevoise and Candlewood arose from a 2003 breach-of-contract case Candlewood filed in Delaware Superior Court against Pan American Energy. Candlewood retained Debevoise & Plimpton after it brought the case. But about eight months later, with trial only two months away, Candlewood became unhappy with Debevoise’s work and brought in Susman Godfrey to try the case, with Debevoise staying on in a secondary role. The father-and-son duo of Stephen Susman and Harry Susman tried the case to verdict in 2006. (Pan American was represented by Squire, Sanders & Dempsey and Morris, Nichols, Arsht & Tunnell.) Before the verdict became public, Candlewood and Pan American reached a confidential settlement.
Candlewood now asserts that Debevoise made critical errors, missed major points, and billed excessively for the work of inexperienced lawyers. The firm’s deficiencies, according to Candlewood, forced the company to accept less in a settlement than it should have. The company’s counterclaim contrasts Debevoise with Candlewood’s Delaware counsel–Bouchard, Margules & Friedlander—which successfully represented the company for two-and-half years at a total cost of $450,000. “Over a 10-month pertrial and trial period–during which time D&P had the assistance of BM&F and later Susman–D&P managed to bill for more than 15,000 hours, the equivalent of 10 lawyers working full-time for the ten-month period,” Candlewood’s counterclaim alleges.
According to Candlewood’s lawyer in the Debevoise case, Robert Chan of Ferber Chan Essner & Coller, Susman Godfrey used only three lawyers at the trial in Delaware, in comparison to Debevoise’s heavy staffing. “Almost nothing Debevoise did saw the light of day at trial,” Chan told us.
In a statement provided to us by Debevoise’s lawyer, solo practitioner Roger Bernstein, the firm said that the settlement Candlewood received in the Delaware case was “far in excess of the value of the asset in dispute” and that Candlewood could have done even better had it allowed the jury verdict to be entered. “We took over a challenging case and provided legal services of the highest quality, contributing to a successful outcome and a substantial recovery for Candlewood,” said Debevoise presiding partner Martin Frederic Evans in the statement. “We’ve tried negotiation, mediation, and compromise to resolve this dispute. It is disappointing to be faced with a party, to whom we provided superior service with a successful outcome, who has chosen to raise baseless objections and now, belatedly, specious counterclaims in an effort to avoid its obligations.”