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Law.com Home > Firm Sues Ex-Counsel for Fraud

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Firm Sues Ex-Counsel for Fraud

By Anthony Lin All Articles 

New York Law Journal

September 12, 2008

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A New York law firm is waging an unusual fraud suit against a former counsel who allegedly ran up charges on behalf of a company he was planning to join as general counsel.

Matthew C. Browndorf worked at 21-lawyer Cohen Tauber Spievack & Wagner for just 54 days between June and August 2006. He then joined a Newport Beach, Calif.-based company called Carlton Carrera Inc. as general counsel.

In a lawsuit filed in March 2007, Cohen Tauber accused Browndorf of misleading it about his intentions. The firm said it hired Browndorf, who had previously been a counsel at Edwards Angell Palmer & Dodge and an associate at Bryan Cave, based on his claim that he could originate $500,000 in annual business.

Browndorf, whose pay at the firm comprised a $175,000 base salary and a $50,000 bonus contingent on business origination, allegedly touted Carlton Carrera as a client capable of bringing $500,000 in annual billings to the firm. The firm claims Browndorf secretly joined the company at the same time he was assigning other Cohen Tauber lawyers to work for Carlton Carrera.

Cohen Tauber states in its complaint: "Browndorf concealed the fact that he had accepted employment with Carlton Carrera so that he could continue collecting a salary and other payments from [Cohen Tauber] while, at the same time, obtain legal services from [Cohen Tauber] for the benefit of his new employer, Carlton Carrera."

The firm said Browndorf knew Carlton Carrera would not pay the bills submitted by Cohen Tauber, which totaled $87,000. The firm claims other damages relating to Browndorf's stint, including salary. Cohen Tauber noted that Browndorf charged to the firm business trips to California as well as an expensive dinner and strip club visit with Joseph Porche, president of Carlton Carrera.

Browndorf has counterclaimed for attorney fees, claiming he acted properly within the scope of his employment at Cohen Tauber and that he had no responsibility for Carlton Carrera's debts. He called Cohen Tauber's claims "oppressive and frivolous." The lawyer for Browndorf, Gareth W. Stewart of Manhattan, did not return a call seeking comment.

The firm also has sued Carlton Carrera. Last week, Southern District of New York Judge Thomas P. Griesa denied the company's move to dismiss the case for lack of jurisdiction or transfer it to California. The judge said Cohen Tauber had adequately alleged that Browndorf had acted as a New York agent for Carlton Carrera.

Judge Griesa rejected the company's argument that it was impossible for Browndorf to have been an agent for Carlton Carrera while working at Cohen Tauber.

"There is no merit to this argument," the judge said in Cohen Tauber Spievack & Wagner v. Carlton Carrera Inc., 07 cv. 2356. "An agent can have more than one principal, and it has surely happened that a partner or employee of a law firm can occupy a role as counsel for a company in such a way as to make him an agent of the company."

Carlton Carrera's lawyer, Stuart Miller of Wellman & Warren in Laguna Hills, Calif., did not return a call for comment.

Cohen Tauber appeared pro se.

It is unclear what kind of business Carlton Carrera is or whether it is presently in operation. A Web site for the company is not functioning. Browndorf presently heads an investment management firm and continues to practice law as a solo practitioner.



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Firms mentioned

    
  • Edwards Angell Palmer & Dodge
  • Bryan Cave

Companies, agencies mentioned

    
  • Cohen Tauber Spievack & Wagner
  • Wellman & Warren

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