The Hotel Del Coronado in San Diego has hosted a long list of dignitaries, including 11 U.S. presidents and royalty from at least ten countries. San Diego's "beacon of grandeur and refinement," a seaside resort and a National Historic Landmark, also was scheduled to welcome the partners of Akin Gump Strauss Hauer & Feld in April. But, given tough times, the firm canceled its partner retreat. Now, The Del is suing.
The famed hotel filed a breach of contract suit against Akin Gump last week, which we read about on CourthouseNews, claiming it is entitled to $385,950 in liquidated damages for, among other things, "877 sleeping room nights" that were set aside for partners at the firm.
The lawsuit further states that, "On or about January 30, 2009, the hotel made demand upon Akin Gump for a cancellation fee"; that demand has essentially been ignored.
Firm administrators disputed the assertion that they have ignored the hotel, and, before learning of the lawsuit this week, said they were under the impression negotiations to settle the dispute were ongoing.
"I got on a plane and flew cross country to start negotiations face to face," says James Leary, Akin Gump's Washington, D.C.-based executive director. "We are surprised and disappointed it has come to this point. We got no warning they decided to file a lawsuit."
Akin Gump chose The Del as the site of its 2009 partner retreat a couple of years ago. Leary says the plan was to break from the routine of holding the event in either Arizona or Florida.
But late last year, as the economy continued to skid, the firm decided it would be unseemly to gather firm partners at a luxury resort in southern California. Akin Gump hasn't been immune from the downturn; last month the firm laid off 65 staff members, and the partnership has seen a lot of movement.
A hotel spokeswoman declined to comment on the matter. John Josefsberg at Rudner Law Offices in Dallas is representing the hotel; he did not return a call and e-mail seeking comment about the lawsuit, which was filed in San Diego Superior Court on Feb. 11.
As a result of the economic downturn, companies and law firms are deciding, both for substantive and public relations reasons, to relocate or cancel off-site events and meetings.
Goldman Sachs Group Inc. moved a three-day conference that will take place next week from Las Vegas to San Francisco. Earlier this month, Wells Fargo & Co. canceled an employee recognition conference that also was scheduled to take place in Las Vegas. The moves came after the banks, both the recipients of federal bailout funds, were criticized for staging the events.
But it is not universally accepted that having meetings in a sunny vacation destination is now bad form. Last week, Sonnenschein Nath & Rosenthal held its annual partner retreat in Las Vegas.
Akin Gump is leaning towards a one-day meeting in the Washington, D.C., area to replace its retreat this year, according to Leary. But the firm might still be stuck with the bill for its California dreams.
This article first appeared on The Am Law Daily blog on AmericanLawyer.com.