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Judge Orders Lawyers to Give Up Attorney Fees
Daily Business Review
April 02, 2009
Retired Miami cruise ship injury lawyer Jerrold Wingate and former associate Peter Sotolongo have been ordered to return almost $450,000 in fees collected under a secret deal after Wingate withdrew from dozens of personal injury cases amid bribery allegations.
Miami-Dade Circuit Judge Herbert Stettin, who supervised Wingate's complex withdrawal, became aware of the agreement in January and held a contempt hearing.
The fee-splitting arrangement involved Wingate, Sotolongo and fellow Miami admiralty lawyer Brett Rivkind of Rivkind Pedraza & Margulies dividing the proceeds from 77 crew injury cases brought against Royal Caribbean Cruise Lines.
The origins of the secret fee arrangements stem from Royal Caribbean alleging in January 2008 that Wingate employees were paying off cruise line investigators in exchange for inside information about confidential settlement terms that were being considered by the company's lawyers. In the wake of that accusation, Wingate walked away from his case portfolio before Stettin could rule to disqualify him.
At the time, Wingate's cases against Royal Caribbean were deemed by many admiralty lawyers as an extremely valuable book of business. They were built atop the burgeoning admiralty practice of the late William Huggett, for whom Wingate worked. Huggett died in 2004.
Rivkind, Sotolongo and Wingate drew up the fee-splitting arrangement in February 2008, about a month after Wingate dropped his case portfolio, according to Stettin's order.
"I conclude that it is a secret, self-serving and illegal arrangement intended as a means of evading this court's order concerning Wingate's claim to fees and costs from files which he abandoned," Stettin wrote in an order issued late Monday.
The judge said there was no evidence to suggest that Rivkind had defied the court by entering into a fee arrangement that Stettin had barred.
"We're delighted that Judge Stettin made the express finding that the Rivkind law firm did not engage in any conduct in violation of a court order, and we're delighted that the judge did not find Mr. Rivkind in contempt," said Rivkind's attorney, Herman Russomanno of Russomanno & Borello in Miami.
But the judge slammed Sotolongo. Stettin wrote that the lawyer's "misconduct was compounded by his false, misleading testimony" during a Jan. 15 deposition.
During the deposition, Sotolongo estimated he received about $20,000 under the fee-splitting arrangement. But Stettin concluded the actual amount was about $114,000 after he examined fee agreement contracts in 27 cases. The judge on Tuesday ordered the attorneys to send their fees to the court clerk's office.
"The disparity is too large to suggest it was simply a memory lapse," the judge wrote. "Sotolongo's lack of candor is not attributable to simple negligence or a bad memory."
The judge held Sotolongo, who was Wingate's associate, and Wingate in contempt. Stettin noted he was referring the matter to the Florida Bar for investigation.
Sotolongo's attorney, Randy Brombacher, a partner with Saavedra Pelosi Goodwin & Hermann in Fort Lauderdale, Fla., said he would appeal Stettin's contempt order but declined further comment.
The judge did conclude Rivkind, who took on the bulk of the cases Wingate left behind, appears to have improperly paid money to Wingate and Sotolongo. But Stettin said there was insufficient evidence to find Rivkind violated his orders cutting Wingate out of fees from the cases. Stettin also referred questions about Rivkind to the Bar to determine whether he should return the disputed fees.
Stettin decided in February 2008 that Wingate could not profit from the cases. Rivkind was brought in by Wingate to take over the cases but was not present at last year's hearings conducted by Stettin about the fee restrictions.
Stettin's order indicated Wingate defied his own lawyer, former Florida Bar president Miles McGrane of McGrane Nosich & Ganz in Coral Gables, in creating the fee-sharing arrangement. The agreement "does not refer to the obligation agreed to by his lawyer to have such claims heard by this court."
McGrane previously said the first time he saw the fee-splitting agreement was when Stettin attached it to his order calling a contempt hearing, which was conducted in February. At the hearing, McGrane told the judge that Wingate had moved to Botswana.
McGrane did not return calls for comment by deadline Tuesday.
Wingate withdrew from the cases and retired after Miami-based Royal Caribbean claimed the Wingate Law Firm bribed a cruise line employee in exchange for inside settlement information. Stettin allowed Wingate to drop out on the condition he would walk away with no money from the Royal Caribbean lawsuits.
Former Royal Caribbean claims supervisor Wanda Ballestas acknowledged in an affidavit that she accepted a series of $500 payments for the company's confidential settlement projections, as well as a $2,000 Christmas bonus. She admitted passing information on 20 plaintiffs to Wingate paralegal Maria Elena Parilla and investigator Nelson Ayala.
