The drummer of Fleetwood Mac, Michael "Mick" Fleetwood, and several of his business partners, have sued their former attorney, Paul McDonald, and law firm, Bernstein, Shur, Sawyer & Nelson, for putting them on the hook for $4.5 million in attorney fees.
The Fleetwood group had hired the firm, which is based in Portland, Maine, to bring suit against a division of the British Broadcasting Corp. over distribution rights to rare musical recordings worth about $100 million, according to an amended complaint in the lawsuit, which was filed on March 26 in federal court in Maine. McNulty v. McDonald, No. 2:09-cv-00111 (D. Maine).
Michael J. Waxman, a solo practitioner in Portland, who represents the Fleetwood group, did not return a call for comment.
But according to court papers, the Fleetwood group's British-based company, Bee Load Ltd., paid Bernstein Shur $250,000 in upfront fees to file the suit in 2003 in Maine.
Two years later, Bernstein Shur agreed to renegotiate its retention agreement so that Fleetwood's group would pay 50 percent of the hourly rate for each attorney on the case, while the firm would obtain a contingency fee of up to 25 percent, the suit claims.
At that time, Fleetwood's group allegedly asked McDonald if they could be individually liable for the BBC division's attorney fees, to which McDonald replied there was "no chance."
But in 2005, the BBC division sued Bee Load in England, where a London court imposed about $150,000 in costs against Fleetwood's group. Bee Load filed for Chapter 11 bankruptcy protection in 2006.
Invoking a British law called the "Funders' Rule," the BBC division sought $4.5 million in attorney fees, the suit claims.
The Fleetwood group is suing Bernstein and McDonald for professional negligence, breach of fiduciary duty, unintentional misrepresentation and a declaratory judgment to invalidate sums that Bernstein Shur claims are owed the firm.
McDonald, a shareholder in the Portland office, who is chairman of Bernstein Shur's litigation practice group, did not return a call for comment.
Peter Rubin, a shareholder at Bernstein Shur who serves as general counsel, said the Fleetwood group owes the firm more than $900,000 in fees.
"They lost their case," he said, "and they're trying to make allegations that would relieve them of that payment obligation."
Further, he said, the allegations in the suit are incorrect.
"Mr. McDonald did not advise them that they could not and would not be held liable for the BBC fees," he said. "Among other things, he informed them they should consult with English counsel to get an answer to that question."
Bernstein Shur has about 90 attorneys in Portland and Augusta, Maine, as well as Manchester, N.H.
