Connoni and Finn talked about what would happen if Connoni did not meet the billing expectations, the complaint says. Finn proposed linking Connoni's compensation directly to how much he collected, the complaint states.
"Mr. Connoni rejected that proposal, explaining that while he hoped and expected to quickly succeed, the building of a department could take significant time and effort by both himself and [Edwards Angell]," the complaint says.
Ultimately, Connoni says they agreed that his compensation could be "appropriately" adjusted based on a variety of factors, including economic and financial conditions and the state of private equity and securities practice areas.
Both sides agree that Connoni did not meet the expectations.
Connoni, in his complaint, says that during the first nine months of 2008 he only billed $800,000 and collected $100,000.
Edwards Angell, in its motion to dismiss and arbitrate the claim, says it collected $135,000 for Connoni's work in 2007 and 2008, only 12 percent of what he promised in his agreement. The firm charges that he did not even show up for work at some times and failed to make timely capital contributions to the firm.
In the arbitration, the law firm is seeking $461,750 in damages and a declaration that it does not owe money.
'UNPRECEDENTED DOWNTURN'
Among the explanations Connoni advances for failing to meet his billing targets were "problems in the private equity and securities offering practice areas, the credit crisis, the nearly unprecedented downturn in the general economy and the disruptions in the financial markets."
He claims he also was hampered by late-paying clients, a lack of firm support, the departure of key partners, and the failure of other partners to introduce him to firm clients.
The complaint does not name the departing partners. Reed Smith last year hired away John Hooper, a commercial litigator and the managing partner of Edwards Angell's New York office. He brought along partners Eric Gladbach and Christopher Healy. Hooper did not return a call seeking comment.
On Sept. 23, 2008, a week after Lehman Brothers fell, Connoni met with Walter Reed, who had taken took over as Edwards Angell's firmwide managing partner that April. Reed, the complaint says, informed Connoni he had been terminated. Connoni says he was given no advance notice before he was fired.
Under his letter agreement and the partnership agreement, Connoni claims the firm should not have been able to terminate him until after January 2010 and only with 75 percent of the partners voting. Because the firm did not follow these required procedures, Connoni says he is entitled to draw compensation through the first four months of 2010 on the same basis as other capital partners. He also is seeking unspecified damages plus interest.
The letter agreement, included as an exhibit, stipulates that Edwards Angell's executive committee starting in 2008 would review Connoni's performance before Feb. 28 each year. It could then recommend an extension of the letter agreement for another year or his continuation as a partner without the letter agreement.
The letter says the executive committee could remove Connoni as a partner at any time on or after Jan. 31, 2010, with at least 90 days notice. The full partnership could remove him "at any time" with a 75 percent vote.
The firm, in its motion to dismiss and in the Boston arbitration, does not deny that it did not call a firmwide meeting. Rather, it says it wanted to avoid "embarrassment" for Connoni. The firm claims it met "all of its pertinent contractual obligations to Connoni, and resolved logistical issues relating to his departure." Connoni claims Reed fired him "in substantial part" because of the firm's "financial problems." The complaint does not elaborate. Edwards Angell grossed $315 million in 2008, down 1.7 percent, according to The American Lawyer, a New York Law Journal affiliate. Profits per partner fell 15 percent to $610,000.
Connoni is now unemployed, his lawyer, Joel Chernov at Constantine Cannon, said in an e-mail.
Starting less than two weeks after he joined Edwards Angell, the Internal Revenue Service began filing liens against Connoni's property that now amount to more than $2.3 million, according to New York City Department of Finance records. In its arbitration claim, the firm says New York state has filed a $154,090 tax levy on Connoni's property. Because of that, Edwards Angell expects the state will claim priority on the $19,654 in Connoni's capital account.
The state currently has an open $171,119 tax warrant against Connoni, which it filed in October 2007, according to a records database.
Chernov said in his e-mail that the "liens are not related to the lawsuit." He did not elaborate.
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