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Former Clients Sue Mintz Levin, Former Partner for Fraud
The National Law Journal
October 08, 2009
A group of family members and their real estate trusts are suing Boston-based Mintz, Levin, Cohn, Ferris, Glovsky and Popeo and a former partner at the firm, Steven Rosenthal, for allegedly misusing his position to enrich himself and a friend.
Rosenthal was co-managing partner of Mintz Levin when he left two years ago to become chief executive officer of privately held real estate investment and development company Northland Investment Corp.
Mintz Levin represented the parents of the plaintiffs for many years, on both personal and commercial property matters. The mother, Helen Luongo, appointed Rosenthal as a trustee of three familiy's commercial real estate trusts when the father, Augustino Luongo, died in 1994.
According to the complaint, Rosenthal appointed a friend, Neil Cooper, and his company, Macher Management and Development Corp., to act as broker, developer and manager of the real estate trusts in 1995. The plaintiffs allege that Rosenthal's relationships with them began to sour in 2004, when they voiced concerns about Cooper's multiple roles and performance. According to the complaint, Cooper and his company collected 27 percent of the gross rent for some of the properties.
The Lamb v. Rosenthal lawsuit, which was filed in Suffolk County Superior Court in Massachusetts on Sept. 16, accuses Rosenthal and Mintz Levin of fraud, breach of fiduciary duty and legal malpractice. The plaintiffs also allege that the defendants violated the Massachusetts consumer protection law, which allows plaintiffs to collect triple damages and attorney fees. They accuse Rosenthal of threatening to oppose the appointment of the plaintiffs as their mothers' guardian unless they signed a settlement agreement, which was finalized in 2006.
The plaintiffs claim they learned of Rosenthal and Cooper's close friendship and how they improperly protected each others' interests at the expense of the plaintiffs when Cooper's company sued them in Essex County Superior Court in Massachusetts.
Cooper filed the 2007 lawsuit, Macher Development & Management Company LLC v. Stevens, to collect money the plaintiffs in the Rosenthal case allegedly owed him under his contracts to manage their commercial property. The Macher lawsuit was settled in July 2008.
According to the complaint in the recently filed lawsuit, during the discovery process in the Macher suit, Mintz Levin produced e-mails in which Cooper referred to Rosenthal as his "best friend" and "soul mate." The complaint cites another Cooper e-mail in which he said he didn't want it to look as though Rosenthal was negotiating for him and that a little "fake tension" between them would look good.
Rosenthal did not return a call for comment.
Michael Gardener, a partner at Mintz Levin, e-mailed this statement: "This lawsuit is wholly without merit and makes no sense at all. Common sense suggests that if the Luongos had valid claims against our firm or Mr. Rosenthal, they and their lawyers would not have released those claims for no payment. Common sense suggests that if the Luongos had no concerns regarding their own conduct, they and their lawyers would not have asked for a release from the firm. Common sense suggests that if Mr. Cooper's emails demonstrated any wrongdoing, the Luongos would not have paid three quarters of a million dollars to their author. And common sense suggests that if the Luongos paid that money to Mr. Cooper, they have no claim at all against the mere recipient of those emails."
Cooper could not be reached for comment. His attorney, Peter Krupp of Boston-based Lurie & Krupp, declined to comment.
Thomas Fitzpatrick, a shareholder at Boston-based Davis Malm & D'Agostine who represents the plaintiffs, declined to comment because the defendants haven't yet responded to the court filing.
When attorneys represent a single family's business and personal interests over a long period of time, there's a great deal of potential for there to be misunderstandings that no one anticipated, said George Berman, a partner at Boston's Peabody & Arnold who defends lawyers in malpractice cases, but isn't involved in this case. "It is the type of situation where attorneys always need to be cautious," Berman said. "There are many cases that have arisen from this kind of situation and there will be many more in the future."
