Two American victims of the 1986 hijacking of Pan Am Flight 73 have sued Washington's Crowell & Moring over its demand that they share their multimillion-dollar award with other Flight 73 victims represented by the law firm.
The lawsuit -- Dave v. Crowell & Moring and Pan Am Flight 73 Liaison Group -- was filed Jan. 4 in Los Angeles County Superior Court by two sisters, Gargi and Giatri Davé, who, as children, suffered severe injuries in the hijacking at the Karachi, Pakistan airport. Twenty passengers were killed and more than 120 were wounded during the assault.
At the core of the suit is the legitimacy of a retainer agreement and a joint prosecution agreement as well as their effect following the 2008 U.S.-Libya treaty settling terrorism-related legal claims of U.S. citizens for $1.5 billion. President George W. Bush issued an executive order implementing claims settlement.
If the law firm is successful in its demand, the sisters will lose approximately 90 percent of awards that could total from $4 million to $12 million, according to their attorney, Lee Boyd, an international law litigator from Newbury Park, Calif. The bulk of that money would go to noncitizens who comprise nearly 77 percent of Crowell's 178 hijack clients.
Crowell's Stuart Newberger, lead lawyer for the Pan Am victims, said, "We have fought tirelessly for 178 victims of the terror attack on Pan Am 73 who agreed to join together to achieve justice for the crime they suffered. Our effort involved more than 30 Crowell & Moring attorneys spending well over 11,000 hours over the course of five years, and it's still ongoing. We regret that the Davé sisters have a grievance with the process as we near the end, and we are hopeful that we will be able to resolve it swiftly."
The Davés signed the Crowell retainer agreement in 2005, authorizing the firm to pursue a lawsuit against Libya. As part of that agreement, every signatory was required also to sign a joint prosecution agreement. The agreement stated that any recovery would be shared on a sliding scale based on the type of injury and without regard to nationality, according to the complaint. A Pan Am Liaison Group was established, consisting of one American and four non-Americans, to deal with litigation counsel, and it was represented by New York's Latham & Watkins. The agreement also provided for a 25 percent contingency fee to Crowell. Crowell did file a lawsuit, but it did not result in a judgment and was dismissed after the treaty settlement.
Boyd alleges in the complaint that the retainer and joint prosecution agreements were the result of the firm's and the Liaison Group's "unlawful professional conduct, nondisclosures, fraudulent omissions, and manipulation of Plaintiffs whom they solicited as clients."
For example, she contends the firm and the liaison group did not disclose that the vast majority of the hijack victims were non-U.S. nationals; that nationality would play a pivotal role in a hijack victim's chance of recovery against Libya, or that the chances of a non-U.S. national recovering from a U.S.-negotiated settlement were virtually nil.
"There's no mention of the words treaty, diplomacy, or negotiated settlement in these agreements," said Boyd. "My clients were not told that was a possibility. At that time in history, it was likely these claims would be settled by negotiated diplomacy between the sovereigns, not by the courts, and these lawyers, who are very sophisticated in this area of law, well knew that. They did not notify my clients of the serious conflicts of interests they would have with the non-national clients. That was a serious breach of ethics and invalidates any agreement."
Gargi Davé has received $3 million from the Foreign Claims Settlement Commission and may be entitled to an additional $3 million, said Boyd. Her sister's claim is still being reviewed but she is entitled to a minimum of $500,000 and may receive an additional injury award of up to $6 million.
Boyd said she believes about $30 million in treaty awards to American hijack clients have been turned over to the Crowell trust fund, which is being managed by Latham. She also alleges in the complaint that the law firms have pressured American plaintiffs to turn over their awards or face litigation. Latham is not a named defendant in the lawsuit. Boyd said she hopes to determine that firm's full role in discovery. Latham declined to comment.
"It's important to get the rights and obligations here judicially determined so people know where they stand," said Boyd, an international human rights litigator. "It's hubris that Crowell didn't seek a judicial determination before taking this money and sharing it with non-nationals knowing that the executive order said non-nationals are not covered."