A $100 million lawsuit filed on April 20 against Stroock & Stroock & Lavan and Levene Neale Bender Yoo & Brill isn’t the first time that film financier David Bergstein has leveled accusations of professional malpractice against his former attorneys.
Bergstein, the former head of the production and distribution companies ThinkFilm Inc. and Capitol Films, earlier sued two lawyers who essentially served as general counsel to his companies: Susan Tregub, a solo practitioner in Encino, Calif., and Teri Zimon, a solo practitioner in Los Angeles.
In three separate suits, Bergstein has accused all of the defendants of collaborating to use his confidential business information to force him into bankruptcy and ruin his reputation. At the time, he was attempting to arrange The Walt Disney Co.’s $660 million sale of Miramax Corp. The deal, completed in 2010, was one of the largest deals in Hollywood in recent years.
“Defendants, a collection of prominent members of the legal community, have engaged in conduct that does violence to the essence of legal ethics,” Bergstein wrote in his most recent suit. “Defendants have not merely abrogated their responsibilities as members of the legal profession; they have made a mockery of them.”
Jim Ponichtera, a spokesman for Stroock & Stroock & Lavan, and David Neale, founder and co-managing partner of Levene Neale, declined to comment. Also sued were Daniel Rozansky, a partner in Stroock’s Los Angeles office; Neale; Irving Gross and Beth Young, both partners at Levene Neale; and Sanjay Sharma, who served as in-house counsel to an investment group called Aramid Entertainment Fund Ltd., owned by David Melner. Rozansky, Gross and Young did not respond to requests for comment, and Sharma could not be reached for comment.
The dispute centers on a falling-out between Bergstein and Melner in 2009. Bergstein alleges that Tregub, his former lawyer for 10 years and trustee to his estate, was still working for him when she disclosed confidential and proprietary information to Aramid as part of a “litigation attack” against him. In his recent suit, filed in Los Angeles County, Calif., Superior Court, Bergstein alleges that Tregub, who had accused Bergstein of failing to pay money owed to her, told him “she would ‘bring [Bergstein] down’ because she knew ‘where all the bodies were buried,’ ” according to his complaint.
“Tregub became a double agent, working for Plaintiffs but also covertly and simultaneously working for Defendants, as a mole with unfettered access in order to gather information necessary to carry out their campaign to scapegoat and destroy Bergstein,” Bergstein alleged.
Specifically, Tregub hatched a plan with the lawyers named in the latest suit, who were representing Aramid as outside counsel, to recruit creditors to force Bergstein into involuntary bankruptcy, he alleged. They also provided news reporters with confidential information to tarnish his reputation while Bergstein was negotiating with Disney on the Miramax deal, the suit says.
“He was basically shoved aside in the Miramax deal because of negative publicity,” said Alex Weingarten of Los Angeles-based Weingarten Brown, Bergstein’s attorney.
On April 9, Bergstein sued Miramax and several of its investors, alleging that he was owed $6.1 million plus 3.3 percent interest in the new Miramax company for having masterminded the acquisition from Disney. He settled that case for an undisclosed sum on April 24.
His most recent suit alleges that Stroock & Stroock & Lavan and Rozansky spearheaded litigation against him, while Levene Neale and its partners did the bankruptcy work for Aramid.
“Millions of dollars in legal fees and costs have been incurred in these litigations,” he wrote. “Moreover, the litigations, litigation fees and costs, resources devoted to the litigations, and negative publicity accompanying the litigations have resulted in nearly incalculable injury and damage to Plaintiffs’ business interests.”
Bergstein sued Tregub on March 25, 2010, alleging professional negligence. “The defendant in this case did that which we are instructed on the very first day of law school one may not do: She has breached those obligations by disclosing attorney client privileged information and engaging in actions adverse to her clients and former clients, to gain an economic benefit, and sadly, for revenge,” according to Bergstein’s complaint.
A jury trial was scheduled in that case for April 25 in Los Angeles Superior Court, but has been delayed pending a change in judges, Weingarten said. No new trial date was set.
Bergstein’s lawyer in that case, Lucia Coyoca, a partner at Los Angeles-based Mitchell, Silberberg & Knupp, did not return a call for comment. Hayes Michel, a partner in the Los Angeles office of Baker Hostetler who represents Tregub, declined to comment. Tregub has denied Bergstein’s claims.
Bergstein filed a $50 million suit against Zimon, who worked with Tregub, on Aug. 26, 2011. In that suit, filed in Los Angeles Superior Court, he calls Zimon “an extremely close friend, confidante, and professional colleague of Susan Tregub for more than 10 years” who originally was hired to assist Bergstein in litigation matters in 2008. She later assisted Tregub in scouting Bergstein’s creditors, the suit says.
“The defendant in this case has flagrantly breached her own, fundamental fiduciary obligations, but she also aided and abetted another lawyer to breach that other lawyer’s fiduciary obligations,” he wrote.
In a motion for summary judgment filed on March 2, Zimon said that Bergstein’s claims are barred by California’s statute of limitations. Furthermore, she argued, Bergstein could not assert claims for breach of fiduciary duty against her on behalf of his company, Graybox LLC, a named plaintiff in the case, because she never represented Graybox.
A hearing on the motion for summary judgment is scheduled for May 17.
Zimon’s lawyer, Rebecca MacLaren, a partner at Winget Spadafora & Schwartzberg in Los Angeles, did not return a call for comment.
Contact Amanda Bronstad at [email protected].
