Quinn Emanuel Sues Recruiting Firm Over Fees for IP Lateral from Latham
By Drew Combs
March 05, 2009
When Latham & Watkins IP partners David Nelson and Sean Pak joined Quinn Emanuel Urquhart Oliver & Hedges last month, managing partner John Quinn said it was "almost unheard of" to find two young IP lawyers with "significant trial experience." But that hasn't stopped Quinn Emanuel from trying to limit the finders fee it has to pay. On Tuesday the firm filed a suit in Los Angeles County superior court, claiming that Major Lindsey & Africa, the legal recruiting company that brokered Nelson's lateral move, doesn't deserve the fees it's demanding from Quinn Emanuel for Pak and future Latham laterals. (Here's the firm's complaint.)Quinn Emanuel, which is representing itself, acknowledges Major Lindsey's role in the firm's effort to recruit Nelson, a major rainmaker with a client list that includes Symantec, Oracle, and Google. But Quinn downplays the recruiting company's involvement in Pak's move. In the suit, the firm seeks a declaratory judgment that it is not required to pay a separate placement fee for Pak, or, for that matter, for any other attorney from Nelson's group who joins Quinn Emanuel.
Major Lindsey provided the Litigation Daily with a statement on the law firm's suit. "It is unfortunate that the Quinn firm has chosen this avenue to resolve this matter; however, [Major Lindsey] is confident it has performed the services and is entitled to its fee in this case," said John Cashman, the recruiting firm's regional practice manager, in the statement. "We trust this will be resolved either in court or in conversations between the parties."
Quinn's courtship of Nelson began, according to court documents, when Major Lindsey recruiter Mark Jungers e-mailed Nelson's resume to Quinn Emanuel leaders. Attached to the e-mail was a purported new contact between Major Lindsey and Quinn Emanuel, which asserted that the law firm would be deemed to have accepted the contract by continuing with the recruiting process.
The new contract did not limit the recruiting firm's fee to a percentage of the compensation of only the first two lawyers of a larger group, unlike Quinn Emanuel's standard recruiter arrangement. (Major Lindsey's fee, according to Quinn Emanuel's filing, amounts to 25 percent of the initial annual compensation of attorneys it places.)
After Nelson and Pak joined Quinn Emanuel in February, according to Quinn Emanuel's complaint, Jungers demanded the 25 percent fee for both attorneys. He also suggested Quinn would have to pay a fee for any other attorneys in their group who later joined Quinn Emanuel.
But Quinn Emanuel claims in the complaint that Major Lindsey should not receive any fees for Pak, because it didn't represent him. Quinn Emanuel also asserts that it never assented to Major Lindsey's contract. Partners at the law firm did not return calls seeking comment.
New York-based legal recruiter Marina Sirras, who is president of the National Association of Legal Search Consultants, told the Litigation Daily that this case provides a textbook example of what can happen when a law firm and recruiter do not explicitly agree on the terms of a placement. "This can become a very sticky issue because you are dealing with extremely high fees," Sirras said. "We are not talking about a $30,000 placement."
