After discovery disputes about the confidentially of internal firm documents, Simpson Thacher & Bartlett has settled a recruiter’s lawsuit that claimed the law firm failed to pay a placement fee for recruiting a former Sullivan & Cromwell partner.
“The action has been settled on confidential terms,” said Boston Executive Search Associates’ attorney, Douglas Salvesen, of Boston-based Yurko, Salvesen & Remz, in a statement to ALM Wednesday.
Attorneys for Simpson Thacher and Boston Executive filed a stipulation in Manhattan federal court Tuesday to dismiss the suit with prejudice. Alan Turner, the Simpson Thacher partner representing the firm in the suit, did not return a message seeking comment.
The settlement came after the firm faced the prospect of the release of more internal firm documents. The parties were ordered to finish fact discovery Sept. 14, and a judge in recent months had rejected the firm’s request to keep a firm memo confidential.
Boston Executive filed the suit against Simpson Thacher late last year, claiming it had introduced Michael Torkin, a Sullivan & Cromwell partner, to the firm, leading to his hire at Simpson Thacher. Boston Executive said Simpson Thacher owed it a standard recruiting fee of 25 percent of Torkin’s expected first-year compensation, about $3.75 million, which would equal $937,500. The suit said Simpson Thacher has balked at paying any fee.
Proposing to amend its suit, Boston Executive also claimed its alleged damages expanded based on learning that the law firm may have paid the restructuring partner a $1 million signing bonus.
In defense, Simpson Thacher said in court filings that there was no written contract and that the recruiting agency was seeking “the benefit of a bargain it never made; payment of a fee that it never sought until after the fact, and that Simpson [Thacher] never agreed to pay.”
Earlier in the case, U.S. District Judge Lorna Schofield of the Southern District of New York, citing “sensitive business information” related to Simpson Thacher, sealed a letter on the docket and ordered other documents in the case sealed or redacted as well.
In one of the latest discovery disputes in the case, the parties tussled over a one-page July 2016 memo from firm chairman William Dougherty appointing six Simpson Thacher lawyers as internal “firm counsel” for disputes.
Simpson Thacher said the 2016 memo was a “private, confidential, and sensitive internal firm communication.” But Salvesen, the recruiting agency’s attorney, urged the judge to order that the memo be redesignated as nonconfidential, calling Simpson Thacher’s strict demand for the confidentiality of the document “silly.”
Ultimately, Schofield ordered that the memo shouldn’t be treated as confidential under a protective order.
The memo shows the firm appointed six lawyers as firm counsel for “conflicts, ethics and liability matters related to the firm,” including Joseph Kaufman, Alan Klein, Joseph McLaughlin, J. Alden Millard, Lynn Neuner and Kathy Rose. The document was placed on the docket just days before the parties dismissed the suit.