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Fred Furth won a $172 million award two years ago for Wal-Mart employees who weren’t paid for meal breaks. But in a suit filed Tuesday, a lawyer who worked at his firm for five years accuses him of cheating her and others out of promised bonuses. In the complaint (.pdf), Carolyn Burton says she accepted a below-market salary because she was led to believe she’d be in line to earn bonuses amounting to 3 to 5 percent of the firm’s annual profits. Instead, Burton claims that in most years, she received either a modest bonus or none at all, as Furth would claim that the firm hadn’t been as profitable as hoped. In December of 2005, weeks after an Oakland jury announced its verdict in the Wal-Mart case, he said there would be no bonuses that year, according to the complaint. The Wal-Mart verdict is on appeal, but if affirmed, Furth will receive $57 million in fees. Burton’s complaint follows the departures earlier this year of the firm’s managing partner and the firm’s lead lawyer on the Wal-Mart verdict. Current Furth Managing Partner Henry Cirillo declined to comment. “We’ll just let this matter be resolved through the courts,” Cirillo said. Burton is represented by Mark Jansen, an IP and trade secrets partner at Townsend and Townsend and Crew. She had spent four years at Morrison & Foerster and a couple of years at Brobeck, Phleger & Harrison before joining The Furth Firm in 2001. She’s since joined Walnut Creek’s Glynn & Finley. In her complaint, filed in San Francisco Superior Court, she also claims Furth “secretly engaged, at various times, in the practice of billing his personal expenses,” to artificially reduce firm profits and justify the “non- or low payment of deferred bonus compensation.” After the Wal-Mart verdict, Burton alleges, firm managers suggested the firm might soon go out of business. Burton says she was about to leave in March of 2006, but reconsidered when then-Managing Partner Michael Lehmann promised her that if she stayed on, he’d recommend that she receive $1 million of every $20 million in firm profits. But within the year, she says, Furth began a “campaign of public humiliation” to tar her reputation and try to push her from her role as co-lead counsel in a federal class action she claims to have brought to the firm. Furth allegedly sent a “false, defamatory and abusive” e-mail to every employee “publicly disciplining” Burton for the alleged mismanagement of the case, according to her complaint. She was then removed from her cases and terminated in November 2006. In a story earlier this year about the departures of Lehmann and Wal-Mart lawyer Jessica Grant, Furth told The Recorder that compensation decisions are entirely up to him, and that he doesn’t have written contracts with the lawyers who work for the firm. That could weaken Burton’s case, says one employment lawyer. Littler Mendelson partner Tyler Paetkau, who isn’t involved in this case, said he tells employers that “if it’s not in writing, then the lawyer didn’t say it.” On the other hand, if others were promised the moon to join the firm and similarly disappointed, it could work in Burton’s favor. “If I were on the other side of this, I would be concerned about what other employees, both current and former, would say,” Paetkau said. Lehmann didn’t return a call Tuesday, and Grant declined to comment publicly. Francis Scarpulla, a San Francisco plaintiff lawyer who handles class actions, said that he’d be shocked if a plaintiff firm working primarily on a contingency fee basis promised anyone a specific bonus. Plaintiff firms pay bonuses in good years, he said, and everyone takes a hit in bad years. “It’s been my experience that the bonuses are generally arbitrary and capricious,” Scarpulla said, meaning that lawyers get what the boss parcels out and “if you don’t like it, you go work somewhere else.”

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