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In a rush of enthusiasm last May, lawyer Mark Franz told reporters that creating a lobbying shop with strong Texas ties was “something that those of us from the Texas Mafia have always thought was much needed but never done.” Now the parent law firm at whose expense the new shop was formed — Cleveland’s Arter & Hadden — is telling a Dallas County District Court that it all happened too fast to be legitimate. Arter & Hadden has sued the breakaway lawyers — 23 of them, including 10 partners, from its San Antonio, Austin and Washington, D.C., branches — alleging they gave a bare week’s notice before leaving to form the firm of Loeffler, Jonas & Tuggey. Among the causes of action, the suit lists breach of the partnership agreement and breach of fiduciary duty. The alleged renegades even took over the address of Arter & Hadden’s San Antonio office as their home base, the suit says. It asks for reimbursement for the use of fixtures and equipment. The suit says that the parent firm invested more than $1 million in its San Antonio office. Representing the plaintiffs are Michael P. Lynn of Dallas’ Lynn, Tillotson & Pinker. A spokesman for the 30-lawyer Loeffler Jonas says the firm “categorically denies” the allegations, calling them “silly.” “We all understand why this was filed,” says John Weaver, a public relations specialist speaking for the new firm. “Loeffler Jonas took the crown jewel of Arter & Hadden’s practice. And Arter & Hadden is a firm that’s had some hard times, so now they’re behaving like a kid who is whining when he doesn’t get his way.” Weaver added that much of the parent firm’s “management issues” will get a public airing at trial. “Some of the partners around the country, even, are going to be surprised when they hear about the Dallas decisions,” he said. It’s been a difficult year for Arter & Hadden. In The National Law Journal‘s November survey of the largest 250 firms, the 325-lawyer Arter showed the greatest decline in lawyers, having shrunk some 31 percent over the past year. The firm’s rank dropped from 64 to 123. “When they decided they’d try to start a law firm, we attempted to work things out with them,” Arter spokesman Mike Androvett said. “Now we have been forced to ask the courts to make things right, and we believe that’s exactly what will happen.” Thomas E. Loeffler, who was a Republican congressman from 1979 to 1987, came to Arter & Hadden in 1993 and headed the firm’s government affairs practice at the time of his resignation. He has chaired campaign efforts for both presidents Bush. Among the lawyer-politician’s clients — all of whom Loeffler has said chose to come with him and his departing colleagues — are Bristol-Myers Squibb Co., Circus Circus Enterprises, Citigroup Inc. and Columbia/HCA Healthcare Corp.

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