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It is the stuff of soap operas and gossip columns. An ambitious New Yorker weds a dashing and apparently well-born French suitor, but the union quickly unravels amid accusations of lies and deceit, leaving only a prolonged and very nasty fight over ownership of their prized Upper East Side address. But the parties here are not husband and wife, they are two law firms, Paris-based Sokolow, Dunaud, Mercadier & Carreras, and New York’s Lacher & Lovell-Taylor, headed by litigator Michael A. Lacher. The two firms merged on June 15, 2000, and moved in together at Lacher’s offices on the sixth floor of 770 Lexington Avenue. The merger collapsed acrimoniously months later, but the two firms continue to occupy the same office space, pursuant to a “status quo order” issued by the Manhattan Supreme Court shortly after Sokolow Dunaud filed suit against Lacher in January 2001 for breach of contract, fraud and trespass, among other claims. The arrangement has been far from harmonious. A special referee assigned by Supreme Court Justice Alice Schlesinger to investigate whether the two firms were interfering with each other’s “quiet enjoyment” of the space produced a June 2001 report detailing vitriolic fights over office supplies and furniture, a vandalized conference room, a trashed office, support staff asked to choose sides and threats of physical violence. “I find that both sides have interfered with the quiet enjoyment of the other and there is enough blame to go around,” Nicholas Doyle, the referee, concluded in his report. “[T]here exists the potential for further damage to property and possible physical harm as tensions are running high and neither side is mature enough to act in a professional manner.” Doyle recommended that one of the two parties be asked to vacate the offices, and Sokolow Dunaud, which was assigned control of the lease as part of the merger, moved for partial summary judgment in July 2001, seeking a declaration that it is the sole tenant of the space. In November, Schlesinger granted Sokolow Dunaud’s motion, citing the agreement between the firms and Sokolow Dunaud’s reliance upon it. Recently, however, the Appellate Division, 1st Department, issued a ruling in Sokolow, Dunaud, Mercadier & Carreras LLP v. Michael A. Lacher, 1192, reversing the grant of partial summary judgment. Writing for the appeals court, Justice Luis A. Gonzalez directed the trial court to hear Lacher’s argument that the firms’ agreements should be rescinded because Sokolow Dunaud misrepresented itself in order to induce him into entering the merger. In his response to Sokolow Dunaud’s suit, Lacher claimed that, facing eviction from its own offices at 50 Rockefeller Plaza, Sokolow Dunaud partners “orchestrated a scheme to hijack [Lacher's] valuable full-floor 12,000 square foot office leasehold and take over [Lacher's] law practice.” Lacher declined to be interviewed. His lawyer, Paul Curran of Kaye Scholer, said, “We are happy about the court’s decision and looking forward to going to trial.” When reached for comment Sept.18, Mark Lebow, Sokolow Dunaud’s New York managing partner, said he had not been aware of the Appellate Division decision and could not comment. He described the office situation as difficult, and said, “We are doing the best we can.” He did not return calls later in the week for comment. FORMER COUDERT LAWYERS In his filings, Lacher alleges that, knowing of his desire to merge his litigation practice into a larger firm with strong transactional capabilities, Sokolow Dunaud partners sought to convince him their firm was more substantial than it proved to be in actual fact. Lebow allegedly introduced Lacher to 15 lawyers at Rockefeller Plaza whom Lebow described as Sokolow Dunaud partners with “large-firm credentials” in areas including mergers and acquisitions, corporate finance and intellectual property. Lacher alleges that Lebow and Joel Adler, another Sokolow Dunaud partner, later told him the 15 lawyers he had met were not partners at the firm but essentially solo practitioners who had an “overhead” arrangement with the firm, allowing them to give their clients the impression they were affiliated with a large international firm. These lawyers chose not to move with the Sokolow Dunaud lawyers. According to Sokolow Dunaud’s Web site, though the firm lists offices in London and Atlanta as well as New York and Paris, it currently has only 11 lawyers in total, with four partners and two associates based in New York. Lacher’s firm has seven lawyers. Lacher is also alleging that Sokolow Dunaud lawyers claimed their firm was a “spin-off” of the much-larger international law firm Coudert Brothers, and that Lebow boasted that he had been the managing partner of Coudert. A Coudert spokesman confirmed that Lebow held a senior-level administrative role at that firm, where he was a partner until 1998, but said the firm does not have a formal managing partner position. The name partners of Sokolow Dunaud, Nicholas Sokolow, Jean-Francois Mercadier, Patrick Dunaud and Jean-Francois Carreras were all former Coudert partners in Paris or New York. FINANCIAL RECORDS Lacher is further alleging that financial records were kept secret from him, though Lebow had told him all billings and other financial records were open and available to all partners. In court documents, Lacher also claims Sokolow Dunaud, which was to assume most operational responsibilities, withheld his monthly draws and origination fees. He further alleges Sokolow Dunaud refused to accept Lacher’s French clients at its Paris office, failed to make payments on a bank loan it had assumed as part of the merger, and sought to terminate members of Lacher’s staff. In its own filings, Sokolow Dunaud, which is representing itself, disputes much of Lacher’s account. Sokolow Dunaud was not about to be evicted from its Rockefeller Plaza offices, alleges partner Michael Calvey in his firm’s response to Lacher’s appellate brief. Rather, it was Lacher who was in danger of losing the Lexington Avenue space, which he leased in 1994, owing to serious financial difficulties. Much of the space had been and continues to be subleased. Under these circumstances, Sokolow Dunaud maintains, it made sense for Lacher to assign his interest in the lease to Sokolow Dunaud, which then undertook extensive renovations costing more than $600,000. Sokolow Dunaud is arguing that Lacher, who it claims was a “contract partner” rather than an equity partner, validly assigned his interest in the property, along with other obligations. He then breached a valid contract, Sokolow Dunaud claims, by refusing to integrate himself into the combined firm, and by insisting on billing clients under the Lacher name, even when Sokolow Dunaud had provided support. Sokolow Dunaud has also sued a number of Lacher’s clients, seeking a share of fees it claims it is owed. Lacher issued a series of memoranda complaining about aspects of the merger beginning in the fall of 2000. He declared the merger canceled and rescinded in a memorandum he sent to Lebow and Sokolow on Jan. 8, 2001. Their suit followed a week later. BAD TO WORSE Since the commencement of the suit, the situation within the office has gone from bad to worse. The special referee was appointed in April 2001 after Sokolow Dunaud moved by order to show cause to hold Lacher in contempt, to evict him from the premises and to direct him to undergo psychiatric evaluation. Among the incidents described in the referee’s report are a scuffle over an extra office chair that resulted in a tug-of-war between Lacher and Calvey. The struggle ended only when the chair broke. Lacher also had his staff seize office supplies and empty the copy room of paper. Acts of petty vandalism have also plagued the office. Scattered papers and spilled coffee have been known to mysteriously wind up on office or conference room floors. The door has been torn off the conference room credenza, and someone has removed the hyphen from the “Lacher & Lovell-Taylor” sign. Lacher responded to the latter incident by calling the police. According to the referee’s report, the two firms have also deployed their support staff against each other. Joaquin Acevedo, a file clerk employed by Lacher, has made a number of threats against Julissa Callahan, the Sokolow Dunaud receptionist who was formerly a close friend of Acevedo and his wife, Carmen, also a file clerk. Calvey gave Callahan, who previously worked for the Lacher firm, a $200 cash bonus for her loyalty. Lacher gave the Acevedos a desk and space in the file room. Among the Acevedos’ duties has been to monitor Callahan as she sorts the firms’ mail, as Lacher believes it is not receiving all of its mail. “I find the use of these employees, by both sides, to be their most reprehensible act of all,” Doyle, the referee, wrote in his report. “Each side is responsible for destroying this friendship based on their own selfish whims.” The two firms not only share an office, but also a phone number. Calls placed to either firm are answered not with either of the firms’ names but with a generic announcement that the caller has reached “law offices.”

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