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The bad blood flowing from the corpse of Brobeck, Phleger & Harrison just turned a few shades darker. On Oct. 1 a group of former partners and senior staffers sued former chairman Tower Snow Jr., and his current firm, Clifford Chance, seeking as much as $140 million. The complaint had been rumored for months. And it mostly rehashes old feuds about whether Snow’s defection last year to Clifford Chance with a group of 16 partners triggered Brobeck’s demise. But there’s one new twist that’s sure to create a font of fresh bad feelings. Citibank F.S.B. — which has a close relationship with Snow and London-based Clifford Chance — agreed to free up $1 million of previously frozen Brobeck funds to allow the plaintiffs to sue. This past summer, Brobeck’s liquidation committee, led by former Brobeck chairman Stephen Snyder, started talking to Houston plaintiffs lawyer W. Mark Lanier of The Lanier Law Firm about suing Snow and Clifford Chance. Lanier, known in Texas for bagging a couple of nine-figure jury verdicts, met Snyder when they worked on opposite sides of asbestos litigation. But Snyder faced a problem. Lanier would take the case for a contingency fee, but he needed $1 million up front to cover expenses. The liquidation committee did not have that kind of ready cash. Citibank, which was owed $57 million when Brobeck announced its dissolution in late January, had taken control of the firm’s bank accounts and had to approve nearly every expense. Snyder asked for contributions from partners. It’s not clear how much was raised or how many partners chipped in, but it apparently wasn’t enough. Without Citibank’s help, it looked like the effort would fade. Near the end of the summer, bank officials agreed to release $1 million in Brobeck cash that the bank had frozen with a lien, giving the green light to the suit, according to one lawyer familiar with the negotiations. Snyder referred questions to Lanier, who confirms he has received $1 million. A Citibank spokesman declined to comment. Citibank’s complicity in this attack on Snow and Clifford Chance creates a tense situation. Citigroup Inc., the bank’s parent, is a Clifford Chance client. In addition, the bank has lending relationships with many Clifford Chance partners. In fact, the bank recently helped Snow refinance the mortgage on his Napa Valley home, according to one of Snow’s partners. In a statement Clifford Chance labeled the suit’s claims “without merit,” adding: “We find the notion that Clifford Chance is responsible for the collapse of Brobeck, Phleger & Harrison to be absurd.” Snow declined to comment. One curious aspect of the suit is that it states that Brobeck has assigned certain claims to a trust. Lanier maintains that this was not done to try to shield any recovery from Brobeck’s creditors. In September some creditors filed a Chapter 7 petition to force the firm into involuntary bankruptcy. Lanier couldn’t say precisely how many former Brobeck partners support this legal assault. One former Brobeck partner who opposes the suit (and is not at Clifford Chance) says he hated to see this suit filed: “Once you start down this road, it’s going to be nasty.”

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