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The Florida Supreme Court has dismissed an ethics complaint against prominent Microsoft litigator David Boies, who was charged with violating Florida Bar rules by paying more than $400,000 to help his law firm’s chief financial officer pursue a contract dispute in Palm Beach County Circuit Court. In an order Thursday, the court approved the ruling of Leon County Circuit Judge George Reynolds III to dismiss the Bar complaint with prejudice. Reynolds, acting as the case referee, dismissed the complaint on May 10. He ruled that it was not a violation for lawyers to advance legal fees and court costs to their clients. Many Florida lawyers would be in trouble if the Bar prosecuted them every time they advanced fees to their clients, Reynolds said during the disciplinary hearing. Boies’ attorney, James Fox Miller, said his client is glad to have the matter behind him. “The Bar’s grievance committee had no basis for finding probable cause,” said Miller, a partner at Miller Schwartz & Miller in Hollywood, Fla., who has been friends with Boies for more than 40 years. “If the judge had found him guilty, it would have been akin to disbarment not only in Florida, but in other states. It was a very serious thing.” Boies, 63, who represented Al Gore in the 2000 presidential election recount battle, was charged with providing financial assistance to a client, Amy Habie of Miami, who was also the chief financial officer at one of his Florida offices. Boies originally met Habie while representing her in the early 1990s in a child custody battle with her ex-husband, a Guatemalan textile manufacturer. According to the complaint, filed on Dec. 11, Boies’ firm, Armonk, N.Y.-based Boies Schiller & Flexner, not only represented Habie for free, but paid more than $250,000 to other law firms who worked on the case. The Bar claimed this was a violation of Rule 4-1.8(e). Under the rule, it is generally considered a conflict of interest for an attorney to provide financial assistance to a client for pending or contemplated litigation. The case was referred to the Florida Bar by Palm Beach County Circuit Judge David Crow, who is overseeing the underlying contract dispute between Habie and Scott Lewis, a West Palm Beach gardener. The two have been battling in court since Lewis and his wife, Carol, sold the assets of their family gardening business to Habie in March 1996. The parties settled their differences in August 1998, but have been suing each other over compliance with the terms of their settlement agreement. In February 2003, Lewis filed a motion asking Judge Crow to disqualify Boies from the case because his firm was bankrolling Habie’s five-year court battle against him. Having Boies’ firm pay Habie’s legal fees gave her an unfair advantage because she had no financial incentive to resolve the dispute quickly, Lewis argued. Judge Crow denied a motion for disqualification, but claimed Boies had violated Bar rules by financing Habie’s litigation. Crow said Habie’s case did not fall under either of the exceptions allowing lawyers to pay a client’s fees. Under Bar rules, lawyers are allowed to advance court costs and fees to clients if they have an agreement that provides for repayment based on the outcome of the case. They are also allowed to represent poor clients for free. Boies conceded that his firm had been paying Habie’s legal fees, but argued that Florida Bar rules did not prevent his firm from providing pro bono legal services. In support of his position, Boies submitted affidavits from some of the top national experts on legal ethics, including Talbot D’Alemberte, a former president of the Florida Bar and the American Bar Association. “The activity for which the Bar seeks sanctions is common practice by highly ethical practicing lawyers,” D’Alemberte, a former partner at Steel Hector & Davis in Miami, said in his affidavit. “Lawyers often provide uncompensated legal services and advanced costs for employees of their firms.” D’Alemberte agreed with the findings of Stephen Gillers, vice dean at the New York University School of Law, who also submitted an affidavit in support of Boies. The rule Boies allegedly violated says that “a lawyer may advance court costs and expenses of litigation, the repayment of which may be contingent on the outcome of the matter.” Gillers claimed that the rule did not require Boies to have a written contract with his client to ensure he would be repaid. Nor did it require him to receive reimbursement before the case was concluded. “Florida rules do not even require a written agreement for fees in a noncontingent matter,” wrote Gillers, author of a leading legal ethics casebook and a member of an ABA committee that adopts rules governing ethical lawyer conduct. “This was not a contingency matter.” As a result, there was nothing wrong with the fact that Habie had not reimbursed Boies’ firm for litigation expenses dating back to October 2000 because her case against Lewis is still under way, Gillers said. “As the rule itself provides, repayment will be contingent on the outcome of the matter,” he said.

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