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Clifford Chance is finally free of any liability relating to the collapse of Brobeck, Phleger & Harrison. The firm agreed Friday to pay $5.5 million in a global settlement with Ronald Greenspan, trustee of Brobeck’s estate, and retired partners and longtime employees of Brobeck who had sued the London-based firm. The Lanier Law Firm, representing the plaintiffs in that suit, and Brobeck’s liquidation committee also signed the deal. The parties negotiated for three hours in two conference rooms next to U.S. Bankruptcy Judge Dennis Montali’s courtroom Friday morning. Montali had scheduled an auction for the rights to the litigation against Clifford Chance, but the settlement made the auction unnecessary. The KM Group, a coalition of asbestos plaintiff lawyers led by David McClain of Oakland, Calif.’s Kazan, McClain, Abrams, Fernandez, Lyons & Farrise, had planned to bid against Clifford Chance. Greenspan’s attorney, Bennett Murphy of Los Angeles’ Hennigan, Bennett & Dorman, told Montali the terms of the settlement before the courtroom was closed to discuss the deal. The deal, which is under seal, terminates the suit retired partners and employees had filed against Clifford Chance and former Brobeck Chairman Tower Snow Jr. The plaintiffs, seeking at least $100 million in damages, claimed that the defection of Snow and 16 other partners to Clifford Chance in 2002 had triggered Brobeck’s 2003 implosion. The agreement also eliminates claims Greenspan could have pursued against Clifford Chance. Greenspan has said in court filings that such claims primarily related to profits Clifford Chance received from unfinished business Brobeck partners had taken with them to the firm. Brobeck’s liquidation committee and the retired partners and employees who went after Clifford Chance are also freed of any liability for their actions. The liquidation committee had assigned rights to litigation against Clifford Chance to a liquidation trust composed of the retired partners and employees. Greenspan had filed a complaint against the trust in July — a so-called avoidance action — seeking to nullify, or in bankruptcy terms “avoid,” the transfer of those rights. Those rights now revert back to the estate. Greenspan also had charged that money the liquidation committee paid to Texas plaintiff lawyer W. Mark Lanier to represent the liquidation trust was a fraudulent conveyance and should be recovered, with interest. According to the trustee’s complaint, Lanier had a 40 percent to 45 percent contingency contract and had received $1 million in cash, liens and security interests as an advance. Clifford Chance has been embroiled in settlement discussions for five months. In July the firm agreed to pay $3.75 million to Brobeck’s estate to settle the trustee’s potential claims. The KM Group suddenly came on the scene and offered to purchase rights to the suit against Clifford Chance for $4 million. Greenspan then renegotiated his deal with Clifford Chance, which last month upped its settlement offer to $4.5 million. Clifford Chance declined to comment on the deal. Greenspan said he was happy with the agreement. “The estate gets $5.5 million in cash with no additional cost or exposure,” he said.

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