Thank you for sharing!

Your article was successfully shared with the contacts you provided.
A lawyer who referred a lucrative fen-phen diet drug case to a leading plaintiffs’ firm is claiming the firm withheld her referral payment almost a year to punish her for objecting to the apportionment of settlement proceeds. Angela Roper is suing Teaneck, N.J.’s Davis, Saperstein & Salomon for $7,000, the loss she allegedly suffered from late payment of $180,000: her one-third share of the $541,000 legal fee in the case. A judge awarded the total fee in September 2003 after Roper, on behalf of the client, objected to a $60,000 enhancement Davis Saperstein requested. Roper, of Totowa, N.J.’s Roper & Twardowsky, got her share in August 2004, and only after suing. Now, not content with getting her money plus some interest, plus a few hundred dollars in costs, Roper is continuing the suit, seeking additional interest, plus punitive damages. Davis Saperstein says it had sound legal reasons to withhold payment and that Roper’s pursuit of the suit now that she has the check is merely a personal vendetta. It has asked a judge to dismiss the matter on grounds that the filing, because it alleges breaches by professionals, requires an affidavit of merit. Roper says she didn’t obtain an affidavit of merit because it’s a contract case, not a matter of a breach of professional duties. The case, Roper v. Davis, Saperstein & Salomon, Pas-L-2168-04, has been the rare instance of a dispute over a referral fee that didn’t settle quickly and quietly. In 1999, Dora Koehler, a teacher from Pequannock, N.J., who had undergone surgeries for heart damage after taking the diet-drug combination known as fen-phen, turned to Roper for advice about a claim against the drug’s maker, American Home Products. Roper referred her to Davis Saperstein, which has handled hundreds of fen-phen cases, according to partner Samuel Davis. He is a certified civil trial attorney, authorized by court rule to pay referral fees. On Koehler’s behalf, the firm sued American Home Products, now Wyeth, of Madison, N.J., and agreed to pay Roper one-third of any fees recovered. Roper also remained actively involved. In December 2000, Wyeth and Davis, Saperstein reached agreement on a settlement in Middlesex County Superior Court, where thousands of fen-phen cases had been assigned to Judge Marina Corodemus. The size of Wyeth’s payment is confidential, but Corodemus later referred to it as an “optimum” settlement, and the $541,000 fee that Corodemus awarded suggests the settlement was over $2 million. Under Court Rule 1:27, a contingency lawyer can charge $541,000 on a $2 million settlement to an adult without applying to a court. To collect additional fees, an application to a judge must be made. Davis Saperstein did just that. In 2001, it submitted an agreement by the client earlier in the case that she would accept a $600,000 cap on fees and asked Corodemus to enhance the fee by at least the $60,000 difference between the agreed-on cap and the rule-authorized sum. That’s when the trouble started. Roper says that on the client’s behalf she objected to the enhancement because it would have reduced the net recovery by $60,000. But Roper wasn’t willing to forgo her share. If Davis, Saperstein valued the legal work at $600,000, her share should be $200,000, she reasoned. But the firm, not the client, should pay it, she argued. That meant Roper’s share would be 37 percent of the fee awarded, not the 33 and one-third percent in the referral agreement. “I objected to the enhancement because they didn’t deserve it and it would have been against the client’s interests,” she says. But she wanted the benefit of the enhancement at the firm’s expense. Koehler backed her. In a certification, the client told Corodemus she had been pressured by Davis Saperstein into agreeing to a settlement that was lower than her expectations. She also said she learned after the fact that her case was part of a “package” in which the amount of her settlement depended in part on what other Davis Saperstein clients were receiving. “I firmly believe that the Davis Saperstein firm betrayed me, and put their own interest in receiving hefty legal fees for a package settlement ahead of their duty to obtain the best possible result on behalf of me as their client,” she wrote. She also threatened to sue the firm for legal malpractice, a suit that has not materialized. Pending a decision, Corodemus ordered Davis Saperstein to place in escrow $800,000 of the settlement, and issued a ruling after a failed mediation over the fee. She declined to grant the enhancement on grounds that Davis, Saperstein didn’t submit the requisite time sheets and expense accounts. But the rest of her September 2003 opinion was an endorsement of the settlement and a rejection of the notion that partners in the firm, including Davis and Marc Saperstein, did anything but terrific work, except when it came to keeping the client informed about the status of the case. “Aside from the client communications, the Davis firm’s work during the diet drug litigation was superior,” she wrote. She noted that the client had signed off on the settlement in court at the time it was reached. She added: “Once again this was an optimum settlement in New Jersey. Mr. Saperstein performed as one of the significant players in topping the barricade constructed by American Home Products. “While no one can predict what, if any, verdict could be reached at trial, a settlement at this level insures satisfaction, closure and peace of mind for the client,” the judge said. She also rejected the suggestion that the settlement was part of a package. “These personal injury claims were not settled in the aggregate; each plaintiff stood alone,” she said. Roper may not have agreed, but at that point, she argues, Davis Saperstein should have sent her at least the $180,000, plus interest, representing one-third of the $541,000. But the firm kept her share in escrow for 11 months, releasing it last July only after she sued and Passaic County Superior Court Judge Joseph Riva ordered the payment. She received about $187,000 in fee and interest, but she wants more. According to Roper, the late payment caused her to pay interest on a business loan carrying more interest than the $180,000 received in the Davis Saperstein escrow account. Davis and the firm’s lawyer, Bennett Wasserman of Newark, N.J.’s Stryker, Tams & Dill, say there was good reason the payment wasn’t made. First, holding on to the proceeds of a case when there is a threat of a malpractice suit pending is the proper course, they say. Second, Wasserman says there had been no adjudication of Roper’s demand for an additional $20,000 out of the global fee award. Instead of suing, Roper should have gone back to Corodemus for a ruling on the apportionment between the two firms, Wasserman says. Finally, the firm was concerned because the litigation over the fee had resulted in disclosures about the underlying case. Those revelations compromised the confidentiality of the settlement and might have caused American Home Products to repudiate it, putting the entire settlement at risk, they say. Roper says the excuses for the late payment are belied by the fact that Davis Saperstein took its share of the fee after Corodemus’ ruling but withheld her share. She also concedes that most lawyers looking at the facts of the case would wonder why she is pursuing Davis Saperstein after receiving her payment plus market rate interest. But she adds, “I don’t care what lawyers think; they won’t be on the jury.”

This content has been archived. It is available exclusively through our partner LexisNexis®.

To view this content, please continue to Lexis Advance®.

Not a Lexis Advance® Subscriber? Subscribe Now

Why am I seeing this?

LexisNexis® is now the exclusive third party online distributor of the broad collection of current and archived versions of ALM's legal news publications. LexisNexis® customers will be able to access and use ALM's content by subscribing to the LexisNexis® services via Lexis Advance®. This includes content from the National Law Journal®, The American Lawyer®, Law Technology News®, The New York Law Journal® and Corporate Counsel®, as well as ALM's other newspapers, directories, legal treatises, published and unpublished court opinions, and other sources of legal information.

ALM's content plays a significant role in your work and research, and now through this alliance LexisNexis® will bring you access to an even more comprehensive collection of legal content.

For questions call 1-877-256-2472 or contact us at [email protected]


ALM Legal Publication Newsletters

Sign Up Today and Never Miss Another Story.

As part of your digital membership, you can sign up for an unlimited number of a wide range of complimentary newsletters. Visit your My Account page to make your selections. Get the timely legal news and critical analysis you cannot afford to miss. Tailored just for you. In your inbox. Every day.

Copyright © 2020 ALM Media Properties, LLC. All Rights Reserved.