A bitter legal dispute between Grant & Eisenhofer and a lawyer who left the firm in 2015 has prompted scrutiny in Delaware of firm co-founder Stuart Grant, who was accused of sexually harassing female associates at his firm in court papers filed as part of the dispute.
Wilmington, Delaware-based newspaper The News Journal reported on Monday that a high-ranking state senator has urged Delaware’s governor to consider withdrawing Grant’s name from re-appointment to a position on the University of Delaware’s board of trustees. Grant has sat on the university’s board since 2011 and has served as a financial benefactor for the school. Recently, he reportedly pledged $10 million to the school over a five-year period.
The News Journal reported that David McBride, a Delaware-based Democrat who serves as the president pro tempore of the Delaware state Senate and chairman of the body’s Executive Committee, said he won’t have his committee consider Grant’s re-appointment to the university trustee board “until there is more clarity” on the sexual harassment claim. The state Senate Executive Committee oversees appointments made by the governor, including those to the university’s board of trustees.
McBride and two members of his legislative staff did not immediately respond to requests for comment.
A spokesman for Grant & Eisenhofer, Allan Ripp, said on Tuesday that the claim of harassment is “unsubstantiated” and stressed that it emerged during a high-stakes court dispute over millions of dollars in legal fees, pitting the firm against a former lawyer there. The allegation of harassment was not made by any purported victim and there has never been a report of harassment against Grant by any woman at the firm, the spokesman added.
“The original source material for this is from a throwaway, one-line answer by a former member of the firm who was in the midst of a very large fee dispute involving tens of millions of dollars,” said Ripp. “This very loaded innuendo became the basis of reporting that proved to go nowhere and was unsubstantiated.”
Ripp also confirmed that Grant intends to retire from his firm midway through this year, but said that has “zero connection” to the underlying fee dispute or the harassment accusation that stems from that fee battle. Grant has been planning his retirement for well over a year, he said.
The former lawyer embroiled in the dispute with Grant & Eisenhofer is whistleblower attorney Reuben Guttman, a former Grant & Eisenhofer director—the firm’s equivalent of a profit-sharing partner. He left Grant & Eisenhofer in 2015 and later formed the Washington, D.C., whistleblower firm Guttman, Buschner & Brooks. Grant & Eisenhofer has accused Guttman of conspiring to lure away a lucrative False Claims Act case against pharmaceutical company Celgene Corp. on his way out of the firm.
The harassment accusation, which The American Lawyer noted in an October article, came amid a dispute over legal fees in the false claims suit. Much, but not all, of the fee dispute has since been dismissed by a federal judge in Los Angeles. In March, a federal judge in Los Angeles allowed the client in the false claims suit, former Celgene saleswoman Beverly Brown, to collect a more than $78 million award for serving as the whistleblower in that case. A portion of that award is headed to Brown’s lawyers; Guttman and Grant & Eisenhofer are battling over who gets what in terms of fees in the Celgene case.
In his early response to a Grant & Eisenhofer lawsuit accusing Guttman of poaching the Celgene case, Guttman filed a motion to dismiss that, among other arguments, took aim at allegations that he berated Grant & Eisenhofer staff members via email before leaving the firm. Instead, Guttman’s lawyers argued, he left the firm after becoming fed up with what he believed was unethical behavior on the part of the firm’s leaders—Grant and Jay Eisenhofer.
Guttman alleged that Grant had sexually harassed female associates at the firm. To support that argument, Guttman attached an email exchange from April 2015 in which he expressed concerns to Grant & Eisenhofer securities lawyer Daniel Berger about a “hostile work environment for women.”
In light of Guttman’s motion to dismiss, Grant & Eisenhofer issued a statement in October that described his claims as wholly false.
“The claims alleged by Reuben Guttman in his motion are wildly untrue. It’s especially sad that he would peddle this fiction as a cover for trying to evade the terms of a contractual agreement to share substantial fees owed to our firm stemming from our years-long work on the Celgene whistleblower case,” the firm’s October statement said. “We will continue to advance our right to secure the portion of Ms. Brown’s bounty and related costs that she contracted to share with us, regardless of the tall tales that Mr. Guttman tries to tell.”
Guttman did not immediately respond to a phone message left at his current firm.