Three erstwhile Dewey & LeBoeuf leaders sued by a former partner for allegedly lying about the firm’s financial situation a year and a half before its demise want to move the lawsuit from California state court to federal bankruptcy court and argue that Dewey should be the defendant in the case.
Patent litigator Henry Bunsow sued Dewey’s former chairman Steven Davis, CFO Joel Sanders, executive director Stephen DiCarmine, and partners Jeffrey Kessler and James Woods on June 12 in connection with their roles in recruiting Bunsow in January 2011 from the soon-to-dissolve Howrey. The suit, filed in San Francisco Superior Court, argues that the five defendants knew Dewey was in a precarious financial condition but still lured Bunsow to the firm, in part so they could collect $1.8 million in capital contributions from him. Bunsow is seeking the return of that money as well as $5 million in compensation he says was promised to him but never paid.
Some 100 Dewey partners received compensation guarantees akin to Bunsow’s, a factor that contributed to the firm’s failure this year. Dewey, which filed for Chapter 11 bankruptcy protection on May 28, owes $225 million to secured creditors and several hundred million dollars more to unsecured creditors.
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