Akin Gump Strauss Hauer & Feld offices in Washington, D.C. November 10, 2015. Photo by Diego M. Radzinschi/THE NATIONAL LAW JOURNAL. (Diego M. Radzinschi)
Federal prosecutors have accused an Akin Gump Strauss Hauer & Feld partner—and a government lawyer himself until last year—of hawking a copy of a nonpublic whistleblower complaint to a company facing a False Claims Act lawsuit.
The alleged scheme ended with a resounding thud for the defendant, Jeffrey Wertkin, who joined Akin Gump as a partner after serving nearly six years as a trial lawyer in the U.S. Justice Department’s Civil Division. A criminal complaint unsealed on Monday in San Francisco federal court says Wertkin was arrested at a hotel in Cupertino, California, on Jan. 31 as he attempted to sell a copy of the sealed complaint for $310,000 to an undercover Federal Bureau of Investigation agent.
“My life is over,” Wertkin told an arresting officer, according to the criminal complaint. The case against Wertkin—who was allegedly wearing a wig and going by the name “Dan” when the FBI took him into custody—was first reported by Bloomberg.
Wertkin’s arrest comes less than a year after he joined Akin Gump in April. It could draw attention to law firms’ vetting of potential lateral hires, a process that often focuses mainly on a prospective partner’s book of business. Wertkin was quickly fired by Akin Gump, a firm representative said in a statement.
“We are shocked and deeply troubled by the conduct alleged in the charges filed against Mr. Wertkin. Honesty and integrity are at the core of our values and our client relationships,” the firm’s statement said. “Immediately upon learning of these charges, we took swift action and Mr. Wertkin is no longer with the firm.”
A lawyer for Wertkin, Julia Jayne of San Francisco criminal defense firm Jayne Law Group, couldn’t immediately be reached for comment on Wednesday. The Justice Department didn’t respond to a request for comment about Wertkin’s arrest and his record while at the DOJ.
A Wig and a Duffel Bag
The complaint against Wertkin claims he engaged in a months-long plot to collect a “consulting fee” for a sealed FCA lawsuit against an unnamed company based in Sunnyvale, California. Using the name Dan, Wertkin allegedly first contacted a high-ranking employee at the company in late November, alerting that employee that a sealed false claims lawsuit had been brought against the company.
Wertkin allegedly sent the company employee a redacted first page of the FCA complaint, which the FBI verified as a legitimate document filed under seal in January 2016 in San Francisco federal court, according to the complaint. In December, FBI agents spoke to the company employee, who agreed to remain in touch with Wertkin and have their phone calls recorded.
During a recorded call in December, Wertkin said he’d be willing to provide a full copy of the sealed FCA complaint for $300,000, the FBI alleges. In later recorded conversations, Wertkin allegedly upped his asking price to $310,000 and outlined a detailed plan to exchange the money in person on Jan. 31.
The employee explained to Wertkin that he would send a colleague of his named “Bill” to meet Wertkin with the $310,000 in a Sunnyvale-area hotel on Jan. 31. Bill, however, was really an FBI special agent named William Scanlon, according to the criminal complaint.
On the morning of Jan. 31, Scanlon went to a Hilton Garden Inn in Cupertino, wearing a gray Titleist hat and carrying a blue duffel bag, following the plan hatched by Wertkin and the company employee during recorded phone calls. Shortly after Scanlon arrived at the arranged meeting spot, Wertkin, in his wig, sat down next to him and handed him the full FCA complaint, according to the criminal case.
“As a former trial attorney with the Department of Justice, I believe that Wertkin would have extensive knowledge of the qui tam process and would know that such complaints are filed under seal with the court until the court lifts the sealing order,” Scanlon said in the criminal complaint. “There is probable cause to believe that Jeffrey Wertkin unlawfully sought to sell the company a sealed FCA complaint in exchange for $310,000.”
Akin Gump isn’t the only firm to see a relatively recent lateral hire wind up in legal trouble. Former Kaye Scholer partner Evan Greebel resigned from that firm in March, a few months after a December 2015 criminal indictment. Greebel—who had joined Kaye Scholer in July 2015 from Katten Muchin Rosenman—was accused alongside his one-time client, former pharmaceutical executive Martin Shkreli, of using settlements and sham consulting agreements that caused $11 million in losses to biopharmaceutical firm Retrophin and investors. Greebel, whose alleged wrongdoing related to his time at Katten, has entered a not guilty plea and the case against him remains pending, with a trial scheduled to begin in June.
In 2012, former Nixon Peabody partner David Tamman was convicted on 10 criminal counts over his role in a Ponzi scheme that cheated investors, including members of Los Angeles’ Iranian-Jewish community, out of as much as $20 million. Tamman had spent more than two years at Nixon Peabody from 2007 to 2009, when he was fired amid a U.S. Securities and Exchange Commission investigation of one of Tamman’s clients. Tamman was later hired by Greenberg Traurig, only to be fired in early 2011, when the SEC began an administrative case against the lawyer.
A 2011 American Lawyer magazine article highlighted another lateral hiring cautionary tale involving former Winston & Strawn partner Jonathan Bristol, who pleaded guilty to money laundering conspiracy charges after admitting that he let his attorney escrow accounts be used by financial adviser Kenneth Starr to transfer money Starr stole from clients.
Taken together, the cases spotlight both the risks of lateral hiring and the limits of due diligence.
There may be no foolproof way to weed out potential problems, but a recent study by ALM Intelligence found that while most firms consider lateral hires an important part of their strategies for driving revenue growth, the vetting process surrounding those hires is often ad hoc and unstructured. And while firms typically try to assess an incoming lawyer’s business prospects, they trail behind other private employers when it comes to conducting screens such as psychological testing during the hiring process.
Note: This story has been updated to clarify that allegations against Evan Greebel stem from a period when he worked at Katten Muchin Rosenman.
Contact Scott Flaherty at email@example.com. On Twitter: @sflaherty18.
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