Reuben Guttman of Guttman Buschner & Brooks. February 19, 2014. (Photo: Diego M. Radzinschi/ALM)
Denying allegations that he stole a lucrative whistleblower client on his way out of Grant & Eisenhofer, former director Reuben Guttman on Tuesday accused the plaintiffs firm of rehashing old claims and using a recent breach-of-contract lawsuit to sully his reputation.
Represented by employment law boutique Outten & Golden, Guttman and his current firm, Washington, D.C.-based whistleblower boutique Guttman, Buschner & Brooks, filed several motions in response to a contract lawsuit Grant & Eisenhofer brought in August in D.C. federal court. The lawsuit seeks $7 million in damages, plus a share of a $280 million settlement in a False Claims Act whistleblower case in which drug company Celgene Corp. was accused of illegally promoting medications for off-label uses.
In a motion on Tuesday looking for dismissal or summary judgment, Guttman argued that Grant & Eisenhofer’s complaint repeats claims that the firm has already made elsewhere and distorts reality in a bid for legal fees it doesn’t fully deserve.
“This case arises out of the same events and seeks the same relief as three previously filed actions, two which remain pending and one which G&E voluntarily dismissed,” wrote Guttman’s legal team, led by Outten & Golden’s Susan Huhta and Cassandra Lenning. “G&E has made allegations that serve no purpose other than to damage defendants’ reputation and extort payment far in excess of G&E’s legal entitlement (if any) to its fees and costs. Many of G&E’s factual assertions are recklessly false.”
The D.C. complaint against Guttman came after Grant & Eisenhofer brought a parallel case in Los Angeles federal court against Beverly Brown, a former Celgene saleswoman who served as the whistleblower in the false claims suit. The California complaint also names as defendants the San Clemente, California-based law firm Bienert, Miller & Katzman, which served as local counsel in the Celgene case, and the firm of Columbia, South Carolina-based lawyer Richard Harpootlian, who was also involved in the whistleblower action.
Although Guttman was not a named defendant in Grant & Eisenhofer’s suit in California, much of the complaint’s claims related to his alleged actions, as do those in the D.C. case. Grant & Eisenhofer, represented by Paul Knight of Nossaman, alleges that Guttman—along with Brown and the other law firms involved in representing the whistleblower—conspired to deprive Grant & Eisenhofer of fees in the Celgene case.
The plaintiffs firm maintains that it advanced some $7 million in costs over the course of the whistleblower litigation and that it’s entitled to a portion of a fee award that is likely headed to Brown and her lawyers. With the $280 million Celgene settlement, Brown could be in line for a whistleblower award between $70 million and $84 million, according to the complaints.
“Guttman engaged in a surreptitious scheme to steal G&E’s client Beverly Brown,” the law firm wrote in its Aug. 24 complaint in Washington. “Guttman achieved his treacherous goal by misleading G&E into believing that, upon his departure, clients including Ms. Brown would be contacted jointly and given a free choice of how to proceed with their matters—in fact, Guttman used G&E’s reliance on these assurances as a means to engage in extensive, secret solicitation of G&E clients while still employed at G&E.”
In the responses filed in Washington on Tuesday, Guttman and his current firm present a far different account of the arrangement with Brown and of the late stages of Guttman’s stint at Grant & Eisenhofer. They argue that Brown stayed with Guttman after he left Grant & Eisenhofer because he had been the lead lawyer throughout the Celgene case and trusted him as her lawyer, not because he improperly solicited her as a client.
Guttman also took specific aim at allegations that he berated Grant & Eisenhofer staff members by email before leaving the firm, writing that his departure actually stemmed from being fed up with what he viewed as unethical behavior on the part of the firm’s leaders, Stuart Grant and Jay Eisenhofer. Guttman’s lawyers wrote that Grant had sexually harassed women associates at the firm, while Eisenhofer often pressured lawyers to settle cases, even when not in the interest of the firm’s clients.
Grant & Eisenhofer issued a statement responding to Guttman’s recent filings, saying that the claims in his court papers are “wildly untrue” and reiterating that the firm believes it has a clear right to a portion of the fees from the Celgene case.
“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 statement said. “The undisputed fact remains that Grant & Eisenhofer represented Beverly Brown for seven years and incurred more than $7 million in costs and fees in developing the case that ultimately led to her successful whistleblower award this past July.”