Houston’s Shrader & Associates has been experiencing things lately that seem more like the plot of a legal thriller than reality at a small toxic-tort firm.
In 2011, a former office manager at the firm, Tara Robertson Stevens, was charged with and indicted for felony theft for allegedly taking more than $200,000 from Shrader & Associates from May 16, 2007, through Aug. 17, 2011. Stevens’ arraignment has been reset three times, and she has a court appearance set for Feb. 7, described on Harris County’s online filing document system as a “disposition.”
But now the saga has entered the civil court. Shrader & Associates has filed a petition in Harris County state district court alleging Stevens provided “confidential, proprietary, and privileged information” from the firm’s computer server to Houston lawyer Savvas H. Stefanides and the firm Stefanides and Associates. [See the Shrader petition.]
On Jan. 30, 113th District Judge John Donovan of Houston signed a temporary restraining order in Shrader & Associates LLP v. Savvas H. Stefanides, et al. that bars Stevens, Savvas Stefanides, and Stefanides and Associates — along with “anyone acting in conjunction with them” including Gori Julian & Associates — from “making any use or disclosure of any information obtained, directly or indirectly, from Shrader [& Associates'] computer server or offices, including but not limited to any client files, document databases, or attorney work product.”
Shrader & Associates alleges in its Jan. 30 petition that it discovered in August 2011 that “Stevens had embezzled substantial funds” from the firm, but it didn’t learn until January that “Stevens provided confidential, proprietary, and privileged information from” Shrader & Associates’ computer server to Savvas Stefanides. [See "Houston firm's former office manager arrested, charged with felony theft"]
In an affidavit attached to the petition as an exhibit, Justin Shrader, Shrader & Associates’ managing partner, writes that he learned from Marilyn Stefanides, Savvas Stefanides’ wife and law partner, that what appeared to be “confidential work product” from the Shrader firm was on a Stefanides and Associates’ computer.
Among other things, Justin Shrader writes in the affidavit that on Jan. 23, Marilyn Stefanides told him that she and her husband met Stevens at a November 2011 funeral. Marilyn Stefanides relayed to Shrader that Stevens told the couple she had worked at Shrader & Associates and told Savvas Stefanides she would ” ‘teach’ him how to prosecute asbestos cases in exchange for his agreement to split the proceeds from prosecution of such cases on a fifty-fifty basis,” Shrader writes. [See the Shrader affidavit.]
Marilyn Stefanides told Shrader that after she learned Stevens was not a lawyer she advised Savvas Stefanides that forming a business relationship with Stevens would be a “bad idea” and she continued over the next few weeks to tell him she did not support it, Shrader writes in the affidavit.
However, Marilyn Stefanides told Shrader that Savvas Stefanides met with Stevens in December 2011 and hired Stevens as “director of marketing” at the firm, over Marilyn Stefanides’ objections. Marilyn Stefanides told Shrader she later saw files on a Stefanides and Associates computer that appeared to come from Shrader & Associates, such as a strategic marketing plan and PowerPoint presentations and spreadsheets “that appeared to be related to” Shrader & Associates’ cases and/or clients, Shrader writes in the affidavit.
Shrader writes that Marilyn Stefanides also told him that her husband met with Randy Gori, a shareholder in Gori Julian in Edwardsville, Ill., and executed an agreement in December 2011 to joint venture asbestos cases.
Marilyn Stefanides told Shrader, according to his affidavit, that her husband has no prior experience or client base in asbestos or other mass-tort litigation.
“Ms. Stefanides believes, based on her interactions with Stevens and S. Stefanides, as well as her review of information she discovered on [Stefanides and Associates'] computer servers, that it is their intention to use [the Shrader firm's] confidential and proprietary information to build such a practice in conjunction with Gori Julian,” Shrader writes in the affidavit.
Shrader writes that his firm never authorized disclosure of any Shrader & Associates work product to Savvas Stefanides or Stefanides and Associates. Apart from a “limited number of asbestos cases” in which Shrader & Associates and Gori Julian had served as co-counsel, the firm never authorized disclosure to Gori Julian.
In a voice mail message, Randy Gori says he and his firm have not signed an agreement with Savvas Stefanides.
Shrader writes that the potential damage to his firm and its clients from unauthorized disclosure “cannot be adequately quantified in, or compensated through, money damages alone.” The Shrader firm has “invested countless lawyer hours and substantial expense to developing its strategy and method of prosecuting asbestos cases and other mass toxic tort cases” and those provide the firm and its clients with a competitive advantage in litigation, he writes.
In its petition, the Shrader firm alleges misappropriation of trade secrets and confidential and privileged information, unfair competition by misappropriation, breach of computer security and conspiracy against Stevens, Stefanides, and Stefanides and Associates. The Shrader firm also brings a breach of fiduciary duty cause of action against Stevens and seeks injunctive relief against all of the defendants.
In the Jan. 30 TRO, Judge Donovan wrote, “There is a substantial likelihood that Shrader [& Associates] will succeed on the merits on its claims for misappropriation of trade secrets, unfair competition, breach of fiduciary duty, breach of computer security, and/or conspiracy,” Donovan wrote in the order.
The judge also signed an order granting expedited discovery to Shrader & Associates, including depositions of Savvas Stefanides and Stevens on Feb. 6. A hearing on the Shrader firm’s request for a temporary injunction is scheduled for Feb. 10.
Savvas Stefanides, Marilyn Stefanides and Justin Shrader each did not return telephone messages left at their firms. Stevens did not return a telephone message left at her home in Sugar Land. Stevens’ criminal-defense attorney, Terry W. Yates of Houston’s Terry W. Yates & Associates, says, “There’s more to the story.” Yates declines to respond further to allegations in the civil suit, because he does not know if he will represent Stevens in it. The Harris County online filing system does not list a lawyer for any of the defendants.
Justin Waggoner of Houston’s Smyser Kaplan & Veselka, who represents Shrader & Associates, declines comment except to say his client wants to protect the interests of the firm’s clients.