The ex-chairman of the dissolved firm Nelson Levine de Luca & Hamilton, who has made it known that he wants to take his former partners to arbitration, is arguing that he has no obligation to state his claims in court.
In documents filed Oct. 6, Michael Nelson acknowledged his former partners’ arguments that his complaint made no specific claims regarding the breakup of the firm. But he said their motions to dismiss and motions for summary judgment should not be granted because his pleadings are not relevant to the question of arbitrability.
“Requiring the parties to air their ‘dirty laundry’ in publicly filed court pleadings would undermine the purpose of their agreement to use the PBA program,” Nelson argued in his opposition to the motion for summary judgment, referring to a Pennsylvania Bar Association program designed to resolve disputes among lawyers.
Nelson, now a partner at Eversheds Sutherland in New York, sued his former partners in July seeking to arbitrate claims arising from the dissolution and liquidation of the firm, the duty to contribute capital, the allocation of profit and loss, withdrawal of shareholders and duty to indemnify. All of the matters stem from the former partners’ operating agreement and buy-sell agreement, according to his complaint, filed in U.S. district court in Philadelphia.
But defendants David Brown, Daniel de Luca, Kenneth Levine, John Clark, Michael Hamilton, William Krekstein, Claudia McCarron and John Mullen, in various filings, contended that Nelson’s claims were unclear. Clark filed a motion for summary judgment. Levine and de Luca filed a motion to dismiss, as did McCarron and Mullen separately, and Hamilton. Krekstein and Brown each filed answers with affirmative defenses.
Nelson argued that under the federal rules of notice pleading, he only needs to plead the existence of an arbitration agreement, and that there is a dispute over the partners’ operating or buy-sell agreement.
“To require Mr. Nelson to detail the claims in a public pleading—or anywhere, prior to the defendants having bound themselves, by their signatures, to the confidentiality rules of the PBA program—would serve no purpose, and would undermine the parties’ agreement to air their disagreements only in the confidential setting of the PBA program,” Nelson’s attorney, Michael LiPuma, wrote in the filing.
Clark’s motion also noted that Nelson previously sought arbitration, in a New York case between the firm and its former landlord, over Nelson’s cross-claims against the defendants. In that case, a New York judge denied his request for arbitration. But in his opposition to Clark’s motion, Nelson said, his latest claims are broader than the ones at issue in New York.
Many of the defendants are representing themselves in the litigation. McCarron declined to comment on the case. Levine, de Luca, Hamilton, Krekstein and Brown did not respond to requests for comment. Neither did Nicholas Jajko of Mullen Coughlin, who is representing Mullen, or Michael Savett of Clark & Fox, who is representing Clark.
Brown and Hamilton are now practicing law at Goldberg Segalla in Greensboro, North Carolina, and Philadelphia, respectively; Krekstein is at Timoney Knox in Fort Washington; Mullen and McCarron are at Mullen Coughlin in Wayne; Clark is at Clark & Fox in Cherry Hill, New Jersey; and de Luca and Levine are at de Luca Levine in Blue Bell.
Lizzy McLellan writes about the Pennsylvania legal community and the business of law at firms of all sizes. Contact her at email@example.com. On Twitter: @LizzyMcLellTLI.