PITTSBURGH — Prominent Western Pennsylvania plaintiffs’ lawyer Bruce Carlson continues to haggle over the rights to millions of dollars in legal fees with his former firm, Specter Specter Evans & Manogue.
Carlson was co-lead counsel in a class action lawsuit against Community Bank of Northern Virginia. However, following a $24 million settlement that granted more than $2 million to Carlson, who left SSEM during the case, SSEM filed a breach of contract action, claiming Carlson ignored separation agreement terms dictating he could keep only 20 percent of the first $2 million payable to the firm and 35 percent of anything beyond that.
Earlier this year, the U.S. Court of Appeals for the Third Circuit bounced the matter back to the Allegheny County Court of Common Pleas. The firm filed an amended complaint on Jan. 14; Carlson responded with preliminary objections on Feb. 22. On April 1, the firm filed a reply to those objections, but in so doing, Carlson said, improperly introduced new factual matters.
In an April 16 motion, Carlson said the firm “could have chosen to file a Second Amended Complaint in response” to his preliminary objections, but by not doing so “waived its right to assert new facts of record at this time.” He accused the firm of “attempting to sidestep” his preliminary objections — which didn’t raise any new facts — and said he shouldn’t be compelled to respond while his initial filing is pending.
SSEM responded to those objections with an opposition brief offering extensive detail about Carlson’s history as an SSEM employee and his June 2004 decision to break off and form his own firm along with Gary Lynch, who is a named defendant in the action, along with Carlson Lynch LTD and Carlson Lynch Sweet Kilpela & Carpenter.
“A reading of the entire Separation Agreement shows that where SSEM intended to waive any interest it may have had in the attorneys’ fees awarded in a particular case, that intent was set forth clearly and unequivocally,” the firm wrote, adding the June 30 separation contract superseded any preceding agreements on fee sharing.
“Carlson wants this Court, as he wanted the District Court, to extricate him from a deal which he voluntarily undertook but which simply did not turn out as good as he had hoped,” the firm continued.
“Carlson was an experienced class action lawyer. He knew that class action litigation is risky and that some cases take a lot more work than others. Sometimes you make a lot of money. Sometimes you don’t.
"He voluntarily and specifically assumed the known risk that there might be a lot more work involved after he took the case with him and the deal might not be as good as he thought it would be. The Separation Agreement specifically and by its language accounted for that. But Carlson cannot expect this Court to get him out of a bad deal.”
Carlson is represented by lawyers from Burns White LLC, of Pittsburgh.
Stanley M. Stein, of Pittsburgh, is representing SSEM.