2. Fee Agreement. In the event of any financial recovery as a result of the efforts of KF&G, the law firm will be entitled to a contingent fee equal to 40% of the net recovery, after expenses.
3. Expenses. The Client will bear all expenses, not to exceed $50,000 in total, which sum will be wired to the account of KF&G as a retainer, to be deposited to the firm’s Client Trust Account, to be debited as expenses are incurred.
4. Nature of Commitment to Provide Services; No Guaranty of Success. KF&G agrees to exercise reasonable best efforts, without any guaranty of success, to investigate the matters outlined herein, either using its own staff or third parties selected by KF&G, in its discretion. Fees and expenses of third parties will be paid from the expense retainer. KF&G will provide the Client written status reports no less often than monthly. The Client understands that due to the complexity of this situation, the time which has passed since the incident, and the various governments involved, it may not be possible to fulfill this engagement within the agreed expense limit and, further, that it is possible that the retainer will be used without obtaining any positive results.
5. Publicity. KF&G is authorized to use whatever media sources it desires, in its discretion, to publicize the investigation, during the term of this engagement and at any time thereafter. The Client hereby releases KF&G from all normal obligations of confidentiality.
6. KF&G’s Right to Terminate Services. KF&G is specifically authorized to stop providing services, at the firm’s option, at the earlier of (a) 90 days after the retainer is received, or (b) at such time as the expense retainer is exhausted. Upon notice to the Client of its decision to provide no further services, KF&G shall provide a report of its progress to date, without any commitment to continue to provide additional services, which will be in the full discretion of the law firm. Should KF&G provide any additional services beyond the initial 90-day period or exhaustion of the expense retainer, that will not constitute a waiver of its right to terminate this engagement and will not in any event constitute an agreement by KF&G to provide additional services.
7. Client’s Right to Terminate Agreement. The Client retains the right to terminate KF&G’s services at any time, upon written notice, and to receive a refund of any unused expense retainer (less any accrued and unpaid expenses). However, should the Client thereafter receive any financial recovery based in whole or in part on any information provided to Client by KF&G, KF&G will be entitled to a fee based upon the reasonable value of its services. If the parties cannot agree on a fee, the matter shall be submitted to binding arbitration by three arbitrators, with each party selecting one arbitrator and the two arbitrators selecting the third arbitrator. The fees of the arbitrators shall be shared equally by the parties.
“I think that fairly captures what we’ll try to do for you, and how we’ll be paid. I threw in the possible wrongful death action, just in case there’s no evidence that he survived and the crash report confirms pilot error. Maybe the charter airline did a bad job screening the pilot and he had a bad flying record; there could be some liability on the part of the officers and directors. The statute of limitations has probably expired, but we should check it anyhow.”
“David, it all looks very clear, and very fair, to me. I understand that in ninety days you may just tell me that you have done what you can and my money has been spent, but I am very hopeful. Where do I wire the money for the expenses?” Maria Theresa asked.
“I’ll have that information e-mailed to you Monday morning. Could you please fill in your home address, phone number, and e-mail address right here at the bottom? If we both sign this original, I’ll make a copy for you back at the hotel later this afternoon and leave it for you at the front desk.”
They both signed the agreement, then Winkler tucked it into his wallet and said, “If you need to get in touch with me before our first report, here’s my business card. I hope we can find some useful information for you; we’ll certainly do our best.”
“I know you will. Something tells me you are the best person I could have asked to do this for me. But please be careful.”
CHAPTER 11
THE MANAGEMENT COMMITTEE’S REGULAR MONTHLY MEETING was scheduled to take place the first day Winkler got back, and there was no way he could avoid it. The meetings started at nine in the morning, the first Tuesday of each month, in the large conference room.
Kelly, Friedman, and Green, the firm’s founders, had broken off from one of the city’s largest law firms some fifty years ago. Since those humble beginnings, the firm had grown from five attorneys to sixty, plus as many secretaries and support staff. As its size increased, the partners became acutely aware of the need for periodic reporting and monitoring of new cases, and progress on pending matters.
Though new matters were accepted by the firm on a daily basis, at the monthly meetings every major case was supposed to be reviewed by the Management Committee as to current status, resources required, and major strategy decisions. The meetings usually ran from one to two hours, depending on the depth of discussion. Each department head was supposed to present a brief written report on every new case and the status of every pending case.
Routine matters were skipped over in the oral discussion; large, complex cases were given most of the time. Contingent fee cases, which were rare, were supposed to be fully presented to the Management Committee, at a special session if necessary. The rules required a full review of likely resources required, source of disbursements for expenses, and probable outcome before any partner could agree to take the case.
Pro bono cases, on the other hand, were evaluated more superficially based upon the need for legal counsel, the inability of the individual or organization to pay legal fees, and potential public relations exposure for the firm. The firm annually committed to provide a certain number of hours of free legal work so it could remain on the State Bar’s Pro Bono Honor Roll, a status symbol among the larger firms.
Rather recently, however, the meetings had begun to take a nasty turn: The firm’s bottom line profitability had become the month-to-month focus. As the economy spiraled downward, major corporations had started to put their legal work out to bid, and many of them were demanding rollbacks of the firm’s hourly billing rates. Some large companies refused to pay for expenses such as photocopying, faxing, and online legal research, which were previously a profit center.
Someone could be expected to mention the ever-increasing figure for accounts receivable, which had to be monitored closely to make sure cash receipts kept flowing. In the firm’s nearly fifty-year history, there had never been a month where cash receipts didn’t at least cover the monthly “nut” to pay the rent, keep the lights on and the associates and staff paid—and they wanted it to stay that way. The partners had represented too many younger law firms that had gone heavily into debt for expansion and to pay partner draws, and they didn’t want to slip into oblivion as those firms had.
Representation of Maria Theresa Romero was certain to raise eyebrows, and Winkler wasn’t really looking forward to what he expected would be a heated discussion. He knew he shouldn’t have taken it as a contingent fee case without Management Committee approval. The prospects for recovery were so slim—they were probably negligible—he shouldn’t even have considered it on that basis, even though there was a hefty retainer for out-of-pocket expenses.
Could he pass it off as a pro bono case? It didn’t neatly fit into that category either. Where were the legal issues? Why were the services of a lawyer required at all?
Was the firm in the business of looking for dead people? Or missing ancestors? Or helping helpless maidens find their roots? He could anticipate a barrage of questions.
Ultimately, he expected it would come down to money. Since Winkler couldn’t say there was even a faint hope of finding the banker alive, he’d be engaged in a fruitless search, with no likely upside. The retainer would simply come in and go out for computerized research and outside investigators. His time—and the
time of any other attorneys and legal assistants he’d put on the case—would be written off. And all this while other billable files sat on the corner of his desk, gathering dust.
Word about the case had already gotten around the firm, as Winkler had faxed in the retainer agreement and the $50,000 retainer had already been wired into the firm’s Client Trust Account. Also, during his call to the office for wire transfer instructions, he’d requested a conflict check. He hadn’t thought about how his partners would react to the information on the conflict sheets that ended up in the mail slots of every attorney and legal assistant:
Client: Maria Theresa Romero
Address: Avenida de la Independencia 244, Montevideo, Uruguay
Nature of matter: Research into disappearance/death of father, Argentine banker, Ricardo Guttmann, believed killed in 1976 air crash in Mexico, connected with $200+ million banking irregularities and collapse of worldwide banking group; research status of Argentine expropriation of Guttmann properties and current status of title; research possible wrongful death action against charter airline involved in air crash (name to be determined) and related statute of limitations.
Adverse parties: Not yet determined. Possibly governments of Argentina, Belgium, Luxembourg, and Israel; charter airline owner/operator (name to be determined).
Fee arrangement: $50,000 retainer for out-of-pocket expenses only; contingent legal fee @ 40% of any financial recovery.
Damn! Even Yvonne, the always fashionably-dressed thirty-something receptionist, seemed aware of the hot water Winkler was in. As he dashed by her on the way to the conference room, she looked up from her switchboard and gave him a knowing smile. “David, you forgot your bulletproof vest!”
He opened the large French doors of the conference room and saw the six other members of the Management Committee seated around the twenty-foot long table. It was a minute before nine, and he was the last to arrive.
“Good morning, ladies and gentlemen.”
Winkler always took a semi-formal approach to these meetings. He’d been a partner for more than thirty years, and a member of the Management Committee for more than twenty years, but he still felt a certain distance between him and the other members.
Tom Kelly, senior partner, always acted as chairman of the Management Committee meetings and could be expected to start the discussion on a matter of fact basis, but then open it up for pot shots by others.
“Pour yourself some coffee, David, and we’ll get down to business. We’ve been chatting about this new case you took on—we saw a brief description in the conflict sheet, and the $50,000 retainer just hit the Client Trust Account yesterday. But since you were on vacation, none of us have had an opportunity to talk with you about it.”
“Well, Tom, it’s a fascinating case with some significant potential for the client, and the firm, but admittedly, it’s a long shot. I certainly didn’t intend to monopolize the meeting by a discussion of this case, but I’m open to all your questions and would be happy to start with an overview.”
“That’s fine, David, take a few minutes and fill us in.” Kelly and the others were obviously interested, though Winkler knew their patience would last no more than ten minutes.
Ever since his fateful meeting with Maria Theresa Romero, Winkler had been thinking about how to summarize the facts, issues, and compelling reasons why the firm should take the case—which he’d already done—and why he shouldn’t be given too much grief for doing it.
“In essence, it’s an investigation into the death of Ricardo Guttmann, an Argentine banker who’s believed to have died in the crash of a private charter jet on a flight from New York to Acapulco back in 1976. The client is Maria Theresa Romero, a citizen of Uruguay. Her mother died a few weeks ago, and Ms. Romero found evidence in her mother’s personal papers that she was adopted and was told Guttmann was her birth father.
“She inherited some money and is willing to use $50,000 of that to fund the investigation. As you’re aware, she’s already wired that amount to our Client Trust Account as a retainer, for out-of-pocket expenses only. She doesn’t have much, and since it’s an extremely long shot, I agreed we would take the case on a 40% contingency.”
“Why do you say Guttmann was ‘believed’ to have died in the crash?” Abe Friedman was the next to chime in. His background as a trial lawyer included a dozen years in the Department of Justice, handling major white collar prosecutions.
“The press reported that he died in the crash, but there was speculation that he may not have been on the plane, that it was a set-up to make it look like he died. It’s actually one of those ‘small world’ stories.” Winkler felt uneasy providing all the details, since the coincidence of his prior relationship with Guttmann’s empire and the chance meeting with Maria Theresa Romero were still bothering him. But he had no choice and continued.
“At the beginning of my career, I represented Guttmann when I practiced law in Europe. I never met him, but I was involved with his banking empire as European counsel. I followed the news stories and speculation after the crash. Within weeks after the crash, Guttmann’s banks around the world all failed, and there was a lot of talk that maybe he wasn’t on the plane, that he conveniently disappeared. There were even reports that he’d been seen alive in Spain and Cuba. Very quickly, however, interest waned, and frankly I got involved in other things and lost track of it.
“What I do recall is that the bodies on the plane were all charred beyond recognition, but Guttmann’s family acknowledged his death and had his remains cremated immediately. It seemed strange to me at the time. I wondered how they could be so sure it was him, and so quickly. But it was done, and we just responded to inquiries about his companies after that.
“We’re going back decades, but I clearly recall that after Guttmann’s death—or disappearance, to leave the matter open for now—his banks on four continents all failed within short order. The auditors found ‘holes in the books’ representing over $200 million in questionable transactions; the money had been taken out of the banks to offshore entities about which there was little or no information. Gone. That’s certainly what fueled the speculation that maybe he’d set up the crash to cover his tracks. It wouldn’t be the first time someone had done something like that.
“The law firm I was with at the time had absolutely no idea what was going on. We just did the corporate work, formed holding companies, and negotiated acquisitions.”
Abe Friedman jumped back in. “So, the speculation about his death or disappearance was connected to the $200 million in ‘banking irregularities’ you referred to in the conflict sheet?” Friedman’s experience in financial crimes caused him to probe further into the monetary aspects of the case. He attempted to analyze the situation objectively but couldn’t help taking on a sarcastic tone. He put his hands on his temples, looked down at the conference table, and closed his eyes in concentration. After a long pause, he continued.
“So here we are, several decades later, our little law firm, with its own financial challenges, getting into bed with the possible heiress to a huge illegal fortune. A fortune, even by today’s standards—that much I will admit—which was allegedly stolen by a man who’s conceivably alive but probably dead. A man who—if he is alive—has managed to keep a low profile all that time and evaded police and prosecutors on four continents for over four decades.
“And our law firm, with its clientele of blue-chip corporations and conservative individuals of wealth who prefer to stay off the front page of The Wall Street Journal, has agreed to look for him, for 40% of an amount which, if I were a betting man, I would give you ten-to-one odds—hell, let’s make that a hundred-to-one—you’ll never find.” Friedman’s voice rose, and his face turned red.
“And if you do find him, and if there is any money—which is really a separate issue—then it’s highly doubtful the fortune will belong to him or, for that matter, to her—and remember that she’s the client, because it wasn’t his money in the first plac
e! Do I have that right, David?”
Friedman could make even the Ten Commandments look foolish. His years of grilling witnesses on cross-examination gave him the ability to make you doubt anything. When you had him on your side, it was great, but God help you if he’d decided your case wasn’t worth pursuing.
That goddamn Friedman, Winkler thought, he’s doing it to me again.
It was alright for the litigators to pour a million bucks of time into a case, lose the case, and then write off the fees; nobody so much as raises a peep. It’s okay if he puts a couple of associates onto a case defending a country club friend accused of skimming money from a public charity and considers that pro bono. But if someone else takes on a pro bono case and it’s not for his favorite charity or one of his “good ol’ boy” clients, then there’s always hell to pay.
All eyes were on Winkler. Trickles of sweat dripped down his chest, anger swelled up inside him, and he was ever-so-close to speaking his mind—but then he remembered how he’d survived this long in the practice of law, and in this firm.
Calm down. Breathe deeply. Distinguish the chicken salad from the chicken shit.
He remembered this often-repeated admonition given to him over the years by Joshua Green, one of the founders of the firm, who was sitting at the other end of the table and thus far had been silent.
Forget your ego, and keep your eye on the ball.
It was as if Green was beaming this advice directly into Winkler’s mind, without uttering a word.
Winkler knew his partners well enough to know the firm would be skeptical about his taking the case. His primary objective was to keep the Management Committee from forcing him to back out, and only secondarily to keep them from mocking his good judgment. He just had to deflect their attacks and hang on for the ride.
To Save the Nation Page 6
