LeBoeuf says not guilty

LeBoeuf Lamb Greene & McRae will attempt to overturn the verdict of a Manhattan court which found it guilty of legal malpractice in favour of former client Sheraton Corp.

Sheraton, advised by Mayer Brown Rowe & Maw, is understood to be claiming as much as $21m (£12.7m). Now owned by Starwood Hotels & Resorts Worldwide, it brought a broad action asserting mishandling of a 1999 case by a senior LeBoeuf associate. However, trial judge Justice Gammerman limited the case to the way the firm defended Sheraton against a claim for punitive damages. The jury ruled that the hotel chain could recover this part of the award.

The jury in the underlying case, which charged Sheraton with improperly profiting from a volume purchasing plan, had returned a $50m (£30m) verdict in 1999 against Sheraton. An appeal of the verdict, which was subsequently reduced to $30m (£18m), is pending. Approximately $17m (£10.3m) of the $30m was allocated to punitive damages.

A LeBoeuf statement said Gammerman has now asked for a briefing on the jury’s findings that the firm committed malpractice by withdrawing a reliance-on-counsel defence to the punitive claim. It expressed confidence that the jury’s verdict would be set aside and stood by the performance of its lawyers.

Starwood general counsel Kenneth Siegel countered that the underlying verdict was “the result of bad lawyering, not bad behaviour on the part of Sheraton”.