Taylor Joynson Garrett is being sued for up to £465,000 by a former client, who claims the firm was negligent in the way it settled litigation.
Taylor Joynson is in turn suing the client for unpaid fees.
US management consultancy Kepner-Tregoe Inc and its UK subsidiary Kepner-Tregoe have issued a High Court writ, claiming that the firm was negligent in its advice and in breach of the terms of its retainer.
Kepner-Tregoe instructed Taylor Joynson in 1993 on a dispute with three of its former employees and their new employer Trinity, advised by Penningtons.
Former managing partner Richard Marsh, Susan Judges and John Linneker, among others, were the partners conducting the case at Taylor Joynson.
The main dispute was eventually settled but Kepner-Tregoe claims that when it later attempted to sue the employees and Trinity for breach of copyright, it found that Taylor Joynson's settlement agreement precluded this. It had to settle and Taylor Joynson's fees for the action were £465,000.
Partner Lawrence Abramson at Harbottle & Lewis has issued the writ for Kepner-Tregoe.
Taylor Joynson issued the following statement: "Back in the beginning of August we issued proceedings against Kepner-Tregoe for unpaid fees. They have subsequently issued a writ against us.
"In reality it is basically a defence to the claim we are making against them for the unpaid fees.
"We are applying for their action against us to be discontinued on 20 October 1998 and are confident that we will succeed."