US law firm gave erroneous advice on Cuban embargo, former client claims
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| Published on Saturday, January 12, 2008 |
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By Lindsay Fortado
NEW YORK, USA (Bloomberg): Morgan, Lewis & Bockius, the largest Philadelphia-based law firm with 1,400 attorneys, gave advice regarding sales to Cuba under the US trade embargo that led to a criminal investigation, a lawyer for an ex-client has argued.
Dan and Stefan Brodie, the founders of Purolite Corp., a manufacturer of specialty resins for water purifiers based outside Philadelphia, sued Morgan Lewis in 2004 for legal malpractice. The case began in the early nineties when an accountant questioned a sale by Purolite's Canadian subsidiary to a company in Cuba. Purolite claims Morgan Lewis attorneys repeatedly advised them that the sales were legal because there was no US involvement.
"Morgan Lewis's malpractice, sloppy work and their bad advice cost Purolite and the Brodies and it cost them severely," said Marc Kasowitz, a lawyer for the brothers, in opening arguments on Friday in state court in Philadelphia.
In 1996, the US Customs Service began an investigation into Purolite's sales to Cuba. Morgan Lewis told the inspectors that the company's foreign subsidiaries were separately owned and advised the Brodies to continue doing deals with the Cuban company, leading to a criminal indictment by the US Attorney's office in Philadelphia, Kasowitz said.
In 2002, the Brodies were convicted of making illegal trades to Cuba, a verdict that was later reversed on appeal. The Brodies and Purolite pleaded guilty to charges concerning reimbursement of travel expenses, the company said in court filings.
A lawyer for Morgan Lewis said the firm advised the company not to sell to Cuba and that Purolite continued to do so because they wanted the money.
"The advice we gave was proper and it was correct," William O'Brien, a lawyer for Morgan Lewis, told the jury. "They made millions of dollars. That's what this case was about."
Morgan Lewis, whose clients include Citigroup Inc., Blockbuster Inc., American Airlines Inc., Mitsubishi Motors Corp. and Apollo Management LP, is the 12th largest US law firm, according to the National Law Journal, a legal newspaper. |
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