Firm that worked with Girardi Keese will handle gas leak cases

The law firm that worked with Girardi Keese to represent plaintiffs in the Porter Ranch gas leak litigation will handle the cases on its own in accordance with an agreement reached between the firm and Girardi Keese's trustee. Plaintiffs attorneys say they expect the cases to net a settlement of $1 billion to $2 billion.

Under the agreement, if they are victorious, Girardi Keese's estate would receive 45% of the fees. Its co-counsel, Frantz Law Group APLC, would receive 55%, according to the firm's representative, Quinn Emanuel Urquhart & Sullivan LLP partner Kenneth R. Chiate. The two firms represent more than 8,000 plaintiffs. Southern California Gas Leak Cases, JCCP4861 (L.A. Super. Ct., filed Feb. 2, 2016).

But an agreement allegedly brokered last fall between Girardi Keese and another firm, Abir Cohen Treyzon & Salo LLP, which is commonly referred to as ACTS, may complicate how the gas leak cases proceed. A letter obtained by the Daily Journal, which ACTS sent to Girardi Keese and Frantz Law Group's Porter Ranch clients last week, informed the plaintiffs that ACTS "previously agreed to assist GK with your case" and "can assume full responsibility for your case under the same fee arrangement you entered into with GK."

The letter stated Robert W. Finnerty, a partner at ACTS who previously worked at Girardi Keese, would lead the team working on the gas leak cases.

On Monday afternoon, Elissa D. Miller of SulmeyerKupetz APC, the trustee appointed to handle Girardi Keese's finances, filed an adversary proceeding against ACTS. The complaint alleges ACTS is wrongfully in possession of Girardi Keese's client list, and improperly used it to solicit the gas leak clients "in violation of the ethical rules governing lawyers in California." Miller v. Abir Cohen Treyzon Salo, LLP, 2:21-ap-01019-BR (C.D. Bankruptcy Ct, filed Jan. 25, 2021).

"ACTS wrongfully stated that it was the debtor's successor and falsely implied that it had the blessing of the court to approach the debtor's clients," the complaint stated. "The trustee is informed that a number of the gas leak clients have clicked on the link in the email and signed retainer agreements with ACTS based on the wrongful statements in the email. ... there is no mention in the e-mail of the continued involvement of Frantz as their co-counsel of record."

The action follows a cease and desist letter Chiate, Frantz Law Group's counsel, sent to ACTS on Friday. The letter alleged that ACTS is aware the gas leak plaintiffs are already represented by Frantz Law Group, but solicited the clients anyway in violation of California's Rules of Professional Conduct.

In an interview Monday before the adversary proceeding was filed, Finnerty, the Girardi Keese attorney who has since joined ACTS, said that under the agreement ACTS reached with Girardi Keese last fall ACTS would have worked alongside Frantz Law Group on the gas leak cases. "The Girardi firm ... associated the ACTS firm into the cases, and at that time Girardi Keese was not capable of continuing to represent the clients," Finnerty said. The plan was for ACTS to take over Girardi Keese's position, he said.

"We're very disappointed in Mr. Frantz's behavior," Finnerty said, referring to Frantz Law Group founder James P. Frantz. "I was one of the attorneys that Frantz utilized to sign up many of his cases, and now to act as if we're interlopers as opposed to assets to the case is a little bit disappointing."

"I think we made it abundantly clear we don't have any intention or desire to step on anybody's toes," Finnerty added.

Finnerty confirmed ACTS received the cease and desist letter from Frantz Law Group. The firm responded to Frantz Law Group Sunday night, he said.

As of press time, both Frantz Law Group and ACTS had scheduled virtual town halls for the plaintiffs at 6 p.m. on Monday, to discuss how they plan to handle the gas leak cases. Regina Bagdasarian, an attorney at Frantz Law Group, confirmed Monday that Miller, Girardi Keese's trustee, planned to attend the firm's town hall. The firm also planned to talk about the conflict with ACTS, Bagdasarian said.

Finnerty said ACTS also plans to inform attendees of its dispute with Frantz Law Group at the firm's own town hall.

In addition to Finnerty, ACTS has hired four other attorneys from Girardi Keese, including Joseph Finnerty, Michael P. Kelly, Samantha K. Gold, and Brianna Y. Franco.

A U.S. Bankruptcy Court judge ordered Girardi Keese and Thomas V. Girardi into Chapter 7 bankruptcy in mid-January. Earlier this month, Girardi's brother also filed a petition in Los Angeles County Superior Court to appoint a temporary conservator for the embattled attorney.

In December, Girardi was accused in a federal lawsuit of embezzling settlement funds that belong to the victims of the 2018 Lion Air crash. Edelson PC v. Girardi et al., 20-CV07115 (N.D. Ill., filed Dec. 2, 2020).

Thomas Girardi called the Daily Journal Monday. He said he had not taken any compensation from the Girardi Keese law firm for two years, and that he had not taken any money from the victims of the Lion Air crash.