Lawsuit Claims Kasowitz Firm Bilked Client on Legal Fees 

FORT LAUDERDALE, Fla. (CN) – A company says the exorbitant billing practices of prominent attorney Marc Kasowitz’s firm while representing the company in a string of securities cases “represent everything that is wrong with the legal  profession,” according to a lawsuit filed in Florida.

In a lawsuit filed in Broward County Circuit Court, Patriot National claims Kasowitz Benson Torres, a law firm led by President Donald Trump’s private counsel Marc Kasowitz, allowed its staff to “engage in outrageous misconduct” when billing for work on a set of investor lawsuits filed against Patriot.

Patriot says one Kasowitz employee somehow managed to bill it for 24 hours of purported work in one day — “every waking moment.”

“Together, he and his like-minded Kasowitz colleagues billed Patriot National 154.4 hours for a single non-trial day. The next day afforded the client no relief, with at least five Kasowitz billers charging Patriot National for preparation of binders,” the June 30 complaint says.

“On another occasion, [the firm] billed Patriot National 2.7 hours for the otherwise non-billable task of e-filing a document,” the company says.

The firm ended up charging Patriot more than $3.4 million in legal fees in less than a year, often generating invoices for work that was redundant or unnecessary, Patriot claims.

“Despite holding itself out as being skilled in complex commercial litigation matters, [the firm] spent an inordinate and unreasonable amount of time researching basic hornbook legal principles and drafting two pages of skeletal and threadbare affirmative defenses,” Patriot says.

Patriot — a provider of administrative, underwriting and outsourcing services for  the insurance industry —  allegedly had to hire new attorneys because the Kasowitz firm was not approved by Patriot’s liability insurer.

When Patriot sought new counsel, it says, the firm threatened to impose a lien “in an attempt to extract even more money” from the company.

Replacement counsel was allegedly forced to redo a large amount of the firm’s work, causing Patriot to incur additional legal fees.

Obtained by Courthouse News from Broward County court records, Patriot’s June 30 complaint against Kasowitz Benson Torres lists counts for fraud, legal malpractice, breach of contract and breach of fiduciary duty.

“Instead of receiving legal services commensurate with a law firm that represents the President of the United States, [Patriot] was subjected to fraudulent billings, malpractice, and other egregious misconduct that has caused millions of dollars in damages,” the complaint reads.

According to the pleading, Patriot has paid Kasowitz Benson Torres roughly $2 million in legal fees out of the total amount charged.

In response to the lawsuit, Kasowitz Benson Torres issued a statement to Courthouse News, saying Patriot’s claims of overbilling are “without merit.”

“All of our billing was entirely appropriate, covering expedited motion practice and discovery in three cases in which we represented the company.  Further, Patriot National never objected to any of our bills or work throughout our representation of it,” the statement reads.

“We will vigorously defend our firm against Patriot National’s frivolous claims, and look forward to resolving these issues in court.”

According to the firm, the company’s claims represent “an attempt to distract from the fact that the firm sued Patriot National in New York State court two months ago based on the company’s failure to honor its express written agreement to pay our outstanding legal fees.”

In that case, Kasowitz Benson Torres alleges that following its termination as Patriot’s counsel in Feb. 2017, Patriot expressly agreed to pay the legal fees charged. It never fully satisfied the outstanding invoices, and more than a million dollars is still owed to the firm, according to the New York complaint.

Widely known for his role as outside counsel for President Trump in the Russian election-meddling investigation, firm head Marc Kasowitz has been described as the “toughest lawyer on Wall Street” by CNBC and by Bloomberg as “an uberlitigator,” according to the firm’s marketing materials. He’s handled a bevy of landmark financial cases, including a sprawling lawsuit to defend monoline insurer MBIA’s restructuring, as well as the Federal Housing Finance Agency’s action against several banks over mortgage-backed securities misconduct, which resulted in a $1.25 billion settlement with Morgan Stanley.

The Patriot pleading did not name Kasowitz as one of the lawyers who supposedly overbilled Patriot. It did, however, assail Kasowitz for recounting his accolades on the firm’s website, claiming his firm profile shows a “wave of unabashed bravado.”

Patriot claims it did not get the “top-flight” legal representation that prospective clients would expect based on the achievements touted in the profile.

The underlying litigation in which the firm represented Patriot included cases filed against the company in New York federal court by investment funds Hudson Bay Master Fund Ltd. and CVI Investments, respectively.

According to a company SEC filing, Hudson Bay and CVI accused Patriot and its chairman Steven Mariano of breaching contracts involving the delivery of certain price adjustment warrants.

Patriot National’s stock, trading at $1.75 a share as of noon Monday, is hovering around multi-year lows.

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