Defense Questioning Sparks Fireworks at Alston & Bird Legal Malpractice Trial
A co-manager of the plaintiff, a family-owned company, erupted when lead defense lawyer Richard Robbins asked about his litigious relations with other members of his family.
February 22, 2018 at 03:22 PM
6 minute read
With the plaintiff's portion of the Alston & Bird legal malpractice moving into its final stages, jurors got a chance to hear from the brothers and co-managers of the family company accusing the law firm of allowing their older sibling to allegedly steal $1.5 million from Hatcher Management Holdings.
Company co-managers Jerry and Barry Hatcher testified Wednesday that they trusted their older brother, Maury, and Alston & Bird partner Jack Sawyer to protect the company's interests and only found out about Maury's alleged theft after getting corporate records that were withheld when he was the manager.
The defense intends to argue that the blame for any damage to the company should lie at the feet of the younger brothers and other family members. The defense claims the family was aware Maury was considering cashing out his shares and resigning and could have reviewed his handling of company finances at any time.
The defense has also pointed to letters and emails indicating a deep-seated animus between Maury and his younger brothers, particularly Jerry.
In one of several contentious exchanges with lead defense attorney Richard Robbins, Jerry Hatcher—himself a personal injury attorney—shouted and half-rose from the witness chair as Robbins questioned him about other legal tussles within the family.
At one point, Fulton County Superior Court Judge Schwall excused the jury and instructed Jerry Hatcher to regain his composure.
The dispute centers on Sawyer's role in helping draw up the operating agreement for the family business in 2001 and on the law firm's relationship with Maury Hatcher in 2008 and 2009, when he cashed out his interests in the company for an inflated price.
After Maury said he was resigning, Jerry and Barry called a family meeting and had a majority of the company's members vote them in as co-managers. After the brothers finally reviewed the corporate records, they claimed Maury paid himself about $500,000 in management fees and cashed out his shares for a price he set himself.
In 2009, the company and several family members sued Maury, who failed to appear for trial. In 2013, the court entered a default judgment against him for more than $4 million. He never paid it and is not a witness in the ongoing trial.
Hatcher Management sued Alston & Bird in 2013 for legal malpractice and breach of fiduciary duty, arguing Sawyer knew about Maury's plans to cash out and that he and Alston & Bird partner Nowell Berreth helped him keep company records under wraps until he could move to Florida with his ill-gotten gains.
Alston & Bird's team includes Robbins, Jeremy Littlefield and Jason Alloy of Robbins Ross Alloy Belinfante Littlefield.
Barry Hatcher was also questioned by Alloy on Wednesday about notes he took at a family meeting in 2008 that indicated Maury was considering selling back his shares.
“Did you ever contact Alston & Bird about a conflict of interest?” Alloy asked.
No, said Barry.
Alloys asked about a searing letter Jerry drafted to Maury after his resignation that claimed he was a “gossipmonger” and that the family was tired of his “ego-driven” pontification about the family business.
Barry Hatcher said he suggested editing out the more inflammatory language because “I didn't think it was appropriate for a business letter.”
On redirect, lead plaintiffs attorney, Harmon Caldwell, asked whether Jerry's sometimes harsh communications with Maury might be the result of his frustration.
“Does Jerry have a habit of blowing off steam?” asked Caldwell of Caldwell Propst & DeLoach.
“Yes, that's probably true,” Barry said.
His brother's propensity to vent was on display when Jerry took the witness stand.
Under Caldwell's questioning, Jerry portrayed his relationship with Maury as one of love and admiration and said he initially had confidence in Sawyer's representation.
“I felt good about it, because Jack was there saying it was appropriate,” Jerry said.
It was in 2008 that he began “butting heads” with Maury over the latter's refusal to reveal how much was in his capital accounts and reluctance to make dispersals.
Maury claimed Sawyer told him the account and financial information were off-limits, Jerry said.
“He kind of blasted me,” said Jerry, recalling that he considered leaving, thinking “then I'll be totally free of this tyrant.”
Instead he stayed and informed Alston & Bird early in 2009 that he and Barry were co-managers and instructed them to get Maury to turn over the corporate books.
A few weeks later, Alston & Bird arranged to have all the records delivered.
Robbins questioned Jerry on his “good, loving relationship” with Maury and his litigious dealings with other family members.
“You've had a lot of litigation with family, haven't you?” asked Robbins, pointing to the lawsuits against his brother, another lawsuit filed by his sister and her husband against the company and a recent probate matter.
Jerry erupted at the mention of his sister's lawsuit, raising his voice and declaring the couple provided the defense with records and a transcript “we didn't know about, sir!”
“I've dealt with a lot of lawyers over the years,” said Jerry. “A lot of them are a lot easier to deal with than you.”
“I'm going to have to agree with that,” said Robbins as the jury laughed.
Jerry again blasted Robbins.
“This is my life, Mr. Robbins. It's not a game,” he boomed.
“It's not a game for Alston & Bird either, Mr. Hatcher,” Robbins said.
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