St. Denis & Davey, P.A.

Legal Malpractice Issues

Law firm involved in malpractice suit for financial misconduct

| Jan 2, 2020 | Legal Malpractice Law |

A major law firm with Florida clients is facing a lawsuit for legal malpractice after one of its lawyers allegedly misappropriated funds from a client’s company. The lawsuit against Akin Gump Strauss Hauer & Feld claims that the firm managed finances for a domain name company, Future Media Architects (FMA). According to the suit, FMA’s CEO was suffering from mental health issues and substance abuse problems at the time, leaving him to assign some of his own management duties to the law firm.

The complaint claims that the firm made poor financial decisions for the company in order to ensure that the lawyers’ own bills were paid. It alleges that in cases where a conflict of interest may arise, the firm did not hesitate to take action to protect its own interests, even at the cost of the company. For example, the complaint alleges that the firm made below-market sales to increase available liquidity. However, the suit alleges that the wrongdoing went far beyond these concerns. A senior counsel at the firm allegedly created joint bank accounts with the company and installed herself as its interim CFO.

As a result, the complaint alleges, the lawyer paid her own credit card bills and travel costs with company funds while getting paid through FMA accounts and those of a company she ran. The firm reportedly does not deny many of these facts, but it says that the senior counsel was dismissed after these activities were exposed and that FMA was reimbursed for all excess charges.

Many companies rely on their lawyers to provide helpful advice and reasonable guidance. Businesses that discover a lawyer has misled them or mismanaged their funds may consult with a legal malpractice attorney about their options to seek compensation.