A Chicago intellectual property law firm has sued one of its former attorneys and a former client, demanding they pay $5 million for their roles in an alleged scheme to siphon off business from the firm to its ex-attorney.
On May 11, the firm of Meroni & Meroni P.C. filed suit in Cook County Circuit Court against ex-Meroni lawyer Christopher J. Scott and former Meroni client World Richman Manufacturing Corporaton, its CEO David Huang and Richman employee Iordanka Koleva Mulhern, identified as an employee “in charge of patents and trademarks” for Richman.
According to the lawsuit, Scott had worked for the Meroni firm since 2001, first as a paralegal, and eventually as an associate attorney at the firm. In 2007, the complaint said, Scott requested and was granted status as a “1099 worker,” working as an attorney for the firm. He continued in that role until May 2015, when he left the Meroni firm. The complaint said Meroni formally terminated Scott’s position with the firm in June 2015.
The complaint said, after Scott left the firm, Meroni “learned that for many years both as an employee and then as a 1099 worker, Scott … performed substantial amounts of work for Meroni clients independently of his position with Meroni and that he billed those clients personally, and obtained payments from those clients that should have been made to Meroni.”
The lawsuit alleged Mulhern and Richman aided Scott in these alleged actions by allegedly obtaining bids from Meroni for work related to “specific patent and trademark applications,” but would then hire Scott on the side “to pursue those patent and trademark applications at a reduced hourly rate.”
The lawsuit specifically alleged Scott had received at least $56,000 in legal fees from Richman in 2014 using such tactics.
The complaint asserts Scott used similar tactics to secure “business from numerous Meroni clients.” The complaint listed more than a dozen other intellectual property filings Scott allegedly completed on the side for Richman and other Meroni clients through the years. But Meroni’s lawsuit asserts Meroni believes there are still more Meroni clients whose work Scott allegedly coopted.
“… Scott was able to provide Meroni clients with lower billable rates because he had no overhead as he was using the offices, equipment, office supplies, paralegals and secretaries of Meroni,” the complaint alleged, accusing Scott of performing “legal work for his own account during the hours that he was supposed to be working for Meroni” earning “hundreds of thousands of dollars that should have been paid to and received by Meroni.”
Meroni is represented in the action by attorney John J. Pappas Sr., of The Pappas Law Group LLC, of Chicago.
Cook County Case No. 2017L004798