Jim Ferraro's Cleveland Firm Files For Chapter 11.....in Miami.

The legal maneuvering continues in the long-simmering dispute between Jim Ferraro and the widow of the ex-partner of his Cleveland based law firm:

Kelley & Ferraro filed for Chapter 11 reorganization on Wednesday, Jan. 26, in a move that partner Tom Wilson said is aimed at resolving the nearly 5-year-old civil litigation pending against it.

The timing was not coincidental, Mr. Wilson said, as Wednesday was the day civil proceedings brought by Lynn Kelley, widow of firm co-founder Michael Kelley, were to resume in Cuyahoga County Common Pleas Court. Mr. Wilson said the bankruptcy filing automatically stayed the civil proceedings.

Currently, it's business as usual at Kelley & Ferraro, Mr. Wilson said. He said the firm filed for bankruptcy protection from creditors to do what's best for its clients.

The petition was filed in the Southern District of Florida, U.S. Bankruptcy Court, in Miami. Partner James Ferraro lives in Florida, and Mr. Wilson said bankruptcy counsel advised Kelley & Ferraro to file there.

Ms. Kelley's lawyer, Bill Wuliger, claimed Thursday that the firm's filing in Florida isn't “kosher” because the firm operates in Cleveland.

The bankruptcy filing is “extremely injurious” to Ms. Kelley and her son, and to the law firm and its clients, Mr. Wuliger contended. He called it an “atomic bomb on the Kelley family.”

“We're angry, we're upset, but we will survive and we will eventually, I believe, rectify the wrongs that have happened,” Mr. Wuliger said. 

 The case is before Judge Mark and you can see the docket here.

I hope Jim at least got a nice parking spot!

Wet Hot South Florida Morning.

Hey, what do you know -- Jeff Sloman's a plaintiff's attorney!

This great Julie Kay article on the perils of suing clients for unpaid fees is instructive, but I had another takeaway -- the perils of litigating issues instead of attempting to resolve them:

The litigation triggered the competitor, Fort Myers-based Storm Catcher, to ask the U.S. Patent and Trademark Office to re-examine Armor’s patents, which were ultimately deemed invalid.

The patent ruling destroyed Armor’s business, valued at more than $2 million, said Warren Trazenfeld, a Miami solo attorney who is representing Armor in the malpractice case.

“The patents were the most valuable part of the company,” he said. “Now the business’s valuation has been substantially affected.”

Trazenfeld claims the Squire Sanders lawyers should have requested a re-examination of the patents and could have fixed them in Armor’s favor. Instead, the firm deliberately headed into litigation to run up high legal bills, he alleges.

“It absolutely could have been an easy fix,” Trazenfeld said.

Litigation always has the potential to spin out of control, and always has the potential to result in unintended -- and even unforeseen -- consequences.

It's funny to see businesses that work so hard to contain and/or eliminate risk throw caution to the wind when they're embroiled in litigation (not that I'm complaining).

Besides the billable hour economic self-interest, why is reaching out early for a compromise resolution sometimes so difficult to do?

Swlip, this one's for you!

SFL Friday -- Heartfelt Apologies to All!

Well it's been an eventful week filled with mirth and merriment, and it's not even over yet.

I mean, just today Tiger read a statement about his sex life and Paul Penichet filed a lawsuit described as "a shakedown" by the (allegedly) very randy defendant, Casaurina owner Pete Halmos.

Then there's the mistrial just declared in Milt Ferrell's asbestos case.

But I was most fascinated by this story that Constant Complainer linked to about a Miami couple who were enticed by monetary incentives and land grants to move to rural North Dakota, where they discovered that midwestern small-town love:

Hay bales, a gas station and a graveyard greet visitors as they roll into Hazelton off the state highway.

Michael Tristani came from his native Florida wearing gold necklaces and a Rolex and driving a Lexus. He proved as foreign as a flamingo in a place where pickups, farm caps and flannel shirts are de rigueur.

"People thought I was a drug dealer," he said.

And that's probably being generous.

Hey, don't feel so bad -- I believe the last Jew to live in that area was played by Gene Wilder and rode in on a horse.

Well kids I'm off to put on my hermetically-sealed windsurfing gear, so stay warm this weekend and eat lots of red, yellow and green food (but then if you're a Star Trek geek you already know that).

Have a great weekend!

Nice Parking Spot!

Signs/schmigns, who cares?

Jim Ferraro's SUV parked outside the Courthouse this morning.