A Chinese businessman accused a former high-ranking administrative law judge of committing legal malpractice yesterday in the opening statements of a bench trial at the U.S. District Court for the District of Columbia.
Kevin So, a cosmetics manufacturer from Hong Kong, hired Washington solo practitioner Leonard Suchanek in July 2006 to represent him in July 2006 after he was victimized in an international Ponzi scheme. Suchanek, who retired as chief judge of the General Services Administration’s Board of Contract Appeals in 1992, allegedly failed to inform So of several conflicts of interest. So ultimately lost the suit, and he is now seeking more than $3 million in legal fees and expenses. The trial began Dec. 7 before Senior Judge James Robertson.
Reston, Va. solo practitioner David Tripp began his opening statement on behalf of So by saying that his client had been the victim of an “exceedingly complex” fraud that was “not dissimilar to the Bernie Madoff affair.” In short, So alleges: He was convinced by a long-time friend, a Canadian named Lucy Lu, to invest roughly $30 million in a purported bond trading deal in England. He signed an agreement with a company called Land Base, run by California businessman Boris Lopatin, to transfer the money to an HSBC Bank account located in London. Another man, Michael Brown, was supposed to execute the trades. Instead, Brown allegedly absconded with the money, and HSBC filed suit against the investors in England to prove it was not at fault.
That was where Suchanek came into the story. According to Tripp, Lu and So hired him to assist with the HSBC suit. Suchanek was supposedly recommended by Lopatin. (Lopatin allegedly told them that a “powerful” American judge wanted to help them.) But according to Tripp, Suchanek had already done legal work in the case for Lopatin, against whom So may have had legal claims; the former judge had also been hired by another investor caught in the fake bond deal whose interests may have clashed with So’s; and for an assistant, he had hired a woman who had previously worked for a company that benefited from the scheme.
The tale was confusing. Tripp jumbled several dates and, after a couple of confused questions from the judge, was forced to go back over his chronology.
Brian Shaughnessy, a partner with Washington-based Shaughnessy, Volzer & Gagner who represents Suchanek, wasted little time cutting to the chase in his remarks.
“The thing you have to understand about Mr. So is he’s a liar,” Shaughnessy said. He called So’s story line a “concoction” to try to recoup inflated damages. He said that Suchanek had helped So recoup roughly $15 million of his lost money, and had negotiated a $9 million settlement with HSBC, which So allegedly rejected on the advice of another firm.
“Had So taken Judge Suchanek’s advice, we would not be talking about large amounts of money, but just two or three million dollars net loss on an investment,” Shaughnessy said.