Hunton & Williams has gotten much criticism for its recently revealed partnership with three security companies, during which some company employees discussed using covert operations to undermine labor activists.
But the same e-mails that disclosed the law firm's partnership also demonstrate that it was at times a rocky alliance. The security companies, which hoped to work as subcontractors for Hunton & Williams’ clients, including the U.S. Chamber of Commerce, worked for weeks without getting paid, the e-mails say. Frustrated, one company employee eventually accused the law firm’s partners of contradicting each other about what the compensation would be.
The e-mails offer a rare public look at a potential subcontractor’s negotiations with a major law firm.
On Feb. 3, Patrick Ryan of Berico Technologies, one of the three security companies, wrote to colleagues about a “long-overdue talk” he had with Hunton & Williams partner Robert Quackenboss, whom he called “Bob Q.” Ryan reported that the law firm was “unable/unwilling” to pay costs for the first phase of the companies’ work.
“Bob Q was under the impression we were willing to do this work at risk and then present jointly with H&W to the Chamber. I was very clear in telling him we had a different understanding based on multiple conversations with others at H&W,” Ryan wrote. The other conversations, he wrote, were with partners John Woods “and/or” Richard Wyatt Jr.
Quackenboss apologized, Ryan wrote, “for the confusion/misunderstanding” but made clear that the law firm wanted the potential subcontractors “to share the risk with H&W up-front.”
The potential upside for the three companies, calling themselves “Team Themis,” was big. A Nov. 16 e-mail discussed the companies splitting $2 million in monthly payments for six months. Later, the amount under discussion was described as $250,000 a month for “enduring work.” The Chamber of Commerce said this month it has paid nothing to the security companies and knew nothing of the tactics they were proposing.
The more than 71,000 e-mails became public this month after hackers calling themselves “Anonymous” broke into the servers of HBGary Inc., one of the three companies. The e-mail that has gotten the most attention is a Nov. 29 discussion about ways to “discredit” the union-backed U.S. Chamber Watch, including the creation of a forged document and “fake insider personas.”
Hunton & Williams has declined repeated requests for comment on the e-mails. Kevin Zeese, a peace advocate who signed ethics complaints two years ago against 12 former Bush administration officials, said last week that he plans to file complaints with the D.C. Bar against Hunton & Williams lawyers involved in the project for the Chamber.
The e-mails show the three security companies — Berico, HBGary and Palantir Technologies — were discussing a cost proposal for Hunton & Williams on Nov. 5. They had just met with Woods, a partner in Hunton & Williams’ Washington office, and at Woods’ request, they came up with a “Phase I” cost of $200,000, according to an e-mail by Ryan.
On Nov. 8, Ryan wrote again to the team and sounded optimistic that they would get paid for any work. Woods had said by phone that Hunton & Williams, not the Chamber, may cover “initial upfront costs,” Ryan wrote.
But two months later, after the companies had done research for Hunton & Williams and put together initial recommendations, they still had no agreement on who would pay for what. Ryan wrote to his colleagues in a Jan. 9 e-mail that he was working on a new cost proposal and that “all of the partners had agreed to lower our cost to be more in line with what they’re” — Hunton & Williams — “currently getting from the Chamber.”
In Ryan’s e-mail on Feb. 3, finally delivering news that the companies would not be paid for their initial work, Ryan concluded that the project could be worthwhile nonetheless.
“We still see this venture as something that has massive potential for the future and have already invested a great deal of time,” he wrote. “At this point, we feel that another 2-3 weeks of work to produce a fairly straightforward demo is worth our time and effort.”
The team had hoped to present to the Chamber during the week of Feb. 14, Ryan wrote.