Patton Boggs and one of its former partners are the targets of a malpractice suit filed Tuesday in New York.
James McNair, currently a partner at Reed Smith in Falls Church, represented the plaintiff, Endurance Financial International, LLC, from 2008 through 2010. During that time, McNair, then a partner with Patton Boggs, allegedly failed to inform Endurance about laws governing the sale of insurance in Texas.
Endurance was in the business of selling group life insurance to both wealthy individuals and pension funds. The financial company hired McNair to help guide them.
According to the complaint, "As part of its engagement, which continued through and including June 2010, Patton worked on securing patents relating to the Specialized Insurance Programs, advised on investor disclosure issues, and counseled on jurisdictions whose insurance and related laws would permit EFI to recruit potential insureds as envisioned. Patton charged more than $1.6 million for its work."
In 2009, McNair identified Texas as a good state in which to sell people Endurance's insurance. At McNair's suggestion, Endurance then spent $1.4 million to develop the insurance program and concurrently sought investors, only later to discover that Texas prohibits outside companies from soliciting insurance inside the state, according to the complaint.
"Upon information and belief, McNair failed to mention the statute in his initial conversations with EFI because neither he nor his colleagues had to that point researched the issue, a stunning oversight given that so many of EFI’s proposed activities were to be Bermuda-based," the complaint read.
McNair's allegedly researched the Texas statute after it was brought to his attention, but did not consult his Patton colleagues in the Texas office. Endurance is seeking no less than $4 million in damages. Neither McNair nor Patton immediately responded to a request for comment.