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Florida Fourth DCA rules that in computing amount of a law firm’s charging lien which was based on work done by attorney who was not an equity partner, the amount of the lien should be determined on a quantum meruit basis

On October 2, 2019, in Parker Waichman LLO v. R.J. Reynolds Tobacco Company, No. 4D18-3239, the Florida Fourth DCA affirmed a trial court order which had based the computation of a law firm’s charging lien in an Engle-progeny tobacco case on a quantum meruit methodology rather than awarding the entire contingency fee. The attorney for the plaintiff law firm was an associate in Florida of an out-of-state firm who was the firm’s sole Florida licensed attorney. After the law firm received a letter from the Florida Bar contending that it was engaging in the unlicensed practice of law in Florida by operating a Florida office and not having a Florida licensed partner, the law firm named the associate a partner. However, he was not made an equity partner and neither his role nor his lack of entitlement to profits changed. After he subsequently left the firm, taking the client involved in this case with him, the law firm claimed it was entitled to the entire contingency fee in the case. The Fourth DCA observed that the law in this area has been summarized in Buckley Towers Condo., Inc. v. Katzman Garfinkel Rosenbaum, LLP, 519 Fed. Appx. 657, 661 (11th Cir. 2013), which explains that a firm’s right to contingency fees earned after the attorney-client contract is terminated varies depending on the relationship between the initial firm and the subsequent firm representing the client. When there is no connection between the two firms, the initial firm is entitled to a quantum meruit award, limited by any agreement to a maximum fee award. When an associate attorney at the initial firm exits the firm and the client follows the associate to a new firm, the initial firm is also entitled to this limited quantum meruit award. However, when a partner exits the initial firm and the client follows, the initial firm is entitled to the entire contingency fee, less the former partner’s partnership share. The Fourth DCA concluded that the departing attorney was essentially a limited partner who should be treated like an associate for purposes of the charging lien rules.