Quinn Emanuel Urquhart & Sullivan, LLP v Michael Berguin

Mr. Horwitz represented Michael Berguin in a lawsuit filed by Quinn Emanuel based on breach of personal guaranty. Quinn Emanuel claimed that Mr. Berguin owed it just under $1,500,000 in legal fees and about $500,000 in interest on those legal fees. Quinn Emanuel had defended Renaissance Stone, Inc., in a federal court litigation, and, when Renaissance Stone could not keep up with the legal fees, Mr. Berguin signed a personal guaranty of those fees. Quinn Emanuel continued to represent Renaissance Stone through trial, where, despite the plaintiff’s expert’s opinion of around $2m in damages, the jury awarded the plaintiff over $15m.

Quinn Emanuel claims to have ceased representing Renaissance Stone in November 2007, and, therefore, its late February 2011 lawsuit was timely. Mr. Horwitz argued that the statute of limitations started in early February 2007 when Quinn Emanuel filed a Motion for Leave to Withdraw as Renaissance Stone’s counsel. The motion was denied.

Mr. Horwitz also presented the position that Quinn Emanuel had agreed to release Mr. Berguin from his guaranty in exchange for the payment of $441,980.20 and having Renaissance Stone enter into a new engagement agreement. Quinn Emanuel argued that, in order to be released, Mr. Berguin also had to provide a pretrial retainer of $250,000 60 days before trial, and ensure that all monthly invoices were timely paid. Quinn Emanuel had documented the position asserted by Mr. Horwitz, but had not documented its additional conditions anywhere.

Quinn Emanuel further claimed that, if it did release Mr. Berguin, the release was fraudulently induced. Quinn Emanuel’s position was that Richard Schirtzer, head of Quinn Emanuel’s complex litigation committee, whose clients include IBM, Charles Schwab, General Motors and Toyota, who boasted of a billion dollar settlement in one of his cases, who supervises the Quinn Emanuel accounting department, handles higher level banking issues, approves company bonuses, reviews company financials before they are sent to the partners, is comfortable reviewing complex financial statements for public companies, and has done financial litigation for 25 years, was duped by Michael Berguin, a concrete contractor from Arizona, into believing that Mr. Berguin would remain responsible for Renaissance Stone’s legal fees even after Mr. Schirtzer released him from his guaranty.

Quinn Emanuel represented Samsung against Apple, where Samsung received an adverse billion dollar jury award. Quinn Emanuel represented Mattel against Bratz, where Mattel received an adverse $88 million dollar award. Quinn Emanuel represented Renaissance Stone against El Dorado Stone, where Renaissance Stone received an adverse $15m jury verdict. When Quinn Emanuel’s own money was at stake due to a reciprocal attorney’s fee clause in the underlying agreement, it dismissed its case against Michael Berguin for a waiver of costs.