Former LeClair Ryan execs reach $10M settlement
Firm founder, CEO, others reached agreement with bankruptcy trustee and insurer
Former executives at Richmond-based LeClair Ryan PLLC have reached a settlement with the firm’s insurer and bankruptcy trustee over $10 million in pending claims, according to a report from The American Lawyer.
The firm’s liability insurer, Columbia Casualty, agreed to pay the firm’s trustee, Lynn Tavenner, $9.425 million to resolve claims including conspiracy and breach of fiduciary duty, as well as $575,000 to satisfy claim expenses, reaching the firm insurance policy’s $10 million limit. Tavenner, Columbia Casualty and 26 defendants, including firm founder Gary LeClair, CEO Eric Gustafson and former general counsel Lori Thompson, reached the agreement during a Nov. 16 conference.
Tavenner’s representation has asked federal judge Kevin R. Huennekens of the U. S. Bankruptcy Court for the Eastern District of Virginia to expedite the approval of the settlement on Nov. 29. If Huennekens approves, Columbia Casualty will pay Tavenner by Jan. 28.
The settlement will not affect Tavenner’s claims against UnitedLex. Tavenner has alleged that UnitedLex’s alleged unauthorized practice of law and misappropriation of funds cost LeClairRyan at least $41.7 million, for which she is seeking triple damages.
The 26 defendants include a group of 13 former LeClair Ryan directors and officers. In October, they moved to consolidate their cases with the case against UnitedLex, with an April 2022 trial.