In a recent dispute over legal fees, US District Court Judge Patricia Tolliver Giles sided with Clare Locke, affirming an arbitrator’s decision that the law firm was owed $7 million by a former client, Kytch Inc. Bloomberg Law reported.
The arbitrator’s order mandated freezing of funds from a prospective multimillion-dollar settlement between McDonald’s Corp. and Kytch Inc., a company that provided service for McFlurry machines at McDonald’s restaurants.
Arguably, the company did not meet the high legal standard for the overturning of the decision, as confirmed by Judge Giles. Clare Locke had previously represented Kytch in several trade secrets and additional litigation, involving a $900-million lawsuit against McDonald’s Corp. Relations soured when Kytch terminated its contract with Clare Locke after four of the firm’s lawyers left in August 2023 to start their own law firm.
Clare Locke claimed that, having invested “more than 10,000 hours” and “countless long days and late nights” in Kytch’s affair with McDonald’s, the breakaway lawyers—now operating as Meier Watkins Phillips Pusch—would potentially pocket millions of dollars in fees from the McDonald’s and other Kytch litigation.
Kytch was represented at the hearing by Daniel Watkins of Meier Watkins, a former Clare Locke lawyer, who accused his previous law firm of using the dispute to disclose confidential information about Kytch. Watkins also suggested probable violation of a legal ethics rule by Clare Locke which refrains attorneys from revealing client-related information without the client’s informed consent.
Nevertheless, the ruling secured the arbitrator’s decision in place while the tug-of-war over legal fees and costs related to the firm’s representation of Kytch continues. The case is registered as Clare Locke v. Kytch, 24-cv-00545 (E.D. Va., 4/4/24), order 5/14/2024.