Reducing $300,000 Demand to $60,000 Pre-Litigation

In a commercial contract dispute involving executive-recruiting fees, the firm reduced a client’s asserted exposure by 80% before the client entered litigation.

The firm represents Irth Capital, the Qatari-backed investment firm recently reported to have submitted a $1.5 billion bid to acquire Papa John’s. The dispute arose from a recruiting agreement under which an executive-search agency claimed entitlement to a fee after Irth hired a candidate whom the agency had initially introduced for a different, junior-level position.

The agency initially demanded $120,000. Months later, the agency engaged a regional powerhouse firm to demand $300,000. We were retained to intervene.

Intervention

We rejected the $300,000 demand outright and challenged both the legal and factual basis for any recovery, let alone the demanded amount.

Among other defects, the firm identified a material disconnect between the position for which the candidate had been introduced and the position the candidate ultimately accepted, deficiencies in the agency’s fee calculation, and drafting problems in the engagement letter that undermined any expectation of obtaining a straightforward recovery under an account-stated theory.

The parties held a brief settlement call. We remained firm on our position rejecting the agency’s valuation of the anticipated claims and demand for $300,000.

Exposure Reduced

Two months later, the client received notice of the agency's suit for breach of contract seeking $60,000—just 20% of its last demand, a substantial reduction from the initial $300,000 demand.

The firm has moved to dismiss the remaining claim. Regardless of the ultimate disposition, the client entered litigation with its asserted exposure already reduced by $240,000 without paying a settlement.