February 28, 2006
Fees, Ratification and Rock & Roll
In the 1970s, Edward King retained attorney Lawrence Fox to represent him against MCA and Lynyrd Skynyrd in a series of disputes over royalties. As the Second Circuit explains (to be read in a Casey Kasem voice or, alternatively, in the voice of the narrator from VH1’s Behind the Music):
Edward King became a member of Lynyrd Skynyrd, a rock band that achieved great success in the 1970s and whose music is still well known today. While a member of Lynyrd Skynyrd, King played guitar and co-wrote several of the band’s biggest hits, such as the southern anthem “Sweet Home Alabama.” The band’s 1973, 1974, and 1975 albums each went gold, and MCA signed Lynyrd Skynyrd to an exclusive recording agreement in 1974. But eventually the band’s hard partying and physically violent internal conflicts became too much for King to bear. One night in May 1975, when Lynyrd Skynyrd was on tour, King quit the band and let the tour[.]
When King showed up broke, King and Fox entered into a contingency fee agreement. Fox agreed to represent King for one-third of all the recovery of any royalties past due and for one-third of all of King’s future royalties. The parties then embarked on an attorney-client relationship that lasted well over 20 years, during which Fox represented King in three separate actions to recover royalties. King alleges that Fox misrepresented certain aspects of the arrangement, including implying that it was required by court order. The allegations are too nuanced and delicate to fully recount, but the case -- the story -- is certainly worth a read.
In 1997, King sued Fox, alleging that the original contingency fee agreement was unconscionable, and claiming breach of fiduciary duty, unjust enrichment, undue influence, conversion and attorney misconduct. King demanded payment of royalties improperly collected by Fox plus interest, as well as punitive damages and rescission of the fee agreement. Because the authorities on the issues are “divided and scant” the Second Circuit has certified the following three questions to the New York State Court of Appeals:
(1) Is it possible for a client to ratify an attorney’s fee agreement during a period of continuous representation?
(2) Is it possible for a client to ratify an attorney’s fee agreement during a period of continuous representation if attorney misconduct has occurred during that period? If so, can ratification occur before the attorney has committed the misconduct?
(3) Is it possible for a client to ratify an unconscionable attorney’s fee agreement?
Stay tuned for the Court's answers.
[Meredith R. Miller]
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