An attorney facing possible sanctions for prolonging a contractual dispute between her former firm and Kleinbard claimed at a Thursday hearing that she had good reason to reject Kleinbard’s attempt to resolve the matter.
But her testimony did not seem to go over well with the judge.
U.S. District Judge Paul Diamond of the Eastern District of Pennsylvania appeared to grow frustrated with attorney Julie Negovan as she sought to explain why she refused Kleinbard’s offer of payment to her client and former law firm, Griesing Mazzeo, in a dispute over a subcontracting agreement between the firms.
Throughout the sanctions hearing, Diamond pushed back against Negovan’s testimony, taking issue with indirect answers and Negovan’s claims that she couldn’t remember certain details. And Diamond made his dissatisfaction known, at one point telling Negovan, “I’m glad you find this amusing. Please answer the question, and don’t try to litigate an answer.”
Negovan asserted that she had reason to believe Kleinbard’s offer did not sufficiently compensate Griesing Mazzeo for its claims, but Diamond seemed skeptical.
Diamond had already determined that Griesing Mazzeo’s objections to Kleinbard’s offer were unfounded in an April ruling that noted, “It is difficult to accept Griesing [Mazzeo] acted in good faith when it refused that payment.”
Following the April ruling, Kleinbard moved for sanctions against Negovan, accusing her of drawing out the litigation in bad faith.
“Kleinbard was trying to give your client what they wanted in this case,” Polsinelli shareholder Patrick McCabe, representing Kleinbard, said to Negovan at the Thursday hearing. “They tried to pay you. You refused it. I’m trying to establish why.”
Griesing Mazzeo first sued Kleinbard in 2022, alleging that the Philadelphia-based midsize firm used Griesing Mazzeo’s diversity certification to obtain six-figure contracts from the state and subsequently stiffed Griesing Mazzeo of the contractually agreed 20% of the legal fees paid from those contracts.
Following the filing of the suit, according to court filings, Kleinbard confirmed with the Office of General Counsel that it owed $26,418 to Griesing Mazzeo and sent that amount to the firm alongside an offer of judgment. But Griesing Mazzeo turned down the offer.
Negovan on Thursday cited several bases for her decision, including a spreadsheet from the OGC predating its final determination of fees owed reflecting that Griesing Mazzeo was subcontracted on a project that was not accounted for in Kleinbard’s offer. Although an attorney with the OGC said in a deposition that the spreadsheet had been incorrect, Negovan maintained that Griesing Mazzeo was owed fees for the project.
Negovan additionally contended that Kleinbard’s offer was inadequate because it only compensated Griesing Mazzeo for legal fees, while Griesing Mazzeo was also seeking interest and damages for the experience lost from not being permitted to perform the 20% of the work it was subcontracted for. However, Negovan was unable to quantify the specific value of the damages she had sought on behalf of her client, prompting criticism from the judge and opposing counsel.
“It seems to me that there was some mystical number that your client would consider full relief,” McCabe said.
Negovan asserted that Kleinbard had made higher offers during settlement talks, but that those offers were not documented and she could not recall their exact amounts.
“That’s your testimony?” Diamond asked, calling into question the claim that Negovan refused the offer based on a number she could not remember.
“I don’t remember the different numbers,” Negovan responded. “Your honor, I don’t remember, I’m sorry.”
The dispute over sanctions is not yet over, as the parties have further evidence they did not have time to present Thursday. The hearing was continued to a yet-undetermined date.
Until recently, Negovan had been an attorney with Griesing Mazzeo, but in August she parted with the firm to practice full time in Florida.