Lawsuit Pits Retired Founder Against His Firm

By Danny Jacobs

Even if a law firm institutes a mandatory retirement age, problems can arise once a lawyer must step aside. A legal dispute between John T. Enoch and the Baltimore firm he helped found, Goodman, Meagher and Enoch LLP, centers on compensation Enoch says he is owed since he retired in 2000 at the firm’s mandatory age of 72-and-a-half.

Enoch claimed he is owed more than $120,000 of his $300,000 retirement package, according to a lawsuit filed against the firm and its lawyers in March 2007. His attorney, solo practitioner Richard D. Paugh of Rockville, said the lawsuit was filed seven years after Enoch retired because the payment discrepancies did not come to light until then.

The firm filed a countersuit in April 2007, accusing Enoch of malicious use of process and bad faith. It also said Enoch actually owed the firm $800 that he was inadvertently overpaid.

Enoch’s lawsuit cites what is called the “Enoch Retirement Agreement” signed by him and the firm a month before he retired.

John Amato IV, who is both co-counsel for the firm and a defendant in the case, said the agreement allowed Enoch to stay on as an independent contractor with the firm, sharing fees for whatever work he did. The agreement was the culmination of discussions in the months leading up to Enoch’s retirement, a way to do “something extra” for one of the firm’s founders, Amato said.

Amato said Enoch’s lawsuit erroneously argues his personal agreement supersedes the firm’s 1997 partnership “buy-sell” agreement, which established the mandatory retirement age. The buy- sell agreement allows retiring partners to either take a $300,000 buyout and fully retire, or a $200,000 buyout and compete with the firm, Amato said.

The $300,000 figure in Enoch’s personal agreement was merely acknowledging Enoch’s decision, Amato said, adding he specifically included a paragraph saying the personal agreement would not supersede the “buy-sell” pact.

Further complicating the matter is the fact Enoch suffered a stroke on the day he retired. The firm gave Enoch disability payments, which Amato said are subtracted from the required retirement payout in accordance with the “buy-sell” agreement.

“It’s double-dipping otherwise,” he said.

Paugh said Enoch’s lawsuit was a business issue and not personal. (Enoch, through Paugh, declined to comment for this story.) Amato said he would believe that if Enoch had only filed suit on the partnership disagreements. But the fact Enoch sued individual members of the firm, when the “buy-sell” agreement specifically prohibits such personal obligations, makes it a “bad faith” issue as well, Amato said.

The lawsuit is particularly difficult for Amato, who considers Enoch his mentor. He is not looking forward to the August trial but will be prepared.

“It hurts me to be in this situation, but I think we are fully in the right,” he said.

Originally published by Danny Jacobs.

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