A settlement between law firm Jenkens + Gilchrist and disgruntled investors over tax shelter duds has revealed J+G earned $93 million in fees over four years, with $19 million a year going to one partner.

Tax law can be lucrative. Just how lucrative can be seen in a proposed settlement between a law firm and disgruntled investors who sued the firm after they were sold tax shelters that were invalid.

A tax partner in the Chicago office of the law firm, Jenkens & Gilchrist of Dallas, earned $93 million in fees from 1999 through 2003, according to people who have seen documents in connection with the proposed settlement of the class-action litigation being overseen by the Federal District Court in Manhattan. That would average out to nearly $19 million a year for the partner, Paul Daugerdas.

Much of that income came from his work designing and selling questionable tax shelters to more than 1,100 investors, as well as writing legal opinions declaring the shelters valid, when they were later found not to be, according to the people who have seen the documents. The judge in the case has ordered the documents labeled confidential until a settlement is completed. Patrick Dorton, a spokesman for Mr. Daugerdas, wrote in an e-mail response to a reporter’s questions: “Mr. Daugerdas has complied with all of his professional ethical obligations and responsibilities as an attorney at Jenkins & Gilchrist. All the tax work performed by Mr. Daugerdas was completely consistent with the tax law at the time and was vetted by other tax experts inside and outside the law firm.”

The details that are emerging from the court documents cast a fresh light on the multibillion-dollar market for questionable tax shelters, which last ramped up in the mid-1990’s and is now under intense government scrutiny. The documents show how the Chicago office of Jenkens & Gilchrist was at the center of that trade.

That office’s tax practice, led by Mr. Daugerdas, generated $267 million in fees from its work on tax shelters, according to the people who have seen the court documents.

Of the $267 million, $83 million went to the firm. Another chunk went to Mr. Daugerdas and two other lawyers at the firm. Nearly $50 million went to the financial and accounting firms that carried out the complex financial transactions for the shelters. An additional $8 million went to Mr. Daugerdas’s former employer, the law firm of Altheimer & Gray of Chicago, according to people who have seen the documents. Altheimer & Gray dissolved in summer 2003.

Tax Analysts, a trade publication, reported on its Web site yesterday that Jenkens & Gilchrist reaped “in excess of $250 million.”

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