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Virage Capital Says Pierce Bainbridge – $70 Million in Debt – Double Dipped on Collateral

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Virage Capital Says Pierce Bainbridge - $70 Million in Debt – Double Dipped on Collateral 4

Dan Garner – Back in August 2019, LawFuel was the first legal publication to raise concerns about the finances at Pierce Bainbridge Beck Price & Hecht LLP.  In an article in Forbes, ex-partner Don Lewis said: “I was illegally expelled for speaking up. UCC liens, filed in March, show a ‘$9,157,072.95 default’ to Pravati. . .If used responsibly, which was not the case at my former firm [Pierce Bainbridge], litigation financing is a fantastic tool to increase access to justice.”

LawFuel subsequently reported that the firm may have engaged in the questionable practice of “loan stacking;” as it turns out, in a recent court filing in Texas, litigation funder Virage Capital, has essentially validated those concerns. 

The Virage filing says Pierce Bainbridge not only defaulted, but also used the collateral pledged to Virage to secure funding from a cash advance lender.  Virage moved to intervene in the lender’s Texas lawsuit against Pierce Bainbridge to assert its priority interest.  Law360 previously reported that Pierce Bainbridge owes Virage an “estimated $65 million.”

Virage alleges: “Creative Capital Funding entered into various agreements with Pierce Bainbridge to purchase various accounts that served as Virage’s collateral.” It would appear Pierce and Pierce Bainbridge also re-pledged the alleged Virage collateral with three other cash advance entities, including Karish Kapital, reportedly owed in the aggregate around $4,500,000 by Pierce, Pierce Bainbridge and/or John Mark Pierce Enterprises and related entities.  

Heavy Duty Pierce Bainbridge Clients

The law firm that has serviced clients Rudy Giuliani, Don Lemon, Carter Page, Michael Avenatti, Tulsi Gabbard, Carter Page and George Papadopoulos, appears increasingly to have been more of an ongoing scam, than a legitimate legal operation. 

The notion of Pierce as a lone wolf, does not seem plausible. Indeed, a group of former Pierce Bainbridge attorneys at Hecht Partners are facing accusations of engaging in a shell game. 

The firm has eight lawyers, seven used to work at Pierce Bainbridge.  The seven attorneys consist of five former Pierce Bainbridge partners, Hecht, Max Price, Janine Cohen, Kathryn Lee Boyd and Connor McDonough, and certain Pierce Bainbridge support personnel have also joined the “new” firm.

Unusually, firm ‘founder’ David Hecht recently appeared on signature blocks for both Pierce Bainbridge and Hecht Partners in a less than ten-day period. One was for Pierce Bainbridge in an action involving Southwest Airlines and Boeing, the other in an action where Hecht Partners represents – along with another firm unrelated to Hecht Partners, Cole, Scott & Kissane, P.A. – a software developer named Corellium in a dispute with Apple in respect of a copyright claim over the sale of cloned software.  

Bergman and Denver Edwards, is a member of the Middlebury College Board of Trustees.

Each of the partners (with the exception of Denver Edwards) started on or before October 2018.  None of them left until at least February  2020, when severe issues were plaguing the firm.  In the interim, six senior partners, who started after all of them, quit in October 2019, months before any of them. 

Furthermore, around 20 associates also left before February.  

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