$10 Million Lawyer

$10 Million Lawyer

By David R. Corder

Associate Editor

By most accounts, Barry Cohen is one heck of a lawyer. Some might even say he's Florida's finest. But is the Tampa attorney worth $10 million?

Marc Zboch apparently thought so almost four years ago when he faced a federal criminal indictment. Only now the Ormond Beach businessman says he overpaid.

At issue is the $5.5 million Zboch still owes on his legal bill to Tampa's Cohen Jayson & Foster PA. The bill is due this month.

Zboch has adopted a somewhat unusual legal strategy in a bid to lessen his debt to Cohen's firm. He accuses the firm of violating the state's Unfair and Deceptive Trade Practices Act, in addition to breach of contract and fraud in the inducement.

The use of the trade practice act may be a novel legal strategy, say some legal experts. It's not often used against lawyers, though a recent appellate decision in the 1st District Court of Appeal says the act does not exclude attorneys from its application.

Zboch, a one-time marketing executive at Daytona Beach-based National Direct Corp., hired Tampa attorney Michael Addison to file a lawsuit May 12 against Cohen's firm in the Hillsborough County courts. Neither Addison nor his client would comment about the accusations.

But Cohen has much to say.

"The truth is an indictment was eminent," Cohen says about his ex-client. "The indictment was already drawn and approved. He knew when he came over here it was imminent."

Rather than pursue a purely adversarial strategy, Cohen says he convinced Zboch to present his story to officials from the Internal Revenue Service, Federal Bureau of Investigation and the U.S. Postal Service in front of the chief of the criminal division for the U.S. attorney's office in the Middle District of Florida.

"I engaged in a course of conduct which frankly was damn good lawyering," Cohen says. "We stopped the indictment by getting a lot of information to the prosecutors and letting them talk to him without immunity. I was damned confident (about the strategy). It permitted him to stay out of prison for about 30 years and live his life with his family."

When he retained Cohen, Zboch already had two reputable national law firms working for him - Skadden Arps Slate Meagher & Flom LLP and Zuckerman Spaeder LLP, court records state.

Someone at one of those firms suggested that Zboch retain Tampa trial consultant Harvey Moore to assist with trial preparation work. Zboch claims Moore had no confidence in either of those firms to defend against a criminal indictment. He recommended Zboch talk to Barry Cohen.

In the years prior to retaining Cohen, Zboch knew federal agents were interested in the operations at National Direct and its affiliates. Those agents took a particular interest in the involvement of Brad Richdale, Michael Cimino and Zboch, acknowledges FBI spokesman Jeff Westcott, a special agent in the agency's Jacksonville office. In March 1999, FBI agents raided several locations related to National Direct and Richdale, Cimino and Zboch.

"The investigation was closed in late 2003 without any charges being filed," says Westcott, who would not discuss details of the accusations against the three men or their affiliated corporations.

However, a spokesperson for Florida Attorney General Charlie Crist says state agents investigated complaints about National Direct's Internet moneymaking promotions. The state agency, too, took particular interest in the involvement of Richdale, Cimino and Zboch and their affiliated companies. Only the agency ultimately deferred all prosecution to federal authorities.

It was during the mid- to late-1990s, when Richdale earned a fortune off a book titled, "Secrets to Money Making Now." He frequently appeared in cable TV commercials with Fran Tarkenton, the retired Minnesota Vikings quarterback. Richdale was sometimes referred to as the "infomercial king."

The federal and state complaints focused on an aggressive telemarketing campaign aimed at those who purchased Richdale's book. National Direct representatives would call book purchasers and tout premium-marketing services such as in-depth courses and studies on how to earn a fortune.

During this period of time, Richdale, Cimino and Zboch started several ventures that focused on direct marketing and Internet marketing opportunities for investors. Besides National Direct Corp., those ventures included Marketers World International Inc., Brad Richdale Direct Inc., Health Tec Research Inc. and VR Mall Inc.

In 1998, those companies merged with the affiliated ZZap.net Inc., a Daytona Beach-based Internet marketing firm.

In a press release distributed then, Marketers World, Brad Richdale Direct, Health Tec and VR Mall claimed annual sales of nearly $70 million.

Not long after, ZZap.net merged with High Speed Net Solutions Inc., a publicly traded shell company. Then the deals with Marketers World, Brad Richdale Direct, Health Tec and VR Mall collapsed, though High Speed Net's publicly available financials do not explain why.

Since then, High Speed Net evolved into Summus Inc. (USA), a publicly traded North Carolina wireless services company. The company no longer claims any business relationship with Richdale, Cimino or Zboch, says Don Locke, Summus' CFO and general counsel.

In July 2001, creditors forced National Direct into bankruptcy court under Chapter 7 of the U.S. Bankruptcy Code. Earlier this year, the bankruptcy trustee filed a final accounting - a balance on hand of only $31,664.

In October 2001, Zboch signed the legal services engagement letter with Cohen's firm. He agreed to pay a $4.5 million initial fee. Another $5.5 million would be due within two years of a resolution of criminal proceedings against him. There was a caveat, however.

In return, Zboch demanded that Cohen represent him as lead trial counsel. If Cohen became ill and could not represent him, Zboch wanted the option of continuing with Cohen Jayson partner Todd Foster or receiving a refund of $1 million.

Only Zboch claims Cohen failed to abide by the terms in the engagement letter.

"Barry Cohen never intended to and did not function as lead counsel in the handling of the case because of his previous commitments to other clients," the complaint states. "(He) did not devote a substantial portion of his efforts to the case for two months after the execution of the agreement. (He) did not transfer his other case responsibilities in order to have the time to devote to the case."

In Cohen's view, the complaint is a ruse to avoid paying a legal debt that has come due. He lays a rightful claim to every dime of the money Zboch paid in advance and what he still owes.

To illustrate his claim, Cohen cites other lawyers' criminal defense work for high profile white-collar crime defendants such as Jeffrey Skilling, Enron Corp.'s ex-CEO, and Richard Scrushy, HealthSouth Corp.'s ex-CEO. He says Skilling paid around $23 million to defend against federal corruption charges. He says Scrushy's legal bill ranges somewhere between $20 million to $40 million.

"This was a white-collar fraud case," Cohen says about the federal criminal investigation into Zboch's work at National Direct.

From a practical perspective, Cohen says his defense against Zboch's complaint will focus on the stipulations written into Page 3 of the legal services engagement letter. It clearly cites the American Bar Association's Code of Professional Responsibility as the foundation for those stipulations.

The code prohibits excessive fees and offers certain guides to determine if a fee is excessive. "A fee is clearly excessive when, after a review of the facts, a lawyer of ordinary prudence would be left with a definite and firm conviction that the fee is in excess of a reasonable fee."

The code also allows attorneys to factor in anticipated results when computing fees, Cohen says. So he thinks it's important to understand the federal authorities never indicted Zboch and then closed the case.

"It was an arms-length transaction, and he did what was in his best interests," Cohen says. "He knew what he was getting into."

Cohen's clients

Over the years, Barry Cohen has litigated some of the highest profile cases in the Tampa Bay area. Here's a few:

• Steve and Marlene Aisenberg. Cohen successfully represented the couple against Justice Department accusations they were responsible for the disappearance of their infant daughter, Sabrina. He then persuaded a U.S. District judge to grant the couple more than $2.7 million in attorneys' fees for bad faith prosecution. The 11th Circuit U.S. Court of Appeals later reduced the amount by almost $1.4 million.

• Jennifer Porter. Cohen represents the 29-year-old former dance teacher on felony charges of leaving the scene of an accident that left two children dead. On his advice, she has rejected a plea deal that would send her to prison for three years.

• Charles Gable Yerrid. Successful civil trial attorney Steve Yerrid retained Cohen to defend his son against charges in the traffic death of Nancy Christine White Bradley. The son was fined $350 and ordered to complete community service.

• E.J. Salcines. The former Hillsborough County state attorney, now a 2nd District Court of Appeal judge, retained Cohen to defend against federal allegations of public corruption. Charges were never filed.

• Donald Segretti. Cohen defended the California lawyer against charges he committed political sabotage on behalf of President Richard Nixon's Committee to Re-Elect the President.

• Arden Mays Merckle. The retired Hillsborough County judge retained Cohen to represent him against criminal charges he violated a man's civil rights by illegally jailing him.