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March 28, 2015
UMV: 82,794
Corporate Chair, Partner Resign From Duane Morris
Christine Simmons, New York Law Journal
The chair of Duane Morris' corporate practice, George Nemphos, and corporate partner Jay G. Cohen have
resigned from the partnership, effective Thursday, according to a firm spokesman.
Their resignation comes after they and Duane Morris were sued in a legal malpractice lawsuit, alleging Cohen
and Nemphos directed a client to stop paying legal fees to Duane Morris and instead make monthly payments
to an LLC the attorneys owned.
Duane Morris has retained Zuckerman Spaeder partner William Murphy, a prominent Baltimore attorney who
focuses on legal ethics, criminal defense and investigations, to represent the firm in the malpractice
complaint.
Murphy confirmed his representation of Duane Morris but declined further comment. The firm's general
counsel, Michael Silverman, did not return calls Friday.
It's not clear who is representing Nemphos and Cohen, neither of whom could be reached Friday.
Angela Singleton, who founded shoe company Pique, brought the malpractice suit, Singleton v. Duane Morris,
24C15001044, on March 3 in Baltimore City Circuit Court against Duane Morris and Cohen and Nemphos. She
claims the partners' advice led her to lose control of the company, which filed Chapter 7 bankruptcy papers
last November in the Southern District of New York.
The lawsuit also accuses the firm and the partners of engaging in multiple conflicts of interest, contending the
partners simultaneously advised her, Pique and investors in the shoe company.
According to the complaint, Singleton and the partners reached an agreement in March 2010 in which Cohen
and Nemphos would have a monthly retainer of up to $6,500. Singleton alleges Cohen and Nemphos advised
her to stop paying Duane Morris and instead pay fees to a Maryland entity known as Smeyne Ross LLC, which
is owned by Cohen and Nemphos. The lawsuit said Smeyne and Ross are the maiden names of the partners'
spouses.
In an interview Friday, Singleton's attorney, Andrew Hall, managing partner of Hall, Lamb and Hall in Miami,
said he doubts Duane Morris knew about the LLC before the lawsuit was filed. "I wouldn't be surprised if
the suit was part of the circumstances leading to their resignation," Hall told the Law Journal.
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Nemphos, a former DLA Piper partner, was also managing partner of Duane Morris's Baltimore office and
member of the national governing partners board.
According to his Duane Morris profile, he handled mergers and acquisitions, securities, compliance and
general corporate matters. His clients included private equity and venture capital groups and hedge funds.
Duane Morris said Chicago partner Brian Kerwin will take over as chair of its corporate practice. Kerwin has
served as vice chair of corporate and was among the founders of the firm's Chicago office in 1999.
Partner Robert Hopkins now leads the Baltimore office.
A firm press release announcing the leadership changes does not reference Nemphos, who became chair of
the corporate group in 2010, nor Cohen.
Firm spokesman Joshua Peck declined to comment on the circumstances of the resignations.
Malpractice Allegations
Singleton sued Duane Morris for negligence and breach of fiduciary duty and estimates total damages to be
more than $10 million.
Her suit claims Pique began making the monthly payments directly to Smeyne Ross' P.O. Box in May 2010.
"[Singleton] is unaware if Duane Morris had knowledge of or approved these payments," the suit said. "At the
time Cohen and Nemphos directed her to make these payments directly to Smeyne Ross LLC, Singleton
assumed it was with knowledge and permission of Duane Morris."
Maryland government records describe Nemphos as the agent for Smeyne Ross LLC, which he formed in 2008.
Singleton claims that Cohen led her to believe that Smeyne Ross LLC was representing her and Pique "because
Duane Morris was not interested in the representation going forward," due to the small monthly fees.
To conceal the payments, the suit claims, Cohen and Nemphos did not provide Singleton or Pique with a
written retainer agreement and Smeyne Ross never issued any bills.
In March 2011, Cohen and Nemphos advised Singleton to split the monthly retainer fee between Duane
Morris and Smeyne Ross, she said.
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Singleton also alleges that Cohen and Nemphos through Smeyne Ross LLC obtained a 3 percent equity interest
in Pique though for no consideration and handled this transaction contrary to attorney ethics rules.
According to the complaint, Singleton developed two inventions for high heels to relieve pressure in the foot
and make the shoes more comfortable. She secured rights for three patents.
She met Cohen in December 2008 as part of a free mentoring session in a business incubator program, her suit
said. The following month, Pique retained Duane Morris under a written retainer agreement and the
engagement was then expanded to include Singleton herself.
Cohen advised Singleton at that time that she could hold off on paying the firm's legal bills, which would
accrue until she had financing for the company.
In 2009, Cohen and Nemphos were searching for funding of Singleton's business and contacted Jaemin Park, a
former Akin Gump Strauss Hauer & Feld partner who was a client of Cohen and Duane Morris, according to
the suit.
Park, who had stepped back from practicing law and was focusing on business ventures, arranged for
$900,000 to be invested from Park herself and other investors. With Cohen's participation, the suit said, Park
solicited another Duane Morris client to invest in Pique, Zeid Masri, who leads equity company Silverhaze
Partners.
Although Cohen disclosed to Singleton that he had a long relationship with Park and that Masri and Silverhaze
were clients of Duane Morris, he failed to fully disclose the conflicts of interest, the suit said.
It claims Cohen failed to advise Singleton to consider retaining her own counsel.
Cohen encouraged Singleton to accept Park and Masri as partners, the suit said.
Cohen formed a corporation know as Pique Founders Co. LLC, a Maryland entity that would acquire ownership
of Singleton's intellectual property rights. Singleton, Park and Masri would each own one third of this entity.
During the negotiations over the funding transaction, Singleton claims she continually advised Cohen that it
was critical she have approval of any major decisions about Pique.
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However, the lawsuit alleges that in April 2010 Cohen sent her a draft operating agreement containing a
revision that upon repayment or maturity of convertible notes, the prohibition against major actions without
unanimous consent of the board would end, and Singleton would lose her right to control major actions of the
company.
The suit claims Cohen failed to advise Singleton of this change and Singleton claims she didn't see it. The
agreement was executed in April 2010.
Singleton's ownership interest was reduced to 41.14 percent and Park and Masri had a combined majority of
Pique's membership interest.
In 2012, disagreement arose among the three, but the suit claims Cohen failed to protect Singleton's rights
and intervene.
The outstanding notes had matured in April 2012, meaning the majority vote governed the company, the suit
said.
Park and Masri filed a lawsuit against Singleton in Maryland federal court, Park v. Singleton, 12-cv-01438,
requiring Singleton to return funds she had transferred back to an account controlled by the majority of the
board. The court ruled in favor of Park and Masri.
Singleton's suit claims that, as a result of Cohen's revision to the operating agreement, she lost her consent
rights and control over Pique. She was terminated as an officer and frozen out of the business from June 2012
forward.
She says without her ability to control decisions, Pique spiraled downward, leading to bankruptcy in
November.