The King of Torts (23 page)

“At least ten,” Jonah said. “Ten for now, right now, and maybe more later.”

“We’re cranking up the advertising,” Clay said.

There was a long weary pause as Jonah and Paulette absorbed this. He had briefed them on the high points in Ketchum, but not the details. He had assured them that every case they signed up would soon pay big profits, but he had kept settlement strategies to himself. Loose tongues lose lawsuits, French had warned him, and with such an untested staff it was best to keep them in the dark.

A law firm down the street had just given pink slips to thirty-five associates. The economy was soft, billings were down, a merger was in the works; whatever the real reason the story was newsworthy in D.C. because the job market was normally bulletproof. Layoffs! In the legal profession? In D.C.?

Paulette suggested they hire some of those associates—offer them a one-year contract with no promises of any advancement. Clay volunteered to make the calls first thing the next morning. He would also locate office space and furnishings.

Jonah had the rather unusual idea of hiring a doctor for one year, someone to coordinate the tests and medical evidence. “We can get one fresh out of school for a hundred grand a year,” he said. “He wouldn’t have
much experience, but who cares? He’s not doing surgery, just paperwork.”

“Get it done,” Clay said.

Next on Jonah’s list was the matter of the Web site. The advertising had made it quite popular but they needed full-time people to respond to it. Plus it needed to be upgraded almost weekly with the developments on the class action and the latest bad news about Dyloft. “All these clients are desperate for information, Clay,” he said.

For those who didn’t use the Internet, and Paulette guessed that at least half their clients fell into that group, a Dyloft newsletter was crucial. “We need one full-time person editing and mailing the newsletter,” she said.

“Can you find someone?” Clay asked.

“I suppose so.”

“Then do it.”

She looked at Jonah, as if whatever needed to be said should come from him. Jonah tossed a legal pad on the desk and cracked his knuckles. “Clay, we’re spending huge amounts of money here,” he said. “Are you sure you know what you’re doing?”

“No, but I think so. Just trust me, okay? We’re about to make some serious money. To get there, though, we gotta spend some cash.”

“And you have the cash?” Paulette asked.

“Yep.”

__________

PACE WANTED a late drink in a bar in Georgetown, within walking distance of Clay’s town house. He was in and out of the city, very vague, as always, about where he’d been and what fire he happened to be fighting. He had lightened up the wardrobe and now preferred brown—brown pointed-toe snakeskin boots, brown suede jacket. Part of his disguise, Clay thought. Halfway through the first beer Pace got around to Dyloft, and it became evident that whatever the current project was it still had something to do with Ackerman Labs.

Clay, with the flair of a fledgling trial lawyer, gave a colorful description of his trip to French’s ranch, and the gang of thieves he’d met there, and the contentious three-hour dinner where everybody was drunk and arguing at once, and the Barry and Harry Show. He had no hesitation in giving Pace the details because Pace knew more than anyone.

“I know of Barry and Harry,” Pace said, as if they were characters in the underworld.

“They seemed to know their stuff, and for two hundred grand they should.”

Clay talked about Carlos Hernández and Wes Saulsberry and Damon Didier, his new pals on the Plaintiffs’ Steering Committee. Pace said he’d heard of them all.

Into the second beer, Pace asked, “You sold Ackerman short, right?” He glanced around, but no one was listening. It was a college bar on a slow night.

“A hundred thousand shares at forty-two fifty,” Clay said proudly.

“Ackerman closed today at twenty-three.”

“I know. I do the math every day.”

“It’s time to cover the short and buy it back. Like first thing tomorrow morning.”

“Something’s coming?”

“Yes, and while you’re at it, buy all you can at twenty-three, then hang on for the ride.”

“Where might the ride be headed?”

“It’ll double.”

Six hours later, Clay was at the office, before sunrise, trying to prepare for another day of pure frenzy. And also anxious for the markets to open. His list of things to do ran for two pages, almost all of it involving the enormous task of immediately hiring ten new lawyers and finding work space to house some of them. It looked hopeless, but he had no choice; he called a Realtor at seven-thirty and yanked him out of the shower. At eight-thirty he had a ten-minute interview with a freshly fired young lawyer named Oscar Mulrooney. The poor guy had been a star student at Yale, then highly recruited, then merged out of a job when a megafirm imploded. He’d also been married for two months and was desperate for work. Clay hired him on the spot for $75,000 a year. Mulrooney had four friends, also from Yale, who were also on the streets looking for work. Go get ’em.

At 10 A.M., Clay called his broker and covered his Ackerman short sale, making a profit of $1.9 million and some change. In the same call, he took the entire profit and bought another two hundred thousand shares at $23, using his margin and some account
credit. Online, he watched the market all morning. Nothing changed.

Oscar Mulrooney was back at noon with his friends, all as eager as Boy Scouts. Clay hired the others, then gave them the task of renting their furniture, hooking up their phones, doing everything necessary to begin their new careers as low-level mass tort lawyers. It was up to Oscar to hire five more lawyers who would have to find their own office space, etcetera.

The Yale Branch was born.

__________

AT 5 P.M. Eastern Time, Philo Products announced it would buy the outstanding common stock of Ackerman Labs for $50 a share, a merger with a price tag of $14 billion. Clay watched the drama on the big screen in his conference room, alone because everyone else was answering the damned telephones. The nonstop money channels choked on the news. CNN scrambled reporters to White Plains, New York, headquarters of Ackerman Labs, where they loitered by the front gate as if the beleaguered company might step forward and weep for the cameras.

An endless string of experts and market analysts prattled on with all sorts of groundless opinions. Dyloft was mentioned early and often. Though Ackerman Labs had been badly managed for years, there was no doubt Dyloft had succeeded in shoving it off the cliff.

Was Philo the maker of Tarvan? Pace’s client? Had
Clay been manipulated to bring about a $14 billion takeover? And most troubling, what did it all mean for the future of Ackerman Labs and Dyloft? While it was certainly exciting to calculate his new profits on the Ackerman stock, he had to ask himself if this meant the end of the Dyloft dream.

But the truth was that there was no way to know. He was a small player in a huge deal between two mammoth corporations. Ackerman Labs had assets, he reassured himself. And the company made a very bad product that harmed many. Justice would prevail.

Patton French called from his airplane, somewhere between Florida and Texas, and asked Clay to sit tight for an hour or so. The Plaintiffs’ Steering Committee needed an emergency conference call. His secretary was putting one together.

French was back in an hour, on the ground in Beaumont, where he would meet tomorrow with lawyers who had some cholesterol drug cases that they needed his help with, cases worth tons of money, but, anyway, he couldn’t find the rest of their steering committee. He’d already talked with Barry and Harry in New York and they were not worried about the Philo takeover. “Ackerman owns twelve million shares of its own stock, now worth at least fifty bucks a share but maybe more before the dust settles. The company just picked up six hundred million in equity alone. Plus, the government has to approve the merger, and they typically want the litigation cleaned up before saying yes. Also, Philo is
notorious for avoiding courtrooms. They settle fast and quiet.”

Sounds like Tarvan, Clay thought.

“Overall, it’s good news,” French said, with a fax buzzing in the background. Clay could see him pacing up and down in his Gulfstream as it waited on the ramp in Beaumont. “I’ll keep you posted.” And he was gone.

   CHAPTER 22   

Rex Crittle wanted to scold, to be reassured, to lecture, to educate, but his client sitting across the desk seemed completely unshaken by the figures.

“Your firm is six months old,” Crittle said, peering over his reading glasses with a pile of reports in front of him. The evidence! He had the proof that the boutique firm of the Law Offices of J. Clay Carter II was in fact being run by idiots. “Your overhead began at an impressive seventy-five thousand a month—three lawyers, one paralegal, a secretary, serious rent, nice digs. Now it’s a half a million bucks a month, and growing every day.”

“You gotta spend it to make it,” Clay said, sipping coffee and enjoying his accountant’s discomfort. That was the sign of a good bean counter—one who lost more sleep over the expenses than the client himself.

“But you’re not making it,” Crittle said cautiously. “No revenue in the past three months.”

“It’s been a good year.”

“Oh yes. Fifteen million in fees makes for a splendid year. Problem is, it’s evaporating. You spent fourteen thousand bucks last month chartering jets.”

“Now that you mention it, I’m thinking about buying one. I’ll need you to crunch the numbers.”

“I’m crunching them right now. You can’t justify one.”

“That’s not the issue. The issue is whether or not I can afford one.”

“No, you cannot afford one.”

“Hang on, Rex. Relief is in sight.”

“I assume you’re talking about the Dyloft cases? Four million dollars for advertising. Three thousand a month for a Dyloft Web site. Now three thousand a month for the Dyloft newsletter. All those paralegals out in Manassas. All these new lawyers.”

“I think the question will be, should I lease one for five years or just buy it outright?”

“What?”

“The Gulfstream.”

“What’s a Gulfstream?”

“The finest private jet in the world.”

“What are you going to do with a Gulfstream?”

“Fly.”

“Why, exactly, do you think you need one?”

“It’s the preferred jet of all the big mass tort lawyers.”

“Oh, that makes sense.”

“I thought you’d come around.”

“Any idea how much one might cost?”

“Forty, forty-five million.”

“I hate to break the news, Clay, but you don’t have forty million.”

“You’re right. I think I’ll just lease one.”

Crittle removed his reading glasses and massaged his long, skinny nose, as if a severe headache was developing there. “Look, Clay, I’m just your accountant. But I’m not sure if there’s anyone else who is telling you to slow down. Take it easy, pal. You’ve made a fortune, enjoy it. You don’t need a big firm with so many lawyers. You don’t need jets. What’s next? A yacht?”

“Yes.”

“You’re serious?”

“Yes.”

“I thought you hated boats.”

“I do. It’s for my father. Can I depreciate it?”

“No.”

“Bet I can.”

“How?”

“I’ll charter it when I’m not using it.”

When Crittle was finished with his nose, he replaced his glasses and said, “It’s your money, pal.”

__________

THEY MET in New York City, on neutral ground, in the dingy ballroom of an old hotel near Central Park, the last place anyone would expect such an important gathering to take place. On one side of the table sat the Dyloft Plaintiffs’ Steering Committee, five of them,
including young Clay Carter, who felt quite out of place, and behind them were all manner of assistants and associates and gofers employed by Mr. Patton French. Across the table was the Ackerman team, headed by Cal Wicks, a distinguished veteran who was flanked by an equal number of supporters.

One week earlier, the government had approved the merger with Philo Products, at $53 a share, which for Clay meant another profit, somewhere around $6 million. He’d buried half of it off-shore, never to be touched. So the venerable company founded by the Ackerman brothers a century earlier was about to be consumed by Philo, a company with barely half its annual revenues but a lot less debt and a much brighter management.

As Clay took his seat and spread his files and tried to convince himself that, yes, dammit, he did belong there, he thought he noticed some harsh frowns from the other side. Finally, the folks at Ackerman Labs were getting to see in person this young upstart from D.C. who’d started their Dyloft nightmare.

Patton French may have had plenty of backup, but he needed none. He took charge of the first session and soon everyone else shut up, with the exception of Wicks, who spoke only when necessary. They spent the morning nailing down the number of cases out there. The Biloxi class had 36,700 plaintiffs. A renegade group of lawyers in Georgia had 5,200 and were threatening an end run with another class action. French felt confident he could dissuade them. Other lawyers had opted out of the class and were planning solo trials in
their backyards, but again, French wasn’t worried about them. They did not have the crucial documents, nor were they likely to get them.

Numbers poured forth, and Clay was soon bored with it all. The only number that mattered to him was 5,380—his Dyloft share. He still had more than any single lawyer, though French himself had closed the gap brilliantly and had just over 5,000.

After three hours of nonstop statistics, they agreed on a one-hour lunch. The plaintiffs’ committee went upstairs to a suite, where they ate sandwiches and drank only water. French was soon on the phone, talking and yelling at the same time. Wes Saulsberry wanted some fresh air, and invited Clay for a quick walk around the block. They strolled up Fifth Avenue, across from the park. It was mid-November, the air chilly and light, the leaves blowing across the street. A great time to be in the city.

“I love to come here and I love to leave,” Saulsberry said. “Right now it’s eighty-five in New Orleans, humidity still at ninety.”