Dewey & LeBoeuf was once a prestigious legal powerhouse headquartered in New York City. The firm was renowned for its corporate, insurance, litigation, tax and restructuring practices. When it collapsed, it employed over 1,000 lawyers in 26 offices around the world.
Prior to its demise, the firm ensnared its partners in a giant Ponzi scheme, according to Henry Bunsow, a former partner with the firm.
Bunsow has accused former Dewey Chairman Steven Davis and other members of top management of misrepresenting the firm’s financial condition in an effort to recruit partners from other firms. He alleges that senior management wooed new partners using a Ponzi-like scheme that portrayed Dewey as fiscally stronger than it was in order to keep the firm afloat and enrich a select few. Bunsow has filed a lawsuit contending that Davis and other firm partners who were accessories to the conspiracy engaged in fraudulent acts and committed “grand theft, grand larceny, false pretences and embezzlement.”
In his complaint, Bunsow states that Dewey’s management lured him with a promise of $5 million a year in guaranteed compensation. But Davis and others “knew they would be unable to keep that promised guarantee in view of the huge debt of guaranteed income then owed to prior partners,” he maintains.
According to Bunsow, the firm required partners to deposit 36% of their estimated annual take into the firm’s account and then conspired to scam partners out of these capital investments and keep the money for themselves. Bunsow claims he suffered $7.55 million in damages as a result of losing the capital he invested in the firm plus lost compensation and benefits.
