West Virginia Record

Sunday, February 23, 2020

Jim Justice sued for failing to pay $3 million in legal fees

By Kyla Asbury | May 26, 2016


CHARLESTON – Earlier this month, a law firm won an arbitration award of more than $3 million against Jim Justice for failure to pay legal fees.

The Democratic gubernatorial nominee has failed to pay the court order and is now being sued by the law firm, Sullivan & Cromwell, for failure to pay.

Sullivan & Cromwell filed the complaint in New York Supreme Court on Tuesday and, according to the complaint, the firm obtained an arbitration award of $3.25 million earlier this month against Justice, his two adult children and his business entity James C. Justice Companies Inc. for failing to pay legal fees.

The legal fees stem from the firm’s representation of the defendants, beginning in 2014, in a dispute around the price of coal reserves in West Virginia that James C. Justice II Companies sold to the Russian company, Mechel Mining OAO, according to the complaint.

The complaint states that Justice agreed to pay the firm a $1 million retainer upfront, and to pay 15 percent of any recovery, minus $1 million.

Under the settlement, his Delaware business entity, James C. Justice Companies, Inc. received the right to repurchase the coal properties from Mechel under a cash and stock transaction.

With the timing and value of the settlement in dispute, and Sullivan & Cromwell’s contingency fee hanging in the balance, the firm took the matter to arbitration over five days in January in New York.

On May 12, a three-person AAA arbitration panel awarded Sullivan & Cromwell $3.25 million, which included $2.59 million in legal fees, $254,000 in pre-award interest, $320,000 in costs, plus $86,000 in administrative fees, according to the complaint.

“Our firm has good faith that the courts of the state of New York will do the right thing,” said David Tulchin, special counsel at Sullivan & Cromwell.

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