Counsel for Pillsbury Winthrop Shaw Pittman on Wednesday urged the U.S. Court of Appeals for the Second Circuit to overturn a lower court ruling that the firm must return millions of dollars in a retainer paid before the client’s assets were frozen.
Pillsbury partner Anne Voight argued the more than $3.6 million became the firm’s property when the client, Adam Rogas, retained Pillsbury and transferred the funds just days before he was charged with securities fraud. Therefore, a freeze order targeting Rogas’ assets could not apply to the retainer, she said.
Meanwhile, the U.S. Securities and Exchange Commission says that Rogas retained an interest in the retainer, as it covered work to be done on his behalf, and that therefore the money is clearly covered in the language of the retainer.
“The funds were being used for Mr. Rogas’ benefit,” SEC Attorney Paul Alvarez said, adding the ruling included language covering a “person or entity holding any funds for the benefit of Mr. Rogas.”
“Those funds were being used to his legal defense and therefore are conferring a benefit,” the lawyer said.
Source: Pillsbury Fights to Keep Nearly $4 Million in Client Money Sought by SEC