Chinese DrywallRoger Chadderdon's firm, Cataphora, won a breach-of-contract case against a bunch of lawyers who had hired the firm to provide "litigation support".

The lawyers served on the Plaintiffs' Steering Committee in a massive case that the Judicial Panel on Multi-district Litigation sited in New Orleans. See In re Chinese-Manufactured Drywall Products Liabiity Litig., No. MDL-2047 (E.D. La.).

They defended themselves on the ground, likely among others, that Cataphora "had surreptitiously included [in its contract with them] a provision calling for the company to receive a 'success fee.'" Herman v. Cataphora, Inc., No. 12-30966, slip op. at 2 5th Cir. Sept. 17, 2013).

Let us pause now to think about what a success fee means in the context of litigation support as well as how one might insert a success fee clause into a contract surreptitiously with a bunch of lawyers.


Chadderdon chose to Gloat about the win, which Cataphora obtained from a jury in the Northern District of California. But Chadderdon did so in a talk with Above the Law's Christopher Danzig (now an ATL ex-pat). And, in the course of the Gloating, Chadderdon used words like "hypocrites", "screwed", and "kicked their ass".

The bragging prompted two of the lawyers to Sue for libel. They did so in the Pelican State. Chadderdon and Cataphora moved to dismiss for want of personal jurisdiction. And they won.

The Fifth Circuit upheld the order. The panel ruled that the lawyers hadn't met the "focal point" test of Calder v. Jones, 465 U.S. 783 (1984), largely because the bad-mouthing (if any) took place in the Golden State, not the Pelican one.

The court none the less vacated the district court's order. Go west, the panel instructed, because sending the case there would serve the interest of justice under 28 U.S.C. 1406(a), partly because a transfer could avoid statute of limitations concerns. Herman, slip op. at 9.