Kazuo Okada made billions in gambling, as the tech geek who figured out how to make slot machines register a “near miss” to prompt the weak willing to shovel another quarter into the maw of avarice. Before it was all said and done, Okada’s slot machine company owned roughly 20 percent of Wynn Resorts and had its own independent casino in Manila. But his latest gamble — not paying his $50 million legal fees — didn’t pay off.
Bartlit Beck negotiated a fee deal with Okada back in 2017 when he locked horns with Wynn over the value of his stake in the resort empire. Wynn ousted Okada, claiming the Japanese businessman “likely violated the Foreign Corrupt Practices Act” and gave him a $1.94 billion 10-year note for his troubles. But Okada’s stake was worth $2.7 billion now so he sought out the power litigation firm to get him his money. Which they — specifically Phil Beck, Chris Lind, Hamilton Hill, and Brian Swanson — did to the tune of a settlement for $2.632 billion in 2018.
With a couple of billion coming in, you’d think Okada would have no problem paying his attorneys a relatively piddling $50 million, but you’d be wrong! The date for payment came and went with Bartlit Beck seeing nothing. Bartlit Beck decided to call Okada’s bluff.
Chris Lind from the underlying case, along with Bartlit Beck’s Adam Hoeflich, and Sean Berkowitz from Latham & Watkins, all went to arbitration — a condition of the fee agreement — to get the firm paid. Along the way, Okada called the fee “unconscionable,” a ballsy for a fee amounting to less than 2 percent of the recovery. I guess if your billion-dollar fortune is built on quarters it can skew your perspective. The arbitrators, on the other hand, suffered no myopia and awarded Bartlit Beck its full fee plus interest. It didn’t hurt that Okada refused to participate in the hearing, pulling out at the last minute.
Unfortunately, winning an award is only the first step. The firm filed the arbitration award with the courts to get it enforced. Hopefully, Okada has assets easier to tag than some clients. Personally, I once had to order Texas Rangers to seize a Boeing 707 to get someone to pay up. Arranging for hangar space isn’t exactly a skill they teach in law school.
Why do clients think it’s acceptable to stiff attorneys? The greedy lawyer stereotype makes for some good jokes, but while tragic abuses can target the most vulnerable, among the elite ranks of the profession the fees are pretty reasonable. Paying $50 million to recover over $800 million extra is hardly unconscionable. Trafficking in “money-grubbing lawyer” tropes while sitting on billions is much more unconscionable.
And it’s also dumb. If you’re betting on powerhouse litigators to walk away from their fees without a fight, then you’re making the losing bet.
Joe Patrice is a senior editor at Above the Law and co-host of Thinking Like A Lawyer. Feel free to email any tips, questions, or comments. Follow him on Twitter if you’re interested in law, politics, and a healthy dose of college sports news. Joe also serves as a Managing Director at RPN Executive Search.