Whistle-blower claims Cadwalader, Wittels ruined his life

By Alison Frankel
February 12, 2013

A new complaint against Cadwalader, Wickersham & Taft and Sanford Heisler by a onetime engineer for Seagate Technology who became a whistle-blower against his former employer, is the latest evidence that whistle-blowers lead difficult lives. And according to the engineer, Paul Galloway, the lawyers who were supposed to be helping him instead made him unemployable.

In 2009 Galloway reached out to a company called Convolve, which, along with the Massachusetts Institute of Technology, was suing Seagate for patent infringement and theft of trade secrets. Galloway, who was unemployed at the time (his complaint does not provide details), suggested in an email that he might have information about Seagate violating a non-disclosure agreement. Debra Steinberg of Cadwalader, who represented Convolve and MIT, followed up with Galloway. According to the engineer’s suit, Steinberg asked if he had his own lawyer. Galloway said he didn’t. He alleges that he subsequently received a call from the CEO of Convolve, who recommended that he retain Steven Wittels, then a name partner at the noted employment firm now known as Sanford Heisler.

Galloway met with Wittels, who determined that the engineer didn’t have a cause of action against Seagate. But Wittels also mentioned that Convolve’s lawyers wanted to meet Galloway, and, according to the complaint, later sent the engineer a retainer agreement that linked Wittels’s contingency fees to the Convolve litigation. Galloway alleges that, unbeknownst to him, Wittels was a personal friend of the Convolve CEO, and Convolve was secretly paying Galloway’s legal bills.

After supposedly receiving assurances from Steinberg that his identity would be kept secret, Galloway agreed to sign an affidavit attesting that Seagate misappropriated Convolve technology and destroyed evidence in the suit. As promised, Steinberg filed the affidavit under seal. But she disclosed Galloway’s name and role at Seagate in an accompanying brief that was not sealed. Moreover, reporters at The New York Times got wind of the filing and ran a story about Galloway’s allegations against Seagate.

Galloway claims that being outed as a whistle-blower destroyed his chance to find another job as an engineer in the tech industry. Days after the Times story ran, his complaint said, a job offer he’d received was rescinded, and since then, Galloway claims, potential employers in both the United States and Britain have been scared off by his reputation for blowing the whistle.

At first, Galloway claims, he didn’t blame Cadwalader for leaking his name or Wittels for putting Convolve’s interests ahead of his. He initially believed Cadwalader’s explanation that Seagate, not Convolve, had leaked his name to reporters. He continued to help Cadwalader with its case against Seagate and agreed to accept compensation for his time. Wittels, meanwhile, filed a suit against the employer who rescinded Galloway’s job offer. (The complaint doesn’t identify the employer, but the docket in federal court in Denver indicates that it was Flexstar Technology.)

Eventually, however, Galloway came to believe that Convolve and Cadwalader had used him and his affidavit as bait to attract other Seagate whistle-blowers. His relationship with Wittels deteriorated as well. Though his case against Flexstar settled, Galloway suspected that Wittels did not obtain as much as the case was worth. He ultimately concluded that Convolve’s interests, and not his, were uppermost in Wittels’ mind.

Galloway’s complaint, filed in New York State Supreme Court by Rosanne Felicello of Felicello Law, accuses Wittels and his former firm of legal malpractice and breach of fiduciary duty for failing to protect Galloway in his dealings with Convolve and Cadwalader. The suit asserts a fraudulent misrepresentation claim against Steinberg and Cadwalader, blaming them for inducing him to sign the affidavit against Seagate with false promises of confidentiality.

Wittels left his former firm last fall. In an email Tuesday, a representative of Sanford Heisler indicated that Wittels’s representation of Galloway was the reason. “No one at the firm had any knowledge of the wrongful actions allegedly committed by Mr. Wittels,” the firm said in its statement. “Within one week of learning of some of the details of Mr. Wittels’ alleged conduct, the firm terminated Mr. Wittels effective October 1, 2012.” Wittels, who is now of counsel at The Roth Law Firm, declined to comment. His lawyer, Mercedes Colwin of Gordon & Rees, sent an email statement: “The allegations brought by Mr. Galloway are without merit, and Mr. Wittels is confident that the court will dismiss all claims. Mr. Wittels is disappointed that his former client filed this misguided lawsuit. He is also disappointed that his former partners have chosen not to support him and use Mr Galloway’s baseless claims to dissolve their partnership.”

Debra Steinberg of Cadwalader referred my call to a Cadwalader spokesman, who said in an email that the firm believes Galloway’s suit is “frivolous and without merit.”

Galloway’s testimony against Seagate, meanwhile, seems to have been for nought. Last October, after tossing just about all of Convolve’s claims, U.S. District Judge George Daniels entered judgment in the case (at Convolve’s request) so the company could appeal his rulings to the Federal Circuit. Convolve filed its notice of appeal in November.

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