COURT OF CHANCERY

OF THE 

STATE OF DELAWARE

 JOHN W. NOBLE 417 SOUTH STATE STREET

VICE CHANCELLOR DOVER, DELAWARE 19901

 TELEPHONE: (302) 739-4397

 FACSIMILE: (302) 739-6179

February 26, 2016

Evan O. Williford, Esquire David S. Eagle, Esquire

The Williford Firm LLC Klehr Harrison Harvey Branzburg LLP 

901 North Market Street, Suite 800 919 North Market Street, Suite 100 

Wilmington, DE 19801 Wilmington, DE 19801

Re: Sutherland v. Sutherland

C.A. No. 2399-VCN

Date Submitted: November 9, 2015

Dear Counsel:

Plaintiff Martha S. Sutherland (“Sutherland”) sued two of her brothers 

regarding their handling of the family businesses. That effort, which spanned a 

decade, had some minor success, but otherwise would be perceived as a failure. 

Because of that minor success, the Court awarded Sutherland $275,000 for her 

attorneys’ fees and expenses.1 

 

1

Sutherland v. Sutherland, 2014 WL 3906500, at *5 (Del. Ch. July 31, 2014).

EFiled: Feb 26 2016 02:48PM EST 

Transaction ID 58636615

Case No. 2399-VCN
Sutherland v. Sutherland

C.A. No. 2399-VCN

February 26, 2016

Page 2

When her efforts began in 2004, she was represented by Intervenor Katten 

Muchin Rosenman LLP (“Katten”). One of her lawyers there, Stewart Kusper, 

Esq. (“Kusper”), left the firm in the spring of 2011 and continued to represent her. 

In April 2011, Katten transferred Sutherland’s files to Kusper’s new firm.2 From 

then on, Katten performed no (or substantially no) services for Sutherland. All of 

the benefits achieved by Sutherland were accomplished while Katten was 

representing her. 

Katten had billed Sutherland regularly for its services. She paid 

approximately $2.7 million out of approximately $3.5 million in total billings from 

Katten, and still owes $766,166.75.

3

 Katten intervened in this action to assert an 

attorney’s charging lien against the fees awarded by the Court. Sutherland claims 

entitlement to those fees.4

 

2 Aff. of Bonita L. Stone in Supp. of Intervenor Katten Muchin Rosenman LLP’s 

Mot. for Summ. J. (“Stone Aff.”) ¶ 9; id. Ex. F.

3

Stone Aff. ¶¶ 4–6; id. Ex. D. These fees are based on Katten’s services regarding 

Sutherland’s litigation in Delaware. They do not include work done on companion 

litigation elsewhere.

4 Neither Kusper nor his new firm(s) has joined in this conflict. Thus, there is no 

debate about priority of (or allocation between) competing charging liens.
Sutherland v. Sutherland

C.A. No. 2399-VCN

February 26, 2016

Page 3

Katten has moved for summary judgment on its right to an attorney’s 

charging lien which would cover all of the Court’s fee award.5

In March 2004, Sutherland initiated an effort under 8 Del. C. § 220 to 

inspect the books and records of the family businesses. At that time, Sutherland 

and Katten may have entered into a written fee agreement that cannot now be 

found.6 Whether there was a written agreement, however, is not determinative 

because of the duration of the Katten-Sutherland attorney-client relationship, the 

regular monthly billings, and the significant sums that Sutherland paid over several

years to Katten.7 

In September 2006, Sutherland filed a derivative and double-derivative 

action against her brothers on behalf of the family businesses. That litigation was 

protracted. The Special Litigation Committee process was cumbersome, but 

 

5

Intervenor Katten Muchin Rosenman LLP’s Mot. for Summ. J. on Its Verified 

Pet. for a Charging Lien. Katten has offered no other theory for attaching or 

placing a lien on the funds that are due Sutherland.

6 Katten insists that there was a written fee agreement. Sutherland denies (or at 

least cannot remember) its existence. Perhaps the passage of time or the transfer of 

files by Katten to Kusper’s new firm would explain the loss of any written 

agreement. 

7

It is, of course, desirable, appropriate, and sometimes necessary for lawyers and 

clients to memorialize in a written agreement their common understanding 

regarding the scope of representation and the fee arrangement.
Sutherland v. Sutherland

C.A. No. 2399-VCN

February 26, 2016

Page 4

Katten’s (and Sutherland’s) efforts resulted in eliminating the brothers’ 

expectations of two-year’s salary if terminated for cause and a modification 

(favorable to the family businesses) of provisions allowing the brothers to compete 

with the family businesses. These benefits were all achieved (adopted by the 

boards of the family companies) by 2007, years before Katten’s departure. In 

2010, the Court granted summary judgment against Sutherland on most of her 

claims.8 The remaining claim was tried in November 2012.9

In seeking an award of fees, Sutherland relied upon Katten’s invoices which 

detailed its services performed for her and its expenses incurred in her behalf.10 

Indeed, in making an award of fees to Sutherland, the Court relied upon Katten’s 

invoices as sponsored by Sutherland.11 

 

8

Sutherland v. Sutherland, 2010 WL 1838968 (Del. Ch. May 3, 2010).

9

Sutherland v. Sutherland, 2013 WL 2362263, at *1–4 (Del. Ch. May 30, 2013).

10 Kusper not only argued the fee application on behalf of Sutherland, but he had 

also been deeply involved in the work which Katten performed on her behalf while 

he practiced at Katten.

11 Sutherland, 2014 WL 3906500, at *1–2.
Sutherland v. Sutherland

C.A. No. 2399-VCN

February 26, 2016

Page 5

Summary judgment is appropriate if no material facts are in dispute and the 

moving party is entitled to judgment as a matter of law.12

An attorney’s charging lien is not a novel concept. An attorney’s charging 

lien is “the right of an attorney at law to recover compensation for his services 

from a fund recovered by his aid, and also the right to be protected by the court to 

the end that such recovery might be effected.”13 The theoretical basis for the lien is 

“that one should not be permitted to profit by the result of litigation without 

satisfying the demand of his attorney.”14 Delaware recognizes the attorney’s 

charging lien in both courts of law and courts of equity. Although frequently 

 

12 Ct. Ch. R. 56. Sutherland has raised no questions of material fact as to Katten’s 

contention that she owes the firm at least $275,000, the amount of the fee award. 

There may have been disagreements between Katten and Sutherland, but 

Sutherland has not offered a factual basis for concluding that she was “overbilled” 

by an amount that would reduce the amount she owes below the fee award. See

Aff. of Martha S. Sutherland in Opp’n to Intervenor Katten Muchin Rosenman 

LLP’s Mot. for Summ. J. ¶¶ 2–5.

13 Doroshow, Pasquale, Krawitz & Bhaya v. Nanticoke Mem. Hosp., Inc., 36 A.3d 

336, 340 (Del. 2012) (quoting 2 Edward Mark Thornton, A Treatise on Attorneys 

at Law § 578 (1914).

14 Id. (quoting 2 Edward Mark Thornton, A Treatise on Attorneys at Law § 580 

(1914).
Sutherland v. Sutherland

C.A. No. 2399-VCN

February 26, 2016

Page 6

referred to as equitable remedy, the use of the word equitable in describing the lien 

has come “in the broad sense to mean ‘fair’”15 

The fees and expenses for which Katten seeks a charging lien were incurred 

after 2008; that is, the fees and expenses were incurred after the derivative benefits 

for the family businesses upon which the Court’s fee award was premised had been 

achieved.16 Thus, the principal question is: may a lawyer obtain a charging lien

upon a recovery by the (former) client based on the work done by the lawyer if the 

lawyer has already been paid for the work that led to that recovery? Stated 

differently, may a lawyer secure a charging lien for work done after the benefits 

supporting a fee award (in this instance, the derivative benefits accruing to the 

family businesses) were achieved if the lawyer’s work which achieved the benefits

has been paid for?17

 

15 Id. at 341 (quoting Polin v. Delmarva Poultry Corp., 188 A.2d 364, 366 (Del. 

Super. 1963)).

16 Sutherland paid Katten’s fees until after the derivative benefits had been 

obtained.

17 The scope of the dispute between Katten and Sutherland is not as expansive as it 

once might have been. For example, Sutherland does not contend that the 

arrangement with Katten was in her individual (and not as trustee) capacity; that 

the fee agreement might have had venue or arbitration provisions; or that Katten 
Sutherland v. Sutherland

C.A. No. 2399-VCN

February 26, 2016

Page 7

The purpose of a charging lien is to make sure that the client does not avoid 

paying her lawyer for the benefits she obtained.18 Katten has been paid in full for 

its invoices based on its work that provided both benefits to the family companies 

and the basis for the Court’s fee award.19 In essence, Katten seeks imposition of a 

charging lien for work which caused no benefit and has no connection to the 

recovery, other than having occurred in the same litigation. The Court in 

Doroshow recognized that because a law firm represented a client on a contingent 

fee basis, “the law firm had not been compensated before its work produced the 

funds.”20 Seeking a charging lien for work which produced no benefit when the 

law firm has already been paid for the work which produced the benefit (whether 

 

had improperly allocated her fee payments between litigation in Delaware and 

elsewhere.

18 “[T]he rationale for an attorney’s charging lien [is] that attorneys have a right to 

compensation for funds recovered by their efforts.” Doroshow, 36 A.3d at 343.

19 Frequently, allocation will be difficult because the recovery typically comes at 

the end of the litigation and linking any benefit to any specific effort would be 

imprecise. 

20 Doroshow, 36 A.3d at 342.
Sutherland v. Sutherland

C.A. No. 2399-VCN

February 26, 2016

Page 8

the benefit for the family corporation or the corresponding fee award) is 

inconsistent with the theoretical underpinnings of the attorney’s charging lien.21

Accordingly, Katten’s motion for summary judgment is denied.22

IT IS SO ORDERED.

Very truly yours,

/s/ John W. Noble

JWN/cap

cc: Robert S. Saunders, Esquire

S. Mark Hurd, Esquire

Register in Chancery-K

 

21 In addition, because Sutherland paid Katten for the services which generated the 

benefit, the equitable or “fair” approach would be to allow her reimbursement for 

those fees which she paid.

 Katten expresses concern that this result could lead to gamesmanship: of clients 

who would selectively pay invoices that are connected to legal efforts that were in 

some sense successful. Perhaps evidence of that sort would change the Court’s 

analysis, grounded as it is in notions of equity and fairness, but no such evidence 

has been offered in this action.

22 This is a dispute about payment of Katten’s fees from a specific fund. It does 

not impact Katten’s right to pursue Sutherland personally for whatever she may 

owe it.