Opinion ID: 1852412
Heading Depth: 1
Heading Rank: 3

Heading: Denver Golf Litigation

Text: In early February 1996, Consortium contacted James Nicholson, its billing partner at Faegre, and asked whether Faegre would defend it in a lawsuit filed by Denver Golf, Ltd. (Denver Golf), in the United States District Court for the District of Colorado. Nicholson passed the matter to his partners in Faegre's Denver office. Denver Golf's complaint alleged that Consortium breached a construction loan agreement. The complaint did not allege fraud, nor did it allege that Consortium's refusal was part of a larger pattern of refusals to fund loans. Faegre's conflict check revealed no conflicts. The firm made its first appearance in federal district court on Consortium's behalf on February 12, 1996. In early March 1996, Consortium filed a motion to dismiss or, in the alternative, for summary judgment, arguing that execution of the construction loan agreement was merely a paper closing that was done in escrow and was subject to the approval of Consortium's Board of Directors. Because the Board did not approve the loan, Consortium argued the loan agreement never took effect. On June 18, 1996, a United States Magistrate Judge recommended that Consortium's motion be denied. Although Denver Golf's complaint did not allege fraud, Denver Golf's attorney, Paul Grant, told Faegre attorneys he thought Consortium engaged in fraud. In an affidavit submitted to the trial court in the instant case, Grant described the statements he made while working on the Denver Golf litigation: Shortly after the time Faegre    first appeared in the case and later in written discovery requests, I asked the Faegre    attorneys to provide documentation demonstrating that Consortium had funded the projects identified in their promotional literature. I told [a Faegre attorney] that I thought Consortium may have engaged in fraud. I discussed with Faegre    attorneys, at a hearing before a United States Magistrate, that I did expect Faegre    to produce documents to show that Consortium had actually made the loans described in their literature. Faegre    attorneys replied that they were not sure they could comply, since all Consortium loans were covered by confidentiality agreements. Cathy Lemon, a Faegre attorney who worked on the Denver Golf litigation, stated that Grant requested documentation of Consortium's other deals because he thought that Consortium didn't have enough money to fund all of the deals [it] had in the pipeline.