Legal News

Masry & Vitotoe, Firm in ?Erin Brockovich,? Files For Chapter 11

By Ashby Jones

The lawsuit that made Erin Brockovich (pictured) famous rendered a $333 million settlement. The 2000 movie, Erin Brockovich, starring Julia Roberts, grossed over $250 million worldwide.

But not all that Ms. Brockovich touched turned to gold, as it turns out. The personal injury law firm that handled the water contamination case featured in the movie, Masry & Vitotoe, earlier this month filed for bankruptcy protection.

According to Lisa Cohen, a spokeswoman for the firm, based in Westlake Village, Calif., the filing was the unfortunate result of a squabble for funds after the death of founding partner Edward Masry in 2005 (played in the movie by Albert Finney).

According to a report in the Dow Jones Daily Bankruptcy Review (link not available), a number of litigants had come forward alleging that Masry promised them assets and cash from the firm. His own estate and heirs also filed claims. All told, the law firm spent more than $3 million related to the claims and ensuing litigation.

“This drain of money and staff resources has threatened the debtor’s cash flow and focus, consequently making it more difficult to pay for ongoing litigation expenses and operating expenses,” the law firm said in court documents filed Monday.

According to the law firm, the bankruptcy filing will give it “relief from the burden this litigation has caused, in time and money, and to allow it to formulate a strategy for treatment of valid claims in an organized fashion.”

Cohen says the bankruptcy process is expected to be “speedy.”

The firm, a plaintiff-side personal injury firm, formed in 1982 when James W. Vititoe, Masry’s associate, became his partner.

In the meantime, as we’re sure you’re all dying to know, Brockovich has gone out and set up her own envrionmental-consulting firm. According to her Web site, she’s now working exclusively with Girardi & Keese on the west coast and Weitz & Luxenberg on the east coast.

Full post as published by Law Blog - WSJ.com on August 25, 2009 (boomark / email).