Settlement leads to schism

Without the jury present, Carl Mallory told Judge Bob McGrath of the 342nd state District Court on Monday that as lead plaintiff attorney for most of the botulism victims he disagreed with terms hammered out with Keith last Wednesday by his partner of 14 years, Louis Sturns, and an assisting lawyer, Charles Noteboom of Hurst. Mallory & Sturns is based in Arlington.

Mallory, who had introduced himself to the jury as "just an old country lawyer," dropped any shred of homespun folksiness before McGrath, asserting that he had not signed off on the settlement as required and that his clients were unaware of how much each would receive.

Taken aback, McGrath asked all the attorneys to approach the bench, displayed a paper signed by Sturns and Keith attorney Jim Carroll, then instructed Mallory to stop protesting.

When Mallory resumed his arguments, the judge brushed them aside: "Do I need to bring the bailiff in or will you be quiet?"

Outside the courtroom, Mallory said the cash settlement -- believed to be more than $2 million -- was so inadequate that he likened it to "robbing a bunch of Girl Scouts."

The volatile schism in the Mallory & Sturns law firm was the latest twist in a complicated and often emotional case arising from the 2001 poisoning of 15 people, the country's worst botulism outbreak since 1994.

Ten people, including the mother of the youngest victim, sued Keith for reselling frozen chili that they claim had been rejected by a Dallas cafe. Also suing Keith are the manufacturer, First Original Texas Chili, and Town Talk Foods, a Fort Worth discount grocery that acknowledges that it sold the chili but says it was not told by Keith that it had been rejected. Town Talk has already paid $2.85 million to the victims. The two smaller companies claim that Keith damaged their respective businesses because of its alleged mishandling of the chili and claim that it withheld key evidence until the eve of the first scheduled trial in 2005.

Keith, among Fort Worth's oldest and most-respected companies, denies any wrongdoing. The large regional foodservice distributor replaced its trial lawyers after belatedly handing over internal memos that quoted a manager named Robby Austin as bragging about misleading federal investigators probing the mass poisoning.

Although Keith contends that no proof links it with the botulism-laced chili, the company settled with seven of the victims Wednesday and an eighth Monday without admitting any culpability. It also created its own courtroom drama by asserting that a settlement had been reached with Texas Chili.

The chili maker's attorney, John Barr of Dallas, vehemently denied any agreement and, over protests, was put on the witness stand by a Keith attorney, Jennifer Aufricht, also of Dallas.

Barr's anger flashed when Aufricht asked, "Do you have an obligation to your client?"

"That's insulting," he shot back.

At one point, McGrath asked the sparring lawyers, "Can you take the sarcasm and distaste for each other out of this?"

Barr eventually confirmed that a deal had been largely worked out but that he never saw a written agreement that was to have been faxed to his office Friday afternoon. Moreover, he had not conferred with his client, Danny Owens, the coowner, along with his wife, of the Fort Worth-based chili company. He also denied telling a Keith lawyer who was negotiating the agreement that Town Talk must be party to any deal.

Outside the courtroom, Barr said he would not agree to any settlement that kept Keith's role in the botulism case sealed. "There will be no confidentiality," he said.

Town Talk attorney R. Wayne Gordon of Dallas said that he has not been approached by the Keith side. But Kelly Puls, a Fort Worth attorney for one of the last two botulism victims in the suit, said Monday that he was negotiating with the food-service distributor. Lori Watson, a Dallas attorney for the other remaining victim, said no one from Keith's side had contacted her.

Sturns acknowledged the difficult rift with his law partner, Mallory.

"We've been through these things before and hopefully we'll work through this," said Sturns, 57, a former judge on the Texas Court of Criminal Appeals. "From my standpoint, the bottom line is that you have to follow the client's direction."

The plaintiffs, many of them members of the Jones family of Sanger, faced the uncertainty of a jury award and, possibly, a drawn-out appeals process, he said. Even if there was a jury award, it would have to be higher than the $2.85 million victims already have received from Town Talk because of a so-called settlement credit to which Keith would be entitled.

"The clients met with us several times and, frankly, Carl did not want to participate in those meetings," Sturns said. "And in those meetings, the clients made it clear to us they wanted the case settled. "As for Mallory's complaint that the clients were not told how much each would receive, Sturns said the plaintiffs weren't informed of the individual amounts when they signed off on the earlier Town Talk settlement.

Noteboom, who said Mallory twice stormed out of client meetings about a possible settlement, said the final figure from Keith was 15 percent to 20 percent more than the target set by the Jones family.

Sturns said Gwinda Burns, the attorney first contacted by the Joneses and who remained active in the case, was present at a key meeting on a possible settlement. But on Monday, Burns sharply criticized the eventual amount.

"I was looking for a much higher settlement," she said.