LLF's Joanna Kopczyk and Alex Passo Obtain Six-Figure Settlement On The Eve of Trial In a Case Defendant Derided As "Nuisance Value"

When a defendant in newly filed litigation characterizes the suit as worth “nuisance value,” a negotiated settlement that reflects the actual worth of the plaintiff’s claims is an unlikely outcome. But, in February 2024, LLF’s Joanna Kopczyk and Alexander Passo obtained a six-figure settlement on the eve of trial in just such a case.

The firm represented a plaintiff that helps other businesses identify, capture, and defend federal and state research and development tax credits for which they may be eligible. When obtained, these credits can save a business hundreds of thousands or millions of dollars in taxes.

In 2010, the plaintiff entered into a contract with the defendant pursuant to which it agreed to provide services and advice in identifying and applying for R&D tax credits for 2008, 2009, 2010, 2011, and 2012. Under the contract, the plaintiff was to receive as compensation a fee based upon a percentage of the credits received by the defendant. The contract provided that the defendant would pay the plaintiff when the credits were used to reduce tax liabilities in future years.

The plaintiff’s efforts resulted in tax savings for the defendant in the high six figures. When the plaintiff invoiced the defendant for the services per the contract terms, the defendant failed and refused to pay the agreed-upon sum.

Based on the foregoing, LLF filed suit on behalf of its client in December 2022, alleging breach of contract and other claims against the defendant. At the time of filing, the extent of compensation due to plaintiff was not fully ascertained. The plaintiff had to uncover how much of the credits were utilized.

During the litigation that ensued, the defendant took the position that the case had little to no merit and made paltry settlement offers that represented a tiny percentage of the amounts actually owed under the contract. Accordingly, Kopczyk and Passo prepared the case for trial, building a robust case, and establishing (and uncovering) its damages. The day before the trial was to commence, the defendant made a six-figure offer to settle the matter that was accepted by a very satisfied client.

The firm congratulates Joanna and Alex for this outstanding result obtained for our client.