The legal battle that wouldn't die is heading back to court.
After 6 1/2 years and $80 million in legal fees, the war over ownership of Los Angeles-based Guess clothing--otherwise settled Wednesday when the company's feuding owners agreed to a multimillion-dollar truce--will go back before a judge to determine whether a partially completed jury verdict form should be read or destroyed.
The slip of paper has taken on an inordinate importance because of the unseemly feud between Guess' founders, the Marciano brothers, and their lead attorney, Marshall B. Grossman, that surfaced just as the settlement was being disclosed.
Accusing Grossman of reneging on a promise to represent them in all trials arising from their war with the owners of the Jordache clothing empire, the Marcianos turned to other lawyers to negotiate the settlement with Jordache and are refusing to pay Grossman the $10-million bonus he was promised if they won back control of Guess.
In a telephone conference Thursday, Grossman was the only lawyer who refused to go along with Los Angeles Superior Court Judge Norman L. Epstein's plans to destroy the document. It was filled out by a jury that had been deliberating three days in a case that would have set the damages that Jordache's owners, who bought 50% of Guess in 1983, owed the Marcianos for their misconduct as business partners.
Presumably, lawyers said, Grossman could use the jury form as ammunition in any claim he may pursue that his Century City law firm is due the $10-million bonus plus a percentage of the tens of millions of dollars the Marcianos will get from New York-based Jordache's owners, the Nakash brothers, in reclaiming control of Guess.
Grossman, however, said he wanted the document preserved because of the "substantial public interest" in the case.
In any event, how much help the document would be is unclear.
Jury foreman Edward Eng said the panel decided to award the Marcianos money on a finding that the Nakashes stole Guess trade secrets. He said the amount was undetermined, but would be "nowhere near" the more than $91 million sought by Guess. His account conflicted with that of another juror, Victor M. Herrera, who said the jury, in a preliminary vote, approved a $4-million award on that point.
Both Eng and Herrera said the jury made no decision on the other key money issue in the case.
Epstein has scheduled a hearing for June 19 on whether the verdict slip should be destroyed. In the meantime, Grossman has asserted a $17.7-million lien against the Marcianos' proceeds from the settlement.
The unusual lawyer-client feud, it turns out, had been brewing since last fall, putting Grossman and the Marcianos at loggerheads throughout the 3 1/2-month trial that abruptly ended with Wednesday's settlement.
Paul Marciano, spokesman for the brothers, said Grossman in November began backing away from what the Marcianos considered his written promise to represent them in all phases of the Guess-Jordache litigation. Bitter memos passed back and forth over Grossman's fees and the meaning of earlier agreements.
By January, the Marcianos were exploring a settlement with the Nakashes--one of a dozen such episodes during the long dispute. Georges Marciano, Guess' designer, was especially tired of all the fighting and proposed selling out his interest in Guess to his brothers, a source familiar with the discussions said.
Georges quickly abandoned thoughts of bailing out, but his qualms had brought two new lawyers into the case to represent the brothers' briefly divergent interests. As the battle with Grossman raged and momentum for a settlement grew, the new lawyers, Pierce O'Donnell and Richard M. Coleman, played an ever-bigger role.
Still, it was when the Nakashes and the Marcianos thrust all their lawyers aside in February that the outlines of a settlement took form. Working through an intermediary, Swiss-born businessman Claude Ravier, the warring families "got all the hard feelings put behind us and reach(ed) a number," Paul Marciano explained.
The break with Grossman--who Marciano said has been paid $10.58 million for five years of legal work--was complete by early April, when Grossman said he would be unavailable to represent the Marcianos in a federal suit charging the Nakashes' chief investigator with racketeering.
Grossman continued to represent the brothers in Epstein's court, but over the past two weeks, O'Donnell and Coleman hammered out the details of the settlement with Nakash lawyers Howard L. Weitzman and Frank Rothman.
O'Donnell said Thursday that the Marcianos settled, in part, because Grossman told them they faced up to four more years of litigation to win back control of Guess but refused to represent them to the bitter end. The brothers, O'Donnell said, were not just looking for a gambit to avoid paying Grossman his $10-million bonus.
"We didn't settle the case to cheat Marshall Grossman," said O'Donnell, whose other clients include columnist Art Buchwald, the recent victor over Paramount Pictures in a suit concerning the origins of the Eddie Murphy film, "Coming to America."
Grossman declined Thursday to comment on any aspect of the dispute, saying only the Marcianos could free him of his obligation as an attorney to keep their dealings private.
"Short of that, I can't yield to gamesmanship, however tempting it may be," he said.
Paul Marciano said he understood that partners in Grossman's firm, Alschuler, Grossman & Pines, were pressing Grossman to work out an agreement with the Marcianos.
But Grossman said his partners had "absolutely not" expressed objections to his conduct. And Robert A. Shlachter, a member of the firm's management committee, said Grossman's colleagues stood firmly behind him.
Times staff writer Stuart Silverstein contributed to this story.