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Ex-Client Suing K&L Gates in Texas Adds Hundreds of Millions In Damages After Discovery
K&L Gates continues to dispute the allegations in the conflict-of-interest suit, filed in Hays County.
By Brenda Sapino Jeffreys | December 08, 2020 at 11:46 AM

K&L Gates office sign(Photo by Diego M. Radzinschi/ALM)
In an amended petition filed Monday, a Texas company significantly increased the amount of damages it seeks from K&L Gates in a conflict-of-interest suit that a Texas appeals court recently booted back to a trial court.

In the amended petition, Quantum Materials Corp. of San Marcus seeks $20 million in actual damages and $260 million in punitive damages—making for a big jump in actual damages, and more than 2.5 times the total amount Quantum Materials sought originally.


In the original petition filed in 2018 in Hays County district court, Quantum Materials sought $100,000 in actual damages and $100.3 million in punitive damages.

Plaintiffs attorney Michael Minns, of Minns & Arnett, said the damage requests are higher in the amended petition because the plaintiff is now aware of more evidence to support its claims, due to discovery in related lawsuits in Florida and Kansas.

The causes of action—breach of fiduciary duty, alleged violations of the Texas Deceptive Trade Practices Act, and legal malpractice—are unchanged.

K&L Gates continues to dispute the allegations.

In the petition, Quantum Materials alleges K&L Gates engaged in a conflict of interest by representing the business and its lenders in a dispute over a loan. That dispute led to Quantum Materials being sued in three states.
Quantum Materials, which makes tetrapod quantum dots for use in lighting applications, said in its petition that it engaged K&L Gates as counsel in 2016 to do corporate work, including drafting documents for a prospective lender. The company later shifted that legal work in-house, but maintains in the petition that K&L Gates never formally resigned from the representation.

According to the allegations, K&L Gates seeks payment for $300,000 in legal fees, but Quantum Materials seeks a court order that it does not owe the money.

In response to the amended petition, a spokesman for K&L provided this statement:

“Not only is plaintiff’s lawsuit a meritless tactical effort to avoid paying our firm the outstanding fees that it owes, but the preposterous relief sought by plaintiff lacks any basis in reality whatsoever. We will continue to vigorously defend against plaintiff’s baseless claims and pursue judgment on our counterclaim for fees, and are confident we will prevail.”

The suit was sent back to the trial court in October, after a three-judge panel of the Austin appeals court affirmed an order denying K&L Gates’ motion to dismiss the suit under the Texas Citizens Participation Act, also known as the Texas Anti-SLAPP statues, and the Texas Supreme Court declined to take the interlocutory appeal.

Read More:
Malpractice Suit Against K&L Gates Heads Back to Texas Trial Court

Texas Malpractice Suit vs. K&L Gates Claims Firm Abandoned, Then Sued, a Client


Brenda Sapino Jeffreys
Brenda Sapino Jeffreys
Senior reporter Brenda Sapino Jeffreys covers the business of law in Texas. Contact her at bjeffreys@alm.com On Twitter: @BrendaSJeffreys


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