Brobeck, Phleger & Harrison v. Telex Corp.

Telex Corporation (Telex) (defendant) won a substantial judgment in a federal antitrust lawsuit involving International Business Machines Corporation (IBM). IBM appealed, and the appellate court reversed the district court’s judgment in favor of Telex and instead awarded IBM a substantial judgment on its counterclaims. Telex desired to petition the United States Supreme Court for review and set out to find the most competent antitrust lawyer it could retain. After researching the market of available lawyers, Telex entered into a retainer and fee agreement with an attorney at Brobeck, Phleger & Harrison (Brobeck) (plaintiff). Subject to certain conditions, the fee agreement provided that Brobeck would be entitled to a minimum of $1,000,000 in fees if the case proceeded as far as the filing of a petition for a writ of certiorari with the United States Supreme Court. Brobeck’s fee entitlement would have decreased to $25,000 if the Supreme Court denied the writ of certiorari, but Telex and IBM resolved their dispute through a negotiated settlement before the Supreme Court issued a decision on Telex’s petition. Brobeck withdrew the petition for certiorari and later provided Telex with a bill for $1,000,000. Brobeck filed suit when Telex declined to pay the requested fees; Brobeck won summary judgment at the district court level. Telex appealed the award of summary judgment.