Litigation | Claim as leverage in negotiations

In a project for building a sterilization plant using gamma radiation, which had been advanced from the entrepreneurship stage until its maturation, the legal services were terminated following the enrollment of an entrepreneurship company that demanded a change in the employee structure (see the projects chapter: “consultation in a partners’ conflict”).

On the one hand, it was obvious at that stage that the project company had no sources for paying the fee, unless it would be able to complete its formation. On the other hand, giving all the documents without structuring a model to secure the payment reduced the chances of collection to zero.

Accordingly, shortly before statutory deadline for transferring documents, a pecuniary claim was filed to delay the transfer of the documents and exert pressure for structuring a model to secure the payment. The claim was filed with the hope of reaching as settlement, while the entrepreneur and the new partners were free to advance the move.

To give the move credibility, an arrangement was formed with a well-known attorney whereby he and his office would be the attorneys of the move, while in practice the payment would only be for meetings in which the well-known attorney would appear.

Unfortunately, the entrepreneur and the new partners were unable to advance the project, and the only thing left to do was manage a claim.