Loredana Nesci passed the Connecticut bar exam on her first try. But she was not happy about the cost of the BAR/BRI bar review course she'd taken. By the time she graduated from Quinnipiac University School of Law in 2002, she was $60,000 in debt. She had to scrape up another $1,800 for the six-week course, which consisted of written materials and videotaped lectures.
Nesci was perplexed. "I thought that something was wrong," she recalls, "because every year [BAR/BRI] would hike up its prices, and I couldn't understand why it had no competition." In 2005, after hearing about a class action challenging BAR/BRI for alleged antitrust violations, Nesci signed on as a lead plaintiff.
Since then, Nesci and two other lead plaintiffs-Lisa Gintz and Ryan Rodriguez-have found themselves opposing not only BAR/BRI, but also the law firm representing them, Richmond-based McGuireWoods. At issue is the $49 million settlement that McGuireWoods negotiated with BAR/BRI parent West, a division of The Thomson Corporation, and Kaplan Inc., West's marketing partner. Nesci, Gintz, and Rodriguez argue that the proposed settlement lets West off the hook too lightly, and they have demanded that the court reject it.
They have a surprising ally in Eliot Disner, the lawyer who originally filed the suit. In May, Disner, then a partner in the Los Angeles office of McGuireWoods, broke ranks with his firm and let his objections to the settlement be made public. Less than a week later, McGuireWoods fired him. At press time Disner and the objecting plaintiffs were awaiting a June 18 hearing before federal district court judge Manuel Real on whether the settlement should be approved.
Disner, a veteran antitrust litigator, filed the suit in 2005, alleging that law school graduates were overpaying as much as $1,000 for the BAR/BRI-branded courses that West offers nationwide. When recruiting lead plaintiffs for the case, Disner trumpeted the evidence as so strong that it could lead to the breakup of BAR/BRI, Nesci, Gintz, and Rodriguez say. Both West and Kaplan have denied violating antitrust laws.
Disner was then a partner at Los Angeles's Van Etten Suzumoto & Becket. His firm merged with McGuireWoods in 2006. The BAR/BRI case went with Disner to McGuireWoods, but it put the Richmond firm-known for representing large corporate clients-in an atypical role as plaintiffs counsel.
As McGuireWoods pursued settlement negotiations with West and Kaplan, Disner seemed to fade into the background, Nesci says. "He declined to answer my questions," she says. "I'm, like, what is going on here?"
Under the settlement that McGuireWoods negotiated, West would pay $36 million, and Kaplan $13 million. Each class member-one of the almost 300,000 law school graduates who took a BAR/BRI course between 1997 and 2006-would receive an average of $125 each. Another $12 million would go toward attorneys' fees.
Four of the lead plaintiffs in the class action have agreed to the proposed terms. But since last winter, when McGuireWoods revealed the proposal to Nesci, Gintz, and Rodriguez, they have been waging a campaign to derail it. In an objection they fired off to Judge Real in March, they charged that the settlement "does nothing to curb BAR/BRI's illegal and monopolistic practices." At a hearing later that month, Nesci's was the lone voice urging the judge-unsuccessfully, as it turned out-not to grant preliminary approval of the settlement.
At the same hearing, seeking to remove the dissidents from the class they were representing, McGuireWoods asked the court if it could withdraw as their counsel. Judge Real denied the motion.
Opposing the settlement was no small decision for the three dissidents, who have little time or money to spare at this stage in their careers. The proposed settlement would pay each of them $25,000. Nesci and Gintz, who graduated from Louisiana State University's Paul M. Hebert Law Center in 2004, are both solo practitioners-Nesci in Studio City, California, and Gintz in Baton Rouge. The third dissenting lead plaintiff, Rodriguez, is a deputy district attorney in Los Angeles.
Nesci, a former police officer who says that she grew up rebelling against the strict rules established by her Italian immigrant father, says that she didn't want to give up without a fight. She says she concluded that BAR/BRI was "getting away with murder here. [The company] was just going to pay us off and continue doing what they were doing." The three dissenting lead plaintiffs are not alone in opposing the settlement. All told, 47 class members have objected to it for various reasons, says William Allcott, a McGuireWoods partner and spokesman.
In March, Disner filed an affidavit that appeared to give tepid support to the settlement. But by May he had quietly drafted a brief arguing that the claim against West was potent enough to justify at least a $400 million judgment and the breakup of the company. The 13-page brief, which the three dissenting plaintiffs obtained from him and filed in court on May 17, put him squarely and publicly at odds with his own firm.
Disner's brief portrayed BAR/BRI's 1997 purchase of the assets of West Bar, its only major national competitor, as a clear-cut violation of Clayton Act provisions that outlaw anticompetitive agreements. Today BAR/BRI, the nation's largest provider of full-service bar review courses, accounts for as much as 90 percent of the market, according to Disner's original complaint.
Five days after the brief was filed, McGuireWoods fired Disner. "Your activities with respect to the BAR/BRI case have caused substantial damage to McGuireWoods and its reputation," the firm said in its termination letter. McGuireWoods's Allcott says that Disner still stands to collect 30 percent of attorneys' fees under a contract that came with him to McGuireWoods from Van Etten Suzumoto. The sum would almost certainly increase in the event of a larger settlement.
Since Disner became a free agent, his split with McGuireWoods has only deepened. On May 31 Disner asked Judge Real for permission to represent Nesci, Gintz, and Rodriguez as cocounsel. McGuireWoods strongly opposed Disner's motion, saying that he had no standing to act as cocounsel for clients opposed to the settlement. At press time both sides were waiting to see whether Judge Real would approve the settlement at the June 18 hearing. If the judge approves the settlement, Nesci says, she is likely to appeal.