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Associates received referral fees but shareholders did not.
If an associate brought a case to CSB (i.e., was the “source
attorney”), he or she would get 25 percent of CSB's fees after
the first $5,000. CSB kept records showing who brought each case
to CSB and showing which attorney had a right to receive fees.
C. CSB's Shareholders Agreement
CSB's shareholders executed a shareholders’ agreement (the
1973 agreement) on January 23, 1973. Under the 1973 agreement,
CSB agreed to buy a deceased shareholder's interest in CSB and
pay the shareholder's widow3 or estate the following amounts:
1. The amount the deceased shareholder paid for his stock.
2. A share of the amount of any earned but unpaid
corporate profits or dividends.
3. The amount of any earned but unpaid salary of the
deceased shareholder.
4. The amount of any incurred expenses or loans
unreimbursed to the shareholder.
5. Twenty-five percent of the net amount received by CSB
after the shareholder's death for cases the deceased
shareholder brought to CSB.
6. Ten percent of the net amount CSB received on cases
pending when the shareholder died which came to CSB
3 The 1973 agreement uses the term “widow”, not “surviving
spouse”.
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Last modified: May 25, 2011