Lee G. Gale - Page 8




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          In exchange for the reduced hourly rate, petitioner agreed to pay           
          a graduated contingency fee that would apply to any recoveries              
          from petitioner’s various litigation matters in excess of a                 
          specified minimum amount.  For a recovery of less than $1                   
          million, Lurie & Zepeda would be entitled to a contingency fee of           
          25 percent of the amount recovered in excess of $400,000.                   
          Petitioner also granted Lurie & Zepeda a lien against his                   
          recoveries to secure his obligations under the fee agreement.               
               Shortly after the fee agreement was executed, a fee dispute            
          arose between petitioner and Lurie & Zepeda.  In 1990, to secure            
          payment of $750,000 in disputed fees then owed to Lurie & Zepeda,           
          petitioner granted Lurie & Zepeda a lien against some rental real           
          property he owned.                                                          
               On the basis of its claims for unpaid legal fees and costs             
          in connection with the various matters on which it represented              
          petitioner, Lurie & Zepeda refused to release any of the United             
          Ready Mixed settlement proceeds to petitioner during 1992.  Lurie           
          & Zepeda released the following amounts from the trust account in           
          1993 and 1994:  (1) $5,500 paid on behalf of petitioner to Max              
          Binswenger in 1993; (2) $200,000 paid to Lurie & Zepeda for legal           
          fees in 1993; and (3) $250,000 and $5,391.94 paid to petitioner             
          directly in 1993 and 1994, respectively.  Lurie & Zepeda released           
          other amounts in later years not at issue in these cases.                   








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