Suit accuses BigLaw partner of 'regurgitating' claims of con artist who claimed to be CIA agent
A Swiss oil trading company alleges in a lawsuit that a Baker & Hostetler partner was either fooled by a con artist claiming to be a secret CIA operative or was a conspirator in the man’s scheme. (Image from Shutterstock)
A Swiss oil trading company alleges in a lawsuit that a Baker & Hostetler partner was either fooled by a con artist claiming to be a secret CIA operative or was a conspirator in the man’s scheme.
Paramount Energy & Commodities SA alleges in the May 6 suit that the alleged con artist sought to gain control of the company, which is effectively owned by Dutch oil trader Niels Troost.
The suit identifies the Baker & Hostetler partner as Jeffrey P. Berg and names him as a defendant. The alleged con artist introduced Troost to Baker & Hostetler and Berg, according to the suit, filed in state court in Los Angeles.
The alleged con artist said Paramount Energy & Commodities SA could not participate in a joint CIA-FBI program because it was 100% foreign-owned, the suit says. He advised Troost to transfer half of his ownership to a U.S. holding company that benefited the con artist to allow participation in the program.
Baker & Hostetler advised Troost on the inversion, which would make Paramount Energy a subsidiary of a new U.S. company, the suit says.
Law360, Reuters and the Daily Journal have coverage.
The Los Angeles-based Berg allegedly vouched for the alleged con artist, saying he had power and influence with the U.S. government. The suit accuses Berg of “regurgitating” the man’s “fraudulent story” that he was carrying out an operation for the U.S. government.
“On information and belief,” the suit says, Berg “was either a conspirator in the scheme perpetrated by [the alleged con artist], or like Mr. Troost and others, had been fooled” by the man.
The suit claims that Berg and the alleged con artist were partners in a South African business, a fact not disclosed in a conflict waiver when the alleged con artist hired Baker & Hostetler as counsel.
Paramount Energy fired Baker & Hostetler in May 2023 after Troost hired investigators and attorneys to investigate the man’s claims.
Troost wrote a letter rescinding the agreement to transfer half of Paramount Energy to a holding company, citing alleged deception revealed in the investigation.
Paramount Energy asked for return of its client file, but the law firm did not comply, according to the suit. The firm cited a dispute over the ownership of Paramount Energy and said the file would not be released until the issue is resolved.
The suit alleges that Berg took the side of the alleged con artist when he wrote a letter to the Swiss ambassador to the United States.
The letter claimed that Paramount Energy may alter records to remove as a shareholder the Swiss holding company benefiting the alleged con artist.
Berg also revealed attorney-client privileged communications about a Paramount Energy audit in a letter to the the ambassador, and, in an “ultimate betrayal,” said Paramount Energy’s accounts should be frozen, the suit alleges.
The suit claims legal malpractice and breach of fiduciary duty.
Paramount Energy traded Russian oil; it has since entered voluntary liquidation.
The United Kingdom sanctioned Paramount Energy in February, alleging that the company had facilitated the trade of Russian oil to avoid sanctions imposed after the invasion of Ukraine, according to the Daily Journal. The sanctions are being challenged.
Berg and Baker & Hostetler did not immediately respond to an ABA Journal email seeking comment.
