Brobeck, Phleger & Harrison was trial counsel for Jordache Enterprises, Inc. in one of the most massive civil cases ever litigated in southern California, Marciano v. Nakash. The Marciano case involved the ownership of Guess?, Inc., an extremely successful apparel company, and included a variety of tort claims among parties including Guess? and the four Marciano brothers, and Jordache and the three Nakash brothers. The Marciano case spun off related proceedings throughout the world, from California to Delaware, New York and Hong Kong.

Some of the parties in the Marciano case had insurers paying for all or part of their attorneys’ fees and expenses, but Brobeck never raised with Jordache any issue about the potential for insurance defense or indemnity coverage of the claims asserted in the Marciano case. As a result, for almost three years Jordache did not make a claim for defense and indemnification of the Marciano case directly to any insurer, and Jordache went without any insurance defense. Jordache paid Brobeck and other counsel well in excess of $30 million in fees and expenses over the duration of the Marciano case.

Years later, Jordache learned from others of the potential for insurance coverage of the claims made in the Marciano case. After receiving no response to formal demands to the insurers for defense and indemnification of claims in the Marciano case,

Jordache retained the Conkle Firm to pursue claims against its insurers. Conkle, Kremer & Engel initiated bad faith and breach of insurance contract lawsuits in Los Angeles Superior Court against several insurers to enforce Jordache’s rights under the insurance policies. The insurers persisted in refusing to defend or indemnify Jordache.

In the first of Jordache’s insurance actions to be set for trial, Jordache v. National Union, Los Angeles Superior Court Case No. C 675 743, National Union asserted a number of defenses including lack of coverage and that they were relieved of any duty to come to Jordache’s aid because the notice they received of the Marciano case was late. Jordache argued that coverage existed, and that notice to Jordache’s insurers was not late. On cross motions for summary adjudication, the trial judge ruled that Jordache had proved that there was coverage for the claims asserted in the Marciano case (in fact, the judge held that Jordache had shown a “cornucopia” of covered claims). However, the judge also found that notice of the Marciano case to National Union was late. A trial was scheduled to determine whether National Union should be relieved of its duty to defend and indemnify Jordache because it had suffered “substantial prejudice” as a result of the late notice.

Within days of the ruling by the trial judge that there was insurance coverage, Jordache settled its claims against the insurers for $12.5 million.

Read about the legal malpractice action Jordache has pursued against Brobeck, Phleger & Harrison, based on the law firm’s failure to advise Jordache of the potential for insurance coverage of claims in the Marciano case.


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