(Reuters) – The CEO of Los Angeles-based health information database company Prism Science LLC on Monday sued U.S. law firm Seyfarth Shaw for at least $13.5 million, alleging the firm botched the sale of his other companies to a London-based private equity firm.
In a lawsuit filed in Manhattan federal court, Mahesh Naithani claimed the companies were initially valued at $100 million by their buyer, Inflexion Private Equity Partners LLP, before Seyfarth’s faulty advice led to their sale for less than half that amount.
Inflexion bought the companies — Medmeme LLC, Pharmaspectra LLC and Medical Intelligence Solutions LLC — for about $43.2 million in 2019, the lawsuit said. Naithani alleged that had Seyfarth properly advised him, he would have rejected Inflexion’s lowball offer.
A Seyfarth spokesperson did not immediately respond to a request for comment. A lawyer for Naithani and his companies declined to comment.
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Seyfarth earned $2.25 million from its work on the Inflexion acquisition, the lawsuit said. Naithani said he is seeking at least $13.5 million in damages.
Naithani also alleged that Seyfarth’s negligence put him on the hook for a $25 million breach-of-warranty claim Inflexion later filed against him. The claim resulted in a settlement and $2 million in “unnecessary and wasted legal fees,” Naithani said in his lawsuit.
The case is M3 Cubed US LLC v. Seyfarth Shaw, U.S. District Court for the Southern District of New York, No. 1:23-cv-00957.
For the plaintiffs: Joshua Ray of CANDEY
For Seyfarth Shaw: Unknown
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David Thomas reports on the business of law, including law firm strategy, hiring, mergers and litigation. He is based out of Chicago. He can be reached at [email protected] and on Twitter @DaveThomas5150.
