They were once good friends and colleagues. They are both well-known legal recruiters. But in three weeks, they will be squaring off at the U.S. Court of Appeals for the Fifth Circuit in what has become a long and bitter battle of attrition.
The question before the court is whether an Austin federal judge abused his discretion by enjoining a Hong Kong legal action. But perhaps the more interesting question is how the underlying lawsuit between Robert Kinney and Evan Jowers got so nasty in the first place.
The case has fostered gossip and gasps from the legal press. The foot-dragging and cross-charging have ticked off a federal judge and puzzled a Hong Kong jurist. A major law firm — a sometimes client of both recruiters — has been publicly criticized for its sluggish response to subpoenas. And in the latest twist yet, another major law firm has withdrawn from the case.
Last Friday, DLA Piper withdrew its representation of Jowers with the blessing of the court. The lawyers of record — Marc Katz, James Bookhout and Marina Stefanova — were appropriately vague about their reasons, citing the most ambiguous Texas Disciplinary Rule 1.15(b)(7). But Jowers will now apparently be represented by Robert Tauler, a lawyer from Los Angeles, assuring the struggle will continue.
DLA Piper is still handling Jowers’ appeal to the Fifth Circuit as well as his lawsuit in Hong Kong, if the Fifth Circuit paves the way for the transpacific suit to continue.
Stripped of its venom, the case is about debt collection. Kinney claims Jowers owes him for an unpaid loan and advances against commissions. But it is the extraordinary bitterness between the two that has morphed the litigation into a three-year slog, one that hasn’t seemed to weary either side.
Kinney accuses Jowers of stealing clients, running up outrageous expenses, violating a noncompete agreement, stealing trade secrets and perpetrating a calculated scheme against him. Jowers claims Kinney treated him unfairly, coerced him to sign unfairly restrictive employment agreements and bad-mouthed him after he left Kinney’s firm.
In May 2019, Jowers filed a defamation suit against Kinney. Last December, U.S. District Judge Robert Pitman stopped it in its tracks. Reasoning that the Hong Kong maneuver was a “vexatious and oppressive” duplication of the action already in front of him, he issued an anti-suit injunction against Jowers.
It’s an issue that has been reviewed by the Fifth Circuit only a half-dozen times over the last half-century. And even before considering the uncertain future of any litigation in Hong Kong, it adds a touch of novelty to this modern legal duel, which began as a basic employment contract dispute and has metastasized into an expensive, time-consuming global litigation.
The First Punch
Like most successful legal recruiters, Kinney and Jowers began their careers as lawyers. Kinney, a University of Texas law graduate, started out as an admiralty litigator in Houston, then moved to Austin and corporate practices in technology and IP. Jowers, who got his law degree from Boston University, started as an associate with Cadawalader, then spent three years as general counsel for an international garment manufacturer based in Miami.
According to court records, Kinney and Jowers first met at BCG Attorney Search after putting their law practices in the rear-view mirror. Kinney had joined BCG in 2001 around the time the law firm he was working for began to collapse, but he left after three years. Jowers later joined him.
Kinney’s firm is Austin-based MWK Recruiting, formerly known as Kinney Recruiting. (Note: It is also currently known as Kinney Recruiting on the firm’s website.) At 16 years old, the firm describes itself in court documents as home to “some of the best-known legal recruiters in the world,” serving high-end law firms and exclusive in-house legal departments at Fortune 500 companies around the globe. Including Kinney, the company website lists eight recruiters with offices in Houston, New York and Frankfurt.
Jowers joined Kinney in 2006 and worked with him for a decade, dividing his time between Miami and Hong Kong, where he was spearheading the firm’s growth in the Asian market. During his 17-year legal recruiting career — a majority of which was spent with Kinney Recruiting — Jowers claims placement of more than 400 lawyers throughout Asia for firms like Kirkland & Ellis, DLA Piper and Vinson & Elkins. According to court records, Jowers was at least partially involved in at least 185 Asia and Middle Eastern placements during his employment.
When Jowers left Kinney in 2016, he joined forces with Alejandro Vargas, a South American attorney and former Kinney candidate who practiced at Davis Polk and Skadden before shifting his career to recruiting. Their firm, Jowers/Vagas, advertises 11 recruiters with offices in New York, Hong Kong, Boston, London and Moscow.
Jowers’ employment contract with Kinney included an industry generic nonsolicitation agreement which barred him from taking Kinney clients or employees with him when he left or using proprietary information for at least the first year after his departure.
Kinney alleges that Jowers violated those terms — and more. In a lawsuit filed in March 2017 in state court in Austin, Kinney sued Jowers. He sued Vargas. He sued Jowers’ ex-wife, who had departed from the Kinney firm with Jowers. He accused Jowers of stealing clients and engaging in a “calculated scheme of deception and dishonesty” to generate extra compensation for himself even as he was preparing to leave and set up his own business. Kinney claims he left owing money: $24,000 from an unpaid loan and $61,000 in accrued expenses that were supposed to be deducted from Jowers’ future earnings.
Both Vargas and Jowers’ ex-wife, Yuliya Vinokurova, were later dismissed from Kinney’s lawsuit.
‘A Toxic Employment Relationship’
For a time, the matter was quiet.
It took Kinney a year to serve Jowers with the lawsuit. Jowers was traveling to avoid service, according to Kinney (“This guy was running around the world and I couldn’t pin him down,” Kinney told The Texas Lawbook). Kinney filed the suit but ignored it, a lawyer for Jowers suggested. Whatever the reason for delay, Kinney served Jowers at a spring conference hosted by the National Association for Law Placement at a South Florida beach resort.
Then things got nasty.
Jowers moved Kinney’s lawsuit to federal court. He hired DLA Piper, both to defend him and to pursue separate litigation, including the lawsuit in Hong Kong.
In the Hong Kong action, which was filed in May 2019, Jowers claims Kinney defamed him in a series of emails to recruitment candidates and to firms Jowers had been working with at the time he left to begin his own firm.
While the Hong Kong action is over a narrow issue, Jowers spilled his account of his employment with Kinney a few months later in a countersuit he filed in Austin federal court.
In the August 2019 countersuit, Jowers describes Kinney as a manipulative boss who exploited “a toxic employment relationship” using “bait and switch” incentives, lawsuits and threats of lawsuits to steal commissions. The pressurized environment, Jowers alleges, ranged from uncomfortable to hostile for both women and men. At one point, Jowers said, Kinney recommended that he obtain a prescription for a stimulant so he could work longer hours.
He said Kinney routinely withheld commissions and bonuses to elicit contract concessions from employees and inserted himself into placements so he could pocket a portion of the commissions — often a disproportionate share. So egregious was Kinney’s conduct, Jowers claimed, that it amounted to extortion and racketeering, and he asserted some of his claims under civil RICO statutes.
“At its core, this lawsuit arises from … an employee’s desperate struggle to break away from his employer’s cycle of deceit,” the countersuit says.
Included in the RICO claims was an accusation of “predatory lending.” The claim arose from the manner in which recruiters are typically paid. Like many salesmen, recruiters are often paid a modest base salary and receive the bulk of their pay through commissions earned when they place candidates at law firms.
Because it often takes up to six months between the time a candidate is placed to the time the benefiting firm pays a placement fee, it is not unusual for the recruiting firm to pay its recruiters interest-free advances based on expected commissions. In some cases, expenses are deducted from commissions to allow the company to recoup recruitment costs — in essence, a loan against future revenue commonly referred to as a “draw.”
Such was the case with Jowers. According to the countersuit, Kinney agreed at the time of Jowers’ April 2006 hire date to pay Jowers a $3,000 per month base salary and promised interest-free advances on commissions when placements were made.
At first, Kinney upheld his end of the bargain. He paid Jowers advances without interest and without a formalized, written agreement.
But Jowers said things changed at the end of 2006, after he successfully placed several attorney candidates resulting in several hundreds of thousands of dollars in commissions in the pipeline. Jowers said Kinney withheld his commissions until he signed a backdated employment contract that contained the restrictive clauses — contrary to a promise made by Kinney when he was employed. Jowers claimed he signed the agreement under duress.
Throughout most of Jowers’ employment, he was the highest revenue-generating recruiter at Kinney, a claim that Kinney doesn’t dispute. But Jowers said conditions continued to worsen, even as Kinney made money off Jowers’ work.
In 2012, Jowers said Kinney reneged on a promised bonus of as much as $150,000, offering instead a $50,000 forgivable loan. And around the same time, Kinney began also paying Jowers’ commission advances in the form of high-interest loans.
“After Jowers began to rely on these monthly advances and planned his financial spending based on them, Kinney decided to unilaterally cut Jowers’ ‘salary’ to $10,000 per month and charge 17% interest on any advances beyond that figure,” the countersuit says.
By the end of 2012, through alleged coercion by Kinney, their arrangement had evolved into a revolving loan agreement.
“Once again, Kinney coerced Jowers to sign the agreement by threatening to terminate him, refusing to make any further advances, threatening to keep the commission fees Jowers had already earned, and threatening to sue him if he quit and began working as a recruiter elsewhere,” the countersuit says.
Jowers moved to Hong Kong in 2015 to devote full time to the firm’s Asia expansion. Jowers’ expenses increased dramatically, but so did Kinney’s unwillingness to pay, Jowers claims. Although Kinney had promised to shoulder certain expenses — like the $30,000 required for a Hong Kong work visa — Jowers said he ended up paying it out of his own pocket.
By October 2016, Jowers said his relationship with Kinney had “greatly deteriorated,” and despite the presence in the record of a resignation letter, Jowers says he was fired.
Jowers claims he wrote the resignation letter to stave off any doubt that he was leaving the firm. Before submitting the letter, however, Jowers said Kinney’s accountant confirmed to him in writing that the revolving debts he had been responsible for were fully paid.
“I believe that Kinney’s lawsuit is a vindictive attempt to get back at me for deciding to leave his business and going out on my own,” Jowers told The Texas Lawbook through his lawyers. “I look forward to the opportunity to disprove his allegations against me in court and demonstrate that Kinney cannot continue to bully his current and former employees without any consequences.”
‘Heinously Lavish’
“I will miss some things about Evan; he’s entertaining and has endless patience for some really annoying candidates,” Kinney wrote in January 2017 to John Fadely, then a partner at Weil, Gotshal & Manges’ Hong Kong office. “But he’s an organizational nightmare.”
That sentiment, from one of the emails Jowers says defamed him, typifies Kinney’s case against Jowers. For Kinney, many of the financial instruments Jowers claims were coerced were actually designed to protect Kinney — as well as Jowers — from what he maintains was Jowers’ profligate spending: his “heinously lavish, arrogant and unaffordable lifestyle choices,” as Kinney described them to the court.
Kinney says Jowers arrived at Kinney Recruiting in 2006 “completely without financial means and highly indebted because of personal loans, student loans and tax liens exceeding $100,000.” He maintains that not much changed after that. Jowers was an employee who could never get his spending under control, no matter how much his salary increased, Kinney claims.
In contrast with Jowers’ claim to have made several placements by the end of 2006, Kinney describes Jowers’ first year at Kinney Recruiting as a “slow start” — with a single, partial placement. By contrast, Jowers’ draw account reached $100,000 by February 2007.
Over the years, Kinney claims, the draws paid for a $12,000 birthday party, a family vacation north of $30,000 and a tony $12,000 per month Hong Kong apartment at the Four Seasons Place, a location popularized by mainland Chinese billionaires. Between January 2010 and December 2016, Jowers’ draws averaged $76,000, but went as high as $232,000, according to court files. During that 84-month period, Kinney’s lawsuit says, the balance stayed at zero for less than two months. The $30,000 work visa described by Jowers “took a back seat,” Kinney admitted, because Jowers’ expenses “were so far out of line with any realistic expectations about the prospects for business growth led by Jowers in Asia.”
Kinney said the revolving loan agreement was created at Jowers’ request and despite a gross income totaling between $300,000 and $700,000 per year throughout most of his time at Kinney Recruiting, Jowers was never able to save money.
“The entire business would have been in jeopardy with even a modest slowdown in placement activity, especially after adding the burden of office rent and staff salaries in Hong Kong,” Kinney’s lawsuit says.
And that back-dated contract with the restrictive covenants Jowers said he was forced to sign? Kinney said the contract was created in December 2006 and signed by all Kinney Recruiting employees after it was discovered that a firm employee had stolen the firm’s database.
The Appeal
Currently, Jowers and Kinney are scheduled to take their fight to trial in Judge Pitman’s court next February. But for now, the fight has flipped from Austin to Hong Kong to New Orleans.
Jowers has appealed his case to the Fifth Circuit, arguing that the judge abused his discretion by issuing a foreign antisuit action enjoining him from pursuing the Hong Kong case. It’s an unusual remedy and one the Fifth Circuit hasn’t dealt with since 2003, in Karaha Bodas v. Perusahaan Pertambgangan Minyak Dan Gas Bumi Negara. Currently, oral argument is set for June 29 in New Orleans.
Jowers argues that Judge Pitman didn’t consider all the factors required by Bodas, including such factors as international comity. Judge Pitman erred, Jowers argues, by only considering whether the cases filed in Austin and Hong Kong were similar in nature and failed to consider that there were defamation claims made in Hong Kong that were not included in the Austin lawsuit.
Kinney, who plans to argue the case himself, argues that Jowers has failed to distinguish the Hong Kong case from the Austin case and that comity argument is ridiculous.
“In fact, comity counsels in favor of the injunction,” Kinney wrote in response. “These arguments make no sense.”
Plus, “There’s no chance this would cause trade wars in China,” Kinney told The Texas Lawbook.
In fact, given the status of the Hong Kong litigation, it could be argued that Judge Pitman had saved Jowers both time and money.
Last November, the Hong Kong judge in the matter, Master Kenneth A. Y. Lam, denied a request by Jowers to conduct extra discovery in order to draft a more detailed complaint. He described Jowers’ request as being “like an attempt to fish for new causes of action.”
He awarded Kinney HKD$165,642, or about US$21,500 in attorneys’ fees. But he also wondered why Jowers’ had sought the discovery in the first place, since the emails already in his possession showed “a strong prima facie case that (Jowers) has indeed been defamed by (Kinney).”
In fact, the time and money invested may be the best evidence of the bitterness that abounds in the case.
While he has been, at points, assisted by lawyers Raymond Mort of Austin and Tristan Loanzon of New York, Kinney has pursued the litigation mostly on his own behalf. And while Kinney appears to enjoy the litigation as intellectual sport, Jowers seems to have spent a small fortune on lawyers. His DLA Piper attorneys, Katz and Bookhout and Stefanova, did not come cheap.
Moreover, Jowers’ dogged rebuff of subpoenas and of discovery in general has become a matter of courthouse criticism, perhaps spilling over to some of the law firms he’s sought as potential allies. Given the obvious expense of a war of attrition, why not just settle and move on with his professional life?
Jowers, through his lawyers, wouldn’t answer that question. But Kinney, for his part, was happy to.
“For the other side, it’s pride and principal. For me, it’s money,” Kinney told The Texas Lawbook. “It’s a business matter, pure and simple. Hopefully we’ll get past it.”
Note: This article has been updated to include clarifying information 1. On the status of DLA Piper in their representation of Jowers, and 2. Additional details regarding the Hong Kong case. A correction has also been made to reflect that Jowers has worked in legal recruiting for 17 years. An earlier version of this article stated that he had been a recruiter for 13 years.