By Scott Flaherty, From The Am Law Daily

When Willkie Farr & Gallagher disclosed an ex-partner’s communications with opposing counsel in litigation over credit card “swipe” fees charged by MasterCard Inc. and Visa Inc., merchants opposed to a multibillion-dollar settlement in the antitrust case pounced on the revelation in an effort to undercut the deal.

Now, if some of those merchants have their way, a plaintiffs lawyer who purportedly shared confidential documents with ex-Willkie partner Keila Ravelo could lose $32 million in fees that he was already awarded in the case.

On Tuesday, a handful of retailers that objected to a $5.7 billion settlement in the swipe-fee case urged a federal judge in Brooklyn to vacate attorney fees awarded to Gary Friedman of the Friedman Law Group. Friedman was among the plaintiffs lawyers in consolidated antitrust litigation accusing Visa and MasterCard of charging excessive interchange fees to merchants that accept their payment cards.

Friedman also previously served as lead plaintiffs counsel in a similar swipe-fee class action against American Express that settled in 2013, though that deal is also facing a challenge.

Tuesday’s motion, filed by Sudbury, Massachusetts-based lawyer John Pentz, calls attention to emails between Friedman and Ravelo, a former Willkie and Hunton & Williams partner. Friedman and Ravelo had been friends for more than two decades after working together as associates at Sidley Austin, but they were on opposing sides of the swipe-fee litigation, with Ravelo at one point taking part in MasterCard’s defense.

As affiliate publication the New Jersey Law Journal has reported, Ravelo, pictured right, currently faces criminal charges that she bilked Willkie, Hunton & Williams and her client, MasterCard, out of more than $5 million. In December, federal prosecutors in New Jersey accused Ravelo and her husband, Melvin Feliz, of creating two dummy litigation support companies and using Ravelo’s position to funnel the firms’ money into those entities. (Coincidentally, Ravelo met her husband while she was working on a criminal pro bono case alongside Friedman at Sidley. Feliz, who’s had his own legal troubles, was the pro bono client.)

Following Ravelo’s arrest, Willkie engaged in an internal review of her conduct as it related to the swipe-fee litigation. In February, the law firm informed U.S. Magistrate Judge James Orenstein, who’s overseeing aspects of the antitrust case, that the probe uncovered potentially troubling exchanges between Ravelo and Friedman.

According to the firm’s letter, Willkie discovered that Friedman provided Ravelo with documents from the Amex case that were likely confidential. There were also indications that Ravelo might have leaked confidential MasterCard documents to Friedman.

The revelations provided ammunition to merchants who are actively opposing settlements in the swipe-fee cases—final approval of the Amex settlement remains pending, while the final approval granted to the $5.7 billion Visa and MasterCard deal is under appeal.

While many merchants may hope the Willkie discovery unravels the entire MasterCard and Visa settlement, Tuesday’s motion focuses solely on the fees Friedman was awarded out of the deal. Several merchants argue that Friedman’s adequacy as class counsel has now been thrown into doubt.

“Even if the settlement is upheld despite Mr. Friedman’s serious breach of fiduciary duty to the class and manifest conflict of interest, the law requires that Mr. Friedman forfeit any attorneys’ fees … and that those fees be paid back into the settlement fund,” the objecting merchants wrote in Tuesday’s motion.

Friedman didn’t immediately respond on Wednesday to a request for comment.

For more on this story go to: http://www.americanlawyer.com/id=1202732843144/DustUp-Over-ExWillkie-Partner-Roils-Megabucks-Credit-Card-Case#ixzz3grhlAYMd