Wittenberg University has dropped a lawsuit against its former law firm in a dispute over real estate transactions the school had argued damaged its finances.
The university had been in a legal dispute with Springfield law firm Martin, Browne, Hull and Harper since February 2015, saying the firm provided poor legal advice and created a conflict of interest. That led to real estate transactions that damaged Wittenberg’s finances, the suit says, including the purchase of the building that houses the Springfield Museum of Art.
But documents filed in Clark County Common Pleas Court show Wittenberg recently voluntarily dismissed those claims.
Wittenberg leaders said they still believe their arguments have merit and reserve the right to re-file at a later date.
“Our decision to proceed in dismissing the case without prejudice at this point is being made in light of the existing court case management schedule that we simply cannot meet at this time,” said Richard Helton, interim president at Wittenberg. “We remain confident in our claims and are focusing our energy and efforts on getting the case resolved. If we are unable to resolve the case in the upcoming months, we will re-file our complaint with the court.”
Attorneys representing Martin Browne said in a statement that the firm represented Wittenberg for more than 30 years and has been vindicated by the dismissal.
“The firm’s position from the outset of this litigation has been that the claims in the lawsuit were unfounded and that, in due course, the matter would be resolved in the firm’s favor,” the statement says. “Martin Browne is pleased that the university’s board of directors has chosen to voluntarily dismiss all claims asserted in the lawsuit.”
The law firm hasn’t filed any counter claims against Wittenberg related to the dispute, according to court records.
“Wittenberg is an important part of the community in which we practice and live, and the firm wishes only the best for its future,” Martin Browne’s statement says.
Attorneys for the law firm had previously argued portions of the case should be dismissed because the statute of limitations on the case ran out years ago. But a judge ruled late last summer that the case could move forward.
Court records show a motion to extend the deadline for the case was filed in mid-April, and then the complaint was dismissed later that month.
Among its claims, Wittenberg had argued:
• The law firm used its position to benefit other clients and steer more business toward itself.
• The firm drafted an investment policy in 2010 that prohibited borrowing from the endowment without specific board approval and set withdrawal limits. Despite that prohibition, the lawyers advised that a multimillion dollar loan to the university from its endowment was appropriate.
• The lawyers excluded real estate purchases from the endowment’s withdrawal limits, and permitted a real estate subcommittee on the board of trustees to acquire and dispose of off-campus real estate up to $150,000.
The law firm responded in court documents last summer, arguing the university’s board members knew what they were getting into when Wittenberg purchased the Springfield Museum of Art in 2010.
Despite that knowledge, the university moved forward with the transaction, Martin Browne’s filings say.
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