GALVESTON - Thornhill, Shrader & Burdette PLLC seeks a temporary restraining order from a local state district judge against partner Justin H. Shrader and attorney Craig Eiland of Galveston.

In a lawsuit filed Feb. 22 in Galveston County District Court, the Houston law firm alleges Shrader violated a co-counsel agreement by converting money from cash calls without permission. The plaintiff is asking Galveston County 212th District Court Judge Susan Criss to order the defendant to transfer the funds to TSB and cease payment to Eiland from Shrader's account.

According to the complaint, TSB executed a co-counsel agreement in early 2009 to pursue litigation on Hurricane Ike claims filed in Texas. An executive committee was formed and Schrader was tasked with fiduciary operations, which included payroll and other relevant expenditures.

Each party, however, was responsible of paying for their own operation expenses, the suit says.

Shrader's partners, Tom W. Thornhill and James W. Burdette II, in late October 2010 discovered on a spreadsheet sent with disbursement proceeds by Shrader's bookkeeper several unidentified unreimbursed expenses of about $5,000 each that had been withheld and paid to Shrader.

Shrader illicitly accumulated $76,000 on the plaintiff's dime, but claimed he held the funds for payroll purposes, according to the suit.

In response, the executive committee voted against the defendant keeping the money and stripped him of his fiscal duties. The committee decided that those proceeds had to be distributed immediately, and that any future request for funding staff expenses must be approved in advance, the suit states.

The plaintiff argues that Schrader "failed to distribute settlement funds or expenses to TSB or its other members in a timely manner" despite the vote, labeling his account "a mess."

TSB believes the defendant owes more than $500,000, the suit says.

In addition to the specified monetary damages, a jury trial is requested.

Spagnoletti & Co. is representing TSB.

  • Case No. 11-cv-0303

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