Personal injury lawyer suing Indy firm for allegedly withholding compensation

Editor’s note: This story has been updated with comments from Karres’ counsel.

An Indianapolis personal injury lawyer is suing her former firm, alleging she is owed money under a fee-sharing contract that is being withheld.

Katherine Karres, represented by lawyers with Norris Choplin Schroeder LLP, filed suit Friday against Hensley Legal Group P.C. She is seeking to recover money she says she is due for the time she invested in HLG clients before she was terminated.

Karres — who is now an attorney with Hurst Limontes in Indianapolis — practiced with Hensley Legal Group from May 2016 to May 2021.

According to the complaint, beginning in March 2019, Karres was compensated based solely on “fees generated from settlements or the payment of judgments.” Specifically, Karres alleges the firm agreed to pay her 15% of the attorney fees generated from cases to which she was assigned.

“The 15% fee sharing contract was compensation to Karres for the quality work she performed on cases that benefited the plaintiffs in their claims,” the complaint states. It continues, “The 15% fee sharing contract reflected the acceptance of risk by Karres in a successful result in the plaintiffs’ cases.”

Karres was terminated from HLG on May 14, 2021, and she was “locked … out of any access to files of clients with active matters upon which Karres was working at the time.” The complaint does not indicate why Karres was terminated, and her lawyer, Cynthia Lasher, declined to discuss that issue at this juncture of the case.

According to the complaint, Karres had an appearance on file for more than 50 cases in various stages of litigation and had invested more than 1,000 hours of work into those cases. Aside from the legal claims, Lasher said Karres’ case is a matter of public policy — employers must pay employees for the work they perform.

Additionally, HLG did not send a client election letter to those clients giving them the option of staying with HLG, moving with Karres or transferring their cases to another lawyer, according to the lawsuit. This went against guidelines from the American Bar Association, Karres argues.

In December 2019, the American Bar Association Standing Committee on Ethics and Professional Responsibility issued Formal Opinion 489, advising that client autonomy should be key when a lawyer chooses to leave one law firm for another. That opinion was based around Model Rule of Professional Conduct 5.6(a), which Indiana has adopted.

Karres alleges she asked HLG to send selection letters, but the firm refused. She also said HLG falsely told her clients that it did not have contact information for her when clients inquired about her.

“HLG has failed or refused to pay Karres for the time she has invested in Karres clients’ cases,” according to the complaint.

Karres’ complaint raises three counts: breach of contract if the fee-sharing agreement was valid; unjust enrichment if HLG denies the existence of the agreement or denies that it requires payment to Karres; or quantum meruit if a court determines the agreement was not valid. She is seeking judgment “in an as-yet undetermined amount to be proven at trial, interest, filing fees, costs, and … all other relief just and proper in the premises.”

The case — Katherine G. Karres v. Hensley Legal Group, PC, 49D01-2110-PL-034865 — has provisionally been filed in Marion County Commercial Court.

Online court records do not list an attorney for Hensley Legal Group. Indiana has reached out to founder and owner John Hensley for comment.

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