Crawford Lewis law firm accuses former employee of misusing client assets

A Baton Rouge law firm has obtained a temporary restraining order against a former employee the firm accuses of misusing or misappropriating millions of dollars in state film tax credits and other client assets.

The law firm, Crawford Lewis PLLC, obtained the restraining order Monday from 19th Judicial District Judge R. Michael Caldwell, according to the date above the judge’s signature.

Caldwell scheduled a hearing in the case for May 9 and barred James M. “Tres” Bernhard III, the former Crawford Lewis employee, from negotiating or settling any claims involving the law firm’s clients.

Bernhard, who is an attorney and the son of Shaw Group Inc. Chairman Jim Bernhard, also was ordered by Caldwell not to destroy or otherwise dispose of any records related to the dispute with Crawford Lewis.

No estimate of total client losses is contained in the civil suit.

“It is a substantial amount of money, and it is in seven figures,” said Mary Olive Pierson, who filed the suit on behalf of Crawford Lewis.

Pierson added, “My client and I are doing everything we can to identify the problems and victims and make restitution where necessary.”

Tres Bernhard could not be located for comment Tuesday. A call to his father’s office was not returned.

Christine Lipsey, one of Tres Bernhard’s attorneys, declined to comment on the civil suit or issue a statement on her client’s behalf.

“We’re reviewing the allegations right now,” Lipsey said. “That’s as far as we’ve gotten.”

According to the civil suit, Bernhard admitted on March 22 that he had fabricated a disputed $600,000 check and was fired the same day.

Bernhard now is at “an undisclosed medical facility in Texas,” the suit alleges.

According to the website for the Louisiana State Bar Association, Bernhard has been licensed to practice law in this state since October 2003.

Crawford Lewis said in its suit that Bernhard began working for the firm in October 2007 in an “of counsel” position. That meant he had free use of the law firm’s equipment and facilities and received compensation based on work generated for Crawford Lewis, the suit alleges.

The law firm also is suing seven companies it alleges are controlled by Bernhard. They include LUS Consulting LLC, Entertainment Capital Partners LLC, Bernhard & Associates LLC, JMB Ventures LLC, L.I.F.T. Digital Media LLC, Arms Consulting LLC and Orleans Studios LLC.

When one client deposited $1.3 million into the Crawford Lewis trust account to settle claims against that client, the law firm alleges, Bernhard “caused a substantial amount of the funds … to be diverted to a number of his personal creditors and to LUS.”

After Bernhard was fired in March, Crawford Lewis alleges in its suit, the firm discovered a series of schemes in which Bernhard had “misappropriated or misdirected money or rights to tax credits.”

Bernhard also had “sold invalid tax credits to third parties,” the suit alleges. Crawford Lewis also alleges Bernhard “satisfied personal debts through the misappropriation of client and firm funds.”

Because of Bernhard’s actions, Crawford Lewis alleges, the law firm may be sued by clients and third parties.

“All efforts to get Tres to put up any money, which is what it will take to satisfy these potential claims, have fallen on deaf ears,” the law firm alleges.

“While in the undisclosed medical facility in Texas, Tres has hired the services of at least four lawyers — two from Dallas who introduced themselves as criminal defense lawyers,” Crawford Lewis says in its suit.

According to the suit, Bernhard also has hired two lawyers in Baton Rouge, “one being a civil litigator and one being an attorney for disciplinary matters.”