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Depositions coming soon in bitter Cellino and Barnes breakup

They still appear together on dozens of TV advertisements every day, urging people who have been injured in car accidents or other calamities to hire their law firm to sue the responsible parties, hopefully for millions of dollars.

Ross M. Cellino Jr. and Stephen E. Barnes still work together, running a Buffalo-based personal injury law firm that has 250 employees, more than 10,000 clients and more than 3,000 lawsuits.

But in State Supreme Court, they continue to bicker and battle over a legal action filed by Cellino more than 13 months ago, seeking to dissolve the high-profile Cellino & Barnes.

As they prepare for a non-jury hearing scheduled to begin Dec. 4 on Cellino's request before Judge Deborah A. Chimes, both attorneys are also getting ready for what could be a long and grueling experience in pretrial depositions.

Sometime within the next four to six weeks, Cellino is expected to be deposed by Barnes' lead attorney, Paul J. Cambria, and Barnes is scheduled to be deposed by Cellino's lead attorney, Terrence M. Connors. Cambria and Connors, two courtroom bulldogs who have been practicing in Buffalo for more than four decades, are widely considered two of the region's toughest inquisitors.

"Depositions are the next step," Cambria told The Buffalo News on Friday. "I'll be fully prepared for it, and I expect that Mr. Connors will be, too."

Connors said he too is preparing for the depositions.

The pretrial depositions – which are conducted in a law office, outside public view – could be very interesting because of the acrimony of the dispute, the high profile of Cellino & Barnes,  and the top-notch attorneys involved, observed Thomas "Tim" Franczyk, a retired Erie County Court judge who now teaches at the University at Buffalo Law School.

"I'd like to be a fly on that wall," said Franczyk. "Pretrial depositions are important in any case, but they could be critically important in this one. What comes out in the deposition testimony will give the attorneys on both sides ammunition they can use at the hearing. Deposition testimony can also be used to impeach a witness, or to bring out some substantive information that the attorney wants to get on the record."

Some pretrial depositions can last less than an hour and be boring affairs, according to local attorneys. Some depositions take hours, even days, and get quite testy.

There have already been some testy moments in Chimes' downtown Buffalo courtroom since May 2017, when Cellino shocked many in the legal community by filing court papers seeking to break up the law firm. Cellino said he has had numerous philosophical and financial disagreements with Barnes in recent years and can no longer work with him. He asked Chimes to break up the firm, which would allow Cellino to start his own.

Cellino accused Barnes of financial improprieties – which Barnes vehemently denied – and he said he is unhappy with the firm’s business practices, including the alleged practice of stealing clients from other local law firms. “For three difficult years, I tried to voice my concerns about changes that would improve our firm,” Cellino told The News last year. “My efforts were rebuffed, and my ideas were rejected. We are at a deadlock. It is time for us to go our separate ways."

Barnes disagreed, saying he and Cellino could still work out any differences. Barnes said breaking up the law firm would be unfair and hurtful to hundreds of employees and thousands of clients. Over a period of 25 years, Barnes said, he and Cellino spent $100 million on marketing and advertising to establish their brand.

During a court proceeding last December, Cambria said both Cellino and Barnes – the firm's only two stockholders – each make $1 million a month, far more than almost any attorney in Western New York history.

For Cellino, the dispute has never been about money, Connors responded. "For him, it is the deadlock on the management philosophy of the firm,” Connors said.

In September, the firm's operations in California were split off from Cellino & Barnes. Now, the California practice is known as The Barnes Firm and is run entirely by Barnes.

At Cellino's request, Chimes in January appointed Buffalo attorney John G. Schmidt Jr., a partner in the Phillips Lytle law firm, to be a temporary receiver in the case, overseeing any disputed financial dealings between The Barnes Firm and Cellino & Barnes. On Thursday, at Schmidt's request, Chimes gave Schmidt permission to hire an attorney from his law firm and an accounting firm to help him further investigate the firm's finances.

Barnes' attorneys recently filed an appeal of an order issued by Chimes in February, in which Chimes refused to dismiss Cellino's lawsuit and refused to grant summary judgement in Barnes' favor.

Despite all the disagreement and controversy of the past 13 months, managing attorney Robert J. Schreck – a Barnes ally – said his two bosses have managed to "do a very good job of running this firm and continuing to serve our clients."

"The dissolution matter proceeds in court, but we in the firm continue to conduct business as usual," Schreck said on Friday. "We're on our way to a record year in terms of profits for the firm and verdicts and settlements for our clients."

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