Expansions

Deaths

Corrections or additions?

Life in the Fast Lane

These articles by Peter J. Mladineo and Barbara Fox were published

in U.S. 1 Newspaper on January 14, 1998. All rights reserved.

Like good lawyers everywhere Steven Picco and Michael

Herbert tried to put a positive spin on the news of the break-up of

their almost 10-year-old Trenton-based law firm, Picco Herbert Kennedy

PC.

Picco, who was taking a job with Reed, Smith, Shaw & McClay in

Forrestal

Village, told reporters that the partners’ "biggest problem was

that we started to bump into each other." Herbert, the municipal

attorney for Princeton Borough, was suing Mercer County in a waste

disposal case. Picco represented the county. Herbert was also recently

named municipal attorney for West Windsor Township, which was being

sued by developers represented by Hill Wallack, which had recently

hired partner Patrick Kennedy.

Herbert, who was leading a contingent of lawyers from the old firm

into plush new quarters in Princeton, told reporters that "we’ve

all done quite well for ourselves. We are going to places that will

give us the opportunity to practice law in our areas of interest."

Herbert’s new firm, Herbert, Van Ness, Cayci & Goodell, moved into

22 Chambers Street in the Borough just days before being officially

reappointed as Borough attorney — a coincidence that drew

favorable

applause at the Borough’s annual reorganization meeting.

The spin might have been too good. Shortly after the announcement

of the firm’s break-up, unsecured creditors of the firm received

letters

from a Somerville-based workout specialist, Hildebrandt Inc., asking

that they agree to settle their claims for 30 cents on the dollar.

The problem was that the firm had reportedly amassed $400,000 in

unsecured

debts (not large by legal standards), but because it was a

professional

corporation, it wasn’t permitted to dissolve until all of its

creditors

were satisfied. But the partners wanted to disperse immediately. They

didn’t want to stay in business long enough to earn the requisite

cash to pay off their creditors.

But the biggest problem of all for the cash-strapped lawyers was that

one of the accounts payable was $1,403.02 to the New Jersey Law

Journal.

The journal got the letter, agreed to a settlement of $429.01, and

then printed a front page story in its December 29 edition describing

the firm’s financial problems and work-out scheme.

Picco was unavailable for comment but his staff indicated that remarks

quoted in the Trenton newspapers were fairly accurate. "Let me

say that the consultants have used the common sense of Dilbert’s boss

and the subtlety of Genghis Khan. I’m sure this is a traditional,

hard-nosed routine to accumulate cash, but I would’ve done it

differently."

Herbert declined to return phone calls to his office. He was quoted

in the Trenton papers expressing anger at the Law Journal for

suggesting

that the partners in the firm were stiffing creditors instead of

digging

into their own pockets to pay their bills. "Each one of the six

principals took a considerable financial sacrifice to make payments

on the debts," he was quoted.

Picco and Herbert founded the environmental law firm in 1988 in

Trenton

and because of New Jersey’s onerous environmental regulations

industry,

the firm grew rapidly. By 1992 its staff increased from 6 to 26

attorneys

and the law firm absorbed Hartsough & Kenny. That year it also signed

a long-term, $2.94 million lease on Class A office space at 50 West

State Street in Trenton.

Picco Herbert Kennedy continued growing until 1995. But then, probably

as a result of Christie Whitman’s more business friendly regulations,

the number of environmental suits started dropping. That year

Hartsough

and Kenny left Picco Herbert to reconstitute their old firm at 3812

Quakerbridge Road, and the number of Picco Herbert attorneys decreased

to 18.

The firm’s latest twist seems to be a rare move indeed for a law firm.

"Frankly I’ve never heard of it," says Peter Forgosh, a

bankruptcy

and creditor’s rights attorney with the Morristown-based firm Pitney,

Hardin, Kipp & Szuch.

Arlene Sengstack, principal of AV Search Consulting, a

Bridgewater-based

legal recruiter, adds that "it’s not typical for law firms, but

law firms that dissolve, and there have been a lot in the last several

years, have to deal with their liabilities as well as their

assets."

She adds that Picco Herbert’s corporate status saved the partners

from bearing personal responsibility for their debts. "As a

corporation,

the individuals are protected by something of corporate veil,"

she says.

Will Picco Herbert’s offer work? If another area business’s experience

is any indication, the answer is probably not. In November Makrancy’s

Greenhouse and Florist Inc., sent a letter to its creditors to accept

a 15 percent take-it-or-leave-it settlement of debt (U.S. 1, November

26). The florist, which had run into trouble after the devastating

winters of 1994-’95 and 1995-’96, had arranged a deal with a financier

to loan the shop enough money to continue operation if it could get

75 percent of all of its creditors to accept a 15 percent payment.

It didn’t work.

Within a few days of sending the letter, Makrancy’s filed for

bankruptcy

protection. Joseph Markowitz, managing partner of the 3131 Princeton

Pike-based firm Markowitz & Zindler, feels that this method of debt

management usually never works. "Invariably you would get 80

percent

of the creditors — if they understood it. Then what happens is

20 percent don’t go along, and you have to go into court and bind

them. That’s where it always ends up."

In Picco Herbert’s defense, Sengstack explains that law firms are

frequently at the other side of the stick when it comes to unpaid

bills. "They’re just like any other business: they send out bills,

bills don’t get paid and they end up negotiating settlements as

well,"

she says. "They’re constantly finding themselves in positions

where they have to discount their time." How will Picco or Herbert

feel the next time a hard-up client asks them to take a fraction of

their fee?

Herbert, Van Hess, Cayci and Goodell, 22 Chambers

Street, Princeton 08542. Michael J. Herbert Sr., managing partner.

609-924-2495.

— Peter J. Mladineo

Top Of Page
Expansions

Art Wholesalers Ltd., 27 Route 31 South, Pennington

08534. Irene Bocchetti, vice president. 609-818-1500; fax,

609-818-9500.

The frame manufacturer doubled in size when it moved from 88 Youngs

Road in Mercerville to 34,650 square feet in Pennington last fall,

and it has a new phone and fax. Buschman Jackson Cross represented

the tenant and Hilton Realty is the landlord.

Meridian Emerging Markets Ltd., 3535 Quakerbridge

Road, Hamilton 08619. Victoria Gaudier, office manager. 609-584-5590;

fax, 609-584-5592. URL: http://www.memltd.com.

The information services provider expanded from 800 square feet at

14 Washington Road to 1,750 on Quakerbridge Road. It has 14 employees

now and expects to increase to 22. Based in Alexandria, Virginia,

it publishes an online newsletter about worldwide emerging markets

with real-time news, pricing, and research services. It compiles and

distributes fundamental financial information on publicly traded

emerging

markets companies.

Metro Service Group (MSG), 2650 Route 130 North,

Suite H, Constitution Center, Cranbury 08512. John J. Condon,

president.

609-395-7200; fax, 609-395-0805.

This organization has expanded and moved across the hall to 4,000

square feet. For A&P the five employees at this office provide

management

of sales, promotion, buying, and personnel.

Princeton Van Service, Industrial Road, Box 3094,

Princeton 08543-3094. Louis DeCibus, owner. 609-497-9600; fax,

609-497-1333.

Home page: http://www.princetonmoving.com.

The moving and storage firm opened an 8,000 foot secured facility

for short and long term storage on Industrial Road in Hamilton.

Primerica Financial Services, 2137 Route 33,

Lexington

Square Commons, Hamilton Square 08690. Hector Colon, district manager.

609-890-8400; fax, 609-586-8732. E-mail: torby@worldnet.att.net.

This division of Travelers Group moved from a smaller space in

Lexington

Commons. Owned by Richardson Financial Group, which is associated

with Richardson Realty, it has agents licensed to sell mutual funds.

Hector Colon is the district manager and Peter Ogden is one of the

personal financial advisers.

Saladin and the Princeton Energy Program, 116-301

Village Boulevard, Princeton 08540. Gary J. Fedor, senior vice

president.

609-520-9099; fax, 609-520-8457.

This software firm has nearly doubled its size and has moved to a

larger office, 10,000 square feet, in Forrestal Village. It now has

32 employees, and it develops software for the petroleum industry.

Princeton Optics Inc., 101 Walters Avenue, Ewing

08638. Barry Zhang, president. 609-771-4370; fax, 609-771-4371.

Home

page: http://www.princetonoptics.com.

The five-person fiber components company has bought a 3,400 square

foot industrial building two blocks from the College of New Jersey.

In its 18-page catalog are products from $100 to $3,000, typically

$500. They include fiber optic isolators and couplers and laser diodes

marketed to Princeton University, Sarnoff, NEC, and other research

firms, particularly those that develop telephone and cable television

systems.

Top Of Page
Deaths

Traci D. Williams, 22, on January 5. She was a computer

operator with Educational Testing Service.

Eileen E. Stanley, 55, on January 11. She was executive

director of Camp Fire Boys and Girls of Trenton.

Corrections or additions?


This page is published by PrincetonInfo.com

— the web site for U.S. 1 Newspaper in Princeton, New Jersey.

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