Bet the House: Reid Collins Bets Big on its Four Aces

From left, Greg Schwegmann, Craig Boneau, Joshua Bruckerhoff, Nate Palmer. Photos by Laura Crosta.

When it comes to high-stakes financial litigation, Reid Collins has not just one ace up its sleeve, but four: Josh Bruckerhoff, Craig Boneau, Nate Palmer and Greg Schwegmann. The Assassin. The Coach. The Pitcher. The Mathematician. These partners may be the most successful young trial corps in law practice today.

Reid Collins has ascended to the top ranks of America’s most successful financial plaintiff firms in no time flat. In its 12th year, the firm has achieved billions in verdicts and settlements with a compact crew of lawyers anchored in Austin, Dallas, New York, Washington, D.C. and recently Wilmington, Del.

The firm’s name partners – Bill Reid, Jason Collins and Lisa Tsai – laid the foundation for the firm’s success. But the firm’s national ascendance also is due to the hard work and success of its Four Aces.

Well uh beat the drum, and hold the phone, the sun came out today. We’re born again there’s new grass on the field.

A $300M lawsuit, now settled, against Brown Rudnick accusing it of bungling litigation over the leveraged buyout of Lyondell Chemical Company. A $20M settlement for dealmaker Sarah Bradley against her former colleagues at Kainos Capital. An against-the-odds win at the U.S. Supreme Court in Merit Management v. FTI creating new safe-harbor bankruptcy law. A recently upheld derivative claim against Renren insiders implicating billions in connection with SoFi and SoftBank. A $1B trial set for May against Celtic for defaulting on debt to Highland Capital, and – never a dull moment – Reid Collins had a jury verdict for fraud in its decade-long case against Credit Suisse upheld by the Texas Supreme Court last year in one of the few financial crisis cases to reach a jury verdict

The Aces are the beating heart of the firm’s success. Bruckerhoff, Boneau and Palmer threw in with the founding members of Reid Collins fresh out of law school. And, once Schwegmann left Big Law practice in New York behind, they joined forces on the ground floor of Reid Collins when that firm began just 12 years back. Over the years they have galvanized as a tactical team that takes a knotted-up problem and ferrets out the tiniest bit of string to follow through a forest obscura to find answers and accountability for some of the world’s biggest frauds.

They bring together a rare combination of skills honed in battle and forged by necessity of putting food on the table at a new firm. They are hyper competitive, yet thoughtful. Contemplative, but calculating. The same, but different in a rare law firm environment that prizes individuals and gives them room to succeed on their terms.

It’s been that way since they set up shop in a suburban office park in Austin on an old door laid over banker’s boxes foraging files rejected by other law firms. “If we hadn’t done that, then we wouldn’t have had any cases to work on,” says Boneau, the Coach, whose amiable nature pulls together the other three. “Out of necessity, we had cases that nobody wanted and didn’t, on the face of it, even look like cases.”

“Saying, ‘This doesn’t work,’ wasn’t an answer we could ever give,” says Schwegmann, the Mathematician. “It doesn’t add any value. I need the solution. Because we’re here to generate recoveries for our clients and, in the end, make money.” Solutions to these difficult cases are what Bruckerhoff, Boneau, Palmer and Schwegmann unraveled. And, although the Reid Collins’ cases have gotten bigger and better over the years, these litigation aces are still finding innovative ways to win for their clients and make money in the process.

The firm works on contingency in taking on financial frauds. That puts the premium on the analysis and legwork to take the string and follow it not just to an impressive legal theory you can tie in a bow – but also then to wrap around a core, cover it in cowhide and throw 100 mph fastballs at a culpable wrongdoer with financial resources.

Firm founder Reid has more than a little to do with the team’s success. A turbo-charged legal warrior, he relishes a good fight, going up against great adversaries and making money. But despite his new role as law professor, he makes no claim on being able to trace the roots of fraudulent transfer law back to the Justinian Code.

“I’m only as good as the ideas the people on our team can come up with. I don’t have the bandwidth or the brains, in a lot of cases, to actually come up with these ideas myself,” says Reid.

“I think I’m a little like Ronald Reagan in the sense that I have an unbelievable cabinet,” he adds.

A-roundin’ third, I’m headed for home. It’s a brown-eyed handsome man. Anyone can understand the way I feel.

Front and center in discussions of the Four Aces is Bruckerhoff. Quiet and thoughtful, the Assassin brings a unique ability to scope out the main issue in a case, then find the pathway to resolve it. He has played the role of sniper in many of the firm’s most vaunted wins, including many with international intrigue, which it can’t disclose. Bear Stearns, Lyondell Chemical, Doral Financial, ICP Strategic Credit Income Fund, AJW Master Fund, and Merit.

He is the master of not only unraveling complex cases but also finding the right pressure points for defendants to compel them to settle, often before any public lawsuit is filed. Bruckerhoff has settled more than half of the cases he has handled before actual litigation. His ability to take down defendants quick and stealthy is one of the reasons Reid has dubbed him the Assassin. (Meeting Bruckerhoff in person, he is one of the friendliest and most down-to-earth folks around. Except that long, unrelenting stare. Assassin giveaway.)

But not everyone settles in advance, as is evident from some of the recent high-dollar cases that Bruckerhoff has handled. Referencing one of those cases, Reid explained: “I gave the case to Josh with low expectations he was going to find anything. Josh figured all this out, literally, in a matter of three or four days.

“I’m pretty good at identifying the best idea in the room,” Reid says, “and it’s disproportionately the case that the ‘Eureka’ moment or a brilliant idea will come from Josh.”

Bruckerhoff is Midwest through and through, from Columbia, Mo.; he remembers watching the O.J. trial and reading John Grisham books growing up. While he always had an interest in the law, what he really enjoyed was anything that allowed him to use his analytical skills. He brings that same inquiring mind and love for unraveling issues to his work at Reid Collins. “My ability to look at problems from different angles and find solutions probably just comes down to my stubbornness,” he says. “I approach each problem in my cases from the perspective that there has to be a solution to it.”

Reid now uses many of Bruckerhoff’s “brilliant ideas” when teaching his students at the University of Texas School of Law. For instance, several years ago, Reid Collins was given a potential legal malpractice case that appeared dead in the water on limitations grounds. Bruckerhoff, however, figured out a creative solution to the problem—what his firm now internally refers to as the “D.C. heist.” Although nothing about the case concerned Washington, D.C., Bruckerhoff found that the lawsuit could be filed there because Washington, D.C. has a longer statute of limitations and a rule that a defendant cannot seek dismissal on forum non-conveniens grounds without agreeing to waive all statute of limitations defenses. Reid Collins threatened to bring the lawsuit in D.C., and the defendant, not wanting to litigate in an otherwise inconvenient forum, agreed to waive its statute of limitations defense before the case was even filed.

“Each case presents a different puzzle to solve, particularly when we are assessing why a company collapsed,” Bruckerhoff says. “Given the complexity of a lot of our cases, we often have the opportunity to think outside of the box, and to try new or creative strategies. Some of my and the firm’s notable successes were achieved after other lawyers told our clients they had no claims.”

You know I spent some time in the Mudville Nine. Watchin’ it from the bench. You know I took some lumps when the Mighty Casey struck out.

Boneau grew up as a “latchkey kid” in a trailer park in Southeast Texas. By the age of 8, he was pretty much taking care of himself, making his meals, doing his homework and playing ball.

In high school, his basketball coach had a particularly strong influence, and was the first person who really pushed Boneau, with very high expectations for the team’s effort and attention to detail.

“He approached basketball as a tool to teach us how to work hard at something and understand that if you put the effort in every day, the rewards will come,” says Boneau. “But he also made it very clear that you can’t just show up and expect someone to give you something. And, because we were part of a team, he was very big on teaching us to support each other and pick each other up when one of us was struggling. He helped us understand that we were all much stronger when we worked together and for each other.” Boneau has applied those lessons to his practice of law.

Recently, Boneau led the team in pursuit of claims for Sarah Bradley, who claimed her membership in a private equity firm, Kainos Capital, was stolen from her. Boneau’s team figured out the scheme Bradley’s former partners employed to steal her interest and keep her in the dark. They put together the litigation strategy that led to a $20M settlement of Bradley’s claims. According to Boneau, “the Bradley case is another great example of teamwork. When Sarah came to us, it was clear she had lost something of value, but what wasn’t clear was how it happened and how to make a claim out of it. But we got to work and figured it out as a group with one idea leading to another. It is so much fun to watch that happen.

“When no one is worried about taking credit, there is no resentment about one person refining another person’s idea into something better. That’s the type of environment I want to create because I think that makes us much more likely to succeed and it makes playing this game a lot more fun for everyone. And, in Sarah’s case, it led to a fantastic result,” he says.

Heaven help the foe on whom the Assassin and the Coach team up, as they regularly do. When Reid Collins filed suit against Reed Smith for blowing a statute of limitations, they asserted a $500M claim, thanks to the Assassin’s fondness for tracing claims through old English law and the Coach’s extensive knowledge of residential mortgage-backed securities claims. The case settled prior to the completion of motion to dismiss briefing.

Boneau is a natural leader, Reid says: “He runs teams very well; he gets them. He’s a very good group thinker.” So much so that in Reid’s first role as litigation trustee, in the Brooks Brothers case, he chose the Coach as his lead counsel to run the investigation.

So say hey Willie, tell Ty Cobb and Joe DiMaggio. Don’t say it ain’t so. You know the time is now.

It doesn’t get much bigger than the team’s U.S. Supreme Court victory in Merit Management Group LP v. FTI Consulting Inc., anchored by Bruckerhoff and, of course, the Mathematician. Schwegmann studied formal logic and reasoning as an undergrad, providing the framework to evaluate and simplify fact patterns and complex legal arguments. A stint in Tanzania in the Peace Corps after graduation added perspective, as well as improvisation and the opportunity to hone problem-solving skills.

“On a surface level, having a degree in mathematics – even theoretical mathematics – also comes with a certain level of comfort with numbers that a lot of lawyers lack, which can be useful in evaluating damages in tricky cases and in interrogating financial experts to either pick their work apart or make their opinion stronger,” says Schwegmann, who recently snagged a vast bonus for a case he brought in and successfully settled against a multi-billion financial firm before filing. In typical Reid Collins fashion, Schwegmann saw solutions where other firms only saw problems and devised creative legal arguments to create the risks necessary to generate the result.

Reid Collins secured one of its biggest legal achievements through its representation of FTI, as the litigation trustee that held the claims of a bankrupt planned “racino” – a racetrack and casino, at Valley View Downs in Pennsylvania. In 2007, Valley View Downs agreed to buy out the shareholders of Bedford Downs, among them Merit Management, for $55M if it succeeded in acquiring the last harness-racing license in Pennsylvania. They won the license, but the project, and Valley View Downs collapsed in bankruptcy, eventually leaving FTI to pursue the claims to void the $55M payout on behalf of creditors.

Merit, naturally, wanted to keep the $16.5M it got in the deal, and thought Bankruptcy Code section 546(e)’s safe-harbor was a silver bullet that would put a quick end to FTI’s claim. Merit claimed the safe-harbor protected transfers made to purchase stock that passed through a bank from avoidance, including in this case – in which the transfer passed through both Credit Suisse and Citizens Bank. And at least five different federal circuit courts – all but one of the appellate courts that had addressed the issue – agreed with the firm’s opponent.

Bruckerhoff and Schwegmann searched for grounds to buck the trend of circuit courts expanding the scope of the safe-harbor and identified the 7th Circuit as their best chance for success. They brought the case in Illinois with an eye toward getting the 7th Circuit to weigh in on the issue. When the case inevitably arrived there, Schwegmann underscored the harbor’s limits with a commonsense argument about a Christmas card to grandma:

“If I put a Christmas card in the mail to my grandmother and the postman delivers it, who was the card sent by? If Merit is right, we’d have to conclude that the card was sent not by me, but the postman. But, that’s ridiculous, and that is not what Congress meant when it protected transfers that were made by a financial institution,” he argued.

They won 3-0 in the 7th Circuit with Schwegmann at the podium. It was the first time in 30 years that any plaintiff had successfully contested a 546(e) safe harbor claim, creating a true split among circuits. The U.S. Supreme Court, which seeks to keep federal standards uniform nationwide, heard the case and in February 2018, FTI and Reid Collins won “nine-nothing on arguments that Greg and Josh wrote,” Reid says.

Determining whether the 546(e) safe harbor protected Merit’s payout from cancellation required looking “to the overarching transfer from Valley View to Merit,” Justice Sonia Sotomayor wrote, and not the banks through which the transfer passed.

“Winning the 546(e) in the 7th Circuit and getting the Supreme Court to affirm is what people know about and rightfully, I think, put a spotlight on our firm. And Josh and I definitely spent a lot of time thinking about the argument and the best way to make it over the years,” says Schwegmann. “But, the piece that often gets missed, and that is at least equally impressive, is the strategy we developed and set in motion at the very outset of our representation that was designed, and eventually led to that incredible outcome. I think it speaks to our team’s creativity and willingness to take risks and break from conventional wisdom when the situation calls for it, and it’s a great example of maximizing value to the client through creative legal strategy.”

The Merit ruling may prove a catalyst for a lucrative area of practice, Reid says, “with literally billions of dollars in claims subject to 546(e),” and the possibility of a flood of cases in the aftermath of the coronavirus pandemic and the resulting economic turmoil.

Got a beat-up glove, a homemade bat and brand-new pair of shoes. You know I think it’s time to give this game a ride.

And then there is the Pitcher. Starting at least by the age of four, Palmer was throwing a baseball. His dad had been a catcher and he doesn’t remember a time he wasn’t playing baseball. Growing up as a Texas Rangers fan, his dream was to be Nolan Ryan.

But early on, he wasn’t the obvious talent on the field. And around the time he was 10-years old, he was struggling on the mound. His dad was the coach and walked out to the mound. “He said something like, ‘I don’t think you should be a pitcher,’ and moved me to first base.’”

His dad knew that he could tap into his son’s stubborn streak. “If you tell me I can’t do something, then I’m going to do it. I wasn’t the most talented baseball player. But I could outwork – and was willing to outwork – anyone. So I just worked at the craft. I showed up early, stayed late, and worked.” He got older, and stronger and the work paid off. He became a pitcher.

He continued that passion on the mound for the Wheaton Thunder, where he amassed an impressive record. When he was pitching, he owned the ballpark.

Which is just how he liked it. He thrived in the one-on-one battle that exists between pitcher and hitter. And the mind game. Throw high and tight to back a hitter off the plate, and then a breaking ball low and away or a sinker low and in. And while he didn’t top 100 mph, he came close.

The competitive part of practicing law resembles how he pitched. “Not liking to lose, that’s definitely there. I like high pressure situations, like being in the courtroom for an oral argument. There’s a similar controlled aggression that’s at play, although not quite like my days on the mound. You can’t exactly throw high and tight in the legal world,” he says. “But I do think there are similarities. Your mental state when you’re called in from the bullpen is similar to oral argument or trial.

“Bill’s a great example. You have to walk in confidently, like you are in complete control. Then you have that presence, you have that ability to argue and think and listen and respond,” the Pitcher explains.

The courtroom is now Palmer’s field of dreams. He recently played a key role in cementing one of the firm’s signature victories, taking on Credit Suisse for its role inflating valuations of Lake Las Vegas properties and ultimately – in a rare feat - helping to secure a jury verdict for fraud, which was upheld in the Texas Supreme Court last year.

Palmer’s currently on the mound for Reid Collins in the $500M In re: Renren Inc. Derivative Action, centered around a company that once had designs on – and raised money to become – the Facebook of China.

The company failed to live up to its ambitions, however, and millions of dollars left over from its initial public offering were deployed throughout 45 portfolio companies.

What happened next, Palmer alleges in a New York state court lawsuit, was that Renren’s most valuable assets – including a stake in lender Social Finance Inc. or SoFi – were transferred through a sham spinoff to Oak Pacific Investments, a vehicle controlled by Renren CEO Joseph Chen and insiders including affiliates of SoftBank.

For the lawsuit to fly, Reid’s aces once again needed to find U.S. jurisdiction – a nifty trick given that Renren is based in China and incorporated in the Cayman Islands (a jurisdiction of particular expertise for Reid Collins).

“Nate did what he always does, which was to outwork his opponents, scouring the public filings and other publicly available information to connect the transaction to New York and thereby establishing jurisdiction,” says Reid. “Others – including notable law firms – had abandoned any hope of establishing jurisdiction, until they saw Nate’s analysis in the filed complaint. Then, everyone joined in and several other law firms intervened in the suit,” says Reid.

Just to hit the ball and touch ‘em all. A moment in the sun.

How each of the Aces has capitalized on their individual strengths is all the more impressive considering they are all in their late 30s or early 40s.

“They are figuring out some of the most complicated cases I’ve ever seen in my life, and not just figuring them out – figuring out ways to win them against some of the best firms in the country,” Reid says.

For the Aces, it’s all about the team. “Every innovative idea is a product of my work with the amazing team of lawyers we have. In fact, I’d say that my favorite part of work every day is getting to brainstorm issues with our team,” says Bruckerhoff. “Many of the firm’s successes came from doing things that have never been done before. When that is the case, it certainly helps to have a group of other creative attorneys who are willing to take risks.”

Teaching the next generation their skill set and appetite for risk will be the next test of leadership for this group – one that may be as dicey a proposition as acquiring it in the first place.

“As Nate says, it’s the hardest thing to do but it’s also rewarding to be able to say, ‘No, you just told me a problem. Go back and find me a solution,’” Schwegmann says.

What makes the task tougher for those who would follow the Aces is that neither the odds nor the risks of failure are as high. The firm is turning 12 and is now known nationally for its abundant success and fearless trial techniques, which has led to better quality cases.

“Given where we started as a team and as a firm, it’s exciting to see that the work has paid off and we have arrived at the next level,” Schwegmann says.

The firm can now be a bit choosier, “and we have cases that are more likely to be, on their faces, pretty good cases. I don’t know that our young people get the same challenge,” Boneau says.

The power of the Assassin, the Coach, the Pitcher and the Mathematician is also in a shared experience where building something together eclipsed individual aspiration. While each can detail their aha moments in their cases, at the end of the day, there is a tremendous amount of pride in what they, Reid and the firm have done together.

“I honestly don’t remember in most cases whose idea it was,” says Boneau. “It could have been my idea, but it could have been somebody else’s idea because it was such a group-think thing. Even if there’s one person that ultimately will make the final call and solve the problem, that person will have effectively stood on the shoulders of giants, because there’s never an idea that is completely out of the blue, it is always a product of teamwork.”

For The Four Aces, that giant is first and foremost Reid, whom they credit for trusting his partners with the freedom to let it rip when the right one crosses the plate.

“For Josh, that means something different than it means for me,” Boneau explains. “And it’s different for Nate and different for Greg. But at the end of the day, it means the same thing, which is we’re all more effective at creating success for our clients because we get to do it in a way that is a good fit for each of us. And it also makes it far more enjoyable because we’re able to practice law in a way that we love.”

It’s a gone. And you can tell that one goodbye...

About the author: Katrina Dewey (katrina@lawdragon.com) is the founder and CEO of Lawdragon, which she and her partners created as the new media company for the world’s lawyers. She has written about lawyers and legal affairs for 30 years, and is a noted legal editor, creator of numerous lawyer recognition guides and expert on lawyer branding. She is based in Venice, Calif., and New York. She is also the founder of Lawdragon Campus, which covers law students and law schools. View our staff page.