Jury Finds No Malpractice by NY Law Firm in Patriot National Downfall

August 7, 2026 by William Rabb

A Broward County jury on Thursday exonerated the Simpson Thacher & Bartlett law firm, finding the large New York firm’s lawyers were not negligent in the downfall of Patriot National, the Florida insurance services firm that went bankrupt a decade ago.

It’s too early to say if Patriot National owner Steven Mariano will appeal the verdict, said Bill Scherer, his lead attorney in the case.

“We’re looking at our options. I don’t have many cases that don’t end up in the appellate court, but we’ll see,” Scherer told Insurance Journal Friday morning. “We felt there was plenty of evidence to show that the firm had let him down, had let Mr. Mariano’s companies down, but the jury didn’t see it that way.”

Mariano is the high-profile Fort Lauderdale entrepreneur who also owned Guarantee Insurance Co., a workers’ compensation insurer that famously was declared insolvent in 2017. A few months later, Patriot National, whose main client was Guarantee Insurance, filed for Chapter 11 bankruptcy protection, just a few years after Mariano had hired Simpson Thacher attorneys to help take the company public.

Mariano quickly blamed his lawyers and others for a botched initial public offering and private investment in public entity (PIPE) transaction that sent Patriot’s stock price to the floor. He filed a professional malpractice suit against the white-shoe Simpson Thacher law firm in 2017, alleging the lawyers failed to protect Patriot from predatory hedge fund investors.

After years of delays, on July 14 the suit finally went to trial, a rarity in legal malpractice claims, which often settle, Law360 reported. Simpson Thacher’s trial attorneys, with the Stearns Weaver Miller and the Williams & Connolly firms, told a different story at the three-week trial, arguing that Mariano was desperate for cash, was millions of dollars in debt, and was fully warned about the dangers of certain financial arrangements.

“The evidence has proven that (Simpson Thacher attorneys) Gary Horowitz and Lesley Peng did their job. They identified the issues,” defendants’ lawyer Robert Cary said, according to Law360, which covered the trial. “Here’s an email warning Mr. Mariano that ‘the (stock) price could go down to a penny, and then you have a huge issuance of stock.’ (It was) clear as a bell, one of the clearest warnings one could ever imagine.”

The narrative presented by Mariano’s lawyers was not enough to convince a jury to find malpractice. Scherer declined to say if his team has identified anything from the trial that could be potential grounds for an appellate review. But he noted that the jury was paying attention throughout the trial. The judge commented at one point that jurors were on time every morning, something that is not always the case.

And the jurors seemed to grasp the intricacies of PIPE transactions, complex financial arrangements that involve selling restricted stock directly to institutional investors, the lawyer noted.

“Yes, my goodness, they are horribly complex,” Scherer said about the transactions. “Of course, that was the root of this whole case, the complexity of it. But again, the jury saw it and must have understood what was going on. They rendered their decision.”

Scherer said Mariano is disappointed in the outcome, especially after a decade of litigation. He declined to say what business interests Mariano is involved in now.

“This whole thing wiped out his companies, but he’s a fighter and a good businessman,” the lawyer said. “You can’t keep those people down.”

Scherer said the case, despite the outcome so far, has renewed his faith in the jury system, at least in Broward County.

“I respect the jury’s verdict but believe the facts warranted a different outcome,” he said.

Simpson attorneys could not immediately be reached for comment Friday morning.

The Patriot National/Guarantee Insurance saga had captivated people in Florida’s workers’ compensation and property-casualty insurance arena for years, before and after the insolvency, partly because Florida insurance regulators in 2017 blamed Mariano for diverting more than $15 million and using the funds for “no discernible business purpose.” Mariano has disputed that.

News reports and lawsuits at the time also raised questions about the entrepreneur’s purchase of a multi-million-dollar mansion, a condominium and a yacht in south Florida.