Stroock, Stroock & Lavan LLP v. Dorf, 021710 NCSUP, 08 CVS 14248

Docket Nº:08 CVS 14248
Opinion Judge:JOLLY, JUDGE.
Party Name:STROOCK, STROOCK & LAVAN LLP, Plaintiff v. ROBERT DORF, Defendant
Attorney:Brooks, Pierce, McLendon, Humphrey & Leonard, LLC by Charles F. Marshall, Esq. for Plaintiff. Ellis & Winters, LLP by Jeffrey M. Young, Esq. and the Law Office of James C. White by James C. White, Esq. for Defendant.
Case Date:February 17, 2010
Court:Superior Courts of Law and Equity of North Carolina




ROBERT DORF, Defendant

No. 08 CVS 14248

Superior Court of North Carolina, Wake

February 17, 2010

Brooks, Pierce, McLendon, Humphrey & Leonard, LLC by Charles F. Marshall, Esq. for Plaintiff.

Ellis & Winters, LLP by Jeffrey M. Young, Esq. and the Law Office of James C. White by James C. White, Esq. for Defendant.



PURSUANT to the inherent powers of the court and the provisions of Rule 60, North Carolina Rules of Civil Procedure, and upon the initiative of the undersigned, in order to correct clerical omissions arising from oversight, that Order and Opinion filed in this matter and dated February 16, 2010, hereby is RESCINDED and WITHDRAWN. This Revised Order and Opinion, adding new paragraphs 39 and 40, is substituted in its place.

THIS CAUSE, designated a complex business case by Order of the Chief Justice of the North Carolina Supreme Court, pursuant to N.C. Gen. Stat. § 7A-45.4(b), and assigned to the undersigned Special Superior Court Judge for Complex Business Cases, by order of the Chief Special Superior Court Judge for Complex Business Cases, is before the court upon the Defendant's Motion to Dismiss, pursuant to Rule 12(b)(6), North Carolina Rules of Civil Procedure ("Rule(s)"); and

After considering the arguments, briefs, other submissions of counsel and appropriate matters of record, as discussed infra, the court CONCLUDES that with respect to the Plaintiffs Claim for Relief ("Claim") alleged in the Application to Confirm

Arbitration Award against Robert Dorf ("Application"), the Defendant's Motion to Dismiss should be GRANTED.


[1] Plaintiff Stroock, Stroock and Lavan LLP ("Stroock") is a national law firm with an office located in the County of Los Angeles, California.1

[2] Defendant Robert Dorf ("Dorf") is a citizen and resident of Wake County, North Carolina.


[3] On August 14, 2008, Stroock filed the Application in Wake County. It was verified by S.V. Stuart Johnson, of Stroock. In its Application, Stroock seeks to have the court (a) confirm an arbitration award against Dorf personally; (b) enter judgment against Dorf in the amount of $393, 423, plus interest as set forth in the arbitration award and (c) tax the costs of this action, including reasonable attorneys' fees, to Dorf.

[4] On October 15, 2008, Dorf filed his Motion to Dismiss the Application (the "Motion"). In his Motion, Dorf prays that the court dismiss the action and tax the costs of this litigation to Stroock.

[5] The Motion has been briefed, argued and is ripe for determination.


Among other things, the Application and relevant undisputed documents before the court for Rule 12(b)(6) purposes allege:

[6] On or about January 30, 1998, Stroock entered into an engagement agreement ("Agreement")2 with Intelligent Card Services, Inc. ("ICS"), a company owned and controlled by Dorf.3 The Agreement outlined the terms under which Stroock would provide legal services to ICS, and included a provision that required the parties to submit any dispute between them to arbitration, to be conducted in the City of Los Angeles before the American Arbitration Association (the "AAA") in accordance with the Commercial Arbitration Rules of the AAA.

[7] Dorf signed the Agreement as president of ICS.4 The Agreement did not contain a personal guaranty or any similar language that by its terms bound Dorf personally to the terms of the Agreement.5

[8] Between 1999 and 2004, Stroock provided legal services to ICS.6 ICS ultimately defaulted on its obligation under the Agreement to pay Stroock for legal services.

[9] On May 13, 2003, Stroock sent a Demand for Arbitration ("Demand") to ICS and Dorf demanding legal fees and expenses in the amount of $256, 930.20. The subject line of the Demand was "Re: Stroock & Stroock & Lavan LLP v. Intelligent Card Services. Inc. DEMAND FOR ARBITRATION."7

[10] The first sentence of the Demand reads: "Pursuant to the January 30, 1998, retainer letter agreement between Stroock & Stroock & Lavan LLP ("Stroock"), and Intelligent Card Services, Inc. . . . "8

[11] An arbitration proceeding (the "Arbitration") was held before the Honorable Macklin Fleming (Ret.) on November 14, 2003.9 Neither Dorf nor any other ICS representative attended the Arbitration.10 On December 9, 2003, Judge Fleming issued an award in Stroock's favor (the "Award") against ICS and Dorf in the amount of $393, 423 for "legal services rendered for INTELLIGENT CARD and DORF at issue in this arbitration."11 The amount awarded included unpaid legal fees, costs and interest owed to Stroock, as well as the fees and costs that Stroock incurred in enforcing its rights under the Agreement through the Arbitration.12 Judge Fleming also found that Dorf, though not individually a signatory to the Agreement, was liable for the award because he had "acted continuously and exclusively as alter ego and sole principal for INTELLIGENT CARD. No effective separation of individual and corporate entity appeared. In substance the two were one."13

[12] On December 10, 2003, the Award was delivered via fax and regular and certified mail to Dorf at two Florida addresses.14 At no time did Dorf move to vacate, correct or modify the Award.15

[13] On March 22, 2007, Stroock filed a petition to confirm the Award in the Superior Court of California for the County of Los Angeles.16

[14] On May 17, 2007, Dorf removed the action to the United States District Court for the Central District of California, based on diversity jurisdiction.17

[15] On May 24, 2007, pursuant to Rules 12(b)(2) and 12(b)(6), Federal Rules of Civil Procedure ("Federal Rule(s)"), Dorf moved to dismiss the petition to confirm the award for (a) lack of personal jurisdiction and (b) failure to state a claim upon which relief can be granted (Dorf's "Federal Motion").18

[16] On June 25, 2007, the District Court held oral argument on Dorf's Federal Motion.19 On June 29, 2007, the court granted Dorf's Federal Motion for lack of personal jurisdiction, but not for failure to state a claim.20

[17] In its discussion regarding the personal jurisdictional issue raised by Dorf's Federal Motion, the District Court noted that the only evidence Stroock had presented to it in support of its allegation that Dorf was...

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