Miller Weisbrod, LLP v. Klein Frank PC

Decision Date16 July 2014
Docket NumberCIVIL ACTION NO. 3:13-CV-2695-B
PartiesMILLER WEISBROD, LLP, et al., Plaintiffs, v. KLEIN FRANK PC, Defendant.
CourtU.S. District Court — Northern District of Texas
MEMORANDUM OPINION AND ORDER

Before the Court is Defendant Klein Frank P.C.'s Motion for Summary Judgment (doc. 30), filed November 22, 2013. For the reasons stated below, the Court DENIES Defendant's Motion.

I.BACKGROUND1

This case arises out of an attorney's fees dispute in a state personal injury lawsuit. In late 2009, Miller, Curtis, & Weisbrod, LLP ("Miller") was retained to act as local counsel in Dawson v. Fluor Intercontinental, Inc. et al., Case No. 09-cv-15340 ("the Dawson lawsuit"), a suit previously pending in the 134th District Court of Dallas County, Texas.2 Doc. 1-3, Orig. Pet. ¶ 9. David and Stephanie Dawson, the plaintiffs in the state court action, signed a fee agreement with Defendant Klein Frank P.C. (Klein Frank) and Miller that provided for an overall attorney's fee equal to 33.3%of any gross amount collected prior to appeal. Id.; doc. 41, Miller Fee Ag. Ex. C. Although the parties ultimately disagreed as to whether Miller was entitled to its share of the attorney's fees, a letter that accompanied the fee agreement further provided that Miller would take 30% of any attorney's fees collected and that Klein Frank would take the remaining 70%. Docs. 1-3, Orig. Pet. ¶ 9; 6, Def.'s Answer ¶ 9; 41, Letter Ex. C.

In August 2010, Klein Frank terminated Miller and subsequently entered into a fee-sharing agreement with Plaintiff James E. Girards and James E. Girards P.C. d/b/a The Girards Law firm ("the Girards"). See doc. 41, Letter Ex. A. The parties disagree as to the form and substance of this agreement, but they do agree that the Girards were retained to act as local counsel in the Dawson lawsuit. Docs. 6, Def.'s Answer ¶ 15; 41, Pls.' Resp. 3. On October 5, 2010, Klein Frank sent a letter ("the Letter") to the Dawsons in which it notified the Dawsons that the Girards had been retained as local counsel and indicated that the Girards would receive 15% of any attorney's fees recovered, with the possibility of receiving up to 30% of any attorney's fees if the case progressed to trial. Doc. 41, Letter Ex. A. Attached to this letter was a fee agreement (hereinafter "the Written Agreement") containing terms similar to those appearing in the prior fee agreement that Miller had signed. Id. The Dawsons, Klein Frank, and Jim Girards all signed the Written Agreement, although the heading above the signature blocks for Girards and the Dawsons indicated that they "approved" the Agreement. Id.

In the fall of 2011, Klein Frank also terminated the Girards. Docs. 1-3, Orig. Pet. ¶ 17; 6, Def.'s Answer ¶ 17. The Dawson lawsuit was later tried before a jury and judgment was rendered for David Dawson, awarding $17,328,280.00 in damages. Doc. 1, Notice of Removal 1. The case is currently on appeal before the Texas Fifth District Court of Appeals. Doc. 3, Notice of RelatedCases.

In late 2011, Klein Frank filed an action in Colorado state court seeking a declaration that the Girards and Miller were not entitled to attorney's fees for their work in the Dawson lawsuit because they were terminated for cause. Doc. 41, Colorado Order Ex. P, at 2; see also Klein Frank, P.C. v. Girards, 932 F. Supp. 2d 1203, 1208 (D. Colo. 2013). The case was later removed to the United States District Court for the District of Colorado and the court later granted the Girards' motion to dismiss for lack of personal jurisdiction. Klein Frank, P.C., 932 F. Supp. 2d at 1217.

On June 4, 2013, Plaintiffs filed their Original Petition in state court seeking a declaration that Miller is entitled to a 30% share of attorney's fees from the Dawson lawsuit, or, alternatively, the fair value of services rendered under quantum meruit, and that the Girards are entitled to a 15% share of the attorney's fees, or, alternatively, the fair value of services rendered under quantum meruit. Doc. 1-3, Orig. Pet. at 6. On July 12, 2013, Klein Frank filed its Notice of Removal (doc. 1) based on diversity. On September 24, 2013, Miller voluntarily dismissed its claims against Klein Frank and Klein Frank dismissed its counterclaims against Miller. Doc. 25, Stipulation. Klein Frank now moves for summary judgment on the Girards' claims.

II.LEGAL STANDARD

Federal Rule of Civil Procedure 56(a) provides that summary judgment is appropriate "if the movant shows that there is no genuine dispute as to any material fact and the movant is entitled to judgment as a matter of law." The substantive law governing a matter determines which facts are material to a case. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248 (1986). The summary judgment movant bears the burden to prove that no genuine issue of material fact exists. Latimer v. Smithkline& French Labs, 919 F.2d 301, 303 (5th Cir. 1990). However, if the non-movant ultimately bears the burden of proof at trial, the summary judgment movant may satisfy its burden by pointing to the mere absence of evidence supporting the non-movant's case. Celotex Corp. v. Catrett, 477 U.S. 317, 322-23 (1986).

Once the summary judgment movant has met this burden, the non-movant must "go beyond the pleadings and designate specific facts showing that there is a genuine issue for trial." Little v. Liquid Air Corp., 37 F.3d 1069, 1075 (5th Cir. 1994) (citing Celotex, 477 U.S. at 325). In determining whether a genuine issue exists for trial, the court will view all of the evidence in the light most favorable to the non-movant. Munoz v. Orr, 200 F.3d 291, 302 (5th Cir. 2000). But the non-movant must produce more than "some metaphysical doubt as to the material facts." Matsushita Elec. Indus. Co. v. Zenith Radio Corp., 475 U.S. 574, 586 (1986). If the non-movant is unable to make such a showing, the court must grant summary judgment. Little, 37 F.3d at 1076.

III.ANALYSIS
A. Objections

As an initial matter, the Court must address the Girards' objections to Klein Frank's summary judgment arguments. The Girards first object to Klein Frank's claims that the alleged fee-sharing agreement between the parties is illegal. The Girards insist that this defense was waived when it was not raised in Klein Frank's Answer. The Girards also object to Klein Frank's suggestion that this Court should consider the Colorado Rules of Professional Conduct in reaching its decision as to the enforceability of the fee-sharing agreement.

As to the Girards' first objection, they fail to establish that Klein Frank has waived itsillegality defense. Under Federal Rule of Civil Procedure 8(c), a part must, when responding to a pleading, "affirmatively state any avoidance or affirmative defense, including . . . estoppel." Failure to plead an affirmative defense may result in waiver. McDaniel v. IntegraCare Holdings, Inc., 901 F. Supp. 2d 863, 868 (N.D. Tex. 2012). Even if a defendant fails to set forth affirmative defenses in its responsive pleadings, however, if an affirmative defense "is raised in the trial court in a manner that does not result in unfair surprise, . . . technical failure to comply precisely with Rule 8(c) is not fatal." Lucas v. U.S., 807 F.2d 414, 417 (5th Cir. 1986) (citations omitted). If the defendant raises the defense "at a pragmatically sufficient time, and the plaintiff was not prejudiced in its ability to respond," then the affirmative defense is not waived. Id. "The prejudice inquiry considers whether the plaintiff had sufficient notice to prepare for and contest the defense, and not simply whether the defense, and evidence in support of it, were detrimental to the plaintiff." McDaniel, 901 F. Supp. 2d at 868 (citing Rogers v. McDorman, 521 F.3d 381, 387 (5th Cir. 2008)). Here, the Girards do not allege any prejudice that would arise from considering Klein Frank's illegality defense as raised in Klein Frank's Motion for Summary Judgment. Furthermore, the Court notes that Klein Frank filed its Motion on November 22, 2013, nearly four months before the end of the discovery period. The Girards do not explain why they were unable to conduct the necessary discovery to adequately prepare and respond to Klein Frank's motion during this period. McDaniel, 901 F. Supp. 2d at 868. Accordingly, the Court determines that the Girards were not prejudiced in their ability to respond when Klein Frank raised its illegality defense in its Motion for Summary Judgment, and the Girards' objection to Klein Frank's illegality defense is therefore OVERRULED.

As to the Girards' objection to Klein Frank's reliance on the Colorado Rules of Professional Conduct, the Court does not find it necessary to rule on this objection, for two reasons. First, theCourt does not need to rule on the Girards' objection because Klein Frank does not clearly ask the Court to treat the Colorado Rules as binding when reaching its holding. Rather, Klein Frank merely asks the Court to consider the Colorado Rules as relevant "circumstances." Doc. 31, Def.'s Br. 10. Klein Frank does not otherwise mention the Colorado Rules, and it does not respond to the Girards' objection. Second, even if the Court does take into account the Colorado Rules, they will not affect the Court's decision because the one Colorado Rule that Klein Frank relies upon is substantially similar to the corresponding Texas Rule. Klein Frank only cites to Colorado Rule 1.5(d) regarding divisions of attorney's fees between attorneys of different law firms. This rule provides that a client must confirm in writing her agreement to a division of fees among attorneys. Texas Disciplinary Rule of Professional Conduct 1.04(f) similarly requires a client to consent in writing to an arrangement for a division of fees. Because the Court concludes that the Rules are similar, and because it ultimately holds that the parties' fee-sharing agreement does not violate either Rule, it does not rule on the Girards' second objection.

B. Parties' Contentions

Klein...

To continue reading

Request your trial

VLEX uses login cookies to provide you with a better browsing experience. If you click on 'Accept' or continue browsing this site we consider that you accept our cookie policy. ACCEPT