Walker v. Williamson

• Decision Date: 18 September 2015
• Docket Number: Civil Action No. 1:14cv381–KS–JCG.
• Parties: Scott WALKER, et al., Plaintiffs v. Jimmy WILLIAMSON, et al., Defendants.
• Court: U.S. District Court — Southern District of Mississippi

131 F.Supp.3d 580

Scott WALKER, et al., Plaintiffs

v.Jimmy WILLIAMSON, et al., Defendants.

Civil Action No. 1:14cv381–KS–JCG.

United States District Court, S.D. Mississippi, Southern Division.

Signed Sept. 18, 2015.

Nathan S. Farmer, Nathan S. Farmer, PA, Picayune, MS, Tina L. Nicholson, Baker Nicholson, LLP, Houston, TX, for Plaintiffs.

Joe Sam Owen, Owen, Galloway & Myers, PLLC, William E. Whitfield, III, James E. Welch, Jr., Copeland, Cook, Taylor & Bush, PA, Gulfport, MS, John Michael Coleman, Jacob O. Malatesta, Hagwood Adelman Tipton, PC, Jackson, MS, L. Carl Hagwood, Hagwood Adelman Tipton, PC, Greenville, MS, Allison Standish Miller–PHV, George W. Billy Shepherd–PHV, Lamar G. Sellers–PHV, Stephen R. Bailey–PHV, Shepherd, Scott, Clawater & Houston, LLP, Houston, TX, for Defendants.

MEMORANDUM OPINION AND ORDER

KEITH STARRETT

, District Judge.

This matter is before the Court on various motions filed by Defendants, specifically, Defendant Michael A. Pohl's, Individually and d/b/a the Law Office of Michael A. Pohl, Motion to Dismiss Plaintiff's First Amended Complaint Pursuant to Rules 12(b)(6)

and 9(b) ("Pohl's Motion to Dismiss") [25], Jimmy Williamson and Jimmy Williamson P.C.'s Motion to Dismiss for Failure to State a Claim [27], and Jimmy Williamson and Jimmy Williamson P.C.'s Motion to Dismiss for Lack of Personal Jurisdiction [29]. Having considering the submissions by the parties, the record, and the applicable law, the Court finds the following:

1) Pohl's Motion to Dismiss [25] should be granted in part and denied in part;

2) Williamson's Motion to Dismiss for Failure to State a Claim [27] should be granted in part and denied in part; and

3) Williamson's Motion to Dismiss for Lack of Personal Jurisdiction [29] should be denied.

I. BACKGROUND

The current action was commenced on October 18, 2014, by Plaintiffs Scott Walker, individually and d/b/a Maxwell & Walker Consulting Group, LLC, and/or d/b/a Precision Marketing Group, LLC ("Walker"); Steve Seymour, individually and d/b/a Diamond Consulting and/or d/b/a Precision Marketing Group, LLC ("Seymour"); Kirk D. Ladner, individually and d/b/a The Ladner Group and/or d/b/a Precision Marketing Group, LLC ("Ladner"); and Precision Marketing Group, LLC, ("Precision") (collectively "Plaintiffs") against Defendants Jimmy Williamson, individually and/or as Director and President of Jimmy Williamson, P.C. (collectively "Williamson"), Michael A. Pohl, individually and d/b/a The Law Office of Michael A. Pohl ("Pohl"), and unnamed Defendants John and Jane Does A, B, C, D, E, F, and G. Defendants Williamson and Pohl are attorneys licensed to practice in the State of Texas.

In their Amended Complaint [19], filed on November 24, 2014, Plaintiffs allege that Pohl and Williamson joined together in a joint venture or partnership in order to represent Mississippi clients in their claims against British Petroleum ("BP") in connection with the 2010 Deepwater Horizon oil spill. (See Amended Complaint [19] at pp. 7–8 ¶ 27.) Plaintiffs contend that Pohl, on behalf of the joint venture/partnership he had with Williamson, contracted with them "to provide public relations and marketing services to aid in this endeavor." (See id. )

Plaintiffs allege that in April 2012, Pohl contacted Walker and told him of his partnership with Williamson and their goals. (See Amended Complaint [19] at pp. 7–8 ¶ 27.) Walker then agreed to provide public relations and marketing services for the partnership/joint venture. (See id. ) Williamson met with Pohl and Walker later that month on April 23, 2012. (See id. at p. 8 ¶ 28.) In May, Walker introduced Pohl to Seymour, who also agreed to provide public relations and marketing services for the enterprise. On May 25, 2012, in Biloxi, Mississippi, Pohl signed a contract with Walker, Seymour, and Terry Robinson (not a party to this suit) for the provision of public relations and marketing services in "the State of Mississippi and elsewhere." (See Amended Complaint [19] at pp. 8–9 ¶ 30; May Operating Agreement [19–2].) Under this contract, Plaintiffs provided services such as facilitating meetings between Defendants and potential Mississippi clients, introducing Defendants to Mississippi law firms and lawyers, and assisting in the hiring of investigatory contractors. (See Amended Complaint [19] at pp. 10–12 ¶¶ 33–37.) In exchange, Pohl agreed to pay Plaintiffs $1,500 an hour, based upon ten hour days, seven days a week. (See id. at pp. 12–13 ¶ 38.) Though the contract called for Plaintiffs to "keep accurate daily time records," Plaintiffs contend that Pohl assured them that detailed daily or hourly time records were not necessary under the contract and accepted and paid hourly invoices without such records. (See id. at p. 14 ¶¶ 41–42.) Through Plaintiffs' efforts, Pohl and Williamson gained the representation of over 1,000 Mississippi clients. (See id. at ¶ 44.)

Pohl requested a deferment of paying fees owed under the May Operation Agreement [19–2], to which Plaintiffs agreed, instead accepting periodic payments. (See id. at p. 15 ¶ 45.) Plaintiffs argue that these payments were bonuses or additional compensation outside the original contract, which they say Pohl ratified by accepting invoices that did not reflect credit for these payments. (See id. ) Between February 2013 and August 2013, Pohl requested periodic invoices for a specific number of hours, with which Plaintiffs complied. (See id. at p. 16 ¶ 46.) Each of these invoices were paid by Pohl at the agreed rate of $1,500 per hour, and a total of $59,750 was paid under these invoices. (See id. ) Plaintiffs contend that an additional $780,000 is owed under the May Operating Agreement [19–2]. (See id. at p. 17 ¶ 49.) Because Robinson has settled his claim under the May contract, Plaintiffs claim $576,200, plus reimbursement of expenses, is still owed to Walker and Seymour. (See id. )

In June 2012, Walker introduced Williamson to Ladner, who was then retained by Defendants to provide public relations and marketing services, initially on a limited per service basis. (See id. at p. 18 ¶ 50.) In July 2012, after informing Walker that Defendants wanted to end their relationship with Robinson, Pohl, on behalf of the Defendants, entered into a new contract with Walker, Seymour, and Ladner. (See id. at ¶¶ 50–51.) There was no time record keeping provision in the July 15, 2012 Contract. (See id. at p. 19 ¶ 52; July Operating Agreement [19–4].) The services Plaintiffs were to provide under this contract were substantially similar to the ones executed in May 2012. (See Amended Complaint [19] at p. 19 ¶ 53.) An additional service provided under the July contract, though, was the distribution of leather-bound wire-ring folders to potential BP claimants, which included a cover with "Michael A. Pohl Attorney at Law" written at the top, a letter on Williamson's letterhead, a contingency fee contract, and additional information. (See id. at pp. 19–20 ¶ 56; see also Pohl Notebook [19–5].)

Pohl agreed to pay Plaintiffs $1,500 per hour under the July contract, based upon ten hour days, seven days a week. (See Amended Complaint [19] at p. 22 ¶ 62.) Plaintiffs contend that, due to their efforts under the July contract, Williamson and Pohl gained the representation of about 9,500 clients, most of whom were from Mississippi. (See id. at p. 26 ¶ 69.) Plaintiffs claim that Pohl and Williamson owe them $7,875,000 under the July Operation Agreement [19–4], which they have refused to pay. (See id. at p. 28 ¶ 77.)

Plaintiffs are now bringing suit for breach of contract, conscious or negligent bad faith/breach of good faith and fair dealing, quantum meruit/unjust enrichment, and fraud/fraudulent inducement/fraudulent misrepresentation. On December 22, 2014, Defendant filed the current motions to dismiss under Federal Rule of Civil Procedure 12(b)(4)

and (b)(6).

II. CHOICE OF LAW

A federal court sitting in diversity is bound to follow the substantive law of the forum state, including that state's conflict of law rules. Klaxon Co. v. Stentor Elec. Mfg. Co., 313 U.S. 487, 496, 61 S.Ct. 1020, 1021, 85 L.Ed. 1477 (1941)

; see also Erie R.R. Co. v. Tompkins, 304 U.S. 64, 58 S.Ct. 817, 82 L.Ed. 1188 (1938). In Mississippi, a choice of law analysis is only appropriate where there is a true conflict between the laws of two or more states having an interest in the litigation. Zurich Am. Ins. Co. v. Goodwin, 920 So.2d 427, 437 (Miss.2006) (citing Boardman v. United Servs. Auto. Ass'n, 470 So.2d 1024, 1038 (Miss.1985) ). Once a true conflict is found to exist, Mississippi then employs a three-step choice of law analysis: (1) determine whether the conflicting laws are substantive or procedural; (2) classify the area of substantive law, whether tort, property, or contract; and (3) look at the relevant section of the Restatement (Second) of Conflict of Laws. Id. at 488

.

Pohl and Williamson identify only two potential conflicts between Mississippi and Texas laws: the application of the economic loss rule and the existence of a joint venture between Pohl and Williamson. For these two issues, Pohl and Wiliamson contend that laws of Texas should apply. Because "the law of a single state does not necessarily control every issue in a given case," the Court examines each potential conflict to determine which state's law should apply. Boardman, 470 So.2d at 1031

.

A. Application of the Economic Loss Rule

Under Texas law, the economic loss rule refers to the common law doctrine restricting recovery of purely economic damages in actions for unintentional torts. LAN/STV v. Martin K. Eby Const. Co., Inc., 435 S.W.3d 234, 235 (Tex.2014)

. "This rule generally precludes recovery in tort for economic losses resulting from the failure of a party to perform under a contract." Lamar Homes, Inc. v. Mid–Continent Cas. Co., 242 S.W.3d 1, 12 (Tex.2007) (citing Sw. Bell Tel. Co. v. DeLanney, 809 S.W.2d 493, 494–95 (Tex.1991) ). Mississippi applies the economic loss rule only in the...