It is almost universally said at Legal Malpractice (or Professional Responsibility) CLEs that suing your clients for legal fees not paid is the surest source of a legal malpractice counterclaim. Legal fee billing appears, anecdotally, to be the largest category of litigation involving attorneys. Exeter Law Group LLP v Immortalana Inc. 2016 NY Slip Op 31913(U) October 11, 2016 Supreme Court, New York County Docket Number: 161667/2014 Judge: Eileen A. Rakower is a prime example. From a preliminary glance, the parties have expended a couple of hundred hours of work on fees, and have barely ended the pleading stage.
“Plaintiff-counterclaim defendant The Exeter Law Group LLP (“Exeter”) brings suit to collect legal fees allegedly owed to it by Defendants. Exeter commenced this action against defendants Immortalana Inc. (“Immortalana”) and Robin Farias-Eisner (“Eisner”) by filing a Complaint on November 24, 2014 asserting six causes of action, including breach of contract (first cause of action), an account stated (second cause of action), unjust enrichment (third cause of action), quantum meruit (fourth cause of action), fraud (fifth cause of action), and tortious interference with contractual relations (sixth cause of action). On January 15, 2015, Immortalana and Eisner moved to dismiss portions of the complaint (Mot. Seq. #1) and, on June 30, 2015, the Court dismissed several of Exeter’s causes of action, including its second cause of action for an account stated, and directed Exeter to file an Amended Complaint. Exeter filed its Verified Amended Complaint on July 20, 2015. The Amended Complaint named Eisner and Immortalana as defendants, as well as Kelly Day (“Day”) and Salvaregen, Inc. (“Salvaregen”). Eisner and Day are individual defendants. Immortalana and Salvaregen are corporations in which Day and Eisner allegedly held shares and Exeter allegedly performed work on behalf of both companies. The Amended Complaint asserts the following claims: breach of contract as against Eisner and Day (first cause of action); account stated for the months of February 2013 through April 2013 as against Eisner and Day (second cause of action); unjust enrichment as against Immortalana and Salvaregen (third cause of action); quantum meruit as against Immortalana and Salvaregen (fourth cause of action); and account stated for the months of May 2012 through July 2013 as against Eisner and Day (fifth cause of action). ”
“Exeter claims that for approximately three years between 2011 and 2014, Day and Eisner, as the “clients,” engaged Exeter to represent them on two matters. On June 12, 2011, Day and Eisner executed an engagement letter engaging Exeter to provide advice “on patenting and regulatory strategy for the development of certain products that may be governed under [federal law].” On February 1, 2012, Day and Eisner executed a second engagement letter reengaging Exeter to “assist [Day and Eisner] in procuring counsel to enable Ms. Kelly Day to provide Five Hundred Thousand Dollars ($500,000.00) per year in financing from her personal funds toward the efforts of Dr. Robin Farias· Eisner to continue his research.” Exeter was to “identify and engage outside counsel” to complete the work if necessary. Exeter claims, “After uncovering irregularities and conflicts with the transactions, the Exeter Firm withdrew from the engagements.” Day and Eisner refused to pay the outstanding balance of Exeter’s invoices. Exeter commenced this action to recover those monies. ”
“As for Plaintiffs second and fifth causes of action, an account stated is “an account balanced and rendered, with an assent to the balance express or implied”. (Morrison Cohen Singer & Weinstein v. Janet L. N. Ackerman, 280 A.D.2d 355, 355-56 [1st Dep’t 2001]). ”
“Here, accepting Exeter’s allegations as true and drawing all inferences in favor of the non-moving party, the four comers of Exeter’s Amended Complaint adequately plead an account stated in the second cause of action. Turning to Exeter’s cross motion for summary judgment on the second cause of action for account stated, summary judgment, the proponent of a motion for summary judgment must make a prima facie showing of entitlement to judgment as a matter of law. ”
“Day’s affidavit attests to similar statements as set forth in Eisner’s affidavit. Attached to both are emails commencing August 25, 2014 between Wong, Eisner, and Day regarding billing issues. “