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Meunier Carlin & Curfman, LLC v. Scidera, Inc.

United States District Court, N.D. Georgia, Atlanta Division

June 22, 2018

MEUNIER CARLIN & CURFMAN, LLC, Plaintiff,
v.
SCIDERA, INC., Defendant.

          ORDER

          RICHARD W. STORY, UNITED STATES DISTRICT JUDGE

         At its core, this case presents the following question: when a client retains an attorney but later becomes dissatisfied with the quality or cost of the attorney's work, is the client, nevertheless, obligated to pay the attorney's fees and costs?

         In this case, Plaintiff Meunier Carlin & Curfman, LLC (“Meunier”), a law firm, seeks to recover unpaid costs and fees, as well as other damages associated with the legal services it provided to a former client, Defendant Scidera, Inc. (“Scidera”). The case comes before the Court, now, on Meunier's Motion for Summary Judgment [65] and Scidera's Motion for Partial Summary Judgment [66]. After reviewing the record, the Court enters the following Order.

         Background

         Some time in the fall of 2011, Scidera retained Meunier to manage its patent portfolios and the patent portfolios of its related entities. (Pl.'s Statement of Undisputed Material Facts (“Pl.'s SOF”), Dkt. [65-2] ¶ 4.) To memorialize their relationship, Meunier sent an engagement letter to Scidera, and the two exchanged drafts. (Id. ¶ 5.) Under the terms of the engagement letter, Meunier would bill Scidera for work performed at specified hourly rates. (Ex. E, Pl.'s SOF (“Engagement Letter”), Dkt. [65-8] at 5.) Scidera would also reimburse Meunier for costs associated with the representation. (Id.) Meunier would not, however, bill for travel time unless the attorney was actively working on something else for Scidera. (Id.)

         Scidera remained Meunier's client until at least 2015, and during that time Meunier represented Scidera and its related entities in various intellectual property matters. (Pl.'s SOF, Dkt. [65-2] ¶¶ 9, 11.) This included two federal lawsuits. (Id. ¶ 10.) Those suits arose from accusations of patent infringement by a competing company called Mars. (Id. ¶ 12.) The Parties learned of Mars's allegations in the fall of 2011, and on October 13, 2011, Meunier sent Scidera a memorandum laying out a litigation strategy and estimating its cost to be between $1, 182, 00 and $2, 042, 00.17. (Id. ¶¶ 12, 14; Ex. G, Pl.'s SOF (“2011 Memo”), Dkt. [65-10].)

         Mars filed the first lawsuit in the Eastern District of Virginia, then Meunier filed the second in California. (Pl.'s SOF, Dkt. [65-2] ¶¶ 15-16.) Meunier performed work for Scidera in both matters, taking direction from several Scidera executives, including its CEO, Chris Paxos, CFO, Myron Cybyk, and Scidera's intellectual property manager, Dan Smith. (Id. ¶¶ 16-23.) Eventually-and despite Scidera's opposition-the California case was transferred to Virginia. (Id. ¶ 17.)

         During discovery in the Virginia case, the judge ordered Scidera to produce a sizeable number of documents within a short period of time. (Id. ¶ 25.) Complying with that order called for additional help, so Meunier began looking for a litigation services company. (Id. ¶ 26; Dep. of Myron Cybyk (“Scidera Dep.”), Dkt. [33] at 57-58.)[1] Scidera told Meunier that its budget was $20, 000, (Def.'s Statement of Additional Material Facts that Present a Genuine Issue for Trial (“Def.'s Suppl. SOF”), Dkt. [75-5] ¶ 4; Scidera Dep., Dkt. [33] at 59-62, 64), but Meunier was unable to find a vendor willing to do the work for that price, (Ex. I, Pl.'s SOF, Dkt. [65-12]). Meunier, therefore, retained the most affordable option, Document Technologies, LLC (“DTI”). (Id.; Pl.'s SOF, Dkt. [65-1] ¶ 26.)[2] DTI performed the work and sent its bill to Meunier. Scidera, however, refused to pay for DTI's services. (Pl.'s SOF, Dkt. [65-1] ¶ 29; Def.'s Suppl. SOF, Dkt. [75-5] ¶¶ 3-6.)

         While the Virginia case was ongoing, Meunier sent invoices to Scidera for the work performed and expenses paid. (Pl.'s SOF, Dkt. [65-1] ¶ 30.) On April 24, 2012, after receiving the invoices, Scidera raised concerns over the growing cost of the litigation and the efficiency with which Meunier was handling it. (Id. ¶ 34; Def.'s Suppl. SOF, Dkt. [75-5] ¶ 17.) Just over a week later, Meunier responded with a lengthy email explaining the various complexities that had arisen in the case, which Meunier had not anticipated in its initial estimate. (Pl.'s SOF, Dkt. [65-1] ¶ 36.)

         In 2012, the Virginia case settled when Mars agreed to purchase the portfolio at issue from Scidera. (Scidera Dep., Dkt. [33] at 54-56; Aff. of Stephen M. Schaetzel (“Schaetzel Aff.”), Dkt. [65-4] ¶ 14.) After that, Scidera paid some of Meunier's invoices, but by October 2013, many were still outstanding. (Pl.'s SOF, Dkt. [65-1] ¶ 41.) So Meunier sent Scidera a formal demand letter; Scidera, however, did not respond. (Id. ¶¶ 41-42.) Yet, Scidera remained Meunier's client and continued to make payments until 2015, when the Parties' relationship ended. (Def.'s Statement of Undisputed Material Facts (“Def.'s SOF”), Dkt. [66-2] ¶ 18.) To date, the outstanding fees amount to $876, 871.07.[3] (Pl.'s SOF, Dkt. [65-1] ¶ 41.) Meunier filed this action to recover those fees on a breach of contract and open account theory.

         Additionally, DTI brought lawsuit against Meunier to collect on its unpaid invoices, which Scidera settled for $95, 000.00. (Id. ¶ 46.) Meunier seeks to recover that amount from Scidera as well, along with the costs Meunier incurred defending that lawsuit, under a theory of contribution and indemnity.

         Meunier has filed a Motion for Summary Judgment on each of the claims asserted in the Amended Complaint, with the exception of its claim for unjust enrichment and quantum meruit (Count III), which was pled in the alternative. Scidera, too, moves for summary judgment on Meunier's claim for attorney's fees and costs.

         Discussion

         I. Legal Standard

         Federal Rule of Civil Procedure 56 requires that summary judgment be granted “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 moving party bears ‘the initial responsibility of informing the . . . court of the basis for its motion, and identifying those portions of the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any, which it believes demonstrate the absence of a genuine issue of material fact.'” Hickson Corp. v. N. Crossarm Co., 357 F.3d 1256, 1259 (11th Cir. 2004) (quoting Celotex Corp. v. Catrett, 477 U.S. 317, 323 (1986)). Where the moving party makes such a showing, the burden shifts to the non-movant, who must go beyond the pleadings and present affirmative evidence to show that a genuine issue of material fact does exist. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 257 (1986).

         The applicable substantive law identifies which facts are material. Id. at 248. A fact is not material if a dispute over that fact will not affect the outcome of the suit under the governing law. Id. An issue is genuine when the evidence is such that a reasonable jury could return a verdict for the non-moving party. Id. at 249-50.

         Finally, in resolving a motion for summary judgment, the court must view all evidence and draw all reasonable inferences in the light most favorable to the non-moving party. Patton v. Triad Guar. Ins. Corp., 277 F.3d 1294, 1296 (11th Cir. 2002). But, the court is bound only to draw those inferences that are reasonable. “Where the record taken as a whole could not lead a rational trier of fact to find for the non-moving party, there is no genuine issue for trial.” Allen v. Tyson Foods, Inc., 121 F.3d 642, 646 (11th Cir. 1997) (quoting Matsushita Elec. Indus. Co. v. Zenith Radio Corp., 475 U.S. 574, 587 (1986)). “If the evidence is merely colorable, or is not significantly probative, summary judgment may be granted.” Anderson v. Liberty Lobby, Inc., 477 U.S. at 249-50 (internal citations omitted); see also Matsushita, 475 U.S. at 586 (once the moving party has met its burden under Rule 56(a), the nonmoving party “must do more than simply show there is some metaphysical doubt as to the material facts”).

         II. Analysis

         A. Admissibility of Contested Evidence

         Before reaching the merits of the pending motions, the Court must first determine which evidence may be considered in its analysis. That is because Scidera challenges the admissibility of several documents relied on by Meunier in support of its Motion for Summary Judgment. Specifically, Scidera argues that the invoices and accounting records reflecting Meunier's costs and fees are inadmissible hearsay, as are several emails exchanged between the parties; thus, Scidera argues, the Court should discount them in ruling on Meunier's Motion.

         “The general rule is that inadmissible hearsay cannot be considered on a motion for summary judgment.” Macuba v. Deboer, 193 F.3d 1316, 1323 (11th Cir. 1999). There is an exception, however, if the statement can be “reduced to admissible evidence at trial” or “reduced to admissible form.” Id. Hearsay might be reduced to an admissible form if, for example, “it falls within an exception to the hearsay rule, or does not constitute hearsay at all . . ., or is used solely for impeachment purposes (and not as substantive evidence).” Id. at 1323-24.

         1. Invoices and Accounting Records

         The Court finds the invoices and accounting records are “reducible to admissible form” because they fall within an exception to the hearsay rule, specifically Rule 803(6), the business records exception. See Macuba, 193 F.3d at 1323-24. Those records are supported by Schaeztel's affidavit. As a principal of the firm, Schaeztel is a “custodian or []other qualified witness, ” competent to lay the foundation for the business records. Fed.R.Evid. 803(6); Rosenberg v. Collins, 624 F.2d 659, 665 (5th Cir.1980)[4] (“Any person in a position to attest to the authenticity of certain records is competent to lay the foundation for the admissibility of the records.”). And although Schaeztel's affidavit does not elaborate on his own experience representing Scidera or how specifically the financial records were maintained, “[t]he absence or extent of personal knowledge regarding preparation of a business record affects the weight rather than the admissibility of the evidence.” Chadwick v. Bank of Am., N.A., 616 Fed.Appx. 944, 948 (11th Cir. 2015) (quoting United States v. Page, 544 F.2d 982, 987 (8th Cir.1976)). Schaeztel's affidavit is, therefore, sufficient to lay foundation for the records, so the Court may consider them on summary judgment.[5]

         2. Emails

         The Court likewise finds that the emails produced by Meunier are properly considered at this stage of the litigation. Scidera takes particular issue with an email sent from Schaetzel about the cost of retaining DTI. While it is true that this email, in its current form, would be inadmissible hearsay, it could easily be “reduced to admissible evidence at trial or reduced to an admissible form, ” say, by “hav[ing] the hearsay declarant testify directly to the matter at trial.” Jones v. UPS Ground Freight, 683 F.3d 1283, 1293 (11th Cir. 2012). The Court sees no reason why Schaetzel would be unable to testify directly about his discussions with DTI and the price estimate that he relayed to Scidera. In fact, Schaetzel has already submitted a sworn statement in this case. Consequently, the Court may consider the email in ruling on Meunier's Motion for Summary Judgment.

         B.Motions for Summary ...


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