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Adams v. John M. O'Quinn & Associates, PLLC

United States District Court, N.D. Mississippi, Greenville Division

March 30, 2017

RANDY L. ADAMS; DAVID J. AMONS; FREDDIE BOLTON, JR.; WILEY BROOKS; JR., Individually and as Representative of Estate of Wiley Brooks; ESTATE OF WILEY BROOKS; CLARENCE EDWARD BRYANT, SR.; JESSIE L. CARTER, JR.; SHURMON CHAFFEE; ZADIE DYKES, Individually and as Representative of the Estate of Billy E. Dykes; ESTATE OF BILLY E. DYKES; CHARLIE HARRIS, JR.; WALTER L. McCOY; PENELOPE McCOY, Individually and as Representative of the Estate of Willie J. McCoy; ESTATE OF WILLIE J. McCOY; ANNIE PEARL NEVELS, Individually and as Representative of the Estate of Louis Nevels; ESTATE OF LOUIS NEVELS; SELMOND NORALS; RANDOLPH PERRYMAN; JEAN Y. PEYREGNE; JOHN ALEXANDER PRINE; LARRY NOBLE SEWELL, SR.; LUTHER THREET; and BERDELL WILLIS PLAINTIFFS
v.
JOHN M. O'QUINN & ASSOCIATES, PLLC d/b/a The O'Quinn Law Firm; JOHN M. O'QUINN & ASSOCIATES, L.L.P.; JOHN M. O'QUINN, P.C.; JOHN M. O'QUINN LAW FIRM, PLLC; T. GERALD TREECE, Independent Executor of the Estate of John M. O'Quinn, Deceased; RICHARD N. LAMINACK; JOE GIBSON, DANZIGER & DE LLANO, LLP; and ABEL MANJI DEFENDANTS

          MEMORANDUM OPINION GRANTING DEFENDANT DANZIGER & DE LLANO LLP'S MOTION TO DISMISS AND, IN THE ALTERNATIVE, MOTION FOR A MORE DEFINITE STATEMENT

         Presently before the Court is a motion to dismiss for failure to state a claim and, in the alternative, motion for a more definite statement [34] filed by Defendant Danziger & De Llano, LLP ("Danziger"). Plaintiffs have filed a response, and Danziger has filed a reply. Upon due consideration, the Court finds that the motion should be granted.

         I. Factual and Procedural Background

         On March 14, 2016, Plaintiffs, as listed in the case caption above, filed this legal malpractice suit against the O'Quinn Firms and "related entities and persons, " including Danziger. Pis.' State-Ct. Compl. [2] ¶¶ 13. On April 13, 2016, Defendants timely removed the case to this Court on the basis of diversity of citizenship. Plaintiffs are citizens of Mississippi or Alabama; Defendants are citizens of Texas. The amount in controversy well exceeds the jurisdictional threshold, as it is undisputed that Plaintiffs seek actual, exemplary, and mental anguish damages in an amount greater than $75, 000 exclusive of interest and costs. Thus, the Court may exercise subject-matter jurisdiction in this case pursuant to 28 U.S.C. § 1332.

         Plaintiffs assert they were exposed to silica dust during their employment in various crafts, such as sandblasting. Due to this exposure, Plaintiffs maintain they were solicited as mass tort plaintiffs in silica litigation in the early 2000s when out-of-state law firms came into Mississippi and flooded Mississippi state courts with multiple-plaintiff suits. Plaintiffs allege, inter alia, that Defendants "led clients, the judicial system, defendants in the underlying case, and opposing counsel to believe that its clients had silicosis in order to generate millions of dollars in attorneys' fees and expenses." Id. ¶ 14. According to Plaintiffs, silicosis is a disease caused by the inhalation of silica dust.

         Plaintiffs allege that the O'Quinn Firms represented approximately 3, 000 clients, who were occupationally exposed to silica-containing products and materials, and that law firms, including Danziger, solicited these Plaintiffs to enter into contracts and promised to litigate their silicosis claims against the silicosis defendants, but subsequently referred the silicosis claims to the O'Quinn Firms. Id. ¶ 16. Plaintiffs further allege that "[a]s much of 98% of [the O'Quinn Firms'] silicosis docket came from referring law firms, " which "included [Danziger] and others, who are jointly responsible for any wrongful acts committed by [the O'Quinn Firms] or its attorneys." Id. Plaintiffs allege that they "initially signed contingency fee contracts with either one of the referring lawyers or signed the initial contract directly with [the O'Quinn Firms]." Id. ¶17.

         According to Plaintiffs, Defendants, including Danziger, improperly billed the amounts they paid to companies for medical screening and/or referrals as expenses in their individual cases, conduct that was "unethical" and "a breach of fiduciary duty." Id. ¶¶ 21-22. Plaintiffs aver that Defendants, including Danziger, hand-selected medical professionals who diagnosed Plaintiffs with silicosis and other silicosis-related diseases. Id. ¶ 23. Plaintiffs allege that although the O'Quinn Firms reached global settlements with several of the silica manufacturers/distributors that were sued, the O'Quinn Firms failed to distribute the settlement proceeds in a timely manner and wrongfully retained portions of those proceeds for their own use. Plaintiffs aver that they were required to pay the O'Quinn Firms a percentage of their settlement proceeds to cover so-called general expenses of the O'Quinn Firms, including referral fees to other law firms and medical screening companies; office overhead and supplies; and costs associated with excessive travel, lodging, and dining. Plaintiffs further aver that "the referring lawyers, including Danziger . . ., had Plaintiffs sign" a new agreement with the O'Quinn Firms "which materially altered the terms of [a] prior agreement and contained the 'general expense' language." Id. ¶ 29. Plaintiffs allege that "[n]either [the O'Quinn Firms] nor the referring lawyers disclosed the pros and cons of the advantages and disadvantages of this subsequent agreement." Id. Plaintiffs further allege that by 2003, the litigation expenses for the O'Quinn Firms' silicosis docket was "out of control" with expenses amounting to "over $10 million dollars, " including "[approximately $1.7 million" that "was paid to the referral lawyers such as [Danziger] for screening cases . . . ." Id. ¶ 31. Finally, Plaintiffs allege that the O'Quinn Firms made multiple errors in processing settlements, including delays and lack of communication, and ultimately failed to fully investigate and assess Plaintiffs' individual claims, including ensuring that settlements were paid in accordance with the severity of Plaintiffs' medical conditions, entering into aggregate or global settlements with silica manufacturers and/or distributors and then intimidating and coercing Plaintiffs into accepting those settlements regardless of the nature and extent of their individual silica-related injuries, permitting the wrongful dismissal of claims against several silica manufacturers and/or distributors, failing to provide necessary paperwork to the courts, failing to process and/or finalize settlement agreements, and attempting to conceal wrongful behavior by sending Plaintiffs deceptive disclosure letters and by destroying and/or altering documents in their files.

         Plaintiffs assert claims for legal malpractice/negligence, gross negligence, breach of fiduciary duty, breach of contract, constructive fraud, fraud, and negligent misrepresentation.[1] Plaintiffs alternatively assert claims for fraud by non-disclosure, negligent or intentional infliction of emotional distress, civil conspiracy, and vicarious liability.[2]

         II. Legal Standards

         Motions to dismiss pursuant to Rule 12(b)(6) "are viewed with disfavor and are rarely granted." Kocurek v. Cuna Mut. Ins. Soc'y, 459 F.App'x 371, 373 (5th Cir. 2012) (citing Gregson v. Zurich Am. Ins. Co., 322 F.3d 883, 885 (5th Cir. 2003)). "[A plaintiffs] complaint therefore 'must contain sufficient factual matter, accepted as true, to "state a claim to relief that is plausible on its face." ' " Phillips v. City of Dallas, Tex., 781 F.3d 772, 775-76 (5th Cir. 2015) (quoting Ashcroft v. Iqbal, 556 U.S. 662, 678, 129 S.Ct. 1937, 173 L.Ed.2d 868 (2009) (quoting Bell Atl. Corp. v. Twombly, 550 U.S. 544, 570, 127 S.Ct. 1955, 167 L.Ed.2d 929 (2007))). A claim is facially plausible when the pleaded factual content "allows the court to draw the reasonable inference that the defendant is liable for the misconduct alleged." Iqbal, 556 U.S. at 678, 129 S.Ct. 1937 (citing Twombly, 550 U.S. at 556, 127 S.Ct. 1955). "[P]laintiffs must allege facts that support the elements of the cause of action in order to make out a valid claim." Webb v. Morella, 522 F.App'x 238, 241 (5th Cir. 2013) (per curiam) (quoting City of Clinton, Ark. v. Pilgrim's Pride Corp., 632 F.3d 148, 152-53 (5th Cir. 2010) (quotation marks omitted)). "[C]onclusory allegations or legal conclusions masquerading as factual conclusions will not suffice to prevent a motion to dismiss." Id. (quoting Fernandez-Montes v. Allied Pilots Ass'n, 987 F.2d 278, 284 (5th Cir. 1993) (internal quotation marks omitted)). "Dismissal is appropriate when the plaintiff has not alleged 'enough facts to state a claim to relief that is plausible on its face' and has failed to 'raise a right to relief above the speculative level.' " Emesowum v. Hous. Police Dep't, 561 F.App'x 372, 372 (5th Cir. 2014) (per curiam) (quoting Twombly, 550 U.S. at 555, 570, 127 S.Ct. 1955).

         As stated, Danziger alternatively moves under Rule 12(e) for the Court to order Plaintiffs to amend their complaint in order to provide a more definite statement of their claims. Rule 12(e) provides that "[a] party may move for a more definite statement of a pleading to which a responsive pleading is allowed but which is so vague or ambiguous that the party cannot reasonably prepare a response. The motion must be made before filing a responsive pleading and must point out the defects complained of and the details desired." Fed.R.Civ.P. 12(e).

         With the foregoing standards in mind, the Court turns to the motion before it.

         III. Analysis and Discussion

         Danziger moves to dismiss Plaintiffs' claims under Rule 12(b)(6) on the following grounds: (1) the claims are barred by the applicable Mississippi statute of limitations; (2) the complaint fails to specify duties, acts, and omissions of each Defendant as they pertain to each Plaintiff; and (3) the complaint fails to state claims for legal malpractice based on negligence, fraud, and negligent or intentional infliction of emotional distress. Alternatively, Danziger moves for the Court to order Plaintiffs to provide a more definite statement of their pleading under Rule 12(e).

         In response, Plaintiffs argue that they have alleged plausible claims against Danziger and that their claims are neither time-barred under the discovery rule nor otherwise, because Defendants fraudulently concealed the claims. In the alternative, Plaintiffs argue that if their allegations fail to satisfy Rule 12's standards, Plaintiffs should be granted leave to amend their complaint. Because the Court finds that the claims are barred by the statute of ...


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