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Lani v. Schiller Kessler & Gomez, PLC

United States District Court, W.D. Kentucky, Louisville

March 16, 2017

ALAN LANI, on behalf of SCHILLER KESSLER & GOMEZ, PLLC, A Kentucky Professional Limited Liability Company PLAINTIFF
v.
SCHILLER KESSLER & GOMEZ, PLC, A Florida Professional Limited Company, MARC SCHILLER; ANDREW KESSLER; MARCELO GOMEZ; SCHILLER KESSLER & GOMEZ, PLLC DEFENDANTS

          MEMORANDUM OPINION

          Charles R. Simpson III, Senior Judge.

         I. Introduction

         This matter is before the Court on the motion of Plaintiff Alan Lani to vacate or amend under Federal Rule of Civil Procedure 60(b) the August 10, 2016 memorandum opinion and order of the Court dismissing his claims without prejudice based upon lack of subject matter jurisdiction.[1] Mot. Vacate 1, ECF No. 34. Defendants Schiller Kessler & Gomez, PLC, Marc Schiller, Andrew Kessler, Marcelo Gomez, and Schiller Kessler & Gomez, PLLC (“Defendants”) responded. Resp. Opp. Mot. Vacate 1, ECF No. 43. Lani replied. Reply 1, ECF No. 47.

         Lani also moved to vacate or amend under Federal Rule of Civil Procedure 59 the December 19, 2016 memorandum opinion and order of the Court requiring him to pay Defendants' reasonable attorney fees and costs under Kentucky Revised Statute § 275.337(8)(a). Mot. Vacate 1, ECF No. 33. Defendants responded. Resp. Opp. Mot. Vacate 1, ECF No. 44. Lani replied. Reply, ECF No. 46.

         If successful in vacating or amending the memorandum opinions and orders, Lani asks that the Court grant his motion to remand, which was denied in the August 10, 2016 memorandum opinion and order. Mot. Vacate 2, ECF No. 34; Mem. Supp. Mot. Vacate 23, ECF No. 34-1; Order 8/10/16 1, ECF No. 18. Lani also requests that the Court award him $43, 000.00 under 28 U.S.C. § 1447(c). Mot. Vacate 2, ECF No. 34; Mem. Supp. Mot. Vacate 23, ECF No. 34-1. He alternatively asks that Court stay the proceedings and conduct an evidentiary hearing regarding an alleged conflict of interest involving defense counsel. Id.

         Because these motions involve the same facts and similar issues, the Court will address them in a single memorandum opinion and order. For the reasons discussed below, the Court will deny Lani's motion to vacate or amend the August 10, 2016 memorandum opinion and order of the Court dismissing the claims without prejudice. The Court will deny Lani's motion to vacate or amend the December 19, 2016 memorandum opinion and order of the Court granting Defendants an award of attorney fees and costs. The Court will also deny Lani's secondary requests that that his motion to remand be granted, that he be granted an award of attorney fees under 28 U.S.C. § 1447(c), and that the Court stay the proceedings and conduct an evidentiary hearing on the alleged conflict of interest involving defense counsel.

         II. Background

         A. Lani's Relationship with Defendants, His “My Departure” Email, and Defendants' Response

         Schiller Kessler & Gomez, PLLC is a limited liability company organized under Kentucky law. Operating Agreement 12, ECF No. 43-5. It originally had two members: Lani and Schiller Kessler & Gomez, PLC, a Florida professional limited liability company. Id. at 40. Lani owned a 33.33% interest in Schiller Kessler & Gomez, PLLC. Schiller Aff. ¶ 11, ECF No. 45-1. Schiller Kessler & Gomez, PLC owned the remaining 66.67% interest. Id. The relationship between the members of Schiller Kessler & Gomez, PLLC was governed by the August 11, 2014 Amended and Restated Operating Agreement (“the operating agreement”). Id. ¶¶ 10-11.

         The operating agreement contained several provisions relating to Lani's potential resignation from his position at Schiller Kessler & Gomez, PLLC. Operating Agreement 34, ECF No. 43-5. One of these provisions required Lani to provide six months' written notice of his intent to resign before he resigned. Id. Another provision stated that Lani's rights related to cash flow, payment of his health insurance and bar dues, taxable income, share in profits, and case transferal ceased upon Lani's tendering a notice of resignation from Schiller Kessler & Gomez, PLLC. Id.

         On November 18, 2015, Lani wrote Kessler, Schiller, and Gomez, the individual members of Schiller Kessler & Gomez, PLC, an email entitled “my departure.” Lani Email 11/8/2015 2, ECF No. 43-1. In the email, Lani stated, “As previously indicated, I do not intend to continue my relationship with [Schiller Kessler & Gomez, PLLC] any longer than absolutely necessary to conduct the client notifications required by the Kentucky Bar and transition responsibility for the existing files to another Kentucky-licensed attorney.” Id. He continued, “In no event can such transition take longer than the remaining month of November, as I begin my new opportunity December 1st.” Id. He ended his email by writing, “My offer to avoid litigation between us is to pay me the 5833 we already discussed[, ] and I'll process any existing settlements over the next two weeks without a personal claim for payment.” Id.

         On November 24, Tom Rutledge, an attorney representing Schiller Kessler & Gomez, PLLC, wrote Lani a letter in response to his “my departure” email. Rutledge Letter 11/24/2015 1, ECF No. 8-1. In the letter, Rutledge asserted that Lani's email “constitute[d] a breach of the express terms of the Operating Agreement” because he failed to provide six months' written notice of his resignation. Id. Rutledge ended the letter by stating:

In order to provide an opportunity to militate the situation, we extend you an offer that you provide a written plan for separation that addresses and resolves all of the issues identified in this letter and otherwise arising under the Operating Agreement. Absent your willingness to do so, [Schiller Kessler & Gomez, PLLC] will pursuit its legal rights. Any communications with respect to that resolution should be to my attention and, again, must be in writing.

Id. at 3.

         B. Procedural History

         As this Court has previously explained, Lani filed a purported derivative action on behalf of Schiller Kessler & Gomez, PLLC's membership interests in the Jefferson County, Kentucky Circuit Court on December 1, 2015. Compl. 1, ECF No. 1-1. Lani alleged that the individual defendants-Schiller, Kessler, and Gomez-began improperly sending fees earned by the company in Kentucky to their Florida business, Schiller Kessler & Gomez, PLC, which caused the Kentucky company to suffer financial losses. Id. ¶ 18-20.

         In January 2016, Schiller Kessler & Gomez, PLC and the individual defendants, Schiller, Kessler, and Gomez, removed the suit to this Court under diversity jurisdiction, 28 U.S.C. § 1332. Not. Removal 1, ECF No. 1. That same day, Schiller Kessler & Gomez, PLC and the individual defendants moved to intervene and realign the parties so that Schiller Kessler & Gomez, PLLC would be a nominal defendant. Mot. Intervene 1, ECF No. 3. Defendants simultaneously moved to dismiss the suit with prejudice for lack of subject matter jurisdiction under Federal Rule of Civil Procedure 12(b)(1), for failure to state a claim under Rule 12(b)(6), and/or for lack of personal jurisdiction under Rule 12(b)(2). Mot. Dismiss 1, ECF No. 2.

         In February 2016, Lani moved to remand the case to the Jefferson County Circuit Court. Mot. Remand 1, ECF No. 6. He also moved in the alternative to add Schiller Kessler & Gomez, PLLC as a defendant and then to remand the case to the state court. Mot. Am. 1, ECF No. 7. Lani also moved to stay a decision on Defendants' motion to dismiss and motion to realign the parties until the Court resolved an alleged conflict of interest on behalf of defense counsel, Stoll Keenon Ogden PLLC. Mot. Stay 1, ECF No. 8. Lani finally moved to file a sur-reply to Defendants' motions to dismiss and to intervene. Mot. Sur-Reply 1, ECF No. 11.

         In its August 10, 2016 memorandum opinion and order, the Court addressed the pending motions:

1. Defendants' motion to dismiss for lack of subject matter jurisdiction, personal jurisdiction, and/or failure to state a claim;
2. Defendants' motion to intervene and realign the parties;
3. Lani's motion to remand the case to the Jefferson County Circuit Court;
4. Lani's alternative motion to add a party defendant and to remand the case to the Jefferson County Circuit Court;
5. Lani's motion to hold in abeyance Defendants' motions to dismiss, and to intervene and ...

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