Opinion
01 Civ. 5231 (KMW) (RLE)
November 8, 2002
OPINION AND ORDER
I. INTRODUCTION
Before this Court is an application by Quadrino Schwartz ("QS") for reconsideration of the part of this Court's opinion, dated October 24, 2002, denying QS's application for an immediate hearing to determine attorney's fees owed by defendants Dipak Nandi, M.D., Anil Menhandru, Iftikhar Malik, Afsar Gul, Bellalina Acevado, Universal Acupuncture Pain Services, P.C., N and R Associates, Inc., Urban Medical Diagnostics, P.C., Sterling Medical Diagnostic, P.C., Millennium Medical Diagnostics, P.C., Allenwood Medical Services, P.C., Triborough Healthcare Management, Inc., Triborough Medical Diagnostics, P.C., Fordham Management Consulting, Inc., Fordham Medical Pain Treatment, P.C., Plaza Management Consulting, Inc. and Plaza Medical Pain Treatment, P.C. (collectively the "Nandi defendants"). The Court, instead, deferred deciding attorney's fees until the conclusion of the underlying litigation, but ordered the Nandi defendants to post adequate security to insure QS's interest in its charging lien. For the following reasons, the application is DENIED.
II. BACKGROUND
The facts of this action have been set forth in Allstate v. Nandi, 2002 WL 31410642 (S.D.N.Y. 2002). For purposes of this motion, it is important to note that by oral order of this Court on September 23, 2002, the security previously ordered was to secure QS's charging lien against the Nandi defendant's. The Court declined to grant QS a retaining lien, and instead ordered the Nandi defendants to post security. Finally, the security in the full amount has been posted as of the time of this opinion.
III. DISCUSSION
As the Second Circuit has repeatedly held, "the decision whether to fix fees due a withdrawing attorney lies within the discretion of the district court." Pay Television of Greater New York v. Sheridan, 766 F.2d 92, 94 (2d Cir. 1985). Furthermore, "in setting fees, the district court is exercising ancillary jurisdiction." Id. In this case, the Court exercised its discretion in deciding that QS was entitled to a charging lien in this case, and required the posting of adequate security to secure QS's interests. See Allstate, 2002 WL 31410642 at *1. However, the charging lien itself goes "against any recovery or settlement if the fee has not yet been paid for services or disbursements." Misek-Falkoff v. International Business Machines Corporation, 829 F. Supp. 660, 663 (S.D.N.Y. 1993). Therefore, "the attorney's lien attaches to the fund ultimately recovered as a result of the litigation." Chesley v. Union Carbide Corporation, 927 F.2d 60, 67 (2d Cir. 1991). Finally, as previously noted by this Court, "[t]he posting of adequate security is to prevent the client from failing to pay fees and expenses to which the attorney is entitled." Allstate, 2002 WL 31410642 at *1. Although QS points to cases where courts have exercised their discretion and decided the amount of attorney's fees before the conclusion of the underlying litigation, courts have also exercised their discretion and decided the amount of attorney's fees at "the resolution of the main case to avoid interjecting side issues." Misek-Falkoff, 829 F. Supp. at 663. In this case, the Court finds that a delayed determination is appropriate so that the underlying litigation may proceed, and because the posted security adequately protects QS's interests.
Finally, QS notes in their moving papers that "the Court erroneously cited two cases cited by QS as authority for a different proposition, to wit: that security in the full amount in dispute should be posted by Nandi." QS went on to note that the Court properly cited Casper v. Lew Lieberman Co., Inc., 1999 WL 335334 (S.D.N.Y. 1999), and Shoe Show, Inc. v. Launzel, 1993 WL 150322 (E.D.N.Y. 1993), for the proposition that the Nandi defendants post security in the desired amount, but shouldn't have relied on those cases to support the Court's decision to decide the fee dispute at the resolution of the case. It seems disingenuous for QS to assert that the Court should rely on cases cited only for propositions that support it, but disregard those portions of the same case which may work to its detriment. Furthermore, QS asserts that in Casper, this Court decided to defer deciding attorney's fees until the end of the litigation because the case involved a contingency matter. However, QS's interpretation of this Court's opinion is erroneous. In Casper, this Court decided to defer the decision to determine attorney's fees until the end of the litigation not because of the contingency fee arrangement, but because, like this case, the matter involved a charging lien. See Casper, 1999 WL 335334 at *6. This determination was based on the fact that charging lien issues are often better decided at the end of the case when all relevant factors can be considered. Id. at *7. The Court stands by its reasoning in Casper, and QS's application to reconsider is DENIED.