Opinion
Civil Docket No.: CL19-2663
12-09-2019
TANNERIP PLLC, Plaintiff, v. FACE INTERNATIONAL CORPORATION, Defendant.
ORDER
This matter came before the Court on Defendant's Demurrer filed on April 17, 2019. The Court heard oral argument on November 5, 2019, and per the Court's request, both parties subsequently submitted briefs supporting their positions. For the reasons stated herein, the Court OVERRULES Defendant's Demurrer.
The Complaint, which Plaintiff filed on March 18, 2019, alleges that Plaintiff rendered over one million dollars in legal services to Defendant regarding intellectual property matters. According to paragraph 7 of the Complaint, the parties entered into a Payment Agreement on July 27, 2018, whereby Defendant agreed to begin paying past due legal fees and Plaintiff agreed to continue the representation. Defendant allegedly breached that contractual obligation to pay past due debts to Plaintiff. The Complaint alleges that Plaintiff formally notified Defendant of the breach and of its intent to terminate the representation on November 12, 2018. Plaintiff alleges in paragraph 16 of the Complaint that:
On November 19, 2018, TannerIP formally terminated representation of FACE and provided FACE with notice of all pending deadlines for legal matters with respect to which TannerIP had been rendering legal services. A complete and accurate copy of TannerIP's written formal notice of termination, with attachments thereto, is attached as Exhibit C.
Defendant contends that Plaintiff failed to state a claim upon which the Court may grant relief because Plaintiff did not specifically allege the steps it took to withdraw from the representation. To support this claim, Defendant cites Virginia Rule of Professional Conduct 1.16(c), which provides: "In any court proceeding, counsel of record shall not withdraw except by leave of court after compliance with notice requirements pursuant to applicable Rules of Court. In any other matter, a lawyer shall continue representation notwithstanding good cause for terminating the representation, when ordered to do so by a tribunal." Defendant also cites the USPTO Rule of Professional Conduct outlined in 37 C.F.R. § 11.116(c) requiring a lawyer to "comply with applicable law requiring notice to or permission of a tribunal when terminating a representation. When ordered to so by a tribunal, a practitioner shall continue representation notwithstanding good cause for terminating the representation." A separate USPTO Rule of Professional Conduct details the steps an attorney must take to withdraw from representing a client in a USPTO matter. 37 C.F.R. § 2.19(b).
Defendant cites no legal authority to support its claim that Plaintiff must specifically plead the steps it took to withdraw from its representation in a suit seeking to collect legal fees. Virginia is a notice pleading state, and Rule 1:4(d) of the Rules of the Supreme Court of Virginia provides that a pleading "shall be sufficient if it clearly informs the opposite party of the true nature of the claim."
When ruling on a demurrer, the Court "will consider as true the facts alleged in the motion for judgment, the facts impliedly alleged therein, and the reasonable factual inferences that can be drawn from the facts alleged." McDermott v. Reynolds, 260 Va. 98, 100 (2000). Therefore, for purposes of this Demurrer, the Court accepts as true Plaintiff's assertion that it withdrew from its representation of Defendant and holds that Plaintiff's Complaint "states a cause of action upon which the requested relief may be granted." Augusta Mut. Ins. Co. v. Mason, 274 Va. 199, 204 (2007) (quoting Tronfeld v. Nationwide Mut. Ins. Co., 272 Va. 709, 712 (2006)).
Defendant argues that Plaintiff improperly withdrew from its legal representation, which bars Plaintiff's claim as a matter of law. In making that argument, Defendant alleges certain facts that have not been proven and are not in the record. This Court could perhaps make the determination Defendant asks it to make on a plea in bar or a motion for summary judgment, properly supported by a factual record, but not when it rules on a demurrer. Compare Va. Sup. Ct. R. 3:20, and Fultz v. Delhaize Am., Inc., 278 Va. 84, 88 (2009) (outlining when a court should grant a motion for summary judgment), with Mason, 274 Va. at 204 (delineating principles guiding a court's review of a demurrer). The Court further notes that the only case cited to support the proposition that improper withdrawal bars a lawyer from recovering fees, Petrovic v. Amico Oil Co., 200 F.3d 1140, 1156 (8th Cir. 1999), does not support that legal contention.
To the extent that Defendant asks the Court to infer that Plaintiff improperly terminated the legal representation based on the absence of specific facts in the pleading detailing that Plaintiff had taken all the required steps to terminate the representation, the Court will not make that inference. The pleading in paragraph 16 that the firm properly terminated the representation must be taken as true at this stage of the litigation. A demurrer is an improper vehicle for resolving whether Plaintiff properly withdrew from its representation.
For these reasons the Court OVERRULES Defendant's Demurrer.
The Court directs the Clerk to send a copy of this Order to counsel of record.
Counsel are directed to file written objections to this Order within ten days. Further endorsements by counsel are waived.
ENTER: December 9, 2019
/s/ _________
Mary Jane Hall, Circuit Judge