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Riemer & Braunstein LLP v. Monroe Capital Management Advisors LLC

United States District Court, D. Massachusetts

May 16, 2019




         In this legal fees dispute, Plaintiff Riemer & Braunstein LLP (“Riemer & Braunstein”) brings claims against former clients Defendants Monroe Capital Management Advisors LLC, Monroe Capital Partners Fund LP, Monroe Capital Corporation, and Monroe Capital Partners Fund LLC (collectively, “Monroe”) for breach of contract, quantum meruit, unjust enrichment, account annexed, and breach of the obligations of good faith and fair dealing. [ECF No. 1-1 (“Compl.” or “Complaint”)]. Pending before the Court is Monroe's motion to dismiss the action for improper venue under Federal Rule of Civil Procedure 12(b)(3) or, in the alternative, to transfer the case under 28 U.S.C. § 1404(a) to either the Northern District of Illinois or the Northern District of Texas (“Motion to Dismiss or Transfer”). [ECF No. 6]. For the reasons set forth below, Monroe's Motion to Dismiss or Transfer [ECF No. 6] is DENIED.

         I. BACKGROUND

         The following facts are drawn from the Complaint, the allegations of which are accepted as true for the purpose of this motion to dismiss. See Gill v. Nakamura, No. 14-cv-13621, 2015 WL 5074475, at *2 (D. Mass. July 24, 2015). As it may on a motion to dismiss under Rule 12(b)(3), the Court has also considered affidavits and documentation submitted by the parties on the issue of whether venue is proper. See id.; Universal Trading & Inv. Co. v. Bureau of Representing Ukr. Interests in Int'l & Foreign Cts., 898 F.Supp.2d 301, 317 (D. Mass. 2012).

         Riemer & Braunstein is a Massachusetts limited liability partnership with a principal place of business in Boston, MA. [Compl. ¶ 1]. Defendants Monroe Capital Management and Monroe Capital Partners are Delaware limited liability companies headquartered in Chicago, IL. [Id. ¶¶ 2, 4]. Defendant Monroe Capital Partners Fund LP is a Delaware limited liability partnership headquartered in Chicago, IL. [Id. ¶ 3]. Defendant Monroe Capital Corporation is a public company incorporated in Maryland that transacts business by, through, and with its related and affiliated entities. [Id. ¶ 5]. Although none of the Monroe entities named as a defendant maintains an office in Massachusetts, [ECF No. 6-1 ¶ 5], one of Monroe Capital Corporation's affiliates, Monroe Capital, LLC, does. [Id. ¶ 4; ECF No. 7-1].

         Monroe retained Riemer & Braunstein in September 2005 and has engaged the law firm in over 20 matters since. [Compl. ¶ 7]. Central to the instant dispute, Monroe hired Riemer & Braunstein in 2016 to represent it as a secured senior lender in a planned bankruptcy proceeding for TPP Acquisition, Inc. (the “Debtor”), a company that Monroe indirectly owned. [Id. ¶¶ 8-9]. The Debtor filed for Chapter 11 bankruptcy on September 2, 2016 in the United States Bankruptcy Court for the Northern District of Texas (“Bankruptcy Court”). [Id. ¶ 11]. Prior to the Chapter 11 filing, Riemer & Braunstein represented Monroe in pre-bankruptcy negotiations, agreements, and dealings with the Debtor. [Id. ¶ 10]. These transactions, the details of which are not relevant to the instant motion, later resulted in hearings before the Bankruptcy Court and, ultimately, an adversary proceeding filed by the Official Committee of Unsecured Creditors against Monroe and affiliates of the Debtor on December 9, 2016 (“Adversary Proceeding”). [Id. ¶¶ 10, 12-15, 18]. The complaint in the Adversary Proceeding contained 28 claims for relief. [Id. ¶ 18].

         Monroe asked Riemer & Braunstein to defend it and the Debtor's affiliates in the Adversary Proceeding. [Id. ¶ 17]. As in other matters in which it engaged Riemer & Braunstein for representation, Monroe agreed to compensate Riemer & Braunstein for legal services on an hourly basis at established billing rates, including costs and disbursements. [Id. ¶ 19]. Riemer & Braunstein provided written budgets and fee estimates to Monroe and informed Monroe of its billing rates. [Id.]. Monroe instructed Riemer & Braunstein to forward its legal services invoices to Monroe Capital Advisors, which is not a defendant to this action. [Id.]. Monroe paid the invoices by wire or check sent to Riemer & Braunstein's Boston office. [Id.].

         In early 2017, Riemer & Braunstein filed a motion to dismiss 19 of the 28 counts in the Adversary Proceeding, which was allowed as to seven counts. [Id. ¶ 20]. In early 2018, a motion for partial summary judgment was also granted. [Id. ¶ 21].

         Throughout this time, Boston-based attorneys led the work on the Adversary Proceeding and exchanged communications with Monroe and its agents from Boston. [Id. ¶ 19]. Monroe's Chief Operating Officer and Chief Credit Officer (Michael J. Egan), Chief Executive Officer and President (Theodore L. Koenig), and General Counsel (Peter Gruszka) directed Riemer & Braunstein's work in the first half of 2017. [Id. ¶ 22]. Monroe's CEO met with Riemer & Braunstein attorneys in the law firm's Boston office on January 10, 2017 to discuss the defense in the Adversary Proceeding. [Id.]. Beginning in July 2017, Thomas Cronin (“Cronin”), an attorney not affiliated with Riemer & Braunstein, was retained by Monroe to serve as co-counsel in the Adversary Proceeding and to control the litigation strategy. [Id. ¶ 23].

         In January 2018, Cronin caused Monroe to replace Riemer & Braunstein as lead trial counsel with a local attorney, Jay Joseph Madrid (“Madrid”). [Id. ¶ 25]. Riemer & Braunstein was told that it would remain trial co-counsel and was “instructed to do all work that was necessary to protect Monroe” regarding the February 5, 2018 trial date until Madrid was prepared to try the case. [Id. ¶¶ 25, 27]. On January 8, 2018, Riemer & Braunstein was asked to oppose a trial continuance requested by opposing counsel and to prepare for trial. [Id. ¶ 27]. Preparation for trial continued through January, including preparing witness and exhibits lists, conclusions of law, a trial brief, and a joint pre-trial memorandum that were due on January 15, 2018 and responses to motions in limine that were due January 29, 2018. [Id. ¶ 29]. During this time, Riemer & Braunstein also worked with Madrid to get him up to speed and to coordinate tasks for trial. [Id.].

         On January 10 and 11, 2018, Riemer & Braunstein sent Monroe invoices totaling $126, 809.47 for services rendered in December 2017, including for obtaining partial summary judgment. [Id. ¶ 26]. On February 5, 2018, Riemer & Braunstein sent Monroe additional invoices for services rendered in January 2018, bringing the balance due to $392, 164.44. [Id. ¶¶ 28, 31]. Monroe did not object to the January invoice, but did object to the February one and sought to negotiate a discount. [Id. ¶ 28].

         In February 2018, Riemer & Braunstein made a demand upon Monroe for payment of all amounts due. [Id. ¶ 30]. When Monroe refused to pay the amounts due, Riemer & Braunstein sought leave of the Bankruptcy Court to withdraw as counsel for Monroe based on nonpayment of fees, which the Bankruptcy Court allowed on March 9, 2018. [Id. ¶ 32]. On March 14, 2018, Monroe terminated Riemer & Braunstein from all non-Adversary Proceeding matters. [Id. ¶ 33]. At least once thereafter, Monroe requested assistance from Riemer & Braunstein, for which work Riemer & Braunstein submitted a May 15, 2018 invoice. [Id. ¶ 34].

         On October 18, 2018, Riemer & Braunstein filed suit in Suffolk County Superior Court alleging breach of contract, quantum meruit, unjust enrichment, account annexed, and breach of obligations of good faith and fair dealing. [ECF No. 1-1 at 11-13]. The total amount of fees and disbursements unpaid at the time the Complaint was filed was $394, 911.44. [Compl. ¶ 36]. Monroe removed the action to this Court on November 16, 2018 on the basis of diversity jurisdiction, [ECF No. 1 at 1], and then moved to dismiss or transfer on November 30, 2018, [ECF No. 6]. Riemer & Braunstein opposed dismissal on December 14, 2018. [ECF No. 7]. Monroe filed a reply on December 31, 2018, [ECF No. 11], and Riemer & Braunstein submitted a sur-reply on January 8, 2019, [ECF No. 15].

         II. ...

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