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Emese M. Varga v. Rent-A-Center East

December 18, 2012

EMESE M. VARGA, PLAINTIFF,
v.
RENT-A-CENTER EAST, INC., DEFENDANT.



The opinion of the court was delivered by: David E. Peebles U.S. Magistrate Judge

DECISION AND ORDER

This personal injury action, which has been settled, comes before the court for resolution of a fee dispute between the attorney who represented the plaintiff at the outset and the firm that was substituted in his place relatively early in the case, and thereafter represented the plaintiff through the time of settlement. That fee dispute has been referred to me for the issuance of a recommended resolution, pursuant to 28 U.S.C. § 636(b)(1)(B) and Federal Rule of Civil Procedure 54(d)(2)(D).

I. BACKGROUND

Plaintiff's claims in this case stem from an automobile accident that occurred on April 29, 2010, resulting in serious injuries to plaintiff Emese M. Varga. See generally Dkt. No. 1. On or about May 8, 2010, plaintiff retained Ronald R. Benjamin, Esq., on a contingency-fee basis to represent her in connection with any claim arising from the accident.*fn1 Dkt. No. 69 at 1; Dkt. No. 72 at 4.

Based upon the limited information now before the court, it appears that, following his engagement with plaintiff, Attorney Benjamin conducted an investigation into the accident, interviewed first responders, met with the plaintiff on multiple occasions both in the hospital and at her home, traveled to the scene of the accident to gather evidence and attempt to reconstruct the relevant events, obtained a police report concerning the incident, made freedom-of-information-law requests to the Village of Bainbridge and the Chenango County Highway Department, performed research, and drafted and filed the complaint in this action, which was commenced on May 13, 2010. Dkt. No. 69 at 1; Dkt. No. 71 at 3-4.

Shortly after commencement of this action, plaintiff discharged Attorney Benjamin, and retained the law firm Finkelstein & Partners, LLP ("F&P"). The record, however, is not clear as to the precise date on which plaintiff discharged Attorney Benjamin. Attorney Benjamin originally argued that he represented plaintiff "through July 2010," Dkt. No. 69 at 1, but F&P argues that plaintiff discharged Attorney Benjamin "by letter dated June 9, 2010," and that Attorney Benjamin acknowledged receipt of that letter on June 11, 2010, Dkt. No. 70 at 1; Dkt. No. 72 at 4. There appears to be no dispute, however, that plaintiff retained F&P to represent her in this matter on May 25, 2010. Dkt. No. 72 at 4. The court has been provided with little information concerning the substitution, but, significantly, F&P has acknowledged that Attorney Benjamin was not discharged for cause. Dkt. No. 72 at 4.

Following the receipt of plaintiff's discharge letter, Attorney Benjamin sought and received repayment for the disbursements advanced by him on the plaintiff's behalf. Dkt. No. 72 at 4. However, at the time of the substitution, which was formalized on the court's records on July 19, 2010, Dkt. No. 7, Attorney Benjamin and F&P left a determination as to the apportionment of attorney fees to be addressed at the conclusion of the action, Dkt. No. 72 at 4.

Following the retention of F&P, the case was actively litigated. See generally Docket Sheet. The parties engaged in considerable discovery, including the exchange of expert reports, and motions were brought by the plaintiff before the trial judge seeking an order dismissing defendant's affirmative defense and striking the report of one of defendant's experts. Dkt. Nos. 31-36, 40-54. A notice was ultimately sent by the court advising the parties that a jury trial was scheduled for October 29, 2012. Dkt. No. 62. In anticipation of trial, and at the request of the parties, District Judge Mae A. D'Agostino conducted a settlement conference on October 5, 2012, that resulted in settlement of the case in the amount of $2.3 million. Dkt. No. 63; Text Minute Entry dated Oct. 5, 2012.

Based upon that settlement, and the contingency fee arrangement between plaintiff and F&P, attorney fees payable from that settlement have been quantified in the amount of $741,698.79. Dkt. No. 72 at 5.

II. PROCEDURAL HISTORY

On October 29, 2012, Attorney Benjamin filed a letter with the court requesting permission to file a motion to enforce a charging lien upon the proceeds of the settlement, pursuant to N.Y. Judiciary Law § 475. Dkt. No. 69. F&P responded by letter dated October 30, 2012, in which the firm implicitly acknowledged Attorney Benjamin's right to share in the attorney fees, and maintained that an evidentiary hearing should be conducted to determine the proper apportionment. Dkt. No. 70.

On November 5, 2012, the court held a telephone conference concerning the issue. Text Minute Entry dated Nov. 5, 2012. During that conference, Attorney Benjamin was granted permission to file an application to quantify the attorney charging lien, and the court afforded F&P an opportunity to respond. Id. The parties have since filed the anticipated submissions with the court. Dkt. Nos. 71 and 72. Rather than applying for attorney fees and providing the court with the information necessary to begin the apportionment process, however, Attorney Benjamin instead has requested the opportunity to engage in discovery in order to assist him in developing the information necessary to support his claim. Dkt. No. 71. F&P has opposed that request. Dkt. No. 72.

III. DISCUSSION

By statute, New York recognizes the existence of a charging lien in favor of an attorney who appears in an action, but is subsequently replaced. N.Y. Judiciary Law ยง 475; see also Casper v. Lew Liberbaum & Co., Inc., 97-CV-3016, 1999 WL 335334, at *5 (S.D.N.Y. May 26, 1999). ...


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