United States District Court, S.D. New York
the plaintiffs: Daniel A. Osborn The Osborn Law Group.
the defendant: Barry J. Muller Barri A. Frankfurter Fox
MEMORANDUM OPINION & ORDER
Cote United States District Judge.
Beatie and Osborn LLP and Osborn Law, P.C. bring this lawsuit
alleging that the defendant Jeffrey Bogert
(“Bogert”) failed to repay loans
(“Loans”) that the plaintiffs made to him. Bogert
has moved to dismiss the first amended complaint
(“FAC”) as barred by prior litigation in New
Jersey between the parties and pursuant to New Jersey's
entire controversy doctrine (“NJECD”). The motion
plaintiffs and Bogert were co-counsel on hundreds of personal
injury cases (the “ONJ Litigation”). The
plaintiffs assert in the instant action that during the ONJ
Litigation they lent Bogert $177, 065.56, which Bogert agreed
to repay at the conclusion of the litigation. The ONJ
Litigation was settled on November 21, 2014, but Bogert has
not repaid any portion of the Loans. In this action, the
plaintiffs assert claims for breach of an agreement to repay
the Loans and unjust enrichment.
briefing on Bogert's motion to dismiss attaches filings
from the New Jersey litigation that reveal the following:
During the ONJ Litigation, RD Legal Funding Partners, LP
(“RD Legal”) provided the plaintiffs with
financing to pursue the ONJ Litigation. Upon settlement of
the ONJ Litigation, RD Legal sued Bogert in New Jersey state
court, asserting that Bogert had signed a subordination
agreement in which he pledged the attorneys' fees he
might receive from the ONJ Litigation as collateral in the
event that the fees earned by the plaintiffs in the ONJ
Litigation were not sufficient to repay RD Legal. Bogert
filed a third-party complaint against the plaintiffs alleging
that the parties had agreed to reimburse RD Legal
proportionally to the funds each party received.
March 10, 2016, the New Jersey Superior Court granted the
motions brought by RD Legal and the plaintiffs for summary
judgment against Bogert. Bogert has appealed the Superior
granting summary judgment against Bogert, the court made the
following rulings of significance to the instant action.
Without the funding provided by RD Legal, Bogert and the
plaintiffs would have been unable to continue representing
their clients in the ONJ Litigation. The court found that a
September 2009 subordination agreement between RD Legal and
Bogert was enforceable and entitled RD Legal to the legal
fees awarded to Bogert. It found further that Bogert had
provided no evidence that the parties had an agreement
whereby the parties would reimburse RD Legal proportionally
to the funds each party received. It also rejected
Bogert's argument that the plaintiffs had a duty to
contribute to the amount that Bogert owed RD Legal.
brief on appeal in the New Jersey action, the plaintiffs
indicated that Osborn individually and Beatie and Osborn LLP
had lent Bogert tens of thousands of dollars prior to 2009,
and had never been repaid. Bogert again asked to borrow money
around 2009, and Osborn Law agreed to lend Bogert funds
“if and when” they became available.
October 7, 2016, the plaintiffs filed this lawsuit against
Bogert seeking repayment of the Loans. On April 5, 2017,
Bogert filed a motion to dismiss the FAC pursuant to Rule
12(b)(6), arguing that the plaintiffs' claims are
precluded by the NJECD.
argues that the plaintiffs' claims in this diversity
action are precluded by the NJECD. Under the full faith and
credit clause, a federal court must give a state court
judgment “the same preclusive effect as would be given
that judgment under the law of the State in which the
judgment was rendered.” Migra v. Warren City Sch. Dist.
Bd. of Educ., 465 U.S. 75, 81 (1984).
NJECD precludes “all claims arising out of the same
controversy that could have been raised in the earlier
action, including those involving different legal theories or
requesting alternative relief.” Stochastic Decisions,
Inc. v. DiDomenico, 995 F.2d 1158, 1170 (2d Cir.
1993). “In determining whether a subsequent
claim should be barred under [the NJECD], the central
consideration is whether the claims against the different
parties arise from related facts or the same transaction or
series of transactions. . . . There is no requirement that
there be a commonality of legal issues.” Wadeer v. New
Jersey Mfrs. Ins. Co., 220 N.J. 591, 605 (2015) (citation