United States District Court, W.D. Arkansas, Fayetteville Division
MEMORANDUM OPINION AND ORDER
Timothy L. Brooks, United States District Judge.
On
November 23, 2018, Plaintiff Henry Law Firm ("HLF")
filed a Motion for Summary Judgment (Doc. 92) against both
Defendant Cuker Interactive, LLC ("Cuker") and
Defendant Adel Atalla. The Court granted HLF's Motion
against separate Defendant Atalla in a Memorandum Opinion and
Order issued on January 4, 2019 (Doc. 126), but deferred
ruling on the Motion with respect to Cuker. This was because
the case against Cuker had been stayed due to Cuker's
bankruptcy filing.
On
April 1, 2019, Cuker advised the Court, see Doc.
160, that the bankruptcy court had issued an order granting
limited relief from the stay and permitting this Court to
rule on the pending summary judgment motion. Cuker then asked
the Court for a deadline of April 12 to respond to HLF's
Motion for Summary Judgment. The Court granted the request,
and Cuker filed its Response (Doc. 163) and Brief in Support
(Doc. 164) on April 12. On April 17, HLF filed a Reply (Doc.
165). The matter is now ripe for resolution.
The
Court will forego reciting the background facts of this case,
as they are adequately set forth in the Memorandum Opinion
and Order that granted summary judgment against Atalla, which
the Court incorporates by reference. See Doc. 126 at
2-5.
It is
well established that summary judgment should be granted
"if the movant shows that there is no genuine dispute as
to any material fact and the movant is entitled to judgment
as a matter of law." Fed.R.Civ.P. 56(a). The Court must
view the facts in the light most favorable to the non-moving
party, and give the non-moving party the benefit of any
logical inferences that can be drawn from the facts.
Canada v. Union Elec. Co., 135 F.3d 1211, 1212-13
(8th Cir. 1997). The moving party bears the burden of proving
the absence of any material factual disputes. Fed.R.Civ.P.
56(a); Matsushita Bee. Indus. Co. v. Zenith Radio
Corp., 475 U.S. 574, 586-87 (1986). If the moving party
meets this burden, then the non-moving party must "come
forward with 'specific facts showing that there is a
genuine issue for trial.'" Matsushita, 475
U.S. at 587 (quoting then-Fed. R. Civ. P. 56(e)) (emphasis
removed). These facts must be "such that a reasonable
jury could return a verdict for the nonmoving party."
Allison v. Flexway Trucking, Inc., 28 F.3d 64, 66
(8th Cir. 1994) (quoting Anderson v. Liberty Lobby,
Inc., 477 U.S. 242, 248 (1986)). "The nonmoving
party must do more than rely on allegations or denials in the
pleadings, and the court should grant summary judgment if any
essential element of the prima facie case is not supported by
specific facts sufficient to raise a genuine issue for
trial." Register v. Honeywell Fed. Mfg. &
Techs., LLC, 397 F.3d 1130, 1136 (8th Cir. 2005) (citing
Celotex Corp v. Catrett, 477 U.S. 317, 324 (1986)).
Cuker
contends in its Response to summary judgment that there are
genuine, material disputes of fact as to whether HLF's
attorneys diligently pursued Cuker's claims in the case
of Wal-Mart Stores, Inc. v. Cuker Interactive, LLC,
No. 5:14-CV-5262 ("the Walmart case"). Cuker had
entered into a legal services contract with HLF with respect
to the Walmart case, and now Cuker balks at paying the fees
it requested from the Court for HLF's services. Cuker
makes two arguments: (1) that HLF could have done a better
job for Cuker in the Walmart case and does not deserve the
attorneys' fees that were awarded by the Court, and (2)
that HLF overtoiled Cuker by engaging in irregular billing
practices and charging excessive hourly rates for certain
attorneys.
The
Court already explained in its previous Order (Doc. 126) that
Cuker, like separate Defendant Atalla, is judicially estopped
from contesting the fees now owed to HLF. See Id. at
10-14. Cuker petitioned for attorneys' fees and costs in
the Walmart case, and the Court reviewed the request and
awarded a total of $2, 174, 073.11 in fees to Cuker. This fee
award included fees for all of Cuker's attorneys,
including those employed by HLF. See No.
5:14-CV-5262, Doc. 524 at 43.
Cuker
also makes a curious argument that attorney Mark Henry of
HLF, who was lead trial counsel in the Walmart case, moved
for fees on his own, "without any input from
Cuker," and presumably not on behalf of Cuker, even
though Cuker was his client. Cuker contends that in light of
those facts, the Court should find that the doctrine of
judicial estoppel does not apply to bar Cuker from contesting
the amount of fees previously awarded by the Court in the
Walmart case. (Doc. 164 at 8). This argument is frivolous.
Mr. Henry moved the Court for fees (and sanctions) in the
Walmart case on behalf of his client, Cuker, and at no point
in the course of that lawsuit did Cuker or its principals
advise the Court in writing or otherwise that Mr. Henry had
been terminated or had otherwise "gone rogue" and
was now filing motions without Cuker's permission and
consent. The rest of Cuker's arguments attempt to
relitigate the Walmart case and second-guess HLF's
attorneys' litigation strategy-dr else, dispute the rates
that were charged by HLF's attorneys and ultimately
approved by the Court. Judicial estoppel applies to Cuker,
just as it applied to Atalla. As the Court explained in its
earlier Order:
Judicial estoppel upholds the "integrity of the judicial
process" by preventing "parties from deliberately
changing positions according to the exigencies of the
moment," whether in the same legal proceeding or a
previous one." New Hampshire v. Maine, 532 U.S.
742, 749 (2001) (quoting Edwards v. Aetna Life ins.
Co., 690 F.2d 595, 598 (6th Cir. 1982)). There is,
perhaps, no better example of a party deliberately changing
positions according to the financial "exigencies of the
moment" than Cuker's and Atalla's behavior in
this case.
(Doc. 126 at 10).
The
doctrine of judicial estoppel exists in order to prevent a
party from "be[ing] allowed to gain an advantage by
litigation on one theory, and then seek[ing] an inconsistent
advantage by pursuing an incompatible theory. 18 Charles Alan
Wright, Arthur Edward Miller, & Edward H. Cooper, Federal
Practice and Procedure § 4477, p. 782 (1981). Put
another way, the doctrine prevents a party who
"'assumes a certain position in a legal proceeding,
and succeeds in maintaining that position,' from later
'assum[ing] a contrary position.'" Scudder
v. Dolgencorp, LLC, 900 F.3d 1000, 1006 (8th Cir. 2018)
(quoting New Hampshire v. Maine, 532 U.S. 742, 749
(2001)). Several factors may be considered by the court in
determining whether judicial estoppel applies, including
whether: (1) "a party's later position [is]
'clearly inconsistent' with its earlier
position"; (2) "the party has succeeded in
persuading a court to accept that party's earlier
position, so that judicial acceptance of an inconsistent
position in a later proceeding would create the perception
that either the first or the second court was misled";
and (3) "the party seeking to assert an inconsistent
position would derive an unfair advantage or impose an unfair
detriment on the opposing party if not estopped."
Id. at 750-51 (internal quotation marks and
citations omitted).
Upon
due consideration, the Court finds that all three factors
above militate in favor of finding that Cuker is judicially
estopped from contesting the fees now owed to HLF. First,
Cuker's legal position in the Walmart case was that
HLF's hourly rates, legal work performed, and total
dollar amount of fees claimed were reasonable. Asserting
otherwise in the instant litigation is clearly inconsistent
with Cuker's earlier position. Second, Cuker persuaded
this Court in the Walmart case that HLF's fee demand was
reasonable. Arguing the opposite now is a bold attempt to
mislead this Court. Third, Cuker would derive an unfair
advantage or impose an unfair detriment on HLF if it were
permitted to assert such inconsistent positions. Accordingly,
the Court, in its discretion, invokes the equitable doctrine
of judicial estoppel to find that Cuker's arguments as to
the reasonableness of HLF's claim for fees are wholly
without merit.
For all
these reasons, IT IS ORDERED that Plaintiff
Henry Law Firm's Motion for Summary Judgment (Doc. 92) as
to Defendant Cuker Interactive, LLC is
GRANTED.[1] Thus, for the same reasons explained in
its prior Order (Doc. 126), the Court finds that Cuker is
liable to HLF in the sum of $1, 201, 802.32,
with interest accruing subsequent to January 4, 2019, at a
rate of 6% per annum until paid in full. Cf. Doc.
127. Judgment will reflect the fact that Cuker's
liability is joint and several with that of separate
Defendant Atalla.
IT
IS FURTHER ORDERED that Plaintiff Henry Law
Firm's Motion in Limine (Doc. 120) is
MOOT in light ...