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Ltd v. Cohen

United States District Court, W.D. Louisiana, Monroe Division

January 5, 2018

LUV N' CARE, LTD, Plaintiff
v.
MORRIS E. COHEN, ET AL., Defendants

          JAMES, JUDGE

          REPORT AND RECOMMENDATION

          Joseph H.L. Perez-Montes United States Magistrate Judge

         Before the Court is Plaintiff Luv N' Care, LTD's (“LNC”) Second Rule 11 Motion and Supporting Memorandum (“Rule 11 Motion for Sanctions”). (Doc. 54). LNC seeks sanctions against Defendants' counsel, Gordon L. James, and the law firm of Hudson, Potts & Bernstein, L.L.P. for submitting their Motion to Transfer (Doc. 21). LNC's Rule 11 Motion for Sanctions (Doc. 54) should be denied as moot.

         I. Background

         Goldberg Cohen, L.L.P. is a law firm formed in 2010 to represent LNC and its affiliate Admar International, Inc. in their intellectual property matters. (Docs. 1, 6-1). Morris E. Cohen (“Cohen”) is the nephew of the three founders of LNC and a first cousin to its present-day shareholders. (Docs. 1, 6-5).

         Cohen and Lee A. Goldberg (“Goldberg”) (collectively “Defendants”) represented LNC pro hac vice in a Louisiana proceeding filed in the Louisiana Fourth Judicial District Court in Ouachita Parish, Luv N' Care, Ltd. v. Jackel Int'l Ltd, et al., No. 10-1891 (“the Jackel case”) (Docs. 1, 6-6).[1] At some point in the Jackel case, LNC terminated Goldberg Cohen, L.L.P.'s representation and employed new counsel. (Doc. 1).

         On November 23, 2015, LNC filed a suit against Defendants in the United States District Court for the Southern District of New York for five claims of legal malpractice in various cases. On August 18, 2016, that action was dismissed as time-barred. See Luv N' Care, Ltd., et al. v. Goldberg Cohen, LLP, et al, No. 1:15-cv-09248, 2016 WL 4411419, at *7-*8 (S.D.N.Y. Aug. 18, 2016), recon. den'd, 2016 WL 6820745 (S.D.N.Y. Nov. 10, 2016), aff'd sub nom. Luv N' Care, Ltd. v. Goldberg Cohen, LLP, 703 Fed.Appx. 26 (2d Cir. 2017).

         On August 19, 2016, Defendants filed a suit against LNC in the United States District Court for the Southern District of New York for breach of contract for unpaid attorney fees in the Jackel case. See Goldberg Cohen, LLP v. Luv N' Care, Ltd., et al., No. 1:16-cv-06576 (S.D.N.Y.). Defendants moved for partial summary judgment on their breach of contract claim, which was denied. See Goldberg Cohen, LLP v. Luv N' Care, Ltd., 2017 WL 3891688, at *1 (S.D.N.Y. Aug. 18, 2017). That action is still pending.

         On February 3, 2017, LNC asked Defendants to turn over their client file in the Jackel case to LNC or its new counsel. (Docs. 1, 6-1, 19-1). On February 10, 2017, Defendants expressly refused to turn over LNC's client file. (Docs. 1, 6-1, 19-1).

         On February 23, 2017, LNC filed a Rule to Show Cause against Defendants in the Jackel case, asking the state court to order Defendants to turn over LNC's client file to LNC's new counsel. (Docs. 6-4, 19-1, 21-1). A Rule to Show Cause was held in Jackel on April 19, 2017. (Docs. 6-1, 19-1, 21-1).

         On March 13, 2017, LNC sued Defendants (the two partners of Goldberg Cohen, L.L.P. (Doc. 6-1)) for legal malpractice in a separate suit brought in the Louisiana Fourth Judicial District Court, Luv N' Care, Ltd. v. Cohen and Goldberg, No. 17-0811. (Doc. 6-5). LNC alleges that Defendants failed to turn over LNC's client file after they were terminated as LNC attorneys. LNC seeks return of the Jackel file and related damages. (Doc. 6-5).

         Defendants removed LNC's state court legal malpractice case, No. 17-0811, to this Court on May 11, 2017. (Docs. 1, 6-7, 19). Defendants premised removal on diversity jurisdiction. (Doc. 1). Defendants also filed a “Notice” of its removal of the “related” action in the Jackel case. (Docs. 6-1, 19-1) Defendants then filed a Motion to Enjoin Related State Court Proceedings (Doc. 6). A Report and Recommendation has been issued recommending Defendants' Motion to Enjoin (Doc. 6) be denied. (Doc. 71).

         On May 31, 2017, the Louisiana Fourth District Court in Jackel signed an order, filed June 1, 2017, requiring Defendants to promptly release to LNC's attorney of record the entire file relating to Jackel. (Doc. 23-2). LNC filed a Motion for Contempt in Jackel on June 7, 2017, requesting a rule date claiming Defendants failed to comply with the order. (Doc. 23-3). The Louisiana Fourth Judicial District Court, in considering the pending federal action, withheld setting a rule date on LNC's Motion for Contempt, pending this Court's ruling on Defendants' Motion to Enjoin (Doc. 6).[2]

         In the instant suit, LNC filed a Motion to Remand and Motion for Attorney Fees arguing this Court lacks subject matter jurisdiction. (Doc. 10) A Report and Recommendation has been issued recommending the Motion to Remand (Doc. 10) be granted for lack ...


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