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Brightwell v. Mcmillan Law Firm

United States District Court, S.D. California

May 2, 2017

L. LEE BRIGHTWELL, Plaintiff,
v.
THE MCMILLAN LAW FIRM, et al., Defendants.

          ORDER:(1) GRANTING IN PART AND DENYING IN PART DEFENDANTS' MOTION TO DISMISS [DOC. 18]; AND (2) GRANTING IN PART AND DENYING IN PART DEFENDANTS' MOTION TO STRIKE [DOC. 19]

          Hon. Thomas J. Whelan United States District Judge.

         Pending before the Court are (1) Defendants' Motion to Dismiss pursuant to Fed.R.Civ.P. 12(b)(6) [Doc. 18], and Defendants' Motion to Strike pursuant to Fed.R.Civ.P. 12(f). [Doc. 19.] The Court decides the matters on the papers submitted and without oral argument pursuant to Civil Local Rule 7.1(d)(1). For the reasons that follow, the Court GRANTS IN PART AND DENIES IN PART both motions.

         I. Background

         This is a legal malpractice case over which this Court has diversity jurisdiction pursuant to 28 U.S.C. § 1332. (First Amended Complaint (“FAC”) [Doc. 16].) It arises out of an underlying action that began in 2013. (Id. [Doc. 16] ¶ 8.) On June 30, 2016, Plaintiff filed the Complaint against the law firm that previously represented her, an attorney at that law firm, and that attorney's associate. (See Compl. [Doc. 1].)

         The First Amended Complaint (“FAC”) alleges that, on the eve of trial, Plaintiff's former counsel informed her of a lack of confidence in his own abilities as a result of a 2015 car accident that caused him to suffer a traumatic brain injury from which he was still recovering at the time. (See FAC [Doc. 16] ¶¶ 1-20.) As a result, Plaintiff alleges that “Defendants put great pressure on [her] to settle the [underlying action] for far less than the amount Defendants originally told [her] the case was worth.” (See Id. [Doc. 16] ¶ 20.) Further, the FAC alleges that Defendants unjustifiably inflated their legal bills and then threatened to withdraw during critical settlement negotiations when she did not pay them within eleven days. (See Id. [Doc. 16] ¶ 22.) According to the FAC, Defendants did, in fact, file a motion to withdraw with the Court during said settlement negotiations, which was granted. (Id. [Doc. 16] ¶¶ 26-27.) Plaintiff then hired a new attorney and settled the case several months later. (See Id. [Doc. 16] ¶¶ 28.) Thereafter, despite a voluntary withdrawal from the matter, Defendants allegedly billed Plaintiff based on their original contingency agreement-for a settlement they did not arrange. (See Id. [Doc. 16] ¶ 29.)

         The FAC asserts five causes of action: (1) breach of contract; (2) fraud; (3) professional negligence; (4) breach of fiduciary duty; and (5) declaratory relief. (FAC [Doc. 16].)

         II. Legal Standards A. Motion to Dismiss Pursuant to Fed.R.Civ.P. 12(b)(6)

         The Court must dismiss a cause of action for failure to state a claim upon which relief can be granted. Fed.R.Civ.P. 12(b)(6). A motion to dismiss under Rule 12(b)(6) tests the legal sufficiency of the complaint. See Parks Sch. of Bus., Inc. v. Symington, 51 F.3d 1480, 1484 (9th Cir. 1995). A complaint may be dismissed as a matter of law either for lack of a cognizable legal theory or for insufficient facts under a cognizable theory. Balistreri v. Pacifica Police Dep't., 901 F.2d 696, 699 (9th Cir. 1990). In ruling on the motion, a court must “accept all material allegations of fact as true and construe the complaint in a light most favorable to the non-moving party.” Vasquez v. L.A. Cnty., 487 F.3d 1246, 1249 (9th Cir. 2007).

         A complaint must contain “a short and plain statement of the claim showing that the pleader is entitled to relief[.]” Fed.R.Civ.P. 8(a)(2). The Supreme Court has interpreted this rule to mean that “[f]actual allegations must be enough to raise a right to relief above the speculative level[.]” Bell Atl. Corp. v. Twombly, 550 U.S. 544, 555 (2007). The allegations in the complaint must “contain sufficient factual matter, accepted as true, to ‘state a claim to relief that is plausible on its face.' ” Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009) (quoting Twombly, 550 U.S. at 570).

         Well-pled allegations in the complaint are assumed true, but a court is not required to accept legal conclusions couched as facts, unwarranted deductions, or unreasonable inferences. See Papasan v. Allain, 478 U.S. 265, 286 (1986); Sprewell v. Golden State Warriors, 266 F.3d 979, 988 (9th Cir. 2001).

         B. Motion to Strike Pursuant to Rule 12(f)

         Rule 12(f) allows a court to “strike from a pleading an insufficient defense or any redundant, immaterial, impertinent, or scandalous matter.” Fed.R.Civ.P. 12(f). “ ‘The function of a 12(f) motion to strike is to avoid the expenditure of time and money that must arise from litigating spurious issues by dispensing with those issues prior to trial . . ..' ” Whittlestone, Inc. v. Handi-Craft Co., 618 F.3d 970, 973 (9th Cir. 2010) (quoting Fantasy, Inc. v. Fogerty, 984 F.2d 1524, 1527 (9th Cir. 1993), overruled on other grounds by 510 U.S. 517 (1994)). Motions to strike are generally disfavored and are “usually . . . denied unless the allegations in the pleading have no possible relation to the controversy, and may cause prejudice to one of the parties.” See Travelers Cas. & Sur. Co. of Am. v. Dunmore, 2010 WL 5200940, at *3 (E.D. Cal. 2010).

         Redundant matter is the needless repetition of assertions. See Dunmore, 2010 WL 5200940, at *3. “ ‘Immaterial matter is that which has no essential or important relationship to the claim for relief or the defenses being plead.' ” Whittlestone, 618 F.3d at 974 (quoting Fogerty, 984 F.2d at 1527). “Impertinent matter consists of statements that do not pertain, and are not necessary, to the issues in question.” Id. (internal quotation omitted). “Scandalous matters are allegations that unnecessarily reflect . . . on the moral character of an individual or state . . . anything in repulsive language that detracts from the dignity of the court.” Consumer Soultions REO, LLC v. Hillery, 658 F.Supp.2d 1002, 1020 (N.D. Cal. 2009) (quoting Corbell v. Norton, 224 F.R.D. 1, 5 (D.D.C. 2004)).

         A court may not strike from the pleadings any disputed and substantial factual or legal issue. See Whittlestone, 618 F.3d at 973-74 (9th Cir. 2010). For the purpose of this inquiry, the Court construes the pleading in the light most favorable to the non-moving party. See id. at 975 n.2.

         III. Discussion

         A. Request for Judicial Notice

         Plaintiff requests judicial notice via two identical filings in connection with the instant motion to dismiss and motion to strike. (Request for Judicial Notice as to Motion to Dismiss [Doc. 18-2]; Request for Judicial Notice as to Motion to Strike [Doc. 19-2].)

         A court “may judicially notice a fact that is not subject to reasonable dispute because it . . . can be accurately and readily determined from sources whose accuracy cannot reasonably be questioned.” Fed.R.Evid. 201.

         “As a general rule, ‘a district court may not consider any material beyond the pleadings in ruling on a Rule 12(b)(6) motion.' ” Lee v. City of Los Angeles, 250 F.3d 668, 688 (9th Cir. 2001) (internal quotation omitted), overruled on other grounds as stated in Galbraith v. Cty. of Santa Clara, 307 F.3d 1119, 1125-26 (9th Cir. 2002). Matters of public record subject to judicial notice are an exception to this rule. See id. at 688-90. However, this exception may not exceed the outer bounds of Rule 201-it may not allow for the introduction or consideration of disputed facts, or facts that would contradict those alleged in the complaint. See id. at 690. Accordingly, “on a Rule 12(b)(6) motion to dismiss, when a court takes judicial notice of another court's opinion, it may do so ‘not for the truth of the facts recited therein, but for ...


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