United States District Court, S.D. California
James B. Morris, Plaintiff,
Marco A. Torres, Defendant.
ORDER GRANTING MOTION TO DISMISS (DOC. NO.
ANTHONY J. BATTAGLIA UNITED STATES DISTRICT JUDGE
Marco Torres requests the Court dismiss plaintiff James
Morris's complaint because it is time-barred. (Doc. No.
3-1 at 2.) After two motion hearings and supplemental
briefing, it became clear that the core of Morris's claim
is his unhappiness with the fact that the $442, 000 in his
bankruptcy estate went to his ex-wife. Because Morris's
complaint suffers on many fronts, the Court GRANTS
Torres's dismissal motion and DISMISSES the complaint
complaint alleges legal malpractice against his former
bankruptcy attorney, Torres. (Doc. No. 1-2 at 12.) In April
2014, represented by Torres, Morris filed for Chapter 11
bankruptcy. (Id. ¶¶ 4, 5.) Morris claims
his Chapter 11 bankruptcy proceeding was involuntarily
converted into a Chapter 7 proceeding because Torres's
negligence and inaction prejudiced the trustee and the judge.
(Id. ¶¶ 6, 7.) This prejudice, Morris
states, “carried over to the Chapter 7 trustee . . .
who also saw plaintiff as the devil incarnate.”
(Id. ¶ 8.) In “mid-January 2015, ”
Morris hired new attorneys, who informed him that he
“might be facing criminal prosecution for bankruptcy
fraud as a result of the negligence by Defendant in his prior
representation of [Morris] during the first eight or so
months of the bankruptcy action.” (Id. ¶
8.) Morris's complaint states that because of
Torres's negligence, his bankruptcy proceeding worsened,
he was now facing criminal charges, and he was accused of
abusing the bankruptcy system-a theory Torres seemingly
encouraged. (Id. ¶¶ 9-11.) Torres also
failed to file necessary documents within the allotted time,
causing the trustee to file proceedings to begin the
conversion process. (Id. ¶¶ 12-13.) Torres
then failed to file any responsive briefs opposing the
conversion to Chapter 7. (Id. ¶ 14.) After the
bankruptcy proceeding was converted, Morris lost “$442,
000 in the trust fund to the Chapter 7 trustee and to
Plaintiff's ex-wife . . . .” (Id. ¶
17.) Morris sued Torres for legal malpractice and breach of
fiduciary duties requesting the $442, 000 he lost as well as
punitive damages under Cal. Civ. Code § 3294.
first motion hearing, Morris, represented at the time by
counsel, convinced the Court additional briefing was required
to discuss the statute of limitations and the trustee's
possible ownership of the malpractice claim. After
supplemental briefing, the Court held another motion hearing.
The arguments raised in supplemental briefing went beyond the
scope of the Court's limits. Nevertheless, the Court
entertained all issues raised in briefing and during the
hearing regardless of scope.
12(b)(6) motion to dismiss tests a complaint's legal
sufficiency. Fed.R.Civ.P. 12(b)(6). The Court must accept the
complaint's allegations as true and construe all
reasonable inferences in favor of the nonmoving party, but is
not required to accept “legal conclusions” as
true. Ashcroft v. Iqbal, 556 U.S. 662, 664 (2009);
Cahill v. Liberty Mut. Ins. Co., 80 F.3d 336, 337-38
(9th Cir. 1996). To avoid a dismissal at this stage, a
complaint must plead “enough facts to state a claim to
relief that is plausible on its face.” Bell Atl.
Corp. v. Twombly, 550 U.S. 544, 570 (2007); Fed.R.Civ.P.
8(a)(2) (stating a party's pleading must contain “a
short and plain statement of the claim showing that the
pleader is entitled to relief.”).
once opened a box and we all know how that story ended.
Although not quite as dramatic, this case represents the
be-careful-what-you-wish-for trope. After allowing
supplemental briefing, the issues in this case became only
muddier. While Torres argues dismissal is appropriate because
the complaint is time-barred, the Court also finds the
complaint fails to state a claim.
The Complaint Fails to State a Claim
Torres never raises this argument, the Court chooses to do so
sua sponte. “The elements of a cause of action for
attorney malpractice under California law are: (1) the duty
to use such skill, prudence and diligence as members of the
profession commonly possess; (2) breach of that duty; (3) a
proximate connection between the breach and the injury; and
(4) actual loss or damage.” Loyd v. Paine Webber,
Inc., 208 F.3d 755, 759 (9th Cir. 2000). After reviewing
the complaint, the dismissal motion briefing, the
supplemental briefing, and two hearings with Morris, the
Court finds the complaint fails to state a claim because it
does not allege causation or damages.
The Complaint Failed to Adequately Allege
adequately allege a malpractice claim, Torres's actions
must have been the substantial factor of the loss. Here,
admittedly, there are superseding intervening factors which
contributed to Morris's alleged injury. Looking at the
initially alleged timeline, Torres failed to file responsive
briefing which caused the bankruptcy court to convert his
proceeding from Chapter 11 to Chapter 7, resulting in
monetary loss. At first, it seemed to the Court that it was
the conversion that caused the loss and injury.
However, once Pandora's Box was opened, the facts became
clouded. During the second hearing, Morris walked the Court
through a new timeline where, after Torres's misstep, the
bankruptcy was converted, but that was not the loss. The
loss, Morris stated, was not the conversion (as he stated he
had lost control when he filed bankruptcy, it did not matter
to him which chapter it was under), but the loss was now
where the money went. Relying on this new theory,
however, Morris cannot prove causation because it was the
trustee's decision-and not Torres's-on what to do
with the $442, 000. Morris admits in his supplemental
briefing, “[n]obody knew, or could anybody have
possibly known, at the time of Chapter 7 conversion, what
action the Chapter 7 trustee would take in the future and
whether that action would actually injure Plaintiff.”
(Doc. No. 18 at 5.) Thus, the trustee's actions became
the superseding intervening cause between Torres's
initial negligence (causing the conversion) and the alleged
loss (the money going to Morris's ex-wife). As
Torres's counsel pointed out during the second hearing,
malpractice requires that different counsel could have
yielded a different result, but here, no attorney could have
controlled what the trustee did with the $442, 000. Thus,
Morris failed to plead causation.
The Complaint Failed to Adequately ...