Beyond Systems, Inc. v. Kraft Foods, Inc. et al

MOTION to Withdraw as Attorney

D. Md.January 22, 2010

IN THE UNITED STATES DISTRICT COURT FOR THE DISTRICT OF MARYLAND BEYOND SYSTEMS, INC. Plaintiff, v. KRAFT FOODS, INC., et al., Defendants. : : : : : : : : : : : : Case No. 8:08-CV-00409-PJM The Honorable Peter J. Messitte Magistrate Judge Charles B. Day MOTION TO WITHDRAW APPEARANCE AS COUNSEL OF RECORD FOR HYDRA LLC Pursuant to Local Rules 101(2)(b) and 704, and Maryland Rule of Professional Conduct 1.16, Venable LLP (“Venable”) seeks leave to withdraw its appearance as counsel of record for Defendant and Third-Party Plaintiff Hydra LLC (“Hydra”). Good cause exists to grant the requested relief because Hydra “fail[ed] substantially to fulfill an obligation” to Venable by breaching its contractual obligation to pay Venable for legal services it provided to Hydra. See Maryland Rule of Professional Conduct 1.16(b)(5). For these reasons and as more fully explained in the memorandum of law below, Venable requests that this Court enter an order allowing it to withdraw as counsel of record for Hydra. Venable files the required Local Rule 101(2)(b) Certification herewith. MEMORANDUM OF LAW Since the inception of this litigation in February 2008, Venable has represented Hydra pursuant to a retainer agreement that required Hydra to pay Venable for legal services Venable provided and costs Venable incurred on Hydra’s behalf. After Hydra fell behind in its payment obligations, Venable contacted Hydra in December 2009 and was told, for the first time, that a Case 8:08-cv-00409-PJM Document 280 Filed 01/22/10 Page 1 of 4 2 California state court judge appointed a receiver for Hydra pursuant to a Stipulation for Appointment of Receiver and Preliminary Injunction in Aid of Receiver filed by and agreed upon by one of Hydra’s members (a living trust of which Hydra’s Chief Executive Officer Zac Brandenberg is the trustee) and Hydra itself. Venable then learned through counsel for the receiver that the court ordered the sale of all of Hydra’s assets to a new company formed by Brandenberg named Hydra Group LLC, f/k/a Marlboro Investment Group, and that the new company would not assume any debt owed to Venable. Counsel for the receiver then confirmed that Hydra has no assets. Local Rule 704 states that “This Court shall apply the Rules of Professional Conduct as they have been adopted by the Maryland Court of Appeals.” In turn, Maryland Rule of Professional Conduct 1.16(b)(5) states that “a lawyer may withdraw from representing a client if the client fails substantially to fulfill an obligation to the lawyer regarding the lawyer’s services and has been given reasonable warning that the lawyer will withdraw unless the obligation is fulfilled.” Comment 8 to this rule provides that “A lawyer may withdraw if the client refuses to abide by the terms of an agreement relating to the representation, such as an agreement concerning fees or court costs or an agreement limiting the objectives of the representation.” Here, Hydra “fail[ed] substantially to fulfill an obligation to the lawyer regarding the lawyer’s services” within the meaning of Maryland Rule of Professional Conduct 1.16(b)(5) by breaching its obligation to pay Venable $486,531.72 for services provided and costs incurred by Hydra concerning this litigation. Local Rule 101(2)(b) provides in relevant part that the Court may grant a motion to withdraw a lawyer’s appearance if “withdrawing counsel files a certificate stating (a) the name and last known address of the client, and (b) that the written notice has been mailed to or Case 8:08-cv-00409-PJM Document 280 Filed 01/22/10 Page 2 of 4 3 otherwise served upon the client at least seven (7) days previously advising the client of counsel’s proposed withdrawal and notifying it that it must have new counsel enter an appearance or be subject to the dismissal of its claims and/or default judgment on claims against it.” Here, Venable provided “reasonable warning” by serving upon Hydra the written notice, attached hereto as Exhibit A, seven days before filing this motion indicating that Venable will withdraw unless Hydra fulfills its obligation to pay Venable’s invoices in full. See also Local Rule 101(2)(b) (requiring service of notice of intent to withdraw seven days before filing motion to withdraw). For these reasons, Venable requests that the Court enter an order allowing it to withdraw its appearance as counsel of record for Hydra. Respectfully submitted, Dated: January 22, 2010 /s/ J. Douglas Baldridge, US DC-MD Bar No. 11023 Lisa Jose Fales, US DC-MD Bar No. 08141 Ari N. Rothman, US DC-MD Bar No. 17560 Robert A. Friedman, US DC-MD Bar No. 28864 VENABLE LLP 575 7th Street, N.W. Washington, DC 20004-1601 (202) 344-4000 (phone) (202) 344-8300 (fax) jdbaldridge@venable.com ljfales@venable.com anrothman@venable.com Case 8:08-cv-00409-PJM Document 280 Filed 01/22/10 Page 3 of 4 CERTIFICATE OF SERVICE I HEREBY CERTIFY that on this 22nd day of January 2010, a copy of the foregoing Motion to Withdraw Appearance as Counsel of Record for Hydra LLC was filed electronically in accordance with the Court’s CM/ECF procedures, and served upon the below-named counsel via the Court’s electronic filing notification system: Thomas M. Barba John J. Duffy Jennie L. Kneedler STEPTOE & JOHNSON LLP 1330 Connecticut Ave NW Washington DC 20036 tbarba@steptoe.com jduffy@steptoe.com jkneedler@steptoe.com Anthony A. Onorato STEPTOE & JOHNSON LLP 750 Seventh Ave., Ste. 1800 New York, NY 10019 tonorato@steptoe.com Stephen H. Ring Law Offices of Stephen H. Ring, P. C. 20300 Seneca Meadows Parkway, Suite 200 Germantown MD 20876 shr@ringlaw.us Mike Rothman Law Office of Michael S. Rothman 401 E. Jefferson Street, Suite 201 Rockville MD 20850 mike@mikerothman.com Counsel for Plaintiff Beyond Systems, Inc. John K. Roche Barry J. Reingold John M. Devaney PERKINS COIE LLP 607 14th Street NW, Suite 800 Washington DC 20005-2003 jroche@perkinscoie.com breingold@perkinscoie.com jdevaney@perkinscoie.com Darrell J. Graham THE LAW OFFICE OF DARRELL J. GRAHAM, LLC 53 W. Jackson Blvd. Suite 1334 Chicago, IL 60604 dgraham@djgrahamlaw.com Counsel for Defendants Kraft Foods Inc. & Vict. Th. Engwall & Co. /s/ Ari N. Rothman Case 8:08-cv-00409-PJM Document 280 Filed 01/22/10 Page 4 of 4