9/11 Fee Fight Litigation May Proceed

The United States District Court for the District of Columbia (judge Randolph Moss) granted and denied in part a motion to dismiss claims

In this breach of contract action, Plaintiff John M. Quinn (“Quinn”) alleges that Defendants Kreindler & Kreindler, LLP and James P. Kreindler (collectively, “K&K”) have failed to pay him the compensation that he is due for assisting with K&K’s representation of family members and representatives of the victims of the September 11, 2001 terrorist attacks. Quinn alleges that he was engaged to assist K&K in obtaining compensation for K&K’s clients by, among other things, helping to remove barriers posed by foreign sovereign immunity to the K&K plaintiffs’ ability to recover damages from “the Kingdom of Saudi Arabia and other nation states,” Dkt. 19 at 5-6 (Am. Compl. ¶ 19); ensuring that K&K’s clients would have access to the Victims of State Sponsored Terrorism Fund (“VSSTF”), id. at 13 (Am. Compl. ¶ 45); and resisting “efforts on the part of the Government of Sudan and the Department of State to . . . include[] in the Sudan Claims Resolution Act . . . language that would [have] effectively erase[d] the 9/11 families’ claims against Sudan,” id. at 13 (Am. Compl. ¶ 44).

The parties’ agreements regarding what Quinn characterizes as “eight years [spent] laboring on legal, political and media activities,” id. at 10 (Am. Compl. ¶ 38), are remarkably scant. Their first agreement, which they entered in June 2013, barely occupies half a page and is four sentences long. Dkt. 19-1 at 2 (Am. Compl. Ex. 1). Roughly a year later, they entered into a second agreement, which is a comparatively robust six sentences long. Dkt. 19-2 at 2 (Am. Compl. Ex. 2). Those agreements were superseded by two agreements in May 2017, one of which governs services rendered to K&K relating to the firm’s representation of clients who had “filed cases in the litigation as of” July 10, 2014, Dkt. 19-3 at 2 (Am. Compl. Ex. 3), and one of which governs services rendered to K&K relating to the firm’s representation of clients who “filed claims on or after July 10, 2014 or with respect to” certain other claims or proceedings, Dkt. 19-4 at 2 (Am. Compl. Ex. 4). Finally, in August 2017, the parties amended the May 2017 agreements by, among other things, providing that Quinn is entitled to compensation relating to recoveries by those K&K clients who filed claims and by those who did “not file[] [claims] in the litigation but who have retained K&K to assist in recovering compensation whether through the filing of claims or otherwise and who in fact receive a recovery.” Dkt. 19-5 at 2 (Am. Compl. Ex. 5).

The crux of the dispute between Quinn and K&K, at least at this point, is one of timing. K&K does not dispute that Quinn is entitled to compensation for the services he provided, but it maintains that Quinn’s demand for payment is premature because each iteration of the retainer agreement bases Quinn’s compensation on the “net recovery” that K&K receives, and because the 9/11 litigation is ongoing and K&K thus continues to accrue costs, rendering the amount of its “net recovery” inchoate. Dkt. 21-1 at 6. Quinn disagrees and maintains that K&K has received fees for portions of its work, and it is obligated to share those fees with him. Dkt. 22 at 5.

Quinn’s complaint contains six counts: (I) Breach of Contract – 2013/2014 Agreements; (II) Breach of Contract – 2017 Agreements; (III) Breach of Duty of Good Faith and Fair Dealing; (IV) Accounting; (V) Quantum Meruit; and (VI) Constructive Trust. See Dkt. 19 (Am. Compl.). K&K moves to dismiss all but Claim II, which it concedes survives the motion to dismiss stage. See Dkt. 21-1 at 7-8. Quinn opposes the motion to dismiss in its entirety. Dkt. 22 at 9. For the reasons explained below, the Court is unpersuaded by K&K’s arguments respecting Counts I, III, and V, but is persuaded by its arguments respecting Counts IV and VI.

The Court will, accordingly, GRANT in part and DENY in part Defendants’ Motion to Partially Dismiss the First Amended Complaint.

The litigation involves legal fees arising from the September 11 attacks

On September 11, 2001, al-Qaeda launched a series of coordinated terrorist attacks on the United States. Dkt. 19 at 4 (Am. Compl. ¶ 13). The attacks “immediately resulted in 2,977 fatalities and, to date, tens of thousands of injuries.” Id. at 5 (Am. Compl. ¶ 14). K&K represents family members whose relatives were killed or injured in these attacks, the estates of the deceased, and first responders and others who were injured. Id. at 5 (Am. Compl. ¶ 15). As part of this effort, K&K has served as counsel for a large group of plaintiffs in the consolidated multi-district litigation in the Southern District of New York for almost two decades. See In re: Terrorist Attacks on Sept. 11, 2001, 392 F. Supp. 2d 539, 546 (S.D.N.Y. 2005); Dkt. 19 at 7, 15-17 (Am. Compl. ¶¶ 24, 51-69)

The plaintiffs in the 9/11 litigation faced significant legal hurdles, including the doctrine of sovereign immunity, which, at the time of the attacks, barred suits against foreign nations that were not “‘state sponsors’ of terrorism.” Dkt. 19 at 5 (Am. Compl. ¶ 17). To help address some of these legal issues, K&K sought Quinn’s assistance. Id. at 6 (Am. Compl. ¶ 21). Quinn is a D.C. resident and attorney whose career has spanned government, private practice, and public affairs work. Id. at 3-4 (Am. Compl. ¶ 10).

(Mike Frisch)