Duffy v. ASNY NY, LLC

Opinion

1 2 UNITED STATES DISTRICT COURT DISTRICT OF NEVADA 3 4 Honesto De La Cruz, et al., Case No. 2:21-cv-01680-CDS-DJA

5 Plaintiffs

Order Granting Unopposed Motion to 6 v. Withdraw as Counsel and Granting

Stipulation 7 ASNY NY, LLC, et al.,

[ECF Nos. 97, 106] 8 Defendants

9 10 Last month, I granted the plaintiffs’ unopposed motion for voluntary dismissal of 23 11 plaintiffs’ claims.1 ECF No. 100. I indicated that I was inclined to grant the motion of plaintiffs’ 12 counsel—the firm of Albright Stoddard Warnick & Albright (ASWA)—to withdraw from the 13 case, but I imposed two conditions. Id. I instructed that ASWA must provide contact 14 information for all remaining plaintiffs to the defendants and must file an amended complaint 15 excluding the now-dismissed plaintiffs. Id. Yesterday, the plaintiffs complied with both 16 conditions and filed a third-amended complaint (ECF No. 107), along with a joint stipulation 17 that ASWA complied with my prior order. ECF No. 106. 18 The plaintiffs represent that Square One Development Group, Inc.—a timeshare exit 19 company—had power of attorney over the plaintiffs and agreed to “be solely responsible to 20 ASWA for all costs and fees incurred in prosecuting the litigation.” ECF No. 97 at 4. The 21 agreement permits ASWA to terminate representation and withdraw as counsel for various 22 reasons, including Square One’s nonpayment. Id. As of April 2022, Square One ceased payment 23 to ASWA. Id. at 4–5. 24

25 1 Since then, I have granted the parties’ stipulations to dismiss the claims of four other plaintiffs— Terrance Emter, Mary Emter, Julie Hape, and Robbie Franklin. ECF Nos. 103, 105. As of now, eight 26 plaintiffs remain in this case: Honesto De La Cruz, Emily De La Cruz, William Fenrich, Suvaree Fenrich, Charmel Goodloe, Alondre Smith, Ronald Arnold, and Cynthia Arnold. ECF No. 107. 1 “Courts maintain the discretion to grant or deny a motion to withdraw as counsel.” 2 Williams v. County of Fresno, 562 F. Supp. 3d 1032, 1035 (E.D. Cal. 2021) (citing LaGrand v. Stewart, 3 133 F.3d 1253, 1269 (9th Cir. 1998)). In resolving such motions, “courts consider: (1) the reasons 4 why withdrawal is sought; (2) the prejudice withdrawal may cause to other litigants; (3) the 5 harm withdrawal might cause to the administration of justice; and (4) the degree to which 6 withdrawal will delay the resolution of the case.” Leatt Corp. v. Innovative Safety Tech., LLC, 2010 WL 7 444708, at *1 (S.D. Cal. Feb. 2, 2010) (citation omitted). The Nevada Rules of Professional 8 Conduct implicitly recognize nonpayment as a valid reason for counsel’s withdrawal. Nev. R. 9 Pro. Conduct 1.16(b)(6) (Counsel may withdraw if “[t]he representation will result in an 10 unreasonable financial burden on the lawyer or has been rendered unreasonably difficult by the 11 client[.]”). 12 Plaintiffs’ counsel, Mark Albright, signed an affidavit swearing that “Square One has not 13 paid the ASWA’s invoices since April of 2022” and that “ASWA remained involved in the case 14 for almost a year following nonpayment[.]” ECF No. 97 at 15–16. He further affirms that 15 continued representation of the remaining plaintiffs would amount to a financial hardship on 16 the firm. Id. at 16. And he attests that ASWA’s withdrawal will not have a material adverse effect 17 on the interests of the client because the case is still in its early stages. Id. The defendants do not 18 oppose ASWA’s motion. ECF No. 99. Good cause exists for ASWA to withdraw from this case, 19 so I grant its request. If desired, the remaining plaintiffs should obtain new counsel as soon as 20 practicable. 21 Conclusion 22 IT IS HEREBY ORDERED that ASWA’s motion to withdraw as counsel [ECF No. 97] is 23 GRANTED. The Clerk of Court is directed to TERMINATE as counsel for all remaining 24 plaintiffs these three attorneys: G. Mark Albright, Daniel Reed Ormsby, and Kyle Fenton. 25 IT IS FURTHER ORDERED that the parties’ stipulation that ASWA has complied with 26 my prior order [ECF No. 106] is GRANTED. 1 IT IS FURTHER ORDERED that plaintiffs’ counsel, Jorge L. Alvarez, must either file a stipulation to withdraw as counsel or show cause why he does not seek to withdraw by August 18, 2023.2 4 The remaining eight plaintiffs, their new counsel (if applicable), and all defendants are ordered to attend a status hearing on September 13, 2023, at 11:00 a.m. in Courtroom 6B of the 6|| Lloyd D. George Federal Courthouse in Las Vegas, Nevada. 7 DATED: August 10, 2023 /, / Li —— Crist} . Silva 9 Unie States District Judge 10 (

ll 12 13 14 15 16 17 18 19 20 21 22 23 24 He filed a motion to withdraw in March of this year. ECF No. 87. I denied it without prejudice because of the parties’ potential settlement agreement. ECF No. 95. If Alvarez seeks to withdraw, he must file a 26 joint stipulation—signed by himself and defense counsel—so that such request may be processed expediently and the plaintiffs can find new counsel, if necessary.