Stanz v. Brown

Opinion

1 2 3 4 5 6 7 8 UNITED STATES DISTRICT COURT 9 SOUTHERN DISTRICT OF CALIFORNIA 10 11 AARON STANZ, individually and Case No. 3:22-CV-01164-GPC-JLB derivatively on behalf of Jet Genius 12 Holdings, Inc., ORDER GRANTING 13 WITHDRAWAL OF COUNSEL AND Plaintiff, DENYING MOTION TO 14 v. DISQUALIFY COUNSEL AS MOOT 15 JORDAN BROWN et al., [ECF Nos. 179, 171] 16 and 17 18 JET GENIUS HOLDINGS, INC., 19 Defendants. 20 21 On December 12, 2024, Higgs Fletcher & Mack, LLP and all attorneys associated 22 with it including Nicholas D. Brauns and Edwin M. Boniske (“Movant”) filed an ex parte 23 motion to withdraw from representation of Defendants Jordan Brown, Jet Genius 24 Holdings, Inc., Jet Genius Florida Holdings, Inc., C3 Jets LLC, C3 Limo LLC, Jet 25 Agency Global, LLC, and Bowman Aviation, Inc. (“Defendants”) and to substitute 26 Defendant Jordan Brown pro se. ECF No. 179 (“Mot.”). For the reasons set forth below, 27 1 the Court GRANTS the motion to withdraw and ORDERS that corporate Defendants 2 obtain new counsel within 45 days of the filling of this Order. 3 BACKGROUND 4 On December 12, 2024, Counsel moved to withdraw as counsel on the grounds 5 that Defendants have not met the material terms of the engagement agreement by which 6 they engaged Movant for legal services. ECF No. 179. According to Movant, good 7 cause for withdrawal exists because Defendants have failed to pay their legal fees. Id. 8 Furthermore, Movant states that the withdrawal would not prejudice the other litigants, 9 the administration of justice, or the resolution of the case because the case is still in 10 discovery. See Mot. at 6, Brauns Decl. ¶ 4 (attesting that, at that point in time, no 11 depositions have taken place or are even scheduled). 12 Movant advised Defendants and Plaintiff’s Counsel that it would be making an ex 13 parte request to withdraw as counsel for Defendants, thereby complying with Civ.L.R. 14 83.3(g)(2), see Mot. at 5, Brauns Decl. ¶ 7. Movant also notified the business-entity 15 defendants that they cannot proceed without counsel in this action. Mot., Brauns Decl. ¶ 16 5. Neither Plaintiff nor Defendants have opposed this request. 17 On January 7, 2025, the Court directed Defendants to file, within a week, a 18 response to the motion to withdraw. ECF No. 186. Defendants never responded. On 19 January 17, 2025, Mr. Brauns filed a declaration attesting that he forwarded the Court’s 20 Order to Defendants and that he reminded Defendants twice of the Order via email. ECF 21 No. 194. 22 LEGAL STANDARD 23 “An attorney may not withdraw as counsel except by leave of court, and the 24 decision to grant or deny counsel's motion to withdraw is committed to the discretion of 25 the trial court.” Beard v. Shuttermart of Cal., Inc., No. 07–CV–594–WQH (NLS), 2008 26 WL 410694, at *2 (S.D.Cal. Feb.13, 2008) (internal quotation marks and citations 27 1 omitted); see also Civ. L.R. 83.3(g)(3). In ruling on a motion to withdraw as counsel, 2 courts consider: (1) the reasons why withdrawal is sought; (2) the prejudice withdrawal 3 may cause to other litigants; (3) the harm withdrawal might cause to the administration of 4 justice; and (4) the degree to which withdrawal will delay the resolution of the 5 case. Beard, 2008 WL 410694, at *2 (citations omitted). 6 The ABA’s Model Rules of Professional Conduct1 permit a lawyer to withdrawal 7 as counsel if the client breaches a material term of an agreement with the lawyer, and the 8 lawyer has given reasonable warning after the breach that the lawyer will withdraw 9 unless the client fulfills the obligation, Model Rules of Prof. Conduct. R. 1.16(b)(5). 10 DISCUSSION 11 The Court finds that good cause exists to grant the motion to withdraw as counsel. 12 “Failure to pay attorney's fees can be a valid ground for withdrawal.” Leatt Corp. v. 13 Inn've Safety Tech., LLC, No. 09-CV-1301, 2010 WL 444708, at *2 (S.D. Cal, Feb. 2, 14 2010); see Model Rules of Prof. Conduct R. 1.16(b)(5). Movant has given Defendants 15 sufficient notice that it would withdraw from representation unless Defendants fulfilled 16 their obligations under the engagement agreement. See Mot. at 5, Brauns Decl. ¶ 3. 17 Furthermore, it does not appear that Counsel’s withdrawal would unduly prejudice 18 the parties, harm the administration of justice, or unduly delay the resolution of this case. 19 See In re Saber, No. 21-55913, 2022 WL 11592836, at *1 (9th Cir. Oct. 20, 2022). A 20 Final Pretrial Conference is set for June 27, 2025. See ECF No. 138. Given this date, 21 22 1 The Court looks to the ABA’s Model Rules of Professional Conduct because in a 23 federal proceeding, a lawyer’s conduct is governed by the ethical rules of the relevant 24 court, see In re Snyder, 472 U.S. 634, 645 n.6 (1985), and the Civil Local Rules no longer require attorneys practicing before the Southern District of California to comply with the 25 standards of professional conduct required by the State Bar of California. See generally 26 Suarez v. Del Toro, No. 22-cv-0021-GPC-BLM, 2023 WL 149105 (S.D. Cal. Jan. 10, 2023). 27 1 || there is sufficient time for new counsel to be hired and then familiarized with the case 2 || without unduly delaying proceedings or prejudicing Defendants. Cf In re Saber, 2022 3 || WL 11592836, at *1 (9th Cir. Oct. 20, 2022) (affirming lower court’s denial of 4 || withdrawal less than a week before an evidentiary hearing). Although discovery is well 5 its way,” Defendants’ lack of response to the Motion suggests that there is no great 6 || danger of prejudice to their interests. Although corporate defendants cannot proceed in 7 || propria persona, see In re Am. West Airlines, 40 F.3d 1058, 1059 (9th Cir. 1994) (per 8 curiam), the Court will provide Defendants ample opportunity to retain new counsel. 9 For the foregoing reasons, the Court finds that voluntary withdrawal is warranted 10 GRANTS the Counsel’s motion to withdraw and ORDERS that corporate 11 || Defendants obtain new counsel within 45 days of the filling of this Order. 12 As such, the Court DENIES Plaintiff’s Motion to Disqualify Counsel, ECF No. 13 || 171, as moot and vacates the hearing for this matter on February 7, 2025. 14 IT IS SO ORDERED. 15 Dated: February 5, 2025 2 << 16 Hon. athe Ck 17 United States District Judge 18 19 20 21 22 23 24 95 > Mr. Brauns’s declaration attested that, at the time he signed the statement, no depositions had been conducted or scheduled. Mot. at 6, Brauns Decl. 4 4. That was on 26 December 12, 2024. However, it is clear from the docket that there was a fact discovery cutoff on January 31, 2025. ECF No. 185. 28 22-CV-01164-GPC-JLB