A fee dispute between Thompson Hine and a former client posed a geographical conundrum: if the Florida-based former client didn’t pay the Ohio-based law firm for work in Oregon, and lawyers in Atlanta and the District of Columbia were involved, where should the firm sue?
The U.S. Court of Appeals for the D.C. Circuit said Tuesday that the District of Columbia was not an option. A three-judge panel affirmed a Washington federal trial judge’s dismissal of the case for lack of jurisdiction, finding the firm failed to show the fee dispute had enough ties to the city.
Thompson Hine accused former client Smoking Everywhere Inc., a now-bankrupt distributor of electronic cigarettes, and president and chief executive officer Elicko Taieb of failing to pay nearly $500,000 in legal fees. D.C. Circuit Judge David Tatel, writing for the court, said the involvement of D.C.-based lawyers from Thompson Hine wasn’t enough to establish jurisdiction.
Thompson Hine partner Thomas Feher argued for the firm. “While we respectfully disagree with the Court’s ruling on this jurisdictional issue, it does not impact the merits of our claim,” the firm said in a written statement.
Taieb’s lawyer, Levi Zaslow of Joseph, Greenwald & Laake in Greenbelt, Md., said the D.C. Circuit “respected constitutionally protected due process rights.”
“Nonresident cannot be haled into court without sufficient contacts,” Zaslow said. “Firms and businesses have to establish deliberate contacts [with the district] … none of which were present here.”
Smoking Everywhere hired Thompson Hine to challenge efforts by the U.S. Food and Drug Administration to restrict the import of e-cigarettes. The firm represented the company and Taieb in a related matter in Oregon.
In November 2010, Thompson Hine sued Taieb and his company in the U.S. District Court for the District of Columbia, claiming they failed to pay $480,745 in legal fees for the firm’s work on the FDA and Oregon matters.
Smoking Everywhere and Taieb asked the trial judge to dismiss the case, saying the dispute had too few ties to the District of Columbia.
U.S. District Judge Amy Berman Jackson agreed, dismissing the case in January 2012. Thompson Hine appealed. Smoking Everywhere went bankrupt during the litigation, meaning the case proceeded against Taieb alone.
The fact that Taieb hired D.C.-based lawyers wasn’t enough to meet the court’s standard for proving “minimum contacts” with the District, Tatel wrote.
“A non-resident’s mere retention of a D.C.-based service provider, absent any other deliberate contact with the forum—demonstrated either by the terms of the contract itself or by the non-resident’s actual dealings with the District—cannot qualify as a ‘minimum contact,’ ” Tatel wrote.
Judge Judith Rogers and Senior Judge David Sentelle also heard the case.
Contact Zoe Tillman at firstname.lastname@example.org.