Naegele v. Albers

958 F.Supp.2d 17

Timothy D. NAEGELE, Plaintiff,

v.Deanna J. ALBERS, et al., Defendants.

Civil Action No. 03–cv–2507 (RLW).

United States District Court, District of Columbia.

July 18, 2013.

Timothy D. Naegele, Malibu, CA, pro se.

Deanna J. Albers, Thousand Oaks, CA, pro se.

Raymond H. Albers, II, Thousand Oaks, CA, pro se.

Lloyd J. Michaelson, Westlake Village, CA, pro se.

MEMORANDUM OPINION

ROBERT L. WILKINS, District Judge.

This Court recently issued an Order to Show Cause directing Plaintiff Timothy Naegele (“Naegele”) to address two points. First, the Court ordered Naegele to respond to its belief that a stay of this action seemed appropriate in view of the parallel California litigation between Naegele and Defendants Deanna J. Albers and Raymond H. Albers II (collectively, “the Albers”), presently pending in the California Court of Appeal. And second, the Court directed Naegele to explain why the Court should not conclude that he “willfully fail[ed] to appear at the arbitration hearing” before the Los Angeles Bar Association's Dispute Resolution Services (“DRS”), within the meaning of California Business and Professions Code § 6204(a). See Naegele v. Albers, 940 F.Supp.2d 1, 2013 WL 1679957 (D.D.C. Apr. 18, 2013). Naegele timely responded on May 6, 2013 (Dkt. No. 115), the Albers submitted their views on or about June 5, 2013 (Dkt. No. 120), and Naegele thereafter replied on June 21, 2013 (Dkt. No. 121). The Court has reviewed the parties' respective submissions and has undertaken the unenviable task of familiarizing itself with the convoluted docket in this case, which reaches back nearly an entire decade to December 2003. At this point, the only pending motion before the Court is Naegele's Motion for Reconsideration, through which he asks the Court to consider his “Rejection of Arbitration Award and Motion for Trial.” Finding that Naegele willfully failed to appear at the mandatory fee arbitration, the Court rules that he is not entitled to a trial de novo under § 6204, and that his Motion for Reconsideration (Dkt. No. 110)—and, in turn, his “Rejection of Arbitration Award and Request for Trial” (Dkt. No. 64)—must be DENIED. With that issue decided, the Court concludes that this action shall be STAYED in its entirety pending the final resolution of the ongoing litigation in California between Naegele and the Albers.

BACKGROUND

The Court summarized the general backdrop of this litigation in its prior Opinion and finds no occasion to recount the case's tortured history afresh. Instead, the Court presumes familiarity with the case, setting forth only those facts bearing on the Court's findings as to Naegele's non-appearance at the mandatory fee arbitration initiated by the Albers.

Naegele, an attorney, previously represented the Albers in a lawsuit he prosecuted on their behalf in the U.S. District Court for the Central District of California and, later, on appeal to the U.S. Court of Appeals for the Ninth Circuit. Thereafter, the Albers apparently disagreed with the appropriateness of Naegele's legal fees and, pursuant to California's Mandatory Fee Arbitration Act (“MFAA”), Cal. Bus. & Prof.Code §§ 6200 et seq.,¹ they invoked their statutory right to mandatory fee arbitration with DRS. Naegele, it seems, had other plans.

The Albers were represented in the fee arbitration by attorney Lloyd Michaelson (“Michaelson”)—who, as it happens, also found himself entangled as a defendant in this action at one point.² Michaelson notified Naegele of the Albers' intention to proceed with mandatory fee arbitration via letter dated August 28, 2003. ( See Dkt. No. 120 at ECF pp. 15–16) (“[T]his correspondence is intended to place you on notice of the Albers['] intent to pursue their rights under the State Bar's Mandatory Fee Arbitration Program.”). On September 4, 2003, Naegele's attorney, Lawrence Strauss, responded to Michaelson via letter, essentially disputing the Albers' ability to pursue fee arbitration under the MFAA; instead, Mr. Strauss emphasized the venue selection clauses included in various written fee agreements between Naegele and the Albers, directing that any disputes shall be litigated in the District of Columbia. ( See id. at ECF pp. 18–19). Thereafter, on October 3, 2003, Naegele emailed the Albers directly and acknowledged receipt of Michaelson's letter, although he avoided mentioning (perhaps strategically) the Albers' impending fee arbitration. ( See id. at ECF p. 43).

Naegele does not dispute this chain of events whatsoever. Instead, he coyly attempts to justify his actions by asserting that “[t]he first time [he] received a letter from the Los Angeles County Bar Association's Dispute Resolution Services—which is responsible for commencing or initiating the arbitration process—was on December 23, 2003, after the instant lawsuit had been filed.” (Dkt. No. 115 at ECF p. 117 ¶ 4). This may be true, but in the Court's view, Naegele's carefully-crafted assertion misses the bigger picture. Even if the Albers' fee arbitration had not officially “commenced,” as Naegele seems to suggest, he knew full well that they were in the process of asserting their rights under the MFAA. He proceeded to file this lawsuit anyway, presumably in an effort to win the proverbial “race to the courthouse.” ³ To make matters worse, even as the Albers subsequently struggled to preserve their MFAA rights by filing notices of stay in the instant action, Naegele's contumacious conduct continued. Naegele moved to strike the Albers' stay notices, he sought the entry of default against the Albers (and Michaelson), he moved for Rule 11 sanctions against both the Albers (and Michaelson), and more, until Judge Urbina ultimately stayed this action for the first time on January 3, 2005.

Meanwhile, Naegele's “participation” in the DSR arbitration proceedings was no more commendable. Upon being formally notified of the arbitration proceedings, Naegele objected to the “jurisdiction” of DRS over his fee dispute with the Albers, relying on the above-referenced venue selection clauses. ( See, e.g., Dkt. No. 8–1). In response, both the Deputy Chair and the Chair of the L.A. County Bar Association's Attorney–Client Mediation and Arbitration Services reviewed and overruled Naegele's objections, concluding that DRS did, in fact, possess jurisdiction over the fee dispute under the MFAA. ( See Dkt. Nos. 56–6, 56–7).⁴ Despite these findings, Naegele's defiance of the arbitration proceedings persisted. Naegele submitted a “Memorandum Regarding the Absence of Jurisdiction” to the arbitration panel on April 29, 2004, continuing to contest DRS's jurisdiction. ( SeeDkt. No. 115 at ECF pp. 122–129). Moreover, according to Michaelson's sworn affidavit, the Albers requested in discovery a copy of Naegele's litigation file covering the Albers' case, but Naegele never produced that file, even after the Albers filed a motion to compel and secured an order from the arbitration panel directing Naegele to comply. ( See Dkt. No. 120 at ECF p. 12 ¶ 4). Naegele does not dispute these assertions.

Most significantly, Naegele failed to appear for the arbitration hearing on November 17, 2004. While Naegele's attorney, Mr. Strauss, appeared, Naegele was nowhere to be found, effectively precluding both the Albers ( vis-à-vis Michaelson) and the arbitration panel from examining or questioning him during the hearing. Instead, Naegele prepared a “written statement for the record” continuing to contest the panel's jurisdiction and indicating, inter alia, that he would “consider responding only in writing to questions submitted by [the arbitration panel] or anyone else.” (Dkt. No. 120 at ECF p. 33 ¶ I.D).

The arbitration panel subsequently rendered its award on January 14, 2005. ( See Dkt. No. 92–3). In addition to finding in the Albers' favor, the panel separately found that Naegele “willfully failed to appear at the hearing for non-binding arbitration and produce documents as required under the Rules, and should not be entitled to a new trial after arbitration pursuant to Rule 40 of the Rules For Conduct of Arbitration of Fee Disputes and Other Related Matters for the Los Angeles County Bar Association Dispute Resolution Services, Inc.” ( Id. at ECF p. 25). The arbitration panel made other express findings to this effect, as well:

[T]he conduct of Naegele upon learning of the decision of John S. Chang, Presiding Arbitrator for the State Bar of California Office of Mandatory Fee Arbitration, that this panel did have jurisdiction to adjudicate the fee dispute between Albers and Naegele, in not appearing as he was compelled to do, and in refusing to produce the Albers' file as he was required to do by Business and Professions Code 6200 applicable to the arbitration hearing, was willful.

( Id. at ECF p. 24). Before rendering its willfulness finding, it appears the panel offered Naegele a chance to explain why his non-appearance at the hearing should not be construed as willful, and Mr. Strauss sent a response on November 22, 2004, claiming that “[a]ny suggestion that Mr. Naegele willfully failed to appear is untrue.” (Dkt. No. 115 at ECF p. 111). As set forth therein, Naegele justified his non-appearance as follows:

Because [the panel] [did] not have jurisdiction to decide [the] case, the Notice to Appear and Produce Documents was properly objected to and not acted upon by Mr. Michaelson, and the basic requirements of due process [had] been denied to [Naegele], there was no reason for Mr. Naegele to attend and he acted on the advice of counsel. Thus, it is indisputable that he did not willfully fail to appear.

( Id. at ECF p. 112). The panel, much like this Court, was unconvinced.

Following issuance of the arbitration award, Naegele filed a “Rejection of Arbitration Award and Request for Trial” in this Court on February 22, 2005, invoking § 6204.⁵ (Dkt. No. 64). Judge Urbina initially denied Naegele's “Request for Trial” without prejudice on August 8, 2005, and...