SUPREME COURT STATE OF FLORIDA

CHARLES KANE, HARLEY KANE, CASE NO.: SC12-1301 et al. L.T. CASE NO.: 4D08-4584

Petitioners, v.

STEWART TILGHMAN FOX & BIANCHI, P.A., et al.

Respondents. ______/

PETITIONER’S JURISDICTIONAL BRIEF BY CHARLES KANE, HARLEY KANE and KANE AND KANE FIRM

ON REVIEW FROM A DECISION OF THE FOURTH DISTRICT COURT OF APPEAL

CHARLES KANE MAJOR B. HARDING Florida Bar No.: 0093536 Fla. Bar No. 0033657 Kane & Kane, P.A. JOHN BERANEK 4800 N. Federal Hwy, Ste 101 E Fla. Bar No. 0005419 Boca Raton, FL 33431 Ausley & McMullen (561) 391-0303 - telephone 123 South Calhoun Street (561) 368-9919 - facsimile P.O. Box 391 (zip 32302) Tallahassee, Florida 32301 (850) 224-9115 – telephone (850) 222-7560 – facsimile

Attorneys for Respondent TABLE OF CONTENTS

TABLE OF AUTHORITIES...... ii

SUMMARY OF THE ARGUMENT...... 1

ISSUE...... 1

THE KANE V. STEWART DECISION OF THE FOURTH DISTRICT IS IN DIRECT CONFLICT WITH DECISIONS BY THIS COURT AND OTHER DISTRICT COURTS...... 1 SUMMARY, STATEMENT OF THE CASE AND FACTS AND ARGUMENT...... 1

Contracts Barred ...... 1 The Litigation Privilege Protected the Kanes...... 8 Set-Off Based on Another Defendant’s Payment...... 9 CONCLUSION...... 10

CERTIFICATE OF SERVICE...... 10

CERTIFICATE OF TYPE SIZE AND STYLE...... 11

i TABLE OF AUTHORITIES

CASES

Beary v. ING Life Insurance, 520 F.Supp.2d 356 (D. Conn. 2007) ...... 6 Diamond “S” Development Corp. v. Mercantile Bank, 989 So. 2d 696 (Fla. 1st DCA 2008) ...... 5 Echevarria, McCalla, Raymer, Barrett & Frappier v. Cole, 950 So. 2d 380 (Fla. 2007) ...... 8, 9 Engelke v. Athla-Tech Computer Systems, Inc., 982 So. 2d 3 (Fla. 2d DCA 2008) ...... 10 Fernandez v. Haber and Ganguzza, 30 So. 3d 644 (Fla. 3d DCA 2010) ...... 8 Jackson v. BellSouth Telecommunications, 372 F.3d 1250 (11th Cir. 2004) ...... 9 Kovtan v. Frederiksen, 449 So. 2d 1 (Fla. 2d DCA 1984) ...... 4, 5 Levin, Middlebrooks, Mabie, Thomas, Mayes and Mitchell, P.A. v. U.S. Fire Insurance Co., 639 So. 2d 606 (Fla. 1994) ...... 8, 9 May v. Sessums & Marson, P.A., 700 So. 2d 22 (Fla. 2d DCA 1997) ...... 6 Moynet v. Courtois, 8 So. 3d 377 (Fla. 3d DCA 2009) ...... 6

ii SUMMARY OF THE ARGUMENT

Conflicts result in jurisdiction before this Court under

Article V, Section 3(b)(3). ISSUE

THE KANE V. STEWART DECISION OF THE FOURTH DISTRICT IS IN DIRECT CONFLICT WITH DECISIONS BY THIS COURT AND OTHER DISTRICT COURTS.

SUMMARY, STATEMENT OF THE CASE AND FACTS AND ARGUMENT

Contracts Barred Unjust Enrichment

This appeal deals with a claim for $3 million in attorney’s

fees involving “multi-party joint representation agreements” among several law firms. Kane at 1113.1 This fee dispute grew

out of an underlying bad faith case against Progressive

Insurance Company which was never a party in this litigation.

The parties to the appeal are solely the law firms which represented the Goldcoast parties and which also represented

thousands of PIP claimants in separate cases being handled by

the PIP . The plaintiffs were the three Stewart law

firms. The defendants were the PIP attorneys, which included

the Kane law firm, the Watson law firm and a third law firm

which settled for over one million dollars paid to the

1 The decision is reported at 85 So. 3d 1112 and designated herein as Kane at ___. A copy is included in the appendix.

1 plaintiffs.2 Progressive Insurance Company settled the underlying bad faith cases and all of the underlying PIP cases for $14.5 million paid to the PIP attorneys with $1.75 million allotted to the bad faith cases. The attorneys then litigated the entitlement and amount of Stewart’s fees. Stewart asserted unjust enrichment and the defendants asserted the multiple contracts as defenses.

The defendant law firms had been handling thousands of PIP claims for medical providers against Progressive. These law

firms contracted with the Stewart attorneys to file bad faith cases against Progressive. The contracts stated Stewart would be entitled to no fees from any PIP settlement by the PIP attorneys. Stewart’s responsibilities were later enlarged by

to include an unsuccessful attempt at settling the approximately 1,600 separate PIP claims.

The Fourth District characterizes the $14.5 million payment

as a “secret” settlement but the balance of the opinion makes it

obvious that the Stewart attorneys were advised of the

settlement and a dispute arose as to how much attorney’s fees

should be paid to the Stewart attorneys.3

2 Stewart initially agreed this $1.13 million payment should have been a set-off but the Fourth District did not address the issue other than to recognize a payment had been made. 3 Although the opinion does not directly address it, the PIP lawyers advised Stewart of the settlement and held a meeting with him on the amount to be paid the Stewart firms. Obviously,

2 The opinion wrongfully condemns the Kane law firm for reaching a “secret” settlement. The settlement negotiations initially occurred over a weekend between the PIP lawyers and

Progressive in a negotiating session which the Stewart firms were not advised of. Later attempts at reaching an agreement as to the fees due the Stewart firms under the contracts were unsuccessful.

The trial court concluded that the Stewart attorneys were responsible for 50% of the $14.5 million settlement and awarded

Stewart almost $3 million which the Fourth District approved.

The opinion repeatedly states the case was based on “unjust enrichment” rather than contract. The Fourth District’s decision directly conflicts with cases from other district courts and from this Court. The Fourth District’s opinion makes it clear that this was a dispute among the various law firms over the attorney’s fees produced by this large and complex litigation and settlement of thousands of PIP cases and the bad faith claims. Stewart never sought to set aside the settlement.

The Fourth District’s opinion expressly recognizes that there were contracts on attorney’s fees between and among all of

no agreement was reached. The Stewart attorneys sued the PIP attorneys but did not sue for breach of the contracts. Stewart did assert a “benefit of the bargain” count which was denied by the trial judge for insufficient .

3 these law firms, characterizing these contracts as “multi-party

joint representation agreements” among the lawyers. The opinion

then states that the PIP attorneys received $10 million in fees

and the bad faith attorneys received only $420,000 in fees. The

opinion then inconsistently recognizes there was a partial settlement by another law firm but does not disclose the amount

of those fees paid to the plaintiff attorneys. These payments

($1.13 million) to Stewart were near $1,000 per hour for attorneys’ and paralegal fees.

The opinion cites Kovtan v. Frederiksen, 449 So. 2d 1 (Fla.

2d DCA 1984) for the principle asserted by defendants that the law will not imply a contract where an express contract exists concerning the same subject matter. However, the court refused to apply this general principle and specifically stated that the

“defendants’ contention that the plaintiff’s unjust enrichment claim was barred by an express contract” was rejected because

“there was no express contract addressing how the proceeds of a secret…settlement of both PIP and bad faith claims” would be allocated. (Kane at 1114). A conflict exists because the

Fourth District has misapplied the existing precedent on this issue. An express contract bars resort to unjust enrichment or other equitable relief and that express contract does not have to specifically bar the fee claim. In short, the contract does

4 not have to state that “unjust enrichment is a barred claim.”

Instead, if there is a contract in existence on the same subject

matter such as attorney fees then all other claims based on

unjust enrichment are barred. The numerous conflicting cases so

hold.

Kovtan v. Frederiksen, cited by the Fourth involved a

plaintiff suing for fees for his accounting services based on a

quasi-contract theory. The Second District rejected the

plaintiff’s claim as a matter of law and stated: It is well settled that the law will not imply a contract where an express contract exists concerning the same subject matter. Hazen v. Cobb, 96 Fla. 151, 117 So. 853 (1928); Williams v. Stewart, 424 So. 2d 204 (Fla. 2d DCA 1983); Poe v. of Levy, 411 So. 2d 253 (Fla. 4th DCA 1982); Tobin & Tobin Insurance Agency v. Zeskind, 315 So. 2d 518 (Fla. 3d DCA 1975); Solutec v. Young & Lawrence Associates, Inc., 243 So. 2d 605 (Fla. 4th DCA 1971). (emphasis supplied).

Thus, the Second District has specifically adopted Fourth

District case law on this precise subject. Conflict is clear

based upon the Second District’s Kovtan case and the cases cited therein. The words “same subject matter” have a much broader meaning than the Fourth District gave them. Further, in Diamond

“S” Development Corp. v. Mercantile Bank, 989 So. 2d 696 (Fla.

1st DCA 2008) the court stated: Florida courts have held that a plaintiff cannot pursue a quasi-contract claim for

5 unjust enrichment if an express contract exists concerning the same subject matter.

Moynet v. Courtois, 8 So. 3d 377 (Fla. 3d DCA 2009) is another decision in direct conflict. There the court held: With regard to the count of unjust enrichment, where there is an express contract between the parties, claims arising out of that contractual relationship will not support a claim for unjust enrichment.

Without question, these claims for fees based on unjust

enrichment arose out the “contractual relationship” between

these attorneys and the claims were barred as a matter of law.

Moynet specifically holds such a complaint for unjust enrichment

does not state a cause of action and must be dismissed. Moynet

at 380. Thus there is clear conflict.4

May v. Sessums & Marson, P.A., 700 So. 2d 22, 28 (Fla. 2d

DCA 1997), holds " relief...can not be

maintained...when the rights of the parties are described in a

written contract."

The Fourth District’s opinion inaccurately describes the

actual contracts between the parties. A written fee contract

4 Beary v. ING Life Insurance, 520 F.Supp.2d 356, 370-372 (D. Conn. 2007), provided detailed analysis of several of the above Florida cases holding a contract on the same subject matter bars quasi-contract relief. The decision noted Florida courts have been "emphatic" in holding the "same subject matter" has a very broad meaning in Florida case-law. Beary held the express contract need only concern the general “subject matter of the Plaintiff’s unjust enrichment claims.”

6 addressing global settlement and addition of new bad faith

claims was signed - Plaintiff’s Exhibit 7.

Florida case law is very specific in barring claims based

on “unjust enrichment” when there are written contracts

concerning the same general subject matter. Unjust enrichment

is repeatedly disallowed as a matter of law.

Every Goldcoast retainer agreement (Pl’s Exh. 7)

specifically addressed settlement of PIP claims by the defendants and excluded Stewart from compensation based on such

settlements. Kane’s Exhibit 8 was a letter written by Larry

Stewart where he agreed he would be entitled to no attorney’s

fee based on any PIP settlement by the Kanes.

The Fourth District apparently decided to excuse the

Stewart attorneys from the case-law prohibitions because it was

unhappy with the circumstance of the settlement. Even if the

settlement was done without Larry Stewart’s participation, the

case law barring unjust enrichment when there are written

contracts was still applicable and the resulting conflict

warrants review by this Court. Even if there were no specific contract provisions dealing with how the proceeds of the settlement were to be allocated this did not abrogate all of the

applicable contract provisions and the case-law barring these

unjust enrichment claims. Stewart could have sued for breach of

7 contract but did not do so. This case was based solely on

unjust enrichment. Conflict warrants jurisdiction. The Litigation Privilege Protected the Kanes

Conflict jurisdiction is also present on this ground. The

Kanes were engaged in litigation conduct when they settled their

hundreds of PIP cases and they were protected from all liability growing out of those settlements. In Fernandez v. Haber and

Ganguzza, 30 So. 3d 644 (Fla. 3d DCA 2010), the Ganguzza firm

filed a lis pendens that violated ethical rules. However, any

liability growing out of that filing was held immune and

privileged under Levin, Middlebrooks, Mabie, Thomas, Mayes and

Mitchell, P.A. v. U.S. Fire Insurance Co., 639 So. 2d 606, 607-

608 (Fla. 1994). Florida law is clear on this subject.

Echevarria, McCalla, Raymer, Barrett & Frappier v. Cole, 950 So.

2d 380 (Fla. 2007) expands the Levin case by holding that absolute immunity applies to any act occurring during the course

of a judicial proceeding including or statutory violations

so long as the act has some relation to the legal proceeding.

There is a direct conflict with the expanded privilege stated in

detail in Echevarria and in Ganguzza. There is simply no

exception to this rule based on the good or bad motives of the

parties.

8 Also of direct application is Jackson v. BellSouth

Telecommunications, 372 F.3d 1250 (11th Cir. 2004), in which the court interpreted Levin to include settlement negotiations.

Similar to this case, the plaintiffs in Jackson alleged that an

unfairly low settlement was negotiated that allowed counsel to

take too high a percentage of the settlement funds as fees. The

litigation privilege was held applicable and the defendants

prevailed.

On Kanes’ argument that the litigation privilege precluded

this unjust enrichment claim, the opinion holds only: “Under

the facts of this case, the litigation privilege does not

apply.” Kane at 1114. The Echevarria decision specifically and

directly holds that the litigation privilege applies in all

civil litigation. The settlement of these cases was litigation

conduct within these civil actions. Thus the Fourth District

has created conflict with this Court’s Echevarria decision. The

District Court has again attempted to create an exception to the

rule when an attorney engages in a secret settlement. The

Fourth District has chosen to disregard established law on the

litigation privilege again creating conflict. Set-Off Based on Another Defendant’s Payment

The opinion disallowed a set-off based on a “pretrial

settlement” by “another defendant law firm.” This ruling

9 conflicts with Engelke v. Athla-Tech Computer Systems, Inc., 982

So. 2d 3, 9 (Fla. 2d DCA 2008), holding that a double recovery

may not be allowed based on a plaintiff’s unjust enrichment

claim when the plaintiff has already been paid by another

defendant. This $1.13 million payment was actually made by the

several defendants and was to have been an agreed “set-off.”

The opinion as written conflicts with Engelke. CONCLUSION

Jurisdiction should be accepted and the case reviewed on

the merits. The Watson brief in SC12-1274 is adopted by

reference. CERTIFICATE OF SERVICE

I HEREBY CERTIFY that a copy of the foregoing has been

furnished by mail to the following this 11th day of July, 2012.

Christian D. Searcy Larry Stewart P.O. Drawer 3626 One Southeast Third Avenue West Palm Beach, FL 33409 Suite 3000 Miami, FL 33131

William C. Hearon Philip M. Burlington One Southeast Third Avenue 444 W. Railroad Ave., Ste. 430 Suite 3000 West Palm Beach, FL 33401 Miami, FL 33131

David B. Pakula 6840 Dykes Road Southwest Ranches, FL 33331

10 CERTIFICATE OF TYPE SIZE AND STYLE

This brief is typed using Courier New 12 point, a font which is not proportionately spaced.

/s/ Major Harding MAJOR HARDING Fla. Bar ID No.: 0033657 JOHN BERANEK Fla. Bar ID No.: 0005419 Ausley & McMullen Post Office Box 391 123 South Calhoun Street Tallahassee, Florida 32302 (850) 224-9115 (850) 222-7560 (facsimile) [email protected]

CHARLES J. KANE Florida Bar No.: 0093536 Kane & Kane, P.A. 4800 N. Federal Hwy, Ste 101 E Boca Raton, FL 33431 561-391-0303 561-368-9919 (facsimile) [email protected]

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