Bain v. Gary, Williams, Parenti, Watson & Gary, P. L. ( 2022 )

 of any one of these failures, or all the failures together, would have changed the outcome of her
original lawsuit.
The Gary defendants moved for summary judgment on the required causation element of
legal malpractice. They argue that, even absent their alleged malpractice, Ms. Bain would have
lost her original lawsuit and that they are consequently not liable for its dismissal. After
considering the record, the applicable law, and the parties' briefing, this Court agrees with the
Gary defendants and will therefore GRANT the Gary defendants' motion for summary judgment
and DISMISS WITH PREJUDICE Ms. Bain's present lawsuit.
I. BACKGROUND
Much of the background of this case was previously explained in the Court's decision on
the Gary defendants' motion to dismiss, Bain v. Gary, Williams, Parenti, Watson & Gary, P.L.,
53 F. Supp. 3d 144 (D.D.C. 2014) ("Bain II"). Nevertheless, given the significant time that has
passed since that decision, and the more detailed record required on summary judgment, this Court
will explain afresh the facts and procedural history of Ms. Bain's two lawsuits.
A. Ms. Bain's Business Relationship with Michael Jackson and the Origins of Her
Release Agreement
In the early 2000s, Raymone Bain worked for Michael Jackson as his publicist, and in her
recounting, as his adviser as well. Bain v. Jackson, 783 F. Supp. 2d 13, 16 (D.D.C. 2010) ("Bain
I"); Pl. 's Opp'n [Corrected] 2 ("Pl. 's Mem."), ECF No. 94-1. In 2006, Ms. Bain's role expanded.
She signed a Personal Services Agreement ("PSA") with Mr. Jackson which made her the
"President/COO" of the "Michael Jackson Company," a new entity, and was promised a 10%
"Finder's fee" for any agreements or engagements initiated by her or her agents. Bain 11, 53 F.
Supp. 3d at 146; Pl.'s Ex. 1, ECF No. 91-5. Mr. Jackson also appointed Ms. Bain as his general
manager and agent. Bain I, 783 F. Supp. 2d at 16; Pl.'s Ex. 2, ECF No. 91-6. From that point
2
forward, Ms. Bain alleges that she negotiated several projects on Mr. Jackson's behalf, all of which
were covered by the Finder's fee in the PSA. Bain II, 53 F. Supp. 3d at 146; Pl.'s Mem. 3-4.
By the end of 2007, Mr. Jackson had accumulated significant debts and had failed to make
payments to employees and consultants, including Ms. Bain. Pl. 's Mem. 4. Mr. Jackson
subsequently began refinancing some of his debt. Pl.'s Mem. 5; Pl.'s Ex. 3 65:1-66:22, 137:1-
139:12, ECF No. 94-4. In conjunction with the refinancing, Mr. Jackson's lawyers initiated a
"process ... to clean all past debts and liabilities of Mr. Jackson." Pl.'s Ex. 6, ECF No. 91-10. To
that end, his attorneys sent out release agreements via email to various individuals and entities,
including Ms. Bain, on December 3, 2007. Id. ("I [(Mr. Jackson's attorney Frank Salzano)] have
been assigned the task of obtaining the payment releases from all parties compensated from funds
payable under the forthcoming transactions. This process is to clean all past debts and liabilities
of Mr. Jackson.").
Ms. Bain alleges that she had several discussions with Mr. Jackson's agents, and Mr.
Jackson himself, to understand whether her release would cover "past due debts" or, like the
releases sent to other employees, be "unconditional." See Pl. 's Mem. 16-17, 21; Pl. 's Ex. 3 125: 1-
127:24. For example, she alleges that she spoke with Londell McMillan, one of Mr. Jackson's
attorneys. Pl.'s Mem. 5; Pl.'s Ex. 3 121:9-122:9, 126:20-127:21, 135:4-136:25. Mr. McMillan
purportedly stated during that conversation, "if Michael Jackson enters into a trillion dollar
agreement today, you would get paid on the 28th .... He owes so much money, I don't understand
why there is such a big deal about your signing or anybody else signing a release." Pl.' s Ex. 3
135:4-135:23. She also claims that she spoke with Frank Salzano, who sent the December 3, 2007
email, about whether the releases covered past due debts. Pl.'s Mem. 5; Pl.'s Ex. 3 127:10-127:21.
Finally, she avers that she spoke with Mr. Jackson, who told her about the problems he was having
3
with potential lawsuits and the refinancing, explained that she could choose whether or not to sign
the release, and that he was "not signing a damn thing." Pl.'s Ex. 3 137:1-139:13. Ms. Bain
alleges that she subsequently informed Mr. Jackson that she would sign the release. Pl.' s Ex. 3
138:19-139:12.
And indeed, she did sign a release agreement after purportedly taking two additional
actions. First, she claims that she had language added to limit the period of time covered by the
agreement, to state: "[this release is for monies] to be owed to you with respect to any payments
you've entered into and agreements at the beginning of time until December 27th, 2007." Pl.' s
Ex. 3 125: 1-125: 12. Second, she added handwritten comments into the beginning of the
agreement. Pl.'s Ex. 3 133:1-134:17; Payment and Release Agreement ("Release"), ECF No. 89-
2 at 8-10.
The Release is three pages long, but in most relevant part, including Ms. Bain's handwritten
additions, reads:
In consideration of the mutual promises and understanding herein contained, the
receipt and sufficiency of :vihiclt is hereby acknowledged, the parties ·hereby agree as
follows: 'f ~l~ J g~o.~ -:e->1>"-t~4-!sfe.e~gS (il.f fr8'1&':?b. os-u);'iyr: fa!1cs````ili``!~;/Jlyn.:``1- · · - ·
Kl/;agreements whether verbal or written that you may have entered into with the Jackson
Parties from the beginning of time until December 27, 2007 (the "Payment").!
2. Except as otherwise set forth herein, in consideration of the
Payment and other consideration provided herein, you on behalf of
yourself ... do hereby absolutely, fully and forever release, relieve,
waive, relinquish and discharge the Jackson Parties ... of and from
any and all manner of action or actions, suits, debts, liabilities,
demands, claims, obligations, costs, expenses, sums of money,
controversies, damages, accounts, reckonings, and liens of every
kind or nature whatsoever, whether known or unknown, suspected
or unsuspected which you shall or may have, own or hold, or which
they at any time heretofore had owned or held against the Jackson
Parties by reason of, arising out of or in connection with any matter
whatsoever. ...
4
6. This Agreement contains the entire understanding between and
among the parties hereto and supersedes any and all prior
understandings, agreements, representations, covenants, warranties,
and releases, express or implied, written or oral, between any of the
parties concerning the subject matter of this Agreement. No changes
or modifications to this Agreement or any new agreement shall be
made between the parties hereto unless expressly set forth in
writing ....
9. This Agreement shall become effective upon receipt of the
Payment.
Release at 1-3.
B. Ms. Bain's Lawsuit Against the Mr. Jackson and MJJ Productions
In 2009, Ms. Bain sued Mr. Jackson and MJJ Productions, Inc. ("Contract Dispute
defendants"), under breach of contract, unjust enrichment, and quantum meruit theories and
I
alleged that she was owned tens of millions of dollars. Bain II, 53 F. Supp. 3d at 146. Specifically,
she claimed that she was never paid the Finder's fee that she was entitled to for the projects that
she negotiated. Id In response, the Contract Dispute defendants moved to dismiss Ms. Bain's
lawsuit because she had released them from liability. Id
Ms. Bain opposed the motion to dismiss on the grounds that consideration of the Release
was inappropriate on a motion to dismiss, or, alternatively, that the Release was invalid, procured
by fraud, or based on a mistake. Id The district court subsequently converted the motion to
dismiss into a motion for summary judgment and then stayed the case due to Mr. Jackson's death.
Id For all of the foregoing proceedings, Ms. Bain was represented by the law firm Cahn &
Samuels LLP. Id
When the district court lifted its stay, it allowed Cahn & Samuels to withdraw as counsel.
Id In their place, the Gary defendants entered appearances as counsel for Ms. Bain. Id Ms.
Bain's new counsel filed supplemental briefing on her behalf-including affidavits contesting the
5
authenticity of Mr. Jackson's signature on the Release and supporting Ms. Bain's allegations
regarding fraud. Id.; Bain I, 783 F. Supp. 2d at 16.
On May 7, 2010, the district court granted the Contract Dispute defendants' summary
judgment motion and dismissed Ms. Bain's lawsuit. Bain II, 53 F. Supp. 3d at 146 (citing Bain I,
783 F. Supp. 2d at 16-19). The district court found that the Release validly applied to Ms. Bain's
breach-of-contract claim-because the PSA was signed within the time period specified by the
Release-and rejected her allegations of fraud, mistake, and inauthentic signature. Bain I, 783 F.
Supp. 2d at 16-19. The district court dismissed the quantum meruit and unjust enrichment claims
because the PSA was a valid contract "which precludes relief under those theories." Id. at 19.
C. Ms. Bain's Motion to Set Aside the Judgment and the April 24, 2008 Letter
Five months after her case was dismissed, Ms. Bain moved to set aside the judgment
because of "newly discovered evidence that, with reasonable diligence, could not have been
discovered in time to move for a new trial." Bain II, 53 F. Supp. 3d at 146-47 (quoting Fed. R.
Civ. P. 60(6)(2)). Her new evidence was an April 24, 2008 letter from Mr. Jackson to Ms. Bain
("the Letter"). Id. at 147. It reads:
Dear Raymone:
I have never terminated your services nor did I null and void any of
your Agreements.
I know nothing about a release form. I neither authorized or signed
the same.
Therefore, I am authorizing you to continue to communicate with
Mr. Yakoob regarding the Sultan's property in Las Vegas, and to
continue your role as my General Manager and President/COO of
The Michael Jackson Company.
Thank you.
Pl.'s Ex. 9, ECFNo. 91-12.
6
Ms. Bain avers that the Letter was prompted by a conversation between Ms. Bain and Mr.
Jackson. During the alleged conversation, Ms. Bain explained to Mr. Jackson that rumors on the
internet and in the media suggested that she had been terminated from her position and Ms. Bain
informed Mr. Jackson that she needed a document to refute those rumors and reaffirm her role.
Pl.'s Ex. 3 146:3-149:10. She also claims that she informed the Gary defendants about the Letter
prior to the district court's decision on the Contract Dispute defendants' summary judgment
motion. Pl.'s Mem. 7.
Ms. Bain's attorneys, including the Gary defendants, did not mention the Letter to the
district court before summary judgment was granted. See Bain II, 53 F. Supp. 3d at 147. Ms.
Bain's motion to set aside the judgment was denied by the district court and that decision was
affirmed by the D.C. Circuit. Id.; Bain v. MJJ Prods., Inc., 751 F.3d 642 (D.C. Cir. 2014).
D. Ms. Bain's Present Lawsuit Against Her Former Attorneys
During her appeal, "Ms: Bain filed the present action, alleging that the Gary [defendants]
committed legal malpractice by failing to (1) amend the complaint to include events that occurred
subsequent to initiation of the suit; (2) marshal additional facts and evidence to support Ms. Bain's
claims; (3) alert the court to the existence of the April 24, 2008 letter and request the court's
assistance in recovering the letter through discovery; ( 4) keep Ms. Bain informed about the status
of her case; and (5) file a timely motion for reconsideration and/or notice of appeal." Bain II, 53
F. Supp. 3d at 147. In 2014, this Court denied the Gary defendants' motion to dismiss for failure
to state a claim. Id. at 146-49. In rejecting the Gary defendants' motion, this Court concluded
that there were "fundamental questions of fact" before the Court that could not be resolved on the
motion to dismiss. Id. at 149. Shortly thereafter, the Court stayed the action pending resolution
of two actions in the Superior Court of California concerning Mr. Jackson's estate. Order, ECF
7
No. 57. The Court dismissed this case without prejudice to be reinstated upon the conclusion of
those State actions. Order, ECF No. 61 This case was reinstated in 2020. Order, ECF No. 80.
The Gary defendants subsequently moved for summary judgment arguing that, even absent
malpractice, Ms. Bain would not have won her original lawsuit and thus there is no causation
between their alleged negligence and an injury to Ms. Bain. Defs.' Mot., ECF No. 89; Defs.' Mem.
in Supp. ("Defs.' Mem."), ECF No. 89. Ms. Bain opposed. Pl.'s Mem. The Gary defendants
subsequently replied. Defs.' Reply, ECF No. 99. The Gary defendants' motion is now ripe for
review.1
II. LEGALSTANDARDS
As this Court previously explained, federal procedural law and State substantive law
govern this diversity action. Bain JI, 53 F. Supp. 3d at 147.
A. Summary Judgment Standard
Summary judgment is appropriate where "the movant shows that there is no genuine
dispute as to any material fact and the movant is entitled to judgment as a matter of law." Fed. R.
Civ. P. 56(a). "[T]he requirement is that there be no genuine issue of material fact." Anderson v.
Liberty Lobby, Inc., 4 77 U.S. 242, 24 7-48 (1986) ( emphases in the original). "A fact is 'material'
if a dispute over it might affect the outcome of a suit under governing law." Holcomb v. Powell,
433 F.3d 889, 895 (D.C. Cir. 2006). Even hotly contested factual disputes that are irrelevant under
the governing law will not defeat summary judgment. Id. A factual issue is "genuine 'if the
nonmovant presents evidence such that a reasonable [factfinder] could return a verdict for the
nonmoving party.'" Occupational Safety & Health L. Project, PLLC v. Dep 't of Lab., No. 1 :21-
1
Ms. Bain also moved for partial summary judgment on the standard of care. ECF No. 87. However, because the
Court will grant defendants' motion for summary judgment on a required element for Ms. Bain's claim, her partial
motion for summary judgment will be denied as moot in the order accompanying this memorandum opinion.
8
cv-2028 (RCL), 2022 WL 3444935, at *3 (D.D.C. Aug. 17, 2022) (alteration in the original)
(quoting Doe v. Exxon Mobil Corp., No. 1:01-cv-1357 (RCL), 2022 WL 3043219, at *7 (D.D.C.
Aug. 2, 2022)). The Supreme Court has further explained that if the nonmovant "fails to make a
showing sufficient to establish the existence of an element essential to that party's case, and on
which that party will bear the burden of proof at trial" then the moving party is entitled to judgment
as a matter of law so long as it meets its own requirement "of informing the district court of the
basis for its motion and identifying those portions of [the record] ... demonstrat[ing] the absence
ofa genuine issue of material fact." Celotex Corp. v. Catrett, 477 U.S. 317, 322-23 (1986).
To that end, the Court will "view the evidence in the light most favorable to" the
nonmoving party and should not "make credibility determinations." Holcomb, 433 F.3d at 895.
Furthermore, when evaluating the motion, a "court need consider only the cited materials, but it
may consider other materials in the record." Fed. R. Civ. P. 56(c)(3).
B. Legal Malpractice
The Court must apply the substantive law of the District of Columbia for the standard of
legal malpractice. Bain II, 53 F. Supp. 3d at 147. Under that law, "the plaintiff must demonstrate
( 1) the applicable standard of care; (2) a breach of that standard; and (3) that the breach caused the
harm complained of." Id. (citing Biomet Inc. v. Finnegan Henderson LLP, 967 A.2d 662, 664
(D.C. 2009)).
The Gary defendants' summary judgment motion contests only the third element,
causation. In a legal malpractice case, causation requires use of the "case within a case" doctrine.
Under that analysis, "[t]he malpractice judge or jury must decide a case within a case and
determine what the result would have been [in the underlying lawsuit] absent the alleged
malpractice." Jacobsen v. Oliver, 451 F. Supp. 2d 181, 187 (D.D.C. 2006) (internal quotation
marks omitted) (second alteration in the original) ( quoting Rubens v. Mason, 387 F.3d 183, 190
9
(2d Cir. 2004)). This unusual-sounding judicial adventure is in fact "the accepted and traditional
means ofresolving the issues involved in the underlying proceeding in a legal malpractice action."
Id. (quoting Smith & Mallen, 4 Legal Malpractice § 33.9). The goal is to recreate "what 'should
have been' at the time of the underlying action for purposes of assessing the attorney's allegedly
negligent conduct." Id. (quoting Smith & Mallen, 4 Legal Malpractice § 33.9). Therefore, a
plaintiff in a legal malpractice claim must prove both that her attorney was negligent and that the
resulting "case within a case" would have resulted in success without the attorney's negligence.
See id. "Only by making out both cases can a plaintiff demonstrate a 'causal relationship, or
proximate cause, between the violation and the harm complained of. ... "' Id. (quoting Smith v.
Haden, 872'F. Supp. 1040, 1053 (D.D.C. 1994), ajfd, 69 F.3d 606 (D.C. Cir. 1995)).
'
Furthermore, when evaluating whether a case would have been successful absent an
attorney's malpractice, the law governing the underlying lawsuit at the time of that original lawsuit
generally governs the subsequent court's analysis. Encyclopaedia Britannica, Inc. v. Dickstein
Shapiro LLP, 128 F. Supp. 3d 103, 110 (D.D.C. 2015), ajf'd, 653 F. App'x 764 (D.C. Cir. 2016).
This stems from the principle that an attorney's conduct should be judged at the time of his
representation and "an attorney is not expected, much less required, to accurately predict
developments in the law." Biomet, 967 A.2d at 668.2
III. DISCUSSION
The Gary defendants challenge Ms. Bain on her "case within a case." Accordingly, this
Court must reconstruct the original case that Ms. Bain brought against the Contract Dispute
defendants and decide-within the summary judgment standard-whether the Gary defendants'
2
Although, in special circumstances like statutory interpretation, later decisions will be applied backward to determine
the propriety of an attorney's conduct because "[statutory] construction is an authoritative statement of what the statute
has always meant that applies retroactively." Encyclopaedia Britannica, Inc., 128 F. Supp. 3d at 111.
10
alleged malpractice caused Ms. Bain to lose a meritorious claim in that action. Ms. Bain brought
three claims in her original lawsuit: breach of contract, unjust enrichment, and quantum meruit.
Bain I, 783 F. Supp. 2d at 16; Defs.' Mem. 1; Pl.'s Ex. 8, ECF No. 91-11. Here, she alleges that
the Gary defendants' actions lost her that lawsuit because they failed to "(1) amend the complaint
to include events that occurred subsequent to initiation of the suit; (2) marshal additional facts and
evidence to support Ms. Bain's claims; (3) alert the court to the existence of the April 24, 2008
letter and request the court's assistance in recovering the letter through discovery; ( 4) keep Ms.
Bain informed about the status of her case; and (5) file a timely motion for reconsideration and/or
notice of appeal." Bain II, 53 F. Supp. 3d at 147.
For the purposes of this causation analysis, those five alleged failures can be broken down
into three categories of potential effect on Ms. Bain's original lawsuit. These categories are
important because, in order to decide whether the Gary defendants merit summary judgment on
causation, this Court must precisely trace whether an alleged failure by the Gary defendants caused
Ms. Bain to lose a meritorious claim in her original lawsuit.
The first category consists of the alleged failure to file a motion for reconsideration or
notice of appeal. Causation will only be satisfied for that category if reconsideration or appellate
review would have led to a favorable outcome for Ms. Bain. Therefore, this Court must consider
the evidence available to the district court at the time of the ruling and determine whether de novo
review would have led Ms. Bain to maintain a meritorious claim. Steele v. Salb, 93 A.3d 1277,
1282 (D.C. 2014). The second category is the failure to alert the district court to the existence of
the Letter. Causation will be satisfied if the Letter would have led to a ruling in favor of Ms. Bain
if it had been presented. Finally, the remaining three alleged failures focus on the lack of
introduction of additional evidence or events based on adequate investigation or consultation. To
11
determine causation for this final category, the Court will consider whether the new evidence that
Ms. Bain has marshaled in the present lawsuit would have led her to maintain a meritorious claim
,
if introduced in the original lawsuit.
Moreover, because the substantive law governing the Release was the law of New York,
Bain I, 783 F. Supp. 2d at 17, the Court must evaluate the questions related to the Release under
the same. See, e.g., Pl.'s Mem. 15, 19, 22 (citing New York law for considering the Release);
Defs.' Mem. 11 ( accepting New York law as providing the governing law for the case within a
case for the Release). The substantive law of the District of Columbia was applied to the claims
for quantum meruit and unjust enrichment, Bain I, 783 F. Supp. 2d at 19, and this Court will also
apply that law.
After considering the three categories of alleged malpractice as applied to the original
claims of breach of contract, quantum meruit, and unjust enrichment, the Court concludes that the
Gary defendants' motion should be granted and judgment as a matter of law should be entered on
the causation element.
A. Summary Judgment is Warranted on Causation for the Original Breach-of-
Contract Claim
The district court dismissed Ms. Bain's original breach-of-contract claim because that court
concluded the claim was barred by the Release. Bain I, 783 F. Supp. 2d at 17-18. Therefore, this
Court will begin by summarizing the general principles regardingthe validity of a release under
New York law.
"It is well established [under New York law] that a valid release constitutes a complete bar
to an action on a claim which is the subject of the release." Glob. Mins. & Metals Corp. v. Holme,
824 N.Y.S.2d 210, 214 (N.Y. App. Div. 2006). When "the language of a release is clear and
unambiguous, the signing of a release is a 'jural act' binding on the parties." Booth v. 3669
12
Delaware, Inc., 703 N.E.2d 757, 758 (N.Y. 1998). New York's "public policy favor[s]
enforcement of settlements" and thus releases. Id. "Releases are contracts and their interpretation
is governed by principles of contract law." Shklovskiy v. Khan, 709 N.Y.S.2d 208,209 (N.Y. App.
Div. 2000). A release, like a contract, can still be set aside under a variety of defenses. See id.The "traditional bases for setting aside a releasejare ]duress, illegality, fraud, or mutual mistake."
Rocanova v. Equitable Life Assur. Soc. of US., 634 N.E.2d 940, 945 (N.Y. 1994). The person
challenging a signed release has the burden to demonstrate that the release she signed is invalid.
See Mergler v. Crystal Properties Assocs., Ltd., 583 N.Y.S.2d 229, 231-32 (N.Y. App. Div. 1992).
The original district court concluded that the Release was valid and because there was "no
ambiguity in the language of Bain's Release, [the court] may apply it without considering Bain's
testimony about her intent." Bain I, 783 F. Supp. 2d at 17. The district court then rejected the two
defenses-fraudulent inducement and unilateral mistake-raised by Ms. Bain to void the
otherwise valid release. Id. at 17-18.
This Court will now evaluate the same arguments Ms. Bain made in the original lawsuit
to determine whether she lost a meritorious claim due to the Gary defendants' alleged negligence.
The Court will evaluate Ms. Bain's arguments in the following order: (1) whether the Release was
valid and covered Ms. Bain's claims, (2) fraudulent inducement, and then (3) unilateral mistake.3
After considering the evidence presented by the parties in the light most favorable to Ms. Bain, the
Court concludes that there is no genuine dispute of material fact and defendants should be granted
judgment as a matter of law on the causation prong of legal malpractice for Ms. Bain's original
3
To contest the Gary defendants' assertion that a valid release will bar subsequent claims covered by that release, Ms.
Bain cites generally to the idea "that a release may be invalidated by duress, illegality, fraud, or mutual mistake." Pl. 's
Mem. 13-14. However, she provides no specific argument OI) duress, illegality, or mutual mistake. If this conclusory
and undeveloped reference was meant to raise the possibility of success on those grounds, Ms. Bain has forfeited the
argument by failing to pursue it. See Taylor v. Fed. Aviation Admin., No. I: l 8-cv-35 (APM), 2019 WL 3767512, at
*8 (D.D.C. Aug. 9, 2019); Bryant v. Gates, 532 F.3d 888, 898 (D.C. Cir. 2008).
13
breach-of-contract claim. No reasonable factfinder could conclude that, even absent defendants'
alleged malpractice, Ms. Bain had a meritorious breach-of-contract claim in her original lawsuit.
1. Even Absent Defendants' Alleged Malpractice, the Release Validly Applied to Ms.
Bain's Breach-of-Contract Claim
In the original district court action, Ms. Bain attacked both the general validity of the
Release and the application of the Release to her Finder's fee. Because Ms. Bain would have lost
on whether the Release validly barred her lawsuit even without defendants' alleged malpractice,
summary judgment for the Gary defendants on this issue is appropriate.
When a party signs a contract, the party is "legally bound by his or her signature." State
Bank of India v. Star Diamonds, Inc., 901 F. Supp. 177, 179 (S.D.N.Y. 1995). New York law
favors the validity and effect of a release. See Booth, 703 N.E.2d at 758;
N.Y. Gen. Oblig. Law§ 15-303 (McKinney) (stating that a release "shall not be invalid because
of the absence of consideration or of a seal"); N. Y. Gen. Oblig. Law § 5-1103 (McKinney) (stating
that "[a]n agreement, promise or undertaking to change or modify, or to discharge in whole or in
part, any contract, [or ]obligation ... shall not be invalid because of the absence of consideration,
provided that the ... [release] shall be in writing and signed by the party against whom it is sought
to enforce the change, modification or discharge, or by his agent"). "All that is required is that
there be an expression of a present intention to renounce a claim or discharge an obligation." Pratt
Plumbing & Heating, Inc. v. Mastropole, 414 N.Y.S.2d 783, 784-85 (N.Y. App. Div. 1979). "[I]t
is not a prerequisite to the enforceability of a release that the releasor be subjectively aware of the
precise claim he or she is releasing." Mergler, 583 N.Y.S.2d at 232. Thus, when a release is clear
and unambiguous, "the release plaintiff signed should be enforced according to its terms, and
plaintiffs claim dismissed." Booth, 703 N.E.2d at 758.
14
On de novo review, this Court agrees with the district court's decision that the Release was
valid as applied against Ms. Bain. Ms. Bain signed the document and concedes that she accepted
the $488,820.05 in consideration recited in the document she signed. See Release at 3; Pl. 's Ex. 3
131:15-132:3. The Release was given to her by one of Mr. Jackson's attorneys, Pl.'s Ex. 6, and
states that that the agreement was between her, Mr. Jackson, and his "personal and business related
entities." Release at 1. The Release further states that Ms. Bain was accepting $488,820.05 from
Mr. Jackson in exchange for releasing "any and all agreements whether verbal or written that you
may have entered into with the Jackson Parties from the beginning of time until December 27,
2007." See id. While Ms. Bain presented evidence that Mr. Jackson's signature was not his own,
Pl.'s Ex. 10, ECF No. 91-13, it is her signature that matters for purposes of enforcement of the
release against her. See Pratt Plumbing & Heating, 414 N.Y.S.2d at 784-85; N.Y. Gen. Oblig.
Law§ 5-1103; cf Kaplan v. Lippman, 552 N.E.2d 151, 153 n.* (N.Y. 1990) (per curiam) ("The
absence of a signature by the party seeking to enforce the agreement is without legal
significance."). Ms. Bain agreed to release the parties in exchange for the $488,820.05 from Mr.
Jackson, that money was sent to her, and she then accepted the money. That is sufficient to give
the Release valid effect. See Release ~ 9 ("This Agreement shall become effective upon receipt of
the Payment.").
Furthermore, the additional fact development from the expanded record available in the
present lawsuit would not have defeated the Release's validity. The Release itself states that
"understandings, agreements, representations, covenants, warranties, and releases, express or
implied, written or oral, between any of the parties concerning the subject matter of this
Agreement" were superseded by the Release. The Release ~ 6. Accordingly, further fact
development of prior understandings and representations by Mr. Jackson and his agents, see infra
15
Part I.A., would have been foreclosed when used to contradict the unambiguous language of the
Release. See Marine Midland Bank-S. v. Thurlow, 425 N.E.2d 805, 807-08 (N.Y. 1981) (applying
New York's parol evidence rule).
Finally, Ms. Bain argues that the Letter from Mr. Jackson, if presented to the district court,
would have been understood as repudiating or nullifying the Release. See Pl.' s Mem. 17-19. The
Letter states, in relevant part, "I have never terminated your services nor did I null and void any of
your Agreements. I know nothing about a release form. I neither authorized or signed the same."
Pl.' s Ex. 9. First, the Letter could not have been a repudiation of the Release because Mr. Jackson
had already fully performed by tendering payment. See Release ,r 9; Paramount Pictures Corp. v.
Puzo, No. 12-cv-1268 (AJN), 2012 WL 4465574, at *8 (S.D.N.Y. Sept. 26, 2012) (explaining that
repudiation requires a failure to perform under New York law); see also In re Best Payphones,
Inc., 450 F. App'x 8, 11 (2d Cir. 2011) (summary order); MBIA Ins. Corp. v. Patriarch Partners
VIII, LLC, 842 F. Supp. 2d 682, 718 (S.D.N. Y. 2012). Second, the Letter is insufficient to nullify
or modify the Release. The Release states that "[n]o changes or modifications to this Agreement
or any new agreement shall be made between the parties hereto unless expressly set forth in
writing." Release ,r 6. Mr. Jackson's statement that he was unaware of a "release form" cannot
be an express written change or modification of the Release as it does not even acknowledge its
existence.
As to the scope of the Release, "[i]nasmuch as the 'language of the release is clear, effect
must be given to the intent of the parties as indicated by the language employed."' Rocanova, 634
N.E.2d at 945 (quoting Matter of Schaefer, 221 N.E.2d 538,540 (N.Y. 1966)). General language
in a release will be construed against the person releasing claims and the burden is on that
individual to establish that the language is in fact more limited. Consorcio Prodipe, SA. de C. V
16
v. Vinci, SA., 544 F. Supp. 2d 178,189-90 (S.D.N. Y. 2008). If "the language with respect to the
parties' intent is clear and unambiguous,it will be given effect,regardless of one party's claim that
he intended something else." Chaudhry v. Garvale, 692 N.Y.S.2d 447,448 (N.Y. App. Div. 1999);
Matter of Schaefer, 221 N.E.2d at 540 ("The fact that the [party] may have intended something
else is irrelevant."). "[I]t is not a prerequisite to the enforceability of a release that the releasor be
subjectively aware of the precise claim he or she is releasing, lack of such knowledge does not
preclude summary judgment." Mergler, 583 N.Y.S.2d at 232. And "[i]f the agreement sets fo1ih
the parties' intent clearly and unambiguously, the Court need not look to extrinsic evidence to
determine the parties' obligations under the contract." Deutsche Bank Sec., Inc. v. Rhodes, 578 F.
Supp. 2d 652, 662 (S.D.N.Y. 2008).
On review of the original record, the district court's conclusion that the Release is
unambiguous and thus applicable without consideration of Ms. Bain's additional evidence was
correct. "The Release unambiguously covers 'all monies, known or unknown,' owed under 'any
and all agreements whether written or verbal "' within the stated time period in the Release. Bain
I, 783 F. Supp. 2d at 17 (emphasis in the original); Release at 1. While Ms. Bain is correct that
the intent ofthe parties is important,see Pl.'s Mem. 15-17,it is the objective intent in the document
itself that matters when the text is clear and unambiguous. See Rocanova, 634 N.E.2d at 945;
Chaudhry, 692 N.Y.S.2d at 448. The language in the Release is, in fact, unambiguous and clear.
It states that Ms. Bain accepted the monetary consideration "as full and final satisfaction of any all
monies, known and unknown, to be owed to you by the Jackson Parties with respect to any and all
agreements whether verbal or written that you may have entered into with the Jackson Parties from
the beginning of time until December 27, 2007." Release at 1. Her handwritten additions did not
include a strikethrough of that language,nor was there any indication that her writing was supposed
17
to limit the unambiguous language of the Release that she signed. See id. She may have intended
a limitation, but the Release does not objectively represent that limitation. See Matter of Schaefer,
221 N.E.2d at 540. Accordingly, the district court's conclusion was correct on the record before
it and, as a matter of law, the scope of the contract unambiguously covers the PSA and thus Ms.
Bain's Finder's fee. See Rhodes, 578 F. Supp. 2d at 662-63.
For that same reason, additional record development, or the Letter, would not have changed
the result. The clear, unambiguous, and objective intent on the face of the Release, including the
scope of the Release, stands on its own. See Kraft Foods, Inc. v. All These Brand Names, Inc., 213
F. Supp. 2d 326,330 (S.D.N.Y. 2002) (holding summary judgment appropriate on the validity and
scope of a release where "[t]he language is as broad and general as it is clear" and "nothing within
the four corners of the Release suggests an ambiguity that would permit this Court to look beyond
the document to extrinsic evidence as to the parties' intent" absent plaintiff demonstrating an
affirmative defense like fraud or mistake).
There is no genuine dispute of material fact barring summary judgment on the issue of
whether the Gary defendants' alleged failures caused an adverse ruling against Ms. Bain on the
validity and scope of the Release. The district court correctly decided the issue on the record
before it, additional fact development would not have led to a different outcome, and presentation
of the Letter would not have altered that conclusion.
Given that the Release is valid and facially covers the breach-of-contract claim Ms. Bain
brought in her original lawsuit, the Court will now move to the two defenses of fraudulent
inducement and unilateral mistake.
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2. Even Absent the Gary Defendants' Alleged Malpractice, Ms. Bain Could Not
Demonstrate the Defense of Fraudulent Inducement
"To establish fraud-in-the-inducement under New York law, Bain [had to] prove that the
Jackson parties (1) made a material representation or omission which was false and known to be
false (2) for the purpose of inducing her to rely on it, and (3) that Bain reasonably relied upon it in
entering the agreement ( 4) to her detriment." Bain I, 783 F. Supp. 2d at 17; see also Holme, 824
N.Y.S.2d at 214; Nasik Breeding & Rsch. Farm Ltd. v. Merck & Co., 165 F. Supp. 2d 514, 528
(S.D.N.Y. 2001). The plaintiff must succeed on each element to make out the defense.
"New York quite clearly rejects any strict application of the parol evidence rule when fraud
is claimed. An oral representation which is fraudulent and which induces reliance may be a defense
even though it contradicts a provision of a written contract." Centronics Fin. Corp. v. El
Conquistador Hotel Corp., 573 F .2d 779, 782 (2d Cir. 1978). Generally, in the context of a release,
fraud will lie when the releasor did not have sufficient time for investigation or deliberation, there
were unfair circumstances, or it seems unlikely that the release was "fairly and knowingly" made
I
to unknown claims. See, e.g., Mangini v. McClurg, 249 N.E.2d 386, 392 (N.Y. 1969);
Himmelsbach v. George, 894 N.Y.S.2d 647, 648 (N.Y. App. Div. 2010); Haynes v. Garez, 758
,
N.Y.S.2d 391,393 (N.Y. App. Div. 2003).
When considering the required element of reasonable reliance, a plaintiff "must
demonstrate that he was induced to 'act or refrain from acting' to his detriment by virtue of the
alleged misrepresentation or omission." Shea v. Hambros PLC, 673 N.Y.S.2d 369, 374 (N.Y.
App. Div. 1998) (quoting Megaris Furs, Inc. v. Gimbel Bros., 568 N.Y.S.2d 581, 584 (N.Y. App.
Div. 1991 )). When the party claiming to have been defrauded is "a sophisticated business[person ]"
courts should look with a skeptical eye toward claims of reasonable reliance. See id. ("[Plaintiff]
can hardly claim with any credibility that he, a savvy businessman, entered into the resulting
19
agreements lulled by faith or trust in the parties across the bargaining table, or that he unwittingly
gave up some valued right in the bargain."); Abrahami v. UPC Const. Co., 638 N.Y.S.2d 11, 14
(N. Y. App. Div. 1996) ("Plaintiffs, who are all sophisticated businessmen, had a duty to exercise
ordinary diligence and conduct an independent appraisal of the risk they were assuming."); accord
Wyly v. CA, Inc., No. 05-cv-4430 (TCP), 2009 WL 3128034, at *13 (E.D.N.Y. Sept. 29, 2009),
aff'd sub nom. Wyly v. Computer Assocs. Inter. Inc., 384 F. App'x 46 (2d Cir. 2010). Courts will
consider, for example, what actions the plaintiff took to investigate statements with hints of falsity,
how the plaintiff made further inquiries, or whether the plaintiff inserted appropriate language for
protection. See Holme, 824 N.Y.S.2d at 214-16 (concluding that summary judgment for the
defendant was warranted because there was no triable issue of fact on reasonable reliance).
Ms. Bain argues that she could have established fraud-in-the-inducement absent attorney
malpractice in two ways. First, as was addressed in the original case, that she was fraudulently
induced because there was a material omission of information regarding the status of projects
subject to her Finder's fee. Pl. 's Mem. 20. Second, that she was fraudulently induced because she
was misled as to whether the scope of the Release "was limited to past due debts." Id. at 20-22.
For her second argument, Ms. Bain maintains that she confirmed that the Release's scope "was
only for past due amounts" and that she was specifically told, "if Michael Jackson were to enter
into a deal the day the Release was signed, Bain would be entitled to be paid from that deal." Id.;
Pl.'s Ex. 3 135:4-135:23; see infra Part I.A. She claims that Mr. Jackson's representatives knew
that she was laboring under a mistaken understanding and induced that misunderstanding. Pl.' s
Mem. 20-21.
As for Ms. Bain's first argument, none of the alleged malpractice would have led to a
different result. Review of the original record confirms that "the Jackson parties had no duty to
20
disclose the status of the projects on which Bain bases her claims" given that she, in fact, negotiated
the projects and was familiar with their existence. See Bain I, 783 F. Supp. 2d at 18. Similarly,
Ms. Bain could not reasonably rely on any omission given her actual knowledge of the projects.
See id. The expanded record does not alter this conclusion, nor does the Letter bear on this matter.
As for the second argument, it does not appear that the district court addressed the question
of whether the scope of the agreement was subject to fraudulent inducement. Regardless, Ms.
Bain's argument is without merit because, even absent the Gary defendants' alleged malpractice,
she would have lost on the required element of reasonable reliance. After all, "[a] plaintiff is
expected to exercise ordinary diligence and may not claim to have reasonably relied on a
defendant's representations where he has 'means available to him of knowing, by the exercise of
'
ordinary intelligence, the truth or the real quality of the subject of the representation."' Sitar v.
Sitar, 878 N.Y.S.2d 377, 380 (N.Y. App. Div. 2009) (quoting Curran, Cooney, Penney, Inc. v.
Young & Koomans, Inc., 583 N.Y.S.2d 478,479 (N.Y. App. Div. 1992)).
Here, Ms. Bain's evidence, whether on the original record or the expanded record, goes
against her contention that she reasonably relied on the statements made to her. The December 3,
2007 email from Mr. Jackson's attorney Frank Salzano specifically states that the release she
would go onto sign was part of the "process ... to clean all past debts and liabilities of Mr.
Jackson." Pl.'s Ex. 6; Pl.'s Mem. 21. Mr. Jackson told her substantially the same thing. Pl.'s Ex.
3 138:1-138:23 ("If they place me in another position where I have all of these lawyers,
accountants, consultants, and employees suing me, I won't get a dime from this loan refinance.").
She was then put on notice that other releases covered a broad range of liabilities. Pl.' s Ex. 3
125: 1-127 :24 (Ms. Bain stating that she knew that "the other releases were unconditional
releases"). In fact, because she was put on notice, Ms. Bain acted to "tailor" her release to represent
21
language that she wanted. Pl.'s Ex. 3 125:5-125:10 ("My release -- due to my concerns and that
of Mr. Jackson's, the sentence was added 'to be owed to you with respect to any payments you've
entered into and agreements at the beginning of time until December 27th, 2007. "'); Pl. 's Mem.
21. Her conversations with Mr. Jackson and his agents about the scope and import of the Release
must be considered side-by-side with that background. See Pl.'s Mem. 20-22. Finally, as the
original district court recognized, Ms. Bain was a sophisticated businesswoman. Bain I, 783 F.
Supp. 2d at 18. She graduated from Georgetown University Law Center. DX 14 124:6-124:8,
ECF No. 89-2 at 250-567. She had full access to the Release and read it before signing it. Pl. 's
Ex. 3 124:8. This is far from the paradigmatic fraudulent inducement case, featuring an
unsophisticated accident victim confronted with a strange release mere days after the accident. See
Powell v. Adler, IO N.Y.S.3d 306 (N.Y. App. Div. 2015); Pl.'s Mem. 22 (relying on Powell).
The Court concludes that Ms. Bain could not have reasonably relied on the alleged
statements by Mr. Jackson and his agents as to the Release's scope and thus could not have been
fraudulently induced into signing the Release. Ms. Bain was put on notice that all of the releases
being sent out were part of a process to clean up Mr. Jackson's past debts and other liabilities; she
saw how far other "unconditional" releases went, Pl.'s Ex. 3 125:1-127:24; she added language
she felt was sufficient for her to sign the Release; she read the entire Release, including the
statement that it covered "any and all agreements whether verbal or written that you may have
entered," Release at 1; she signed the Release; and she did it all with a background of sophisticated
business and legal knowledge. Given this evidence-even when viewed in the light most favorable
to Ms. Bain-no reasonable factfinder could conclude that the original or expanded record,
including the Letter, would support the necessary finding of reasonable reliance. See Holme, 824
N.Y.S.2d at 215 ("We find that even assuming the defendant made such misrepresentations with
22
intent to defraud, no triable issue exists with respect to [the sophisticated plaintiffs] claim for
fraudulent inducement since the evidence establishes that [the plaintiffs] reliance on any such
alleged misrepresentations was unreasonable."). Accordingly, there is no genuine dispute of
material fact barring summary judgment on the issue of whether the Gary defendants' alleged
failures caused Ms. Bain to lose on her fraudulent inducement argument.
3. Even Absent the Gary Defendants' Alleged Malpractice, Ms. Bain Could Not
Demonstrate the Defense of Unilateral Mistake
"Under New York law, in order for a court to allow rescission of a contract on the basis of
a unilateral mistake, 'a party must establish that (i) he entered into a contract under a mistake of
material fact, and that (ii) the other contracting party either knew or should have known that such
mistake was being made."' Kraft Foods, 213 F. Supp. 2d at 330 (quoting Ludwig v. NYNEX Serv.
Co., 838 F. Supp. 769, 795 (S.D.N.Y. 1993)). Furthermore, a unilateral mistake requires the party
raising the defense to show that "the other party t[ook] advantage of an error only it has noticed
under circumstances constituting fraud." Resort Sports Network Inc. v. PH Ventures III, LLC, 886
N.Y.S.2d 5, 8 (N.Y. App. Div. 2009) (citing George Backer Mgmt. Corp. v. Acme Quilting Co.,
385 N.E.2d 1062 (N. Y. 1978)); see also Aetna Cas. & Sur. Co. v. Aniero Concrete Co., 404 F.3d
566, 585 (2d Cir. 2005) (considering New York law and concluding that "a party's unilateral
mistake will not provide a basis for rescission unless it is accompanied by some fraud committed
by the other contracting party").
Ms. Bain argues she would have succeeded on unilateral mistake, absent defendants'
alleged malpractice, due to substantially the same evidence that she pointed to for fraudulent
inducement. See Pl. 's Mem. 22-23. In her original lawsuit, the district court rejected Ms. Bain's
unilateral mistake argument "[f]or the same reasons" it rejected her fraudulent inducement
argument, stating that "[i]t is illogical to believe that the Jackson parties knew or should have
23
known that Bain was unaware of the deals-a showing that is required to prove unilateral mistake."
Bain I, 783 F. Supp. 2d at 18.
Because this Court has already explained that no reasonable factfinder could conclude,
even absent the alleged malpractice, that Ms. ' Bain reasonably relied on the alleged
misrepresentations, summary judgment in favor of the Gary defendants is warranted on the issue
of whether the defendants' alleged failures caused Ms. Bain to lose on her unilateral mistake
0
argument. See Aniero Concrete, 404 F.3d at 585 ("To rescind a contract because of unilateral
mistake [under New York law], therefore, the plaintiff must show ... 'an injury resulting from
justifiable reliance by the aggrieved party."' ( quoting Allen v. Westl'oint-Pepperell, Inc., 945 F .2d
40, 44 (2d Cir. 1991))).
B. Summary Judgment is Warranted on Causation for the Original Unjust
Enrichment and Quantum Meruit Claims
As for causation related to the claims of unjust enrichment and quantum meruit, summary
judgment is easily granted for defendants. A plaintiff may not sue under either claim when her
alleged injury flows from an actual contractual relationship. See Emerine v. Yancey, 680 A.2d
1380, 1384 (D.C. 1996); 4934, Inc. v. D.C. DeptofEmp. Servs., 605 A.2d 50, 55-56 (D.C. 1992);
accord Heller v. Kurz, 643 N.Y.S.2d 580 (N.Y. App. Div. 1996) ("A cause of action under a quasi
contract theory only applies in the absence of an express agreement." (internal quotation marks
omitted) (quoting Clark-Fitzpatrick, Inc. v. Long Island R. Co., 516 N.E.2d 190 (N.Y. 1987))).
Indeed, in her opposition, Ms. Bain does not try to argue that unjust enrichment or quantum meruit
were otherwise meritorious claims lost due to the Gary defendants' alleged malpractice-despite
the Gary defendants dedicating a subheading to the argument. Compare Defs.' Mem. 18-19
("Allegations of Unjust Enrichment and Quantum Meruit Fail Since PSA Was a Valid Contract."),
with Pl. 's Mem. (failing to mention "unjust enrichment" or "quantum meruit").
24
As the district court explained, and Ms. Bain does not dispute, "the PSA is a valid contract,
which precludes relief under those [equitable] theories." Bain I, 783 F. Supp. 2d at 19 (citing
Bloomgarden v. Coyer, 479 F.2d 201,210 (D.C. Cir. 1973)). The district court's analysis was
correct on de novo review, no additional evidence in the record for this lawsuit has been presented
to show otherwise, and the Letter has no bearing on the existence and validity of the PSA.
Consequently, the Gary defendants are entitled to judgment as a matter oflaw on causation for the
unjust enrichment and quantum meruit claims.
* * *
There is no genuine dispute of material fact as to causation, the third element of legal
malpractice, and no reasonable factfinder could conclude on this record that Ms. Bain lost a
meritorious claim in her original lawsuit. Therefore, the Court will enter judgment as a matter of
law on the causation element and, because that element is required for Ms. Bain to prevail, the
Court will order that Ms. Bain's lawsuit be dismissed with prejudice.
IV. CONCLUSION
Based on the reasoning above, this Court will GRANT the Gary defendants' motion for
summary judgment. The Court will therefore enter judgment for the Gary defendants on the
causation element oflegal malpractice. Because that element is required, the Court will DISMISS
WITH PREJUDICE the plaintiffs lawsuit.
The Court will also DENY the plaintiffs motion for partial summary judgment as moot.
A separate order will issue.
Date: September~ 2022
Royce C. Lamberth
United States District Judge
25