United States District Court, N.D. Illinois, Eastern Division
R. WOOD UNITED STATES DISTRICT JUDGE.
motion to dismiss  is granted. Plaintiff's complaint
is dismissed with prejudice. The Clerk is directed to enter
Judgment in favor of Defendant. See the accompanying
Statement for details. Civil case terminated.
GlobalTap, LLC has sued Defendant Niro Law, Ltd. for legal
malpractice. GlobalTap retained Niro Law to represent it in a
federal lawsuit asserting intellectual property claims
against Elkay Manufacturing Company. GlobalTap alleges that
Niro Law failed to obtain certain relevant documentation from
Elkay during discovery in that lawsuit and that, as a result
of that failure, GlobalTap was forced to settle with Elkay
for less than the lawsuit's reasonable value. In its
initial complaint before this Court, GlobalTap asserted
claims against both Niro Law and Paul Vickrey, an attorney
with Niro Law. The defendants filed a motion to dismiss the
complaint, which this Court granted. GlobalTap then filed its
First Amended Complaint (“FAC”). The FAC only
asserts claims against Niro Law, dropping Vickrey as a
defendant. In response to the amended pleading, Niro Law has
again moved to dismiss Global Tap's claims.
was in the business of developing water bottle filling
stations. (FAC ¶ 1, Dkt. No 28.) In January 2013,
GlobalTap entered into a contract with Niro Law to represent
it in pursuing a variety of intellectual property claims
against Elkay. (Id. ¶ 4.) Shortly thereafter,
GlobalTap, represented by Niro Law, filed a complaint against
Elkay, alleging claims for patent infringement, trade secret
misappropriation, breach of contract, fraud, and unfair
competition. (Id. ¶ 8.)
the course of the litigation, GlobalTap's counsel served
discovery requests. (Id. ¶ 10.) Elkay produced
documents but it became clear that Elkay had not produced all
of its responsive documents. (Id. ¶¶
12-13.) In particular, Elkay had failed to produce documents
showing its sales of the accused products. (Id.
¶ 12.) Fact discovery closed on November 25, 2013, and
the next day Niro Law filed a motion to withdraw as counsel.
(Id. ¶¶ 22, 25.) The Court granted the
motion on December 2, 2013. (Id. ¶ 29.)
GlobalTap hired successor counsel to take over the matter and
successor counsel hired an expert to determine what damages
Elkay had caused GlobalTap. (Id. ¶¶
35-36.) In his report, the expert stated that, based on the
documents obtained in discovery, he was not able to verify
the sales data provided by Elkay. (Id. ¶ 42.)
Furthermore, he stated that because he did not receive data
on costs, he was not able to calculate disgorgement fully.
(Id. ¶ 43.) Ultimately, GlobalTap settled the
case with Elkay, but GlobalTap now claims that the settlement
amount was far less than reasonably expected. (Id.
¶ 47.) GlobalTap contends that had it obtained more
discovery it would have prevailed at trial or received a
larger settlement. (Id. ¶ 48.)
complaint will survive a motion pursuant to Federal Rule of
Civil Procedure 12(b)(6) if, after the Court disregards any
portions that are “no more than conclusions, ” it
“contain[s] sufficient factual matter, accepted as
true, to ‘state a claim to relief that is plausible on
its face.'” Ashcroft v. Iqbal, 556 U.S.
662, 678-79 (2009) (quoting Bell Atl. Corp. v.
Twombly, 550 U.S. 544, 570 (2007)). “A claim has
facial plausibility when the plaintiff pleads factual content
that allows the court to draw the reasonable inference that
the defendant is liable for the misconduct alleged.”
Id. at 678. “‘Plausibility' is not a
synonym for ‘probability' in this context, but it
asks for ‘more than a sheer possibility that a
defendant has acted unlawfully.'” Bible v.
United Student Aid Funds, Inc., 799 F.3d 633, 639 (7th
Cir. 2015) (quoting Olson v. Champaign Cty., 784
F.3d 1093, 1099 (7th Cir. 2015)). A plaintiff seeking to
survive a motion to dismiss must “plead some facts that
suggest a right to relief that is beyond the speculative
level.” In re marchFIRST Inc., 589 F.3d 901,
905 (7th Cir. 2009) (internal quotation marks omitted). That
is, “[w]hile a plaintiff need not plead detailed
factual allegations to survive a motion to dismiss, she still
must provide more than mere labels and conclusions or a
formulaic recitation of the elements of a cause of action for
her complaint to be considered adequate.” Bell v.
City of Chicago, 835 F.3d 736, 738 (7th Cir. 2016)
(internal quotation marks omitted).
Supreme Court of Illinois has stated succinctly that a cause
of action for legal malpractice includes the following
elements: (1) the existence of an attorney-client
relationship that establishes a duty on the part of the
attorney, (2) a negligent act or omission constituting a
breach of that duty, (3) proximate cause of injury, and (4)
actual damages. See Sexton v. Smith, 492 N.E.2d
1284, 1286-87 (Ill. 1986). “For purposes of a legal
malpractice claim, a plaintiff is not considered to be
injured unless and until he has suffered a loss for which he
may seek monetary damages. The existence of actual damages
therefore is essential to a viable cause of action for legal
malpractice, and ‘[u]nless the client can demonstrate
that he has sustained a monetary loss as the result of some
negligent act on the lawyer's part, his cause of action
cannot succeed.'” Stevens v. McGuireWoods
LLP, 43 N.E.3d 923, 927 (Ill. 2015) (quoting N. Ill.
Emergency Physicians v. Landau, Omahana & Kopka,
Ltd., 837 N.E.2d 99, 107 (Ill. 2005)); see also
Nelson v. Quarles & Brady, LLP, 997 N.E.2d 872, 880
(Ill.App.Ct. 2013) (stating that no cause of action for
malpractice exists unless counsel's negligence has
resulted in the loss of an underlying cause of action or, if
the attorney was defending in the underlying suit, the loss
of a meritorious defense).
prior decision, the Court observed that GlobalTap's
initial complaint stated no facts regarding how Niro
Law's alleged failure to pursue further documentation
from Elkay through the discovery process resulted in the loss
of an underlying cause of an action. (Order at 3, Dkt. No.
23.) Rather, GlobalTap sought to proceed on a theory that had
it received more discovery from Elkay, GlobalTap might have
discovered that Elkay misstated its sales or GlobalTap might
have analyzed further damages theories that might have
benefited its case. (Id.) GlobalTap's FAC still
relies upon this theory but, just as with the prior
complaint, the FAC has not stated any facts that would
plausibly suggest that any additional documentation received
in discovery from Elkay would actually contradict Elkay's
representations in the lawsuit or reveal other damages
theories that would have resulted in a more favorable
settlement. Thus, GlobalTap's FAC still fails to set
forth facts plausibly suggesting that Niro Law's alleged
failures in diligently pursuing discovery actually resulted
in loss; instead, the FAC rests solely on speculation about
the possibility of what additional discovery might have shown
and what impact it might have had on settlement negotiations.
As a result, the FAC must be dismissed.
dismissal shall be with prejudice, as the Court concludes any
further opportunity for amendment would be futile.
Tribble v. Evangelides, 670 F.3d 753, 761 (7th Cir.
2012) (“District courts have broad discretion to deny
leave to amend . . . where the amendment would be
futile.”). Given that the Court's prior ruling
highlighted for GlobalTap that it would be required to set
forth facts plausibly suggesting that Niro Law's alleged
breach actually resulted in loss and that GlobalTap's FAC
still failed in this regard, the Court concludes that, even
if offered another opportunity to amend its complaint,
GlobalTap would be unable to plead sufficient facts to state