Panel: Loss of Confidence Alone Is Not ‘Cause’
Rasmy argued that losing confidence in his attorney was enough to show he fired Diederich “for cause,” thus eliminating any fee obligations. The panel rejected that argument and said the district court did not need to consider every hypothetical reason for a “for-cause” termination.
He also claimed the court erred by not holding an evidentiary hearing, but the panel said he waived that point by never requesting one.
Diederich praised the ruling in his favor, saying, “A client cannot refuse to pay his or her lawyer simply for giving sound, but unwanted, legal advice.”
Court Says Fee Analysis Was Too Thin to Stand
While the Second Circuit agreed the firing wasn’t for cause, it nevertheless tossed the six-figure lien back to the district court for deeper analysis. The judges said it was unclear whether the lower court properly assessed the full spectrum of New York law’s required factors for determining a fair fee.
The panel noted that the court briefly referenced the contingency-fee percentage but neglected to weigh surrounding context—such as case complexity, time expended, customary local rates, the stage of litigation, and the ultimate results achieved.
The panel also faulted the court for overlooking one of Rasmy’s major contentions: that “nearly all the discovery and motion practice” had been completed before Diederich ever joined the case.
“In sum, because the district court did not address ‘the various factors generally considered when determining a quantum meruit recovery,’ we conclude that the charging lien should be vacated,” the panel wrote, sending the matter back down for a fresh look.
