Engel & Engel v. Shuck CA2/2

FACTS AND PROCEDURAL BACKGROUND

I. Facts

A. The precursor lawsuit where plaintiff is hired Two persons solicited investments in a surgical building in Newport Beach from John and Judith DeLong (the DeLongs), from Leona Horowitz (Horowitz), and from Wells Fargo Equipment Finance, Inc. (Wells Fargo). When the solicitors did not deliver what was promised, the DeLongs, Horowitz, and Wells Fargo sued the solicitors in separate lawsuits for the misuse of their funds. In the spring of 2014, Engel & Engel, LLP (plaintiff) was retained to do forensic accounting in support of one or more of these pending lawsuits. One of its partners is Jason Engel (Engel). Initially, the DeLongs, Horowitz, and Wells Fargo discussed a pooling arrangement under which the three would split the cost of plaintiff’s services. Ultimately, however, only the DeLongs and Horowitz signed retainer agreements with plaintiff. Plaintiff worked on the pending lawsuits in May, June, and July of 2014, and billed over $110,000 in fees for those months. Pursuant to what it believed to be the pooling agreement, plaintiff allocated some of its fees each month to the DeLongs, Horowitz, and Wells Fargo. Horowitz paid…