BiotechPharma, LLC v. Ludwig & Robinson, PLLC

Notice: This opinion is subject to formal revision before publication in the

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DISTRICT OF COLUMBIA COURT OF APPEALS

No. 13-CV-546

BIOTECHPHARMA, LLC, et al., APPELLANTS,

V.

LUDWIG & ROBINSON, PLLC, APPELLEE.

Appeal from the Superior Court

of the District of Columbia

(CAB-884-13)

(Hon. Brian F. Holeman, Trial Judge)

(Argued October 31, 2013 Decided September 4, 2014)

Albert Wilson, Jr., for appellants.

Robert W. Ludwig, with whom Salvatore Scanio, James E. Tompert, and

W. Clifton Holmes were on the brief, for appellee.

Irvin B. Nathan, Attorney General for the District of Columbia, Todd S. Kim,

Solicitor General, Donna M. Murasky, Deputy Solicitor General, and James C.

McKay, Jr., Senior Assistant Attorney General, filed a brief for the District of

Columbia, amicus curiae, in support of this court‟s jurisdiction over the present

appeal.

Before FISHER and BLACKBURNE-RIGSBY, Associate Judges, and KING,

Senior Judge.

FISHER, Associate Judge: Appellants—BiotechPharma, LLC; Converting

Biophile Laboratories, Inc.; and Dr. Raouf Albert Guirguis (collectively “BTP”)—

2

are former clients of appellee Ludwig & Robinson, PLLC (“L&R”), a law firm.

L&R sued BTP to collect unpaid legal fees, and BTP moved to stay the litigation

and compel arbitration. After the trial court denied the motion, BTP brought this

interlocutory appeal, arguing mainly that District of Columbia Bar Rule XIII 1

obligates L&R to arbitrate the fee dispute. We agree with BTP, reverse the trial

court‟s order, and remand the case with instructions to compel arbitration.

I. Procedural and Factual Background

BTP, a biotechnology firm, retained L&R as counsel in March 2011 to help

resolve a trade secret dispute. The dispute was settled in May 2012, L&R having

billed BTP on a monthly basis during the course of its representation. By

June 2012 L&R claimed that BTP owed approximately $1.7 million in outstanding

legal fees, disbursements, and expenses. In January 2013 L&R brought suit to

collect its fees.

1

Although popularly known as “D.C. Bar Rule XIII,” this is actually a rule

of this court, adopted “for the government of the Bar and the individual members

thereof.” Preamble, Rules of the District of Columbia Court of Appeals Governing

the Bar of the District of Columbia.

3

Several weeks later, BTP responded to the complaint by filing a motion to

stay the trial court proceedings and compel arbitration. In addition to claiming that

L&R had expressly agreed to arbitrate the fee dispute, BTP argued that a binding

agreement to arbitrate had been formed by operation of law. BTP cited Rule 8 of

the D.C. Bar‟s Attorney/Client Arbitration Board (“ACAB”), which states that if a

client files a petition to arbitrate a fee dispute with a lawyer, “the lawyer is deemed

to have agreed to arbitrate.” Although it was not mentioned in the trial court,

D.C. Bar Rule XIII similarly provides that

[a]n attorney subject to the disciplinary jurisdiction of

[the District of Columbia Court of Appeals] shall be

deemed to have agreed to arbitrate disputes over fees for

legal services . . . when such arbitration is requested by a

present or former client, . . . if a substantial portion of the

services were performed by the attorney in the District of

Columbia . . . .

L&R raised several arguments opposing BTP‟s motion to stay litigation and

compel arbitration, although the firm had already acknowledged in its complaint

that it “maintains its office and performed work related to this” matter in the

District of Columbia. Ultimately, the trial court denied BTP‟s motion without

clearly explaining why. BTP now appeals from that order.

4

II. Analysis

Before reaching the merits of BTP‟s appeal, we first address a jurisdictional

issue raised by L&R. We then consider whether the parties to this case had an

enforceable arbitration agreement, and we conclude that such an agreement existed

pursuant to D.C. Bar Rule XIII. Finally, we treat (and reject) L&R‟s claims that

Rule XIII is unconstitutional and that this court exceeded its authority by

promulgating it.

A. Jurisdiction

L&R argues that we lack jurisdiction to hear this interlocutory appeal,

despite a provision of the Revised Uniform Arbitration Act (“RUAA”) that states:

“An appeal may be taken from . . . [a]n order denying or granting a motion to

compel arbitration.” D.C. Code § 16-4427 (a) (2012 Repl.). According to L&R,

the RUAA cannot serve as our jurisdictional predicate because it violates the

Home Rule Act, which prohibits the Council of the District of Columbia from

passing a law “with respect to any provision of Title 11 (relating to organization

and jurisdiction of the District of Columbia courts).” D.C. Code § 1-206.02 (a)(4)

(2012 Repl.). Among other things, Title 11 gives this court jurisdiction over

5

appeals from “final orders and judgments of the Superior Court” and interlocutory

orders “refusing . . . injunctions.” D.C. Code § 11-721 (a) (2012 Repl.). L&R

argues that orders denying motions to compel arbitration are not orders

“refusing . . . injunctions,” nor do they qualify as appealable orders under any other

provision of Title 11. Consequently, L&R asserts that the RUAA has

impermissibly expanded this court‟s jurisdiction, thereby violating the Home Rule

Act.

We disagree for two principal reasons. First, for more than twenty years,

this court has routinely exercised jurisdiction over the type of appeal presented

here. See Giron v. Dodds, 35 A.3d 433, 436-37 (D.C. 2012); 2200 M St. LLC v.

Mackell, 940 A.2d 143, 147 n.2 (D.C. 2007); Nat’l Trade Prod. v. Info. Dev., 728

A.2d 106, 109 (D.C. 1999); Benefits Commc’ns Corp. v. Klieforth, 642 A.2d 1299,

1301 n.10 (D.C. 1994); Friend v. Friend, 609 A.2d 1137, 1139 n.5 (D.C. 1992);

Hercules & Co., Ltd. v. Beltway Carpet Serv., Inc., 592 A.2d 1069, 1071-72

(D.C. 1991). In doing so, we have regularly cited either the RUAA or its

predecessor, the Uniform Arbitration Act (“UAA”), 2 as a proper basis for

2

The UAA stated that “[f]or purposes of writing an appeal . . . [a]n order

denying an application to compel arbitration” would “be deemed final.”

D.C. Code § 16-4317 (a) (2001). Unlike the RUAA, the UAA did not provide for

appeals from orders granting motions to compel arbitration. See id.

6

jurisdiction. See, e.g., Friend, 609 A.2d at 1139 n.5 (applying the UAA); Giron,

35 A.3d at 436-37 & n.1 (applying the RUAA). This history evinces our long-held

premise that interlocutory appeals from orders denying motions to compel

arbitration fit comfortably within our jurisdiction. That premise, which has

become part of our jurisprudence, has neither threatened our independence nor

otherwise proven unworkable, but L&R‟s position would require us to abandon it.3

Even if we set aside this extensive history (indeed, even if we set aside the

RUAA and the UAA altogether), a second consideration supports our jurisdiction

here. This court‟s 1981 decision in Brandon v. Hines involved an arbitration

agreement not subject to the UAA, and we nevertheless concluded that “denials—

but not grants—of stays of litigation pending arbitration are appealable

interlocutory orders.”4 439 A.2d 496, 507 (D.C. 1981). Several years later, in

3

L&R‟s jurisdictional arguments implicate many of the issues raised in

Stuart v. Walker, which this court recently heard en banc. 6 A.3d 1215

(D.C. 2010), vacated, 30 A.3d 783 (D.C. 2011) (en banc). However, Stuart dealt

with an order granting (rather than denying) a motion to compel arbitration.

6 A.3d at 1215. The en banc court was evenly divided on the question of

jurisdiction and failed to render an opinion. See Stuart v. Walker, No. 09-CV-900

(D.C. Feb. 16, 2012) (en banc) (unpublished judgment).

4

In Brandon, a contractor appealed a trial court order that denied his motion

to confirm an arbitration award, vacated the award, and directed the parties to trial.

439 A.2d at 497. In deciding that the order was immediately appealable under

Title 11 as an order dissolving an injunction, the court found it necessary to first

(continued…)

7

Hercules & Co., Ltd. v. Shama Rest. Corp., this court reaffirmed Brandon‟s rule

and explained that it “will remain the law of the District of Columbia unless and

until it is reconsidered en banc or modified by statute.” 566 A.2d 31, 38

(D.C. 1989).

Applying Brandon‟s rule to this case resolves the concern L&R raises

regarding the Home Rule Act, for if we may exercise jurisdiction pursuant to the

terms of Title 11, then the RUAA‟s provision for interlocutory appeals works no

change to this court‟s jurisdiction (at least, that is, with respect to orders denying

motions to compel arbitration). See Bank of Am. v. District of Columbia, 80 A.3d

650, 660-61 (D.C. 2013) (relying on Brandon and recognizing that “[t]his court has

exercised jurisdiction of an appeal from an order denying a motion to compel

arbitration, concluding that it is a final order, appealable pursuant to D.C. Code

§ 11-721 (a)(1)”).

(…continued)

determine that orders denying motions to compel arbitration should be treated (for

purposes of appeal) as orders refusing injunctions. Id. at 500-09.

8

L&R argues that Brandon was incorrect at the time it was decided because it

overlooked binding precedent in John Thompson Beacon Windows, Ltd. v. Ferro,

Inc., 232 F.2d 366 (D.C. Cir. 1956). However, the John Thompson court dealt

primarily with the finality of an order in an independent proceeding.5 Id. at 366-

69. By contrast, the Brandon court focused carefully on whether an order refusing

to stay ongoing litigation pending arbitration is appealable as an interlocutory order

refusing an injunction. 439 A.2d at 497, 500-09 (analyzing D.C. Code § 11-721).

Consequently, John Thompson did not control Brandon and does not control here.

See Parker v. K & L Gates, LLP, 76 A.3d 859, 864 n.3 (D.C. 2013) (“Because this

case arises in the context of an independent proceeding, we have no occasion to

consider the appealability of orders compelling arbitration in other contexts.”).

5

An independent proceeding is an action “in which a request to order

arbitration is the sole issue before the court.” Green Tree Fin. Corp.-Ala. v.

Randolph, 531 U.S. 79, 87 (2000). John Thompson involved an independent

proceeding because a seller had filed suit for the sole purpose of seeking

enforcement of an arbitration agreement. 232 F.2d at 366-67. The trial court

denied the seller‟s initial motion to compel arbitration, and the seller appealed

before the trial court could complete a statutorily prescribed process for summarily

trying the issue. Id. at 367. On appeal, then, the jurisdictional question was

whether the order appealed from represented the final resolution of the independent

proceeding. Id. at 367-69. Although neither party argued the order at bar was

injunctive, the court considered and rejected that possibility in cursory fashion. Id.

at 369. In doing so, the court based its brief analysis on the federal jurisdictional

statute, 28 U.S.C. § 1292 (1952). Id. Thus, John Thompson is distinguishable not

only because it arose in a different procedural setting, but also because it dealt with

a different jurisdictional statute than the one at issue here.

9

In summary, Brandon and Hercules remain binding authority and apply to

this case. Moreover, the result Brandon commands here is consistent with the long

line of cases in which we have exercised jurisdiction over appeals like this one.

We have no reason (and, in fact, no discretion) to depart from our precedent.

Having determined that we have jurisdiction to decide this appeal, we now turn to

the merits of BTP‟s claim.

B. L&R’s Agreement to Arbitrate

BTP argues that the trial court erred in denying its motion to stay litigation

and compel arbitration. Because a trial court must grant such a motion where a

valid arbitration agreement exists, see D.C. Code § 16-4407 (b) (2012 Repl.), the

central question before us is whether L&R and BTP had such an agreement.6 This

6

Before reaching the question of whether there was an agreement to

arbitrate, L&R would have us hold that there was not even a dispute to arbitrate.

See Reed Research, Inc. v. Schumer Co., 243 F.2d 602, 604-05 (D.C. Cir. 1957)

(relying on theory of “an account stated” to hold that no genuine issue of material

fact precluded summary judgment). However, BTP‟s first filing in this case avers

that the company “disputes the amount of attorney‟s fees sought” by L&R. This

statement is enough to establish the existence of a dispute. To compel arbitration,

a party need not produce evidence of a dispute sufficient to survive a motion for

summary judgment. Friend v. Friend, 609 A.2d 1137, 1139 (D.C. 1992).

10

is a question of law that we review de novo. Giron, 35 A.3d at 437. The relevant

facts are not in dispute.

1. Was There an Express Agreement to Arbitrate?

BTP suggests that because arbitration agreements are “irrevocable” under

the RUAA, emails from L&R communicating its willingness to arbitrate were

immediately binding. We disagree. Mere offers to arbitrate are not irrevocable,

and the record demonstrates that L&R‟s first offer to arbitrate was not accepted by

BTP. L&R‟s second offer was conditioned on ACAB‟s acceptance of BTP‟s

petition, and L&R revoked this conditional offer long before BTP filed such a

petition. Consequently, no express agreement to arbitrate was ever formed

between the parties.7

2. Was There an Implied Agreement to Arbitrate?

7

By specifying that an attorney “shall be deemed to have agreed to

arbitrate” when the client requests it, Bar Rule XIII empowers clients to

unilaterally require arbitration, but the rule does not give lawyers the same

prerogative. In fact, ACAB Rule 8 (b)(ii) specifically notes that for clients, the

arbitration service offered by ACAB “is voluntary. If the client does not agree to

arbitrate, the ACAB cannot compel the client to do so.” Thus, L&R‟s two offers to

arbitrate did not trigger mandatory arbitration.

11

BTP maintains, in the alternative, that an agreement was formed by

operation of law when it (the client) requested arbitration.

a. Was This Claim Preserved?

When raising this claim before the trial court, BTP failed to cite D.C. Bar

Rule XIII, relying solely on ACAB Rule 8. As we will soon explain, these rules

have somewhat different terms. L&R therefore contends that BTP failed to

preserve the claim on which it now relies. We disagree. See Tindle v. United

States, 778 A.2d 1077, 1082 (D.C. 2001) (quoting Salmon v. United States, 719

A.2d 949, 953 (D.C. 1997) (“[A]lthough „claims‟ not presented in the trial court

will be forfeited . . . , „parties on appeal are not limited to the precise arguments‟

they made in the trial court.”).

When moving for a stay of litigation pending the completion of arbitration,

BTP quoted ACAB Rule 8 (a) (“If the petition is filed by a client, the lawyer is

deemed to have agreed to arbitrate . . . .”). It elaborated: “All counsels entering an

appearance on behalf of Ludwig are members of the D.C. Bar; therefore, they are

all required to proceed to arbitration under the ACAB.” BTP thus identified the

12

principle underlying both rules. There is little risk that L&R, which had earlier

proposed arbitration before ACAB, a service provided by the Bar, was misled by

BTP‟s failure to cite Rule XIII.

b. Was There a Valid Request to Arbitrate?

Both ACAB Rule 8 and Bar Rule XIII give clients the power to require

arbitration of fee disputes. However, the rules employ different terms for the

triggering event. Under ACAB Rule 8, a “lawyer is deemed to have agreed to

arbitrate” when a “petition is filed by a client.” Under Bar Rule XIII, an attorney

“shall be deemed to have agreed to arbitrate” when “such arbitration is requested

by a present or former client.”

L&R points out that BTP did not file a petition with ACAB until after the

trial court had denied arbitration, asserting that BTP did not have a viable claim in

the trial court that arbitration was required pursuant to ACAB Rule 8. It also

argues that the only way a client may “request” arbitration under Rule XIII is by

filing a formal petition with ACAB.8

8

In support of this reading, L&R notes Rule XIII‟s statement that arbitration

“shall be pursuant to such reasonable rules and regulations . . . as may be

(continued…)

13

We conclude that a client need not file a formal petition with ACAB in order

to request arbitration pursuant to Bar Rule XIII. A formal filing with ACAB

certainly would be sufficient to effectuate such a request, but it is not an absolute

prerequisite. Here, BTP‟s counsel informed the trial court that he actually “tried

to” file a petition with ACAB. He also said that ACAB “will not accept the

petition until [the] Court stays [the] case.”9 Thus, trying to comply with ACAB‟s

requirements, BTP filed a motion in the trial court to stay litigation and compel

arbitration.

(…continued)

promulgated from time to time by” the D.C. Bar and ACAB. But Bar Rule XIII

specifically provides flexibility in attorney-client arbitration arrangements, stating

that “arbitration shall be before” ACAB “[u]nless the attorney and client agree

otherwise.” Because ACAB is not the exclusive forum for arbitration, its rules do

not necessarily limit the ways in which an arbitration agreement can be formed.

9

ACAB Rule 4 states that “[i]f there is a pending lawsuit in a court about a

fee dispute and the client files a petition involving the same fee dispute with the

ACAB . . . , the ACAB will not retain jurisdiction nor will it proceed to adjudicate

the fee dispute unless the lawsuit is dismissed or stayed.” But there may have been

some misunderstanding between ACAB personnel and counsel for BTP. In

another case, ACAB explained its rule in plain terms, informing litigants that a

“fee dispute [may] not continue in two parallel forums.” Louis Fireison & Assocs.,

P.A. v. Alkire, 6 A.3d 945, 953 (Md. Ct. Spec. App. 2010).

14

Even if BTP‟s efforts to file a petition with ACAB were not enough to

constitute a “request” to arbitrate, BTP formally and unequivocally signaled its

desire for arbitration by filing a motion to stay litigation and compel arbitration.

We hold that a client that files such a motion in court has “requested” arbitration

under Bar Rule XIII. 10 Accordingly, L&R “shall be deemed to have agreed to

arbitrate” this fee dispute.11

C. Validity of D.C. Bar Rule XIII

L&R challenges the validity of D.C. Bar Rule XIII on two grounds. First, it

claims that this court lacked authority to promulgate the rule. Second, L&R

challenges the rule‟s constitutionality. BTP maintains that we should not entertain

either of these arguments, since L&R raises them for the first time on appeal. As a

10

Perhaps other types of filings or communications will qualify as a request

for arbitration under Bar Rule XIII. We do not decide this question.

11

L&R argues that even if an arbitration agreement exists, this court should

nevertheless affirm on the ground that BTP, through conduct, waived its right to

arbitration. We do not consider this argument because our case law clearly states

that questions of waiver are “decided by the arbitrator, not the court.” Menna v.

Plymouth Rock Assur. Corp., 987 A.2d 458, 465 (D.C. 2010); see Woodland Ltd.

P’ship v. Wulff, 868 A.2d 860, 865 (D.C. 2005). We likewise reject L&R‟s claim

that an implied arbitration agreement necessarily fails for lack of mutuality.

Because the agreement is formed by operation of law, it need not (and, indeed,

cannot) exhibit all the hallmarks of an ordinary contract.

15

general rule, of course, we do not consider such belated arguments. See, e.g.,

District of Columbia v. Helen Dwight Reid Educ. Found., 766 A.2d 28, 34 n.3

(D.C. 2001). However,

an appellate court has discretion, in the interests of

justice, to consider an argument that is raised for the first

time on appeal if the issue is purely one of law,

particularly if the factual record is complete and a

remand for further factual development would serve no

purpose, the issue has been fully briefed, and no party

will be unfairly prejudiced.

Plainly, the validity of Bar Rule XIII is a purely legal issue, and we think

“the interests of justice” are best served if we address it here. L&R makes many of

the same claims raised in Stuart v. Walker, and the merits of that case were never

resolved because the court split evenly on the question of jurisdiction. See supra

note 3. Thus, L&R raises issues “of continuing importance” and “of great public

interest” that deserve our consideration. See Anderson v. Elliott, 555 A.2d 1042,

1045 (Me. 1989) (exercising discretion to reach and resolve questions about the

validity of Maine‟s mandatory arbitration system for legal fee disputes). We note

that “a remand for further factual development would serve no purpose,” and that

“no party will be unfairly prejudiced” by our decision to reach L&R‟s final

arguments. Helen Dwight Reid Educ. Found., 766 A.2d at 34 n.3.

16

1. Authority to Promulgate D.C. Bar Rule XIII

L&R contends that this court lacked authority to promulgate Bar Rule XIII.

Quite to the contrary, this court possesses broad authority to regulate the practice

of law, deriving much of this power from the District of Columbia Court

Reorganization Act of 1970. A portion of that Act, passed by Congress, provides

that “[t]he District of Columbia Court of Appeals shall make such rules as it deems

proper respecting the examination, qualification, and admission of persons to

membership in its bar, and their censure, suspension, and expulsion.” D.C. Code

§ 11-2501 (a) (2012 Repl.). Beyond this broad statutory grant of authority, the

court possesses significant inherent authority as well. In Sitcov v. District of

Columbia Bar, we relied upon the “almost universally accepted” proposition “that

the highest court in the jurisdiction is imbued with the inherent authority to define,

regulate, and control the practice of law in that jurisdiction.” 885 A.2d 289, 297

(D.C. 2005) (quoting Brookens v. Comm. on Unauthorized Practice of Law, 538

A.2d 1120, 1125 (D.C. 1988)).

Notably, the preamble to the rules we promulgated to govern the District of

Columbia Bar cites both the inherent and statutory authority of this court. Taken

17

together, these two sources of authority allow the court to regulate virtually every

aspect of legal practice in the District of Columbia, including the substance of fee

agreements. See D.C. R. Prof. Cond. 1.5. We readily conclude that this power

extends to the subject matter of Bar Rule XIII. See In re LiVolsi, 428 A.2d 1268,

1273 (N.J. 1981) (holding that if a court has “authority to control the substance of

the [attorney-client] fee relationship, then a power of a lesser magnitude

determining the procedure for resolving fee disputes must also be within [the

court‟s] province”).

L&R nevertheless asserts that the rule impermissibly alters the jurisdiction

of the D.C. courts, since it requires lawyers to arbitrate fee disputes that they would

otherwise litigate in civil actions. Additionally, L&R claims that this court

violated the Home Rule Act by vesting judicial authority in the non-lawyer

members of ACAB panels and by limiting the scope of judicial review. In making

these claims, L&R cites several cases from other jurisdictions where courts have

considered the type of judicial involvement or the scope of judicial review that

must be afforded as part of a mandatory arbitration process.

Importantly, the formation of any arbitration agreement pursuant to Bar

Rule XIII requires a manifestation of assent by both attorney and client. Clients

18

invoke the rule by requesting arbitration. Attorneys submit to the rule by

practicing law in the District of Columbia. Provided that Rule XIII is valid, it does

not affect the jurisdiction of the D.C. courts or violate the Home Rule Act any

more than any other agreement to arbitrate would do.

The rule need not provide for judicial review beyond that which is ordinarily

available following arbitration. See D.C. Code §§ 16-4423 to -4424 (2012 Repl.);

A1 Team USA Holdings, LLC v. Bingham McCutchen LLP, 998 A.2d 320, 322

(D.C. 2010) (concluding that under the RUAA, “this court‟s review of an

arbitration award is still extremely limited”); Schwartz v. Chow, 867 A.2d 230

(D.C. 2005) (upholding decision of the Superior Court confirming an arbitration

award by ACAB). Whatever quasi-judicial authority may be vested in ACAB (if

any), it is limited to fee disputes between members of this court‟s bar and clients

who have voluntarily chosen to submit to the board‟s determination. Nothing in

the Home Rule Act inhibits this court‟s ability to thus manage the affairs of its bar.

This court did not exceed its authority in promulgating the rule.

2. Constitutionality of D.C. Bar Rule XIII

19

Separately, L&R challenges D.C. Bar Rule XIII on constitutional grounds,

principally claiming that the rule denies lawyers their Seventh Amendment right to

a jury trial. The Seventh Amendment‟s guarantee extends to “suits in which legal

rights [are] to be ascertained and determined, in contradistinction to those where

equitable rights alone [are] recognized.” Curtis v. Loether, 415 U.S. 189, 193

(1974). In Simler v. Conner the Supreme Court concluded that the underlying

“case was in its basic character a suit to determine and adjudicate the amount of

fees owing to a lawyer by a client under a contingent fee retainer contract, a

traditionally „legal‟ action.” 372 U.S. 221, 223 (1963). The Court therefore held

that the Seventh Amendment guaranteed a jury trial. Id. Here, L&R‟s complaint

alleges that BTP breached a retainer contract under which it owes attorneys‟ fees.

Thus, L&R has initiated “a traditionally „legal‟ action” to which, presumptively, a

Seventh Amendment right attaches. 12 Consequently, we must address L&R‟s

contention that Bar Rule XIII violates the Seventh Amendment.13

12

This determination is consistent with our holding in Ginberg v. Tauber,

where an attorney sued his client under a quantum meruit theory, seeking the

reasonable value of legal services the attorney had provided. 678 A.2d 543, 544-

46 (D.C. 1996). There was no retainer agreement, but the client acknowledged that

he owed the attorney a reasonable fee. Id. at 549. As a result, “the only issue [to

be determined] . . . was what was a reasonable fee under the circumstances.” Id. at

550. The court held “that where it is undisputed that the client owes the attorney

some fee for his legal representation, but there is no agreement concerning how the

amount will be determined . . . , the trial court, not the jury, determines the amount

of fee to be paid.” Id. at 548. In short, Ginberg concluded, “the amount of the fee,

(continued…)

20

Although other jurisdictions impose rules similar to D.C. Bar Rule XIII, no

such rule has ever been struck down for denying an attorney‟s right to a jury trial.

Rather, it has been held that attorneys give up that right by practicing law in a

jurisdiction subject to the challenged rule. See Kelley Drye & Warren v. Murray

Indus., Inc., 623 F. Supp. 522, 527 (D.N.J. 1985) (holding that “the right to a jury

trial can be given up, as parties do when they agree to arbitrate”); Guralnick v.

Supreme Court of N.J., 747 F. Supp. 1109, 1116 (D.N.J. 1990) (following Kelley

Drye). This court has previously cited that analysis in taking care “to cast no doubt

upon the validity of D.C. Bar R. XIII.” Ginberg, 678 A.2d at 551 n.9 (citing

Kelley Drye).

(…continued)

unless the amount is fixed by the contract, is . . . for the court to determine.” Id. at

551 (emphasis added). Here, the parties executed fee agreements, and L&R asserts

that its legal fees are, in fact, fixed by contract.

13

Some state courts have held that their respective state constitutions do not

guarantee a jury trial for attorneys litigating fee disputes. See, e.g., Shimko v.

Lobe, 813 N.E.2d 669, 675, 678-81 (Ohio 2004); Anderson v. Elliott, 555 A.2d

1042, 1043, 1049-50 (Me. 1989). These cases do not address the Seventh

Amendment question presented here since the “Amendment applies only to

proceedings in courts of the United States, and does not in any manner whatever

govern or regulate trials by jury in state courts.” Minneapolis & St. Louis R.R. Co.

v. Bombolis, 241 U.S. 211, 217 (1916). However, “like other provisions of the Bill

of Rights,” the Seventh Amendment is “fully applicable to courts established by

Congress in the District of Columbia.” E.R.B. v. J.H.F., 496 A.2d 607, 610 n.6

(D.C. 1985) (citing Pernell v. Southall Realty, 416 U.S. 363, 370 (1974)).

21

Federal courts have taken a similar approach in analogous contexts. For

example, in Geldermann v. Commodity Futures Trading Comm’n, members of a

commodities exchange were required by law to submit “to customer-initiated

arbitration.” 836 F.2d 310, 311 (7th Cir. 1987). A member company challenged

the rule—in part on Seventh Amendment grounds—claiming that “membership

alone is not sufficient to constitute consent to arbitration and therefore cannot

establish a waiver of its constitutional right to an Article III forum.” Id. at 318.

The Seventh Circuit disagreed, explaining that consent to observe all applicable

rules and regulations was “a precondition of membership” in the exchange. Id.

Accordingly, the court held that the company was “not entitled to an Article III

forum” and that “the Seventh Amendment [was] not implicated.” Id. at 324. See

also Patten Sec. Corp., Inc. v. Diamond Greyhound & Genetics, Inc., 819 F.2d

400, 402 (3d Cir. 1987) (holding that a member of the National Association of

Securities Dealers was “bound by its rules . . . under which a customer may compel

arbitration”) (abrogation on other grounds recognized by Delgrosso v. Spang &

Co., 903 F.2d 234, 236 n.2 (3d Cir. 1990)); Paine, Webber, Jackson & Curtis v.

Chase Manhattan Bank, 728 F.2d 577, 580 (2d Cir. 1984) (holding that the rules of

a stock exchange were “sufficient in and of themselves” to compel a member to

22

submit to arbitration requested by a non-member “whether or not [the rules] are

incorporated in a purchase and sale agreement”).

Because an arbitration agreement necessarily embodies a waiver of the right

to trial by jury, a determination that there is a valid arbitration agreement here

would foreclose any claim L&R might have had to a jury trial. See GTFM, LLC v.

TKN Sales, Inc., 257 F.3d 235, 244 (2d Cir. 2001) (characterizing the factual

premise of a Seventh Amendment claim as “purely hypothetical” where one party

to a dispute had exercised its statutory right to compel arbitration); Geldermann,

836 F.2d at 323 (holding that where the parties have consented to arbitration, “the

Seventh Amendment simply does not apply”); Cremin v. Merrill Lynch, Pierce,

Fenner & Smith, Inc., 957 F. Supp. 1460, 1471 (N.D. Ill. 1997) (when “claims are

properly before an arbitral forum pursuant to an arbitration agreement, the jury trial

right vanishes”). A case-specific waiver of the right to a jury trial is not necessary.

Still, L&R contends that it cannot be deemed to have agreed to arbitrate

because at least some of its attorneys joined the District of Columbia Bar before

this court promulgated Bar Rule XIII in 1995. Lawyers are required to renew their

bar membership every year, however, and those who have done so since 1995

cannot now claim immunity from the rule. In any event, the legal work at issue

23

here took place in 2011 and 2012, long after Rule XIII was promulgated. The

attorneys‟ practice of law in this jurisdiction is enough to make them subject to

Rule XIII with respect to any fee dispute arising from that practice.14

We now turn to whether this court, through Bar Rule XIII, may require such

client-initiated arbitration without violating the Constitution. L&R obliquely

suggests that the rule places an unconstitutional condition on the privilege of

practicing law in the District of Columbia. Again, however, L&R fails to cite a

case—and we are not aware of any—where a litigant has prevailed on that theory

when challenging a mandatory arbitration system for attorney-client fee disputes.

Courts that have considered the issue have held that “[n]o one has an absolute right

to practice law,” Kelley Drye, 623 F. Supp. at 527, and “[t]he State may impose

reasonable conditions and limitations upon those who wish to exercise th[at]

14

Moreover, BTP and L&R signed retainer agreements in 2011 and 2012.

“[L]aws in effect at the time of the making of a contract form a part of the contract

„as fully as if they had been expressly referred to or incorporated in its terms.‟”

Double H Hous. Corp. v. Big Wash, Inc., 799 A.2d 1195, 1199 (D.C. 2002)

(quoting Farmers & Merchs. Bank of Monroe v. Fed. Reserve Bank of Richmond,

262 U.S. 649, 660 (1923)). Applying this principle of law in a case similar to this,

the Maryland Court of Special Appeals held that D.C. Bar Rule XIII had been

implicitly incorporated into a retainer contract and that the attorney who executed

it had “agreed to arbitrate a fee dispute with [his client] upon her request.”

Fireison, 6 A.3d at 953-54.

24

privilege.” Anderson, 555 A.2d at 1050 (Me. 1989) (quoting Kelley Drye, 623 F.

Supp. at 527).

“The interest of the States in regulating lawyers is especially great,” and they

“have broad power to establish standards for . . . regulating the practice of

professions.” Goldfarb v Virginia State Bar, 421 U.S. 773, 792 (1975). This

includes the right to establish and enforce rules governing the reasonableness of

attorney fees. See D.C. R. Prof. Cond. 1.5. When promulgating Bar Rule XIII,

this court sought to provide an informal and efficient means of resolving attorney-

client fee disputes, which are one of the principal sources of public dissatisfaction

with the legal system. See Anderson, 555 A.2d at 1049. Because clients are at a

significant disadvantage in litigating those disputes, the rule protects their ability to

present meritorious claims and defenses, and, we believe, thereby fosters public

confidence in the bar. See id.; see also In re LiVolsi, 428 A.2d at 1272, 1280.

Thus, regulation “in the area of fee disputes” is “critically important.” Nodvin v.

State Bar of Ga., 544 S.E.2d 142, 145 (Ga. 2001) (quoting In re LiVolsi, 428 A.2d

at 1272).

The scope of Bar Rule XIII is well-fitted to its ends. The rule does not, for

instance, require lawyers to give up their right to a jury trial in civil cases not

25

involving fee disputes, and arbitration of fee disputes is required only if the client

requests it. Moreover, the arbitration system itself provides an impartial tribunal

and the other elements of due process. These considerations support our

conclusion that requiring lawyers to submit to client-initiated arbitration “is an

entirely reasonable exercise of the judicial power to superintend the bar.”

Anderson, 555 A.2d at 1049.15

In addition to its Seventh Amendment claim, L&R maintains that

compulsory arbitration denies lawyers their right to due process. Similar claims

have unvaryingly failed in the courts that have heard them. See Guralnick, 747 F.

Supp. at 1113-14; A. Fred Miller, Attorneys at Law, P.C. v. Purvis, 921 P.2d 610,

617-18 (Alaska 1996); Nodvin, 544 S.E.2d at 145-46. We see no reason to part

ways with this consistent body of persuasive precedent. “[D]ue process is not

necessarily judicial process. . . . [N]either is the right of appeal essential to due

15

On this score as well, our conclusion is consistent with analogous federal

case law. In Geldermann—described above—the law compelling arbitration for

members of the commodities exchange was upheld despite the claim that if a

member company “was to continue in business, [it] had no choice but to accept

the” rule. 836 F.2d at 317. See also Koveleskie v. SBC Capital Mkts., Inc., 167

F.3d 361, 366, 368 (7th Cir. 1999) (holding that it was not unconstitutional for an

employer to require an arbitration agreement as a “take-it-or-leave-it” condition of

employment, in part because “[t]he right to an Article III forum is waivable”).

26

process of law.” Guralnick, 747 F. Supp. at 1113 (quoting Reetz v. Michigan, 188

U.S. 505, 507-08 (1903)). Rather, “[t]he crux of due process is an opportunity to

be heard and the right to adequately represent one‟s interests.” A. Fred Miller,

Attorneys at Law, P.C., 921 P.2d at 617-18. Arbitration procedures under ACAB

rules “readily satisfy these minima.” Id.16

III. Conclusion

There was a valid agreement to arbitrate pursuant to D.C. Bar Rule XIII and

the trial court should have enforced it. Accordingly, we vacate the trial court‟s

order denying BTP‟s motion to stay, and remand the case with instructions to

enforce the arbitration agreement.

It is so ordered.

16

L&R also raises an argument that it has styled as an equal protection

claim. The firm asserts that Bar Rule XIII is “vastly overinclusive” because “it

routes to arbitration oft-times complex matters.” L&R does not explain how the

complexity of some attorney-client fee disputes works any deprivation of equal

protection under the law. In our view, the suggestion that this fee dispute is too

complex for ACAB is simply another facet of L&R‟s due process claim, which we

have already rejected.