PLLC v. Ricardo Berner and Practiko

Background

Rakower Law PLLC represented Ricardo Berner and Practiko, LLC in connection with litigation against Berner’s former employer. The engagement terms provided for hourly fees, monthly invoices, payment upon presentation, and a 15% annual late fee on invoices unpaid for more than 30 days. The Firm later sought to recover allegedly unpaid amounts from a July 2018 invoice, invoices issued from December 2018 through November 2019, and interest.

The Firm asserted an account stated claim. An account stated is a claim that the parties agreed an account was accurate and that a specified balance was owed. The Firm argued that Defendants’ failure to make timely, specific objections and their partial payments showed agreement with the invoices. Defendants disputed the charges, asserted that they objected orally and in writing, and contended that their payments were made under an alleged oral agreement allowing them to make payments as they could while resolving billing differences later.

Choice of Law

The Firm argued that New York law governed, while Defendants argued for Florida law. The court rejected the Firm’s argument that Defendants had waived their choice-of-law position through earlier filings. The court found no actual conflict between New York and Florida law concerning the account stated claim and therefore applied New York law.

Under the court’s formulation, the Firm had to show that an account was presented, that Defendants accepted it as correct, and that Defendants promised to pay the stated amount. Acceptance and a promise to pay can sometimes be inferred when a debtor keeps an invoice without timely objection or makes a partial payment. But the court concluded that the record presented factual disputes about whether those inferences were appropriate here.

Analysis

The court found evidence that Berner promptly rejected the July 2018 invoice and objected that the work was excessive, unnecessary, or duplicative. Later communications also indicated that the July invoice remained disputed. Although Defendants made a payment that they acknowledged was partly for the July invoice, Berner stated that the issue had not been fully resolved.

For the December 2018 through November 2019 invoices, Berner testified that Defendants objected to most or all of the invoices. The court found that objections directed to disputed invoices need not identify every disputed billing entry to create a factual issue. The court also noted that Defendants’ payments during this period were round amounts that did not match particular invoice balances, supporting their position that the payments were made under the alleged oral arrangement rather than as acceptance of specific invoices.

The court declined to disregard Berner’s deposition testimony merely because it was favorable to Defendants. The testimony was consistent with his March 2020 email stating that he intended to pay when he had the funds but could not yet confirm the amount because some months of billing still needed review.

Disposition

The court held that Defendants had identified a genuine dispute about whether Berner impliedly accepted the Firm’s invoices. Because that factual dispute prevented judgment without a trial, the court denied Rakower Law PLLC’s motion for summary judgment on its account stated claim in its entirety. The court did not separately decide the Firm’s entitlement to interest because that issue depended on whether the underlying billed amounts were recoverable and whether the parties had agreed not to charge interest. The court referred the action to the designated Magistrate Judge for general pretrial management.