United States District Court, D. South Dakota, Southern Division
TERESA ANN THOMPSON, INDIVIDUALLY AND AS SPECIAL ADMINISTER OF THE ESTATE OF WINFIELD THOMPSON, SR., DECEASED; MELISSA PROCHNOW, AS SPECIAL ADMINISTRATORS/PERSONAL REPRESENTATIVES OF THE ESTATE OF NICHOLAS HELGESON; AND JAMIE HELGESON, AS SPECIAL ADMINISTRATORS/PERSONAL REPRESENTATIVES OF THE ESTATE OF NICHOLAS HELGESON; Plaintiffs,
WILLIAM HARRIE, THE NILLES LAW FIRM, NODAK INSURANCE COMPANY, NODAK MUTUAL GROUP, INC., A MUTUAL HOLDING COMPANY; AND N.I. HOLDINGS, INC., AN INTERMEDIATE STOCKHOLDING COMPANY; Defendants.
ORDER GRANTING MOTION TO DISMISS
E. SCHREIER UNITED STATES DISTRICT JUDGE.
Teresa Ann Thompson, individually and as special administer
of the estate of Winfield Thompson, Sr., deceased, the estate
of Winfield Thompson, and Melissa Prochnow and Jamie
Helgeson, as special administrator(s)/personal
representative(s) of the estate of Nicholas Helgeson, filed a
complaint in state court alleging legal malpractice, fraud
and deceit, civil conspiracy, barratry/abuse of process,
breach of contract, breach of duty of good faith and fair
dealing, bad faith, breach of fiduciary duty, and claims for
attorney fees, exemplary damages, and punitive damages
against defendants William Harrie, the Nilles Law Firm
(collectively “the lawyer defendants”), Nodak
Insurance Company, Nodak Mutual Group, Inc., and N.I.
Holdings, Inc. (collectively “Nodak”). Docket
1-2. Defendants removed the case to this court. Docket 1. The
lawyer defendants move to dismiss all claims asserted against
them by plaintiffs under Fed.R.Civ.P. 12(b)(6). Docket
The lawyer defendants also move the court to take judicial
notice of the entire court file in Thompson v.
Harrie, 4:18-cv-04022-KES. Docket 7. Both Nodak and
plaintiffs oppose the lawyer defendants' motion to
dismiss. Dockets 18, 19. For the reasons that follow, the
court grants the lawyer defendants' motion to dismiss.
facts alleged in the complaint, accepted as true, are as
follows: Winfield Thompson passed away as a result of
injuries sustained in a 2009 motor vehicle accident with
Nicholas Helgeson in South Dakota. In 2012, Teresa Thompson,
daughter of Winfield Thompson, brought a wrongful death
action in South Dakota against Helgeson, a resident of North
Dakota. At the time of the motor vehicle accident, Helgeson
(now deceased) was an insured under Nodak's automobile
insurance policy. Nodak hired the lawyer defendants, located
in Fargo, North Dakota, to defend Helgeson in the wrongful
death action brought by Teresa Thompson. In 2014, Teresa
Thompson's attorney sent a letter to Harrie, which
included a settlement demand to Winfield Thompson's
estate for the policy limit of $100, 000. There was no
response from Harrie, the Nilles Law Firm, Nodak, or
filed pleadings on behalf of Helgeson and appeared as counsel
for Helgeson at a deposition and in two court hearings.
Harrie was and is licensed to practice law in North Dakota,
but he was not licensed to practice law in South Dakota and
was not admitted pro hac vice to practice in South Dakota for
the wrongful death action. As a result, the state court
entered a default judgment against Helgeson. At a trial on
damages, a jury awarded $127, 000 to Winfield Thompson's
estate, and a judgment was entered in favor of Thompson's
estate and against Helgeson's estate.
Teresa Thompson, individually and as special administer of
the estate of Winfield Thompson, and the estate of Winfield
Thompson brought four causes of action against the lawyer
defendants and Nodak in Thompson v. Harrie,
4:18-cv-04022-KES: unauthorized practice of law, fraud and
deceit, civil conspiracy, and barratry/abuse of process. This
court granted the lawyer defendants' motion to dismiss
all counts and Nodak's motion to dismiss all counts.
See id., Dockets 21, 22.
Thompson plaintiffs subsequently entered into an agreement
with the Helgeson estate. Thompson's estate agreed not to
execute on its judgment against Helgeson's estate in
exchange for an assignment of the Helgeson estate's
potential claims against the lawyer defendants and Nodak. The
parties entered into a written agreement formalizing the
assignment on December 26, 2018. Melissa Prochnow and Jamie
Helgeson, special administrators of the Helgeson estate, and
the Helgeson estate are now listed as plaintiffs in this
lawsuit. Other than the assignment of claims against the
lawyer defendants and Nodak, plaintiffs' current lawsuit
alleges the same underlying facts as the previous lawsuit and
brings the same claims, with a few additional claims against
may dismiss a complaint for “failure to state a claim
upon which relief can be granted.” Fed.R.Civ.P.
12(b)(6). “To survive a motion to dismiss, a complaint
must contain 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 (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.
“The plausibility standard is not akin to a
‘probability requirement,' but it asks for more
than a sheer possibility that a defendant has acted
court determines plausibility by considering the materials in
the pleadings and exhibits attached to the complaint, by
drawing on experience and common sense, and by viewing the
plaintiff's claim as a whole. Whitney v. Guys,
Inc., 700 F.3d 1118, 1128 (8th Cir. 2012). Inferences
are construed in favor of the non-moving party. Id.
at 1129 (citing Braden v. Wal-Mart Stores, Inc., 588
F.3d 585, 595 (8th Cir. 2009)). The court may also
“consider ‘those materials that are necessarily
embraced by the pleadings.' ” Hughes v. City of
Cedar Rapids, 840 F.3d 987, 998 (8th Cir. 2016) (quoting
Schriener v. Quicken Loans, Inc., 774 F.3d 442, 444
(8th Cir. 2014)). “Those materials include
‘documents whose contents are alleged in a complaint
and whose authenticity no party questions, but which are not
physically attached to the pleadings.' ”
Id. (quoting Kushner v. Beverly Enters.,
Inc., 317 F.3d 820, 831 (8th Cir. 2003)). Materials that
are part of the public record may also be considered in
ruling on a motion to dismiss under Rule 12(b)(6). Porous
Media Corp. v. Pall Corp., 186 F.3d 1077, 1079 (8th Cir.
lawyer defendants contend that only two claims in
plaintiffs' complaint are asserted against the lawyer
defendants: legal malpractice in count 1 and punitive damages
in count 5. Docket 6 at 8. In response, plaintiffs do not
appear to object to this contention. See Docket 19.
Thus, the court will only address these two claims.
South Dakota law, a claim for legal malpractice requires four
elements: (1) an attorney-client relationship that creates a
duty, (2) the attorney breached that duty, (3) the
attorney's breach proximately caused an injury to the
client, and (4) the client sustained damages. Hamilton v.
Sommers, 855 N.W.2d 855, 862 (S.D. 2014). In the
previous lawsuit, this court determined that the Thompson
plaintiffs failed to state a claim against the lawyer
defendants for legal malpractice because the lawyer
defendants, as counsel for Helgeson in the underlying
litigation with Thompson, did not have an attorney-client