Schulz v. Laszlo & Associates, LLC.
2025 COA 24. No. 23CA0675. Civil Procedure—Attorney Fees—Tort Actions Dismissed Pursuant to CRCP 12(b)—Amended and Supplemental Pleadings—Amendments as a Matter of Course.
February 27, 2025
Bonner, Wood, and Schulz formed CLN Holdings, LLC (CLN) to acquire and manage Parrott’s Sports Grill, Inc. (Parrott’s), and Schulz became Parrott’s general manager. CLN retained Laszlo & Associates, LLC, Theodore E. Laszlo, Jr., and Michael J. Laszlo (Laszlo defendants) to complete corporate documents converting CLN from a limited liability company to a corporation and to provide the company with legal advice. Bonner then fired Schulz, and Schulz sued Bonner, Wood, CLN, and Parrott’s (CLN defendants) for economic and noneconomic damages and judicial dissolution of CLN (the CLN action). Laszlo defendants appeared as counsel for CLN defendants in the CLN action. Schulz then filed this derivative action on behalf of CLN, asserting various claims against Bonner and Wood and against Laszlo defendants. As a result, Laszlo defendants withdrew as counsel for CLN defendants in the CLN action. Laszlo defendants moved to dismiss the derivative complaint under CRCP 12(b)(1), and the district court granted the motion without prejudice. Laszlo defendants then moved for an award of attorney fees and costs. Schulz requested and was granted an initial extension of time to respond to the motion and to amend the complaint in the derivative action under Rule 15(a). In the meantime, the jury in the CLN action found in favor of Schulz and against Bonner and Wood on all claims and counterclaims and awarded Schulz damages. Schulz subsequently filed an amended complaint that incorporated the jury’s findings from the CLN action, reasserted multiple claims against Bonner and Wood, and asserted an amended declaratory judgment claim against all defendants, including Laszlo defendants. Schulz also filed an opposition to Laszlo defendants’ motion for attorney fees and costs. As relevant here, the district court dismissed the entire action as to all defendants because a receiver had been appointed for CLN, which divested Schulz of his ability to pursue derivative claims on behalf of CLN; and it denied Laszlo defendants’ motion for attorney fees.
On appeal, Laszlo defendants contended that the district court erred by allowing Schulz to amend his complaint. Under Rule 15(a), a party may amend a pleading once as a matter of course before a responsive pleading is filed and if a final judgment has not been entered. Here, none of the defendants filed an answer to Schulz’s original complaint, and Laszlo defendants conceded that a motion to dismiss is not a responsive pleading that cuts off a plaintiff’s right to amend a complaint as a matter of course under Rule 15(a). And a final judgment had not been entered in the case, so Schulz was entitled to amend his complaint.
Laszlo defendants also argued that the district court erred by denying their motion for attorney fees under CRS § 13-17-201. Section 13-17-201(1) generally entitles a defendant to an attorney fees award when all claims against that defendant have been dismissed on a pretrial motion filed under Rule 12(b). But here, after the court dismissed Schulz’s claims against Laszlo defendants, Schulz properly amended his complaint as a matter of course under CRCP 15(a) to assert another claim against them, and the court later dismissed that claim on its own motion. Because Laszlo defendants did not file, and the district court did not grant, a motion under Rule 12(b) to dismiss the last claim asserted against them in the amended complaint, they are not entitled to recover their attorney fees under the plain language of § 13-17-201. Accordingly, the district court did not err.
The court of appeals also denied Schulz’s request for appellate attorney fees under C.A.R. 38.
The order was affirmed.