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Knopick v. Connelly

December 29, 2009


The opinion of the court was delivered by: Sylvia H. Rambo United States District Judge


Before the court is Defendants John J. Connelly, Jr., Susan M. Kadel, and James, Smith, Durkin and Connelly, LLP.'s motion to dismiss, (Doc. 4), Plaintiff's complaint pursuant to Federal Rule of Civil Procedure 12(b)(6) for failure to state a claim upon which relief can be granted. For the reasons that follow, Defendants' motion will be granted.

I. Background

A. Parties

Plaintiff Nicholas W. Knopick, a current resident of Arkansas who previously resided in Pennsylvania with his former wife. (Comp. ¶¶ 3, 8, 17). Defendants, relevant to the instant motion, are John J. Connelly, Jr. and Susan M. Kadel-- both are attorneys at Defendant firm of James, Smith, Durkin and Connelly, LLP ("Firm").*fn1 (Id. ¶¶ 4, 5, 6.) Plaintiff previously retained Defendants to represent him in a state court action involving a separation agreement between him and his wife. (Id. ¶ 21.)

B. Facts

On May 11, 1998, Plaintiff separated from his wife pursuant to a Separation and Property Settlement Agreement (the "Agreement") drafted by his attorney at the time. (Id. ¶ 8.) Plaintiff maintains that at the time of this Agreement, Ms. Knopick was fully aware of all if his assets, including approximately two million dollars worth of stock. (Id. ¶¶ 10, 14.) Plaintiff also contends that Ms. Knopick was aware, at the time of the Agreement, that the stock had little to no value because it was encumbered by a loan. (Id. ¶ 14.)

Under the Agreement, Plaintiff retained title to all real estate, assumed all mortgage obligations, and agreed to pay his Ms. Knopick $60,000. (Id. ¶ 12.) In addition, each spouse retained their respective personal property and waived any rights to the others' employment benefits. (Id. ¶ 13.) Each spouse also waived any rights regarding alimony or support. (Id. ¶ 15.)

On July 30, 1999, Plaintiff filed for divorce. (Id. ¶ 16.) Despite the Agreement, Ms. Knopick filed for an equitable distribution of the marital assets, alimony, alimony pendente lite, and other special relief on August 18, 1999, in the Court of Common Pleas of Perry County, Pennsylvania. (Id. ¶ 17.) Ms. Knopick claimed the Agreement was invalid because she was not aware of the two million dollars of stock held by Plaintiff. (Id. ¶ 18.) On March 16, 2000, Plaintiff sought enforcement of the Agreement in the Perry County Court of Common Pleas. (Id. ¶ 19.) At issue with the Agreement was whether Plaintiff had provided Ms. Knopick with a full and fair disclosure of his financial assets, including the two million in stock, before she signed the Agreements on May 11, 1998. (Id. ¶ 20.)

On October 31, 2001, Plaintiff retained Defendant Firm, and specifically Attorneys Connelly and Kadel, as his counsel. (Id. ¶¶ 22-24.) A hearing was to be held on the validity of the Agreement in mid-2004, prior to this date, Ms. Knopick offered to settle the case if Plaintiff would transfer to her $300,000 of his stock. (Id. ¶ 26.) Plaintiff consulted with Defendant Firm and was assured by Defendant Kadel that the Agreement was valid and that Ms. Knopick was not entitled to more than the $60,000 she already received. (Id. ¶ 27.) Defendant Kadel further assured Plaintiff that even if the Agreement was found to be invalid, Plaintiff would only have to pay Ms. Knopick the amount that the stock was worth at the time the Agreement was entered into which would have been zero dollars as the stock was encumbered by a two million dollar loan. (Id. ¶ 28.)

On August 2, 2004, a hearing was held in the Court of Common Pleas, Perry County, Pennsylvania, before the Honorable Kathy A. Morrow. (Id. ¶¶ 30, 34.) Defendant Kadel represented Plaintiff at this hearing. (Id. ¶ 30.) Plaintiff alleges he informed both Defendant Connelly and Defendant Kadel that the following witnesses would be able to testify that Ms. Knopick was aware of the two million dollars of stock at the time she entered into the Agreement:

1) Michael Hanft, Esquire, who represented Plaintiff at the time of the Agreement and who advised both parties of the other's assets.

2) Carl Wass, Esquire, who represented Ms. Knopick at the time the Agreement was entered. Attorney Wass advised Ms. Knopick not to sign the agreement and would presumably testify that Ms. Knopick and himself were aware of Plaintiff's assets.

3) Charles Pegg, the Knopicks' accountant, and his wife Becky Pegg, who would testify they made Ms. Knopick fully aware of the couple's finances every year. (Id. ΒΆ 32.) Neither Defendant Kadel nor Defendant Connelly called any of these witnesses at the hearing. Afterward, one or both attorneys assured ...

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