Dawda, Mann, Mulcahy & Sadler, P.L.C. v. Bank Of America, N.A

62 F.Supp.3d 651 (2014)

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Nature of the Case

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Facts

P is a law firm. P's former partner Flaska defrauded P by laundering funds through D. Flaska presented and deposited checks drawn on P's Interest on Lawyer's Trust Account (IOLTA) into Flaska's personal bank account maintained by D. D received and credited nine of these checks into Flaska's account, totaling $529,676.50. All of the checks were drawn from P's IOLTA account and were payable on their face to 'Bank of America.' P was not one of D's customers and was not indebted to D. D never inquired into these checks before crediting them to Flaska's account. P sued D alleging four counts including (1) breach of the common law duty of inquiry; (2) common law conversion; (3) statutory conversion; and (4) negligence. P proceeds solely on Counts 1 and 4. D motioned to dismiss under 12(b)(6) for failure to state a claim because it owed no duty to P and was also an HDC.