Development Specialists, Inc. v. Peabody Energy Corp., 487 B.R. 375

Peabody retained Coudert in 1997 to obtain refunds of black lung excise taxes via litigation; the engagement explicitly contemplates litigation, not lobbying.
From 2003 to 2008 Coudert and later Baker engaged in substantial lobbying aimed at securing refunds, culminating in a 2008 act (EIEA) granting refunds to coal companies including Peabody (Peabody’s refund ≈ $59 million).
The 1997 engagement fee provision provides a 15% contingency on refunds, but the letter does not reference lobbying; Becker, initial partner, was not a lobbyist at signing.
Coudert dissolved in 2005; Becker joined Baker and Baker continued pursuit of refunds; the Plan Administrator—standing in Coudert/Baker’s shoes—seeks the contingency fee from Peabody as assignee of Baker’s rights.
Becker time entries and lobbying disclosures show lobbying activity listing Peabody as client, but Peabody allegedly did not know and the lobbying records were not sent to Peabody; litigation regarding interpretation of the fee and conduct proceeded.
The court held Peabody’s motion should grant summary judgment on the contract claim because the Agreement unambiguously excludes lobbying, but deny summary judgment on the Plan Administrator’s quasi-contract claims.

Issue	Plaintiff's Argument	Defendant's Argument	Held
Whether the Agreement covers lobbying.	Plan Administrator argues ambiguity; at least implictly includes lobbying.	Agreement unambiguous; confines representation to litigation before IRS/federal courts.	Unambiguous; does not cover lobbying.
Whether the Agreement was modified by post-signing conduct.	Post-signing lobbying work and related documents evidence modification.	No written modification; acquiescence insufficient to modify fee terms.	No valid modification shown.
Whether quasi-contract claims are barred by Clark-Fitzpatrick.	Quasi-contract claims survive for lobbying services outside the contract terms.	Clark-Fitzpatrick bars quasi-contract when contract covers the subject.	Not barred;extrinsic lobbying services can sustain quasi-contract claim.
Whether there is a genuine issue of material fact on the quasi-contract claims.	Baker’s lobbying benefited Peabody; there was an expectation of payment.	Any expectation depended on terms; period and scope are contested.	Yes, material factual dispute as to reliance/expectation; trial necessary.

Compagnie Financière de CIC et de L’Union Europeenne v. Merrill Lynch, Pierce, Fenner & Smith, Inc., 232 F.3d 153 (2d Cir.2000) (primary objective is to ascertain parties’ intent in contract terms)
Shaw v. Mfrs. Hanover Trust Co., 68 N.Y.2d 322 (N.Y. 1986) (contingent-fee agreements require clear terms; not to be read vacuously)
Clark-Fitzpatrick, Inc. v. Long Island R.R. Co., 70 N.Y.2d 382 (N.Y. 1987) (rule against using quasi-contract when a valid contract exists, with exceptions)
Law Debenture Trust Co. v. Maverick Tube Corp., 595 F.3d 458 (2d Cir.2010) (ambiguity resolved when contract language plain; extrinsic evidence limited)