Rubakha v. Kenneth J. Breitbart & Associates, PA et al
MEMORANDUM. Signed by Judge Catherine C. Blake on 5/30/14. (hmls, Deputy Clerk)
IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF MARYLAND
KENNETH J. BREITBART &
Civil No. CCB-13-2670
Plaintiff Sabina Rubakha filed this action against Kenneth J. Breitbart & Associates, P.A.
(“Breitbart”) claiming the defendant violated the Fair Debt Collection Practices Act (“FDCPA”)
in its attempts to collect a debt Rubakha owed. At the close of discovery, Rubakha filed a
motion to voluntarily dismiss the action with prejudice. (ECF No. 16.) Although Breitbart does
not oppose the dismissal, it seeks to have dismissal conditioned on the payment of its attorney’s
fees by Rubakha and her counsel, Sergei Lemberg. For the reasons below, Rubakha’s motion to
dismiss will be granted and will not be conditioned on the payment of Breitbart’s fees.
Breitbart represented CACH, LLC (“CACH”) in its attempts to collect a debt owed by
Rubakha. (See Def.’s Opp’n Ex. 1, ECF No. 18-1.) CACH obtained a default judgment against
Rubakha on September 8, 2008, for $2,912.30, (id.), but had difficulty obtaining assets from her
to satisfy it. According to the complaint in this case, filed on September 13, 2013, and amended
on November 7, 2013, Breitbart made repeated harassing phone calls to Rubakha to attempt to
collect the debt, even after she sent the law firm a cease and desist letter, and falsely represented
to her that it was calling on behalf of “the bank”. (Am. Compl., ECF No. 8, ¶¶ 16-21.) The case
proceeded through discovery, which closed April 21, 2014. (See Scheduling Order, ECF No.
13.) In discovery, Rubakha served interrogatories and requests for document production on
Breitbart, to which Breitbart provided responses. (See Def.’s Opp’n Exs. 8, 9, ECF Nos. 18-8,
18-9.) On the same day discovery closed, Rubakha filed her motion to dismiss. Breitbart claims
Rubakha and her counsel brought and maintained the lawsuit in bad faith and that dismissal thus
should be granted with the condition that Rubakha and her counsel pay its attorney’s fees
pursuant to 28 U.S.C. § 1927 and 15 U.S.C. § 1692k.1
28 U.S.C. § 1927 provides for the imposition of sanctions on attorneys who “multiply
proceedings” and thus abuse the court process. DeBauche v. Trani, 191 F.3d 499, 511 (4th Cir.
1999). An attorney cannot be sanctioned under § 1927 just because the claim ultimately is found
meritless. See id. Instead, he must have “multiplie[d] the proceedings . . . unreasonably and
vexatiously.” Id. (internal quotation marks and citation omitted). Bad faith on the part of the
attorney is a precondition to sanctions under the statute. Equal Employment Opportunity
Comm’n v. Great Steaks, Inc., 667 F.3d 510, 522 (4th Cir. 2012). The Fourth Circuit has found
bad faith where an attorney brought a claim under circumstances indicating he knew it had no
reasonable basis. See Chaudhry v. Gallerizzo, 174 F.3d 394, 411 (4th Cir. 1999); see also Knorr
Brake Corp. v. Harbil, Inc., 738 F.2d 223, 227 (7th Cir. 1984) (finding that sanctions under §
1927 could be imposed only where an attorney intentionally filed a claim lacking any plausible
basis).2 Breitbart has failed to demonstrate Lemberg filed this lawsuit, or maintained it, with
such knowledge here.
Breitbart does not move for sanctions under Federal Rule of Civil Procedure 11.
The court notes that the standard Breitbart cites from the Sixth Circuit is not actually its articulation of what is
required for a finding of bad faith. See Jones v. Continental Corp., 789 F.2d 1225, 1230 (6th Cir. 1986).
According to Breitbart, Lemberg’s bad faith in filing suit is evidenced by his alleged
failure to reasonably investigate Rubakha’s claim beforehand. Breitbart apparently believes that,
had Lemberg properly investigated, he would have discovered Rubakha’s claims were meritless.
As support, Breitbart points to 1) the fact that Lemberg’s website boasts he has handled over
8,000 cases, (Def.’s Opp’n Ex. 10, ECF No. 18-10); 2) Rubakha’s testimony at an April 2, 2014,
hearing in the underlying collection suit that she talked to Lemberg for five minutes to provide
him with information about the case when she first contacted him, (Def.’s Opp’n Ex. 5, ECF No.
18-5, at 23:17-24:5); and 3) the complaint’s incorrect identification of the debt, (see Def.’s
Opp’n Ex. 6, ECF No. 18-6, ¶ 8). The court notes first that there is no indication of the
timeframe in which Lemberg has handled 8,000 cases. Accordingly, this fact alone provides no
evidence of his or his law firm’s workload and ability to investigate a case at any one time.
Further, although Rubakha’s testimony regarding her interactions with Lemberg indicates
Lemberg may have failed to inform his client adequately of what was going on in the
proceedings, it is not evidence that he knew her claim was entirely without merit, or
unreasonably failed to investigate it, before filing suit. Indeed, it provides no evidence of what
they even talked about. Similarly, the identification of the incorrect debt in the complaint
indicates Lemberg needs to take more care in drafting his filings, but it alone cannot provide the
basis of demonstrating bad faith.
Breitbart also claims Lemberg’s bad faith is evidenced by his failure to dismiss the
lawsuit immediately upon discovering that a relevant document was not in the possession of
either Rubakha or Breitbart, or as soon as Rubakha asked him to dismiss it. First, Breitbart
mischaracterizes Rubakha’s testimony regarding the dismissal of the lawsuit. She testified that it
was her attorney who told her the claim should be dismissed, (Def.’s Opp’n Ex. 5 at 22:21-23:2,
25:19-26:8), not that she initially asked that it be dismissed. Indeed only 17 days after she
testified, on April 21, 2014, Lemberg did in fact move to dismiss the claim on Rubakha’s behalf.
In addition, Lemberg’s failure to confirm to Breitbart his belief and communication to his client
that the case may need to be dismissed, (Def.’s Opp’n Ex. 7, ECF No. 18-7, at 6), does not mean
he was unreasonably continuing the litigation. In fact, it does not appear Breitbart expended any
resources in further defending the case between the date Breitbart sought confirmation and when
Rubakha moved to dismiss.
Second, that Lemberg knew by the end of December 2013 that neither party had the cease
and desist letter, (see Def.’s Opp’n Ex. 7 at 1-4), is not evidence sufficient to demonstrate
Lemberg continued the litigation knowing the claim was meritless. There is nothing to suggest
the existence of that letter was the sole basis on which Rubakha’s claims could move forward.
As Rubakha points out in her reply memorandum, she still could have testified to its existence,
although such evidence would likely not be as strong. In addition, Rubakha made claims
unrelated to the letter in her complaint. (See Am. Compl. at ¶¶ 26-29.) Further, it appears that,
at least through April 4, 2014, Lemberg was still waiting for Breitbart to produce some
discovery. (See Def.’s Opp’n Ex. 7 at 6.)
Instead of demonstrating bad faith, Breitbart has, at most, shown that Lemberg lacked
care in his relationship with Rubakha and work product and that he concluded, after discovery,
that it was better to dismiss the claim than to move forward with the evidence he did have. There
is nothing to suggest Lemberg intentionally filed or continued the lawsuit with knowledge that
Rubakha had no claim. Sanctions are not, therefore, warranted under 28 U.S.C. § 1927.3 See
Griffin Whitaker, LLC v. Torres, 2010 WL 3895384, at *5 (D. Md. Oct. 1, 2010) (noting that
“[c]ourts have imposed sanctions under [§ 1927] only when there is a clear showing of bad faith:
when the attorney’s actions are so completely without merit as to require the conclusion that they
must have been taken for some improper purpose.” (internal quotation marks and citation
Section 1692k(a)(3) of Title 15 of the United States Code also requires a showing of bad
faith. See 15 U.S.C. 1692k(a)(3) (stating the court may award attorneys’ fees to the defendant
where it finds an FDCPA action was “brought in bad faith and for the purpose of harassment”).
For the same reason Breitbart cannot recover attorney’s fees under § 1927, therefore, he cannot
recover attorney’s fees under § 1692k. See Shah v. Collecto, Inc., 2005 WL 2216242, at *14 (D.
Md. Sept. 12, 2005) (evaluating a claim for sanctions under § 1692k and noting that bad faith “is
not simply bad judgment or negligence, but implies the conscious doing of a wrong because of a
dishonest purpose or moral obliquity; . . . it contemplates a state of mind affirmatively operating
with furtive design or ill will.” (quoting Black’s Law Dictionary 139 (6th ed. 1990)) (internal
quotation marks omitted)).
Breitbart also claims Rubakha had bad motives in filing suit. The claim is based on Rubakha’s testimony that the
federal lawsuit did not work because Breitbart did not stop its collection efforts and she did not get her money back.
(See Def.’s Opp’n Ex. 5 at 24:3-5.) That Rubakha, a lay person unfamiliar with law and legal process, characterized
her claims for unfair debt collection practices in this way is hardly evidence of some nefarious motive.
Unpublished cases are cited only for the soundness of their reasoning, not for any precedential value.
For the reasons stated above, Rubakha’s motion to dismiss will be granted and neither
she nor her counsel will be required to pay Breitbart’s attorney’s fees. A separate order follows.
May 30, 2014
Catherine C. Blake
United States District Judge
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