D'OTTAVIO v. SLACK TECHNOLOGIES

Filing 36

OPINION. Signed by Judge Noel L. Hillman on 4/15/2019. (tf, )

UNITED STATES DISTRICT COURT
DISTRICT OF NEW JERSEY

GINO D'OTTAVIO,
individually and on behalf of
all others similarly
situated,

1:18-cv-09082-NLH-AMD
OPINION

Plaintiff,
v.
SLACK TECHNOLOGIES,
Defendant.

APPEARANCES:
ARI HILLEL MARCUS
YITZCHAK ZELMAN
MARCUS ZELMAN, LLC
701 COOKMAN AVENUE
SUITE 300
ASBURY PARK, NJ 07712
On behalf of Plaintiff
PAUL JEFFREY BOND
MARK S. MELODIA
HOLLAND & KNIGHT LLP
2929 ARCH STREET
SUITE 800
PHILADELPHIA, PA 19104
On behalf of Defendant
HILLMAN, District Judge
Plaintiff, Gino D’Ottavio, filed a putative class action
alleging that Defendant, Slack Technologies, transmitted dozens
of unsolicited commercial text messages to Plaintiff on
Plaintiff’s cellular telephone, in violation of the Telephone

Consumer Protection Act, 47 U.S.C. § 227 et seq., (“TCPA”),
thereby invading Plaintiff’s privacy. 1

Plaintiff claims that

after he signed up at slack.com, he began to receive tens of
unsolicited text messages.

Plaintiff claims that even though he

contacted Slack by email to request that Slack cease sending him
text messages, Slack’s unwanted text messages continued.
Plaintiff alleges that Slack’s violation of the TCPA entitles
him, and every other similarly situated class member, to an award
of $500.00 to $1,500 in statutory damages for each violation.
Slack filed an answer to Plaintiff’s complaint denying his
claims and lodged a counterclaim.

Slack contends that Plaintiff

abused a feature on Slack’s website to deliberately send himself
the texts at issue.

Slack alleges that this feature was designed

to allow desktop users of Slack to download and use a version of
the application on their mobile devices, but instead Plaintiff
abused the feature 1,590 times to send himself 1,590 texts to
trump up his baseless TCPA lawsuit.

Slack alleges that each text

was an act of fraud by Plaintiff, intended to manufacture
“injury” and a baseless demand for recovery.
Slack alleges that Plaintiff is well-versed in the TCPA,
having brought five separate actions under the TCPA against a

1

The Court has subject matter jurisdiction over Plaintiff’s
complaint under 28 U.S.C. § 1331.
2

range of companies before suing Slack. 2

Slack contends that it is

entitled to dismissal of Plaintiff’s case and its costs in
responding to Plaintiff’s transparent sham.

Slack has alleged

counterclaims against Plaintiff for wanton and willful
misconduct, common law fraud, breach of express contract, and
breach of the implied covenant of good faith and fair dealing.
(Docket No. 6.)
Plaintiff filed an answer to Slack’s counterclaims.
“Plaintiff categorically denies using any feature of Slack to
text himself 1,590 times or that he engaged in the conduct
alleged by Defendant.”

(Docket No. 15 at 3, ¶ 26.)

Presently before the Court are three motions: Slack’s motion
for sanctions against Plaintiff and his counsel pursuant to
Federal Civil Procedure Rule 11 (Docket No. 28), Plaintiff’s
counsel’s motion to withdraw as counsel for Plaintiff (Docket No.
30), and Plaintiff’s motion to dismiss his complaint with
prejudice (Docket No. 31).

2

Slack does not oppose Plaintiff’s

D’Ottavio v. Protection 1 Alarm Monitoring, Inc., 3:15-cv01136-MAS-DEA (closed August 24, 2016, judgment in Plaintiff’s
favor in the amount of $3,000); D’Ottavio v. Citibank, Inc.,
1:16cv-00621-RMB-AMD (dismissed on May 2, 2017 pursuant to a
private settlement); D’Ottavio v. Capital One Bank (USA), N.A.,
1:16-cv-09478-NLH-KMW (dismissed on September 14, 2017 pursuant
to a private settlement); D’Ottavio v. Etan Industries, 1:18-cv02269-JHR-KMW (case open, pending motion by counsel to withdraw,
filed on December 31, 2018). Plaintiff’s counsel’s motion to
withdraw in this case was filed on October 1, 2018.
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motion to dismiss his complaint, so long as it is with prejudice,
and it takes no position on Plaintiff’s counsel’s motion to
withdraw.

Slack points out that the dismissal of Plaintiff’s

complaint and the resolution of counsel’s motion to withdraw do
not resolve Slack’s motion for sanctions in the form of Slack’s
attorney’s fees and costs, and Slack’s counterclaims against
Plaintiff remain pending and should proceed to discovery.
(Docket No. 32, 33.)
For the following reasons, the Court will grant Plaintiff’s
motion to dismiss his complaint, but the Court will deny without
prejudice Plaintiff’s counsel’s motion to withdraw, as well as
Slack’s motion for sanctions.
1.

Plaintiff’s motion to dismiss

In his motion to dismiss his claims with prejudice,
Plaintiff asserts that after he filed this action, Slack provided
him with a Declaration that claimed that the text messages were
purposely solicited from Plaintiff’s electronic devices.

“The

Plaintiff categorically denies the Defendant’s claims that the
Plaintiff is the one who purposely solicited these messages from
the Defendant.

However, if the Defendant was ‘set up’ by anyone

to make these calls, the Plaintiff desires no part in any claims
for recovery resulting from such calls.

As such, the Plaintiff

desires to withdraw his Complaint and his claims against
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Defendant with prejudice.

Plaintiff has offered to stipulate to

the dismissal of those claims; Defendant has refused to so
stipulate, instead insisting that the Plaintiff file the instant
Motion to Dismiss.”

(Docket No. 31-1 at 2.)

Federal Civil Procedure Rule 41(a) governs Plaintiff’s
motion.

Rule 41(a) provides in relevant part:

(1) Without a Court Order . . . [T]he plaintiff may dismiss
an action without a court order by filing: (i) a notice of
dismissal before the opposing party serves either an answer
or a motion for summary judgment; or (ii) a stipulation of
dismissal signed by all parties who have appeared. . . .
Unless the notice or stipulation states otherwise, the
dismissal is without prejudice.
(2) By Court Order; Effect. Except as provided in Rule
41(a)(1), an action may be dismissed at the plaintiff's
request only by court order, on terms that the court
considers proper. If a defendant has pleaded a counterclaim
before being served with the plaintiff's motion to dismiss,
the action may be dismissed over the defendant's objection
only if the counterclaim can remain pending for independent
adjudication.
Fed. R. Civ. P. 41(a).
Because Slack has not stipulated to the dismissal of
Plaintiff’s complaint, Rule 41(a)(2) applies.

Plaintiff requests

that his complaint be dismissed with prejudice, and Slack does
not oppose this request, except to note that it objects to the
dismissal of its counterclaims.
The Court will grant Plaintiff’s motion to dismiss his
complaint with prejudice.

Slack’s counterclaim will remain

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pending for separate adjudication. 3
2.

Plaintiff’s counsel’s motion to withdraw

Plaintiff’s counsel has moved to withdraw their
representation of Plaintiff.

Counsel relates:

As the Plaintiff’s Complaint is being withdrawn, there is
nothing left for Plaintiff’s counsel to do in this matter.
The Plaintiff’s counsel was retained in this matter on a
contingency basis, based on an expected recovery on the
Plaintiff’s TCPA claims. However, the Plaintiff no longer
has any claims. The Plaintiff has declined to retain or pay
the undersigned counsel to defend him in connection with the
Counterclaims now being brought by the Defendant. As such,
good cause exists for Marcus & Zelman, LLC to withdraw as
counsel as their representation of the Plaintiff has now
come to a close. The Plaintiff has agreed to this request.
3

The basis for subject matter jurisdiction over Plaintiff’s
complaint, which asserted a violation of federal law, is 28
U.S.C. § 1331. Because those claims have been dismissed, the
Court must determine whether it may exercise subject matter
jurisdiction over Slack’s counterclaims. See Barefoot
Architect, Inc. v. Bunge, 632 F.3d 822, 836 (3d Cir. 2011)
(other citation omitted) (explaining that “[g]enerally speaking,
the dismissal of the complaint will not preclude adjudication of
a counterclaim over which the court has an independent basis of
jurisdiction”); id. (citing Fed. R. Civ. P. 13(a)) (further
explaining had the defendants filed first, they could have
invoked § 1332 to bring their state law claims in federal court
in the first instance, and the plaintiff could have filed its
causes of action as counterclaims, but as things actually
transpired, the defendants were forced to file their state law
claims as compulsory counterclaims since they arose out of the
same “transaction or occurrence” as the plaintiff’s complaint).
Slack’s counterclaims arise under state law and arise out of the
same transaction or occurrence as Plaintiff’s claims. See id.
at 836 n.9 (citations omitted) (explaining that to be deemed
part of the same “transaction or occurrence” for Rule 13(a)
purposes, a claim need only bear a logical relationship to the
subject matter of the complaint). It appears that subject
matter jurisdiction may continue under 28 U.S.C. § 1332(a)
because Plaintiff is a citizen of New Jersey and Slack is a
citizen of California. (Docket No. 1 at 3, Docket No. 6 at 11.)
6

(Docket No. 30-1 at 2.)
The standards for assessing whether an attorney may be
relieved of his representation of his client in a pending case
are set forth in Local Civil Rule 102.1 and Rules of Professional
Conduct 1.16.

Local Civil rule 102.1 provides, “Unless other

counsel is substituted, no attorney may withdraw an appearance
except by leave of Court.”

Because no other counsel has been

substituted on Plaintiff’s behalf, Plaintiff’s counsel may only
withdraw by leave of Court.
To assist the Court in that assessment, RPC 1.16, “Declining
or Terminating Representation,” provides that the Court should
consider four criteria: 1) the reason withdrawal is sought; 2)
the prejudice withdrawal may cause to other litigants; 3) the
harm withdrawal may cause to the administration of justice; and
4) the degree to which withdrawal may delay the resolution of the
case.

U.S. ex rel. Cherry Hill Convalescent, Ctr., Inc. v.

Healthcare Rehab Sys., Inc., 994 F. Supp. 244, 252–53 (D.N.J.
1997).
Counsel relates that Plaintiff has consented to their
withdrawal, and a copy of their motion to withdraw was emailed
and mailed to Plaintiff.

(Docket No. 30-2.)

has not heard directly from Plaintiff.

The Court, however,

The Court does not know

whether Plaintiff understands that Slack’s counterclaims remain
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pending against him, or that Slack’s motion for sanctions against
him is not mooted by the dismissal of his complaint against
Slack.

The Court also does not know whether Plaintiff intends to

represent himself pro se or obtain new counsel.
The Court will therefore deny counsel’s motion without
prejudice at this time.

The Court will direct Plaintiff to file

a letter on the docket, either through his current counsel or
independently, indicating whether: (1) he consents to the
withdraw of his lawyers; (2) he understands that he is still
subject to Slack’s counterclaims and request for sanctions
against him; 4 and (3) he wishes to represent himself pro se or
obtain another attorney to represent him.

Counsel shall provide

a copy of this Opinion and accompanying Order to Plaintiff and
file a certification of service to document that they have done
so.

Counsel may refile their motion to withdraw as counsel, if

they choose, after Plaintiff has complied with the Court’s order.
The Court expresses no opinion on the merits of such a motion.
3.

Slack’s motion for sanctions

Slack argues that Plaintiff must be sanctioned for his
fraudulent denials set forth in the answer to Slack’s

4

Even though, as discussed below, the Court will deny without
prejudice Slack’s motion for sanctions, that denial is without
prejudice to Slack’s right to refile its motion pending the
resolution of its counterclaims against Plaintiff.
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counterclaims.

Slack contends that the unrebutted, detailed,

forensic evidence proves that Plaintiff sent the text messages to
himself in an attempt to fabricate TCPA claims, while in the
midst of litigating multiple other TCPA actions in this district.
Slack further contends that Plaintiff’s counsel must be
sanctioned for filing the baseless denials without adequate
inquiry in the answer to Slack’s counterclaims.

Slack points out

that the TCPA provides four years to bring a civil action, and
Plaintiff’s claims would not be time-barred until, at the
earliest, May 2, 2021.

Slack argues that Plaintiff’s counsel had

years to determine if there was any basis for this action, but
they did not, thus failing in their duty to perform a reasonable
investigation before brining suit.
Plaintiff’s counsel objects to Slack’s arguments.

Counsel

relates that on July 26, 2018, the parties participated in a Rule
16 initial conference before the Magistrate Judge, and at that
conference, Slack’s counsel advised the Magistrate Judge that it
wished to take a forensic examination of Plaintiff’s electronic
devices to back up its claims that Plaintiff used these devices
to repeatedly send himself text messages using Slack’s messaging
platform.

The Magistrate Judge then ordered the parties to

confer as to a forensic examination protocol.

The parties

submitted a stipulation agreeing to the protocol which was then
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so-ordered by the magistrate judge on August 13, 2018.

The Court

then ordered that Slack was to conduct the forensic examination
of Plaintiff’s computers and cell phones by no later than
September 10, 2018.

To date, however, counsel states that Slack

has not taken a forensic examination of Plaintiff’s electronic
devices.
Plaintiff’s counsel argues that Slack’s motion for sanctions
must be denied because it lacks any proof that Plaintiff actually
did what Slack says he did.

Counsel argues that Slack is seeking

sanctions against counsel and Plaintiff for filing an answer that
has not been found to be false or frivolous.

Counsel contends

that Slack could have obtained the forensic examination it
demanded, but instead when Plaintiff filed a denial to the
counterclaims, Slack tried to bully Plaintiff into withdrawing
his response by threatening him and his counsel with sanctions.
Federal Rule of Civil Procedure 11(b) provides:
By presenting to the court a pleading, written motion, or
other paper - whether by signing, filing, submitting, or
later advocating it - an attorney or unrepresented party
certifies that to the best of the person's knowledge,
information, and belief, formed after an inquiry reasonable
under the circumstances:
(1) it is not being presented for any improper purpose,
such as to harass, cause unnecessary delay, or needlessly
increase the cost of litigation;
(2) the claims, defenses, and other legal contentions are
warranted by existing law or by a nonfrivolous argument for
extending, modifying, or reversing existing law or for
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establishing new law;
(3) the factual contentions have evidentiary support or, if
specifically so identified, will likely have evidentiary
support after a reasonable opportunity for further
investigation or discovery; and
(4) the denials of factual contentions are warranted on the
evidence or, if specifically so identified, are reasonably
based on belief or a lack of information.
Fed. R. Civ. P. 11(b).
Rule 11(c) further provides that if “the court determines
that Rule 11(b) has been violated, the court may impose an
appropriate sanction on any . . . party that violated the rule
or is responsible for the violation.”
Rule 11 is intended to discourage the filing of frivolous,
unsupported, or unreasonable claims by “impos[ing] on counsel a
duty to look before leaping and may be seen as a litigation
version of the familiar railroad crossing admonition to ‘stop,
look, and listen.’”

Lieb v. Topstone Indus. Inc., 788 F.2d 151,

157 (3d Cir. 1986).

Specifically, Rule 11 requires that an

attorney certify that any pleading, written motion or other
paper presented to the court (1) is not presented for any
improper purpose such as to harass or increase the costs of
litigation, and (2) the legal contentions contained “are
warranted by existing law or by a non-frivolous argument for the
extension, modification, or reversal of existing law.”
Civ. P. 11(b)(1), (2).

Fed. R.

Rule 11 sanctions are “aimed at curbing
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abuses of the judicial system,” Cooter & Gell v. Hartmax Corp.,
496 U.S. 384, 397 (1990), and “intended to discourage the filing
of frivolous, unsupported, or unreasonable claims,” Leuallen v.
Borough of Paulsboro, 180 F. Supp. 2d 615, 618 (D.N.J. 2002).
Rule 11 sanctions are warranted only in the exceptional
circumstances where a claim or motion is patently unmeritorious
or frivolous.

Paris v. Pennsauken School Dist., 2013 WL

4047638, at *6 (D.N.J. 2013) (citing Watson v. City of Salem,
934 F. Supp. 643, 662 (D.N.J. 1995); Doering v. Union Cnty. Bd.
of Chosen Freeholders, 857 F.2d 191, 194 (3d Cir. 1988)).

The

Third Circuit has recognized that sanctions should only be
imposed in those rare instances where the evident frivolousness
of a claim or motion amounts to an “abuse[ ] of the legal
system.”

Id.

Moreover, a court must look to whether an

attorney's or party's representations to the court were
reasonable under the circumstances.

Pettway v. City of

Vineland, 2015 WL 2344626, at *7 (D.N.J. 2015) (citing Bus.
Guides v. Chromatic Commc'ns Ent., 498 U.S. 533, 551 (1991)).
“The wisdom of hindsight is to be avoided; the attorney's
conduct must be judged by what was reasonable to believe at the
time the pleading, motion, or other paper was submitted.”

Id.

(quoting Schering Corp. v. Vitarine Pharm., Inc., 889 F.2d 490,
496 (3d Cir. 1989)).

“When the attorney reasonably relies upon
12

the misrepresentations of a client, the client not the attorney
should be sanctioned under Rule 11.”

Id. (quoting Horizon

Unlimited, Inc. v. Richard Silva & SNA, Inc., No. CIV. A. 97–
7430, 1999 WL 675469, at *4 (E.D. Pa. Aug. 31, 1999)).

“Counsel

is permitted to assume his client is honest with him unless and
until circumstantial evidence is obviously to the contrary.”
Id.
In support of its motion for sanctions, Slack takes the
position that its proof as to Plaintiff’s conduct – and the
conduct of Plaintiff’s counsel - is unrebutted and unrebuttable.
The Court cannot credit Slack’s position at this stage in the
case.
Slack has asserted counterclaims against Plaintiff alleging
that Plaintiff fraudulently manufactured his TCPA claim by
sending thousands of text messages to himself.

Plaintiff has

filed an answer to Slack’s counterclaims denying that
allegation.

Slack’s claims are pending, still in dispute, and

they will proceed to discovery.

Slack may view Plaintiff’s

denials to be disingenuous and unsupported by the facts, but the
procedural posture of the case precludes the Court from applying
what is essentially a summary judgment standard to Slack’s
motion for sanctions, which, if Slack’s position were credited,
would ultimately result in a judgment in Slack’s favor prior to
13

discovery. 5
Consequently, the Court will deny without prejudice Slack’s
motion for sanctions, reserving Slack’s right to reassert its
motion at the appropriate time after discovery on its
counterclaims. 6
CONCLUSION
For the reasons expressed above, Plaintiff’s motion to
dismiss his complaint with prejudice will be granted.

5

Fed. R. Civ. P. 56(a) provides that the “court shall grant
summary judgment if the movant shows that there is no genuine
dispute as to any material fact and the movant is entitled to
judgment as a matter of law.” Currently, Plaintiff has disputed
Slack’s claims, and Plaintiff is entitled to present his
defense. The Court will not transform Slack’s Rule 11 motion
into one for summary judgment. However, nothing precludes Slack
from moving for summary judgment in accordance with the Federal
and Local Rules of Procedure. See Fed. R. Civ. P. 56(b)
(“Unless a different time is set by local rule or the court
orders otherwise, a party may file a motion for summary judgment
at any time until 30 days after the close of all discovery.”);
L. Civ. R. 56.1(a).
6

If Plaintiff’s current counsel is relieved, and Slack refiles
its motion for sanctions, such motion may still be advanced
against current counsel for their conduct while appearing on
Plaintiff’s behalf prior to their withdrawal. See 28 U.S.C. §
1927 (“Any attorney or other person admitted to conduct cases in
any court of the United States or any Territory thereof who so
multiplies the proceedings in any case unreasonably and
vexatiously may be required by the court to satisfy personally
the excess costs, expenses, and attorney's fees reasonably
incurred because of such conduct.”); Kramer v. Tribe, 156 F.R.D.
96, 101 (D.N.J. 1994) (citing Chambers v. Nasco, Inc., 501 U.S.
32, 43–46 (1991)) (“The Court also has inherent disciplinary
authority to supervise and monitor the conduct of attorneys
admitted to practice.”).
14

Plaintiff’s counsel’s motion to withdraw as counsel will be
denied without prejudice pending Plaintiff’s submission to the
Court.

Slack’s motion for sanctions will be denied without

prejudice.
An appropriate Order will be entered.

Date: April 15, 2019
At Camden, New Jersey

s/ Noel L. Hillman
NOEL L. HILLMAN, U.S.D.J.

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