D&D ASSOCIATES, INC., et al v. BOARD OF EDUCATION, et al
Filing
548
MEMORANDUM OPINION filed. Signed by Judge Mary L. Cooper on 4/29/2016. (mmh)
NOT FOR PUBLICATION
UNITED STATES DISTRICT COURT
DISTRICT OF NEW JERSEY
D&D ASSOCIATES, INC.,
Plaintiff,
v.
BOARD OF EDUCATION OF
NORTH PLAINFIELD, et al.,
Defendants.
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CIVIL ACTION NO. 03-1026 (MLC)
MEMORANDUM OPINION
THE COURT having granted in part the motion filed by defendant, the Board of
Education of North Plainfield (“the Board”) for attorneys’ fees, costs, and sanctions (“the
Board’s Motion”);1 and
The Court will cite to the documents filed on the Electronic Case Filing System (“ECF”) by
referring to docket entry numbers by the designation of “dkt.” Pincites reference ECF
pagination.
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The Court, by way of order dated December 10, 2015 (“12-10-15 Order”), granted the Board’s
Motion to the extent that it sought:
(1) attorneys’ fees on Count Five (“Civil Rights – Intimidation of Witnesses
(Epstein, Board of Education)”) accrued after March 26, 2007, under 42
U.S.C. § 1988 (“Section 1988”), to be paid by D&D itself;
(2) attorneys’ fees on Count Six (“Civil Rights – Illegal Garnishment Without
Due Process of Law (All Defendants)”) accrued after April 14, 2006, under
Section 1988, to be paid by D&D itself;
(3) sanctions against counsel for D&D on Count Five for the period after March
26, 2007, under Fed.R.Civ.P. 11 (“Rule 11”);
IT APPEARING that the Board requested “a determination as to liability … and
would seek to quantify the relief in subsequent proceedings” (dkt. 530 at 3); and it
appearing that the Board bears the burden of demonstrating “that specific fees incurred
were related to claims held to be frivolous,” Aksanov v. Harrah’s Casino Hotel Atl. City,
No. 10-5883, 2016 WL 386039, at *2 (D.N.J. Feb. 1, 2016); and it appearing that the
mere difficulty in allocating fees between successful and unsuccessful claims does not
relieve a party from its burden of demonstrating its entitlement to fees, see Emmanouil v.
Roggio, 499 Fed.Appx. 195, 203 (3d Cir. 2012); and it appearing that the Board applied
for “an Order Awarding Sanctions … and for such other and further relief as the Court
deems just and proper[,]” without stating that the Board sought to hold J. Charles Sheak,
(4) sanctions against counsel for D&D on Count Six for the period after April 14,
2006, under Rule 11;
(5) sanctions against D&D and its counsel on Count Seven (“Quia Timet – New
Jersey Law (All Defendants)”), Count Ten (“Tortious Interference (All
Defendants)”), Count Twelve (“Conversion (Board of Education, Bovis)”),
Count Thirteen (“Fraudulent Inducement (Board of Education, Epstein,
Vitetta)”), Count Fourteen (“Fraudulent Inducement, Rescission of
Performance Bonds (Board of Education, Epstein, Vitetta)”), Count Fifteen
(“Civil Conspiracy (Board of Education, Epstein, Vitetta, Bovis)”), and Count
Sixteen (“Malicious Abuse of Process (Board of Education, Epstein)”) under
Rule 11;
(6) attorneys’ fees against counsel for D&D under 28 U.S.C. § 1927 (“Section
1927”); [and]
(7) sanctions against D&D under the inherent powers of the Court[.]
(Dkt. 531 at 1–2.)
A 109-page Memorandum Opinion (“12-10-15 Memorandum Opinion”) accompanied
the 12-10-15 Order. (Dkt. 530.)
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Timothy Korzun, and Deborah Hollander personally liable in this action (dkt. 499 at 1);
and
THE BOARD now moving for clarification regarding the 12-10-15 Order (dkt.
533);2 and
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The Board asks the Court “to rule as follows:”
1. The attorneys’ fees awarded to the Board under 28 U.S.C. §1988 and Fed. R.
Civ. Pro. 11 will not be allocated between frivolous and non-frivolous claims,
and plaintiff D&D Associates, Inc. (“D&D”) and its counsel shall be liable for
all fees reasonably incurred by the Board to defend against all counts of the
complaint within the time frames referenced in the Decision;
2. Alternatively, D&D and its counsel shall bear the burden[] to prove by a
preponderance of the evidence (i) that the fees claimed by the Board should be
allocated, and (ii) how they should be apportioned;
3. The “sanctions” awarded by the Court in the Decision consist of the Board’s
reasonable attorneys’ fees, in a sum to be determined;
4. Under 28 U.S.C. §1927 and Fed. R. Civ. Pro. 11, the award of attorneys’ fees
and sanctions against “counsel for D&D” is jointly and severally against (a)
the Sheak & Korzun law firm, (b) Charles Sheak, (c) Timothy Korzun, and (d)
Deborah Holl[a]nd[e]r;
5. The award of attorneys’ fees against counsel for D&D under 28 U.S.C. §1927
and the award of sanctions against D&D under the Court’s inherent powers
encompass all of the reasonable attorneys’ fees incurred by the Board in this
litigation;
6. Awarding the Board all costs incurred in this litigation to the extent authorized
by Fed.R.Civ.P. 54(d)(l), jointly and severally against (a) the Sheak & Korzun
law firm, (b) Charles Sheak, (c) Timothy Korzun, and (d) Deborah
Holl[a]nd[e]r; and
7. For such other and further relief as the Court shall deem just and proper.
(Dkt. 533 at 2.)
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OPPOSING COUNSEL, representing Sheak & Korzun, P.C., replying that the
Board improperly seeks to: (1) “remove the requirement for the Board to prove and
allocate its fees and costs”; (2) “hold D&D’s counsel liable for all fees incurred from the
inception of the litigation despite the Court’s imposition of relief only as to particular
claims and time periods”; and (3) “hold each of J. Charles Sheak, Timothy Korzun, and
Deborah Hollander personally liable without any prior notice in the Board’s sanctions
motion that it was asserting personal liability against each of the individual attorneys it
now identifies and without any delineation of the specific vexatious or improper conduct
of each” (dkt. 540 at 5; see also dkt. 539 at 2); and
THE COURT having carefully reviewed the parties’ arguments and considering
the matter without oral argument pursuant to Local Civil Rule 78.1(b); and the Court
rejecting the Board’s argument that clarification of the 12-10-15 Order is warranted at
this time, except as set forth below, particularly because the Court previously stated that
it would determine the nature of attorneys’ fees, sanctions, and costs in subsequent
proceedings (dkt. 530 at 3, 85–86, 88); and
THE COURT concluding that the Board requests clarification on points that
exceed the scope of the 12-10-15 Memorandum Opinion and the Court must therefore
deny the motion for clarification regarding the 12-10-15 Order, except as follows:
Having reviewed the Board’s underlying Notice of Motion, Proposed Order, and
Supporting Brief on its motion to recover legal fees and costs (dkt. 499, dkt. 499-9, dkt.
499-1), the Court finds that none of those papers specified that such relief was sought
against individual members of the firm of Sheak & Korzun, P.C., counsel for plaintiff
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D&D Associates, Inc. The Court further observes that the Court’s Memorandum Opinion
and Order on that Motion (dkt. 530, dkt. 531) ruled regarding the liability of “counsel for
D&D,” meaning the law firm of Sheak & Korzun, P.C., counsel of record for plaintiff.
The Court hereby RULES, by way of CLARIFICATION, if necessary, that it has not
found individual liability for costs or fees to be assessed, or other sanctions to be
imposed, against individual members of that law firm.
The question of whether post-judgment collection proceedings on any financial
judgment to be entered against Sheak & Korzun, P.C. in this action may reach personal
assets of individual members of that law firm is beyond the scope of the current
proceedings to quantify the amount of costs and fees, and the nature of any other
sanctions, to be imposed upon that law firm. The Court expresses no view on that
question at this time.
s/ Mary L. Cooper
.
MARY L. COOPER
United States District Judge
Dated: April 29, 2016
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