Curtis & Associates, P.C. et al v. The Law Offices of David M. Bushman, Esq. et al

Filing 191

MEMORANDUM & ORDER. For the reasons set forth in the attached memorandum and order: (1) All defendants' motions to dismiss the federal RICO causes of action are granted and such claims are dismissed in their entirety and with prejudice. The co urt declines to exercise its supplemental jurisdiction over plaintiffs' state law claims which are dismissed without prejudice. (2) Plaintiffs' motion to amend or supplement the complaint is denied as futile. (3) Plaintiffs' separate motions to disqualify Levitt and Levy as counsel are both denied as moot. (4) The motion for sanctions by the Levitt defendants and defendant Turansky is denied, and the court further declines to sua sponte issue sanctions. The Clerk of the Court is respectfully requested to enter judgment in favor of defendants, to mail a copy of this memorandum and order to pro se defendant Nichols, and to close this case. Ordered by Judge Kiyo A. Matsumoto on 12/15/2010. (Ginns, Laura)

UNITED STATES DISTRICT COURT EASTERN DISTRICT OF NEW YORK ----------------------------------------X CURTIS & ASSOCIATES, P.C. and W. ROBERT CURTIS, Sc.D., J.D., Plaintiffs, - against THE LAW OFFICES OF DAVID M. BUSHMAN, ESQ.; DAVID M. BUSHMAN, ATTORNEY AT LAW; DAVID M. BUSHMAN, ESQ.; JANET TURANSKY CALLAGHAN; STEVI BROOKS NICHOLS; JEFFREY LEVITT, ESQ.; JEFFREY LEVITT, ATTORNEY AT LAW; HERBERT MONTE LEVY, ESQ.; LAW OFFICES OF HERBERT MONTE LEVY, ESQ.; JOHN DOE, ESQ.; LAW OFFICES OF JOHN DOE, ESQ.; JANE DOE, ESQ.; LAW OFFICES OF JANE DOE, ESQ.; and EILEEN DEGREGROIO, Defendants. ----------------------------------------X MATSUMOTO, UNITED STATES DISTRICT JUDGE: In a fifty-eight page, two hundred and sixty paragraph amended complaint attaching one hundred fifty-four pages of exhibits, Curtis & Associates, P.C. (the "Curtis Law Firm"), and W. Robert Curtis, Sc.D., J.D. ("Curtis"), (together, "plaintiffs"), bring seventeen causes of action against The Law Offices of David M. Bushman, Esq., David M. Bushman, Attorney at Law, and David M. Bushman, Esq. (collectively, the "Bushman defendants"); Jeffrey Levitt, Esq. and Jeffrey Levitt, Attorney at Law, (collectively, the "Levitt defendants"); Herbert Monte Levy, Esq. and Law Offices of Herbert Monte Levy, Esq. (collectively, the "Levy defendants"); Eileen DeGregorio MEMORANDUM & ORDER 09-CV-890 (KAM) (RER)

("DeGregorio"), Janet Turansky Callaghan ("Turansky"); and Stevi Brooks Nichols ("Nichols");1 (together "defendants"). Plaintiffs

seek recovery under the Racketeer Influenced and Corrupt Organizations ("RICO") statute, 18 U.S.C. § 1961 et seq., for economic damages allegedly caused to their business and property (the "federal claims"), as well as damages under various New York statutory and common law causes of action (the "state law claims"). (See ECF No. 2, Amended Verified Complaint Pursuant to 28 U.S.C. § 1331(a),

("Complaint" or "Compl.").)

federal question jurisdiction is predicated solely on the first ten causes of action which arise under the federal RICO statute. (Id. ¶ 4.)2 The Bushman defendants, the Levitt defendants, the Levy defendants, DeGregorio, Turansky, and Nichols each move separately to dismiss the amended complaint on a variety of grounds, including for failure to state a claim upon which relief can be granted pursuant to Federal Rule of Civil Procedure 12(b)(6) ("Rule 12(b)(6)"), and plaintiffs oppose.
1

The Complaint refers to "Janet Turansky Callaghan" as "Callaghan" (compl. ¶ 12), and defendant "Stevi Brooks Nichols" as "Brooks." However, in their own moving papers these defendants refer to themselves as "Turansky" and "Nichols," respectively, and accordingly this memorandum and order does the same. The original complaint (ECF No. 1,) Amended Complaint (ECF No. 2), and the Proposed Second Amended Complaint (ECF No. 174-1) each apparently omit a digit by citing to "28 U.S.C. § 133(a)" as the basis for the court's jurisdiction. (See ECF No. 1 at ¶ 4, ECF No. 2 at ¶ 4, ECF No. 174-1 at ¶ 4.) Because plaintiffs do not plead diversity jurisdiction, the court interprets plaintiffs' Complaint as alleging federal question jurisdiction pursuant to 28 U.S.C. § 1331(a).

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Additionally, after defendants' various motions to dismiss had been fully briefed and were pending before the court, plaintiffs sought and received permission from the court to move to amend/correct/supplement the complaint, plaintiffs so moved, and defendants all opposed. Plaintiffs also move to disqualify

Herbert Monte Levy, Esq. ("Levy") as counsel for defendant DeGregorio, and Jeffrey Levitt, Esq. ("Levitt") as counsel for defendant Turansky, and Levy and Levitt oppose. Finally,

defendants Levitt and Turansky move for sanctions against plaintiffs pursuant to Federal Rule of Civil Procedure 11 ("Rule 11"). For the reasons that follow, the motions to dismiss are granted in their entirety as to the federal RICO causes of action and the court declines to exercise supplemental jurisdiction with respect to the state law causes of action. The motion to amend or supplement the complaint is denied as futile, the motions to disqualify Levitt and Levy as counsel are denied as moot, and the motion for sanctions is denied.

BACKGROUND A court considering a motion to dismiss pursuant to Rule 12(b)(6) must accept all well-pleaded factual allegations of a complaint as true, but need not give any effect to legal conclusions couched as factual allegations. 3 Starr v. Sony BMG

Music Entm't, 592 F.3d 314, 321 (2d Cir. 2010).

The factual

allegations3 of the Complaint and the incorporated documents4 are as follows. A. The Parties Plaintiff Curtis is an attorney licensed in the State of New York and the principal of the Curtis Law Firm, a New York professional corporation with an office in Manhattan.5 7-8.) (Compl. ¶

Since 1987, plaintiffs allege that the Curtis Law Firm

and its predecessor firm have been "the only law firm[s] in the
3

The Complaint is replete with conclusory assertions. (see, e.g., Compl. ¶¶ 70-71 ("DeGregorio shaped her testimony to the false claims drafted by Bushman in the phony malpractice case, startling the Court at times with her Big Lies. For example, DeGregorio . . . testified falsely that she believed the Curtis Firm had `stolen' her equitable distribution (a Big Lie).").) The court declines to undertake the unnecessary task of parsing out each conclusory assertion scattered throughout the Complaint. Rather, the court has considered plaintiffs' factual allegations and where pertinent to the court's analysis has noted throughout this memorandum and order its disregard of specific conclusory allegations which are not entitled to the presumption of truth. See, e.g., Starr, 592 F.3d at 321. In accordance with the well-settled law of this Circuit, in deciding a Rule 12(b)(6) motion to dismiss, the court will consider, along with the Complaint, those documents submitted by the parties which are matters of public record or which are deemed included in the Complaint. See Pani, M.D. v. Empire Blue Cross Blue Shield, 152 F.3d 67, 75 (2d Cir. 1998) (noting that it is "well-established" that a court may rely on matters of public record in deciding a Rule 12(b)(6) motion to dismiss). The court declines to decide here the propriety of plaintiffs' unconventional "Rule 8(a)(2) Declaration." (See ECF No. ECF No. 97, Plaintiffs' Rule 8(a)(2) Declaration in Opposition to Defendants' Motions to Dismiss.) While unaware of any Federal Rule requiring such a declaration, the court notes that the attached documents consist of court documents which are properly considered in deciding a Rule 12(b)(6) motion as matters of public record. See Pani, 152 F.3d at 75; see also Blue Tree Hotels Inv., Ltd. v. Starwood Hotels & Resorts Worldwide, Inc., 369 F.3d 212, 217 (2d Cir. 2004) (courts "may also look to public records, including complaints filed in state court, in deciding a motion to dismiss").
5 4

The Complaint interchangeably refers to Curtis and the Curtis Law Firm. (Compare, e.g., Compl. ¶ 89 (alleging Turansky's retention of the "Curtis Law Firm") and id. ¶ 93 (alleging Turansky's subsequent further retention of "Curtis").) Accordingly, and because the distinction is immaterial to the court's analysis, the court also interchangeably references these parties.

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United States" to concentrate their practice on "representing clients injured by attorneys." (Id. ¶ 7.)

DeGregorio, Turansky, and Nichols are each former clients of the Curtis Law Firm. (Id. ¶¶ 12-14.) Bushman,

Levitt, and Levy, are attorneys licensed to practice in the State of New York. (Id. ¶¶ 11, 15, 16.) Bushman practices law

in Nanuet, New York through entities named the Law Offices of David M. Bushman, Esq. and David M. Bushman, Attorney At Law (id. ¶¶ 9-10), Levitt practices law in Amityville, New York through an entity named Levitt Attorney at Law (id. ¶15), and Levy practices law in Manhattan through an entity named Law Offices of Herbert Monte Levy (id. ¶ 16).6 At various times, the

Bushman defendants, the Levy defendants, and the Levitt defendants have each allegedly represented or counseled plaintiffs' former clients DeGregorio, Turansky, and Nichols in those clients' respective litigation against plaintiffs in New York State Court in Westchester County. 51, 62, 104, 120, 124, 128.) Tracing the evolution of DeGregorio, Turansky, and Nichols from Curtis Law Firm client to adversary, the Complaint (See, e.g., id. ¶¶ 49-

The Complaint similarly interchangeably references Bushman, Levitt, and Levy, with the legal entities through which Bushman, Levitt, and Levy respectively practice law. (See, e.g., Compl. ¶ 120 (alleging Levitt's personal representation of Turansky as a result of the substitution of Levitt Attorney at Law as Turansky's counsel.) Because of this, and because the differences are immaterial to the court's analysis, this memorandum and order also interchangeably refers to these individual and entity defendants.

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organizes its allegations under headings "The Corruption of Defendant DeGregorio," "The Corruption of Defendant [Turansky]," and "The Corruption of Stevi Brooks Nichols." follows that organization. B. The "Corruption" of Defendant DeGregorio In December 2001, DeGregorio retained the Curtis Law Firm on an hourly fee basis to prosecute legal malpractice claims against her former divorce attorneys ("matrimonial malpractice claims"). (Compl. ¶ 43.) The Curtis Law Firm also This discussion

appeared on DeGregorio's behalf in her ongoing matrimonial case. (Id. ¶ 45.) Despite a few early victories by the Curtis Law

Firm, ultimately all of DeGregorio's matrimonial malpractice claims were dismissed on appeal. (Id. ¶¶ 46-47.)

At the time of this dismissal, DeGregorio had an outstanding legal bill with the Curtis Law Firm for $120,000. (Id. ¶ 48.) The Curtis Law Firm offered to settle DeGregorio's

bill for $60,000 but DeGregorio rejected the settlement offer. (Id.) Instead, DeGregorio retained the Bushman Law Offices to

represent her on a contingent basis and filed a malpractice complaint "based on false allegations" against the Curtis Law Firm seeking disgorgement of all fees paid to the Curtis Law Firm exceeding $100,000. (Id. ¶¶ 49-51, 56.)

The Curtis Law Firm notified its insurance carrier of this malpractice claim. (Id. ¶ 52.) 6 In addition, the Curtis

Law Firm counterclaimed against DeGregorio for legal fees. ¶ 57.)

(Id.

The Curtis Law Firm also made a separate motion for a

quantum meruit hearing to "determine the fair and reasonable value of the legal services rendered to" DeGregorio by the Curtis Law Firm while litigating the matrimonial malpractice claims. (Id. ¶ 66); see also DeGregorio v. Bender, 52 A.D.3d

645, 646 (N.Y. App. Div. 2d Dep't 2008) (describing history of fee dispute in DeGregorio's matrimonial malpractice action). Following that hearing, the state court awarded the Curtis Law Firm legal fees in the sum of $94,017.70. 646. Bender, 52 A.D.3d at

On appeal, however, the Second Department reversed,

finding that the hearing court had "failed to consider and give appropriate weight to all the relevant factors involved in valuing legal services, including the court's own finding of ethical violations committed by Curtis." Id.

In the course of prosecuting DeGregorio's "phony" malpractice claim against the Curtis Law Firm and defending against the Curtis Law Firm's fee claims, the Bushman Law Offices, Bushman Attorney at Law, and DeGregorio engaged in various "litigation activities." (Compl. ¶¶ 58, 60.) According

to the complaint, these "litigation activities," constitute mail fraud. (Compl. ¶¶ 58, 60.) Specifically, in order to advance

the "scheme to litigate" DeGregorio's alleged "fee obligation" to the Curtis Law Firm, the Bushman defendants allegedly 7

committed mail fraud by mailing to the court, other parties, witnesses, or counsel: (1) a Reply to the Counterclaims asserted by the Curtis Law Firm on February 9, 2007; (2) a Notice for Discovery on February 9, 2007; (3) a Cross-Notice to Take Deposition on February 9, 2007; (4) a Verified Bill of Particulars on February 22, 2007; (5) a letter regarding a subpoena served on a witness on June 14, 2007; (6) an Affirmation in Opposition to the Curtis Law Firm's Motion to Disqualify Bushman on March 17, 2007; (7) an Affirmation in Opposition to a Cross-Motion dated March 28, 2005; (8) a cover letter for Respondent's Post-Trial Brief dated September 15, 2006; (9) a cover letter transmitting Respondent's Proposed Counter-Judgment and Affirmation in Support dated October 13, 2006; (10) a letter to the court requesting a 90-day extension of time dated October 21, 2005; (11) a letter regarding service by fax dated November 9, 2006; and (12) a letter regarding DeGregorio's ability to satisfy any potential judgment dated December 29, 2006.7 78(A)-(C), Ex. 7.) (Id. ¶¶ 58(A)-(E)-60(A), 68(A), 72(A)-(B),

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The court disregards plaintiffs' conclusory allegation that the litigation activities listed as items (10)-(12) above, namely, the 10/21/05 request for an adjournment, the 11/9/06 letter regarding service by fax, and the 12/29/06 letter regarding DeGregorio's ability to satisfy a potential judgment, were mailed "to assist in the sale of [DeGregorio's] Westhampton property with the intent to delay, hinder, and defraud" the Curtis Law Firm. (Compl. ¶ 78(A)-(C).) Such conclusory allegations are not entitled to the presumption of truth. See, e.g., Starr, 592 F.3d at 321.

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After the Curtis Law Firm successfully moved to disqualify Bushman in DeGregorio's malpractice action against the Curtis Law Firm, the Levy Law Offices was substituted as DeGregorio's counsel. (Id. ¶¶ 59, 61-62.) The Levy Law Offices

then negotiated a settlement of DeGregorio's malpractice action against Curtis. (Id. ¶ 62.) The complaint alleges that by

engaging in "litigation activity" to "advance the fee dispute with the Curtis Law Firm," the Levy defendants and DeGregorio also committed mail fraud. (Id. 81, 88.) Specifically, the

complaint alleges that the Levy defendants and DeGregorio engaged in mail fraud by mailing the following documents to the court, other parties, or counsel: (1) a letter to adjourn a motion filing deadline dated January 10, 2008; (2) sworn statements by DeGregorio opposing a fee hearing and the disqualification of Bushman as her attorney dated November 2, 2004 and March 26, 2005, respectively; (3) a letter to the court submitting a replacement Appellant's brief on May 31, 2007; (4) a handwritten note to the Appellate Division "misrepresenting" an agreement between the parties regarding the contents of the record dated July 26, 2007; (5) a letter to the Appellate Division regarding adjourning deadlines dated September 11, 2007; (6) a Notice of Settlement dated July 7, 2008; (7) a Notice of Entry by the Levy Law Office dated August 5, 2008; (8) an Answering Affirmation of Levy dated October 14, 2008; and (9) 9

an Order to Show Cause with Affirmation of Levy dated October 2, 2008. (Id. ¶¶ 64(A), 69, 81(A)-(C), 88(A)-(D).) The complaint

further alleges that this mail fraud by the Levy defendants and DeGregorio is "ongoing" because the fee dispute between the Curtis Law Firm and DeGregorio has not yet been resolved and is "on the eve of trial."8 (Id. ¶ 88(E).)

C. The "Corruption" of Defendant Turansky Turansky retained the Curtis Law Firm in June of 2002 to represent her in her divorce case. (Id. ¶ 89.) Turansky

then retained the Curtis Law Firm to represent her in a quantum meruit hearing demanded by one of her former divorce attorneys to address his $28,000 retaining and charging lien. 93.) (Id. ¶¶ 90-

The twenty-eight day quantum meruit hearing was terminated

by the court's issuance of a directed verdict in Turansky's favor on February 7, 2004. (Id. ¶¶ 97, 102.) Turansky then

authorized the Curtis Law Firm to represent her in opposing the appeal of that directed verdict. (Id. ¶¶ 98-99.)

During the course of the earlier quantum meruit hearing, Turansky stopped paying her legal fees to the Curtis Law Firm, which then totaled $282,829.52. (Id. ¶ 96.) On

November 29, 2004, on the same day that the Curtis Law Firm completed oral argument at the Second Department regarding the
8

Plaintiffs' proposed Second Amended Complaint alleges that a recent decision by the state court judge in connection with the fee dispute is under appeal. (See ECF No. 174-1, Plaintiffs' Proposed Amended Complaint ("Proposed Second Am. Compl.") ¶ 88(G).)

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appeal from the directed verdict, Turansky terminated the Curtis Law Firm "for cause." (Id. ¶ 101.) Turansky terminated the

Curtis Law Firm allegedly after conferring with Bushman, who advised her that she could avoid paying the Curtis Law Firm's legal fees if she made the termination "for cause" and sued the Curtis Law Firm for malpractice. (Id. ¶ 102-103.) Bushman also

allegedly offered to represent Turansky for a "nominal fee" to defend any fee claims against her by the Curtis Law Firm and on a contingent basis to prosecute a malpractice action against the Curtis Law Firm. (Id.)

Turansky retained Bushman and filed a legal malpractice complaint containing "knowingly false allegations" against the Curtis Law Firm in December 2004. 106.) (Id. ¶¶ 104,

The Curtis Law Firm notified its carrier of this (Id. ¶¶ 105,

malpractice action and counterclaimed for fees. 115.)

By prosecuting Turansky's legal malpractice action against the Curtis Law Firm and defending Turansky against the Curtis Law Firm's fee claims, Bushman engaged in certain "litigation activities" which plaintiffs allege constitute mail fraud. (Id. ¶ 113.) Specifically, the Complaint alleges that

Bushman committed mail fraud by mailing to the court, parties, or counsel: (1) an Affirmation in Opposition to Motion to Dismiss dated February 17, 2005; (2) an Affirmation in 11

Opposition to Motion to Dismiss dated March 24, 2005; (3) a Verified Bill of Particulars dated July 26, 2005; (4) a Supplemental Verified Bill of Particulars dated October 4, 2005; (5) an Affirmation in Opposition to Motion for Summary Judgment dated February 7, 2006; (6) an Affirmation in Opposition to total Disqualification dated February 13, 2006; and (7) a Motion to Dismiss Third-Party Complaint dated August 7, 2006. 113.) (Id. ¶

Additionally, Turansky allegedly engaged in mail and wire (1) mailing a letter on February 26, 2007 to the

fraud by:

Court regarding her preference to have Bushman represent her in defending against plaintiffs' fees counterclaims; (2) making "repeated phone calls" from Connecticut to Bushman in New York during several days prior to February 26, 2007; (3) mailing "upon information and belief, numerous letters" to Bushman; (4) presenting a "completely false affidavit" within a Notice of Motion dated February 22, 2009 and mailed by Levitt; and (5) committing "numerous other" unspecified acts of mail and wire fraud. (Id. ¶¶ 113(H), 115(A)-(C), 124(E).) The Curtis Law Firm succeeded in obtaining summary judgment in Turansky's malpractice action against Curtis, but lost its fee action against Turansky when the judicial hearing officer determined that Turansky owed no fees to the Curtis Law Firm. (Id. ¶¶ 114, 116.) According to plaintiffs, the judicial

hearing officer's determination relied upon "false testimony" by 12

Turansky which tracked the "false claims" contained in Turansky's malpractice action against the Curtis Law Firm. ¶ 116.) (Id.

After the judicial hearing officer's determination, the

charging lien by the Curtis Law Firm on Turansky's equitable distribution was released by court order and Turansky allegedly invested the funds in a property in Connecticut.9 (Id. ¶ 117.)

Later, on appeal, the Second Department reversed and remanded the judicial hearing officer's determination for a new hearing on the Curtis Law Firm's fee claims against Turansky.10 119.) After Bushman was disqualified as Turansky's attorney, Bushman allegedly recruited Levitt to substitute as the attorney for Turansky at the Second Department and for the rehearing. (Id. ¶¶ 112, 120, 124.) Levitt, allegedly with the assistance (Id. ¶

of Bushman, also committed mail and wire fraud in the course of representing Turansky by mailing: (1) a Notice of Motion and request for jury trial dated June 14, 2008; and (2) an Omnibus Notice of Motion dated February 22, 2009 seeking to preclude or delay a deposition and containing both an Amended Reply to
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The court disregards plaintiffs' conclusory allegations that (i) Turansky's alleged investment in Connecticut property rendered her "judgment proof" because the Connecticut property is protected by a "generous Homestead Act," and (ii) that this investment was "part of a plan . . . to hinder, delay, and defraud" the Curtis Law Firm as a future creditor. See, e.g., Starr, 592 F.3d at 321. Plaintiffs' proposed Second Amended Complaint does not contain any allegations as to recent developments in these proceedings. (See generally Proposed Second Am. Compl.)
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Counterclaims and an affidavit by Turansky. E).)11

(Id. ¶ 124(A, C-

Finally, plaintiffs allege that because the litigation

regarding the fee dispute is ongoing, "this mail fraud and wire fraud [on the part of Bushman, Levitt, and Turansky] is ongoing." (Id. ¶ 124(F).)

D. The "Corruption" of Defendant Nichols Nichols became a client of the Curtis Law Firm on a contingency fee basis by a written agreement dated October 14, 1998. (Id. Ex. 20 at 1.) Nichols disputed $150,000 in fees (Id. ¶ 128.) On

allegedly earned by the Curtis Law Firm.

December 3, 2003, Nichols discharged the Curtis Law Firm allegedly for cause, and proceeding pro se, thereafter commenced a legal malpractice action against plaintiffs and others by a verified complaint dated January 9, 2009. ¶ 14, Ex. 20 at 3.) (Id. ¶ 125, Ex. 19 at

The Curtis Law Firm notified its (Id. ¶ 126.)

malpractice insurer of this new claim.

Plaintiffs allege that Nichols has committed mail and wire fraud by mailing her verified complaint from Colorado, where she resides, to the New York Courts, as well as by mailing and faxing letters dated February 6, 17, 23, and 24, 2009 to
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The court disregards the vague and conclusory allegations that during oral argument on January 26, 2009, "Levi [sic] made numerous confusing and misleading statements to the Court . . . Whatever!! Levitt is now under the control of Bushman and . . . has recently made up a new claim alleging that the Curtis Law Firm acted fraudulently [sic] [Turansky] retained it. This is another Big Lie." (Compl. ¶ 124(B).) It is unclear whether plaintiffs intend to allege that such oral statements constitute mail or wire fraud but, regardless, these conclusory allegations are not entitled to the presumption of truth. See, e.g., Starr, 592 F.3d at 321.

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various New York State judges and others. (F).)

(Id. ¶¶ 14, 130(A)-

Because Nichols is currently defending a motion to

dismiss her complaint, plaintiffs allege that this "mail and wire fraud is ongoing." (Id. ¶ 130(G).)

Moreover, plaintiffs allege that "[u]pon information and belief, Bushman has counseled and guided Nichols through her false and extreme accusations of wrong-doing" against the Curtis Law Firm. (Id. ¶ 127.) Plaintiffs conclusorily maintain that

the "contents" of the various letters and pleadings mailed and faxed by Nichols "disclose[] a participation and association [on the part of Nichols] with the Bushman Law Office in the fraudulent schemes devised by Bushman." (Id. ¶¶ 127, 130.)

E. The "Corruption" of Various Non-Parties Plaintiffs also allege that three other non-parties were "corrupted" by Bushman and stopped paying for legal fees owed to the Curtis Law Firm. (See id. ¶¶ 17-19.)

First, Fred Lorentzen ("Lorentzen"), a former Curtis Law Firm client who had signed an hourly retainer, stopped paying the Curtis Law Firm for his legal services in 1996 when he owed it $50,000. (Id. ¶ 20.) Bushman then commenced an

action on behalf of Lorentzen against Curtis and others ("Lorentzen action"). (Id. ¶ 22.) The Curtis Law Firm's

insurance carrier paid more than $300,000 in defense costs prior to the settlement of the Lorentzen action, purportedly for a 15

$25,000 payment to Lorentzen by Bushman's carrier. 27.)

(Id. ¶¶ 26-

Similarly, Katheryn Boone ("Boone") retained the Curtis Law Firm under an hourly retainer agreement to represent her in a malpractice action against her former matrimonial attorney. (Id. ¶¶ 30-31.) In 2004, Boone stopped paying the

Curtis Law Firm for legal services when she owed approximately $25,000 in fees. (Id. ¶ 31.) After the Curtis Law Firm was

granted leave to withdraw, Bushman became Boone's attorney and continues to represent her in her matrimonial action. 32.) (Id. ¶

According to plaintiffs, Bushman has "indicated" that if

the Curtis Law Firm seeks to collect the fees allegedly owed by Boone, Boone will counterclaim with a malpractice action against the Curtis Law Firm. (Id. ¶ 33.) The Curtis Law Firm has (Id.

notified its malpractice insurer of this potential claim. ¶ 34.)

Finally, Edward King ("King") retained the Curtis Law Firm in 1997 under an hourly retainer agreement to represent him in a malpractice action against his former entertainment attorney. (Id. ¶¶ 35-39.) King stopped paying the Curtis Law

Firm for legal services in 2005 when he owed it approximately $80,000 in fees. (Id. ¶ 39.) Bushman allegedly appeared

"informally" as a legal malpractice attorney on behalf of King at a quantum meruit hearing regarding King's allegedly owed 16

fees.

(Id. ¶ 40.)

During that hearing, Bushman "guided King

through articulating false claims of malpractice on the record" and "counsel[ed]" King on how to testify "untruthfully." 40.) (Id. ¶

The court ultimately reduced the amount of fees King owed

to the Curtis Law Firm but found that King had not terminated the Curtis Law Firm "for cause." (Id. ¶ 41, Ex. 3.) The Curtis

Law Firm notified its insurance carrier of a potential malpractice action involving King. (Id. ¶ 42.)

F. The Schemes to Defraud Plaintiffs Broadly, and as summarized in a section of the Complaint entitled "Summary of the Repeated Corruption of the Corruptible," plaintiffs allege that Bushman enlisted two other lawyers, co-defendants Levitt and Levy, and they together "corrupt[ed]" six or seven "corruptable" [sic] former Curtis

Law Firm clients to engage in "several fraudulent, interconnected schemes" to defraud plaintiffs. ¶¶ 141, 146.) (Id. at 33, id.

Allegedly in violation of RICO, defendants used

mail and wire transmittals to complete these schemes of: (i) disputing the Curtis' Law Firm's "right" to legal fees from its former clients based on "phony" malpractice claims; (ii) prosecuting "knowingly false legal malpractice claims [against the Curtis Law Firm] with suborned perjury and deceit of courts;" (iii) "providing legal advice [to clients] on how to protect and convey assets so that any judgment eventually 17

obtained by the Curtis Law Firm" would be uncollectible; and (iv) "delaying and hindering" the Curtis Law Firm, a "future creditor," from obtaining judgments against its former clients because of "frivolous litigation." (Id. ¶ 142.)

In simpler terms, plaintiffs allege that defendants, who are former Curtis Law Firm clients, together with their new counsel, have committed mail and wire fraud through "frivolous litigation" by defending against the fee claims initiated by plaintiffs themselves, and by counter-claiming or separately bringing "phony" malpractice claims against plaintiffs in the course of such defenses. (See id. ¶¶ 142-143.) Because

plaintiffs allege that they will ultimately prevail in the underlying state court fee claims, plaintiffs allege that they are "future creditors" of defendants who have been "delayed and hindered" by defendants' "frivolous litigation" and "fraudulent conveyance" of assets. (Id.)

Plaintiffs further allege that the "fraudulent and frivolous law suits" commenced and defended by the Bushman defendants and now continued by the Levitt and Levy defendants on behalf of the "corruptible" former clients of the Curtis Law Firm have created a claims history for the Curtis Law Firm which prevents it from obtaining malpractice insurance. 138.) (Id. ¶¶ 133-

Without malpractice insurance, plaintiffs allege that the

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Curtis Law Firm "was required to stop accepting new clients" and is currently "going out of business." (Id. ¶ 136.)

The Curtis Law Firm has been damaged by the lost income from the "earned fees" disputed by defendants, which has required it to go into debt in order to support the continued operations of its existing case load. (Id. ¶ 137.)

Additionally, the Curtis Law Firm has been damaged by the need to divert resources away from billable work and toward the nonbillable work of defending the fee disputes, malpractice claims, and fraudulent conveyances by the three former clients DeGregorio, Turansky, and Nichols, with the assistance of, variously, the Bushman defendants, Levitt defendants, and Levy defendants. (Id. ¶¶ 138-139.)

DISCUSSION I. Motions to Dismiss The Bushman defendants,12 the Levitt defendants,13 the Levy defendants,14 defendant DeGregorio,15 defendant Turansky,16 and

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The parties have submitted the following motion papers in connection with the Bushman defendants' motion to dismiss: ECF No. 84, Memorandum of Law in Support of the Bushman Defendants' Motion to Dismiss ("Bushman Mem."); ECF Nos. 83, 107, 109, and 111, Affidavit of Michael J. Cannon in Support of the Bushman Defendants' Motion to Dismiss ("Cannon Aff."); ECF No. 86, Plaintiffs' Memorandum of Law in Opposition to the Motion to Dismiss by the Bushman Defendants ("Pl. Bushman Mem."); ECF No. 87, Reply Memorandum of Law in Support of the Bushman Defendants' Motion to Dismiss ("Bushman Reply Mem."). The parties have submitted the following motion papers in connection with the Levitt defendants' motion to dismiss: ECF No. 75, Affidavit ("Levitt Aff. #1") and Memorandum of Law in Support of Jeffrey Levitt's Motion to

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defendant Nichols17 each move separately to dismiss the complaint on a variety of grounds, and plaintiffs oppose.18

Dismiss ("Levitt Mem."); ECF No. 77, Supplemental Memorandum in Support of Jeffrey Levitt's Motion to Dismiss ("Levitt Supp. Mem."); ECF No. 79, Plaintiffs' Memorandum of Law in Opposition to the Motion to Dismiss by Jeffrey Levitt ("Pl. Levitt Mem."); ECF No. 80, Reply Memorandum of Law in Support of Levitt Motion to Dismiss ("Levitt Reply Mem.").
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The parties have submitted the following motion papers in connection with the Levy defendants' motion to dismiss: ECF No. 89, Memorandum of Law in Support of Levy Defendants' Motion to Dismiss ("Levy Mem."); ECF No. 132, Affidavit in Support of the Levy Defendants' Motions to Dismiss ("Levy Aff. #1"); ECF No. 102, Plaintiffs' Memorandum of Law in Opposition to the Motion to Dismiss by Levy Defendants ("Pl. Levy Mem."); ECF No. 135, Reply Affidavit in Support of Levy and DeGregorio's Motions to Dismiss ("Levy Aff. #2"); ECF No. 103, Reply Memorandum of Law in Support of Levy Defendants' Motion to Dismiss ("Levy Reply Mem."). The parties have submitted the following motion papers in connection with DeGregorio's motion to dismiss: ECF No. 131, Affidavit in Support of Eileen DeGregorio's Motion to Dismiss ("DeGregorio Aff."); ECF No. 133, Memorandum of Law in Support of Eileen DeGregorio's Motion to Dismiss ("DeGregorio Mem."); ECF No. 138, Plaintiffs' Memorandum in Opposition to Motion to Dismiss by Eileen DeGregorio; ECF No. 136, Reply Memorandum in Support of Eileen DeGregorio's Motion to Dismiss ("DeGregorio Reply Mem."); ECF No. 135, Reply Affidavit in Support of Levy and DeGregorio's Motions to Dismiss ("Levy Aff. #2"). The parties have submitted the following motion papers in connection with Turansky's motion to dismiss: ECF No. 76, Affidavit ("Levitt Aff. #2") and Memorandum of Law in Support of Janet Turansky's Motion to Dismiss ("Turansky Mem."); ECF No. 78, Plaintiffs' Memorandum in Opposition to Motion to Dismiss by Janet Turansky Callaghan ("Pl. Turansky Mem."); ECF No. 81, Reply Memorandum in Support of Janet Turansky's Motion to Dismiss ("Turansky Reply Mem."). The parties have submitted the following motion papers in connection with Nichols' motion to dismiss: ECF No. 143-5, Memorandum of Law in Support of Stevi Brooks Nichols' Motion to Dismiss ("Nichols Mem."); ECF No. 143-4, 7, 8, 9, 10, 11, 12, Affidavit in Support of Motion to Dismiss ("Nichols Aff."); ECF No. 143-14, Plaintiffs' Memorandum in Opposition to Motion to Dismiss by Stevi Brooks Nichols ("Pl. Nichols Mem."); ECF No. 143-4, Reply Memorandum of Law in Further Support of Stevi Brooks Nichols' Motion to Dismiss ("Nichols Reply Mem."). Submissions relating to each group of defendants have been cited in turn. However, plaintiffs have additionally submitted the following motion papers in opposition to all defendants' motions to dismiss: ECF Nos. 88, 90, 92, 93, 94, 95, and 96, Declaration of W. Robert Curtis in Opposition to All Defendants' Motions to Dismiss ("Curtis Decl. #1"); ECF No. 97, Plaintiffs' Rule 8(a)(2) Declaration of Plaintiff W. Robert Curtis in Opposition to Defendants' Motions to Dismiss ("Curtis Decl. #2"); ECF Nos. 99 and 101, Supplemental Declaration of W. Robert Curtis in Opposition to Defendants' Motions to Dismiss ("Curtis Decl. #3").

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A. Legal Standard Rule 12(b)(6) provides for the dismissal of a complaint containing allegations which fail "to state a claim upon which relief can be granted." Fed. R. Civ. P. 12(b)(6).

Thus, in order "[t]o survive a motion to dismiss under [Rule 12(b)(6)], a complaint must contain sufficient factual matter, accepted as true, to `state a claim to relief that is plausible on its face.'" Ashcroft v. Iqbal, 129 S. Ct. 1937, 1949 (2009)

(quoting Bell Atl. Corp. v. Twombly, 550 U.S. 544, 570 (2007)). In assessing plausibility on a Rule 12(b)(6) motion to dismiss, a court must "assume [the] veracity" of all well-pleaded factual allegations contained in the complaint, Iqbal, 129 S. Ct. at 1950, and afford the plaintiff every reasonable inference, see Zinermon v. Burch, 494 U.S. 113, 118 (1990). However,

allegations must consist of more than mere labels, legal conclusions, or a "formulaic recitation of the elements of a cause of action," and bare legal conclusions are "not entitled to the assumption of truth." Iqbal, 129 S. Ct. at 1949-50.

The facial plausibility standard is met when "the plaintiff pleads factual content that allows the court to draw the reasonable inference that the defendant is liable for the misconduct alleged." Iqbal, 129 S. Ct. at 1949. This does not

require a showing of a "probability" of misconduct, but it does demand more than "a sheer possibility that a defendant has acted 21

unlawfully."

See id.

Thus, "where the well-pleaded facts do

not permit the court to infer more than the mere possibility of misconduct," dismissal is appropriate. Starr, 592 F.3d at 321

(quoting Iqbal, 129 S. Ct. at 1950); see also Twombly, 550 U.S. at 570 (where "plaintiffs . . . have not nudged their claims across the line from conceivable to plausible, their complaint must be dismissed"). Indeed, when "however true," the

allegations in a complaint "could not raise a claim of entitlement to relief, this basic deficiency should be exposed at the point of minimum expenditure of time and money by the parties and the court." See Twombly, 550 U.S. at 558.

Although civil RICO actions generally need not do more than meet the routine pleading requirements outlined above, courts are particularly mindful of these standards in the context of a civil RICO claim, the assertion of which often has "an almost inevitable stigmatizing effect on those named as defendants." World Wrestling Entm't, Inc. v. Jakks Pac., Inc.,

530 F. Supp. 2d 486, 495-96 (S.D.N.Y. 2007) (internal quotation and citation omitted); see also Nichols v. Mahoney, 608 F. Supp. 2d 526, 536 (S.D.N.Y. 2009)("A civil RICO lawsuit has vast implications for the defendants because of the specter of treble damages and the possibility of permanent reputational injury to defendants from the allegation that they are `racketeers.'"). Because of this likely powerful effect on potentially innocent 22

defendants who face the threat of treble damages, and the concomitant potential for abuse of RICO's potent provisions, the court is aware of a particular imperative in cases such as the one at bar, "to flush out frivolous [civil] RICO allegations at an early stage of the litigation." World Wrestling Entm't, 530

F. Supp. 2d at 496 (internal quotation and citation omitted). Moreover, where, as here, a plaintiff alleges RICO predicate acts based upon fraudulent activities such as mail or wire fraud, a plaintiff must additionally satisfy the particularity requirements of Federal Rule of Civil Procedure 9(b) ("Rule 9(b)"). See City of New York v. Smokes-Spirits.Com,

Inc., 541 F.3d 425, 446 (2d Cir. 2008), rev'd on other grounds sub nom. Hemi Group, LLC v. City of New York, 130 S. Ct. 983 (2010) ("Allegations of mail or wire fraud must be made with the particularity required by Federal Rule of Civil Procedure 9(b)." (citation omitted)). The court will thus examine below the mail

and wire fraud allegations in the context of Rule 9(b)'s particularity requirements. B. Application to Federal RICO Claims The RICO statute, 18 U.S.C. Section 1964(c), provides a private right of action to any person injured in its business or property by reason of a violation of Section 1962. U.S.C. §§ 1961-1968. See 18

RICO generally provides for harsh criminal

and civil penalties and in the context of a private RICO action, 23

any defendant found liable under Section 1964(c) faces the "drastic" penalties of "treble damages, costs and attorneys fees." See H.J., Inc. v. Nw. Bell Tel. Co., 492 U.S. 229, 233

(1989) (citing 18 U.S. C. §§ 1963 and 1964(c)). In order to recover under Section 1964(c), a private plaintiff must plead "(1) the defendant's violation of [18 U.S.C] § 1962, (2) an injury to the plaintiff's business or property, and (3) causation of the injury by the defendant's violation." Lerner v. Fleet Bank, N.A., 459 F.3d 273, 283 (2d

Cir. 2006) (quoting Commercial Cleaning Servs., L.L.C. v. Colin Serv. Sys., Inc., 271 F.3d 374, 380 (2d Cir. 2001)). A showing

under the first element, the defendant's violation of 18 U.S.C. § 1962, may be made in any one of four ways. Specifically, "any

person" may be liable for violating 18 U.S.C. § 1962 who: (i) uses or invests income derived "from a pattern of racketeering activity" to acquire an interest in or to operate an enterprise engaged in interstate commerce, § 1962(a); (ii) "acquire[s] or maintain[s], directly or indirectly, any interest in or control of" such an enterprise "through a pattern of racketeering activity," § 1962(b); (iii) by being "employed by or associated with" such an enterprise, "conduct[s] or participate[s], directly or directly, in the conduct of such enterprise's affairs through a pattern of racketeering activity," § 1962(c);

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or (iv) conspires to violate the substantive provisions of § 1962 (a), (b), or (c), § 1962(d). See H.J., 492 U.S. at 232-33.

Significantly, in order to adequately allege a violation of any one of the substantive provisions of the RICO Act, 18 U.S.C. § 1962(a)-(c), a plaintiff must plead a "pattern of racketeering activity." See 18 U.S.C. § 1962(a)-(c).

Further, an underlying substantive violation must be shown in order to establish a conspiracy under 18 U.S.C. § 1962(d). id. § 1962(d). See

"Thus, under any prong of § 1962, a plaintiff in

a civil RICO suit must establish a `pattern of racketeering activity.'" Spool v. World Child Int'l Adoption Agency, 520

F.3d 178, 183 (2d Cir. 2008) (internal citation and quotation omitted) ("To establish a substantive RICO violation, a plaintiff must show a `pattern of racketeering activity,' 18 U.S.C. § 1962(a)-(c), and to establish a RICO conspiracy, a plaintiff must show a conspiracy to commit a substantive RICO violation, id. § 1962(d)."). Further, in order to survive a

motion to dismiss, such "pattern of racketeering activity" must be "adequately alleged in the complaint." Id.

1. Each Substantive RICO Claim Fails Because Plaintiffs Fail to Plead Any Predicate Acts and Fail to Plead Fraud With Particularity Here, plaintiffs have alleged in Counts One through Five of the Complaint that defendants committed substantive RICO violations in violation of 18 U.S.C. Section 1962 (a), (b), and 25

(c).

However, because plaintiffs have failed as a matter of law

to plead any underlying predicate acts which could form the basis for a "pattern of racketeering activity," the substantive RICO violations alleged in Counts One through Five cannot survive defendants' motions to dismiss. Moreover, the claims

must fail because they fail to meet the heightened pleading requirements for fraud under Rule 9(b). a) Failure to Plead Predicate Acts as a Matter of Law First, plaintiffs' RICO claims fail as a matter of law because the claims fail to plead any RICO predicate acts. The

RICO statutory scheme defines "racketeering activity" to include "a host of criminal offenses, which are in turn defined by federal and state law." Cofacredit, S.A. v. Windsor Plumbing

Supply Co. Inc., 187 F.3d 229, 242 (2d Cir. 1999) (citing 18 U.S.C. § 1961(1)). Specifically, the RICO statute defines

"racketeering activity" as including any "act" indictable under various specified federal statutes, including the mail and wire fraud statutes. See 18 U.S.C. § 1961(1) (defining "racketeering

activity" to include offenses indictable under 18 U.S.C. §§ 1341 (relating to mail fraud) and 1343 (relating to wire fraud)); see also Smokes-Spirits.Com, 541 F.3d at 434 n.9 ("Mail fraud and wire fraud are forms of `racketeering activity' for purposes of RICO.") (citation omitted). "Pattern" is defined by the statute

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as "at least two acts of racketeering activity" within a tenyear period. 18 U.S.C. § 1961(5).

To state a claim for mail and wire fraud, a plaintiff must allege: "(1) the existence of a scheme to defraud, (2) the defendant's knowing participation in the scheme, and (3) the use of wire, mail, or television communications in interstate commerce in furtherance of the scheme." F.3d 168, 170-71 (2d Cir. 1999). Chanayil v. Gulati, 169

To prove mail or wire fraud,

the plaintiff need not show that a defendant personally mailed or wired anything themselves, but that they "caused it to be done." Smokes-Spirits.com, 541 F.3d at 446 (citation omitted).

The "gravamen" of the mail fraud offense is the "scheme to defraud," and "any mailing that is incident to an essential part of the scheme satisfies the mailing element . . . even if the mailing itself contains no false information." Bridge v.

Phoenix Bond & Indemnity Co., 553 U.S. 639, 647 (2008) (internal quotations and citations omitted). In the Complaint, plaintiffs purport to allege various predicate acts of mail and wire fraud allegedly committed by defendants in the course of "defend[ing] fee claims" and "commenc[ing] and litigat[ing] six phony lawsuits." (Compl. ¶

27

1.)

Specifically, plaintiffs allege that various defendants

committed mail and wire fraud predicate acts19 by: Mailing a Reply to Counterclaims, Plaintiff's First Notice for Discovery, Plaintiff's Cross-Notice to Take Deposition, and Verified Bill of Particulars, to attorney Douglas Capuder ("Capuder") on February 9, February 9, February 9, and February 22, 2007, respectively, (Compl. ¶ 58(A-D)); Mailing letter regarding subpoena to Capuder and DeGregorio on June 14, 2007, (Compl. ¶ 58(E)); Mailing Bushman's Affirmation in Opposition to Motion to Disqualify to a party unspecified in the Complaint dated March 17, 2007, (Compl. ¶ 60(A)); Mailing letter regarding adjourning motion filing deadlines to Bushman and Capuder on January 10, 2008, (Compl. ¶ 64(A)); Mailing Affirmation in Opposition to Cross-Motion, Cover letter for Respondent's Post-Trial Brief, Cover letter for Respondent's Proposed Counter-Judgment and Affirmation in Support from Bushman to Curtis Law Firm, DeGregorio and the Court on March 28, 2005, September 15, 2006, and October 13, 2006, respectively, (Compl. ¶ 68(A), 72(A-B)); Mailing letter regarding a 90-day extension of time from Bushman to the Court, DeGregorio, and the Curtis Law Firm dated October 21, 2005, (Compl. ¶ 78(A));

From the comprehensive list of the Complaint's alleged predicate acts enumerated here, the court omits two apparent allegations of defamation. First, plaintiffs allege conclusorily that "numerous confusing and misleading statements" by Levitt during oral argument on January 26, 2009 constitute "predicate acts of mail fraud and wire fraud." (Compl. ¶ 124(B).) Second, plaintiffs allege conclusorily that defendants "falsely disparage[ed] the Curtis Law Firm by misrepresenting its litigation history to . . . clients . . . ." (Id. ¶ 143(B); see also id. ¶ 1(B).) It is unclear how plaintiffs seek to characterize these isolated oral statements as mail and wire fraud involving use of the mails and wires. Regardless, because these claims apparently attempt to allege defamation rather than mail or wire fraud, and because it is well-established that defamation does not meet the definition of a RICO predicate act, the court notes its disregard of these conclusory and apparently superfluous allegations. See, e.g., Kimm v. Chang Hoon Lee, No. 04-cv-5724 (HB) 2005 U.S. Dist. LEXIS 727 at *16-17 (S.D.N.Y. Jan. 13, 2005) (collecting cases finding that defamation cannot be a RICO predicate act).

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Mailing letter regarding service via fax from Bushman to the Curtis Law Firm dated November 9, 2006, (Compl. ¶ 78(B)); Mailing letter regarding the sale of DeGregorio's home in order to have "adequate funds with which to pay any judgment" to the Curtis Law Firm and DeGregorio dated December 29, 2006, (Compl. ¶ 78(C)); Mailing letter submitting replacement Appellant's brief to the Court dated May 31, 2007, (Compl. ¶ 81(A)); Mailing letter to Court regarding an agreement reached between counsel in connection with the contents of the court record to the Court dated July 26, 2007, (Compl. ¶ 81(B)); Mailing letter regarding an adjournment of deadlines to the Appellate Division dated September 11, 2007, (Compl. ¶ 81(C)); Mailing Notice of Settlement, Notice of Entry, and Answering Affirmation of Levy from Levy to the Court, Bushman, the Curtis Law Firm, and DeGregorio on July 8, August 5, and October 14, 2008, respectively, (Compl. ¶ 88(A-C)); Mailing Order to Show Cause with Affirmation from Levy to the Court, Bushman, and DeGregorio on or about October 2, 2008 and October 10, 2008, (Compl. ¶ 88(D)); Mailing Affirmation in Opposition to Motion to Dismiss, second Affirmation in Opposition to Motion to Dismiss, Verified Bill of Particulars, Supplemental Verified Bill of Particulars, Affirmation in Opposition to Motion for Summary Judgment, and Affirmation in Opposition to total Disqualification, from Bushman to Capuder, the Court, and Turansky and dated February 17, March 24, July 26, and October 4, 2005, and February 7, and 13, 2006, respectively, (Compl. ¶ 113(A-F)); Mailing letter from Turansky to the Court and Capuder and Bushman dated February 26, 2007, (Compl. ¶ 115(B)); Mailing Notice of Motion and request for jury trial and Omnibus Notice of Motion containing an Amended Reply to 29

Counterclaims and an affidavit by Turansky from Levitt to either the Court and/or the Curtis Law Firm dated June 14, 2008 and February 22, 2009, respectively, (Compl. ¶ 124(A, C-E)); and Mailing letters in February 2009 and a verified complaint dated January 8, 2009 from Nichols to various judges in the New York County Supreme Court, (see Compl. ¶¶ 130 (A-F)). Plaintiffs themselves succinctly and accurately summarize these alleged predicate acts as consisting of "litigation activities." 113.) (See, e.g., id. ¶¶ 58, 60, 68, 72, 88,

Plaintiffs further characterize these "litigation

activities" as "multiple instances of mail fraud in violation of 18 U.S.C. § 1341." 208, 214, 219.) (Id. ¶¶ 156, 166, 172, 178, 184, 192, 202,

Additionally, plaintiffs portray the alleged

"numerous" phone calls from Turansky in Connecticut to Bushman in New York (id. ¶¶ 113(H), 115(A)) and Nichols' use of wire transmissions to fax copies of letters to various New York State Court judges and other counsel (id. ¶ 130 (A-F)) as "multiple instances of wire fraud in violation of 18 U.S.C. § 1343" (id. ¶¶ 156, 166, 172, 178, 184, 192, 202, 208, 214, 219). These

allegations fail to state a claim upon which relief may be granted for several reasons. Even a cursory review of the predicate acts alleged in the Complaint reveals that plaintiffs' summary of these actions

30

as "litigation activities" is apt.20 60, 68, 72, 88, 113.)

(See, e.g., Compl. ¶¶ 58,

Thus, the predicate acts alleged in the

Complaint all involve the mailing of litigation documents such as pleadings (for example, a Reply to Counterclaims (id. ¶ 58(A)), discovery notices (for example, Plaintiff's First Notice for Discovery (id. ¶ 58(B)), requests for adjournments (for example, a letter regarding an adjournment dated January 10, 2008 (id. ¶ 64(A)), and other ministerial documents (for example, letters regarding service via fax or submitting a replacement copy of a brief (id. ¶¶ 78(B), 81(A)). Indeed, as

the Bushman defendants correctly point out, each and every mailing specified in the Complaint "involves the service, filing, or exchange of documents related to a pending legal action." (Bushman Mem. at 11.) The same appears to be true

regarding the alleged wire fraud. This understanding ­ that the alleged RICO predicate acts are no more than "litigation activities" alone ­ brings
Plaintiffs fail in their conclusory attempt to recast certain letters as nefariously connected to an alleged scheme to fraudulently convey DeGregorio's Westhampton home and thereby defraud the Curtis Law Firm. Rather, plaintiffs' conclusory allegations notwithstanding, on their face the letters identified by plaintiffs as intended to "delay, hinder, and defraud" the Curtis Law Firm are no more than additional standard litigation-related letters. (See Compl. ¶ 78(A) (letter dated October 21, 2005 regarding a 90day extension of time in the quantum meruit hearing); ¶ 78(B) (letter dated November 9, 2006 regarding service via fax); and (78(C) (letter dated December 29, 2006 noting that the sale of DeGregorio's home was accomplished in order to have "adequate funds with which to pay any judgment").) Plaintiffs' other allegations regarding allegedly fraudulent conveyances are merely conclusory and not entitled to the presumption of truth. (See, e.g., id. ¶¶ 138, 143(E), 157, 193.)
20

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into focus plaintiffs' rather striking theory of the case. Plaintiffs essentially allege that any client with the impudence to contest the Curtis Law Firm's legal fees, and further, to litigate in court that client's obligation to pay those fees or challenge through a malpractice action the professional conduct of the Curtis Law Firm, and any attorney who represents such a client, is a racketeer and liable for treble damages. The

gravamen of the Complaint is thus that defendants' have violated RICO by defending against plaintiffs' fee claims or initiating malpractice actions against plaintiffs and thereby forcing plaintiffs to litigate allegedly "phony" and "frivolous" lawsuits in state court. This theory cannot withstand a motion

to dismiss because it fails to state a claim upon which relief may be granted. First, persuasive authority in this and other jurisdictions suggests that the litigation activities alleged in this Complaint cannot properly form the basis for RICO predicate acts. See, e.g., Gunn v. Palmieri, No. 87-cv-1418, 1989 WL

119519, at *1 (E.D.N.Y. Sept. 29, 1989), aff'd, 904 F.2d 33 (2d Cir. 1990), cert. denied, 498 U.S. 1049 (1991) (rejecting "untenable" interpretation of RICO which would permit litigation activities to be construed as RICO predicate acts). Thus, on

similar facts, a number of courts have found that allegations such as those here more properly may be classified as claims 32

sounding in abuse of process21 or malicious prosecution.22

See,

e.g., Daddona v. Gaudio, 156 F. Supp. 2d 153, 162 (D. Conn. 2000) (finding allegations "at best amount to vague abuse of process or malicious prosecution claims" where complaint lists "a variety of `predicate acts,' all of which involve the filing of complaints and other legal documents"); Nakahara v. Bal, No. 97-cv-2027, 1998 U.S. Dist. LEXIS 825, at *20-21, *27 (S.D.N.Y. Jan. 30, 1998) (finding that plaintiffs' mail and wire fraud claims are at most "a potential yet still inchoate claim for malicious prosecution or abuse of process" where "the gravamen of [plaintiffs'] Complaint . . . is patently directed at [the defendant's] filing of, or participation in, the various legal actions pending against [plaintiffs]"); Von Bulow v. Von Bulow, 657 F. Supp. 1134, 1140-42 (S.D.N.Y. 1987) (finding that the "essence of the stated [fraud] claim" sounds in malicious

In New York, "a malicious abuse of process claim lies against a defendant who (1) employs regularly issued legal process to compel performance or forbearance of some act (2) with intent to do harm without excuse or justification, and (3) in order to obtain a collateral objective that is outside the legitimate ends of the process." Shain v. Ellison, 273 F.3d 56, 68 (2d Cir. 2001) (quoting Cook v. Sheldon, 41 F.3d 73, 80 (2d Cir. 1994)).
22

21

"In order to prevail in an action for malicious prosecution in New York, a plaintiff must show: (1) the initiation of an action by the defendant against [him], (2) begun with malice, (3) without probable cause to believe it can succeed, (4) that ends in failure or, in other words, terminates in favor of the plaintiff. In addition, if the proceeding of which plaintiff complains was a civil action, the plaintiff must prove special injury -- some interference with [the] plaintiff's person or property . . . beyond the ordinary burden of defending a lawsuit." Engel v. CBS, Inc., 145 F.3d 499, 502 (2d Cir. 1998) (internal quotations and citations omitted).

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prosecution where plaintiffs' allegations "closely parallel[ed] the elements of malicious prosecution claim). Similarly, here, although plaintiffs have styled their allegations as mail and wire fraud, plaintiffs' allegations in fact focus entirely upon the "litigation activities" involved in defendants' allegedly "phony" and "frivolous" litigation with plaintiffs. Plaintiffs' allegations thus loosely track the

elements for a malicious prosecution claim in that (1), plaintiffs allege an action against plaintiffs, (plaintiffs allege defendants' commencement of various malpractice actions (id. ¶ 1(C)), (2) begun with malice (plaintiffs allege prosecution of such actions by "acts of champerty," "corruption" and "deceitful" schemes employing "suborned perjury and deceit of the court" (id. ¶ 141-142)), and (3) without probable cause (plaintiffs allege defendants' prosecution of "knowingly false legal malpractice claims" and challenge of "the right to earned legal fees" (id. ¶ 142)). See Engel, 145 F.3d at 502.

However, plaintiffs fail to allege that the state court litigation underlying their allegations has terminated in plaintiffs' favor, or even terminated at all, a required element of any malicious prosecution claim. See id. Indeed, to the

contrary, plaintiffs affirmatively allege that the fee disputes are ongoing. (See Compl. ¶¶ 88(E), 124(F), and 130(G).) See

Further, plaintiffs fail to allege any special injury. 34

Engel, 145 F.3d at 502.

Thus, despite plaintiffs' creative

attempts to plead mail and wire fraud, the court finds that plaintiffs' incomplete allegations at best attempt to make out a malicious prosecution claim.23 Without more, such allegations that the state court litigation is frivolous, fraudulent, or baseless­ essentially claims of malicious prosecution ­ without more, cannot constitute a viable RICO predicate act. See, e.g., Daddona, 156

F. Supp. 2d at 162 ("Attempts to characterize abuse of process or malicious prosecution claims as mail and wire fraud violations for RICO purposes have been scrutinized by the courts, and have been rejected where the only allegedly fraudulent conduct relates to the filing of documents in litigation."); see also Park South Assocs. v. Fischbein, 626 F. Supp. 1108, 1114 (S.D.N.Y. 1986), aff'd, 800 F.2d 1128 (2d Cir. 1986) (rejecting plaintiffs' RICO claims on various grounds including that plaintiff "has not pled" a RICO predicate act

Alternatively, and even more obviously beyond the scope of RICO, plaintiffs' claims may be construed as an attempt to re-litigate in federal court the still-pending fee claims plaintiffs have lodged in state court. (See, e.g., Compl. ¶¶ 12, 13, 14 (alleging amounts of unpaid fees allegedly owed to the Curtis Law Firm by Turansky, DeGregorio, and Nichols, respectively); see also Pl. Bushman Mem. at 24, n.14.) For example, according to plaintiffs' own allegations, the state court ruled against the Curtis Law Firm in its Turansky fee claim. (See Compl. 116.) Nonetheless, and although the Turansky fee claim is still pending in the State court (id. ¶ 124(F)), plaintiffs here claim that the hearing officer's determination relied on "false testimony" and essentially seek to rehash and review the merits of that fee claim under the guise of RICO.

23

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although "[p]laintiffs' allegations may make out a state court action for abuse of process"). Further, and even more compelling than the persuasive authority discussed above, plaintiffs' claims must be rejected because finding otherwise ­ and allowing malicious prosecution claims such as those attempted to be alleged here to suffice as RICO predicate acts ­ would lead to absurd results. First, if

routine litigation activities such as defending against a fee claim or prosecuting a malpractice action against a former attorney is a violation of RICO, then almost every state or federal action could lead to corollary federal RICO actions. See Kashelkar v. Rubin & Rothman, 97 F. Supp. 2d 383, 392 (S.D.N.Y. 2000) ("Garden-variety pleading errors and the filing of routine motions do not constitute RICO predicate acts. hold otherwise would turn every state court lawsuit into a predicate for a subsequent federal RICO action."). Plaintiffs' To

interpretation of RICO is untenable and would result in the inundation of federal courts with civil RICO actions that could potentially subsume all other state and federal litigation in an endless cycle where any victorious litigant immediately sues opponents for RICO violations. See, e.g., Gunn, 1989 WL 119519,

at *1 ("If serving and filing an answer or a motion by any defendant . . . could be considered . . . [a RICO predicate act], this Court would be flooded with motions to amend 36

complaints by plaintiffs seeking to add RICO claims based upon mail fraud and obstruction of justice as soon as an answer was served. Such an interpretation of the RICO statute is

untenable."); see also Morin v. Trupin, 711 F. Supp. 97, 106 (S.D.N.Y. 1989) ("The Court finds absurd plaintiffs' apparent suggestion that a lawyer's act in posting a letter which states a client's legal position in a dispute can constitute mail fraud. If such were the situation, every dispute in which the

parties' counsel exchanged letters could give rise to RICO litigation. Such activity is simply not fraudulent.") (quoting

Paul S. Mullin & Assocs., Inc. v. Bassett, 632 F. Supp. 532, 540 (D. Del. 1986)). Indeed, as Levitt correctly points out, were

this court to permit plaintiffs' Complaint in this action to move forward, defendants could conceivably countersue plaintiffs for RICO conspiracy violations based upon the many allegations and statements by plaintiffs in this action which defendants might similarly contend are frivolous or false. Mem. at 6.) Additionally, this absurd result would chill litigants and lawyers and frustrate the well-established public policy goal of maintaining open access to the courts. See Engel, 182 (See Levitt

F.3d at 129 (noting generally "strong public policy of open access to the courts for all parties and [need] to avoid ad infinitum [litigation] with each party claiming that the 37

opponent's previous action was malicious and meritless") (internal quotation and citation omitted). If any litigant's or

attorney's pleading and correspondence in an unsuccessful lawsuit could lead to drastic RICO liability in a private right of action, litigants might hesitate to avail themselves of the courts and available legal remedies or be unable to find representation to help vindicate their rights. See Morin, 711

F. Supp. at 105 ("Congress could not have intended that the mail and wire fraud statute sweep up correspondence between attorneys, dealing at arm's length on behalf of their parties, concerning an issue in pending litigation . . . . Subjecting

[such] letter[s] . . . to the mail fraud statute would chill an attorney's efforts and duty to represent his or her client in the course of pending litigation.") (internal quotation and citation omitted). Moreover, allowing the federal RICO statute to usurp underlying legitimate state court litigation as proposed by plaintiffs here would inappropriately bypass the state tribunal where the action is pending and which properly controls that proceeding. Should plaintiffs' vague allegations of "phony" and

"frivolous" litigation, "suborned perjury" and "deceit of court" have merit, plaintiffs' should direct such claims to the state courts where these acts are allegedly occurring and where the underlying litigation is still pending. 38 This court flatly

rejects plaintiffs' contention that "there is . . . no remedy to be found in state courts merely by suing Bushman based on only one, or even several, of the seven underlying cases . . . ." (Pl. Bushman Mem. at 28 n.23.) Rather, this court has full

confidence that the New York State courts where the underlying litigation is currently pending are fully competent to address any such wrongs and this court is unconvinced that such issues should be re-litigated in federal court under the guise of a RICO action. See, e.g., Daddona 156 F. Supp. 2d at 162 ("If a

suit is groundless or filed in bad faith, the law of torts may provide a remedy. Resort to a federal criminal statute is

unnecessary.") (citation omitted); see also Nakahara, 1998 U.S. Dist. LEXIS 825, at *31 ("The claims of `fraud' advanced here can be asserted as effectively, if not more so, in each of [the] ongoing [underlying] proceedings. Indeed, this RICO action adds

nothing except the in terrorem effect of a treble damage claim and the expense of conducting litigation over these same issues in yet another forum."). Finally, the Congressional intent in enacting RICO does not square with the absurd consequences and contraventions of well-settled public policy which would inevitably result from allowing RICO predicate acts to be based upon the type of malicious prosecution claims alleged here. to be read broadly." Certainly, "RICO is

Sedima, S.P.R.L. v. Imrex Co., 473 U.S. 39

479, 497-98 (1985) (noting that "the lesson" of RICO's broad interpretation is evident "not only [from] . . . Congress' selfconsciously expansive language and overall approach, but also . . . [from] its express admonition that RICO is to `be liberally construed to effectuate its remedial purposes'") (internal citation omitted). However, there can be no dispute that

"Congress did not intend to effect a wholesale preemption of state civil law in its enactment of RICO." Supp. at 1143. Von Bulow, 657 F.

Permitting the "litigation activities" alleged

here to serve as RICO predicate acts would lead to just such an absurd result, in contravention of RICO's admittedly broad remedial purpose. See United States v. Eisen, 974 F.2d 246, 254

(2d Cir. 1992) (noting the "understandable reluctance" on the part of Congress "to use federal criminal law as a back-stop for all state court litigation"). For all of these reasons, this court joins a long line of cases in finding, as a matter of law, that the "litigation activities" pleaded in the Complaint cannot constitute predicate acts for the purposes of RICO. See, e.g., Directv, Inc. v.

Lewis, No. 03-cv-6241, 2005 U.S. Dist. LEXIS 8187, at *22 (W.D.N.Y. Apr. 29, 2005) ("courts have held that serving litigation documents by mail cannot be a predicate act to establish mail fraud under the RICO statute"); Kashelkar, 97 F. Supp. 2d at 393 ("soundly" rejecting "contention that" 40

"legitimate conduct of attorneys representing their clients in pending litigation" can "constitute mail or wire fraud"); Daddona, 156 F. Supp. 2d at 162 ("Courts have found that allegations of malicious prosecution or abuse of process do not, on their own, suffice as predicate acts for a RICO violation."); Nakahara, 1998 U.S. Dist. LEXIS 825, at *24 n.7 ("The core conclusion . . . that the threat of litigation or the initiation of unjustified lawsuits c