Shiu et al v. New Peking Taste Inc. et al

Filing 66

MEMORANDUM AND ORDER ADOPTING 56 Report ans Recommendation IN PART AND MODIFIED IN PART. Jung & Associates, Celis, and Neiman are jointly and severally liable for a sanction of $5,215 in attorney's fees, to be awarded to Plaintiffs and Celis and Neiman shall be referred to the Disciplinary Committee of this District. Plaintiffs' motion for attachment is denied.. Ordered by Judge Nicholas G. Garaufis on 5/24/2013. (Marziliano, August)

UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF NEW YORK

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SHIV, MAN WEI, AND LIN, DAN FENG, on
behalf of themselves and others similarly situated,
Plaintiffs,

MEMORANDUM & ORDER
11-CV-1175 (NGG) (RLM)

-againstNEW PEKING TASTE INC., d/b/a NEW PEKING
TASTE RESTAURANT, GEN J(U SHU, )(lAO
MEl WANG, JOHN DOE, JANE DOE, and ABC
CORPORATION,
Defendants.

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NICHOLAS G. GARAUFIS, United States District Judge.
Plaintiffs filed this putative class action in March 2011, alleging numerous violations of
federal and state employment law arising from their employment at Defendant New Peking Taste
Restaurant. (See Compl. (Dkt. 1).) After a series of unproductive conferences with the court and
with Magistrate Judge Roanne L. Mann, Plaintiffs moved for attachment and an award of
attorneys' fees. (See Mot. for Attach. (Dkt. 31); Mot. for Fees (Dkt. 41).) The court referred
both motions to Judge Mann for a Report and Recommendation ("R&R") pursuant to 28 U.S. C.
§ 636(b). (See July 3, 2012, Order (Dkt. 47).) On March 14,2013, Judge Mann issued an R&R
recommending that the court: (1) grant, in substantial part, Plaintiffs' motion for attorney's fees;
(2) refer certain attorneys who have appeared on Defendants' behalf to the appropriate
disciplinary committees; and (3) deny Plaintiffs' motion for attachment. (See R&R (Dkt. 56).)
For the reasons explained below, Judge Mann's recommendation is ADOPTED IN PART AND
MODIFIED IN PART.

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I.

BACKGROUND
The factual background underlying Plaintiffs' motions is set forth in meticulous detail in

Judge Mann's R&R. (See id. at 2-11.) The pertinent facts for this Memorandum & Order are as
follows.

A.

Overview of Relevant Proceedings

Defendants have been represented by several different attorneys. The first attorney to
enter an appearance for Defendants was Andrew Bersin, who appeared in the case in April 2011,
shortly after the Complaint was filed. (See Not. of Appearance (Dkt. 7).) Bersin filed an
appearance as an attorney employed by the "Law Office of Andrew Bersin." (MJ In August
2011, Lydia Celis made a motion to substitute herself as Defendants' attorney, explaining that
Bersin had a family emergency. (Mot. to Substitute Attorney (Dkt. 18).) She filed an
appearance as an attorney in the firm of lung & Associates. (!sh)
On November 21,2011, the parties filed a "consent to substitute attorney" indicating
substitution of the law firm of Neiman & Wang Associates P.C. by and through its attorney Mark
Weissman in place of Jung & Associates by and through Celis. (Consent to Substitute Attorney
(Dkt. 23).) However, the court ordered that Weissman provide proof that he was admitted in this
district (Dec. 7, 2011, Order re Mot. to Substitute Attorney), and because he failed to do so, the
court eventually denied his motion to be substituted as attorney (Dec. 15,2011, Order Denying
Mot. to Substitute Attorney). The court admonished that Celis was obligated to continue to
represent Defendants until she was relieved by the court. (MJ
In February 2012, Plaintiffs moved to strike Defendants' Answer based on their failure to
respond to any discovery requests, and for attachment based on Defendants' possible efforts to
transfer their interest in the restaurant with the intent to defraud Plaintiffs and otherwise frustrate

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Plaintiffs' potential judgment. (See Dkts. 31-34; May 7, 2012, Order.) Before the pre-motion
conference, David Lira filed a notice of appearance on behalf of Defendants. (See Not. of
Appearance (Dkt. 35).) The court ordered that the Notice of Appearances was inadequate, and
that Defendants were required to file a motion for substitution of counsel in order to effect any
change in counsel. (May 16, 2012, Order.)
After the counsel of record-Celis-did not appear at the scheduled pre-motion
conference, the court adjourned the conference and ordered Celis to appear, along with a
principal from the law firm ofNeiman & Wang. (May 16,2012, Minute Entry.) Celis appeared
the next day, but the law firm sent a paralegal. (May 17,2012, Minute Entry.) At the
conference, the court concluded that "[n]o one could explain Neiman Wang's involvement in the
case" (id.) and ordered that Neiman must "pay attorney's fees for the plaintiff[s'] attorney
showing up on a number of different occasions where Mr. Neiman didn't show up" (see May 17,
2012, Hr'g Tr. (Dkt. 49) at 17). The court also concluded that "[i]t remains unknown whether
Ms. Celis was the source of various submissions filed under her name over the last six months"
and ordered Celis to appear on May 21, 2012, with a principal from Jung & Associates. (May
17, 2012, Minute Entry.)
On May 21, 2012, Celis, Neiman, and Lira appeared before the court, along with Yoo
Jung, appearing as a principal from Jung & Associates. (May 21,2012, Minute Entry.) The
court directed that counsel file a proper motion for Lira to be substituted as counsel, but that
releasing the other attorneys from the case did not foreclose the possibility of sanctions against
them. (See May 21,2012, Hr'g Tr. (Dkt. 50) at 12 (explaining that Plaintiffs "have every right
to seek attorneys' fees").) On May 24,2012, the court entered an order relieving Celis from the
case. (May 24, 2012, Order.)

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Yoo Jung has never entered a notice of appearance on the docket in this case and is not
admitted in this district. (See Jung Aff. in Response to Order to Show Cause (Dkt. 54-1) ~ 2;
Jung Aff. in Supp. ofObj. (Dkt. 57-1) ~ 3.) She explains that her role is as follows:
Defendants ... came to me to represent them in this action. Because I was
not admitted to the bar of this Court, I could not appear on their behalf in
this action. Instead, I found [Celis], who had advised me that she was a
member of this Court's bar, and asked her to act as Jung & Associates' cocounsel in this matter. My role in this case was to provide Celis with such
assistance (including paralegal assistance) as she required.
(Jung Aff. in Supp. ofObj. ~ 3.)

B.

Procedural History

On June 15,2012, Plaintiffs made a motion for attorney's fees, asking that Defendants,
Neiman, Wang & Associates, Jung & Associates, and Lira be required to pay attorney's fees
totaling $6,600.00 arising from Plaintiffs' appearances at the May 2012 conference with the
court. (See Mem. in Supp. of Mot. for Fees (Dkt. 42).) Defendants opposed this motion. (See
Def. Opp'n to Mot. for Fees (Dkt. 46).) On July 3, 2012, the court referred Plaintiffs' motion for
attachment and motion for attorney's fees to Judge Mann for an R&R. (July 3, 2012, Order.)
On February 26, 2013, Judge Mann issued an Order to Show Cause why Lydia Celis,
Yoo Jung, and Jeffrey Neiman and their respective law firms should not be referred to the
appropriate disciplinary committees as a result of their conduct in this matter. (See Order to
Show Cause (Dkt. 52).) Judge Mann found that "Plaintiffs' motion raises serious questions
about the manner in which defense counsel conducted themselves in this matter," and directed
the individual attorneys to show cause why they and their respective law firms should not be
referred to the appropriate disciplinary proceedings as a result of said conduct.

C!f!J Jung

responded, on behalf of herself and Jung & Associates, opposing referral to a disciplinary
committee. (See Resp. to Order to Show Cause (Dkt. 54).)
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Judge Mann issued her R&R on March 14,2013, recommending that the court: (1) grant,
in substantial part, Plaintiffs' motion for attorney's fees; (2) refer certain attorneys who have
appeared on Defendants' behalf to the appropriate disciplinary committees; and (3) deny
Plaintiffs' motion for attachment. (R&R.) She ordered that objections to the R&R were due by
April1,2013. (Id.at29.) OnAprill, YooJungobjectedonbehalfofherselfandJung&
Associates. (Obj. to R&R (Dkt. 57).) In her objection, Jung argues that she and the firm should
not be jointly and severally liable for the attorneys' fees, nor should she be referred to an
attorney disciplinary committee. (IQ) None of the other individuals objected to the R&R, and
the time to do so has passed.

II.

DISCUSSION
A.

Standard

When a district court receives timely objections to a magistrate judge's R&R, the court
makes "a de novo determination of those portions of the report or specified proposed findings or
recommendations to which objection is made. [The district court] may accept, reject, or modify,
in whole or in part, the findings or recommendations made by the magistrate judge." 28 U.S.C.
§ 636(b)(l); see also Fed. R. Civ. P. 72(b)(2) ("[A] party may serve and file specific written
objections to the [R&R]."). Portions of the R&R to which a party makes no objection are
reviewed for clear error. U.S. Flour Com. v. Certified Bakery. Inc., No. 10-CV-2522
(JS) (WDW), 2012 WL 728227, at *2 (E.D.N.Y. Mar. 6, 2012).

B.

Analysis
1.

Motion for Attorneys' Fees

In recommending that the court grant Plaintiffs' motion for attorneys' fees, Judge Mann
relied on the court's statement at the May 17,2012, conference that Defendants' attorneys would

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have to pay for Plaintiffs' legal fees in connection with the unnecessary trips to the courthouse
for the unproductive conferences. (See R&R at 12-13 (citing May 17,2012, Hr'g Tr. at
11 :5-17).) Judge Mann also found that the attorneys' fees were a proper sanction under Federal
Rule of Civil Procedure 16(f), which authorizes the court to impose sanctions based on an
attorney's failure to appear at a conference with the court or failure to be substantially prepared
and participate. @,(citing Fed. R. Civ. P. 16(f)).)
Jung objected to the portion of Judge Mann's R&R recommending that she and her law
firm be liable for the attorneys' fees, but not the portions concluding that sanctions are warranted
and analyzing the amount of fees to which Plaintiffs are owed. (See Obj. at 4-6.) Finding no
clear error in Judge Mann's determination that sanctions were warranted and her calculation of
fees, the court adopts it in full, and reviews de novo only Judge Mann's determination that Jung
and Jung & Associates should be jointly and severally liable with the other parties for the
sanction of fees.
In her objection, Jung argues that she and her law firm should not be liable for the fees
awarded because "all delays in this action were not caused by Ms. Y oo Jung or by Jung &
Associates." (Obj. at 4.) According to her, the delays "occurred after defendants retained new
counsel, when the new counsel sought to substitute in as counsel." (l4J Judge Mann's award of
fees, however, is calculated based on Plaintiffs' counsel's attendance at the December 6, 2011,
May 16, 2012, May 17, 2012, and May 21, 2012, conferences. (See R&R at 17-18.) During this
time, Celis was counsel of record for the Defendants (see May 24, 2012, Order (relieving Celis
from the case)), and Celis was "act[ing] as Jung & Associates' co-counsel in this matter" (Jung
Aff. in Supp. ofObj. '1[3). Jung argues that Celis' actions are not related to Jung & Associates,

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however, because "Celis represented to this court that she was an associate of Jung & Associates.
That is not the case. She received no salary or benefits from Jung & Associates."

@, 4.)

Nevertheless, the court finds that sanctions against the firm are appropriate. Defendants
first approached Jung to represent them, but because Jung was not admitted in this district, she
approached Celis to enter an appearance in this case. (I d. , 3.) Celis entered an appearance
identifying Jung & Associates as the firm of record. After approaching Celis to take on a case
for the firm and sharing the fees from the case with her, the firm carmot now disclaim Celis'
actions simply because she was not on their permanent payroll. What is more, the court's
concern about Defendants' representation involved questions about the firm itself, Celis's
affiliation with the firm, the firm's involvement in other filings submitted under Celis's name,
and the firm's failure to send adequate counsel to conferences with the court. (See May 16,
2012, Minute Entry; May .17, 2012, Minute Entry; May 21, 2012, Minute Entry.) Therefore,
Judge Marm's conclusion that Jung & Associates should be liable for the sanction is correct.
Jung also objects to her own individual liability for the sanctions, and points out that she
is not admitted in this district, nor did she enter an appearance in this case. (See Jung Obj. at
5-6.) Plaintiffs did not request sanctions against Jung personally, but only against Jung &
Associates. (See Mot. for Fees at 6.) What is more, Jung is already liable to the extent of her
financial interest in Jung & Associates. For these reasons, the court finds that sanctions against
the firm are sufficient and concludes that Jung should not be personally liable for the sanctions.
Judge Marm's R&R is thus modified accordingly.
2.

Referral to Disciplinary Committees

Judge Marm recommends that the court refer Celis, Jung, and Neiman, along with their
respective law firms, to the appropriate attorney disciplinary committees. (See R&R at 19-21.)

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Celis and Neiman have not filed any objections to this recommendation, and the time to do so
has passed. Thus, the court reviews Judge Mann's recommendation as to Celis and Neiman for
clear error. U.S. Flour Com., 2012 WL 728227, at *2. Finding none, the court adopts Judge
Mann's recommendation that they be referred to the Disciplinary Committee of this District.
In determining that Jung be referred to the relevant disciplinary .committee, Judge Mann
relied on: (I) contradictory statements in Jung's submissions to the court; (2) her refusal to take
any responsibility for the delays in this case; (3) the "irrelevant and inflammatory comments"
Jung made in an affidavit about Plaintiffs' counsel and his alleged connection with the Chinese
Communist Party; and (4) evidence that Jung is lying about Neiman Wang's employment at Jung
& Associates, and perhaps entering appearances in other cases in this district even though she is
not admitted here. (R&R at 19-21.)
Jung objected that she should not be referred to this district's disciplinary committee
because she was not responsible for the delays in this case, and is not admitted in this district.
(See Obj. at 5-7.) With respect to the allegations against Plaintiffs' counsel, she "request[s] that
the Court do[es] not blemish the reputation of a young lawyer by referring her for discipline for a
lapse in judgment." _(!d. at 5 n.6.) Local Civil Rule 1.5 Governing Discipline of Attorneys
provides that in addition to imposing discipline on any member of the bar of this Court for a
variety of reasons, the Disciplinary Committee of this District may impose discipline when "in
connection with activities in this Court, any attorney is found to have engaged in conduct
violative ofthe New York State Rules of Professional Conduct." Local Civ. R. 1.5 (emphasis
added).
The court has reviewed Jung's submissions in this case and finds her contradictory
contentions and inflammatory comments extremely disturbing. Because, however, she is not

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admitted in this district and she has not entered an appearance in this case, the court will not refer
her to the Disciplinary Committee ofthis District. Rather, the court advises Jung that any further
misconduct on her part before this court will not be tolerated. Judge Mann's R&R is modified to
reflect that Jung has been admonished for her behavior in this case but will not be referred to the
Disciplinary Committee at this juncture.
3.

Motion for Attachment

No objections have been filed to Judge Mann's recommendation that Plaintiffs motion
for attachment be denied, and the time to do so has passed. The court finds no clear error in
Judge Mann's determinations and adopts this portion of her R&R. Plaintiffs' motion for
attachment is thus denied.

III.

CONCLUSION
For the reasons explained above, Judge Mann's R&R is ADOPTED IN PART AND

MODIFIED IN PART. Jung & Associates, Celis, and Neiman are jointly and severally liable for
a sanction of$5,215 in attorney's fees, to be awarded to Plaintiffs. Celis and Neiman shall be
referred to the Disciplinary Committee of this District. Plaintiffs' motion for attachment is
denied.
SO ORDERED.

ngg

RA~

Dated: Brooklyn, New York
May~2013

NICHOLAS G.
United States District Judge

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