Aquino v. Alexander Capital LP

Filing 72

ORDER granting 49 Motion to Disqualify Counsel; granting 63 Letter Motion for Discovery; denying 69 Motion for Reconsideration re 49 MOTION to Disqualify Counsel Jan Schlichtmann. filed by NESA Management LLC, Rocco Guidi cipietro, Alexander Capital LP, Joseph Amato, 63 MOTION for Discovery . filed by NESA Management LLC, Rocco Guidicipietro, Alexander Capital LP, Joseph Amato, 69 MOTION for Reconsideration re; Oral Argument, Set Hearin gs,, . filed by John J. Aquino Earlier today, the Court held a hearing regarding one or more false statements contained in the Declaration of Daniel M. Glosband, Esq., ECF 53-2, submitted in support of plaintiff's opposition to defe ndants' motion to disqualify plaintiff's counsel, Jan Schlichtmann, Esq. In a written submission filed before the hearing, Schlichtmann conceded that he authored the offending statements in the Glosband Declaration, ECF 66, and at the heari ng, both Glosband and Schlichtmann conceded that at least one statement in the declaration was false and that another was misleading, if not also false, though both Glosband and Schlichtmann maintained that the making of these false or misleading sta tements was the result of negligence and not an intent to mislead. Nevertheless, there is no doubt that the Court relied on the offending statements in its August 6, 2021 denial without prejudice of the defendants' motion to disqualify Schlichtm ann, ECF 49. As the conclusion of the hearing, the Court made the following rulings from the bench, which it hereby restates: The Court will not refer the matter of the false statements to the U.S. Attorney's Office for possible criminal invest igation, because it concludes that Schlichtmann and Glosband lacked the mens rea necessary to support a perjury charge. The Court will, however, consider referring this matter to the Grievance Committee of the U.S. District Court for the Southern Dis trict of New York. The Court now grants defendants' motion to disqualify Schlichtmann as plaintiff's counsel, ECF 49. This ruling takes effect immediately. The case is stayed for one week from the date of this Order to provide plaintiff w ith an opportunity to engage new lead counsel. However, if plaintiff does not engage new counsel within one week of this order, then the previously engaged local counsel, Stephen Z. Starr, Esq. shall be responsible for representing the plaintiff in t his matter moving forward, consistent with the representation Mr. Schlichtmann made to the Court during the August 6, 2021 argument on the defendants disqualification motion. See Transcript of August 6, 2021 Argument, ECF 58, at 4-5. If within the ne xt week new counsel in fact enters an appearance, such counsel may convene a joint phone conference with Chambers to move for a limited additional stay. The Court grants defendants motion to reopen discovery and to compel Mr. Schlichtmanns depositio n, ECF 63. This deposition shall be scheduled for a date after new plaintiff's counsel has been engaged or the time to do so has run. Defendants have leave to file a renewed motion to compel production of documents from Mr. Schlichtmann and fro m third-party witnesses whose depositions were facilitated by plaintiff, pursuant to the Amended Case Management Plan. See ECF 63 at 4 (motion); see also ECF 61 § H(3) (Amended Case Management Plan). The Court will wait to set a deadline for pla intiff's response until plaintiff has retained new counsel or the time to do so has elapsed. All further deadlines set forth in the Amended Case Management Plan are adjourned sine die. The Court denies Plaintiff's motion for reconsideration of the decision to proceed with the evidentiary hearing, ECF 69. SO ORDERED. Attorney Jan Richard Schlichtmann terminated.. (Signed by Judge Jed S. Rakoff on 11/18/2021) (kv)

Case 1:21-cv-01355-JSR Document 72 Filed 11/18/21 Page 1 of 3

UNITED STATES DISTRICT COURT
SOUTHERN DISTRICT OF NEW YORK
JOHN J. AQUINO,
Chapter 7 Trustee,
by its assignee, Convergent
Distributors of Texas, LLC,

21-cv-1355 (JSR)

Plaintiff-Counter-Defendant,

ORDER

-vALEXANDER CAPITAL, LP, and its
Managing Partners:
JOSEPH AMATO,
ROCCO GUIDICIPIETRO, and
NESA MANAGEMENT, LLC,
Defendants-Counter-Claimants.
JED S. RAKOFF, U.S.D.J.:
Earlier today, the Court held a hearing regarding one or more
false statements contained in the Declaration of Daniel M. Glosband,
Esq., ECF 53-2, submitted in support of plaintiff’s opposition to
defendants’

motion

to

disqualify

plaintiff’s

counsel,

Jan

Schlichtmann, Esq. 1 In a written submission filed before the hearing,
Schlichtmann conceded that he authored the offending statements in the
Glosband Declaration, ECF 66, and at the hearing, both Glosband and
Schlichtmann conceded that at least one statement in the declaration
was false and that another was misleading, if not also false, though
both Glosband and Schlichtmann maintained that the making of these
false or misleading statements was the result of negligence and not
The Court denies Plaintiff’s motion for reconsideration of the
decision to proceed with the evidentiary hearing, ECF 69.
1

1

Case 1:21-cv-01355-JSR Document 72 Filed 11/18/21 Page 2 of 3

an intent to mislead. Nevertheless, there is no doubt that the Court
relied on the offending statements in its August 6, 2021 denial without
prejudice of the defendants’ motion to disqualify Schlichtmann, ECF
49.
As the conclusion of the hearing, the Court made the following
rulings from the bench, which it hereby restates:
•

The Court will not refer the matter of the false statements
to the U.S. Attorney’s Office for possible criminal
investigation, because it concludes that Schlichtmann and
Glosband lacked the mens rea necessary to support a perjury
charge. The Court will, however, consider referring this
matter to the Grievance Committee of the U.S. District Court
for the Southern District of New York.

•

The Court now grants defendants’ motion to disqualify
Schlichtmann as plaintiff’s counsel, ECF 49. This ruling
takes effect immediately.

•

The case is stayed for one week from the date of this Order
to provide plaintiff with an opportunity to engage new lead
counsel. However, if plaintiff does not engage new counsel
within one week of this order, then the previously engaged
local counsel, Stephen Z. Starr, Esq. shall be responsible
for representing the plaintiff in this matter moving
forward, consistent with the representation Mr. Schlichtmann
made to the Court during the August 6, 2021 argument on the
defendants’ disqualification motion. See Transcript of
August 6, 2021 Argument, ECF 58, at 4-5. If within the next
week new counsel in fact enters an appearance, such counsel
may convene a joint phone conference with Chambers to move
for a limited additional stay.

•

The Court grants defendants’ motion to reopen discovery and
to compel Mr. Schlichtmann’s deposition, ECF 63. This
deposition shall be scheduled for a date after new
plaintiff’s counsel has been engaged or the time to do so
has run.

•

Defendants have leave to file a renewed motion to compel
production of documents from Mr. Schlichtmann and from
third-party witnesses whose depositions were “facilitated”
by plaintiff, pursuant to the Amended Case Management Plan.
See ECF 63 at 4 (motion); see also ECF 61 § H(3) (Amended
2

Case 1:21-cv-01355-JSR Document 72 Filed 11/18/21 Page 3 of 3

Case Management Plan). The Court will wait to set a deadline
for plaintiff's response until plaintiff has retained new
counsel or the time to do so has elapsed.
•

All further deadlines set forth in
Management Plan are adjourned sine die.

SO ORDERED.
New York, NY
November 18, 2021

3

the

Amended

Case