Knopick v. Connelly et al

Filing 134

MEMORANDUM (Order to follow as separate docket entry) re 132 MOTION for Sanctions filed by Nicholas Knopick. Signed by Honorable Sylvia H. Rambo on 11/25/13. (pw)

IN THE UNITED STATES DISTRICT COURT
FOR THE MIDDLE DISTRICT OF PENNSYLVANIA
NICHOLAS KNOPICK,
Plaintiff
v.
PHILIP A. DOWNEY,
Defendant

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Civil No. 1:09-CV-1287

Judge Sylvia H. Rambo

MEMORANDUM
In this civil action, Plaintiff sued his prior attorneys for legal
malpractice related to their representing him in connection with a property settlement
agreement and prosecution of a legal malpractice action arising therefrom. Presently
before the court is Plaintiff’s motion for sanctions, in which he requests the court
impose sanctions upon defense counsel and Defendant Downey himself1 on the basis
that Defendant Downey’s recent motion to implead Plaintiff’s counsel was baseless,
filed in bad faith, and before the court with the intent to disrupt litigation. (Doc.
132.) For the following reasons, the motion for sanctions will be denied.

I.

Background
Because the court writes primarily for the parties, and because the facts

of record have been summarized by this court in six separate memoranda (see, e.g.,
Doc. 29 (granting Connelly Defendants’ motion to dismiss); Doc. 32 (granting
Defendant Downey’s motion for summary judgment); Doc. 88 (denying Defendant
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Plaintiff requests the court impose sanctions upon both defense counsel and Defendant
Downey himself because they both are licensed attorneys and are held to the appropriate level of
conduct as members of the bar regardless of whether they are acting in their role as attorneys. The court
will refer to defense counsel, Robert Sink, and Defendant, Philip Downey, collectively as “Defendant
Downey.”

Downey’s second motion for summary judgment following remand); Doc. 107
(denying Defendant Downey’s motion for judgment on the pleadings and Plaintiff’s
motion for reconsideration); Doc. 121 (denying Defendant Downey’s motion for
certification to file an interlocutory appeal); Doc. 128 (denying Defendant Downey’s
motion for leave to file a third party complaint)), the court will only outline the facts
and procedural history essential to this memorandum.
On July 6, 2009, Plaintiff initiated this case by filing a complaint in
which he named two sets of defendants, and brought, what Plaintiff labeled as, a
breach of contract claim against the Connelly Defendants arising from their state
court representation of Plaintiff in the PSA proceedings (Count I), and a legal
malpractice (Count II) and breach of contract claim (Count III) against Defendant
Downey in connection with his failure to adequately prosecute Plaintiff’s legal
malpractice claim against the Connelly Defendants. (See Doc 1.)
On December 29, 2009, the court granted the Connelly Defendant’s
motion to dismiss on the basis that the applicable two-year statute of limitations2 had
expired prior to the complaint’s July 22, 2009 filing date. (Doc. 29.) In arriving at
its decision, the court found that, despite Plaintiff labeling Count I as breach of
contract against the Connelly Defendants, the allegations contained therein were
more properly asserted as an action sounding in tort rather than contract. (Id.) Thus,
although the court recognized that a plaintiff may bring a malpractice claim under
both contract and tort theories of liability under Pennsylvania law, it held that
Plaintiff’s claim as pleaded against the Connelly Defendants arose in tort, and
applied Pennsylvania’s two-year statute of limitations applicable to malpractice tort

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The court found that the two-year statute of limitations for legal malpractice claims
applied to Plaintiff’s claim against the Connelly Defendants. (See Doc. 29, pp. 9-10.)
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claims. (See id.) Plaintiff neither sought to file an amended complaint properly
stating a viable cause of action for breach of contract nor appealed the court’s ruling.
On October 11, 2013, Defendant Downey filed a motion seeking leave
to file a third party complaint against Plaintiff’s current counsel (“Counsel”). (Doc.
119.) In his motion, Defendant Downey acknowledged that he was beyond the time
permitted to file a third party complaint by both the applicable Federal Rules of Civil
Procedure and Local Rules of Court, but requested the court nevertheless permit him
to implead Counsel. (Doc. 120, p. 6 of 9.) Defendant Downey’s proposed claim
arose from Counsel’s failure to properly plead a breach of contract action against the
Connelly Defendants (see Doc. 119-1, ¶¶ 17, 21), and sought contribution from
Counsel for any liability he may incur if found to have committed malpractice. (Id.
at ¶¶ 22-23.) Defendant Downey justified the timing of his belated request by
arguing it was first during Plaintiff’s deposition when he discovered that the
Connelly Defendants breached Plaintiff’s specific instructions, at which time he
realized that there existed a basis for a breach of contract action against the Connelly
Defendants. (See Doc. 120, p. 5 of 9.) Defendant Downey reasoned that, because
the deposition demonstrated a breach of contract action existed, and because Counsel
failed to adequately plead such a claim in this action, Counsel was negligent in their
representation of Plaintiff, which allowed the Connelly Defendants out of the case,
effectively placing all liability, if any, on Defendant Downey’s shoulders to bear
alone.
On November 12, 2013, the court denied Defendant Downey’s motion
(Doc. 129) finding that the motion was extremely untimely, and that impleading
Counsel at that stage of the litigation certainly would prejudice Plaintiff, cause a
conflict of interest requiring Plaintiff to retain new counsel, delay trial, and
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complicate issues (Doc. 128). The court also expressed its skepticism regarding
Defendant Downey’s explanation for the belated nature of his request, citing: (1)
Defendant Downey’s deposition testimony on November 26, 2012, wherein he
recalled the same facts to which Plaintiff testified during his September 5, 2013
deposition; (2) Defendant Downey’s February 25, 2008 letter to Plaintiff, in which
he expressed his professional opinion that a viable breach of contract action against
the Connelly Defendants existed; and (3) the parties’ July 22, 2011 case management
plan, in which Defendant Downey expressed his intention to bring a third-party
claim against Counsel for the very purpose he sought to do so in his motion filed
over two years later.
Two days after the court issued its memorandum and order denying the
motion to implead Counsel and twenty days after Plaintiff served a copy of the
instant motion upon Defendant Downey (see Doc. 131; Doc. 132, ¶ 34), Defendant
Downey filed a praecipe to withdraw his motion (Doc. 130). In his letter, filed on
November 14, 2013, Defendant Downey stated his intention of ensuring he was
protected by the “safe harbor” provision of Federal Rule of Civil Procedure 11.
(Doc. 131.)
Despite Defendant Downey’s withdrawing his motion within 21 days
after service of the motion for sanctions, see Fed. R. Civ. P. 11(c)(2), Plaintiff filed
the instant motion requesting sanctions on November 15, 2013. (Doc. 132.)
Plaintiff’s motion largely reiterates his arguments advanced in opposition of
Defendant Downey’s motion seeking to implead Counsel, highlighting the
discrepancies between Defendant Downey’s averments and the record. Plaintiff
alleges that Defendant Downey made misrepresentations to the court and
characterizes Defendant Downey’s attempt to implead Counsel as “frivolous” (Id. at
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¶ 30) and “vexatious” (Id. at ¶ 46), and further alleges that the attempt was made “in
bad faith with the intent to disrupt this litigation” (Id. at ¶ 45). Plaintiff concedes
that, due to Defendant Downey’s withdrawing his motion within 21 days, Plaintiff
can no longer seek sanctions by motion under Rule 11, but requests the court
sanction Defendant Downey pursuant to 28 U.S.C. § 1927.
The issue has been adequately briefed. See M.D. Pa. L. R. 7.6
(“Nothing in this rule shall be construed to limit the authority of the court to grant
any motion before expiration of the prescribed period for filing a brief in
opposition.”).

II.

Discussion
Plaintiff moves for sanctions against Defendant Downey pursuant to 28

U.S.C. § 1927, arguing that sanctions are appropriate because Defendant Downey
provided false statements to the court in support of his motion to file a third party
complaint and that the motion was made in bad fath and for an improper purpose.
A.

Legal Standard

Section 1927 provides:
Any attorney or other person admitted to conduct cases in
any court of the United States or any Territory thereof who
so multiplies the proceedings in any case unreasonably and
vexatiously may be required by the court to satisfy
personally the excess costs, expenses, and attorneys’ fees
reasonably incurred because of such conduct.
28 U.S.C. § 1927. To violate Section 1927, an attorney must be found to have: “(1)
multiplied proceedings; (2) in an unreasonable and vexatious manner; (3) thereby
increasing the cost of the proceedings; and (4) doing so in bad faith or by intentional
misconduct.” In re Schaefer Salt Recovery, Inc., 542 F.3d 90, 101 (3d Cir. 2008). A
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party seeking an award of attorney’s fees under Section 1927 bears a heavy burden.
“Courts should exercise [discretion to award Section 1927 sanctions] only in
instances of a serious and studied disregard for the orderly process of justice.” Ford
v. Temple Hosp., 790 F.2d 342, 347 (3d Cir. 1986). The Third Circuit has held that
“sanctions may not be imposed under § 1927 absent a finding that counsel’s conduct
resulted from bad faith, rather than misunderstanding, bad judgment, or wellintentioned zeal.” Grider v. Keystone Health Plan Cent., Inc., 580 F.3d 119, 142 (3d
Cir. 2009) (quoting LaSalle Nat’l Bank v. First Conn. Holding Grp., 287 F.3d 279,
288 (3d Cir. 2002). “Indications of this bad faith are findings that the claims
advanced were meritless, that counsel knew or should have known this, and that the
motive for filing the suit was for an improper purpose.” In re Prudential Ins. Co.
Am. Sales Practice Litig., 278 F.3d 175, 188 (3d Cir. 2002) (quoting Smith v. Detroit
Fed’n of Teachers Local 231, 829 F.2d 1370, 1375 (6th Cir. 1987)).
B.

Application

The court will not impose sanctions on Defendant Downey under
Section 1927. While the court concluded that Defendant Downey’s motion seeking
to implead Counsel was extremely weak, contained an incomplete legal analysis,3
marginally increased the cost of litigation, and that the delay in bringing the motion
was suspect, sanctions are not warranted. Plaintiff himself has identified the
possibility that Defendant Downey may be able to pursue a claim for contribution
against Counsel. (See Doc. 124, p. 35 of 39 (“Downey can simply file a contribution
claim after this litigation.”.) Thus, although the court has not expressed its opinion
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In his opening brief, Defendant Downey analyzed the prejudice Counsel would suffer
should the motion be granted. However, the prejudice inquiry focuses on whether Plaintiff – not
Counsel – would be prejudiced by the belated third party complaint. The court provides Defendant
Downey with the benefit of the doubt in assuming this inaccurate analysis is a product of defense
counsel’s oversight rather than an intentional attempt to delude.
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regarding the viability of such a claim, it appears that Plaintiff is of the opinion that a
claim for contribution may exist and be asserted at a later date. The court does not
conclude that Defendant Downey’s attempt to implead Counsel was entirely without
merit or made entirely in bad faith. Rather, the court will give Defendant Downey
the benefit of the doubt and attribute the motion to Defendant Downey’s
overzealousness. Thus, sanctions under Section 1927 are not warranted in this case.

III.

Conclusion
Although the court found little merit in Defendant Downey’s motion

seeking to implead Counsel, it does not conclude that the motion was made in bad
faith. Defendant Downey, through his counsel, is advised to ensure the
representations made in support of any motion are well-founded and accurately
represent the record and the law. Based on the foregoing, Defendant Downey’s
conduct does not require the imposition of sanctions under 28 U.S.C. § 1927.
An appropriate order will issue.

s/Sylvia H. Rambo
SYLVIA H. RAMBO
United States District Judge
Dated: November 25, 2013.

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