Preview
FILED: NEW YORK COUNTY CLERK 07/03/2019 12:41 PM INDEX NO. 150315/2019
NYSCEF DOC. NO. 29 RECEIVED NYSCEF: 07/03/2019
EXHIBIT F
FILED: NEW YORK COUNTY CLERK 07/03/2019 12:41 PM INDEX NO. 150315/2019
NYSCEF DOC. NO. 29 RECEIVED NYSCEF: 07/03/2019
Knopf v. Esposito, Not Reported in Fed. Supp. (2018)
2018 WL 1226023
Paykin. For the reasons below, the motions are denied
to the extent they seek imposition of sanctions against
KeyCite Yellow Flag - Negative Treatment or Paykin.
Greenberg Dorsey's motion is otherwise
Amended in Part by Knopf v. Esposito, S.D.N.Y., July 25, 2018
granted, Esposito's motion is granted in part, and the
2018 WL 1226023
motions by Akerman and Feldman are denied.
Only the Westlaw citation is currently available.
United States District Court, S.D. New York.
Norma KNOPF and Michael Knopf, Plaintiffs, BackFround
v.
This action is one of four filed in federal court by
Frank M. ESPOSITO, Dorsey & Whitney, LLP,
the Knopfs. The federal actions are related to a state
Nathaniel H. Akerman, Edward S. Feldman, .
court action the Knopfs filed in 2009 (the "State Court
and Michael Hayden Sanford, Defendants.
Action"). Broadly, the State Court Action arises out of
two 2006 loans the Knopfs made to Pursuit Holdings,
17cv5833(DLC)
LLC ("Pursuit"), a company controlled by Sanford,
for the purchase of New York City properties (the
Signed o3/o5/2018
"Properties"). In the State Court Action, the Knopfs sued
Attorneys and Law Firms Sanford and Pursuit for breach of contract, alleging that
Pursuit and Sanford violated their agreement to grant
For the Plaintiffs: Eric W. Berry, Berry Law PLLC, 745 the Knopfs mortgages on the Properties, and sought to
Fifth Avenue, 5th Floor, New York, NY 10151, Gary have a constructive trust imposed on Pursuit's interest
Greenberg, 666 Fifth Avenue, 27th Floor, New York, NY in the Properties. orders issued in
By July, October,
10103· and November 2015, the Appellate Division denied the
Knopfs'
attempts to restrain the sale of one of the
For Defendant Frank M. Esposito: Frank M. Esposito,
. Properties ("PHC"). In February 2016, Pursuit sold PHC
Esposito, PLLC, 275 Madison Avenue, 14th Floor, New
to a third party, Michael Phillips ("Phillips"). In June
York ' NY 10016
2016, before the most recent federal actions were filed,
Knopfs'
For Defendants & Whitney, and Nathaniel the Appellate Division denied the motion that
Dorsey LLP,
H. Akerman: Nathaniel H. Akerman, Amanda sought, inter alia, contempt sanctions against Sanford on
Prentice,
Krista E. Bolles, & Whitney 51 West 52nd the theory that the sale of PHC violated a temporary
Dorsey LLP,
New NY Peter M. 50 restraining order issued by a Justice of the Appellate
Street, York, 10019, Lancaster,
South Sixth Suite MN 55402. Division. That order explained that as of November 2015
Street, 1500, Minneapolis,
there were no longer any court-ordered encumbrances on
For Defendant Edward S. Feldman: Edward S. Feldman, the sale of PHC. The Knopfs obtained summary judgment
570 Grand Avenue, Englewood, NJ 07631. on their breach of contract claims against Pursuit and
Sanford in the State Court Action in December 2014, see
Knopf v. Sanford, 123 A.D.3d 521 (Ist Dep't 2014), but
OPINION & ORDER they have not yet obtained a final judgment in the State
Court Action.
DENISE COTE, United States District Judge
The Knopfs filed the first of the related federal actions
*1 On December 7, 2017, the Court granted motions to
on July 1, 2015, against Meister, Seelig & Fein, LLP
dismiss filed by the defendants Frank M. Esposito, Dorsey
("MSF") and Pursuit (the "MSF Action"). MSF had
& Whitney, LLP ("Dorsey"), Nathaniel H. Akerman,
represented Pursuit in the State Court Action and had
Edward S. Feldman, and Michael Hayden Sanford. .
been successful in opposing restramts on the sale of
Esposito, Dorsey, Akerman, and Feldman have now
PHC. To secure payment to MSF for its services, Pursuit
moved for attorney's fees and sanctions against plaintiffs
executed a mortgage on PHC in favor of MSF. In
Michael and Norma Knopf (the "Knopfs") and their
the MSF Action, the Knopfs alleged that the mortgage
attorneys Eric W. Berry, Gary Greenberg, and Joseph N.
on PHC in favor of MSF constituted an actual and
WESTLAW © 2019 Thomson Reuters. No claim to original U.S. Govemment Works, 1
FILED: NEW YORK COUNTY CLERK 07/03/2019 12:41 PM INDEX NO. 150315/2019
NYSCEF DOC. NO. 29 RECEIVED NYSCEF: 07/03/2019
Knopf v. Esposito, Not Reported in Fed. Supp. (2018)
2018 WL 1226023
constructive fraudulent conveyance. On March 22, 2016,
the Court dismissed the actual fraudulent conveyance In the Esposito Action, the Knopfs sued Sanford and three
claim on the pleadings. Knopf v. Meister, Seelig & sets of attorneys who had represented Sanford or entities
Fein, LLP, No. 15cv5090(DLC), 2016 WL 1166368 with which he is associated. Defendant Feldman had been
(S.D.N.Y. Mar. 22, 2016). On April 21, 2017, the Court retained by Pursuit to assist in the sale of PHC. Defendant
granted summary judgment to MSF on the constructive Akerman is a partner at defendant Dorsey. Akerman, with
fraudulent conveyance claim. Knopf v. Meister, Seelig Feldman, made a telephone call in January of 2016 to
& Fein, LLP, No. 15cv5090(DLC), 2017 WL 1449511 investigate the status of state court restraints on the sale
(S.D.N.Y. Apr. 21, 2017). Pursuit defaulted because no of PHC. Esposito had been hired by MH Sanford & Co.,
attorney entered an appearance on its behalf, but the LLC to act as its general counsel, but did not represent
default was vacated in light of the dismissal of all of the anyone in connection with the sale of PHC. The Knopfs
Knopfs'
claims. The Knopfs appealed on May 11, 2017. alleged a conspiracy by Sanford and the three attorneys to
Knopfs'
violate the civil rights, as well as several state law
*2 The Knopfs filed their second federal lawsuit on fraud and tortious interference claims, all in connection
August 22, 2016, against Pursuit and Phillips (the "Phillips with the sale of PHC.
Action"). Phillips had purchased PHC from Pursuit
in an arms-length transaction. Sanford appeared at an The principal basis for the Esposito Action was the
initial conference for the case and was thereafter added January 2016 telephone call that Akerman and Feldman
at his request as a defendant. In the Phillips Action, placed to a state court employee. Unbeknownst to
the Knopfs sued Pursuit and Phillips for actual and them, this employee was married to Esposito. The court
constructive fraudulent conveyance in the sale of PHC, employee told the lawyers that the Appellate Division's
sued Phillips for tortious interference with contract, November 2015 order vacated all prior restraints on the
sought a constructive trust on Sanford's interest in sale of PHC. The Knopfs alleged that this communication
Pursuit, and sued Sanford for breach of fiduciary duty constituted an ex p_arte advisory opinion that violated
defendants'
and as an alter ego of Pursuit. Pursuit also defaulted in their due process rights. The Court granted the
this action. On December 12, 2016, the Court dismissed motion to dismiss the federal claim on December 7,
the tortious interference with contract claim. h Knopf 2017, holding that the January 12, 2016 call did no
v. Phillips, No. 16cv6601(DLC), 2016 WL 7192102 more than explain the effect of the Appellate Division's
(S.D.N.Y. Dec. 12, 2016). On December 22, 2017, the orders. S_ee Knopf v. Esposito, No. 17cv5833, 2017 WL
Court granted summary judgment to Phillips on the 6210851, at *6-*7 (S.D.N.Y. Dec. 7, 2017). To the extent
constructive and actual fraudulent conveyance claims. h the Knopfs were unhappy with orders issued by New
Knopf v. Phillips, No. 16cv6601(DLC), 2017 WL 6561163 York state courts, then that court system provided them
redress."
(S.D.N.Y. Dec. 22, 2017). Finally, on February 1, 2018, with "ample avenues of Id.. at *7. The Court
the Court dismissed the remaining claims against Sanford additionally held that the Knopfs failed to plausibly allege
and vacated Pursuit's default in light of the Knopfs having any conspiratorial agreement between the court employee
substantially changed the theories underlying their claims and the defendants. See id. Finally, the Court declined
in their pretrial materials, and due to significant overlap to exercise supplemental jurisdiction over the state law
Knopfs'
between the new theories and the claims advanced claims. The Knopfs appealed on December 28, 2017.
in the State Court Action.
Throughout the state and federal litigation, the Knopfs
The present action is the fourth federal action (the have been represented by Eric W. Berry. His conduct is
"Esposito Action"). Originally, the Knopfs filed this suit at the heart of these motions for sanctions. Berry has
in the Eastern District of New York on July 10, 2017. The several times stated to attorneys
representing Sanford or
lawyers."
Knopfs voluntarily dismissed the Eastern District lawsuit Pursuit that he "sues all of Sanford's Berry also
on July 28, and filed a substantially similar complaint caused a deposition subpoena to be served at 6:30 a.m.
in this Court on August 2, 2017. After Esposito filed a at Esposito's private residence despite having Esposito's
motion to dismiss the complaint on August 12, the Knopfs business address.
filed a First Amended Complaint ("FAC") on September
2.
WESRAW © 2019 Thomson Reuters. No claim to original U.S. Govemment Works. 2
FILED: NEW YORK COUNTY CLERK 07/03/2019 12:41 PM INDEX NO. 150315/2019
NYSCEF DOC. NO. 29 RECEIVED NYSCEF: 07/03/2019
Knopf v. Esposito, Not Reported in Fed. Supp. (2018)
2018 WL 1226023
In addition, the amended complaint in the Esposito Berry later emailed a video recording of Sanford's
Action added unfounded allegations of bribery against deposition testimony to Esposito. The accompanying
Esposito and his wife, the New York state court employee message stated, "watch the whole thing, your name
who participated in the January 2016 telephone call is mentioned at the end. [B]ut that is just the tip of
iceberg[.]"
described above. Berry again accused Esposito of bribery the Notably, Berry does not dispute these
in an October 26, 2017 letter, which Berry also sent to allegations. Thus, despite stating five times on the record
Esposito's wife. In November 2017, Berry reiterated the of a deposition that he was not recording Sanford, Berry
bribery allegation in a message to Esposito and indicated did in fact record Sanford and sent that recording to
]"
that he planned to "disclose[ the "bribery stuff ... into Esposito in order to threaten him with reputational harm.
[D]epartment."
the [S]econd In response to Esposito's
communication seeking to settle the matter, Berry made In the Esposito Action, Esposito, Akerman, Feldman, and
reference to the possibility of articles
being written about Sanford proceeded pro se, and Dorsey was represented
loses?"
the case, stated "Who cares who wins or and by Akerman and other attorneys employed by Dorsey.
this."
"There is no way your career survives Later, in Akerman moved for attorney's fees on his behalf and
response to Esposito sending Berry a letter requesting that on behalf of Dorsey on December 26. Feldman moved
a subpoena for Esposito to testify be withdrawn, Berry for attorney's fees on his own behalf the same day,
wrote "No. You either show, or we begin proceedings to and Esposito moved for attorney's fees and sanctions
arrested...."
have you[ ] on December 27. These motions became fully submitted
January 19, 2018.
*3 Berry also falsely represented during Sanford's
deposition that he was not recording a video of that
deposition. The deposition transcript reads as follows:
Discussion
Sanford: ... Are you videotaping me right now? .
The parties move for fees and sanctions on several
Berry: I'm texting theories. Akerman seeks fees on his own behalf and on
Gary Greenberg. He's my co-counsel.
Sorry. I'll move behalf of Dorsey under 42 U.S.C. § 1988 ("Section 1988")
it down here.
and 28 U.S.C.§ 1927 ("Section 1927"). Feldman seeks fees
[Lorraine] Nadel [attorney for Phillips in the Phillips under Section 1988, Section 1927, and Rule 11, Fed. R.
Action]: Is it your statement on the record that you're Civ. P. Esposito seeks fees under Section 1988, Section
not videotaping him? 1927, Rule 11, Fed. R. Civ. P., and a court's inherent
power to sanction bad faith or vexatious conduct.
Berry: No, of course not. If I had wanted to videotape,
I would have had a videographer.
I. Rule 11
Sanford: You would have had to notice me for that.
No party in this proceeding complied with the strict
. procedural requirements of Rule 1 l. See Fed. R. Civ.
Nadel: If you videotaped him, I ask that you delete it
P. 1 l(c). To the extent the parties invite the Court to
now.
sanction the Knopfs sua sponte, it declines to do so.
Berry: I didn't videotape him. I told you I was texting Accordingly, the motions are denied insofar as they seek
Rule 11 sanctions.
Gary Greenberg, my co-counsel.
Nadel: I just ask that you delete it.
II. Eligibility for Fees Under Sections 1927 and 1988
Sanford: I also ask that you put on the record that you All of the movants seek fees under Sections 1927 and 1988.
did not videotape him. The Knopfs oppose these requests on the grounds that
Akerman, Feldman, and Esposito are pro se attorney-
Berry: I did not videotape him.
parties not eligible to be awarded attorney's fees. The
Knopfs also argue that a law firm such as Dorsey that is
(Emphasis supplied.) Despite Berry's repeated
represented by its own attorney may not receive fees under
representations, Berry had videotaped the deposition.
these statutes where that attorney is also a party.
WESTL AW © 2019 Thomson Reuters. No claim to original U.S. Government Works, 3
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Knopf v. Esposito, Not Reported in Fed. Supp. (2018)
2018 WL 1226023
so. In K_aj, the Supreme Court distinguished between
In the context of fees under Section 1988, the Supreme pro se attorney litigants and organizations as follows:
Court has explained that "an attorney-client relationship "an organization is not comparable to a pro se litigant
1988,"
[is] the predicate for an award under § because because the organization is always represented by counsel,
that statute's "specific purpose was to enable potential whether in-house or pro bono, and thus, there is always
relationship."
plaintiffs to obtain the assistance of competent counsel in an attorney-client 499 U.S. at 436 n.7.
rights."
vindicating their Kay v. Ehrler, 499 U.S. 432, 436
(1991). This rule applies regardless of whether the pro se The First Circuit has addressed a scenario analogous
litigant is an attorney. See id. at 438. to the one presented here, where an individual pro se
plaintiff also represented another individual plaintiff.
*4 Although the Second Circuit has not addressed this S_91 Schneider v. Colegio de Abogados de Puerto Rico,
issue speciñcally as applied to Section 1927, it has done 187 F.3d 30 (Ist Cir. 1999). The court held that the
so in other statutory contexts such as suits against the attorney-plaintiff could recover all relevant fees, even
IRS and suits brought under the federal special education though the attorney-plaintiff also represented himself,
statutes. See, e.g., U.S. Dep't of Justice, Tax Div. v. because "the fees incurred by plaintiffs [were]essentially
Hudson, 626 F.3d 36, 38 (2d Cir. 2010) (IRS suits); S.N. the same whether or not [the attorney-plaintiff) was also a
plaintiff."
ex rel. J.N. v. Pittsford Cent. Sch. Dist., 448 F.3d 601, E
at 32. Additionally, the weight of appellate
604 (2d Cir. (special suits). In a law firm is represented non-
2006) education Hudson, authority where by its own
the Second Circuit noted that the relevant statute, I.R.C. party attorneys is to allow the law firm to recoup fees
§ 7430, provides that a prevailing party is entitled to expended by its own lawyers. See, e.g., Treasurer, Trustees
collect "reasonable fees p. or incurred for the services of Drury Indus., Inc. Health Care Plan & Trust v. Goding,
proceeding."
of attorneys in connection with the court 692 F.3d 888, 898 (8th Cir. 2012) (affirming grant of
626 F.3d at 38 (emphasis in Hudson). Because the p.m attorney's fees under ERISA to law firm represented by
g attorney-litigant had not paid any attorney, the Court its own attorneys and citing cases from 4th, 5th, and D.C.
concluded that he could only recover fees if "he may be Circuits).
said to have incurred attorney's fees by virtue of the time
issue."
he invested litigating the tax E
The Court held Dorsey is eligible to recover the attorney's fees that
that the individual pro se litigant, although an attorney, Akerman and other Dorsey attorneys expended defending
"fee"
could not, for two reasons. First, a is a "charge for the firm in this action. The Kay footnote explaining
services,"
labor or while the individual at most "brought that an "organization is always represented by counsel,
time." bono"
on himself an expenditure of R (citation omitted). whether in-house or pro does not leave room to
agent," non-
Second, an attorney is a person who acts as a "legal distinguish between organizations represe
Preview
FILED: NEW YORK COUNTY CLERK 07/03/2019 12:41 PM INDEX NO. 150315/2019 NYSCEF DOC. NO. 29 RECEIVED NYSCEF: 07/03/2019 EXHIBIT F FILED: NEW YORK COUNTY CLERK 07/03/2019 12:41 PM INDEX NO. 150315/2019 NYSCEF DOC. NO. 29 RECEIVED NYSCEF: 07/03/2019 Knopf v. Esposito, Not Reported in Fed. Supp. (2018) 2018 WL 1226023 Paykin. For the reasons below, the motions are denied to the extent they seek imposition of sanctions against KeyCite Yellow Flag - Negative Treatment or Paykin. Greenberg Dorsey's motion is otherwise Amended in Part by Knopf v. Esposito, S.D.N.Y., July 25, 2018 granted, Esposito's motion is granted in part, and the 2018 WL 1226023 motions by Akerman and Feldman are denied. Only the Westlaw citation is currently available. United States District Court, S.D. New York. Norma KNOPF and Michael Knopf, Plaintiffs, BackFround v. This action is one of four filed in federal court by Frank M. ESPOSITO, Dorsey & Whitney, LLP, the Knopfs. The federal actions are related to a state Nathaniel H. Akerman, Edward S. Feldman, . court action the Knopfs filed in 2009 (the "State Court and Michael Hayden Sanford, Defendants. Action"). Broadly, the State Court Action arises out of two 2006 loans the Knopfs made to Pursuit Holdings, 17cv5833(DLC) LLC ("Pursuit"), a company controlled by Sanford, for the purchase of New York City properties (the Signed o3/o5/2018 "Properties"). In the State Court Action, the Knopfs sued Attorneys and Law Firms Sanford and Pursuit for breach of contract, alleging that Pursuit and Sanford violated their agreement to grant For the Plaintiffs: Eric W. Berry, Berry Law PLLC, 745 the Knopfs mortgages on the Properties, and sought to Fifth Avenue, 5th Floor, New York, NY 10151, Gary have a constructive trust imposed on Pursuit's interest Greenberg, 666 Fifth Avenue, 27th Floor, New York, NY in the Properties. orders issued in By July, October, 10103· and November 2015, the Appellate Division denied the Knopfs' attempts to restrain the sale of one of the For Defendant Frank M. Esposito: Frank M. Esposito, . Properties ("PHC"). In February 2016, Pursuit sold PHC Esposito, PLLC, 275 Madison Avenue, 14th Floor, New to a third party, Michael Phillips ("Phillips"). In June York ' NY 10016 2016, before the most recent federal actions were filed, Knopfs' For Defendants & Whitney, and Nathaniel the Appellate Division denied the motion that Dorsey LLP, H. Akerman: Nathaniel H. Akerman, Amanda sought, inter alia, contempt sanctions against Sanford on Prentice, Krista E. Bolles, & Whitney 51 West 52nd the theory that the sale of PHC violated a temporary Dorsey LLP, New NY Peter M. 50 restraining order issued by a Justice of the Appellate Street, York, 10019, Lancaster, South Sixth Suite MN 55402. Division. That order explained that as of November 2015 Street, 1500, Minneapolis, there were no longer any court-ordered encumbrances on For Defendant Edward S. Feldman: Edward S. Feldman, the sale of PHC. The Knopfs obtained summary judgment 570 Grand Avenue, Englewood, NJ 07631. on their breach of contract claims against Pursuit and Sanford in the State Court Action in December 2014, see Knopf v. Sanford, 123 A.D.3d 521 (Ist Dep't 2014), but OPINION & ORDER they have not yet obtained a final judgment in the State Court Action. DENISE COTE, United States District Judge The Knopfs filed the first of the related federal actions *1 On December 7, 2017, the Court granted motions to on July 1, 2015, against Meister, Seelig & Fein, LLP dismiss filed by the defendants Frank M. Esposito, Dorsey ("MSF") and Pursuit (the "MSF Action"). MSF had & Whitney, LLP ("Dorsey"), Nathaniel H. Akerman, represented Pursuit in the State Court Action and had Edward S. Feldman, and Michael Hayden Sanford. . been successful in opposing restramts on the sale of Esposito, Dorsey, Akerman, and Feldman have now PHC. To secure payment to MSF for its services, Pursuit moved for attorney's fees and sanctions against plaintiffs executed a mortgage on PHC in favor of MSF. In Michael and Norma Knopf (the "Knopfs") and their the MSF Action, the Knopfs alleged that the mortgage attorneys Eric W. Berry, Gary Greenberg, and Joseph N. on PHC in favor of MSF constituted an actual and WESTLAW © 2019 Thomson Reuters. No claim to original U.S. Govemment Works, 1 FILED: NEW YORK COUNTY CLERK 07/03/2019 12:41 PM INDEX NO. 150315/2019 NYSCEF DOC. NO. 29 RECEIVED NYSCEF: 07/03/2019 Knopf v. Esposito, Not Reported in Fed. Supp. (2018) 2018 WL 1226023 constructive fraudulent conveyance. On March 22, 2016, the Court dismissed the actual fraudulent conveyance In the Esposito Action, the Knopfs sued Sanford and three claim on the pleadings. Knopf v. Meister, Seelig & sets of attorneys who had represented Sanford or entities Fein, LLP, No. 15cv5090(DLC), 2016 WL 1166368 with which he is associated. Defendant Feldman had been (S.D.N.Y. Mar. 22, 2016). On April 21, 2017, the Court retained by Pursuit to assist in the sale of PHC. Defendant granted summary judgment to MSF on the constructive Akerman is a partner at defendant Dorsey. Akerman, with fraudulent conveyance claim. Knopf v. Meister, Seelig Feldman, made a telephone call in January of 2016 to & Fein, LLP, No. 15cv5090(DLC), 2017 WL 1449511 investigate the status of state court restraints on the sale (S.D.N.Y. Apr. 21, 2017). Pursuit defaulted because no of PHC. Esposito had been hired by MH Sanford & Co., attorney entered an appearance on its behalf, but the LLC to act as its general counsel, but did not represent default was vacated in light of the dismissal of all of the anyone in connection with the sale of PHC. The Knopfs Knopfs' claims. The Knopfs appealed on May 11, 2017. alleged a conspiracy by Sanford and the three attorneys to Knopfs' violate the civil rights, as well as several state law *2 The Knopfs filed their second federal lawsuit on fraud and tortious interference claims, all in connection August 22, 2016, against Pursuit and Phillips (the "Phillips with the sale of PHC. Action"). Phillips had purchased PHC from Pursuit in an arms-length transaction. Sanford appeared at an The principal basis for the Esposito Action was the initial conference for the case and was thereafter added January 2016 telephone call that Akerman and Feldman at his request as a defendant. In the Phillips Action, placed to a state court employee. Unbeknownst to the Knopfs sued Pursuit and Phillips for actual and them, this employee was married to Esposito. The court constructive fraudulent conveyance in the sale of PHC, employee told the lawyers that the Appellate Division's sued Phillips for tortious interference with contract, November 2015 order vacated all prior restraints on the sought a constructive trust on Sanford's interest in sale of PHC. The Knopfs alleged that this communication Pursuit, and sued Sanford for breach of fiduciary duty constituted an ex p_arte advisory opinion that violated defendants' and as an alter ego of Pursuit. Pursuit also defaulted in their due process rights. The Court granted the this action. On December 12, 2016, the Court dismissed motion to dismiss the federal claim on December 7, the tortious interference with contract claim. h Knopf 2017, holding that the January 12, 2016 call did no v. Phillips, No. 16cv6601(DLC), 2016 WL 7192102 more than explain the effect of the Appellate Division's (S.D.N.Y. Dec. 12, 2016). On December 22, 2017, the orders. S_ee Knopf v. Esposito, No. 17cv5833, 2017 WL Court granted summary judgment to Phillips on the 6210851, at *6-*7 (S.D.N.Y. Dec. 7, 2017). To the extent constructive and actual fraudulent conveyance claims. h the Knopfs were unhappy with orders issued by New Knopf v. Phillips, No. 16cv6601(DLC), 2017 WL 6561163 York state courts, then that court system provided them redress." (S.D.N.Y. Dec. 22, 2017). Finally, on February 1, 2018, with "ample avenues of Id.. at *7. The Court the Court dismissed the remaining claims against Sanford additionally held that the Knopfs failed to plausibly allege and vacated Pursuit's default in light of the Knopfs having any conspiratorial agreement between the court employee substantially changed the theories underlying their claims and the defendants. See id. Finally, the Court declined in their pretrial materials, and due to significant overlap to exercise supplemental jurisdiction over the state law Knopfs' between the new theories and the claims advanced claims. The Knopfs appealed on December 28, 2017. in the State Court Action. Throughout the state and federal litigation, the Knopfs The present action is the fourth federal action (the have been represented by Eric W. Berry. His conduct is "Esposito Action"). Originally, the Knopfs filed this suit at the heart of these motions for sanctions. Berry has in the Eastern District of New York on July 10, 2017. The several times stated to attorneys representing Sanford or lawyers." Knopfs voluntarily dismissed the Eastern District lawsuit Pursuit that he "sues all of Sanford's Berry also on July 28, and filed a substantially similar complaint caused a deposition subpoena to be served at 6:30 a.m. in this Court on August 2, 2017. After Esposito filed a at Esposito's private residence despite having Esposito's motion to dismiss the complaint on August 12, the Knopfs business address. filed a First Amended Complaint ("FAC") on September 2. WESRAW © 2019 Thomson Reuters. No claim to original U.S. Govemment Works. 2 FILED: NEW YORK COUNTY CLERK 07/03/2019 12:41 PM INDEX NO. 150315/2019 NYSCEF DOC. NO. 29 RECEIVED NYSCEF: 07/03/2019 Knopf v. Esposito, Not Reported in Fed. Supp. (2018) 2018 WL 1226023 In addition, the amended complaint in the Esposito Berry later emailed a video recording of Sanford's Action added unfounded allegations of bribery against deposition testimony to Esposito. The accompanying Esposito and his wife, the New York state court employee message stated, "watch the whole thing, your name who participated in the January 2016 telephone call is mentioned at the end. [B]ut that is just the tip of iceberg[.]" described above. Berry again accused Esposito of bribery the Notably, Berry does not dispute these in an October 26, 2017 letter, which Berry also sent to allegations. Thus, despite stating five times on the record Esposito's wife. In November 2017, Berry reiterated the of a deposition that he was not recording Sanford, Berry bribery allegation in a message to Esposito and indicated did in fact record Sanford and sent that recording to ]" that he planned to "disclose[ the "bribery stuff ... into Esposito in order to threaten him with reputational harm. [D]epartment." the [S]econd In response to Esposito's communication seeking to settle the matter, Berry made In the Esposito Action, Esposito, Akerman, Feldman, and reference to the possibility of articles being written about Sanford proceeded pro se, and Dorsey was represented loses?" the case, stated "Who cares who wins or and by Akerman and other attorneys employed by Dorsey. this." "There is no way your career survives Later, in Akerman moved for attorney's fees on his behalf and response to Esposito sending Berry a letter requesting that on behalf of Dorsey on December 26. Feldman moved a subpoena for Esposito to testify be withdrawn, Berry for attorney's fees on his own behalf the same day, wrote "No. You either show, or we begin proceedings to and Esposito moved for attorney's fees and sanctions arrested...." have you[ ] on December 27. These motions became fully submitted January 19, 2018. *3 Berry also falsely represented during Sanford's deposition that he was not recording a video of that deposition. The deposition transcript reads as follows: Discussion Sanford: ... Are you videotaping me right now? . The parties move for fees and sanctions on several Berry: I'm texting theories. Akerman seeks fees on his own behalf and on Gary Greenberg. He's my co-counsel. Sorry. I'll move behalf of Dorsey under 42 U.S.C. § 1988 ("Section 1988") it down here. and 28 U.S.C.§ 1927 ("Section 1927"). Feldman seeks fees [Lorraine] Nadel [attorney for Phillips in the Phillips under Section 1988, Section 1927, and Rule 11, Fed. R. Action]: Is it your statement on the record that you're Civ. P. Esposito seeks fees under Section 1988, Section not videotaping him? 1927, Rule 11, Fed. R. Civ. P., and a court's inherent power to sanction bad faith or vexatious conduct. Berry: No, of course not. If I had wanted to videotape, I would have had a videographer. I. Rule 11 Sanford: You would have had to notice me for that. No party in this proceeding complied with the strict . procedural requirements of Rule 1 l. See Fed. R. Civ. Nadel: If you videotaped him, I ask that you delete it P. 1 l(c). To the extent the parties invite the Court to now. sanction the Knopfs sua sponte, it declines to do so. Berry: I didn't videotape him. I told you I was texting Accordingly, the motions are denied insofar as they seek Rule 11 sanctions. Gary Greenberg, my co-counsel. Nadel: I just ask that you delete it. II. Eligibility for Fees Under Sections 1927 and 1988 Sanford: I also ask that you put on the record that you All of the movants seek fees under Sections 1927 and 1988. did not videotape him. The Knopfs oppose these requests on the grounds that Akerman, Feldman, and Esposito are pro se attorney- Berry: I did not videotape him. parties not eligible to be awarded attorney's fees. The Knopfs also argue that a law firm such as Dorsey that is (Emphasis supplied.) Despite Berry's repeated represented by its own attorney may not receive fees under representations, Berry had videotaped the deposition. these statutes where that attorney is also a party. WESTL AW © 2019 Thomson Reuters. No claim to original U.S. Government Works, 3 FILED: NEW YORK COUNTY CLERK 07/03/2019 12:41 PM INDEX NO. 150315/2019 NYSCEF DOC. NO. 29 RECEIVED NYSCEF: 07/03/2019 Knopf v. Esposito, Not Reported in Fed. Supp. (2018) 2018 WL 1226023 so. In K_aj, the Supreme Court distinguished between In the context of fees under Section 1988, the Supreme pro se attorney litigants and organizations as follows: Court has explained that "an attorney-client relationship "an organization is not comparable to a pro se litigant 1988," [is] the predicate for an award under § because because the organization is always represented by counsel, that statute's "specific purpose was to enable potential whether in-house or pro bono, and thus, there is always relationship." plaintiffs to obtain the assistance of competent counsel in an attorney-client 499 U.S. at 436 n.7. rights." vindicating their Kay v. Ehrler, 499 U.S. 432, 436 (1991). This rule applies regardless of whether the pro se The First Circuit has addressed a scenario analogous litigant is an attorney. See id. at 438. to the one presented here, where an individual pro se plaintiff also represented another individual plaintiff. *4 Although the Second Circuit has not addressed this S_91 Schneider v. Colegio de Abogados de Puerto Rico, issue speciñcally as applied to Section 1927, it has done 187 F.3d 30 (Ist Cir. 1999). The court held that the so in other statutory contexts such as suits against the attorney-plaintiff could recover all relevant fees, even IRS and suits brought under the federal special education though the attorney-plaintiff also represented himself, statutes. See, e.g., U.S. Dep't of Justice, Tax Div. v. because "the fees incurred by plaintiffs [were]essentially Hudson, 626 F.3d 36, 38 (2d Cir. 2010) (IRS suits); S.N. the same whether or not [the attorney-plaintiff) was also a plaintiff." ex rel. J.N. v. Pittsford Cent. Sch. Dist., 448 F.3d 601, E at 32. Additionally, the weight of appellate 604 (2d Cir. (special suits). In a law firm is represented non- 2006) education Hudson, authority where by its own the Second Circuit noted that the relevant statute, I.R.C. party attorneys is to allow the law firm to recoup fees § 7430, provides that a prevailing party is entitled to expended by its own lawyers. See, e.g., Treasurer, Trustees collect "reasonable fees p. or incurred for the services of Drury Indus., Inc. Health Care Plan & Trust v. Goding, proceeding." of attorneys in connection with the court 692 F.3d 888, 898 (8th Cir. 2012) (affirming grant of 626 F.3d at 38 (emphasis in Hudson). Because the p.m attorney's fees under ERISA to law firm represented by g attorney-litigant had not paid any attorney, the Court its own attorneys and citing cases from 4th, 5th, and D.C. concluded that he could only recover fees if "he may be Circuits). said to have incurred attorney's fees by virtue of the time issue." he invested litigating the tax E The Court held Dorsey is eligible to recover the attorney's fees that that the individual pro se litigant, although an attorney, Akerman and other Dorsey attorneys expended defending "fee" could not, for two reasons. First, a is a "charge for the firm in this action. The Kay footnote explaining services," labor or while the individual at most "brought that an "organization is always represented by counsel, time." bono" on himself an expenditure of R (citation omitted). whether in-house or pro does not leave room to agent," non- Second, an attorney is a person who acts as a "legal distinguish between organizations represe