The opinion of the court was delivered by: Stephen M. Orlofsky United States District Judge
In what has unfortunately become a far too frequent occurrence in this era of "scorched-earth" litigation tactics, an errant attorney has lost sight of his professional obligations to his client, his profession, and this Court. What began in this Court as a relatively straightforward patent infringement dispute between two rain gutter manufacturers has now mushroomed into a separate, purported civil rights action brought by the attorney representing the plaintiff against the attorney representing the defendants in the patent dispute. The defendants in the patent action, represented by Norman E. Lehrer, Esq., alleged counterclaims against, among others, counsel for the plaintiffs, Charles L. Thomason, Esq. As a result of the counterclaims, Thomason and his firm were compelled to withdraw as plaintiff's counsel in the patent action. Instead of challenging the propriety of the factual allegations made by the patent case defendants in their counterclaims, either on their merits or through the mechanism of a motion for sanctions under Rule 11 of the Federal Rules of Civil Procedure, Thomason instead chose to file a separate civil rights action against Lehrer and Lehrer's professional corporation in state court. After removal of the state court action to this Court, Thomason amended his complaint to allege again that Lehrer "committed [an] abuse of process under color of statute and state laws" merely because Lehrer, on behalf of his clients, had alleged and served counterclaims upon Thomason.
On its own motion and pursuant to Rule 11(c)(1)(B) of the Federal Rules of Civil Procedure, the Court entered an Order to Show Cause, the details of which are discussed below. After careful consideration, I find Thomason's conduct in this case to be intolerable and unprofessional. His actions were motivated by meanspiritedness and petulance, and driven by his ego, rather than his client's interests. Based upon the undisputed facts of record before me, I conclude that the frivolous civil rights action filed by Thomason in state court and then prosecuted in this Court was initiated solely to harass and retaliate against Lehrer.
Because Thomason has interposed claims in the purported civil rights suit which were presented for an improper purpose and were not warranted by existing law or by a non-frivolous argument for a change in law, I will impose sanctions against Thomason under Rule 11(b)(1-2) of the Federal Rules of Civil Procedure. I will fine Thomason $2,000, $1,000 to be paid directly to Lehrer and $1,000 to be deposited into the Court's Registry pursuant to Local Civil Rule 67.1. The fine shall be paid to Lehrer and the Clerk of the Court within thirty days of the date of this Opinion. I will also require Thomason to attend and complete continuing legal education ("CLE") courses in federal practice and procedure and on attorney professionalism and professional conduct. Thomason shall attend and complete the two CLE courses within eighteen months of the date of this Opinion. Upon completion of the CLE courses, Thomason shall file an affidavit with the Court attesting to his attendance at and satisfactory completion of each course.
Turning to the merits of Thomason's claims, I will dismiss Count I of the Second Amended Complaint for failure to state a claim upon which relief can be granted, and will order Thomason to show cause as to why the remaining state law counts alleged in the Second Amended Complaint should not be dismissed pursuant to the litigation privilege recognized under New Jersey law.
I have reached the decision to impose Rule 11 sanctions in this case only after careful deliberation. I do so with great reluctance, mindful of the duty of an attorney to represent his or her client's interest zealously. The circumstances of this case, however, present the unhappy picture of a lawyer who has crossed the boundary of legitimate advocacy into personal recrimination against his adversary. Lawyers are not free, like loose cannons, to fire at will upon any target of opportunity which appears on the legal landscape. The practice of law is not and cannot be a "free fire zone." While I will impose these sanctions pursuant to the authority conferred upon me by Rule 11, I join with those who urge the legal profession to return to the standards of professionalism which have characterized the bar throughout the history of our nation. See, e.g., ABA Journal, What it Takes to be a Professional 48-73 (Aug. 1998); American Bar Association, Promoting Professionalism (1997).
I. Facts and Procedural History
The facts giving rise to this lawsuit are not generally in dispute. A full understanding of the conduct involved requires a description of the underlying patent infringement case, Waterloov Gutter Protection Systems Co., Inc. v. Absolute Gutter Protection, L.L.C., et al., Civil Action No. 97-2554 (SMO). On May 16, 1997, Waterloov Gutter Protection Systems Co., Inc. ("Waterloov"), then represented by Plaintiff, Charles L. Thomason, Esq. ("Thomason"), filed a Complaint in this Court alleging patent infringement by Absolute Gutter Protection, L.L.C. ("Absolute") and Charles Knight ("Knight"). See Complaint (dated May 15, 1997). Absolute and Knight were represented by Defendants, Norman E. Lehrer, Esq., and his firm, Norman E. Lehrer, P.C. (collectively, "Lehrer").
Shortly thereafter, the Court denied Waterloov's application for a preliminary injunction, and its motion for reargument of the denial of the application. See Opinion & Order (dated June 11, 1997); Opinion & Order (dated July 18, 1997). The denial of the preliminary injunction was affirmed on appeal by the United States Court of Appeals for the Federal Circuit on April 3, 1998. See Waterloov Gutter Protection Sys., Co. Inc. v. Absolute Gutter Protection, L.L.C., et al., Case No. 97- 1497, Judgment (dated Apr. 3, 1998).
On July 16, 1997, Waterloov, still represented by Thomason, filed an Amended Complaint. See Amended Complaint (dated July 15, 1997) (hereinafter Amended Complaint or Amended Compl.). The Amended Complaint added several new defendants to the action, William Gumpper, Gumpper's Gutter Service, Ray Vandergrift, and Nelson Sensenig, doing business as Sensenig Spouting and White Oak Manufacturing, L.L.C. Id. at ¶¶ 2-6. These new Defendants are also currently represented by Lehrer.
In response to Waterloov's Amended Complaint, Absolute and Knight filed an Answer, Affirmative Defenses, and Counterclaims. In that pleading, Absolute and Knight asserted claims against Waterloov, Richard L. Kuhns ("Kuhns"), Thomason, Raymond R. Moser, Jr. ("Moser"), Emon J. Wall ("Wall"), and the law firm of Thomason & Moser. See Answer, Affirmative Defenses, and Counterclaims (dated July 29, 1997) (hereinafter Answer & Counterclaims). Kuhns is Waterloov's President. Moser is Thomason's law partner in the law firm of Thomason & Moser, and Wall is an associate at the firm.
On November 3, 1997, the Court held that, despite the pending appeal of the denial of the preliminary injunction, it had jurisdiction to consider Waterloov's motion to sever and dismiss certain of the claims alleged by Absolute and Knight in their Answer. See Opinion & Order (dated Nov. 3, 1997). On March 31, 1998, I dismissed without prejudice three of the claims asserted by Absolute and Knight in their Answer. Among the claims by Absolute and Knight which remained was one against Thomason, Moser, Wall, and/or Thomason & Moser. See id. at 8-9. Several days after the dismissal, Absolute and Knight amended their Answer and purportedly reasserted the counterclaims which had been dismissed. Some of the claims which were realleged contained allegations against Thomason. See First Amended Answer, Affirmative Defenses and Counterclaims ¶¶ 96, 98, 104 (dated Apr. 3, 1998).
On April 22, 1998, Waterloov, still represented by Thomason, answered the counterclaims asserted against it in Absolute and Knight's First Amended Answer. Waterloov did not, however, answer Absolute and Knight's counterclaims which the Court had dismissed, but which were purportedly realleged in the First Amended Answer. See Waterloov's Answer to Counterclaims at p.4 (dated Apr. 22, 1988). Similarly, in answering Absolute and Knight's counterclaims, Thomason, Moser, Wall, and Thomason & Moser, then represented by new counsel, averred that the purportedly realleged claims had not been properly interposed. See Thomason, Moser, Wall, and Thomason & Moser's Answer to Counterclaims ¶ 5 (dated Apr. 24, 1998). Kuhns did not file an answer to Absolute and Knight's counterclaims and a default was entered against him on April 28, 1998. That default was subsequently set aside on July 14, 1998. See Memorandum Opinion (dated July 14, 1998). On May 20, 1998, the Honorable Robert B. Kugler, United States Magistrate Judge, granted Thomason's motion to withdraw as counsel for Waterloov. See Letter Opinion (dated May 20, 1998).
On or about March 4, 1998, in the midst of the Waterloov litigation and before he was forced to withdraw as Waterloov's counsel, Thomason filed this civil rights action in the Superior Court of New Jersey, County of Monmouth, Law Division, naming as Defendants, Lehrer and Lehrer's professional corporation. See Charles L. Thomason v. Norman E. Lehrer, P.C., et al., Docket No. Mon-L-1165-98, Complaint (dated Mar. 4, 1998).
The Complaint alleges three causes of action. Count I alleges abuse of process. In Count I, Thomason contends that Lehrer "did maliciously commit an abuse of process upon [Thomason] by filing a [c]ounterclaim that named [Thomason] as a party to the suit and serving a Summons upon [Thomason] in Monmouth County." Id. at ¶ 4. Thomason further alleges that "Lehrer committed the aforesaid abuse of process under color of statute and state laws," id. at ¶ 5, and that "Lehrer . . . subjected [Thomason] . . . to the deprivation of rights, privileges or immunities secured by the Constitution and laws," id. at ¶ 6. Thomason also alleges that "Lehrer made allegations that were not based on facts, and were not based on a reasonable inquiry as to the facts," that "Lehrer made allegations which served to needlessly increase the cost of litigation," and that "Lehrer committed a willful act in the use of process which was intended by Lehrer to prevent the regular conduct of the proceeding and to accomplish an improper purpose." See id. at ¶¶ 7- 10. Additionally, Thomason alleges that "Lehrer used means that had no substantial purpose other than to embarrass, delay or burden [Thomason], which is violative of [New Jersey Rule of Professional Conduct] 4.4 that governs conduct by attorneys." Id. at ¶ 11. Thomason demands judgment under 42 U.S.C. § 1983. See id. at p.3.
Count II of Thomason's Complaint alleges negligent misrepresentation. See id. at ¶¶ 19-26. Count III alleges tortious interference. See id. at ¶¶ 29-33. In particular, Thomason contends that "at the time [Lehrer] committed abuse of process and negligently made misrepresentations, [Thomason] had a reasonable expectation of prospective work and fee income from acting as attorney in the Waterloov suit." Id. at ¶ 29. Thomason further alleges that "Lehrer was aware of [Thomason's] expectation, and [Lehrer] knew that prospective work would be interfered with or lost by [Lehrer's] abuse of process, and by [Lehrer's] negligent misrepresentation." Id. at ¶ 30.
On April 21, 1998, Thomason amended the Complaint filed in the Superior Court of New Jersey. See Charles L. Thomason v. Norman E. Lehrer, P.C., et al., Mon-L-1165-98, Amended Complaint (dated Apr. 21, 1998). Essentially realleging those claims which had been presented in the original Complaint, Thomason added allegations that: Counts VII, VIII and IX of the Counterclaim [sic] signed by [Lehrer] made allegations ...