The opinion of the court was delivered by: Robert B. Kugler United States Magistrate Judge
HONORABLE JEROME B. SIMANDLE
KUGLER, United States Magistrate Judge
The Court is confronted here with a situation all too common in today's legal climate. This litigation is no longer a search for the truth to resolve a bona fide dispute between two parties, but has become an acrimonious personal war between the lawyers, characterized by ad hominem attacks and spurious accusations of perjury and unethical conduct. In this war, Defendant's counsel has chosen as his weapon of choice the frivolous motion for sanctions. Counsel's conduct neither serves his client well, nor fosters the "just, speedy, and inexpensive determination of [this action]." Fed. R. Civ. P. 1. The Court will not tolerate such conduct.
Presently before the Court are four related motions. Defendant Cherry Hill Toyota, Inc.'s Motion to Disqualify Plaintiff's Counsel was filed on November 12, 1998. On December 30, 1998, Defendant filed its Motion for Sanctions Pursuant to Fed. R. Civ. P. 37. Plaintiff filed a Motion for Rule 11 Sanctions on January 15, 1999. Finally, on January 25, 1999, Defendant filed its Motion for Rule 11 Sanctions. For the reasons discussed below, all four motions are DENIED.
Additionally, by order dated February 5, 1999, after oral arguments, the Court disposed of one application and three other related motions. In all, between October 29, 1998 and January 25, 1999 the parties have brought before the Court one application and seven related motions. The Court will address the subject matter of the application and all seven motions because many of the motions relate to each other and address identical subject matter, rendering redundant the subject matter of subsequently filed motions.
Finally, the Court, on its own motion, finds that sanctions may be warranted against Defendant's attorney, Jeffrey C. Sotland, for Mr. Sotland's unprofessional conduct in this litigation and his almost complete disregard for the Federal Rules of Civil Procedure and the Local Civil Rules of the United States District Court for the District of New Jersey (the "Local Rules"). Mr. Sotland has fourteen (14) days from the date this opinion and order are filed to submit to the Court in writing the reason or reasons he believes the Court should not impose sanctions on him.
I. Background and Procedural History
In her complaint, Plaintiff Loetta Cannon claims that Defendant violated the federal Truth in Lending Act, 15 U.S.C. § 1601, et seq., by misrepresenting in an installment sales contract for an automobile Plaintiff was purchasing from Defendant the amount of money to be paid to a third-party warranty company. *fn1 Plaintiff also claims that Defendant's conduct violated the New Jersey Consumer Fraud Act, N.J.S.A. 56:8-2, et seq.. Plaintiff brought this action as a putative class action and filed a motion for class certification on June 22, 1998. By opinion and order filed on May 1, 1998, the Honorable Jerome B. Simandle denied Defendant's motion to dismiss counts one and two of the complaint and discovery began in this matter. Judge Simandle has not yet decided the motion for class certification.
The onslaught of recriminations and accusations began on October 29, 1998 when Defendant made a letter application to the Court seeking leave to re-depose Plaintiff. In the application, defense counsel, Jeffrey C. Sotland, claimed that Plaintiff produced two fee agreements pursuant to this Court's September 18, 1998 order to produce her fee agreement with her attorneys. Defendant claims in its letter to the Court that the original fee agreement between Plaintiff and her attorneys prohibited her from settling this case on an individual basis before class certification. The portion of the original fee agreement upon which Defendant based its argument provides, in pertinent part: "If the case is brought as a class action, barring refusal by the court to certify the class, it will not be possible to settle the case on your individual behalf, and any settlement will have to be on a classwide basis." Certification of Jeffrey C. Sotland submitted in Support of Defendant's Motion to Disqualify Plaintiff's Counsel, Exhibit B at ¶ 6. Defendant sought to re-depose Plaintiff to inquire whether a settlement offer that defense counsel made to Plaintiff's counsel was ever communicated to Plaintiff. Defendant further alleged that an amended fee agreement omitted this provision.
Mr. Sotland argued in his October 29 letter that "Defendant would represent that plaintiff's counsel is concerned as to the actions which were taken in this matter and will seek to obstruct Defendant from inquiring into this area at all costs." Mr. Sotland further argued that "[c]onsidering the interest which plaintiff's counsel has in hiding a clear ethical violation, this court is warranted in allowing the deposition to move forward." Taken in the context of the entire letter, this paragraph appears to be a thinly veiled, and awkwardly worded, accusation that Plaintiff's counsel did not communicate Defendant's settlement offer to Plaintiff.
Plaintiff's counsel denied the allegation by letter to the Court dated November 11, 1998.
At oral arguments held on February 4, 1999, Mr. Sotland was unable to articulate any facts whatsoever to support his accusation that Plaintiff's counsel never communicated Defendant's settlement offer to Plaintiff or his reason for disbelieving Plaintiff's counsel's sworn statements to the contrary. Accordingly, by order dated February 5, 1999, the Court denied Defendant's application.
On November 12, 1998, Defendant filed its Motion to Disqualify Plaintiff's Counsel. In its motion, Defendant again alleged, without any factual support, that Plaintiff's counsel did not communicate Defendant's settlement offer to Plaintiff and, therefore, that Plaintiff's counsel should be disqualified from this action. In support of its motion, Defendant filed a "Certification of Counsel," in which Mr. Sotland swore, based on his personal knowledge, that "plaintiff's counsel have violated the Rules of Professional Conduct by removing plaintiff's inherent right to accept settlement." See Certification of Jeffrey C. Sotland at ¶ 6. *fn2 Mr. Sotland further swore, based on his personal knowledge, that "[t]hough plaintiff's counsel rejected the offer, it is believed, based upon the language of the fee agreement, that [the settlement offer] was not communicated to plaintiff since she was incapable of accepting the offer under the terms of the fee agreement." Id. at ¶ 9. Mr. Sotland then concluded, based on his personal knowledge, that "Plaintiff's counsel are incapable of competently handling this litigation since they have proven, by virtue of the initial Fee Agreement, as well as their attempts to hide it with the Amended Fee Agreement, they are incapable of placing plaintiff's interests above their own." Id. at ¶ 10.
Plaintiff opposed the motion and reaffirmed to the Court that Plaintiff's counsel, Lawrence W. Lindsay, communicated Defendant's settlement offer to Plaintiff and that Plaintiff rejected the offer. See Certification of Lawrence W. Lindsay in Opposition to Defendant's Motion to Disqualify at ¶¶ 2-4. In the certification, Mr. Lindsay swore that he himself communicated Defendant's settlement offer to Plaintiff, see id. at ¶ 3, and that he will continue to communicate any offer of settlement to Plaintiff in the future, see id. at ¶ 4. Mr. Lindsay's certification appears actually to have been made on personal knowledge.
On January 6, 1999, Mr. Sotland filed a "Response to Plaintiff's Opposition to Disqualify Counsel." Even though Mr. Scotland carefully characterized these papers as a "Response to Plaintiff's Opposition," it is clear that Defendant actually filed untimely reply papers. Defendant's Motion to Disqualify was returnable on December 18, 1998. See Local Rule 7.1(c)(1). Accordingly, all reply briefs were due on or before December 11, 1998. See Local Rule 7.1(c)(3). Defendant never petitioned the Court for leave to file its reply brief out of time, nor did counsel ever attempt to explain why he was filing a reply almost four weeks late. Accordingly, the Court will disregard the substance of the baseless allegations contained in Defendant's reply papers.
Notwithstanding the fatal procedural defects to Defendant's reply papers, the papers are noteworthy for purposes of this opinion in that they contain a plethora of Mr. Sotland's specious allegations of unethical conduct against Plaintiff's counsel and allegations of perjury against Plaintiff, and are devoid of any factual support for those allegations. For example, in his certification of counsel filed with Defendant's reply papers, Mr. Sotland claims to have personal knowledge that "various information has been obtained which now casts serious doubt on plaintiff's counsel to appropriately litigate this matter." See Supplemental Certification of Counsel in Response to Plaintiff's Opposition to Motion to Disqualify at ¶ 2. Additionally, Mr. Sotland claims to have personal knowledge that "the withholding of relevant information concerning the identity and location of witnesses has been deceptively undertaken by plaintiff's counsel." Id. at ¶ 4.
Mr. Sotland further claims that one of the "witnesses" about whom Plaintiff's counsel is withholding evidence is "Dee Roberts." See id. at ¶¶ 6-10. In support of the allegation that Plaintiff's counsel is now withholding relevant evidence and was withholding relevant evidence at Plaintiff's deposition in August, 1998, Mr. Sotland cites a bankruptcy petition Plaintiff filed in June, 1998 that listed Dee Roberts as a co-debtor and listed Mr. Roberts's address as the same address as Plaintiff. See id. at ¶ 10. Tomar, Simonoff represents Plaintiff in the bankruptcy proceeding as well as in this action. Mr. Sotland then swears that Plaintiff's counsel "knew of the whereabouts of, or at least the means by which to locate, Dee Roberts, yet failed to do so in complete disregard of the Federal Rules of Procedure [sic] and the New Jersey Rules of Professional Conduct." See id. at ¶ 11. Nowhere in his supplemental certification does Mr. Sotland identify the other "witnesses" about whom he alleges Plaintiff's counsel is withholding relevant information.
At oral argument Mr. Sotland was unable to provide the Court with any credible evidence in support of his allegation that Plaintiff's counsel currently knows or ever knew after June 4, 1998 the whereabouts of Dee Roberts.
Additionally, Defendant's "reply" appears to abandon its earlier grounds for seeking the disqualification of Plaintiff's counsel-- counsel's failure to communicate Defendant's settlement offer to Plaintiff--and presents the Court with the entirely new argument that Plaintiff's counsel is somehow in violation of its ethical obligations in this Court because of counsel's alleged failure to communicate Defendant's settlement offer to a bankruptcy trustee in the Eastern District of Pennsylvania. See id. at ¶ 25. Mr. Sotland also swears that he has personal knowledge that Plaintiff's counsel's "reason for not communicating [the settlement offer] to the [b]ankruptcy [t]rustee was for the sole purpose that no fees would be received as a result of this litigation by the plaintiff's law firms." Id. at ¶ 26.
Defendant's reply brief filed with the supplemental certification is similarly filled with unsubstantiated personal attacks on Plaintiff's counsel, and is almost entirely bereft of any relevant legal analysis.
On November 30, 1998, Defendant filed a Motion to Preclude the Testimony of "Dee" and Plaintiff filed opposition papers. At the February 4, 1999 hearing, the Court found that Defendant's motion was without merit and denied the motion. See Order Dated February 5, 1999.
On December 18, 1998, Plaintiff filed a motion to quash a subpoena or for a protective order. The parties informed the Court at the February 4, 1999 hearing that the third-party recipient of the subpoena had responded to the subpoena rendering the motion to quash moot. Accordingly, the Court dismissed the motion to quash as moot on February 5, 1999. See id.
On December 30, 1998, Defendant filed a motion for sanctions pursuant to Fed. R. Civ. P. 37. Mr. Sotland filed another improper certification in support of this motion in which he claimed to have personal knowledge that Plaintiff and her attorneys have deceived Defendant and the Court by withholding the identity and last known address of someone Plaintiff identified as "Dee" at her deposition. See Certification of Jeffrey C. Sotland at ¶¶ 5 and 11. To support this accusation, Mr. Sotland again cites a bankruptcy petition filed by Plaintiff in June, 1998 in which Plaintiff identified Dee Roberts as a co-debtor and stated that Dee Roberts lived at her address. Additionally, Mr. Sotland swears that "Plaintiff has failed to identify this individual by last name, thus precluding defendant from investigating his knowledge concerning this incident." Id. at ¶ 3. Mr. Sotland then swears that "[i]t is believed and therefore averred that plaintiff was living with DEE [sic] at the time [she purchased the car] and was a co-signor of his [sic] vehicle." Id. at ¶ 4 (internal quotations omitted). Mr. Sotland concludes that "Plaintiff's actions and that of her counsel in attempting to deceive the Court and counsel are sanctionable." Id. at ¶ 11.
Plaintiff's opposition points out that Mr. Sotland's assertion that Plaintiff and her counsel have failed to identify "Dee's" last name is disingenuous at best and cites an August 26, 1998 letter in which Mr. Sotland himself states that he "intend[s] to depose Dee Roberts." Additionally, Plaintiff directs the Court's attention to page seven of her August, 1998 deposition in which Ms. Cannon testified that she lived with Dee Roberts at 9601 Ashton Road, see Certification of Lawrence W. Lindsay, Exhibit A, and later testified that Dee accompanied her when she purchased the car from Defendant. See id.
At oral arguments on February 4, 1999, Mr. Sotland was unable to present the Court with any credible evidence to support his allegation that Plaintiff and her counsel knew in August, 1998 and know today the whereabouts of Dee Roberts. At the February 4 hearing, Mr. Sotland made some vague references to some "notes" that he had acquired from a non- party written by an investigator hired by the non-party in which the unnamed investigator allegedly states that Plaintiff knows the whereabouts of Dee Roberts. Mr. Sotland never presented these "notes" to the Court and he stated on the record that he had no firsthand knowledge to support his allegations of perjury against Plaintiff and unethical conduct against her attorneys contained in his sworn certification. Moreover, Mr. Sotland has never presented the Court with any evidence whatsoever to support his allegations that Plaintiff's counsel has somehow mislead the Court or otherwise engaged in some unethical conduct.
On January 14, 1999, Defendant filed a Motion to Compel Certified Answers to Interrogatories and Requests for Admissions. As with his other motions, Mr. Sotland completely disregarded the Local Rules when he filed this motion. First, Mr. Sotland falsely stated in his notice of motion that "the moving party has conferred with the opposing party in order to resolve the issues raised by this Motion, but have [sic] been unsuccessful and cooperation has been withheld." The conference Mr. Sotland apparently is referring to is a January 11, 1999 fax in which he demands certified responses by the close of business on January 12, and threatens that he will file a motion to compel if he does not receive the certifications. See Certification in Opposition to Defendant's Motion to Compel at Exhibit A. The token effort Mr. Sotland made to resolve this issue without intervention of the Court does not satisfy his obligations under Fed R. Civ. P. 37(a) and Local Rule 37.1(a)(1) to confer with his adversary and make a good faith effort to resolve the dispute. Additionally, Mr. Sotland completely ignored his obligation to present this issue before the Court by way of telephone conference or letter to the Magistrate Judge, as required by Local Rule 37.1(a)(1), before bringing a formal motion to compel. Finally, after Plaintiff filed opposition papers, Mr. Sotland filed an impermissible reply to Plaintiff's opposition in violation of Local Rule 37.1(b)(3), which proscribes reply briefs in discovery motions. The certifications Mr. Sotland filed in support of his motion and with his impermissible reply papers contain, what has become his modus operandi, a litany of irrelevant personal attacks on Plaintiff and her counsel. By letter dated January 28, 1999, Mr. Sotland informed the Court that he was withdrawing his motion to compel. The Court dismissed the motion as moot on February 5, 1999. See Order dated February 5, 1999.
On January 25, 1999, Plaintiff filed a motion for sanctions pursuant to Fed. R. Civ. P. 11 claiming that Defendant's motion to disqualify Plaintiff's counsel was frivolous.
Defendant opposed the motion through another improper "Certification of Jeffrey C. Sotland" in which Mr. Sotland almost exclusively relies on the allegations he made in the untimely reply certification filed in Defendant's motion to disqualify Plaintiff's counsel, and in which he appears to abandon the original grounds upon which he sought Plaintiff's counsel's disqualification. As discussed above, the reply certification is a nullity because it was filed out of time without leave of Court and, therefore, the Court will disregard the allegations contained in the certification. In its opposition, Defendant did not even attempt to refute Plaintiff's claim that Defendant's initial moving papers, in which Mr. Sotland alleged that Plaintiff's counsel failed to communicate Defendant's settlement offer to Plaintiff, were frivolous and without support in the law or in the facts of this case.
Finally, on January 25, 1999, Defendant filed an omnibus motion for sanctions combining most of the previous arguments from its other motions and opposition papers into one comprehensive motion. And again, Mr. Sotland filed an improper certification in which he falsely swore that he had personal knowledge that Plaintiff's counsel "rushed to have an Amended Fee Agreement prepared and executed," see Certification of Counsel at ¶ 21, that "Loetta Cannon knew, as did the Law Firm [sic] of Tomar[,] Simonoff[, Adourian, O'Brien, Kaplan, Jacoby & Graziano] of the whereabouts of, or at least the means by which to locate, Dee Roberts," see id. at ¶ 11, and that the reason that Plaintiff's counsel failed to inform a bankruptcy trustee of Defendant's settlement offer "was for the sole purpose that no fees would be received as a result of this litigation by plaintiff's law firms," see id. at ¶ 26, among other things. Of course, Mr. Sotland could not have personal knowledge regarding any of these matters.
Additionally, Mr. Sotland's defective certification contains the usual litany of specious allegations of perjury and unethical conduct, which are wholly unsupported by any credible evidence.
The four motions remaining for disposition are governed by four separate rules of law. Defendant's motion to disqualify Plaintiff's counsel is governed by the Rules of Professional Conduct of the American Bar Association as adopted by the New Jersey Supreme Court ("RPC"). See Local Rule 103.1(a). Defendant's motion for sanctions for Plaintiff's and her counsel's failure to disclose the identity and whereabouts of Dee Roberts is governed by Fed. R. Civ. P. 37. Plaintiff's motion for sanctions for Defendant's failure to withdraw its motion to disqualify Plaintiff's counsel is governed by Fed. R. Civ. P. 11. Defendant's omnibus motion for sanctions filed on January 25, 1999 is governed by this Court's inherent authority to govern the conduct of litigation before it. Accordingly, I will address each motion in turn, and then address the Court's own motion for sanctions against Defendant's counsel.
A. Defendant's Motion to Disqualify Plaintiff's Counsel.
As discussed more fully above, Defendant's motion to disqualify Plaintiff's counsel is premised on Mr. Sotland's unsupported accusation that Plaintiff's counsel never communicated Defendant's settlement offer to Plaintiff and that Plaintiff was prohibited from accepting Defendant's settlement offer by the fee agreement she reached with her attorneys. Defendant argues that counsel's conduct violates RPC 1.2(a) and that RPC 1.16 requires the Court to disqualify Plaintiff's counsel. However, Plaintiff's counsel states that he communicated the settlement offer to Ms. Cannon and that she rejected the offer. Mr. Sotland filed Defendant's reply certification and brief almost four weeks after the deadline to file reply papers in violation of Local Rule 7.1(c). Additionally, Mr. Sotland's certification contains legal and factual argument as well as facts beyond his personal knowledge in violation of Local Rule 7.2(a). Accordingly, the Court will disregard the allegations contained in Defendant's reply papers. Moreover, the reply papers add nothing to the grounds for relief asserted in the original moving papers but, rather, assert entirely new grounds for relief. Finally, the Court's decision regarding Defendant's motion to disqualify Plaintiff's counsel would not have been different even if the Court considered the reply papers that Mr. Sotland belatedly filed.
New Jersey Rule of Professional Conduct 1.2(a) provides, in pertinent part:
(a) A lawyer shall abide by a client's decision concerning the objectives of representation . . . and shall consult with the client as to the means by which they are to be pursued. A lawyer shall abide by a client's decision whether to accept an offer of settlement of a matter.
Defendant seeks the disqualification of Plaintiff's counsel on two grounds. First, Defendant claims that counsel's alleged failure to communicate Defendant's settlement offer to Plaintiff violates RPC 1.2(a). Second, Defendant argue that the language of Plaintiff's original fee agreement with her attorneys violates RPC 1.2(a) by precluding her from settling the case pre-class certification. Neither argument has merit.
Plaintiff's counsel, Lawrence Lindsay, has repeatedly stated, under oath and otherwise, that he communicated Defendant's settlement offer to Plaintiff and that Plaintiff rejected the offer. See, e.g., Certification of Lawrence W. Lindsay filed in opposition to Defendant's Motion to Disqualify at ¶¶ 2-4; Certification of Lawrence W. Lindsay filed in support of Plaintiff's Motion for Sanctions at ¶¶ 2-4; Letter dated November 11, 1998 from Lawrence W. Lindsay submitted to the Court in opposition to Defendant's application to re-depose Plaintiff at 2. At oral arguments on the record on February 4, 1999, Mr. Sotland was unable to present to the Court any evidence whatsoever to support his allegation that Mr. Lindsay did not communicate Defendant's settlement offer to Plaintiff. In fact, Mr. Sotland has never presented the Court with any information beyond the naked allegations in his "certifications" that Mr. Lindsay failed to communicate the settlement offer to his client. Therefore, the Court accepts Mr. Lindsay's word as an officer of the Court and finds that Mr. Lindsay did communicate the settlement offer to Ms. Cannon and that Ms. Cannon rejected the offer. *fn3 Mr. Sotland's allegation to the contrary are without any factual support in the record. Accordingly, Mr. Sotland has failed to provide the Court with any proof whatsoever that Plaintiff's counsel failed to comply with their obligation under RPC 1.2(a) to abide by their client's decision whether to accept a settlement offer. The Court finds, according to the uncontested evidence before it, that Mr. Lindsay communicated the offer to Ms. Cannon and that Ms. Cannon decided to reject the offer.
Defendant also argues that the initial fee agreement between Plaintiff and her attorney violates RPC 1.2(a). The relevant portion of the original fee agreement provides: "If the case is brought as a class action, barring a refusal by the court to certify the class, it will not be possible to settle the case on your individual behalf, and any settlement will have to be on a classwide basis." Certification of Jeffrey C. Sotland filed in support of Defendant's Motion to Disqualify Plaintiff's Counsel, Exhibit B at ¶ 6. The original fee agreement was replaced by an amended fee agreement that Plaintiff signed on September 29, 1998. The amended agreement deletes the settlement provision cited above and replaces it with the following: "Any settlement of the class claims will have to be on a classwide basis, subject to approval by the court, and if the case is certified as a class action, it will not be possible to settle the claims on your individual behalf." Id., Exhibit C at ¶ 4.
Defendant's argument that the fee agreements between Plaintiff and her attorneys violate RPC 1.2(a) and require disqualification of Plaintiff's attorneys is without merit. The original fee agreement is superceded by the amended agreement signed on September 28, 1998. According to the express terms of the amended fee agreement, the "agreement amends the former agreement between the parties and governs the attorney-client relationship between [Ms. Cannon] and Tomar, Simonoff, Adourian, O'Brien, Kaplan, Jacoby & Graziano. . . ." Id. Therefore, the original fee agreement no longer has any bearing whatsoever on counsel's ability to litigate this matter on behalf of ...