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Lax v. City of Atlantic City

United States District Court, D. New Jersey

December 26, 2019

GARY A. LAX, Plaintiff,
v.
CITY OF ATLANTIC CITY; THOMAS MONAHAN, ESQ.; CHRISTOPHER KHATAMI, ESQ.; and GILMORE & MONAHAN, P.A., Defendants.

          CHERYL L. COOPER LAW OFFICES OF CHERYL L. COOPER Attorneys for Plaintiff.

          JESSICA ALI MAIER MCMANIMON, SCOTLAND & BAUMAN, LLC 75 LIVINGSTON AVENUE, SUITE RICHARD D. TRENK MCMANIMON, SCOTLAND & BAUMAN, LLC Attorneys for Defendant City of Atlantic City.

          JENNIFER ANN GUIDEA GORDON REES LLP Attorneys for Defendants Thomas E. Monahan, Esq.; Gilmore & Monahan, P.A.; and Christopher Khatami, Esq.

          OPINION

          NOEL L. HILLMAN, U.S.D.J.

         This action[1] comes before the Court on motions by all parties:

(1) Defendants Thomas E. Monahan, Esq.; Christopher Khatami, Esq.; and Gilmore & Monahan, P.A.'s (the “Gilmore Defendants”) motion to dismiss Plaintiff Gary A. Lax's (“Plaintiff”) complaint (ECF No. 9);
(2) Plaintiff's cross-motion for leave to file an amended complaint (ECF No. 13); and
(3) Defendant City of Atlantic City's (“Atlantic City”) unopposed motion to vacate the Clerk's entry of default (ECF No. 19).

         For the reasons discussed below, this Court will grant the Gilmore Defendants' motion to dismiss; will deny as futile Plaintiff's cross-motion for leave to file an amended complaint; and will deny as moot Atlantic City's motion to vacate the entry of default.[2]

         BACKGROUND

         We take our recitation of the facts from Plaintiff's complaint.

         Plaintiff's action emanates from his involvement in related litigation before this Court, City of Atlantic City v. Zemurray St. Capital, LLC, No. 14-cv-5169 (“Zemurray”).[3] See (ECF No. 1 (“Comp.”) at ¶¶8-15). Plaintiff alleges that the Gilmore Defendants were retained to represent Atlantic City in the Zemurray action and “without doing any due diligence and/or investigation into what involvement, if any, Gary A. Lax had in the allegations that made up the [Zemurray] case[, ]” named Plaintiff as a defendant in that action. (Comp. at ¶¶12-14). As a result, Plaintiff was “forced to retain counsel and defend the baseless allegations made” against him. (Comp. at ¶15). Plaintiff alleges that he was deposed in Zemurray and “there was no information or facts [elicited] linking him in any way to the litigation[.]” (Comp. at ¶20). Nonetheless, the “Gilmore Defendants refused to dismiss Plaintiff from the case[.]” (Comp. at ¶20). According to Plaintiff, in Zemurray, Judge Robert B. Kugler, U.S.D.J. “indicated on-the-record that there was no basis to even name Gary A. Lax as a defendant, and despite” such indications, Defendants “refused to sign a stipulation of dismissal to remove [Plaintiff] from the case.” (Comp. at ¶25). All of this, Plaintiff alleges, caused him harm in various ways.

         DISCUSSION

         I. Subject Matter Jurisdiction

         This Court exercises subject matter jurisdiction pursuant to 28 U.S.C. § 1332.[4]

         II. Legal Standard

         Despite Plaintiff's suggestion otherwise, the present motion to dismiss is governed by the Federal Rules of Civil Procedure, not the New Jersey Rules of Civil Procedure. See Fed. R. Civ. P. 81(c)(1) (explaining that the federal rules of civil procedure “apply to a civil action after it is removed from a state court”).

         When considering a motion to dismiss a complaint for failure to state a claim upon which relief can be granted pursuant to Federal Rule of Civil Procedure 12(b)(6), a court must accept all well-pleaded allegations in the complaint as true and view them in the light most favorable to the plaintiff. Evancho v. Fisher, 423 F.3d 347, 351 (3d Cir. 2005). It is well settled that a pleading is sufficient if it contains “a short and plain statement of the claim showing that the pleader is entitled to relief.” Fed.R.Civ.P. 8(a)(2).

         “While a complaint attacked by a Rule 12(b)(6) motion to dismiss does not need detailed factual allegations, a plaintiff's obligation to provide the ‘grounds' of his ‘entitle[ment] to relief' requires more than labels and conclusions, and a formulaic recitation of the elements of a cause of action will not do . . . .” Bell Atl. Corp. v. Twombly, 550 U.S. 544, 555 (2007) (alteration in original) (citations omitted) (first citing Conley v. Gibson, 355 U.S. 41, 47 (1957); Sanjuan v. Am. Bd. of Psychiatry & Neurology, Inc., 40 F.3d 247, 251 (7th Cir. 1994); and then citing Papasan v. Allain, 478 U.S. 265, 286 (1986)).

To determine the sufficiency of a complaint, a court must take three steps. First, the court must “tak[e] note of the elements a plaintiff must plead to state a claim.” Second, the court should identify allegations that, “because they are no more than conclusions, are not entitled to the assumption of truth.” Third, “whe[n] there are well-pleaded factual allegations, a court should assume their veracity and then determine whether they plausibly give rise to an entitlement for relief.”

Malleus v. George, 641 F.3d 560, 563 (3d Cir. 2011) (alterations in original) (citations omitted) (quoting Ashcroft v. Iqbal, 556 U.S. 662, 664, 675, 679 (2009)).

         A district court, in weighing a motion to dismiss, asks “not whether a plaintiff will ultimately prevail but whether the claimant is entitled to offer evidence to support the claim.” Twombly, 550 U.S. at 563 n.8 (quoting Scheuer v. Rhoades, 416 U.S. 232, 236 (1974)); see also Iqbal, 556 U.S. at 684 (“Our decision in Twombly expounded the pleading standard for ‘all civil actions' . . . .”); Fowler v. UPMC Shadyside, 578 F.3d 203, 210 (3d Cir. 2009) (“Iqbal . . . provides the final nail in the coffin for the ‘no set of facts' standard that applied to federal complaints before Twombly.”). “A motion to dismiss should be granted if the plaintiff is unable to plead ‘enough facts to state a claim to relief that is plausible on its face.'” Malleus, 641 F.3d at 563 (quoting Twombly, 550 U.S. at 570).

         ANALYSIS

         I. The Gilmore Defendants' Motion To Dismiss

         Plaintiff's complaint contains five counts, each of which will be addressed in turn.

         A. Count One: Malicious Use of Process

         Under New Jersey law, a malicious use of process claim requires Plaintiff to plead and prove five elements: (1) a civil action was instituted by this defendant against this plaintiff; (2) the action was motivated by malice; (3) there was an absence of probable cause to prosecute; (4) the action was terminated favorably to the plaintiff; and (5) the plaintiff has suffered a special grievance caused by the institution of the underlying civil claim. LoBiondo v. Schwartz, 970 A.2d 1007, 1022-23 ...


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