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The successful practice of law requires creative thinking, especially in litigation where the stakes are high. Developing goals early on in litigation and mapping out strategies to achieve those goals is critical to achieving a successful outcome.
As experienced practitioners with more than 40 years of collective experience in handling complex commercial litigation matters, our attorneys don’t flip off the light switch when we leave the office. Frequently, we find ourselves thinking about our clients’ cases when we’re outside of the office – whether it be driving in a car to/from the office, or canvassing newly published and unpublished decisions issued by trial and appellate courts that may impact current cases we are handling. It is this type of dedication that our New Jersey law firm offers to businesses and individuals confronted with litigation.
Sometimes, the best ideas on how to handle a particular case do not come from something we read in a rule book or other legal publication, but rather come from our in-depth knowledge in many different areas of the law and our experience from working on prior cases. Here is a sampling of cases that we successfully resolved by developing and implementing creative strategies. Information is based on public record filings in the respective courts. *
UAB Pamario Dvaras v. DKP Wood Railings & Stairs, Inc., et al., United States District Court, District of New Jersey, Civil Case No.: 14-04495
In this hotly contested case our firm served as local counsel to a small business owner and his company wrongfully accused by a disgruntled foreign-based overland trucking company and its former shareholder of operating a black market auto ring involving multiple shipments of used luxury cars to Lithuania. A Lithuanian court applying foreign transportation laws and treaties held the trucking company was liable to the purchasers of several cars that were damaged during overland transport to Belarus, and entered judgment against the trucking company and its subcontractor for the equivalent of approximately $41,000 U.S. Dollars.
Evidence that the Lithuania court considered in rendering a judgment in favor of the vehicle purchasers included a letter authored by our client attesting to the identity of the purchasers and confirming the details of the transaction. After exhausting its appellate rights in Lithuania to no avail, the trucking company brought suit against our clients in the United States District Court for the District of New Jersey, claiming the letter our client submitted to the Lithuania court was false and caused the Lithuania court to enter a false judgment. The plaintiffs further accused our client of deliberately under-insuring the vehicles. The plaintiffs’ federal court complaint asserted causes of action under the Racketeer Influenced Corrupt Organizations Act (RICO), New Jersey Consumer Fraud Act, contribution and indemnity, and fraud. Incredibly, plaintiffs claimed this relatively small judgment entered by the Lithuanian court caused their company’s financial demise culminating with its corporate bankruptcy filing in Lithuania.
Cases are often won and lost by themes developed and promoted from the outset. In this particular instance the plaintiffs were attempting to use the United States federal court system as an international appellate court to escape the unfavorable rulings by the Lithuanian courts. Further, pretrial discovery revealed that the individual plaintiff was not a shareholder of the corporate plaintiff at the time the federal court complaint was filed, and that a foreign bankruptcy administrator was appointed to marshal the assets and claims of the corporate plaintiff which had filed a liquidation bankruptcy. Thus, the plaintiffs did not possess the legal rights to be pursuing claims against our clients. In addition, we believed that the federal court did not possess subject matter jurisdiction over the case.
A key component to developing our themes was hiring a Lithuanian attorney to serve as an expert witness to opine on applicable Lithuanian laws and that country’s court system, and to obtain and verify foreign court documents. We persuaded the District Court to allow us to retain such an expert for the purpose of aiding the Court in pretrial motion practice.
With the aid of a foreign law expert we successfully secured a dismissal of the entire case by motion. The District Court judge agreed with every one of our legal arguments, and chastised the plaintiffs’ lawyer for filing a complaint predicated on false allegations. Click here to read our opening brief. Click here for the District Court’s Order of dismissal
KL Palisades, LLC, United States Bankruptcy Court, District of New Jersey, Civil Case No.: 15-32649-SLM
In this case we represented a successful foreclosure bidder in a Chapter 11 bankruptcy case involving a multi-million dollar commercial property in Palisades Park, New Jersey. Our client purchased the property for $6.4 million at a judicial sale conducted by the Bergen County Sheriff, representing a substantial discount from its approximate $8 million dollar fair market value.
Exactly 10 days after the Sheriff’s sale, the property owner, a corporation in Chapter 11 reorganization, attempted to exercise its state law redemption rights under false pretenses by presenting approximately $6.5 million in certified funds to the Bergen County Sheriff. The Sheriff accepted the funds, and took the position that the debtor had rightfully exercised its redemption rights. The bidder retained our firm to protect its rights.
Did the Chapter 11 debtor obtain the Bankruptcy Court’s approval to borrow the $6.5 million? A debtor-in-possession in a Chapter 11 case has certain fiduciary obligations, one of which requires Bankruptcy Court approval to borrow money outside the ordinary course of its business. So our first task was to review the Bankruptcy Court’s online case file to determine if this corporate debtor obtained the requisite Bankruptcy Court approval to borrow the $6.5 million. Incredibly the debtor had not! In addition, the Court’s case docket also reflected the debtor’s earlier failed attempt to sell the property to the son of the debtor’s sole shareholder and principal officer.
Now the next question: Would the state foreclosure court entertain a challenge to the debtor’s redemption based on the debtor’s non-compliance with federal bankruptcy law, and if so would we succeed?
It seemed likely that the debtor obtained the $6.5 million loan as part of a side deal to sell the property to the son of the debtor’s principal, even though the debtor’s prior attempt to do so had failed. We determined that the best strategy was to attack the debtor’s actions by making application to the United States Bankruptcy Court for relief from the automatic stay. Under federal bankruptcy law the automatic stay prevents most civil actions from continuing, including foreclosure actions to recover property belonging to a debtor in Chapter 11. This particular debtor still held a possessory interest in the property, so pursuing relief from the automatic stay was necessary and appropriate.
We focused our motion papers on the argument that the debtor had acted inappropriately under federal bankruptcy law in obtaining a $6.5 million dollar loan without informing the Bankruptcy Court or its creditors. We further argued that this loan was a back door attempt to sell the property to the son of the debtor’s principal. If we succeeded in obtaining stay relief (i.e., the equivalent of a ruling rejecting the debtor’s unauthorized loan borrowing) then we believed we could leverage that ruling later on in the foreclosure court when challenging the debtor’s purported exercise of its state law redemption rights. The strategy was not without risk though, because the Bankruptcy Court has the discretion to fashion a remedy that is in the best interests of the debtor and its creditors, including the bank that held the mortgage on this property and which stood to be paid in full by the debtor’s $6.5 million dollar payment to the Bergen County Sheriff. In other words, the Bankruptcy Court could still award the property to the debtor if the judge believed the equities tipped the scales of justice in the debtor’s favor.
After a contested hearing, the Bankruptcy Court expressly rejected the unauthorized $6.5 million loan transaction and granted our client relief from the automatic stay of the Bankruptcy Code to complete the foreclosure sale.
Thereafter, over the property owner’s objection, the Superior Court of New Jersey confirmed the sale and directed the Bergen County Sheriff to issue the property deed to our client.
Our strategy worked! Our client was able to leverage the Bankruptcy Court’s ruling to persuade the state court to likewise reject the debtor’s attempted redemption.
This was a lawsuit initiated by our client’s disgruntled ex-boyfriend to recover his ownership interest in a multi-family home in Hudson County that he voluntarily sold to our client during the course of their long-standing relationship. The parties entered into a written contract back in 2006 requiring our client to pay the sum of $25,000 over the course of a 4-year monthly installment schedule. A deed was prepared and recorded in our client’s name in 2007 thus establishing her as the sole owner of the property. Shortly thereafter, our client added her children to the property by executing and recording a second deed. The parties continued living in the house together.
The parties relationship soured in 2010 prompting the ex-boyfriend to move out of the house. The ex-boyfriend also incurred financial problems and filed for Chapter 7 bankruptcy protection in July 2011; at that time a handful of monthly contract payments remained to be paid by our client to complete her 2006 contract purchase. In completing his bankruptcy petition the ex-boyfriend did not disclose owning an interest in any real estate or that he had any claims against anyone. Further, the ex-boyfriend did not disclose to the bankruptcy court the remaining contract payments that our client owed to him. When questioned by his bankruptcy trustee under oath, the ex-boyfriend affirmatively disclaimed possessing any claims against anyone. Meanwhile, our client continued making all of the post-petition contract payments and paid off the obligation in its entirety.
Notwithstanding, following his bankruptcy discharge the ex-boyfriend sued our client claiming she had defrauded him out of his ownership interest in the multi-family dwelling. After reviewing the bankruptcy court’s file and obtaining the audio-tape of the ex-boyfriend’s testimony before the bankruptcy trustee we determined that the best course of action would be to file a motion to dismiss the state court case on the grounds that the omitted claims belonged to the ex-boyfriend’s bankruptcy estate. We proceeded to file the motion which prompted the ex-boyfriend to file a motion to reopen his bankruptcy case. The state court agreed and dismissed the case without prejudice on October 10, 2014 due to the ex-boyfriend’s lack of legal standing to pursue the claims; the dismissal was subject to the outcome of the bankruptcy court’s disposition of the debtor’s motion to reopen that case.
The bankruptcy court did grant the ex-boyfriend’s motion to reopen his bankruptcy case so that a Chapter 7 trustee could evaluate the omitted claims and determine whether to pursue them in bankruptcy court. However, the bankruptcy trustee determined that the claims were not worth pursuing and proceeded to file a no-asset report. The bankruptcy court then closed the case for a second time in November 2015. Critically, the ex-boyfriend never amended his bankruptcy petition to disclose the omitted claims and therefore the claims remained part of his bankruptcy estate.
About 17 months later, in January 2017, the ex-boyfriend petitioned the Superior Court of New Jersey to reinstate his Complaint by falsely claiming that the bankruptcy trustee had “abandoned” the claims. The state court denied the motion on the basis that the ex-boyfriend did not meet his burden of proof to demonstrate that the claims were abandoned, and said the claims would remain dismissed “without prejudice” unless the ex-boyfriend could secure the bankruptcy court’s confirmation of the abandonment.
In July 2017 the ex-boyfriend filed a motion to reopen his bankruptcy case for a second time and sought permission to amend his bankruptcy petition to finally disclose the omitted claims. We vigorously opposed the motion on behalf of our client, arguing that there was no valid reason to reopen the case so as to bail the ex-boyfriend out of his own fraud. The bankruptcy judge agreed and denied the debtor’s motion “with prejudice”, meaning that the omitted claims would forever be a part of his bankruptcy estate. Critically, the bankruptcy judge determined that the ex-boyfriend was “playing games”.
Armed with the bankruptcy court’s ruling we then successfully petitioned the state court to dismiss the ex-boyfriend’s complaint “with prejudice”, thus bringing an end to the ex-boyfriend’s frivolous lawsuit.
In this professional ethics grievance, partner Glenn R. Reiser successfully defended an experienced real estate attorney charged with knowingly and deliberately falsifying a real estate closing statement in violation of RPC 8.4(c), and lying to the Office of Attorney Ethics and other third parties in violation of RPC 4.1 and RPC 8.1.
The grievance was filed by a real estate broker who accused our client of unilaterally reducing her company’s brokerage commission on the morning of the closing in a transaction where the brokerage firm was acting as the dual agent such that they would receive 100% of the commission. Our client maintained that on the morning of the closing a verbal agreement was reached between the broker and his client, the buyer, to use a portion of the broker’s fee (approximately $1,800) towards his closing costs provided that the buyer repaid the shortfall after the closing. The transaction closed, but the HUD-1 statement prepared by the title company was not changed to reflect the reduction of the broker’s fee. Our client signed the HUD-1 as an agent for the title company which was acting as the settlement agent and had prepared the document. The title company maintained all contact with the lender and disbursed all checks at the closing.
When the buyer didn’t pay the fee back fast enough, the realtor accused our client of masterminding a scheme to steal her broker’s fee and inappropriately resorted to using the NJ attorney ethics process as a forum to collect the balance of her company’s fee. Within several months of filing the grievance the purchaser paid the realtor the balance of the fee.
Unfortunately, the Office of Attorney Ethics took a very draconian and narrow-minded approach to this grievance – essentially advocating a strict liability theory that the HUD-1 was inaccurate and therefore our client intentionally signed a false document. Notwithstanding the buyer having informed the Office of Attorney Ethics about the verbal agreement during their internal investigation, the Office of Attorney Ethics chose to believe the broker’s concocted story and proceeded to file a Complaint accusing our client of engaging in serious misconduct that merited the appointment of a Special Master.
Inexplicably, the Office of Attorney Ethics also accused our client of lying to an ethics authority and to other third persons simply because when responding to the grievance he represented that the parties had reached a verbal agreement on the morning of the closing – the same statement given by the purchaser during his pretrial interview with the Office of Attorney Ethics!
Our strategy at the outset was to attack the realtor’s credibility and portray the grievance as the equivalent of malicious prosecution. The grievant was present at the walk through inspection on the afternoon of the closing and received a check which noted the reduction of the brokerage fee in the memo portion, but never once complained directly to our client about any problem with the fee, and her company cashed the check without protest. On the other hand, the broker threatened the purchaser with civil and criminal charges if he didn’t pay the fee back – sending him several nasty emails and hounding him with cell phone calls.
Further, the broker denied ever speaking to the purchaser about any commission reduction on the morning of the closing. We directed the issuance of a subpoena to her cell phone carrier, and the records proved that she had spoken with the purchaser at critical times during the morning and afternoon of the closing. This evidence contradicted her earlier testimony given to the Office of Attorney Ethics, and enabled us to destroy her credibility during cross-examination at trial. In addition, the purchaser’s testimony at trial corroborated our client’s testimony that the realtor had agreed to a verbal commission adjustment on the morning of the closing.
Further, we destroyed the credibility of the realtor’s office manager who, on cross-examination, proffered three different versions of when his company received the check and he first realized there was a shortage with the fee: (1) initially denying having received the check at the closing; (2) claiming he received it in the mail a few days after the closing – that being the first time he became aware of the fee reduction; (3) but finally conceding that the check was handed to him at the closing at which point he knew the check was for a lesser amount.
Our client was cleared of all charges following a 9-day trial conducted before a Special Master. Click here to read a more in-depth discussion about this ethics grievance.
Monroe vs. Sutton, Superior Court of New Jersey, Law Division, Monmouth County, Docket No.: MON-L-1103-14
In this case we represented the purchasers in an action against the sellers in a failed residential real estate transaction to recover the purchasers’ contract deposit. The parties were unable to reach an agreement on home repairs. The purchasers terminated the contract during the home inspection contingency period, but the sellers sellers refused to refund their deposit. Our clients filed suit for breach of contract in the Superior Court of New Jersey in Monmouth County.
Very early in the case our firm served an offer of judgment on the defendants proposing to accept 20% less than the disputed deposit. An offer of judgment is a procedure available under New Jersey Court Rules that is encouraged to foster settlement of litigation, and also serves as a fee shifting mechanism. (Under the American Rule, each party is responsible for paying their own legal fees absent a statute, rule or contractual provision that provides for an award of legal fees to the prevailing party. The Offer of Judgment procedure embodied in New Jersey Court Rule 4:58-1 is one such exception to the American Rule.) Under the Offer of Judgment Rule, either party to a lawsuit can propose to accept a judgment for a specific dollar amount. If the offer is rejected and the party submitting the offer recovers a judgment for 120% of the amount offered then the prevailing party is entitled to recover their legal fees.
In this case if the defendants had accepted the offer of judgment our clients would have walked away with 20% less than their contract deposit, but they would have been spared the expense of litigating the case. However, the defendants rejected the offer of judgment.
Following pretrial discovery our clients prevailed on summary judgment obtaining the return of their entire contract deposit, the Court concluding that the defendants had breached the contract. Thereafter, our firm prepared and filed a motion to recover our client’s legal fees predicated on the rejected offer of judgment. As a result of adopting this strategy early on, we preserved our clients ability to recoup their litigation expenses. Ultimately, the defendants agreed to reimburse our clients for $55,000 which we secured as a lien against the New Jersey property. Defendants paid the judgment in full.
Royal Tax Lien Services vs. Arik, Superior Court of New Jersey, Chancery Division, Bergen County, Docket No.: F-7409-11
In this case our clients, a father and son, lost their home as a result of an unpaid real estate tax lien that was foreclosed by a tax lien purchaser. My clients claimed they had no knowledge of the lawsuit, and were completely shocked when sheriff’s officers appeared at their home with moving trucks to evict them. Unlike a regular mortgage foreclosure case, in tax foreclosure cases title passes to the plaintiff upon the entry of a judgment. Thus, our clients no longer owned the home and were subject to eviction.
After meeting with the clients, we determined that there was a basis to overturn the foreclosure judgment because of defective service of legal process. While the father lived at the house, the son did not. Plaintiff’s process server assumed the son lived at the home, and thus left the summons and complaint with the son’s brother. No effort was made to verify whether the son actually lived at this house, and the son actually owned another home in the same town. The son never received any other notices from the plaintiff’s attorney that were sent to the house, and thus missed out on the many opportunities that were available to rescue the home. Complicating the matter further, the father did not speak or read English.
We immediately prepared and filed an order to show cause to vacate the foreclosure judgment on the basis of lack of due process, and requesting a preliminary injunction prohibiting the plaintiff tax investor from selling the property pending further order of the Court. Due to the quality of our legal papers, the plaintiff agreed to the temporary restraints and ultimately consented to allow our clients to redeem the property by paying the full amount of the unpaid tax lien, plus legal fees and interest. We saved the family’s home without ever appearing in the Courtroom!
Click here to read the brief that we filed in support of the order to show cause.
Click here to download the order vacating judgment and permitting redemption of the tax sale certificate.
EZ High Tech, Inc. vs. Benchmark Financial Group, et al., Superior Court of New Jersey, Law Division, Union County, Docket No.: UNN-L-896-13
In this case our client, a leasing company located in California, was sued in New Jersey by one of its customers alleging breach of contract and fraud. Upon obtaining and reviewing the file, we observed that the underlying lease contract contained a forum selection clause requiring that all disputes between the parties be brought and decided in Orange, County, California. After the plaintiff refused to voluntarily dismiss the case, in lieu of filing answer the Complaint our law firm filed a motion to dismiss the Complaint based on the forum selection clause.
The Court granted the motion (order dismissing case), and then denied plaintiff’s motion for reconsideration. By adopting an aggressive approach right out of the gate, we successfully dismissed the plaintiff’s lawsuit.
Mladenovic vs. Nebcom, Inc., United States District Court, District of New Jersey, Case No.: 2:12-cv-07019-DMC – MF
In this case, the defendant hired our firm to defend a lawsuit filed in federal court. After reviewing the information provided by our client, we informed our client of our belief that the lawsuit was frivolous and should be dismissed. Instead of filing a formal motion to dismiss the case, we recommended a less costly approach of issuing a letter notifying plaintiff’s counsel that we would pursue frivolous litigation sanctions unless his client voluntarily dismissed the complaint without the necessity of our filing a motion.
Under the threat of sanctions, plaintiff voluntarily dismissed the case on March 21, 2013 thus saving our client thousands of dollars in legal fees. Click here to download the order of dismissal.
Liggero Architecture, LLC vs. McGuire, United States Bankruptcy Court, District of New Jersey, Adv. Pro. No.: 09-2666
In this case we represented an architect and his company as unsecured creditors in a Chapter 7 bankruptcy case. Prior to the bankruptcy, our clients had obtained a default judgment against the bankrupt individual and others in excess of $200,000 resulting from a failed real estate investment. Our clients invested $200,000 with the bankrupt debtor to develop a parcel of property in New Jersey, and believed the debtor and her brother had misappropriated their money to purchase stock in IBM instead of using it for the property.
The client retained our law firm to file an adversary proceeding objecting to the discharge of their judgment debt, imposing a constructive trust over the debtor’s IBM stock holdings, and seeking to trump the Chapter 7 Trustee’s claim to this asset.
After we filed the adversary proceeding, the Chapter 7 trustee approached our firm about purchasing whatever claims he could assert against the IBM stock. Believing a settlement with the trustee was in our clients’ best interests and would minimize litigation costs by avoiding a hotly contested battle with the Chapter 7 trustee, we recommended that our clients purchase the trustee’s rights and claims to the IBM stock. Our clients agreed with our recommendation, and entered into a settlement with the trustee providing for the payment of $15,000. As a result of this settlement, our client now stood in the shoes of the bankruptcy trustee armed with the special avoidance powers and other remedies only available to bankruptcy trustees.
During the course of the litigation, the debtor denied having ownership of the IBM stock at the time she filed her bankruptcy petition, claiming she transferred the stock to her brother as repayment for various loans he allegedly gave to her over the years. However, in pretrial discovery we learned that the debtor had listed IBM stock dividends on her federal income tax returns. Documents recovered from a subpoena issued to IBM’s stock transfer agent confirmed that the debtor owned several hundred shares of IBM stock in electronic form, and owned additional IBM shares in certificate form.
After fending off challenges to the settlement raised by the debtor’s brother, and under the threat of civil and criminal contempt proceedings against the debtor and her brother where we accused them of willfully violating the bankruptcy court’s Order that prohibited transfer of the IBM shares, we ultimately recovered in excess of $140,000 for our clients. As a result of this settlement, our clients were the only creditors in the case who were paid.
Avis Rent A Car vs. Calvo, Superior Court of New Jersey, Law Division, Middlesex County, Docket No.: MID-L-8068-11
In this case, our client was sued by Avis for property damage sustained to 3 vans which she rented from a New Jersey location. In total, Avis was seeking to recover approximately $50,000 from the defendant.
Our client purchased additional insurance from Avis that was supposed to cover her and additional drivers for accidents. According to Avis’ internal records our client was considered a “preferred customer.” In reliance upon Avis’ representations that she would receive “bumper to bumper” coverage for any accidents or damage, our client proceeded to rent 11 vans from Avis and paid an additional $39.95 per day for the additional insurance coverage.
Avis disclaimed coverage based on an insurance exclusion, claiming she used the vehicles “for hire” as part of her limousine business. Our client denied the allegation, claiming that she had rented from the same Avis location before and that Avis knew she operated a limousine business. After all, the average renter does not rent 11 vehicles!
As a small business owner, the defendant had a limited legal budget to defend the case and was reluctant to go to trial. Yet, by the same token she didn’t believe she was responsible to pay Avis because of the extra insurance coverage that she purchased for this very purpose.
After meeting with the client and reviewing the Avis rental contract and other documents, we determined that she had a viable counterclaim against Avis for violating the New Jersey Consumer Fraud Act which prohibits unconscionable commercial practices. We informed defendant that asserting an affirmative counterclaim against Avis and demanding a jury trial would let Avis know that she meant business, and might discourage Avis from going to trial – which was her goal. Our client agreed, but asked us to keep legal fees to a minimum.
As the trial date approached, we informed our client of the need to prepare and file a trial brief – that we couldn’t expect to win the case simply by showing up at the trial without having briefed the law in defense of Avis’ claims against her and in support of her Consumer Fraud Act counterclaim. Further, we reiterated that filing a detailed trial brief would send another message to Avis – that she wasn’t backing down and was fully prepared to go to trial.
The strategy was successful. Within several weeks after we filed our trial brief Avis agreed to voluntarily dismiss its claims against our client in return for our client dismissing her claims against Avis. The end result is we won the case for our client without ever entering the courtroom.
Norville, SA vs. Cumins Machinery Corp., Superior Court of New Jersey, Law Division, Passaic County, Docket No.: PAS-L-3776-02
In this case, we represented an Argentinian businessman who claimed a Paterson, NJ company owed him $40,000 for heavy industrial machinery that was purchased but not paid for. The defendant denied the claim, arguing that the machinery was delivered on consignment and offering to give the machines back to my client if he paid the cost and insurance for freight shipping to Argentina. Our client’s primary goal was to recover a meaningful settlement from the defendant, and avoid the cost and time commitment required in traveling from Argentina to New Jersey to attend a trial.
The parties primarily communicated through emails, which in 2002 was not as prevalent as it is today. In any event, the documents exchanged in pretrial discovery created at least the impression that there was some consignment arrangement that had existed between the parties, but our client insisted that these particular machines were not part of the consignment but rather were purchased outright.
Partner Glenn R. Reiser took the deposition of the defendant’s principal under oath. During the course of the deposition, it occurred to Mr. Reiser that maybe the defendant pledged plaintiff’s machinery as collateral for a business loan — which would be indicative of asserting ownership in the equipment thus contrary to a consignment. Mr. Reiser presented a pointed question to the defendant’s principal about whether his company ever granted any lender a security interest in his company’s assets. When he responded affirmatively, the next pointed question Mr. Reiser asked was whether he had ever pledged plaintiff’s machinery as collateral for any loans taken by his company. The defendant’s principal denied having done so, but his facial expression showed concern when Mr. Reiser informed him during the deposition that our firm would be ordering a Uniform Commercial Code search in New Jersey to confirm his statement. (When a bank or other lender issues financing to a business the financing is typically secured by a lien on all equipment and assets of the business. The lien is reflected in a Uniform Commercial Code financing statement filed at the state level, and sometimes at the County level).
Clearly, our deposition inquiry about pledging of our client’s equipment struck a nerve! The case settled shortly thereafter for $20,000 lump sum payment during a court ordered mediation.
Kesheshian vs. Deutsche Bank AG Investment Management Americas, Inc., Superior Court of New Jersey, Law Division, Bergen County, Docket No.: BER-L-7017-04
In this case, we represented Deutsche Bank in a lawsuit filed by a disgruntled plaintiff, who happened to be a lawyer, claiming that the bank’s brokerage division improperly liquidated and transferred his shares in certain mutual funds without his knowledge or consent. His lawsuit accused the bank of mismanaging his account and sought unspecified damages. The transfers from one set of mutual funds to another had happened many years earlier, and during the entire time period the bank’s brokerage division had issued monthly account statements reflecting the plaintiff’s mutual fund holdings. So the lawsuit seemed to have some serious holes.
Our client viewed the lawsuit as frivolous, yet wanted to dispose of the case with minimal expenditure of attorneys’ fees. Believing that the plaintiff’s income tax returns would reflect all of the dividend income that he received from these mutual funds, thereby confirming that he knew what his mutual fund holdings were, our firm demanded that the plaintiff turnover his income tax returns for the years in question. Proving to be the correct pressure point, the plaintiff refused to produce his tax returns and quickly agreed to settle the case for less than $750.
TollFreeNumbers.Com vs. Guardian Digital, Inc., et al., Superior Court of New Jersey, Chancery Division, Docket No.: C-311-09
In this case, an Internet company hired us to file an emergent lawsuit against a hosting company defendant who surreptitiously shut down our client’s website and refused to release any website files or source code because of a payment dispute. Our client’s business revenues are generated exclusively from its website, so the shutting down of the website threatened to put our client out of business.
In a matter of several days we filed an Order to Show Cause seeking a temporary injunction compelling the defendant to restore the website so that our client’s business would not suffer any further damage. After being served with the Order to Show Cause, the defendant voluntarily consented to restoring the website back to the Internet but refused to turnover the website files and source code, insisting that my client pay more than $20,000 as a condition of his releasing the information. According to our client, the defendant had no right to claim ownership in any of his website files, images, source code, website design, layout, content, etc.
In an effort to get our client’s website completely out from under the control of the defendant hosting company without spending thousands of dollars in legal and expert fees arguing over who owned what and why, we recommended to our client that he post the full amount of the disputed hosting invoices into escrow as a condition precedent to persuading the Court to order the defendant to release the entire website files and source code so that our client could move the website to another hosting company and be free from the defendant’s continued threats and interference. Also, by putting the money into escrow the defendant would not be able to access it pending the outcome of the balance of the trial concerning damages.
The strategy worked to perfection! As a result, our client was finally able to remove his website from the defendant’s grasp without having to wait a year for a trial to occur. Thereafter, the parties agreed to submit their damage claims to binding arbitration. The arbitrator ruled in our client’s favor by awarding the return of the entire $21,000 escrow plus an additional $15,000 in damages for lost revenues. Click here to read the arbitrator’s written decision.
Chedid vs. Helewa, Superior Court of New Jersey, Chancery Division, Bergen County, Docket No.: C-25-12
In this case, we represented a husband and wife in a bitter family dispute over residential property which they owned as co-tenants with the estate of the wife’s father. In the father’s last will and testament he left his portion of the property to his 3 sons, who were the brothers of the wife. Over a several year period our clients unsuccessfully tried to purchase the estate’s co-tenancy interest, but the brothers refused, instead insisting that the house be sold on the open market at a price that far exceeded its fair market value. In addition, the brothers continually interfered with our clients’ efforts to rent an apartment located on the second floor of the house which resulted in depriving our clients of income necessary to service the mortgage debt. Over a several year period, the brothers refused to contribute a single dime to the payment of outstanding mortgages, real estate tax, repairs and maintenance. As a result, the property went into foreclosure.
Determined not to let her brothers win and throw her family out on the street, the clients secured a loan modification with the bank to resolve the foreclosure aspect, secured a new tenant to occupy the apartment, and retained our law firm to file a partition action seeking to compel the sale of the estate’s co-tenancy interest. Each party submitted their own real estate appraisal, but the estate’s appraisal was approximately $80,000 higher than our clients’ appraisal. The parties agreed to be bound by a Court-appoint real estate appraisers valuation regardless of future market conditions. The Court-appointed appraiser valued the property at only $10,000 higher than our client’s appraiser did, which should have enabled the case to settle quickly. However, the brothers still refused to negotiate in good faith or contribute a single penny to the property’s expenses.
The case seemed destined to go to trial, as the brothers were just being completely unreasonable. Our clients asked us to do whatever was necessary to secure ownership of the house and avoid going to trial. We contemplated filing a motion for summary judgment, a process where the Court can grant judgment to the moving party as a matter of law when there are no genuine issues of material fact in dispute. But we were concerned that summary judgment would fail because there existed too many disputed factual issues about certain repair credits that my clients were seeking to recoup for expenses they advanced for improvements, renovations and general maintenance.
In our minds, we were trying to figure out how to box the defendants into the corner so that they would settle the case. The solution we came up with? Filing a motion to compel the pendente lite sale of the estate’s co-tenancy interest and depositing into escrow the amount of money we felt represented the defendants’ “best case” scenario – the estate’s net fair market value after deducting undisputed mortgage payments and major expenses. (Pendente lite is a Latin term that means “awaiting the litigation.” It is applied to preliminary or temporary court orders which remain in effect until the rest of the case is resolved.) That way, we could secure transfer of ownership in the house and the trial would be limited to fighting about disputed repair credits. Plus, we thought the motion would force the defendants to come to the table and settle.
Relying on our strategy, our clients deposited approximately $68,000 into our escrow account, and we prepared an extensive set of motion pleadings complete with a detailed affidavits and a legal memorandum outlining all of the equitable factors and legal authority which we felt justified the Court ruling in our clients’ favor. The strategy worked! The brothers filed a weak 2-page opposition to our extensive motion papers, thus signalling that either they didn’t want to spend a lot of money with their lawyer or simply couldn’t afford to. The case settled for $60,000 on the morning we appeared in Court to prosecute the pendente lite sale motion.
L&K Dental P.A., et al. vs. Receivable Management Service, et al., Superior Court of New Jersey, Law Division, Bergen County, Docket No.: BER-L-9555-09
In this case we successfully used one of New Jersey’s fee shifting remedies to recoup almost $21,000 in legal fees that our client incurred in defending a frivolous lawsuit.
We represented a telecommunications carrier who was sued by a disgruntled customer, a New Jersey dentist and his professional dental practice, claiming our client violated both the New Jersey Consumer Fraud Act (which provides for treble damages for engaging in unconscionable business practices) and the Fair Debt Collection Practices Act in connection with alleged misrepresentations made as an inducement to switch to its high speed Internet service, and efforts to collect a disputed debt resulting from the customer’s cancellation of the contract. Among his claims for damages, the dentist alleged to have suffered from the intentional infliction of emotional distress – a claim that we viewed as far fetched and frivolous.
After our initial review of the case, we developed a plan of attack that included our issuing the plaintiffs’ counsel a frivolous litigation letter pursuant to New Jersey Court Rule 1:4-8 informing him that the lawsuit lacked any merit and demanding that it be voluntarily dismissed, and that in the absence of their compliance our client would be seeking to recoup its reasonable attorneys’ fees and expenses incurred in defending the frivolous claims.
New Jersey Court Rule 1:4-8 is a fee shifting device intended to discourage the filing of baseless lawsuits. The Rule gives the recipient of the notice a safe-harbor period of 28 days in which to voluntarily dismiss a case without facing exposure to attorneys’ fee claims. If the litigant does not voluntarily withdraw the claim and the court later finds it to be frivolous then the party issuing the notice has a remedy to recover its reasonable counsel fees. Plaintiffs agreed to dismiss only 2 of the 3 claims against our client; they refused to dismiss the New Jersey Consumer Fraud Act claim.
We then successfully obtained summary judgment dismissing plaintiff’s New Jersey Consumer Fraud Act claim against our client – the court having agreed that the plaintiffs suffered no “ascertainable loss” (a requirement to sustain a claim under the New Jersey Consumer Fraud Act) because they received 4 months worth of free Internet service that they never paid for. (Click here to read our winning legal brief on the issue of summary judgment.) Thereafter, we filed a separate application requesting approximately $21,000 in legal fees and expenses. The trial court granted our request, awarding $20,948 in attorneys’ fees and costs. (Click here to read the trial court’s opinion imposing sanctions.)
Plaintiffs then appealed this decision to the Superior Court of New Jersey, Appellate Division, and as a condition of their appeal agreed to deposit the entire sanctions award with the New Jersey Trust Fund Unit in exchange for our client’s agreement not to execute on the fee award pending the outcome of the appeal. However, the Appellate Division denied plaintiffs’ appeal, as did the Supreme Court of Jersey who refused to hear their case. Thereafter, the trial court granted our motion for turnover of the $20,948 deposited by plaintiffs.
Drager vs. H&R Block, United States Bankruptcy Court, District of New Jersey, Case No.: 11-42200 (KCF)
In this case, we defended H&R Block against the claims of overzealous consumer debtors who alleged that H&R Block willfully violated the automatic stay that prohibits attempts to collect debts after a bankruptcy filing, by issuing a computer generated billing statement after the bankruptcy case had been commenced.
In their bankruptcy petition the debtors listed H&R Block as a creditor using several PO Box addresses appearing on the credit card billing statement. In an attempt to obtain a windfall, the debtors rushed to the courthouse steps by quickly filing a motion accusing H&R Block of purposely attempting to collect a debt in violation of the automatic stay, and requesting punitive damages.
H&R Block denied the allegations, maintaining that at the time it sent the computer generated billing statement the company had not received notice of the bankruptcy court case filing and thus was unaware of the debtors’ bankrupt status. After carefully reviewing the debtors’ bankruptcy petition along with documentation provided by our client, we observed that the debtors failed to use the proper service address for H&R Block appearing on the reverse side of its customer billing statements directing customers how and where to notify H&R Block of billing disputes. Instead, when they filed their bankruptcy petition the debtors used several payment drop addresses (PO Box numbers) for H&R Block.
Our discovery of the debtors’ critical error created a very strong defense to their claim that H&R Block willfully violated the automatic stay, and we encouraged our client to forcefully defend the matter. Especially considering that the alleged violation was nothing more than a single computer-generated billing statement sent in the ordinary course of H&R Block’s billing cycle.
We opposed the motion by filing a legal memorandum supported by an affidavit from the client. The bankruptcy court agreed with our position, concluding that H&R Block did not willfully violate the automatic stay because it did not receive proper service of the initial bankruptcy notice due to the debtors’ failure to use the proper address prominently disclosed on H&R Block’s customer billing statements. Thus, the judge denied the motion. Our client WON!
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* Disclaimer. Results are not guaranteed in any litigation matter. Each case is based on its own set of unique facts and circumstances, and judges may have different interpretations of the same laws and case decisions.