DISTRICT OF COLUMBIA COURT OF APPEALS
BOARD ON PROFESSIONAL RESPONSIBILITY
AD HOC HEARING COMMITTEE
In the Matter of:
ROBERT S. FASTOV,
Respondent.
A Member of the Bar of the
District of Columbia Court of Appeals
(Bar Registration No. 56333)
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Bar Docket No. 105-07
REPORT AND RECOMMENDATION OF
AD HOC HEARING COMMITTEE
INTRODUCTION
I.
Background
This case arises out of Respondent Robert S. Fastov’s conduct in threatening, filing, and
prosecuting two lawsuits on his own behalf: Fastov v. Christie’s and Fastov v. Palisades. The
first case, against Christie’s auction house, was disposed of at summary judgment and
Respondent was sanctioned more than half a million dollars for his “bad faith, vexatious and
oppressive conduct.”
See infra ¶ 74.
The second matter, in which Respondent sued his
neighborhood pool association and certain of its Board members, was dismissed on defendants’
motion for lack of jurisdiction and deemed by the Court to be a “frivolous” suit brought “for the
purpose of harassing Defendants.” See infra ¶ 112. The gravamen of Bar Counsel’s charges is
that Respondent filed and prosecuted meritless claims solely to harass and burden his adversary,
and that in the process, he needlessly burdened the courts with specious arguments, overly-long
filings, and pointless relitigation.
On March 15-17, 2010, an Ad Hoc Hearing Committee of James T. Phalen, Esquire,
Chair, Suzanne Kramer, and Catherine S. Duval, Esquire, heard evidence and argument in this
matter. Respondent appeared pro se. Bar Counsel called one witness, Jeffrey Bryan. Bar
Counsel’s Exhibits (“BX”) 1-89 were received in evidence without objection. Transcript of the
Hearing (“Tr.”) 199, 860. Respondent testified on his own behalf and called no other witnesses.
Respondent’s Exhibits (“RX”) 1-66 were received in evidence without objection. Tr. 860-61.
Without objection, the Hearing Committee also received in evidence as Hearing Committee
Exhibit No. 1, “Respondent Robert S. Fastov’s Preliminary Statement and Presentation to the Ad
Hoc Hearing Committee Regarding the Specification of Charges Presented by Bar Counsel
Against Fastov.” The Hearing Committee accepted this exhibit in lieu of Respondent reading it
to the Committee during the hearing. Tr. 49-51.
We recommend that Respondent be suspended from the practice of law for eighteen
months with a fitness requirement because he used the legal system not as a means of resolving
legitimate disputes, but rather, to punish those with whom he had a disagreement. Respondent
was mad at the people and entities he sued: Christie’s auction house and the Board of the
Palisades Swimming Pool Association. He used the courts to mete out what he believed would
be guaranteed retribution: even if these defendants prevailed on the merits, they would not
“win” because they could not escape the financial and other costs of litigation. To implement
this plan, Respondent used means intended to increase the cost and burden of litigation for the
defendants, with the attendant, although perhaps unintended, burden on the courts and harm to
third persons.
We do not recommend that Respondent be suspended simply because he aggressively
litigated his cases. We recognize that litigators are obliged to provide zealous representation;
they can and often should use every tool available to them. What attorneys must not do,
2
however, is ignore their professional responsibilities to the judicial system, the public, clients and
the bar. Under the D.C. Rules of Professional Conduct, a lawyer “shall not”: bring frivolous
claims (Rule 3.1); take actions “solely to harass or maliciously injure another” (Rule 3.2);
“knowingly disobey an obligation under the rules of a tribunal” (Rule 3.4(c)); or, “use means that
have no substantial purpose other than to embarrass, delay, or burden a third person” (Rule
4.4(a)). Further, it is “professional misconduct” to “engage in conduct that seriously interferes
with the administration of justice.” Rule 8.4(d). We find that Respondent violated these rules
when he pressed objectively meritless issues, ignored court rules and orders, threatened
gratuitous harm to uninvolved third parties, and filed hundreds of pages of frivolous pleadings.
II.
Summary
A.
The Conduct at Issue
In Fastov v. Christie’s, Respondent sued Christie’s, the international art auction house,
after Christie’s declined to offer one of his paintings at auction because it could not verify the
painting’s authenticity. Bar Counsel argues that Respondent threatened suit, filed a Complaint,
and unreasonably prosecuted the action because he wanted to extort a favorable settlement from
Christie’s, not because his suit had objective merit. In advancing this position, Bar Counsel
relies heavily on Respondent’s unquestionably threatening conduct before and during the
litigation, and on rulings by the Honorable William Stafford, Jr., who granted summary
judgment against Respondent and sanctioned him more than $600,000 for bringing and
prosecuting the matter against Christie’s. 1
1
Prior to the Hearing, Bar Counsel moved to give preclusive effect to Judge Stafford’s
March 14, 2007 Order, in which he found that Respondent had initiated and prosecuted the suit
in bad faith, in order to harass the Defendants. We denied that motion because we wanted to
give Respondent an opportunity in this forum to present evidence and argument on the issue.
See Tr. 21, 37-39.
3
As more fully discussed below, we do not accept Bar Counsel’s position in its entirety.
Instead, we find that Respondent believed that Christie’s personnel told him that Christie’s
would not auction his painting because a renowned art expert opined that it was a fake. When
Respondent later learned that the expert had not called his painting a fake, Respondent believed
that he had been misled by Christie’s. We find that, under the circumstances, Respondent
reasonably believed that he had been misled. That reasonable belief may have supported a
relatively limited suit against Christie’s, focused on determining whether Christie’s employees
had intentionally or negligently misled him, and whether he had been damaged as a result.
However, Respondent did not bring such a limited suit against Christie’s, and as he
threatened in one of his letters, he litigated in a manner designed not to resolve the dispute, but
rather, to bring about Christie’s “unconditional surrender.” Respondent’s prosecution of the
action was entirely out of proportion to any reasonable dispute between the parties and any
colorable damage claim. Thus, while we find that Respondent may have had a reasonable basis
for suing Christie’s, he did not have a reasonable basis for all of the claims he brought, or the
manner in which he prosecuted the action. We find that he sued Christie’s simply because he
was angry, and he believed that he “would make Christie’s pay,” whether he won the suit or not.
His were not the actions of a lawyer appropriately attempting to use the legal system to resolve a
legitimate dispute, but rather those of an disappointed art seller abusing his knowledge of the
legal system to inflict damage on an auction house that would not sell his painting.
In the second lawsuit, Fastov v. Palisades, Respondent sued the Board of Directors of his
local pool, Palisades Swimming Pool Association, Inc. (“Palisades”), claiming that the Board
had called him a “sexual pervert, pederast, pedophile, assaulter and batterer.” This accusation
grew out of a letter from the Board, warning Respondent to cease conduct that certain other
4
members of the pool found to be objectionable. Importantly, the Board did not (in that letter or
otherwise) accuse him of being a “sexual pervert, pederast, pedophile, assaulter and batterer.”
When Respondent did not repeat the conduct at issue, the Board considered the matter closed and
so notified Respondent. Nonetheless, Respondent refused to let the matter drop, and filed suit in
Maryland federal court against Palisades and certain members of its Board. Unlike the Christie’s
matter, Respondent had no colorable claims against the Palisades Board. Indeed, Respondent
essentially conceded that this suit lacked any merit when he testified that many of the claims in
his Complaint were “levers” or “pressure points” intended to cause the Palisades Board to settle
with him.
B.
Bar Counsel’s Charges
Bar Counsel charged that Respondent’s conduct in bringing and prosecuting Fastov v.
Christie’s violated D.C. Rules of Professional Conduct 3.1 (bringing and pursuing frivolous
claims), 3.2 (delaying the proceedings solely to harass or maliciously injure others), 3.4(c)
(knowingly disobeying court rules), 4.4 (using means having no substantial purpose other than to
embarrass, delay or burden others), and 8.4(d) (seriously interfering with the administration of
justice). BX 2 at 22-23. In Count Two, Bar Counsel charged that Respondent violated Rules
3.1, 4.4 and 8.4(d) in bringing Fastov v. Palisades. Id. at 30.
C.
Our Conclusions
We find that Bar Counsel has proven each of the alleged Rule violations by clear and
convincing evidence. Even though we find that Respondent had a colorable basis for bringing
certain claims against Christie’s, we find that Bar Counsel has proven a Rule 3.1 violation
regarding that litigation because, in addition to bringing colorable claims, Respondent asserted
claims that had no basis in fact or law.
5
Although we find that Respondent may have reasonably believed that he had a claim
against Christie’s, his threatening pre-litigation conduct and obstreperous litigation tactics make
clear that he was not interested in using litigation to resolve a dispute with Christie’s. Rather, he
wanted to punish Christie’s for declining to offer his painting at auction. In sum, even assuming
that Respondent had a valid cause of action, his vituperative tactics fell far outside “zealous
advocacy.”
With respect to the Palisades lawsuit, we find no reasonable basis for any of
Respondent’s conduct. There was absolutely no justification for his allegation that members of
the Palisades Board had accused him of being a “sexual pervert, pederast, pedophile, assaulter
and batterer.” As the text of the letter demonstrates, the Palisades Board had simply directed him
to stop behavior that other pool members found to be inappropriate. Most troublingly, although
Respondent ultimately stopped the behavior that gave rise to the warning, he refused to let go of
his dispute with the Board, and instead demanded an apology, and more (including payment for
time spent writing pointless letters to the Board). We find that Respondent sued the Palisades
Board because Board members had the temerity to tell him that his behavior was unacceptable,
and Respondent wanted to make their lives miserable as a result.
We recommend that Respondent be suspended for eighteen months with a fitness
requirement.
A fitness requirement is warranted here—and is more important than the length of any
suspension—because Respondent has admitted that he lacks the ability to practice law. Indeed,
on page 302 of his Answer to the Specification of Charges, Respondent represents that
“[b]ecause of my age, I am almost 67, and my impaired health and other physical and mental
limitations and incapacities and my dislike of litigation and other practice of law [sic] and
6
attorneys, I have absolutely no intention, inclination, desire or physical or mental capacity to
engage in litigation of any kind or practice of law in the future.” Unfortunately, Respondent’s
conduct during the hearing reinforced his admission that he is unable competently to practice as
a lawyer. Although Respondent filed a tremendous amount of written material, he did not appear
to be fully prepared to respond to Bar Counsel’s charges during the hearing, and was unable to
cogently and coherently explain his theory of defense.
FINDINGS OF FACT
I.
Introduction
1.
Respondent was admitted to the United States District Court for the District of
Columbia in December 1969, and to the D.C. Bar in 1972, and assigned Bar number 56333.
BX 1.
2.
Respondent was a federal government attorney during the entirety of his active
law practice, which ended in December 1985, when he left his position as Deputy Chief Counsel
of the Economic Development Corporation, Department of Commerce. By 1987, Respondent
had formed Fastov Galleries and was working as an art dealer. BX 14 at 150-51 (Fastov
Deposition (“Dep.”) 6-12); Tr. 211-27.
II.
Facts Relating to Fastov v. Christie’s
A.
Background
3.
In May 1985, Respondent purchased a landscape painting for $600. Respondent
believed that the painting was signed by Emil Jakob Schindler, a 19th-Century Austrian artist.
BX 14 at 157-58 (Fastov Dep. 55-64).
4.
In February 1986, Respondent sent photographs and transparencies of the painting
to Dr. Gerbert Frödl, Director of the Austrian national art museum, in the hope that Dr. Frödl
7
would opine that Schindler was the artist. BX 14 at 238; Tr. 791. In June 1986, Dr. Frödl
replied to Respondent, informing him that he believed that the painting was an authentic
Schindler, but that he would have to see it in person in order to render a definitive judgment. See
BX 14 at 241 (translation of June 14, 1986 Frödl letter) (“[t]o give you a binding judgement
[sic], it would be necessary to know the original. But I can say, that I believe as you do, that the
painting originated from the hand of Schindler, although the foreground with the sheep and the
water seems rather untypical.”). Respondent never sent the painting to Dr. Frödl for further
review. Tr. 840-42.
B.
Respondent’s Initial Discussions With Christie’s
5.
In early 1993, Respondent read in an advertisement that Christie’s sent to him that
Christie’s planned an auction of German and Austrian art in May 1993. Tr. 779-80. On
February 11, 1993, Respondent mailed a letter on Fastov Galleries letterhead to Christie’s in
London, in which he proposed to consign the above-described landscape painting and other
artworks to Christie’s for auction. He included photographs and the color transparencies of the
painting. RX 53.
6.
Respondent testified that he spoke by telephone with Wendy Goldsmith at
Christie’s in London between February 18 and 26, 1993, and that Ms. Goldsmith orally agreed
that Christie’s would offer the painting for sale as an “unqualifiedly authentic Schindler
painting” and that Christie’s would not seek an expert opinion as to its authenticity. Tr. 815; see
also Tr. 262-63, 266, 270, 283-84, 797-98, 810-11, 815-18, 821. Respondent testified that he
would not have consigned the painting but for Christie’s alleged oral agreement not to seek an
opinion on authenticity. Tr. 455. As is discussed below, we find that Respondent and Christie’s
did not enter into such an agreement.
8
7.
On March 2, 1993, Respondent sent the painting and two other artworks to
Christie’s in London. Tr. 790; BX 4 at 3 (¶ 9). Prior to sending the paintings to Christie’s,
Respondent had limited contact with the Christie’s office in Washington, D.C. He spoke briefly
with Marya Oja, a Christie’s employee, about the company’s shipping prices and other shipping
options. Tr. 777-78; BX 6 at 11. Respondent has never contended that Ms. Oja (or the Christie’s
D.C. office) engaged in any dishonest or actionable conduct. Tr. 777-78.
8.
On or about March 5, 1993, Christie’s sent Respondent a document that
acknowledged receipt of the paintings and set forth the Conditions of Business under which
Christie’s would offer the paintings for sale, which included the following terms:
1.
Christie’s discretion
(a)
Christie’s shall have absolute discretion as to:
(i)
(iii)
(b)
whether the Lot is suitable for sale by Christie’s,
and if so as to the place and date of sale, the
conditions of sale and the manner in which such
sale is conducted;
***
whether the views of any expert shall be obtained . .
..
Christie’s reserves the right to withdraw any property at
any time before the actual sale if, in Christie’s sole
judgment:
(i)
there is any doubt as to its attribution or to its
authenticity . . . .
BX 14 at 135 (emphasis added).
9.
Respondent received the receipt with these conditions on or about March 15,
1993. Tr. 808-09. Respondent maintains that the above-quoted language did not apply to the
Schindler painting because Ms. Goldsmith had orally agreed to auction the painting without
seeking an expert opinion. See, e.g., Tr. 282 (“the conditions of business were not applicable” to
9
the Schindler painting); see also Tr. 283-84. We reject Respondent’s version of events, and find
that there was no such agreement between Respondent and Christie’s. 2
10.
It is inconceivable that Ms. Goldsmith promised that Christie’s would sell the
painting, sight unseen, as an “unqualifiedly authentic Schindler painting.” Bar Counsel offered a
declaration submitted by Ms. Goldsmith, in which she represented that when she spoke with
Respondent in February, 1993, she “did not consider [her]self to be entering into a binding
agreement to auction the Painting [sic] at that time, and particularly not an agreement waiving
[Christie’s] discretion to consult experts.” BX 14 at 128. In addition, Bar Counsel offered a
declaration from Christie’s executive Lord Mark Poltimore, who represented that he “do[es] not
know of any occasion when [Christie’s] has waived terms relating to use of experts or discretion
in case of authenticity questions.” BX 14 at 116. Lord Poltimore further represented that
Christie’s provides its buyers with a five year warranty of authenticity and that “[b]ecause of the
warranty, to preserve [Christie’s] reputation, and as a matter of good faith to buyers, [Christie’s]
must be careful in determining and representing the authenticity of lots offered at auction.” Id. at
117. Indeed, despite Respondent’s testimony that Ms. Goldsmith promised, sight unseen, to sell
the painting as an authentic Schindler, he conceded that Christie’s could refuse to sell artwork if
it doubted its authenticity. See Tr. 446.
11.
Moreover, it is reasonable to conclude that if Ms. Goldsmith had agreed not to
seek an expert opinion, she would not have listed the Schindler painting on a receipt that
specifically allowed Christie’s to seek an expert opinion. She could have used some other form
of receipt, or amended this receipt to make it clear that the Schindler painting was not covered by
2
Although we reject Respondent’s assertion that he had an oral consignment agreement
with Christie’s, we do not find that he gave false testimony on this issue because we find that he
believes that he had an oral consignment agreement with Christie’s.
10
the above-quoted language. Importantly, even though Respondent crossed out certain portions of
the receipt—dealing with commissions—before he returned it to Christie’s, he did nothing to
indicate that the above-quoted sections did not apply to the Schindler painting, or more
specifically, that Ms. Goldsmith had agreed that Christie’s would auction the painting without an
expert opinion on authenticity. See BX 14 at 133-36.
12.
In addition, Bar Counsel submitted a declaration from Sue Goddard of Christie’s,
who represented that she spoke with Respondent several times during March 1993, and that he
was insistent that Christie’s obtain Dr. Heinrich Fuchs’ opinion regarding authenticity. BX 14 at
141-42 (Goddard Decl. ¶¶ 3-4). On March 11, 1993, Ms. Goddard sent a memorandum to Dr.
Johanna Schönburg-Hartenstein (a Christie’s employee in Vienna) relaying several requests from
Respondent, including “above all to get authentication from [Dr.] Fuchs.” BX 14 at 144.
C.
Christie’s Consults With Dr. Frödl
13.
Respondent and Christie’s agree that Dr. Schönburg-Hartenstein contacted Dr.
Frödl in March 1993 to seek his help in identifying the castle and the river depicted in the
painting. Tr. 271; BX 14 at 112 (Schönburg-Hartenstein Decl. at 3, ¶7). Somewhat surprisingly,
Respondent asserts that Christie’s could contact Dr. Frödl for this purpose without breaching the
alleged oral consignment agreement because Christie’s “did not ask for an opinion on the
authenticity of the painting.” Tr. 284; see also Tr. 283-84; 810-11; 829-30; Respondent’s PostHearing Response Brief, at 16; but see RX 13a at 8, ¶14 (Respondent’s declaration submitted in
opposition to Christie’s summary judgment motion, in which he asserts that Christie’s breached
the oral consignment agreement by consulting with Dr. Frödl). Thus, according to Respondent,
Christie’s could talk with Dr. Frödl about the painting, and seek his help in identifying the locale
depicted, but could not ask whether he thought the painting was authentic. This makes no sense.
11
This cramped view of the alleged restraint on Christie’s ability to consult with an outside expert
further supports our view that Ms. Goldsmith never agreed that Christie’s would not seek an
expert opinion on authenticity.
14.
Although Lord Poltimore and Ms. Goldsmith believed “that the painting generally
appeared to be authentic,” because the painting lacked documented evidence of provenance
(ownership history) and did not appear in authoritative books on Schindler, they directed Dr.
Schönburg-Hartenstein to also ask Dr. Frödl for his opinion on the painting’s authenticity.
BX 14 at 121-22 (Poltimore Decl. ¶¶ 22-26), 129 (Goldsmith Decl. ¶ 12); BX 14 at 112
(Schönburg-Hartenstein Decl. ¶ 8). 3 Thus, although Respondent and Christie’s agree that Dr.
Schönburg-Hartenstein showed Dr. Frödl transparencies of the painting, they disagree on the
purpose, and more importantly, they disagree on much of what Dr. Frödl said.
15.
Respondent maintains that Ms. Goldsmith told him that when Dr. Frödl saw the
transparencies in March 1993, he recognized the painting from the photographs and
transparencies that Respondent had sent in 1986, and that he volunteered “that the painting was
an authentic Schindler painting.” See BX 6 (Complaint, p. 34, ¶ 51). Respondent testified to the
following as his understanding of the events:
I was told that—do [you] remember what I went through
where [Dr.] Frödl is shown the photographs and asked for the
geographic and historical information and he says “Whoopee, had I
[sic] remember this picture from 1986. How would you guys like
a nice written opinion, an unqualified opinion on authenticity in
writing?”
3
Dr. Frödl has said that Christie’s did not ask “for an opinion on authenticity.” BX 14 at
361 (March 11, 2004 letter). We did not hear testimony from Dr. Frödl or any of the Christie’s
witnesses, and we do not resolve this contradiction. However, none of our conclusions turn on
whether Dr. Frödl thought that Dr. Schönburg-Hartenstein requested his opinion on authenticity,
as opposed to information regarding the scene depicted in the painting.
12
He sua sponte volunteered to give them one. That was
circa March 15th, 1993, which was related to me in a conversation
of March 19th, 1993.
Tr. 285; see also Tr. 828-30. This is reasonably consistent with Dr. Schönburg-Hartenstein’s
version of events: “To my recollection, Dr. Frödl was initially somewhat optimistic about the
painting and expressed a preliminary opinion that it might be a true Schindler.” BX 14 at 113
(Schönburg-Hartenstein Decl. at 4, ¶9). Thus, Christie’s and Respondent agreed that, at least
initially, Dr. Frödl thought that this might be an original Schindler. What happened next is hotly
contested, and serves as part of the basis for Respondent’s suit against Christie’s, and thus, for
our determination of Respondent’s good faith in bringing suit against Christie’s.
16.
According to Dr. Schönburg-Hartenstein, although Dr. Frödl had been initially
optimistic about the painting’s authenticity, he later
reported that he recognized the painting from an earlier inquiry
(that is, from Mr. Fastov’s prior letter) and that he could not give
an opinion about the painting without actually viewing the original
instead of the photographs and transparencies, in light of concerns
he had about the apparent weakness of some elements of the
painting.
BX 14 at 113 (Schönburg-Hartenstein Decl. at 4, ¶ 9). Dr. Frödl’s concern about certain
elements of the painting is consistent with his 1986 letter to Respondent, which noted
“untypical” aspects of the painting. See supra, ¶ 4.
17.
Dr. Schönburg-Hartenstein informed Ms. Goldsmith of Dr. Frödl’s inability to
commit to an authenticity opinion. BX 14 at 113 (Schönburg-Hartenstein Decl. at 4, ¶ 10). Ms.
Goldsmith then called Respondent and told him that Christie’s would not auction the painting
because Dr. Frödl could not commit to an opinion without seeing the original painting. BX 14
13
at 130 (Goldsmith Decl. at 5, ¶ 15). 4 Shortly thereafter Dr. Schönburg-Hartenstein received a
call from Respondent, who she described as “emotional and upset.” BX 14 at 113 (SchönburgHartenstein Decl. at 4, ¶ 11). Dr. Schönburg-Hartenstein told Respondent “that Dr. Frödl could
not give an opinion about the painting without actually viewing the original instead of the
photographs and transparencies, in light of concerns about the apparent weakness of some
elements of the painting.” Id.
18.
Respondent testified that on or about April 1, 1993, Ms. Goldsmith told
Respondent that Christie’s would not auction the Schindler painting because Dr. Frödl had
changed his mind regarding authenticity. Respondent testified that he understood from Ms.
Goldsmith that “[w]hat [Dr. Frödl] said at the time was ‘The painting is not authentic and, in
addition, it is a fake.’” 5 Id.; see also RX 14 at 259-60 (excerpt from Respondent’s First
Amended Complaint) (Dr. Frödl “now believed that [Respondent’s] painting was in fact a fake
and was not an authentic Schindler.”). Respondent also testified that Dr. Schönburg-Hartenstein
confirmed this in a call on April 2, 1993. Tr. 831.
19.
While Respondent’s version of events is not entirely consistent with Ms.
Goldsmith’s or Dr. Schönburg-Hartenstein’s, in light of the similarities among the different
versions of events, we find that Respondent reasonably misunderstood what he was told about
the reason Christie’s declined to offer the painting at auction. First, Dr. Schönburg-Hartenstein
reported that Dr. Frödl gave a preliminary opinion that it might be a true Schindler. Then,
4
Because Christie’s decided not to offer Respondent’s painting before printing the pre-sale
catalog, the public was unaware that Christie’s had declined to auction the painting. BX 14
at 123-24 (Poltimore Decl. ¶¶ 28-30); 129-30 (Goldsmith Decl. ¶¶ 14-15).
5
Respondent testified that the terms “not authentic” and “fake” have different meanings.
According to Respondent, a Schindler painting is “not authentic” if it was created as a copy of a
Schindler painting, and then someone later added Schindler’s signature to the painting. A
painting is a “fake” if the painting was created for the purpose of deceiving, so that it could be
offered as a Schindler. Tr. 239. This distinction does not affect our analysis of any of the issues.
14
Respondent learned that Dr. Frödl has changed his mind, and Respondent understood that this
meant that Dr. Frödl had decided that the painting was not an authentic Schindler.
20.
Bar Counsel did not present live testimony from Dr. Frödl or any of the Christie’s
witnesses, and we cannot determine exactly who said what to whom. Thus, we cannot say
whether Dr. Schönburg-Hartenstein made clear to Respondent that Dr. Frödl was not saying that
the painting was a fake, only that he could not give a definitive opinion; or, whether the
conversation was more ambiguous, such that Respondent would reasonably believe that Dr.
Frödl opined that the painting was a fake. Without testimony from Ms. Goldsmith or Dr.
Schönburg-Hartenstein as to their conversations with Respondent, we are left to glean
Respondent’s understanding of the facts from his testimony and contemporaneous documents,
such as Respondent’s April 10, 1993 and January 19, 1994 letters.
21.
Respondent’s April 10, 1993 letter to Ms. Goldsmith appears to be the best
available contemporaneous evidence of Respondent’s erroneous, but reasonable, understanding
of Dr. Frödl’s opinion. In that letter, he writes that according to Dr. Schönburg-Hartenstein, on
the day that Dr. Frödl was to give her an authenticity letter, Dr. Frödl told her
that he had changed his mind, cited the ‘typicality’ and ‘quality’ of
the painting and advised that he also ‘consulted’ another
‘colleague’ (of unknown qualifications). He offered no opinion as
to whether the painting was a pastiche/copy, fake
contemporaneous with Schindler or a recent (i.e., 1970-1980) fake.
BX 14 at 301 (emphasis added).
According to Respondent’s testimony, he meant the
emphasized language to convey that he understood that Dr. Frödl had said that the painting was a
15
fake, but he had not decided what type of fake. See Tr. 304-05. This certainly reflects that
Respondent believed that Dr. Frödl had called the painting a fake. 6
22.
We believe that it is significant that Respondent made a point of noting in the
April 10 letter that he was writing the letter to “make clear . . . [his] good faith when [he] sent the
painting to” Christie’s. BX 14 at 303. We conclude that this reflects Respondent’s concern that
Christie’s might believe that he had intentionally attempted to pass off a fake. He would not
have been so concerned if he understood that Dr. Frödl had not called his painting a fake, but
rather, simply declined to offer any opinion at all because he had not seen the painting in person.
Respondent included a copy of Dr. Frödl’s 1986 letter in the April 1993 letter to Ms. Goldsmith,
stated that there was a “strong possibility” that he would ship the painting to Dr. Frödl for
inspection so that he could provide a favorable opinion, and instructed Christie’s to continue to
hold the painting. BX 14 at 298 (April 10, 1993 letter); Tr. 832-34, 840-42.
23.
Importantly, neither Ms. Goldsmith nor anyone else at Christie’s responded to this
letter to make clear that neither Dr. Frödl nor Christie’s had called the painting a fake. Thus,
there was nothing to prevent Respondent from continuing to operate under the belief that Dr.
Frödl and Christie’s believed that the painting was a fake.
24.
As discussed in more detail below, Respondent wrote to Dr. Frödl on January 19,
1994, and this letter also confirms Respondent’s understanding that Dr. Frödl did not believe the
6
This letter is also evidence that there was no oral consignment agreement that precluded
Christie’s from seeking an expert opinion on authenticity. Respondent does not say that Ms.
Goldsmith breached her agreement with him by showing the painting to Dr. Frödl, and in fact,
says only that “[i]nasmuch as I had not requested you to obtain [Dr. Frödl’s] opinion, I had no
objection to you absorbing the fee” for Dr. Frödl’s authenticity opinion. BX 14 at 301.
Certainly if Respondent had believed that Ms. Goldsmith has broken her promise not to seek an
authenticity opinion from Dr. Frödl, he would have noted it in this letter.
As discussed above in Paragraph 13, we do not accept Respondent’s explanation that
Christie’s was free to seek expert help in determining the scene depicted in the painting, but
could not ask an expert for an authenticity opinion.
16
painting was an authentic Schindler.
Respondent wrote that Dr. Frödl had advised Dr.
Schönburg-Hartenstein “that, contrary to the views you expressed to me in your letter of June 15,
1986 and to [Dr. Schönburg-Hartenstein] in a circa March 15, 1993 conversation, you believed
that the above-described painting (that I own) was not by Emil Jakob Schindler (1842-1892).”
BX 14 at 309; see also id. (referring to Dr. Frödl’s “view that the painting is not by E.J.
Schindler”). Certainly if Respondent understood that Dr. Frödl needed only to see the original
before reaching a decision, he would not have suggested that the painting might be anything
other than authentic.
25.
Based on the foregoing, we conclude that there was a misunderstanding between
Respondent and Christie’s as to Dr. Frödl’s opinion on the painting. Although we find that Dr.
Frödl had not called the painting a fake, we find that Respondent reasonably believed that he
had. 7
7
While it would have been preferable to hear from Dr. Frödl and the Christie’s witnesses,
we have no reason to doubt the assertions in their letters and declarations that Dr. Frödl had not
called the painting a fake. See BX 14 at 240-41 (Dr. Frödl’s 1986 letter) and BX 14 at 360-61
(Dr. Frödl’s 1994 letter); BX 14 at 113 (Schönburg-Hartenstein Decl. ¶¶ 9-11); 123-24
(Poltimore Decl. ¶¶ 28-29, 31); 129-30 (Goldsmith Decl. ¶¶ 13, 15). Moreover, according to
Christie’s Conditions of Business, Christie’s employees were within their rights to decline to
offer a painting if there was some doubt as to its authenticity. They did not need to call it a fake.
Similarly, as Lord Poltimore noted in his declaration, “[i]t is in [Christie’s] interest to sell as
many paintings as possible at the highest prices possible, so [Christie’s] had no interest in
avoiding auctioning Mr. Fastov’s painting if it were authentic.” BX 14 at 123-24 (Poltimore
Decl. at 9-10, ¶ 29). Moreover, it is not credible that Dr. Frödl, who told Respondent in 1986
that he could not render a binding opinion without seeing the painting in person, would, seven
years later, first decide that the painting is authentic, and then abruptly reverse course and decide
that it is a fake, all without ever having seen the painting in person. That just makes no sense.
We are convinced that Dr. Frödl told Christie’s that he could not give a binding judgment
without seeing the painting in person, and without Dr. Frödl’s opinion, Christie’s withdrew it
from the auction, as it was entitled to do.
17
D.
Respondent Gets An Opinion From Dr. Fuchs
26.
By letter dated May 1, 1993, Respondent sent photographs and a transparency of
the painting to another expert, Dr. Heinrich Fuchs, requesting his authenticity opinion.
Respondent sought Dr. Fuchs’ opinion because Dr. Fuchs published a Schindler catalogue
raisonne (a scholarly compilation of Schindler’s work) in 1970. BX 14 at 292; see Tr. 228, 28789. In his letter, Respondent acknowledged to Dr. Fuchs that certain aspects of the painting were
not “typical” of other Schindler works, but contended the painting had similarities to two other
Schindler works. BX 14 at 295-96. In June, 1993, Dr. Fuchs provided Respondent with a
certificate of authenticity. BX 14 at 304-05.
27.
In November 1993, Respondent informed Christie’s of Dr. Fuchs’s certificate of
authenticity, but Christie’s declined to offer the painting for sale without a positive opinion from
Dr. Frödl. BX 6 at 106-16 (¶¶ 225-57).
E.
Respondent Tries to Get Dr. Frödl’s Opinion
28.
On January 19, 1994, Respondent sent Dr. Frödl a 19-page letter on Respondent’s
legal letterhead (“Robert S. Fastov, Attorney at Law”), together with a 31-page appendix. BX 14
at 308. In this letter, Respondent requested Dr. Frödl’s opinion as to the painting’s authenticity.
Id. at 322. Inexplicably, Respondent never shipped the painting to Dr. Frödl for inspection
(Tr. 841) even though he complained that Dr. Frödl could not form an “independent, credible
judgment” because he “had never physically inspected the painting and knew nothing of its
restoration or condition.” BX 14 at 311. 8
8
It is unclear why Respondent did not send the painting to Dr. Frödl, but instead decided
to argue with Christie’s and Dr. Frödl about the painting’s authenticity and criticize Dr. Frödl’s
inability to opine on authenticity without an in-person examination. While one logical
explanation for Respondent’s behavior is that he doubted that the painting was an authentic
Schindler, based on Respondent’s testimony during the hearing, we do not believe that
18
29.
Respondent demanded a response to his letter, threatening that if Dr. Frödl failed
to respond, he would invite “adverse consequences in terms of [his] time, reputation, financial
resources and future income prospects, of all of the options [Respondent was] considering.”
BX 14 at 326 (January 19, 1994 letter at 19). Respondent then told Dr. Frödl that “[i]t will be
much simpler and better for both of us and far less costly over the long term” for Dr. Frödl to
provide a certificate of authenticity, or a detailed rationale for his “disagreement with Dr. Fuchs
and [Respondent].” Id. To provide some teeth to this language, Respondent threatened to use
litigation if Dr. Frödl did not comply with his demands:
Dr. Frödl, it is as certain as Wien is the capital of Österreich that I
will respond to your silence by initiating and pursuing to their
successful conclusions one and probably more of these options
which, obviously, will include certain litigation options. Whatever
you may think of my art expertise, I can assure you that as Deputy
Chief Counsel in charge of a major U.S. government agency
litigation unit for over 13 years, I developed an excellent
reputation and experience in a wide variety of lawsuits that are far
more complex than the issues raised in this matter, involved,
generally, [sic] millions of dollars and generated a great deal more
publicity than this matter will. In this last regard, you can assume,
however, that the Austrian and European publicity generated by
these options will be more than sufficient. I also have significant
experience in legal claims and litigation involving art issues, in
general, and questions of expert opinion and authenticity of art.
Finally, I have the financial incentive (damages in excess of
$100,000), intelligence and education (Harvard College, A.B. cum
laude, 1964; Stanford University, J.D., 1967) and more than ample
financial resources and time to pursue this matter doggedly,
thoroughly, and wisely to a successful conclusion.
BX 14 at 325-26. 9
Respondent had any doubt that Schindler was the artist. Although Respondent explained that he
did not want to ship the painting to Dr. Frödl because it might get damaged in shipment, that
explanation rings hollow given that Respondent had already shipped the painting from D.C. to
London. See Tr. 307-08.
9
We do not rely on Respondent’s letter to Dr. Frödl as a basis for recommending
discipline here because he did not sue Dr. Frödl. However, we quote from it because it adds
19
30.
On March 11, 1994, Dr. Frödl responded to Respondent’s January 1994 letter, and
reiterated that he could not render an opinion about the authenticity of the painting based on
photographs. 10 BX 14 at 360-61. He also said that he had never challenged the authenticity of
the painting; that he never called the painting a fake as Respondent claimed; and that he had not
given Christie’s a binding or non-binding opinion as to the painting’s authenticity. Id. at 361;
see also BX 14 at 98, ¶¶ 9-11 (Dr. Frödl’s declaration, addressing many of these same issues).
Dr. Frödl told Respondent that he would not be available to provide his expertise to Respondent.
BX 14 at 361. This is not surprising, in light of the content and tone of Respondent’s January 24
letter, which Dr. Frödl understood as “an attempt to force [him], by means of threats and insults,
to give a confirmation of authenticity for [Respondent’s] painting.” BX 14 at 98, ¶ 10 (Dr.
Frödl’s declaration).
31.
Although this letter is substantively consistent with Dr. Frödl’s 1986 letter—both
assert that Dr. Frödl cannot give an authenticity opinion without seeing the painting—
Respondent claims that this is a seminal moment in his dispute with Christie’s because it was
then that he realized that Dr. Frödl had not called the painting a fake in March 1993, and thus,
that the Christie’s employees had been lying to him all along. See Tr. 276; RX 14 at 269-70
(Respondent’s First Amended Complaint). Indeed, Respondent alleged in his First Amended
context to the threatening pre-suit letters Respondent sent to Christie’s and Palisades, and lends
support for our conclusion that Respondent’s strategy for getting his way in a dispute was to
threaten aggressive litigation (with all of the attendant monetary and other costs) if the other
party did not accede to Respondent’s demands.
10
At the hearing, Respondent testified that Dr. Frödl’s unwillingness to provide an opinion
without seeing the original was a pretext. Tr. 530, 792, 829 (Respondent contends Dr. Frödl
engaged in “CYA” tactics). Yet, Respondent never explained why Dr. Frödl would need an
excuse for not offering an opinion on Respondent’s painting, nor do we see any reason in the
record.
20
Complaint that he “came to the tentative conclusion on or after March 21, 1994 that [Dr.] Frödl
was in effect telling [Respondent] that Christie’s had been lying to and defrauding [Respondent]
since the middle of March 1993 and perhaps from his very first conversation with [Ms.]
Goldsmith in February, 1993.” RX 14 at 270, ¶ 47.
F.
Respondent Complains to Christie’s
32.
In March 1994, Respondent called Christie’s and spoke with Lord Poltimore, and
alleged that Dr. Frödl and/or Christie’s had called the painting a “fake” and that, because Dr.
Frödl now said that he had not called the painting a fake, “either [Christie’s] had lied or Dr. Frödl
had lied.” BX 14 at 124 (Poltimore Decl. ¶ 31). Lord Poltimore tried to explain to Respondent
that the “problem” for Christie’s was Dr. Frödl’s inability to commit to an opinion, not that Dr.
Frödl called the painting a “fake.” Id. Because Respondent’s calls to Lord Poltimore and others
at Christie’s were not helping to clarify the matter, Lord Poltimore asked Respondent to put his
concerns in writing. Id.; see also Tr. 481-82.
33.
On July 2, 1994, Respondent sent Lord Poltimore a 79-page, single-spaced, letter
with hundreds of pages of attachments, alleging that he had been damaged by Christie’s actions.
BX 14 at 362-440 (letter only). In this letter, Respondent explained that unless Christie’s paid
him $168,000 (in exchange for title to the painting), he would sue Christie’s for compensatory
damages in excess of $265,000 and punitive damages in excess of $1 million. Id. at 362, 373.
Importantly to the issues at hand, Respondent warned Christie’s that its “deep pockets” were
irrelevant because he was a multimillionaire and “there is no way that Christie’s can ‘spend’
[him] out of this case.” Id. at 439 n.17.11 He argued that even assuming the “impossible” and
Christie’s won, it still would lose because it would suffer adverse publicity and incur hundreds of
11
There was no evidence at the hearing as to whether Respondent was, in fact, a
multimillionaire at the time he wrote this letter.
21
thousands of dollars in attorneys’ fees. Id. at 412. Respondent noted that, “[u]nlike England,
you don’t collect your attorney’s fee from me if you win.” Id. Respondent threatened that
“[o]nce I am in a litigation mode, I have every incentive in the world to maximize both my
economic return and the pain to Christie’s in court and before the media; and thus, it is logical
that I shall do so.” Id. at 419; see also id. (“I assure you that I am fully prepared to make a career
of this lawsuit, and an extremely lucrative and psychologically gratifying one at that.”).
Respondent demanded that Christie’s respond to his letter in three weeks. Id. at 362.
34.
Christie’s in-house counsel Maria Ludkin, responded to Respondent’s letter on
July 11, 1994. BX 14 at 441. Ms. Ludkin’s letter reiterated that Christie’s had declined to
auction the painting because Dr. Frödl would not provide an opinion without seeing the painting:
“Dr. Frödl made it clear that he could not give a certain view of the picture until he had the
opportunity of seeing the picture itself . . . . In view of Dr. Frödl’s uncertainty about the picture,
we exercised our right to withdraw the picture from sale and, indeed, from the catalogue which
was about to be printed.” BX 14 at 441. Ms. Ludkin also accurately noted that Respondent had
declined “to make arrangements for the picture to be shipped to Vienna.” Id.
35.
Respondent takes issue with this assertion. Apparently believing that Christie’s
should have affirmatively asked Respondent to send the painting to Dr. Frödl, Respondent argues
that Ms. Ludkin lied in this letter because Christie’s never asked Respondent to send the painting
to Vienna for inspection by Dr. Frödl:
Here is the way I knew that [Ms. Ludkin] was lying
through her eye teeth, “You declined, however to make
arrangements for the picture to be shipped to Vienna for Frödl’s
inspection.” Do you see? They never asked me to do that, and I
never rejected it, not implicitly or otherwise.
Look, there is irrefutable, uncontradicted, unrebutted
evidence in the record that I stated, I stated in my letter of April
22
10th at Exhibit 56, that I was prepared to ship the painting to
Vienna for Frödl or Fuchs. I think I said for both Frödl and Fuchs
for inspection, if need be. I was thinking about all kinds of things.
Tr. 291-92. Respondent characterized Ms. Ludkin’s statement as “the Big Lie No. 2 linchpin
assertion that ([Christie’s] requested or demanded, but Fastov refused or) ‘declined to make
arrangements for the picture to be shipped to Vienna’ (for Frödl’s inspection) and that, as a
result, Frödl was unable to ‘provide a certain view’ or opinion of the painting.” BX 6 at 119, ¶
262. However, Respondent did not send the painting to Dr. Frödl, nor did he direct Christie’s to
do so. Tr. 840-42. Thus, the only logical conclusion to be drawn from these events is the one
Ms. Ludwig drew:
Respondent declined to ship the painting for Dr. Frödl’s in-person
inspection. 12
36.
Importantly, by July 1994, both Dr. Frödl and Christie’s had advised Respondent
that neither Dr. Frödl nor Christie’s had called the painting a fake. Tr. 290, 424-25, 837
(Respondent admits that Dr. Frödl denied stating painting was fake, and based on Ms. Ludkin’s
letter, understood Christie’s was not calling it a fake). Further, Christie’s Solicitor, Ms. Ludkin,
confirmed in writing to Respondent that Christie’s had declined to offer the painting for sale
because Dr. Frödl was unable to offer an authenticity opinion, not because he had called it a fake.
RX 14 at 441. Thus, even assuming that Dr. Frödl and/or Christie’s had once told Respondent
that they believed the painting to be a fake, they had disavowed any such statements in writing.
Moreover, whatever purportedly negative, but disavowed, statements had been made were made
only to Respondent. Respondent has no evidence that Dr. Frödl and/or Christie’s shared their
12
There is no evidence that Respondent ever directed Christie’s to send the painting to Dr.
Frödl for his in-person review. Instead, in August 1997, three years later, Respondent directed
Christie’s to return the painting to him, which it did. BX 14 at 130 (Goldsmith Decl. ¶ 17).
23
purportedly negative opinions of his painting with anyone else.
Tr. 234-35, 838-40
(Respondent).
37.
Although there is no evidence that the value of Respondent’s painting suffered as
a result of the events described above, we are persuaded that Respondent had a colorable claim
against Christie’s for the costs of what he described as his effort to “rehabilitate” his painting,
including obtaining the certificate of authenticity from Dr. Fuchs, and the cost of compiling the
information contained in the letter to Dr. Frödl. 13 See BX 14 at 279 (Respondent’s Amended
Complaint at ¶ 59). All of these expenses were incurred because Respondent believed that Dr.
Frödl had called his painting a fake. Id. According to Respondent’s letter to Lord Poltimore,
these expenses amounted to approximately $3,600. BX 14 at 365-66; BX 6 at 213, ¶ 423. While
this is a relatively small amount, we cannot say that Respondent had no colorable claim for
damages. How he chose to pursue this damage claim is another matter entirely, as is discussed
below.
G.
Respondent’s Substantive Litigation With Christie’s in United States District
Court
38.
On March 21, 1997, Respondent, pro se, filed a 225-page Verified Complaint
against Christie’s in the United States District Court for the District of Columbia, asserting
diversity jurisdiction. Fastov v. Christie’s International PLC, et al., Civil Action No. 97-CA0578, BX 6 at 1. Respondent’s Complaint alleged the following causes of action:
13
Judge Stafford ruled that Respondent had not been damaged by Christie’s conduct.
However, in reviewing Judge Stafford’s opinion, we note that he did not separately address
Respondent’s claim for damages relating to his effort to rehabilitate the painting. We believe it
was reasonably foreseeable that, believing that Dr. Frödl called the painting a fake, Respondent
would attempt to change that opinion; that is, he would attempt to repair the purported defect.
See Bell v. Jones, 523 A.2d 982, 995 (D.C. 1986) (a plaintiff alleging negligent
misrepresentation may recover foreseeable damages).
24
39.
•
Count 1 -- Continuing Fraudulent Misrepresentation and Concealment of
Material Facts (Id. at 7);
•
Count 2 -- Continuing Negligent Misrepresentation and Concealment of
Material Facts (Id. at 216);
•
Count 3 -- “Unfair Trade Practices,” Violations of Various Provisions of
D.C. Code § 28-3904 (Id.);
•
Count 4 -- Breach of the Oral Consignment Agreement and Implied Duty
of Good Faith and Fair Dealing and Breach of an Auctioneer’s Obligations
as an Agent/Fiduciary to A Consignor Arising from such Consignment
Agreement (Id. at 219);
•
Count 4 [sic] -- Negligence and Reckless Conduct (Id. at 222); and,
•
Count 4 [sic] -- Intentional Infliction of Emotional Distress (Id. at 223).
Respondent sought $1,406,500 in damages for the time he spent pursuing his
claim (which allegedly totaled more than 3,000 hours), as well as for emotional distress and
health problems allegedly caused by Christie’s actions. Respondent also requested punitive
damages of $5,625,000, attorneys’ fees, and an order directing Christie’s to fulfill its obligations
to Respondent by providing, in writing, an explanation of why Christie’s consulted with Dr.
Frödl, withdrew the painting from the auction, rejected Respondent’s appeals of the decision of
withdrawal, and later refused to offer his painting in a future auction. BX 6 at 213, 223-24.
40.
Respondent described his claims as two-fold: he contended first, that his painting
was “dead” because Dr. Frödl and/or Christie’s called it a fake and he therefore could not market
it as authentic; and second, that he had spent thousands of hours writing voluminous letters and
other documents, which purportedly caused him emotional distress and/or damages, because
Christie’s told him to “put it in writing.” Tr. 255-58, 278-79, 481-82, 484-85, 487, 508-10. As
Christie’s aptly summarized in its summary judgment motion, Respondent claimed “he relied on
false statements inducing him to consign the Painting through [Christie’s], and that [Christie’s]
made false statements about the authenticity of his Painting that diminished the value of his
Painting and induced him to expend time and effort attempting to rehabilitate the Painting.” BX
25
14 at 55 (Christie’s Memorandum in Support of its Motion for Summary Judgment, at 45). As
discussed above, there is no evidence supporting a claim that the misunderstanding between
Respondent and Christie’s damaged the value of his painting. Moreover, Respondent has not
explained how Christie’s should be held responsible for the alleged emotional distress he
suffered in his effort to resolve his dispute with Christie’s. However, we do understand how
Respondent reasonably believed that Christie’s should be liable to him for the expenses incurred
in attempting to rehabilitate a painting that did not need to be rehabilitated.
41.
Although we find that Respondent reasonably believed that he had a claim against
Christie’s, he litigated the matter in a manner designed to cause Christie’s to incur maximum
costs, not simply to resolve a legitimate dispute.
In considering Respondent’s purpose in
prosecuting the lawsuit, we must consider Respondent’s pre-suit threats. Respondent apparently
believes that his letters are “garden variety” pre-suit letters in which counsel explains the merits
of his or her client’s case and demands a settlement before filing suit: “lawyers write letters
threatening litigation every day. It is just that I write either a lot of letters or very long letters.”
Tr. 712. We disagree that Respondent’s pre-suit correspondence with Christie’s were “garden
variety” litigation letters. Indeed, according to Respondent himself, the July 2, 1994 letter to
Lord Poltimore was “a business proposal,” not “a compromise.” BX 14 at 365. Consistent with
that theme, Respondent devoted a great deal of attention to the costs and benefits of litigation,
ultimately concluding that Christie’s would lose, even if it prevailed on the merits:
Assume the impossible. Christie’s wins. You will have
achieved on behalf of your corporation the ultimate in pyrrhic
victories and done nothing to further Christie’s primary business
purpose, long-term interests and sophisticated image. In fact, you
will have harmed them through adverse publicity. All Christie’s
gets is a little piece of paper from the court which says: “Christie’s
beats Fastov.” Nobody will care except your American attorney
who knows that this piece of paper signifies that his $200K to
26
$300K++ gravy train is over. Unlike England, you don’t collect
your attorney’s fees from me if you win. So, for this worthless
piece of paper you will have laid out good Christie’s cash for all
those attorney’s fees and litigation costs and experienced other
huge revenue losses that I describe in detail, infra.
BX 14 at 412 (July 2, 1994 letter at 51, footnote omitted); see also id. at 419 (“The risks for
Christie’s are Gargantuan [sic] and the benefits are 0 (remember the little piece of paper is all
you get).”); id. at 433 (“there is literally no benefit to Christie’s from [Fastov v. Christie’s,] even
if Christie’s were to win, other than a useless piece of paper that says ‘Christie’s wins’ that
nobody will read except your attorneys and maybe yourself.”).
Throughout the letter,
Respondent repeated his theme that settlement was the only prudent business decision, not
because Respondent would prevail on the merits, but rather, because the costs made litigation
untenable for Christie’s
•
“the cash outlays that Christie’s will, to a legal certainty, have to
make (and will not recover, even if Christie’s wins) to defend the
litigation will be approximately $221.3K (very conservatively
understated) or (more realistically) well in excess of $300K.” BX
14 at 364 (emphasis in original).
•
“the cost disparities between settlement and litigation are so clear
and so great that they force any reasonable businessman to
understand the propriety and necessity of settlement.” Id. at 365.
Respondent also itemized the types of costs that Christie’s would incur if it litigated:
•
attorneys’ fees and costs;
•
lost consignment revenue resulting from bad publicity;
•
lost consignment revenue because Christie’s staff is distracted by
the litigation;
•
loss of consignment revenue from Respondent’s consignments and
referrals; and
•
adverse impact on Christie’s staff morale and staff losses.
See BX 14 at 424-25.
27
42.
Respondent warned Lord Poltimore that, if he bet against Respondent’s
“inclination, will, ability, experience and tenacity” to file and prosecute a suit against Christie’s,
“[i]t will be the worst and most costly conclusion and bet of your life.” BX 14 at 440 (July 2,
1994 letter at 79). Respondent further threatened that “[i]f you and Christie’s force me to go to
war, . . . I will take any and all actions, both within and without the courtroom, that do not violate
the legal rules of professional conduct, necessary to achieve Christie’s unconditional
surrender.” Id. (emphasis added). We cannot dismiss this as garden variety pre-suit hyperbole
because Respondent litigated in a manner that we believe was, in his mind, intended to subject
Christie’s to maximum litigation expense in hopes of bringing about Christie’s unconditional
surrender. Indeed, Respondent threatened that if Christie’s adopted what he termed “the classic
defense strategy of constant confrontation, disruption and delay,” Christie’s would be “play[ing]
right into [Respondent’s] hands and would be met with similar confrontational and disruptive
tactics.” Id. at 426.
43.
Fastov v. Christie’s was initially assigned to the Honorable Paul Friedman. BX 5
at 1. On September 11, 1997, Christie’s moved to dismiss the Complaint under Fed. R. Civ. P.
8(a) and 12(b)(6). BX 8 at 1. On October 8, 1997, Timothy Russell, Esquire, entered his
appearance as Respondent’s counsel. BX 5 at 5. On October 27, 1997, Respondent, with Mr.
Russell’s assistance, filed a 45-page Amended Complaint.
Id. at 5; BX 14 at 243-90.
Respondent’s Amended Complaint included the same claims and demanded compensatory
damages in excess of $100,000, punitive damages of $5,000,000, treble damages under the D.C.
Consumer Protection Procedures Act, and attorneys’ fees and costs. BX 14 at 278-90.
44.
On December 2, 1997, Christie’s moved to dismiss the Amended Complaint,
arguing that that Respondent had failed to state a claim and that his damages theories were
28
frivolous. BX 10. On February 27, 1998, Judge Freidman denied the motion to dismiss the
Amended Complaint. BX 11.
45.
Although Mr. Russell continued to be listed as Respondent’s counsel until
September 2000, Respondent held himself out to the District Court, and acted as, co-counsel.
See, e.g., BX 13 at 6 (noting Respondent’s argument that certain restrictions in a protective order
should not apply to him because he “serves as his own co-counsel.”). Among other things,
Respondent (i) deposed officials and employees of Christie’s (RX 20d; BX 14 at 307; Tr. 851
(Respondent)), (ii) prepared and filed motions (see, e.g., RX 11; see also BX 16 (Respondent
listed as counsel, along with Mr. Russell on opposition to summary judgment motion)); and, (iii)
wrote letters to opposing counsel (see, e.g., RX 12 (Mr. Russell wrote one-page cover letter
dated April 23, 1998, for Respondent’s 35-page Discovery Memorandum for Christie’s counsel);
see Tr. 847-53 (Respondent admits he acted as co-counsel, but contends Mr. Russell had the final
say).
46.
Once the case entered active litigation, Respondent sought discovery that
exceeded the scope of any reasonable dispute that he might have had with Christie’s, which
should have focused on what he was told about the reason that Dr. Frödl did not give an opinion.
For instance, he deposed the Chair of Christie’s in New York, who, even Respondent concedes,
had nothing to do with Respondent or the events giving rise to his lawsuit. Tr. 768; see also RX
12 at 1 (Respondent asserts that “Christie’s counsel and their clients are very much responsible
for the depth, length and detail manifested by Fastov’s discovery requests.”).
47.
Respondent also engaged in unnecessary and extensive motions practice, which
appears to be among the “confrontational and disruptive tactics” Respondent threatened in his
March 1993 letter to Lord Poltimore. See supra, ¶ 42. For example, when Christie’s objected to
29
Respondent’s burdensome requests for irrelevant information and documents, Respondent filed a
motion to compel, which Magistrate Judge Robinson denied.
BX 5 at 8 (Docs. 41, 47).
Respondent then filed a motion for reconsideration supported by a memorandum and a
supplemental memorandum. BX 5 at 9-10 (Docs. 50, 52, 59, 68). While his motion for
reconsideration was pending, Respondent filed another motion, arguing that the crime/fraud
exception applied to eliminate Christie’s attorney-client privilege and work-product protections,
resulting in still more briefing.
Id. at 9-10 (Docs. 54, 63).
The District Court denied
Respondent’s motion for reconsideration and his crime/fraud motion. Id. at 11 (Docs. 70-71);
see also BX 39 at 5-7. Christie’s incurred hundreds of thousands of dollars in attorney’s fees in
discovery and motions practice to defend against Respondent’s claims. BX 39. 14
48.
On May 1, 2000, Christie’s sought summary judgment, arguing that Respondent’s
claims were barred by the Statute of Limitations and that Respondent had suffered no damage.
BX 14. On June 20, 2000, Respondent, with counsel, filed a 59-page opposition memorandum
to the summary judgment motion, attaching a 90-page declaration, a 461-page statement of
disputed and undisputed facts, and three volumes of exhibits totaling 1,500 pages. See BX 15;
Tr. 850 (Respondent); BX 30 at 75-76 (Respondent seeks to explain why documents so lengthy).
On June 27, 2000, Judge Friedman ordered that Respondent’s opposition would not be accepted
for filing. The Court found that Respondent’s filing was “an abuse of the litigation process.”
BX 15 at 1. The Court stated that Respondent’s “well-documented proclivity in this case to
engage in obstructionist litigation tactics at the expense of the Court, opposing counsel, and even
14
We do not mean to suggest that discipline should be imposed on lawyers who file
expansive discovery requests, and file motions to compel, and motions for reconsideration, and
surreplies, and all of the other tools Respondent used in this case. The problem here is that we
find that Respondent used legitimate discovery tools and the ability to file motions for no
purpose other than to harass Christie’s.
30
his own attorneys will be tolerated no longer.” Id. at 2. Judge Friedman instructed Respondent
to re-file his opposition, and imposed page-limitations on his supporting memorandum,
declaration, statement of disputed material facts, and exhibits. Id. Judge Friedman also put
Respondent on notice that “from the date of this Order forward, [Respondent] will be personally
fined and sanctioned every time the Court determines that he has abused the litigation process—
regardless of whether he is represented by counsel or is proceeding pro se.” Id. at 3.
49.
On July 7, 2000, Respondent, as co-counsel, filed his opposition to Christie’s
summary judgment motion. BX 16. Christie’s filed a reply on August 4, 2000. BX 17. On
August 8, 2000, Respondent, pro se, filed a 45-page memorandum in support of a motion to file
a 25-page surreply. RX 15. At least two of the documents attached to the memorandum
contained additional factual and/or legal argument. See, e.g., RX 15a and 15d.
50.
On August 29, 2000, Judge Friedman ordered Respondent’s pro se motion and
attachments struck from the record, explaining that “[n]o motion for leave to file requires 45
pages of argument and 40 pages of exhibits.” BX 18 at 1. The Court concluded that “[s]uch a
filing, particularly in light of previous warnings to Plaintiff, is an abuse of the litigation process
and a waste of the Court’s time.” Id. Judge Friedman noted that Respondent was previously
admonished for his “tendency to flood the Court and opposing counsel with paper,” and stated
that Respondent’s “apparent refusal to heed the advice of his counsel would be tolerated no
longer.” Id. at 1-2. Judge Friedman found that “the proposed surreply appears to be for the
purpose of circumventing the limit placed on [Respondent’s] earlier filings by this Court’s Order
of June 27, 2000,” but stated he would postpone consideration of sanctions against Respondent
(and his then-counsel) until after he ruled on Christie’s summary judgment motion. Id. at 2-3.
31
51.
On September 8, 2000, Respondent renewed his motion to file a surreply. See
RX 16. On that same day, Mr. Russell filed a motion to withdraw, which the District Court
granted on September 15, 2000. BX 5 at 1, 13-14.
52.
By order filed November 16, 2000, Judge Friedman granted Respondent’s motion
for leave to file a surreply. It is not clear why Judge Friedman changed his mind on this issue.
Although he allowed Respondent to file a surreply, Judge Friedman found it “necessary to place
explicit restrictions on such a filing based on [Respondent’s] tendency to skirt court orders by
submitting unreasonably voluminous filings and his history of vexatious conduct and
questionable litigation tactics.”
BX 19 at 1.
Judge Friedman ordered that Respondent’s
memorandum not exceed 25 pages, and gave specific instructions on the font style, font size, and
spacing of the memorandum and accompanying exhibits, including an instruction that any
declaration by Respondent not exceed 20 pages.
Id. at 2-3.
Judge Friedman reminded
Respondent that, pursuant to the June 27, 2000 order, he would be personally fined and
sanctioned for any abuse of the litigation process. Id. at 3.
53.
On January 19, 2001, Respondent filed his surreply. RX 20. Respondent’s
purported attempt to comply with the literal letter of Judge Friedman’s order demonstrates
Respondent’s apparent contempt for the rules of court.
Although the memorandum was
technically 25 pages long, the majority of the text was placed in footnotes, which, according to
the Court’s Order, could be single spaced. Indeed, several pages of the 25 page brief contained
five or less lines of double spaced text, including two pages that were comprised entirely of
footnote text. See BX 20 at 9-12, 14-15, and 29. Respondent also dramatically reduced the size
of the margins—which were not addressed in the November 16 Order—to less than one half of
an inch wide, rather than the much larger margins Respondent had used in prior filings.
32
Compare BX 20 with BX 6, and 7. In the first sentence of the memorandum, Respondent
complained about the restrictions placed on his filing, and “in order to deal with such limitations
and proscriptions, [Respondent] incorporate[d] by reference, as if set forth verbatim at length”
three other documents that Respondent had prepared. BX 20 at 6. Respondent attached to the
surreply 25 numbered exhibits, as well as his 25-page declaration, which exceeded the 20-page
limit set by the District Court. 15 Id. at 58-59 (Table of Exhibits; Exhibit 12 was itself comprised
of 18 separate exhibits). As was true of a number of Respondent’s filings, the attachments or the
exhibits included documents prepared by Respondent containing additional or expanded
arguments. See, e.g., RX 17j (an exhibit to BX 20).
54.
In its response, Christie’s complained that Respondent was continuing to violate
court rules and orders, including not only those regarding page limitations, but also those that
prohibited filing duplicative exhibits and the inclusion of additional personal statements and/or
arguments in attachments. BX 21 at 1. Christie’s argued that it was “simply unfair to require [it]
to have to respond repeatedly to submissions that violate the rules for orderly and just
adjudication.” BX 21 at 5.
55.
In February 2005, Fastov v. Christie’s was reassigned to Judge William Stafford,
Jr., of the United States District Court for the Northern District of Florida.
BX 22.
On
December 7, 2005, Judge Stafford advised the parties that he would take Christie’s motion for
summary judgment under advisement on January 16, 2006, and that any additional evidence or
argument should be submitted before then. BX 23.
15
Respondent testified that he submitted a 25-page declaration because by mistake, he
believed that the 25-page limit applied to the brief and the declaration. Tr. 539-40. We see no
reason to doubt Respondent on this point. As such, we do not find that the overly long
declaration serves as the basis for a Rule violation; however, Respondent’s failure to follow
Court instructions does bear on his ability to practice law.
33
56.
On January 16, 2006, Respondent filed a 38-page response, with a declaration
appending 12 documents. BX 24. On February 19, 2006, Respondent sent Judge Stafford a
lengthy letter in response to the submission by Christie’s. RX 19 (includes first 14 pages of
Respondent’s letter). 16
57.
On February 22, 2006, Judge Stafford granted Christie’s motion for summary
judgment. BX 26 (as corrected on February 27, 2006). Judge Stafford ruled that Respondent’s
breach of contract and tort claims were time-barred. With regard to the breach of contract claim,
Judge Stafford concluded that it was untimely because the three-year statute of limitations period
began to run no later than May 20, 1993, when Christie’s declined to include the painting in its
catalogue and sale. BX 26 at 16-18. Judge Stafford found that Respondent’s tort claims were
also barred by the three-year statute of limitations as there was “ample record evidence that
[Respondent] either knew or, with the exercise of reasonable diligence, should have known that
he suffered an injury as a result of [Christie’s] alleged tortious conduct more than three years
before he filed suit.” Id. at 19.
58.
Judge Stafford further stated that even if Respondent’s claims were timely, they
would fail on the merits. Id. at 19. Judge Stafford found that Respondent had not submitted any
evidence to support his claim for intentional infliction of emotional distress. Id. at 20. Judge
Stafford further found that the D.C. Consumer Protection Procedures Act was inapplicable to
Christie’s, as there was nothing in the record to support Respondent’s contention that this law
was intended to operate extraterritorially. Id. at 20-22.
16
In addition to sending a letter to Judge Stafford, Respondent also wrote letters to Judge
Friedman and D.C. Circuit Judge Tatel. Pursuant to Local Civil Rule 5.1(b), except when
requested by the judge, “correspondence shall not be directed by the parties or their attorneys to
a judge, nor shall papers be left with or mailed to a judge for filing.” Respondent testified that he
was unaware of this rule (Tr. 537-38). While we do not believe that Respondent intentionally
violated the rules by sending these letters, counsel should be aware of the court rules.
34
59.
Judge Stafford also found that Respondent failed to show that he suffered
damages as result of conduct by Christie’s, and stated that Respondent’s “claims to damages
defy all credulity; indeed, they make sense only when viewed in context of his open threats to
achieve ‘Christie’s unconditional surrender.’” Id. at 25. Judge Stafford went on to state:
“Without any credible evidence of damages, [Respondent] has grasped at the flimsiest of straws
in an attempt to support his otherwise unsupported, unmeritorious claims, claims that were—in
the court’s view—initiated in bad faith with intent to subject Christie’s to ‘the worst and mostly
costly’ litigation in Christie’s experience.” Id. at 25 (emphasis in original).
H.
Merits-Based Proceedings in the United States Court of Appeals for the D.C.
Circuit
60.
On March 30, 2006, Respondent appealed Judge Stafford’s order to the United
States Court of Appeals for the District of Columbia Circuit (“D.C. Circuit”). BX 27. On April
23, 2006, after Christie’s moved the D.C. Circuit to dismiss the appeal as untimely (BX 34 at 4),
Respondent filed with the District Court a 19-page motion for an extension of time to file his
Notice of Appeal, attaching a six-page declaration and five exhibits. BX 28. Among other
things, Respondent contended that his notice of appeal was timely, and the motion for an
extension of time was merely “protect[ive].” BX 28 at 5.
61.
On June 8, 2006, Judge Stafford ruled that Respondent’s notice of appeal was
untimely because it was filed more than 30 days after the final judgment was issued. BX 32.
Judge Stafford noted that it was disingenuous for Respondent, “a self-professed ‘sophisticated
litigator,’ . . . a long-time member of the District of Columbia Bar and former ‘Deputy Counsel
in charge of a major U.S. Government agency litigation unit for over 13 years,’” to assert that he
was “‘a pro se litigant with no practical knowledge of the practices and law surrounding filing
Notices of Appeals or the other nuances of appellate practice.’”
35
BX 32 at 2-3 (quoting
Respondent). On August 3, 2006, the D.C. Circuit granted Christie’s motion to dismiss as
untimely Respondent’s appeal of the February 22, 2006 order. BX 35. Respondent then filed a
petition for rehearing, which the D.C. Circuit denied on November 13, 2006. BX 34 at 5.
62.
On June 19, 2006, Respondent filed a Notice of Appeal of the District Court’s
June 8, 2006 order. BX 33. On April 10, 2007, the D.C. Circuit issued its decision affirming the
District Court’s order of June 8, 2006, and denying Respondent’s motion for additional time to
file an appeal. BX 37. Respondent filed a petition for rehearing and rehearing en banc, together
with two “supplement[al]” filings. BX 36 at 5. On June 26, 2007, the D.C. Circuit denied
Respondent’s petition. Id.
I.
Fee-Related Proceedings in United States District Court
63.
On April 6, 2006, Christie’s filed with the District Court a Motion for Attorneys’
Fees, pursuant to 28 U.S.C. § 1927, arguing that Respondent had initiated the lawsuit in bad faith
and engaged in vexatious tactics.
BX 29 at 6.
On April 18, 2006, Respondent filed an
opposition to Christie’s Motion for Attorney’s Fees, which included a 45-page memorandum, a
supporting 26-page declaration, and hundreds of pages of exhibits that were too “bulky” to be
filed electronically.
BX 30 at 79.
As was true of many of Respondent’s filings, the
memorandum included numerous and lengthy footnotes, which were single-spaced (as was some
of the text), presumably in response to the court’s page limitations. Further, Respondent’s
declaration and many of the exhibits attached thereto included additional or expanded arguments
and citations—a practice that Respondent regularly employed to evade the page limitations. See
BX 30, RX 24E, BX 47 at 53-66. In response to Christie’s nine-page reply (BX 31), Respondent
filed a motion to file a 24-page surreply (RX 22a-c), which motion the District Court denied on
May 23, 2006. BX 5 at 17 (Doc. 131).
36
64.
On March 14, 2007, Judge Stafford granted Christie’s Motion for Attorneys’
Fees, finding that “the record amply demonstrates that [Respondent] first initiated, then
prosecuted this lawsuit in bad faith for the purpose of harassing Defendants. His egregious
behavior, which unreasonably and vexatiously multiplied these proceedings, clearly warrants the
imposition of sanctions under [28 U.S.C.] section 1927 as well as under the Court’s inherent
authority.” BX 38 at 5. Judge Stafford cited Respondent’s initial 79-page (single-spaced) letter
to Christie’s with hundreds of pages of attachments as evidence of Respondent’s motive and
intent in filing the lawsuit. Id. at 1-3. As examples of Respondent “abusing the litigation
process,” Judge Stafford cited Respondent’s voluminous pleadings, including his 225-page
complaint and his initial opposition to Christie’s motion for summary judgment. Id. at 3. Judge
Stafford noted that earlier in the litigation the Court had warned Respondent that he would
personally be fined and sanctioned for abusing the litigation process. Id. at 3-4. Judge Stafford
referred the matter to a Magistrate Judge to determine the amount due to Christie’s. Id. at 5.
65.
On April 24, 2007, counsel for Christie’s submitted a 13-page declaration in
support of its claim for $564,102.86 in legal fees and $66,030.46 in expenses incurred through
summary judgment briefing. BX 39 at 11-12.
66.
In response to Christie’s counsel’s declaration, on May 8, 2007, Respondent filed
a 45-page memorandum, with a 48-page declaration that included eight attachments. RX 24A,
RX 24B. The first attachment was a 56-page document in which Respondent discussed in great
detail the cases on which he relied in his 45-page memorandum. RX 24E.
67.
On September 7, 2007, after receiving briefs from Christie’s and Respondent,
Magistrate Judge Kay scheduled a December 18, 2007 hearing on the “Calculation of Attorneys’
Fees.” BX 5 at 18-19. On December 11, 2007, Respondent filed a 49-page “Supplementation”
37
of his testimony and argument to be presented at the December 18, 2007 hearing. BX 41.
Respondent attached a 60-page declaration (RX 25b), and exhibits, which included a 5-page
document that argued that Judge Stafford failed to apply “basic principles of summary judgment
law,” and a 10-page document that contained “a more extensive discussion” of the legal
principles discussed in the “Supplementation.” See e.g., RX 25d and RX25e.
68.
At the December 18, 2007 hearing, Respondent provided the Magistrate Judge
with a 106-page declaration (RX 26), and numerous exhibits (RX 26a-i). In the declaration and
exhibits and in his presentation at the hearing, Respondent again sought to reargue the merits of
his claims against Christie’s. BX 43 at 3 n.3 (Magistrate’s Report and Recommendation).
69.
On December 29, 2007, while the fee issue was pending before Magistrate Judge
Kay, Respondent sent Judge Friedman a 14-page, single-spaced letter requesting that he
reassume jurisdiction over the case, and attaching an additional 23 pages of Respondent’s
summaries of the evidence. BX 42 at 2-15. In this letter, Respondent criticized Judge Stafford’s
orders (id. at 3-4), accused Christie’s counsel of presenting a defense “predicated on perjured
testimony and fabricated documents” (id. at 4), contended that Christie’s was not entitled to fees
and costs (id. at 3-8), and reiterated his arguments about the purported merits of his claims
against Christie’s (id. at 8-15). On January 4, 2008, Magistrate Judge Kay notified the parties
that Judge Stafford was retaining jurisdiction over the case. BX 5 at 19 (Doc. 145).
70.
On January 24, 2008, Magistrate Judge Kay issued his Report and
Recommendation, finding that Christie’s request for $630,043.32 in fees and expenses was
reasonable, and that the District Court could order Respondent to pay that amount as a sanction
pursuant to 28 U.S.C. § 1927. BX 43 at 11. However, Magistrate Judge Kay recommended that
the Court impose a sanction of only $110,000, citing Respondent’s finances. Id.
38
71.
On February 11, 2008, Christie’s filed “conditional” objections to Magistrate
Judge Kay’s recommendation, stating that it “would be prepared to acquiesce in Judge Kay’s
exercise of discretion to award it only $110,000, and not the full amount which Christie’s
actually incurred and which he found to be reasonable—but only if [Respondent] likewise
accepts Judge Kay’s Report and Recommendation and does not seek to have it reduced.” BX 44
at 2.
72.
Respondent did not accept Magistrate Judge Kay’s recommendation.
On
February 12, 2008, Respondent filed a 45-page memorandum in support of his objections to
Magistrate Judge Kay’s recommendation.
This filing included 77 footnotes and “bulky
exhibits,” and reargued the merits of his claims against Christie’s and the District Court’s order
awarding fees as a sanction. BX 45.
73.
Between February 22 and April 9, 2008, Respondent made four more filings in
response to Magistrate Kay’s Report and Recommendation.
•
On February 22, 2008, Respondent filed a 44-page opposition to
Christie’s conditional acceptance of Magistrate Judge Kay’s
recommendation. BX 46. This document is entirely irrelevant
because, as Respondent himself notes on the first page of his brief,
he had already objected to Magistrate Judge Kay’s
recommendation. BX 46 at 5.
•
On March 10, 2008, Respondent filed a 45-page reply to Christie’s
four-page response to Respondent’s objections (see RX 7). BX 47.
Very little of the 45-page Reply actually responded to the few
points contained in Christie’s brief opposition. Respondent also
attached a 14-page declaration, comprised primarily of additional
argument. BX 47 at 53-66.
•
On March 19, 2008, Respondent filed a 41-page memorandum
(replete with long footnotes and single-spaced text) in support of a
motion requesting that a hearing be held, and that the Clerk be
directed to email a copy of all Court orders to Respondent. BX 48.
Respondent sought to be notified by email because he did not
receive notice of filings via PACER. See id. at 48.
39
•
74.
On April 9, 2008, Respondent filed a 25-page Reply to Christie’s
three-page response to his motion for a hearing (see RX 8). BX
49. 17
On April 25, 2008, Judge Stafford adopted Magistrate Judge Kay’s Report and
Recommendation, except for the amount to be awarded. BX 50. Judge Stafford awarded the
entire $630,043.32 to Christie’s as a sanction for Respondent’s “bad faith, vexatious and
oppressive conduct in this case.” BX 50 at 7. Judge Stafford noted that in submitting his
objections to the Magistrate Judge’s report, Respondent had continued “to engage in the very
conduct that, in part, has resulted in sanctions being awarded against him.” Id.
75.
Prior to the hearing, Bar Counsel asked that we give preclusive effect to Judge
Stafford’s rulings. We declined that request because we wanted to hear the evidence ourselves
and make up our own minds as to Respondent’s conduct. Having listened to the evidence
(including Respondent’s testimony), we agree that Respondent abused his status as a lawyer by
engaging in unnecessary discovery and motions practice solely to make Christie’s give up, in
order to avoid Respondent’s continued onslaught of paper and the attendant expense.
J.
Fee-Related Proceedings in the D.C. Circuit
76.
On May 21, 2008, Respondent filed a notice of appeal of the judgment ordering
sanctions. BX 51. On June 3, 2008, Respondent filed a motion for a stay of execution, which
included a 45-page memorandum that attached and referred to voluminous exhibits. BX 52.
77.
On August 7, 2008, Judge Friedman, who was reassigned to the case, denied
without prejudice Christie’s motion for entry of condemnation judgment, stating that Christie’s
could renew the motion after the resolution of Respondent’s appeal. BX 53 at 3. Judge
17
Having reviewed both of these filings, we see no need for Respondent to have submitted
such a lengthy Reply.
40
Friedman also stayed execution of the judgment until Respondent’s appeal was resolved or until
further order of the District Court, and ordered that Respondent could not withdraw, liquidate, or
otherwise dispose of assets to be used to pay the sanction. Id.
78.
On April 20, 2009, the D.C. Circuit affirmed the District Court’s April 25, 2008
fee decision, holding that the District Court’s finding that Respondent had engaged in bad faith
litigation was not “clearly erroneous,” and that the District Court had acted within its discretion
in ordering Respondent to pay the full amount requested by Christie’s. BX 55.
79.
On April 20, 2009, Christie’s renewed its motion for entry of condemnation
judgment. BX 56.
In response, Respondent filed a 40-page opposition, raising numerous
objections, including that the motion was premature given Respondent’s plans to file petitions
for rehearing and rehearing en banc with the D.C. Circuit, and a petition for a writ of certiorari
with the United States Supreme Court. BX 57 at 7.
80.
In response to Christie’s reply to his opposition (BX 58), Respondent sought to
file a surreply. BX 5 at 22 (Doc. 179). The District Court denied Respondent’s motion to file a
surreply. Id. at 23 (Doc. 180).
81.
On July 16, 2009, the D.C. Circuit denied Respondent’s petitions for rehearing
and for rehearing en banc. BX 59 at 5-6. Respondent was apparently unaware of this ruling on
July 20, 2009, when he filed with the D.C. Circuit a motion to supplement his petitions for
rehearing and rehearing en banc, together with a 15-page “supplement” and an addendum.
BX 62 at 49-68; BX 60 at 5. On July 29, 2009, the D.C. Circuit denied Respondent’s motion to
supplement as moot. BX 60 at 5.
82.
In the interim, Respondent sent the Honorable David Tatel, Chief Judge of the
D.C. Circuit, a single-spaced, 24-page letter dated July 27, 2009, contending, among other
41
things, that the D.C. Circuit had improperly denied his appeal and should reconsider its decision.
BX 62 at 69-93.
83.
On July 31, 2009, the D.C. Circuit issued its mandate to the District Court.
84.
On August 5, 2009, Respondent filed with the District Court a 44-page petition to
BX 61.
“reconsider [the Court’s] apparent grant of Christie’s motion to execute on the judgment.”
BX 62.
The petition included more than 50 pages of exhibits, including Respondent’s
supplement to his petition for rehearing and for rehearing en banc and letter to Judge Tatel. Id.
at 46-102.
85.
In orders filed August 17, 2009, the District Court denied Respondent’s motion
for reconsideration and granted Christie’s motion for entry of condemnation judgment against
funds in Respondent’s brokerage accounts in the amount of $630,043.32. BX 64-66.
86.
On October 14, 2009, Respondent filed a petition for a writ of certiorari with the
United States Supreme Court. RX 32-33. The Supreme Court denied his petition on December
7, 2009. BX 67.
II.
Facts Relating to Fastov v. Palisades
A.
The Underlying Events
87.
Palisades is a private, non-profit corporation that operates a recreational pool and
tennis facility in Montgomery County, Maryland.
Tr. 64-66.
Palisades is governed by a
volunteer Board of Directors of between 13 and 15 permanent members (including a President,
Vice President, Secretary, and Treasurer). Tr. 65-68; BX 71 at 15 (Bryan Affidavit ¶¶ 2-3).
From 2000 until 2006, Jeffrey Bryan served as Palisades’ President, and was responsible for
42
handling membership issues and dealing with complaints from or about members and staff. BX
71 at 15 (Bryan Aff. ¶¶ 1-2); see Tr. 68-70.
88.
Respondent began using Palisades’ recreational facilities in approximately 1975,
and became a permanent Palisades member in 1981. BX 69 at 2, ¶ 2. In June and early July
2004, Mr. Bryan and other Palisades Board members received a number of complaints about
Respondent, including that he made inappropriate, sexually suggestive comments to teenage pool
staff, and stared at and touched them in ways they found unwelcome and inappropriate;
interfered with the swim team practices; walked behind the diving boards during diving
competitions; used profanity to and around young children; and, engaged in threatening and
aggressive behavior when he was requested to refrain from certain conduct. Tr. 71-75, 152-54,
160-61; BX 71 at 17-19 (Bryan Aff. ¶¶ 6-9); id. at 54 (Grinker Aff. ¶ 7).
89.
Upon receiving the complaints, Mr. Bryan spoke to those who had witnessed
and/or complained about Respondent’s conduct, and consulted with the other Board members
regarding the Board’s response to these complaints. Tr. 75-76.
90.
On July 6, 2004, Mr. Bryan telephoned Respondent to discuss his conduct,
explaining the nature of the complaints, including Respondent’s alleged inappropriate conduct
involving female staff and other Palisades members. Mr. Bryan instructed Respondent to refrain
from further confrontational behavior with staff and members and not to attempt to confront or
elicit information from those who had lodged complaints with the Board. Tr. 76-78, 152-54,
158; BX 71 at 18-19 (Bryan Aff. ¶ 9).
91.
The very next day, Respondent confronted one of the teenagers who had
complained about him, and told her that he did not believe that he had done anything wrong.
BX 71 at 19 (Bryan Aff. ¶ 10). Respondent pointed his finger at the teenager and ultimately
43
backed her into a corner of the pool, at which point a parent interrupted the exchange. Tr. 78-79,
165; BX 71 at 19 (Bryan Aff. ¶ 10); see also BX 71 at 43-44 (¶ 3), and 63-64 (¶ 14) (affidavits of
Board member who witnessed Respondent’s confrontation of teenager and affidavit of teenager,
respectively); see Tr. 636-37, 758-59 (Respondent has “dim recollection” of approaching
teenager; event “ring[s] a vague bell”).
92.
Upon learning that Respondent had confronted the teenager, Mr. Bryan again
consulted with the other Board members, and with their consent, wrote to Respondent on July
13, 2004, reiterating that Respondent’s offensive and abusive conduct would not be tolerated.
Tr. 79-81; BX 71 at 20 (Bryan Aff. ¶ 11). In that letter, Mr. Bryan instructed Respondent not to
use abusive language and/or physically intimidate other pool members and to refrain from
behavior that “is perceived to be leering, sexually intimidating, or creating a sexually hostile
environment which serves to intimidate and frighten our female members and staff.” BX 71
at 39. Mr. Bryan further instructed Respondent not to touch anyone other than his own family
members. Id. Mr. Bryan warned Respondent that if he violated these instructions or failed to
comply with the staff’s instructions concerning pool rules, safety, and facility regulations, his
membership could be suspended or terminated, after a hearing. Id.; Tr. 79-81, 158.
93.
The July 2004 letter was discussed only among the Board members, and was sent
to Respondent only. Tr. 81, 86, 115-16; BX 71 at 20 (Bryan Aff. ¶ 11); see also Tr. 568, 687-88,
736-37 (Respondent admits that he has no evidence that the letter was circulated to anyone other
than Palisades Board members and, thereafter, their counsel in the litigation).
94.
After receiving the July 2004 letter, Respondent sent Mr. Bryan a series of
lengthy, derogatory, and threatening letters, demanding that Palisades provide written responses
to detailed requests for information, including but not limited to:
44
(1)
the name, address, telephone number, e-mail address and other
information about every person who had complained about his
conduct (BX 69 at 59);
(2)
the “evidentiary particulars” of the “11 types of instances”
Respondent contended were addressed in the letter, including the
part of the pool area where it occurred, the date and time, any facts
or circumstances “that would have or could have justified,
mitigated, and/or exonerated, in whole or in part” Respondent’s
communication or action, and to provide detailed answers to
numerous questions with respect to each of the “11 types of
instances” Respondent identified (id. at 63); and,
(3)
to define various terms used in the July 2004 letter, including
“abusive language,” “profane language,” “physical intimidation,”
and “hostile airs” (id. at 64).
Respondent also demanded numerous documents, including a) all documents that the Board had
read, relied on, or used, including internal communications among Board members relating to or
reflecting the matters addressed in the July 2004 letter; and, b) all communications between the
Board and the people who complained about or provided information relating to Respondent’s
actions. BX 69 at 130-31, n.44.
95.
Respondent also demanded that Palisades rescind the July 13, 2004 letter and that
Mr. Bryan “apologize to [Respondent] for [Mr. Bryan’s] overreaching and factually inadequate
and insupportable [sic] predicates for” the letters to Respondent. Id. at 82-83; see also id. at 88.
In subsequent letters, Respondent also demanded that Palisades pay him $250 per hour (which
Respondent claimed was his “discounted hourly rate”) for the time he had spent writing letters to
the Board. BX 69 at 97, 105; see also Tr. 750-52 (Respondent admits he asked for money in his
letters, but contends he did not do so in his settlement demands).
96.
In his letters, Respondent threatened that he would sue Mr. Bryan and the other
Board members if they did not comply with Respondent’s demands. BX 69 at 60, 67-68, 76-77,
87-90, 97-99. Respondent claimed that he was “a retired, but very experienced, tenacious,
45
vigorous and successful litigator,” that he had a 95-99% success rate in major lawsuits, and that
he could devote 24 hours a day to pursuing the matter. Id. at 90; see also id. at 119, 136
(Respondent described himself as “still highly motivated by the prospect of and likes and relishes
taking on, [sic] abusive, arrogant, arbitrary and capricious corporations and their officers and
punishing them on behalf of the poor slobs that the corporation bullies and screws on a daily
basis”). Respondent told the Board members that they would have to spend hundreds of hours
and tens of thousands of dollars if they chose to litigate with him. See id. at 89. He also
threatened to publicize his claims against them in order to ruin their reputations, humiliate and
embarrass them, and impose further damage. See id. at 97-99. Much as he threatened Christie’s
and Dr. Frödl, Respondent contended that, even if Palisades and the Board members prevailed in
the litigation, they would receive only a worthless piece of paper and would never recover the
tens of thousands of dollars they spent in legal fees. Id. at 90 (“Remember that what you will
win with either retained counsel or your [sic] acting as your own counsel, will be a piece of
paper, called a judgment, that, in effect, states that you were right and I was wrong.”)
97.
The Board members understood that Respondent was threatening them
personally, as well as Palisades. Tr. 173-74 (Bryan); BX 71 at 48 (Neudorfer Aff. at ¶ 15). The
Board members declined to respond to Respondent’s numerous and escalating demands, and
resolved to stand by their original letter. Tr. 83-84. The Board saw no need to respond to
Respondent’s demands for information because he had not lost any benefit or privilege of
membership, nor had there been any further complaints about the conduct at issue. Tr. 86, 105,
192-93; BX 71 at 20-21, 23 (Bryan Aff. ¶ 13, 21).
98.
On September 9, 2004, Mr. Bryan, with the consent of the Board, sent
Respondent a follow-up letter advising Respondent that he had forwarded Respondent’s three
46
letters to the Board, and that the Board was not going to pursue the matter any further. Mr.
Bryan closed by wishing Respondent a pleasant winter season. BX 71 at 40; Tr. 85-86.
99.
This did not end the matter for Respondent. Indeed, according to Respondent’s
Complaint against Palisades, after receiving Mr. Bryan’s September 9, 2004 letter, Respondent
sent a letter on September 15, 2004
in which [Respondent] criticized Defendant Bryan’s letter of
September 9, 2004. Among other things, [Respondent] asked
Defendant Bryan for information concerning all of the particulars
of who, what, when, why and how, etc. of the actions that were
taken, documents used or generated, or inactions and omissions
made by Bryan and the Palisades Board of Directors with regard to
the content and justification for [the letters sent to Respondent.]
BX 69 at 84, ¶ 71. Respondent also reiterated his demands for an apology and his threats to sue
Palisades, Mr. Bryan, and others if they did not comply. BX 69 at 84-92; see also BX 69 at 8184 (Respondent’s September 13, 2004 letter, sent before Respondent received Mr. Bryan’s
September 9 letter).
On September 24, 2004, Mr. Bryan sent Respondent another letter,
reiterating that the Board saw no need to pursue the matter further. BX 71 at 41; Tr. 87 (Bryan);
BX 69 at 92-93.
100.
In response, Respondent pursued his demands with even more vigor and
vituperation. His September 30, 2004 letter repeated threats to sue Palisades and the Board
members and thus expose them to time-consuming and expensive litigation. BX 69 at 93-103.
Specifically, Respondent threatened that he would:
•
take approximately 50-60 depositions, including Mr. Bryan, every
Board member, all Palisades employees during 2004, and some
pool members (id. at 97-98);
•
seek to inspect Palisades’ records going back for several years (id.
at 98);
•
do his best to ensure that the trial garnered adverse publicity for
Mr. Bryan, the Board members, and Palisades (id.); and,
47
•
101.
“make every effort” to prevent Palisades from paying for counsel
representing Mr. Bryan and other members of the Board in their
personal capacities (id.).
As he had done in other letters, Respondent threatened Mr. Bryan individually:
I shall go after you in the litigation most assiduously and
tenaciously. When I get finished with you, no one of any
competence, who is aware of your performance as the Palisades’
CEO in this mess, should hire you or The Bryan Consulting Group
LLC to consult on any matter of consequence regarding business
management. “Your large staff that you employ” will probably
have to be curtailed significantly. I shall maximize the publicity
on the internet and in other sources of any testimony that you give
and point out to the reader why you were lying or being stupid or
incompetent or sloppy. You will find out that as this lawsuit drags
on that it will affect you and the other Board Members adversely in
a psychological sense. Worrying about the potential significant
liability, that is uncertain in amount, arising from long, drawn-out
litigation is very taxing for the average person.
Id. at 99 (Respondent’s Sept. 30, 2004 letter). Respondent also threatened to drag Mr. Bryan’s
14-year-old daughter into the litigation. Tr. 90-91, 95-96 (Bryan); Tr. 691-93 (Respondent); see,
e.g., BX 69 at 118-20 (Respondent states he would depose and serve document requests on Mr.
Bryan’s daughter and other Board Members’ children because he believed that Board Members
were guilty of nepotism).
102.
Respondent simply did not accept the Board’s position that the matter was closed.
Indeed, he admitted that he wrote five letters between October 30, 2004 and June 9, 2005,
“attempting, in essence, to cause [the Board] to either provide me with the requisite information
and documents and/or to settle with me.” BX 77 at 73 (¶ 14) (Respondent states he wrote a total
of 13 letters). Importantly, in 2005, Respondent continued to have full use of the Palisades
facilities, notwithstanding his threatening letters to the Board and the lawsuit that he filed against
Palisades in June 2005 (BX 69). Tr. 101 (Bryan).
48
103.
Mr. Bryan and the other Palisades Board members continued to be concerned by
Respondent’s threats to sue them.
Respondent stated his action would “break” the pool
financially and would cause the Board members considerable financial damage in defending
against his lawsuit—threats Respondent repeated at the January 2005 Palisades annual
membership meeting. The Board members, who were volunteers, were worried by Respondent’s
threats to come after them personally. Tr. 90-95, 98-100, 173-74, 177-80 (Bryan); BX 71 at 22a
(Bryan Aff. ¶ 19); see also BX 71 at 48 (Neudorfer Aff. ¶ 15).
104.
Shortly before he filed the lawsuit, Respondent sent copies of his Complaint to the
Board members. Tr. 181-82 (Bryan); Tr. 571 (Respondent). By letter dated June 28, 2005,
Palisades’ counsel advised Respondent that his claims lacked merit and that Palisades would
seek sanctions if he pursued the litigation. BX 77 at 109.
B.
Respondent’s Suit Against Palisades
105.
On June 29, 2005, Respondent filed a 240-page, 269-paragraph Complaint in the
United States District Court for the District of Maryland (Southern Division). BX 69, Fastov v.
Palisades Swimming Pool Ass’n, Civil Action No. 05-01760.
Because he alleged federal
jurisdiction based on diversity of citizenship, Respondent (a D.C. resident) sued only Palisades
and those Board members whom Respondent believed lived in Maryland. BX 69 at 2-4, ¶ 2-4;
see id. at 3, ¶ 4 (alleging that all individual named defendants reside in Montgomery County,
Maryland). Respondent admitted that he manufactured diversity by omitting the Board members
whom he knew resided in the District of Columbia. BX 77 at 14, 29; Tr. 699-703 (Respondent
argued that the omitted Board members were “permissible defendants” not “indispensible
parties”), 756-57 (Respondent admits intentionally omitting D.C. Board members as
Defendants).
49
106.
In his Complaint, Respondent included eleven causes of action:
•
Count I (Breach Of Contract And Implied Obligation To Deal In
Good Faith And Fairly With Plaintiff) (BX 69 ¶¶ 92-127);
•
Count II (Breach Of Trustee’s’ [sic] Obligation As A Fiduciary
And Of A Confidential Relationship) (BX 69 ¶¶ 128-152);
•
Count III (Negligence, Gross Negligence, Recklessness, Malicious
And/Or Willful Misconduct) (BX 69 ¶¶ 153-163);
•
Count IV (Fraud, Deceit And Intentional Stonewall, Concealment
And Cover-Up Of Material Facts) (BX 69 ¶¶ 164-181);
•
Count V (Negligent Misrepresentation And Negligent Stonewall,
Cover-Up And Concealment Of Material Facts) (BX 69 ¶¶ 182193);
•
Count VI (Violations Of The Maryland Consumer Protection Act)
(BX 69 ¶¶ 194-210);
•
Count VII (Defamation By Libel And/Or Slander By Defendants
Bryan, Neudorfer, Other Palisades Officials And The John And
Jane Doe Defendants) (BX 69 ¶¶ 211-232);
•
Count VIII (Intentional Infliction Of Emotional Distress) (BX 69
¶¶ 233-243);
•
Count IX (Civil Conspiracy (Joint Tortfeasor Liability)) (BX 69 ¶¶
244-258);
•
Count X (Disgorgement And Repayment By Palisades Officials Of
Palisades Compensation Paid The Children Of Palisades Officials)
(BX 69 ¶¶ 259-260); and,
•
Count XI (Liability For Damages Of Defendants) (BX 69 ¶¶ 261269).
See BX 69 at 4-5. In his Prayer for Relief, Respondent sought $500,000 in compensatory
damages and $1 million in punitive damages. Id. at 234. In addition to these monetary damages,
Respondent sought a declaration that Palisades
•
should not have sent the July 13, 2004 letter to Respondent;
•
should have investigated the motives of Palisades Officials and
Board Members before permitting them to communicate with
Respondent;
•
should have permitted Respondent to review all requested records;
50
•
should have permitted Respondent to review all complaints made
about him;
•
should immediately issue procedures governing investigations and
hearings regarding complaints about members;
•
should have immediately responded to Respondent’s questions;
•
should have accepted one of Respondent’s settlement proposals;
•
should not “have required or forced [Respondent] to spend
hundreds of hours in attempting to resolve this dispute with
Palisades”;
•
should not have forced Respondent to sue Palisades;
•
should have settled this matter in 2005, when Respondent sent
Board Members a draft of his Complaint; and,
•
should not have engaged in nepotism.
Id. at 235-37.
Finally, claiming that “monetary damages cannot adequately compensate
[Respondent] for the harm he has suffered and may continue to suffer,” Respondent demanded
that the Court order, inter alia, that Palisades
•
immediately rescind the July 13, 2004 letter, and destroy any
copies thereof;
•
“sign an apology to [Respondent], in a manner satisfactory to
[Respondent]”;
•
refrain from enforcing any order that carries a potential penalty of
suspending or terminating Respondent’s membership; and,
•
permit Respondent and five people of his choosing to use the
Palisades facilities free of charge for the remainder of
Respondent’s life.
BX 69 at 238-39.
107.
At the hearing, when questioned about the factual and/or legal basis for a number
of his claims, Respondent explained that they were additional “pressure points” or “levers” to
force Palisades to settle. Tr. 580-82, 651-52, 678-80, 687-90, 693, 753. He described his claims
as “very flexible”; he just put a different label on claims to find “a button.” Id.
51
108.
On September 22, 2005, Palisades and the Board members filed an Answer in
which they requested that the Court sanction Respondent. BX 70 at 7, ¶ 5. In response,
Respondent filed a 48-page opposition with an attachment. RX 35.
109.
On November 17, 2005, Defendants filed a Motion to Dismiss or for Summary
Judgment, arguing that the case should be dismissed for lack of subject matter jurisdiction and/or
for failure to state a claim upon which relief could be granted. BX 71. Defendants noted that
Respondent had intentionally not named certain Board members as defendants in an effort to
“artificially create diversity jurisdiction,” but had inadvertently sued one who lived in D.C. Id.
at 1-2. Defendants also explained why each of Respondent’s claims had no merit, and renewed
their request for sanctions because Respondent had filed the action in bad faith, and “as an act of
retaliation and vindictiveness against the Board and certain of its officers.” BX 70 at 119.
110.
In response to Defendants’ motion to dismiss or for summary judgment,
Respondent filed a 50-page opposition memorandum, which attached a 58-page statement of
material facts in dispute as well as Respondent’s 57-page declaration that incorporated by
reference his 240-page Complaint, and contained additional factual and legal argument. BX 72.
One of Respondent’s principal contentions was that he should not have to respond to
Defendants’ summary judgment motion until after he had conducted discovery. See, e.g., id.
at 7.
111.
Defendants filed a 17-page reply, reiterating that Respondent’s claims were
frivolous and the Court should sanction Respondent. BX 73. Respondent then sought leave of
the Court to file a 27-page surreply, in which he repeated his claim that he was entitled to
discovery. BX 74. The Court denied this motion as moot. BX 75 at 5.
52
112.
On January 31, 2006, the Court entered judgment in favor of Defendants. The
Court found that it lacked subject matter jurisdiction because there was no diversity of
citizenship when the action commenced and, even if Respondent dismissed the D.C. Defendant,
the Court still would lack jurisdiction because D.C. residents were indispensible parties. Id. at 4.
The Court found that Respondent’s claim that it had subject matter jurisdiction “defies credulity”
and that Respondent’s choice to name certain directors as defendants and not others “represents a
transparent effort to fabricate subject matter jurisdiction over this dispute.” Id. at 7. The Court
cited Respondent’s knowledge that he had no legal basis for filing the action in the federal court
in Maryland as further evidence that Respondent “filed this frivolous Complaint for the purpose
of harassing Defendants.” Id.
113.
In granting the Defendants’ motion for sanctions, the Court found that
Respondent’s “conduct in this suit and his actions leading to this litigation violate the very text of
Rule 11.” BX 75 at 6. The Court found that Respondent, while accurately stating most of the
facts that served as a basis for his Complaint, filed it with an improper motive. Id. Respondent’s
“various missives to Defendants,” which Respondent quoted in his Complaint, “evince[d] an
intent to harass Defendants.” Id. The Court found that on multiple occasions, Respondent
threatened to bankrupt the Defendants if they did not acquiesce to his demands, and quoted some
of those threats. Id. at 6-7. The Court found that “[t]aken as a whole, [Respondent’s] Complaint
and subsequent pleadings contain ample evidence that [Respondent] did not file this suit [to]
vindicate his rights, but to harass and retaliate against Defendants.” Id. at 7. After hearing all of
the evidence, including Respondent’s testimony, we concur with the Court’s findings.
114.
The Court directed the Defendants to submit evidence of their reasonable legal
fees and costs associated with Respondent’s lawsuit. BX 75 at 8. On February 13, 2006,
53
Defendants sought a total of $24,543.30 for the fees and costs incurred in defending against
Respondent’s action. BX 76. On February 27, 2006, Respondent filed a 50-page opposition,
supported by his 45-page affidavit, most of which simply reiterated his arguments on the
purported merits of his claims and argued that the Court erred in dismissing his action. BX 77.
Only a small fraction of Respondent’s opposition and his affidavit responded to Defendants’ fee
request. BX 77 at 50-60, 104-07.
115.
Respondent’s pleadings, like his letters, were replete with insulting and
demeaning comments about not only Palisades and its Board members, but also defense counsel
and the trial judge. See, e.g., BX 77 at 2, 54-55 (Respondent stated opposing counsel was
“slimy,” had “ethical shortcomings,” had a “blatant conflict of interest” because he represented
the Palisades Board and the individual Board members, and his arguments were “hyperbolic,
inflated, disingenuous and inflammatory rhetorical conclusions”); BX 77 at 55, 58, 61
(Respondent contended that Court was “biased,” and its order was a “diatribe, impugning
[Respondent’s] integrity and judgment” and “riddled with abuses of discretion”).
116.
On March 2, 2006, Respondent appealed the order dismissing his case. BX 80
at 1. On June 26, 2006, the District Court denied Defendants’ request for legal fees, but did so
“without prejudice, to Defendants’ right to reassert the motion at a later time.” BX 79 (emphasis
in original).
117.
On January 9, 2007, the United States Court of Appeals for the Fourth Circuit
affirmed the District Court’s order granting the motion to dismiss and request for sanctions, for
the reasons stated by the District Court. BX 81 at 4. Respondent then petitioned for rehearing
and rehearing en banc, which the Fourth Circuit denied by order dated March 12, 2007. BX 82.
54
118.
On April 27, 2007, following the issuance of the mandate by the Fourth Circuit
(BX 81 at 1), Defendants renewed their request for attorneys’ fees and costs in a seven-page
motion that attached their counsel’s time records. BX 83. In response, Respondent filed a 50page opposition, together with a 79-page declaration (which contained additional argument).
BX 84. Respondent also attached a 56-page supplement, most of which was single-spaced, and
is comprised entirely of legal argument and extended discussion of the cases cited in his
memorandum. RX 38c (Respondent’s 56-page Attachment 1, as well as Attachments 2-3).
119.
When the District Court granted Defendants’ motion for sanctions and requested
that they submit a memorandum with supporting information, the District Court advised
Respondent that he could file a reply within the normal time period and that he “must comply
with the page limit set forth [in Maryland Local Rule 105].” BX 75 at 8.
120.
The Palisades Board eventually agreed to withdraw the request for attorney’s fees
in order to completely sever its relationship with Respondent. Tr. 117-18. As the District Court
found (and Fourth Circuit affirmed), Palisades and the Board members were entitled to recover
their attorney’s fees because Respondent’s claims were frivolous and brought in bad faith.
BX 75 at 6. Yet, Palisades and the Board members were willing to forego reimbursement
because, as Mr. Bryan explained, they wanted to get away from the “constant barrage of
bullying” and Respondent’s vindictiveness. Tr. 112, 116-18. Mr. Bryan testified that a key
provision in the settlement agreement was Respondent’s agreement that, in return for
reimbursement of his membership bond of $500, Respondent would never apply for membership
or enter the Palisades premises, on pain of sanctions for trespass. BX 88 at 4 (Section 6); Tr.
118-19.
55
121.
Palisades and the Board members acknowledged in the settlement agreement that
the July 2004 letter to Respondent was never intended to and did not accuse him, explicitly or
impliedly, of child molestation, pederasty, pedophilia, or any other inappropriate sexual conduct,
or of battery and assault. BX 88 at 2 (Section 3). This was hardly a concession because no one
on the Board ever made such accusations against Respondent. See Tr. 103-04, 114-15, 184-85
(Palisades Board never accused or called Respondent any of the terms used by Respondent; the
behavior defined as “inappropriate,” from which the Board expected Respondent to refrain, was
that set forth in the July 2004 letter); Tr. 686, 689, 740 (Respondent; same).
122.
Respondent attempts to claim that Section 3 of the Settlement Agreement
vindicates his conduct because it gave him the “heart” of the relief he sought. Tr. 564-65, 577,
619, 676-77. Respondent is wrong. Section 3 simply acknowledged what had been the Board’s
position all along, that no one on the Board accused him of child molestation, pederasty,
pedophilia, or any other inappropriate sexual conduct, or of battery and assault. Respondent
made far greater settlement demands than the simple clarification he received. See BX 69 (10
letters quoted therein); Tr. 742-43 (Respondent). We reject the argument that the Settlement
Agreement shows that Respondent actually “won” his dispute with Palisades. Simply put, we
find that the Palisades Board dropped its demand for $40,000 so that it could put an end to its
dealings with Respondent, not because any one ever thought that any of his claims had any merit.
See Tr. 104-05, 117-18, 192 (Bryan).
56
III.
Facts Relating to Respondent’s Fitness to Practice Law
123.
Respondent has repeatedly stated that he is unable to practice law. In a December
2000 letter to Judge Friedman, Respondent complained about the amount of the sanction being
considered, and represented that he had no ability “to supplement [his] income by the private
practice of law for a fee, which [he had] never done, and which [he was] physically and mentally
incapable of doing effectively.” BX 42 at 8; see also id. (“I have never earned a fee from a
private client in the private practice of law; and I have no intention or capacity of doing so in the
future or bringing any other lawsuits on my own behalf.”).
124.
Respondent made this point again, in objecting to Magistrate Judge Kay’s
recommendation that Respondent should pay Christie’s $110,000:
I have no intent of ever filing any other lawsuit on my own behalf
in the future, and I have not ever engaged in the private practice of
law for a fee-paying private client and could not physically [sic]
and was otherwise unable to practice law at nearly age 65, because
of my significant health problems, my total lack of experience in
private litigation on behalf of fee-paying private parties, my
ceasing the active practice of law as a government attorney in
December 1985, and my unemployability as an attorney in private
practice, given the foregoing considerations.
BX 45 at 8-9.
125.
Respondent reiterated this position in his Answer to the Specification of Charges,
•
“Because of my age, I am almost 67, and my impaired health and
other physical and mental limitations and incapacities and my
dislike of litigation and other practice of law [sic] and attorneys, I
have absolutely no intention, inclination, desire or physical or
mental capacity to engage in litigation of any kind or practice of
law in the future.” Respondent’s Answer at 302;
•
“The thought has occurred to me that my [health-related problems]
could cause me to make a legal errors [sic], which could hurt a
client and subject me to malpractice claims, that could have the
potential to bankrupt me.” Id. at 303;
•
“I have no intent or capacity to use in the future my D.C. Bar
57
license to earn income from litigation or other practice of law.” Id.
at 300; and,
•
126.
Respondent told Bar Counsel that he “hated the practice of law and
had absolutely no capacity or intention to practice law to generate
any income for the rest of his life.” Id. at 297.
During the hearing, it became clear that Respondent is unable to practice law. For
example, when told at the beginning of the hearing that he was expected to be respectful and
professional when cross-examining witnesses, he replied:
I will do it as professionally as I am capable of after having
not practiced law for 25 years. Do you understand? I mean, there
are things that I can’t—you know, I don’t remember a lot of this
stuff about the practice of law. Do you understand? I will do the
best I can.
Tr. 53.
127.
In his post-hearing Surreply arguing against Bar Counsel’s proposed fitness
requirement, Respondent shows that such a fitness requirement is necessary when he argues that
“it is difficult to see how Fastov could meet such fitness requirement with regard to future
litigation tactics, strategies and filings, assuming he would want to practice law, which he clearly
does not want to do and cannot do.” Surreply at 33 (emphasis added).
128.
Even without Respondent’s admissions, we would find that he is unfit to practice
law. As Judge Friedman observed in striking Respondent’s first summary judgment opposition,
“[a] first year law student is taught that a filing in support of or in opposition to any motion
should be tailored to achieve the paramount goal of assisting the Court in rendering its decision.
[Respondent’s] filing does the opposite.” BX 15 at 1. Based on our review of the record
evidence and our review of Respondent’s filings in this proceeding, we conclude that
Respondent’s arguments consistently were not tailored to assist the fact-finder in reaching a
decision.
This is not a matter of style.
Respondent’s written arguments are so long and
58
disorganized, and contain so much extraneous information, that it is nearly impossible to locate
within them any factual or legal support for Respondent’s arguments.
129.
In this disciplinary proceeding, Respondent filed a 279-page Answer in response
to Bar Counsel’s 123-paragraph, 30-page specification of charges. The vast majority of this
Answer contained Respondent’s substantive and procedural legal and factual arguments as to
why the Hearing Committee should not find the charged violations. Although the Answer
contained many lengthy arguments, it failed to unambiguously admit or deny many of the
allegations. As such, it did not fulfill the Answer’s primary function: to help determine the
areas of factual dispute between the parties. To remedy this problem, although we accepted the
original Answer, we ordered that Respondent file a Supplemental Answer that “clearly and
succinctly responds to each of the allegations” by admitting or denying each of allegations, or
parts of each allegation, as the case may be. Order, In re Fastov, Bar Docket No. 105-07 at 3
(H.C. Dec. 1, 2010). The Order also directed that Respondent’s Supplemental Answer could not
“contain objections, factual or legal argument, or any other discussion that is not limited to a
direct and concise response to the allegations in the Specification of Charges.” Id.
130.
Respondent filed his 187-page Supplemental Answer on December 17, 2010. The
Supplemental Answer was stricken because it was “replete with argument and extraneous
discussions that, like the original Answer, make it difficult for the Hearing Committee to
determine the facts in dispute between Respondent and Bar Counsel.” Order, In re Fastov, Bar
Docket No. 105-07 at 2, 4 (H.C. Dec. 21, 2010). Respondent was ordered to file a Second
Supplemental Answer using a prescribed format. Id. Rather than file a Second Supplemental
Answer, Respondent sought reconsideration of the December 21 Order. Attached to the motion
for reconsideration was a 35-page document that served as the functional equivalent of a proper
59
Answer. As a result, the Hearing Committee denied the motion for reconsideration as moot, and
accepted the attachment in lieu of the requested Supplemental Answer.
131.
Respondent’s difficulties were not limited to his written submissions. During the
Hearing, Respondent failed to cogently and coherently explain his theory of defense, choosing
instead to rail against Christie’s, Mr. Bryan, and the courts (primarily Judge Stafford).
132.
Moreover, he was not adequately prepared to defend himself at the hearing. For
instance, Respondent said that, until the second night of the three-day hearing, he had not read
the Palisades Complaint in six years. Tr. 618. Bar Counsel charged that Respondent violated
Rule 3.1 by filing that Complaint. His failure to review the Complaint until after the second day
of the hearing is simply incomprehensible. Indeed, we cannot fathom how a reasonable attorney
would prepare to defend a case without reading the very document that served as a basis for one
of Bar Counsel’s charges.
133.
It is also clear that Respondent still refuses to abide by the rules of a tribunal. For
instance, in his post-hearing brief, Respondent represented in his Certificate of Compliance that
his brief contained 20,998 words, just under the 21,000 word limit ordered by the Hearing
Committee. However, Respondent came under the word limit by using an improper citation
format, one that omitted spaces between exhibit references. For instance, on page 2 of his brief,
Respondent used the following cite, which counts as only three words:
“See BX41,pp.8-
22;FX40,pp.89-179;FX41c,FX41d,pp.18-49,101-128; FX65.” Had Respondent used appropriate
citation form “See BX41, pp.8-22; FX40, pp.89-179; FX41c, FX41d, pp.18-49, 101-128; FX65,”
it would have counted as ten words. Respondent used this tactic throughout the brief, and as a
result, filed a longer brief than was permitted. As Respondent did not use such a compressed
citation form in his Pre-Hearing Brief, we can only conclude that he used this citation form so
60
that he would appear to have complied with the word count. While this may seem like an
insignificant example, we believe that it reflects that Respondent’s inability or refusal to comply
with even the most basic filing requirements.
CONCLUSIONS OF LAW
Bar Counsel has charged that Respondent’s conduct violated five provisions of the D.C.
Rules of Professional Conduct
a.
Rule 3.1, in that Respondent brought and then pursued claims and
asserted issues when there was no basis for doing so that was not
frivolous (Christie’s and Palisades);
b.
Rule 3.2, in that Respondent, representing himself, sought to
delay proceedings when he knew or when it was obvious that
such action would serve solely to harass or maliciously injure
another (Christie’s only);
c.
Rule 3.4(c), in that Respondent knowingly disobeyed an
obligation under the rules of a tribunal (Christie’s only);
d.
Rule 4.4, in that Respondent, in representing himself, used means
that had no substantial purpose other than to embarrass, delay or
burden a third person (Christie’s and Palisades); and,
e.
Rule 8.4(d), in that Respondent engaged in conduct that seriously
interfered with the administration of justice. (Christie’s and
Palisades).
BX 2 at 21-22 (¶ 94), 30 (¶ 123) (Specification of Charges). As is fully discussed below, we find
that Bar Counsel proved all charged violations by clear and convincing evidence. See Board
Rule 11.5 (“Bar Counsel shall have the burden of proving violations of disciplinary rules by clear
and convincing evidence”). Clear and convincing evidence means “more than a preponderance
of the evidence; [it] means evidence that will produce in the mind of the trier of fact a firm belief
or conviction as to the facts sought to be established.” In re Cater, 887 A.2d 1, 24 (D.C. 2005)
(quotations, citations omitted).
61
A.
Respondent Violated Rule 3.1 By Bringing Frivolous Claims Against
Christie’s and By Bringing Any Claims Against Palisades
D.C. Rule of Professional Conduct 3.1 provides, in relevant part, that
A lawyer shall not bring or defend a proceeding, or assert
or controvert an issue therein, unless there is a basis in law and fact
for doing so that is not frivolous, which includes a good-faith
argument for an extension, modification, or reversal of existing
law.
In order to prove that Respondent’s conduct violated Rule 3.1, Bar Counsel must prove that “a
reasonable attorney would have concluded that there was not even a faint hope of success on the
legal merits of the action.” In re Spikes, 881 A.2d 1118, 1125 (D.C. 2005).
1.
Fastov v. Christie’s
As discussed above, from our review of the record, it appears that Respondent had claims
arising out of two separate occurrences: 1) the breach by Christie’s of Ms. Goldsmith’s alleged
promise to auction the painting as an authentic Schindler; and, 2) Christie’s alleged
misrepresentation as to Dr. Frödl’s reasons for declining to provide a positive authenticity
opinion. We treat claims arising out of each occurrence separately below.
(a)
Claims Relating to Ms. Goldsmith’s Alleged Promise to
Auction the Painting as an Authentic Schindler
We find that a reasonable attorney would have concluded that there “was not even a faint
hope of success” that Respondent would prevail on any claim against Christie’s predicated on the
allegation that Ms. Goldsmith had promised that Christie’s would auction the painting as an
authentic Schindler without seeking an expert authenticity opinion. As discussed above, we do
not believe that Ms. Goldsmith made such a promise; however, even assuming for the sake of
argument that she had, the Statute of Limitations had expired on any claims based on Christie’s
alleged breach of that promise.
62
In the District of Columbia, a three-year Statute of Limitations applies to both contract
and tort claims. D.C. Code § 12-301. Contract claims must be brought within three years of the
alleged breach, and tort claims must be brought within three years of the alleged injury. See
Bernberry v. District of Columbia, 758 A.2d 518, 519 (D.C. 2000) (contract); Colbert v.
Georgetown Univ., 641 A.2d 469, 472 (D.C. 1994) (tort). As is discussed below, we find that
Respondent’s claims based on the alleged agreement not to seek an expert opinion accrued no
later than May 20, 1993, the date that Respondent’s painting was to be auctioned. 18
Respondent knew on March 19, 1993, that Christie’s had approached Dr. Frödl, and had
requested an authenticity opinion. See BX 14 at 377-78 (Letter to Poltimore at 16-17). Indeed,
in his letter to Lord Poltimore, Respondent recounted that he had asked Ms. Goldsmith whether
Christie’s would “consider withdrawing [its] request for a formal written opinion,” under certain
circumstances. Id. at 378 (emphasis added). Thus, on March 19, 1993, Respondent knew that
Christie’s was actively pursuing an authenticity opinion from Dr. Frödl. This would have been a
breach of Respondent’s alleged oral agreement. Under Respondent’s theory of liability, when
Christie’s did not include his painting in the May 20, 1993 auction because Dr. Frödl could not
give an unqualified opinion, Christie’s had breached its alleged promise to offer the painting as
an authentic Schindler. Thus, at that time, under Respondent’s theory, he had claims against
Christie’s for breach of contract and for fraudulently inducing him to consign the painting to
Christie’s. Respondent did not file suit until March 21, 1997, more than three years later.
This is not to say that discipline should result whenever a lawyer files a case that is later
determined to be time-barred. However, discipline is appropriate here because Respondent has
18
In reaching this conclusion, we agree with Judge Stafford’s summary judgment ruling.
Because we previously declined to give Judge Stafford’s ruling preclusive effect, we believe that
it is important to note that while we agree with Judge Stafford, we have come to our own
conclusion on this issue, and not simply relied on Judge Stafford’s conclusion.
63
acknowledged that he knew of the allegedly actionable conduct in April 1993, and knew of the
three-year Statute of Limitations when he filed suit on March 21, 1997. See RX 15 at 27, n.56
(Respondent’s Memorandum in Support of his Motion to file a Surreply in Opposition to
Christie’s Motion for Summary Judgment) (arguing that the suit was filed “within the applicable
three year statute of limitations”).
Respondent has argued that his claim for breach of contract did not accrue in April 1993
when he learned of the breach, because “he also knew that his claim for damages for breach of
contract was virtually worthless, because Christie’s had advised him that Christie’s and [Dr.]
Frödl believed that his painting was not authentic” and thus Christie’s would argue that he had
not been damaged by Christie’s decision not to auction a fake painting. RX 15 at 27, n.56. This
argument ignores allegations he made in his Amended Complaint, specifically, that he was
induced to enter into an oral consignment agreement by Ms. Goldsmith’s fraudulent statements
that Christie’s had decided that the painting was authentic, and would not consult with outside
experts. See BX 14 (Amended Complaint) at 280, ¶¶ 64-65(a & b) (Fraud in the Inducement);
282, ¶ 71(a) (Negligent Misrepresentation); 283, ¶ 76(a) (Violation of D.C. Consumer Protection
Statute); 285, ¶ 80(a) (Breach of Fiduciary Duty); and, 287, ¶84 (Breach of the Oral
Consignment Agreement and Implied Duty of Good Faith and Fair Dealing). Thus, under
Respondent’s theory, as a result of Ms. Goldsmith’s allegedly false promise that Christie’s would
not seek an expert opinion on authenticity, he had been induced to consign the painting to
Christie’s and bear the expense of shipping it to London for auction. His cause of action accrued
no later than May 20, 1993, when Christie’s did not auction the painting as a result of Dr. Frödl’s
inability to render an opinion. See Bernberry, 758 A.2d at 519; Colbert, 641 A.2d at 472 (tort).
64
(b)
Claims Relating to Christie’s Alleged Misrepresentation
Regarding Dr. Frödl’s Reason For Not Offering An Opinion
(i)
No Rule 3.1 Violations For Claims Other Than The
Intentional Infliction Of Emotional Distress Claim
Other than his Intentional Infliction of Emotional Distress claim, we believe that
Respondent had more than a faint hope of success in bringing claims based on his allegation that
Christie’s employees had informed him that Dr. Frödl thought his painting was a fake. Although
Judge Stafford held that all of Respondent’s claims were time-barred because Respondent knew
or should have known more than three years before suit was filed that Dr. Frödl did not call the
painting a fake, we respectfully disagree. See supra, ¶ 57. We find instead that Respondent did
not learn that Dr. Frödl had not called the painting a fake until March 21, 1994, when he read a
translation of Dr. Frödl’s March 11, 1994 letter. We see no evidence in the record that would
cause Respondent to even question his understanding of Dr. Frödl’s position (that the painting
was a fake), until he read Dr. Frödl’s March 11, 1994 letter. Thus, we do not find that Bar
Counsel has proven by clear and convincing evidence that Respondent violated Rule 3.1 when he
filed the following claims based on his mistaken, but good faith belief, that Christie’s
intentionally or negligently misrepresented Dr. Frödl’s position on Respondent’s painting:
Fraudulent Misrepresentation and Concealment of Material Facts (Count 1), Negligent
Misrepresentation (Count 2), Violation of D.C. Code § 28-3904 (Count 3), Breach of the Oral
Consignment Agreement/Breach of the Implied Duty of Good Faith and Fair Dealing/Breach of
Fiduciary Duty (Count 4), and Negligence (Count 4 [sic]).
Bar Counsel has argued that Respondent violated Rule 3.1 by bringing a claim under the
D.C. Consumer Protection Procedures Act (“CPPA”) (D.C. Code § 28-3904). We do not believe
that there is clear and convincing evidence to support this charge. Bar Counsel argues that the
65
CPPA claim was meritless because Respondent was a professional art dealer, not a consumer,
and the alleged false statements took place in England, not the District of Columbia. Although
Judge Stafford granted summary judgment against Respondent, we are not convinced that the
claim had “not even a faint hope of success.”
First, Bar Counsel is incorrect in asserting that, vis-à-vis Christie’s, Respondent was a
“would-be seller.” Bar Counsel’s Post-Hearing Brief at 20; see also Bar Counsel’s Post-Hearing
Reply at 10 (arguing that Respondent was “an art dealer engaged in his regular business of
selling art when he consigned to Christie’s the painting….”) (emphasis in original). Instead,
Respondent consigned the painting to Christie’s for Christie’s to auction, for which it would
receive a commission. We are not persuaded by Bar Counsel’s argument that this could not be
considered a consumer transaction. D.C. Code § 28-3901(a)(1) defines “consumer” as “a person
who does or would purchase, lease (from), or receive consumer goods or services. . . .; as an
adjective, ‘consumer’ describes anything, without exception, which is primarily for personal,
household, or family use.” Section 28-3901(a)(7) defines “goods and services” as “any and all
parts of the economic output of society, at any stage or related or necessary point in the
economic process and includes consumer credit, franchises, business opportunities, real estate
transactions, and consumer services of all types.” Under these broad definitions, courts have
held that the statute applies to a defendant who offered assistance in obtaining a green card (Jia
Di Feng v. Lim, 786 F. Supp. 2d 96, 109 (D.D.C. 2011)), and a defendant who held himself out
as a “foreclosure-avoidance specialist” (Byrd v. Jackson, 902 A.2d 778, 781 (D.C. 2006)). In
light of this authority, we cannot conclude that it is obvious that a court would reject
Respondent’s argument that he was a consumer of auction services, such that that argument
would have no chance of success. See Respondent’s Post-Hearing Brief at 41.
66
In addition, although Judge Stafford ruled that the CPPA did not apply because it was not
intended to apply extraterritorially, we find that it was not unreasonable for Respondent to
believe that the CPPA could apply to the conduct at issue here. Respondent had responded to an
advertisement in D.C. regarding the upcoming auction, and shipped his painting from D.C. to
London for auction. In Williams v. First Gov’t Mortg. & Investors Corp., the defendant, an
alleged predatory lender, was not a D.C. corporation, had offices in Maryland, met with the
plaintiff in Maryland, and accepted the loan payments in Maryland. 176 F.3d 497, 499 (D.C.
Cir. 1999). The D.C. Circuit found that the CPPA applied because the District of Columbia “has
an interest in protecting its citizens from predatory loan practices” and that the transaction had
significant contacts with D.C., including that the defendant took plaintiff’s house as collateral.
Id. While we acknowledge that there is a difference between taking a D.C. resident’s house as
collateral, and inducing a D.C. resident to send a painting for auction, we cannot find by clear
and convincing evidence that a reasonable lawyer would conclude that Respondent’s CPPA
claim had no chance of success. 19
(ii)
Respondent’s Intentional Infliction Of Emotional
Distress Claim Violated Rule 3.1 Because It Did Not
Have Even a Faint Chance of Success
Although the Intentional Infliction of Emotional Distress claim may have been timely, we
see “not even a faint hope of success.” In order to prevail on such a claim, “a plaintiff must
prove that the defendant engaged in: (1) extreme and outrageous conduct that (2) intentionally
or recklessly caused (3) severe emotional distress to another.”
Jonathan Woodner Co. v.
Breeden, 665 A.2d 929, 934-35 (D.C. 1995). “The conduct must be so outrageous in character,
19
We are not persuaded by Bar Counsel’s suggestion that we should find some improper
purpose in Respondent’s admission that he included the CPPA claim because it allowed recovery
of attorneys’ fees, treble damages, and punitive damages. Bar Counsel’s Post-Hearing Reply at
8-9. We find nothing improper in this attempt to take advantage of that which the law allows.
67
and so extreme in degree, as to go beyond all possible bounds of decency, and to be regarded as
atrocious, and utterly intolerable in a civilized community.” Drejza v. Vaccaro, 650 A.2d 1308,
1312 n.10 (D.C. 1994). Taking Respondent’s allegations as true, Christie’s conduct comes
nowhere near this standard. At worst, Christie’s lied to Respondent about Dr. Frödl’s opinion on
his painting and used this lie as its justification for declining to auction his painting. While this
is not commendable behavior, it is it not “utterly intolerable in a civilized society.” Id. Thus, we
find that Respondent had not even a faint hope of success on his intentional infliction of
emotional distress claim, and that he violated Rule 3.1 when he brought that claim against
Christie’s.
(c)
Summary
Accordingly, we conclude that Bar Counsel has proved by clear and convincing evidence
that Respondent violated Rule 3.1 in bringing time-barred claims against Christie’s regarding the
alleged oral consignment agreement, and in bringing the claim for intentional infliction of
emotional distress. We find that Bar Counsel has not proven by clear and convincing evidence
that Respondent violated Rule 3.1 when he brought claims (other than the claim for intentional
infliction of emotional distress) relating to the alleged misrepresentation regarding what Dr.
Frödl told Dr. Schönburg-Hartenstein.
2.
Fastov v. Palisades
On the evidence presented, no reasonable attorney could conclude that any of
Respondent’s claims against Palisades had any chance of success because no one from Palisades
did anything even remotely actionable.
As discussed above, the Palisades Board sent
Respondent a letter instructing him to stop behavior that other pool members found to be
objectionable. See ¶ 92. We agree with Mr. Bryan that the Board acted responsibly and in the
68
legitimate exercise of its duties and obligations to ensure the safety and well being of its
members. BX 71 at 18-20 (Bryan Aff. ¶¶ 8-12). Quite simply, the letter—which directed
Respondent to “cease and desist in any behavior that is perceived to be leering, sexually
intimidating, or creating a sexually hostile environment which serves to intimidate and frighten
our female members and staff”—caused him no compensable harm, nor did the Board’s
subsequent actions and communications in which they repeatedly advised Respondent that
Palisades considered the matter closed. BX 71 at 39-41; Tr. 747-48 (Respondent admits Mr.
Bryan responded to his initial letters by stating that the matter was closed, but contends Mr.
Bryan’s letters were not responsive). We discuss each of the claims in detail below, and
conclude that Respondent violated Rule 3.1 in bringing these claims against Palisades.
(a)
Breach of Contract
Palisades did not breach any contractual duty to Respondent. The purported “contract”
that Respondent alleged supported his claim was Palisades’ Articles of Incorporation, which
provide that one of the purposes of Palisades is “[t]o promote the health and general welfare” of
residents in and around Glen Echo “by constructing, owning and operating on a non-profit basis
a swimming pool and other recreational facilities.” BX 69 at 138. Respondent contended that
this provision required Palisades to promote Respondent’s health and general welfare
(Tr. 654-55), and to do so apparently in derogation of the rights and welfare of the other pool
members and staff. This position is untenable. Palisades was not required to disregard the
health, safety, and welfare of its other members and their rights to use and enjoy the facilities by
permitting Respondent to engage in abusive, bullying, or inappropriate conduct.
69
Finally, Respondent offered no evidence that Palisades had a contractual or other legal
obligation to respond to Respondent’s myriad and ever-escalating demands for information,
documentation, and compensation, nor could we find any in the record.
(b)
Breach of Fiduciary Duties
We saw no evidence supporting Respondent’s contention that he had a “confidential
relationship” with Palisades, which required that he “reposed confidence in Members of the
Palisades Board of Directors.” BX 69 at 168; Latty v. St. Joseph’s Soc’y of the Sacred Heart, 17
A.3d 155, 162 (Md. Ct. Spec. App. 2011) (there must be actual trust and confidence between the
parties to a fiduciary relationship). Indeed, the facts are to the contrary. There was no evidence
that Respondent relied or depended on the Palisades Board for anything at all, other than,
presumably, the continued operation of Palisades itself.
See Latty, 17 A.3d at 161-62
(dependence is essential to a fiduciary relationship). Respondent offered no evidence to suggest
that the Palisades Board had a fiduciary duty to him to not investigate the allegations against
him, or not to issue the warning letter. Respondent’s complaint that the Board acted in an
arbitrary, capricious, abusive, and incompetent fashion and conducted a “Gestapo like probe” of
his actions, even if taken as true, does not allege a breach of fiduciary duty. BX 69 at 23-24, 26.
(c)
Negligence
It is difficult to discern the basis for Respondent’s negligence claim, but it appears to
have been based on some purported denial of “due process” because Respondent was not
permitted to conduct discovery, cross-examine witnesses under oath, etc. BX 69 at 173-83.
Respondent does not explain how this supports a negligence claim, how this constituted a breach
of the Board’s duty to him, or how he was damaged. See Consol. Waste Indus. v. Std. Equip.
70
Co., 26 A.3d 210, 360 (Md. 2011) (a plaintiff alleging negligence must prove that he was
damaged by the defendant’s breach of duty).
(d)
Fraud
There was nothing fraudulent or dishonest about the Board’s July 2004 letter to
Respondent. B.N. v. K.K., 538 A.2d 1175, 1182 (Md. 1988) (tort requires a knowing false
statement). Similarly, the Board’s decision not to respond to Respondent’s derogatory and
threatening letters demanding detailed information, documentation, and compensation was not
fraudulent, dishonest, or actionable.
Respondent alleged that Mr. Bryan and the Board lied when it told Respondent in the
July 13 letter that “[i]f you have a question or need clarification of the above noted conditions
. . . or the situations giving rise to these conditions, direct them to [Mr. Bryan].” BX 69 at 18485. Respondent claims that this was a lie because the Board never responded to Respondent’s
detailed requests for information. See id. at 185-93. We reject this argument because we see
nothing in Mr. Bryan’s offer to provide more information that would require him or the Board to
comply with Respondent’s “discovery-style” requests for information. Simply put, we do not
believe that Mr. Bryan was offering to provide the identities of every person who had made a
complaint about Respondent, or any of the other particulars that Respondent had demanded.
Moreover, we do not see how Respondent was damaged by not gaining access to the information
he demanded.
(e)
Misrepresentation
There is no evidence that anyone from the Palisades Board made any misrepresentations
to Respondent, much less a misrepresentation that caused some damage. Lloyd v. GMC, 916
A.2d 257, 273 (Md. 2007). Indeed, the only material factual representations in the July 2004
71
letter were the representations that the Board had received complaints about Respondent. Bar
Counsel presented evidence, affidavits from the complainants themselves, proving that the
complaints had been made. See BX 71 at 43, 45, 49, 52, 56, 59, 65. Respondent offered no
evidence to suggest that the complaints had not been made or that the complaints in the July
letter were fabricated.
As discussed above, we do not believe that the Board’s decision not to provide
Respondent with all of the information he requested means that the offer to provide clarifying
information was a lie.
(f)
Violations of Maryland Consumer Protection Act
Respondent’s claim under the Maryland Consumer Protection Act likewise had no basis.
Respondent had no standing under the Act because he was not a consumer of services from a
merchant, but a member of a voluntary, non-profit, member-only, civic organization. Md. Code
Ann. § 13-303 (prohibiting unfair or deceptive trade practices in consumer transactions); see also
Tr. 654, 680 (Respondent: “I was a bondholder”). In any event, Palisades had not engaged in
any conduct that violated the Act, and Respondent had not suffered any loss or injury from the
confidential warning letter he received in July 2004 that would provide a basis for a claim for
damages, much less legal fees (which he had not incurred).
(g)
Defamation by Libel or Slander
Respondent claimed that the Palisades Board accused him of being a “sexual pervert,
pederast, pedophile, assaulter and batterer,” and that this accusation was the basis for his lawsuit.
BX 69 at 5. Importantly, we see no evidence that anyone from Palisades ever used these terms to
describe Respondent, either expressly or impliedly. Tr. 103-04, 114-15, 184-85 (Palisades Board
never accused or called Respondent any of the terms used by Respondent; the behavior defined
72
as “inappropriate,” from which the Board expected Respondent to refrain, was that set forth in
the July 2004 letter); Tr. 686, 689, 740 (Respondent; same). Not only was the July 2004 letter
not defamatory, but no one from Palisades published it to anyone other than Respondent, as
Respondent admits. Tr. 568, 687-88, 736-37 (Respondent admitted he had no knowledge that
the letter was disseminated to others); see Norman v. Borison, 17 A.3d 697, 706 (Md. 2011) (a
plaintiff alleging defamation must plead and prove that a defamatory statement was
communicated to a third party, among other things).
Rather, Respondent himself publicized the July 2004 letter, by quoting it in his
Complaint and other pleadings. BX 69 at 53-54; Tr. 736 (Respondent). It was also Respondent,
and only Respondent, who claimed he had been accused of being a “sexual pervert, pederast,
pedophile, assaulter and batterer,” and who published these statements repeatedly in his publiclyfiled documents. Tr. 738-40 (Respondent); see, e.g., BX 69 at 7, 44, 51; BX 72 at 112; BX 74
at 8; BX 77 at 22, 64, 66.
(h)
Intentional Infliction of Emotional Distress
Contrary to Respondent’s claim, repeated at the hearing (Tr. 689-90), there was nothing
“extreme” or “outrageous” about the Board’s confidential warning letter of July 13, 2004, or its
decision not to divulge the names and other detailed information about the complainants,
particularly after Respondent had confronted one of the teenagers who had complained about
him. Absent evidence of some “extreme” or “outrageous” conduct by the Board, of which there
was none, there was no factual or legal basis for Respondent’s claim of intentional infliction of
emotional distress. See Harris v. Jones, 380 A.2d 611, 614 (Md. 1977)
73
(i)
Civil Conspiracy
There is no merit to Respondent’s conspiracy claim. Under Maryland law there is no
separate cause of action for a conspiracy, absent some other tortious conduct and injury, of
which there was none. See Lloyd v. GMC, 916 A.2d at 284; see also Tr. 690 (Respondent
testified conspiracy claim did not add anything, but just another “lever”).
(j)
Disgorgement
Respondent failed to cite any authority that prohibited the employment of members or
their children as pool staff. In any event, a third-party contractor (Georgetown Aquatics), not
Palisades, was the entity that hired and paid pool staff, and it was not named as a party to the
lawsuit. See BX 71 at 16-17 (Bryan Aff. ¶ 5); BX 71 at 60 (L. Wandner Aff. ¶ 4-5); BX 71
at 65-66 (I. Wandner Aff. ¶ 4). Nothing in the Palisades rules or by-laws prohibits this practice.
See BX 71 at 16-17 (Bryan Aff. ¶ 5). Respondent testified that he included this claim to “cause
Bryan’s buzzer to go off”; Respondent thought that that claim would make Mr. Bryan “collapse”
because he didn’t want his “little kid and his name dragged” into the litigation. Tr. 692-93.
Accordingly, we conclude that Bar Counsel has proved by clear and convincing evidence
that Respondent violated Rule 3.1 in filing suit against Palisades.
B.
Bar Counsel Proved By Clear and Convincing Evidence that Respondent
Violated Rules 3.2 and 4.4
D.C. Rule of Professional Conduct 3.2(a) provides that “[i]n representing a client, a
lawyer shall not delay a proceeding when the lawyer knows or when it is obvious that such
action would serve solely to harass or maliciously injure another.” D.C. Rule of Professional
Conduct 4.4(a) provides in relevant part that “[i]n representing a client, a lawyer shall not use
means that have no substantial purpose other than to embarrass, delay, or burden a third person.”
We find that Respondent violated both rules in Christie’s and Rule 4.4(a) in Palisades.
74
1.
Respondent Violated Rules 3.2(a) and 4.4(a) in Fastov v. Christie’s
Respondent litigated many issues in Fastov v. Christie’s beyond any reason. In light of
his pre-suit threats to engage in “confrontational and disruptive tactics” if Christie’s did not settle
with him (see ¶ 42, supra), we can only conclude that Respondent intended to harass Christie’s
and increase its burden through his aggressive litigation (and re-litigation) of even frivolous
issues. As is fully described above, Respondent:
•
sought discovery that exceeded the scope of any reasonable dispute
that he might have had with Christie’s (see ¶ 46, supra);
•
filed a motion for reconsideration of Magistrate Judge Robinson’s
Order denying his motion to compel discovery, supported by a
memorandum and a supplemental memorandum (see ¶ 47, supra);
•
while his motion for reconsideration was pending, Respondent
filed another motion, arguing that the crime/fraud exception
applied to eliminate Christie’s attorney-client privilege and workproduct protections, resulting in still more briefing (see ¶ 47,
supra);
•
with counsel, filed a 59-page opposition memorandum to the
summary judgment motion, attaching a 90-page declaration, a 461page statement of disputed and undisputed facts, and three volumes
of exhibits totaling 1,500 pages (see ¶ 48, supra); and,
•
filed a 45-page memorandum opposing Christie’s request for legal
fees, a supporting 26-page declaration, and hundreds of pages of
exhibits (see ¶ 63, supra).
2.
Respondent Violated Rule 4.4(a) in Fastov v. Palisades
As discussed above, there was absolutely no merit to Respondent’s Complaint against the
Palisades Board. Respondent testified that, as a result of the allegations contained in the July 13,
2004 letter, he had a “Sword of Damocles” over his head because he believed that he had been
called a “sexual pervert, pederast, pedophile, assaulter and batterer.” See Tr. 563-69. But that
had not happened; he had not been called a “sexual pervert, pederast, pedophile, assaulter and
batterer.” He had simply received a letter warning him to refrain from behavior that others,
including members of the Board, found to be inappropriate. Unlike Christie’s, where we have
75
found that Respondent could have reasonably misunderstood the reason for Dr. Frödl’s refusal to
provide an authenticity position, we see no basis for a reasonable misunderstanding here.
Respondent had no reasonable basis for thinking that the Board had accused him of being a
“sexual pervert,” etc. Instead, Respondent was simply mad that he had received the letter, and
that the Board had refused to “take it back.” Although Respondent argues strongly that he “was
dying to get this thing settled,” as a practical matter, there was no “thing” to settle. The Board
sent a warning letter, but took no other action.
Accordingly, we find that Respondent’s conduct was intended solely to harass, embarrass
and burden the Palisades Board and its members, and thus, violated Rule 3.2.
3.
Respondent’s Pre-litigation Letters Did Not Violate Rule 4.4(a)
Bar Counsel also argues that Respondent violated Rule 4.4 by “his harassment of officials
of Christie’s and Palisades and others to whom he sent lengthy, derogatory and threatening
letters.” Bar Counsel’s Post-Hearing Brief at 62. In making this argument, Bar Counsel relies
only on a single South Carolina case. In re White, 707 S.E.2d 411, 414 (S.C. 2011). Although
White found a Rule 4.4 violation on the basis of a derogatory and insulting letter written by a
lawyer, it is not clear that White applies here because the lawyer in White was representing a
client, and Respondent was complaining on his own behalf. As we find no other precedent for
finding a Rule 4.4 violation based purely on pre-litigation letters written on the lawyer’s own
behalf, we find no Rule 4.4(a) violation for pre-litigation letter writing.
4.
Summary
We find that Respondent violated Rule 3.2(a) and 4.4(a) in Christie’s even though he
may have had colorable claims, because he litigated in a manner designed and intended to
increase the burden and cost of litigation. We find that Respondent violated Rule 4.4(a) in
76
Palisades because he had no colorable claims, and instead used the litigation process itself to
inflict damage on the defendants. We find that Respondent’s pre-litigation letters did not violate
Rule 4.4(a).
C.
Bar Counsel Proved By Clear and Convincing Evidence That Respondent
Violated Rule 3.4(c) in Christie’s by Filing Papers That Violated Rules and
Orders Regarding Limits on Briefs
Under the plain language of Rule 3.4(c), in order to prove a violation, Bar Counsel must
prove that Respondent “[k]nowingly disobey[ed] an obligation under the rules of a tribunal.”
See D.C. Rule of Prof. Conduct 3.4(c). The term “knowingly” “denotes actual knowledge of the
fact in question.” See D.C. Rule of Prof. Conduct, Terminology, ¶ 6; see also In re Spitzer, 845
A.2d 1137, 1138 n.3 (D.C. 2004) (Respondent could not “knowingly” violate Rule 8.1(b)
without actual knowledge of a Bar Counsel investigation). Thus, in order to prove a Rule 3.4(c)
violation, Bar Counsel must prove that Respondent knew of the rule(s) allegedly violated. We
find that Bar Counsel proved by clear and convincing evidence that Respondent violated Rule
3.4(c) in two instances: 1) when his supporting motion papers contained more than 45 pages of
argument, which were included in argumentative “exhibits” attached to 45-page memoranda; and
2) when he formatted a memorandum in a manner intended to avoid a judicially-ordered page
limit. We find that Bar Counsel did not prove the other alleged Rule 3.4(c) violations by clear
and convincing evidence.
1.
Respondent’s Argumentative “Exhibits”
Respondent knew that a 45-page limit applied to memoranda filed in support of motions
in D.C. federal court.
See Tr. 538.
Respondent tried to exceed that limit by attaching
argumentative “exhibits” to his memoranda, as if the name given the document was sufficient to
bring it outside the 45-page limit. See e.g., RX 15a and 15d (argument supporting Respondent’s
77
August 8, 2000 motion for leave to file a surreply); RX 17j (argument supporting Respondent’s
January 19, 2001 surreply); BX 30 at 51-76 (argument supporting Respondent’s opposition to
Christie’s attorneys’ fees motion); BX 47 at 53-66 (argument supporting reply in support of his
objection to Magistrate Judge Kay’s Report and Recommendation). It appears that Respondent
believes that he was permitted to do anything not expressly prohibited by the rules. Indeed,
Respondent made just that argument in his December 2007 letter to Judge Friedman:
The U.S. District Court’s [Local Civil Rules] do not impose a page
limitation on memorandum documents other than those supporting
a motion, per LCvR 7 and 10(a). However, if such Judges of this
Court wanted to circumscribe these documents other than the
motion memorandum by page and other limitations and these
drafting principles, including the extensive use of footnotes and
single space block quotations, they could easily have done so in
their [Local Civil Rules]. They have not done so.
RX 42 at 8. We disagree. It is simply impossible to read the rules as prohibiting a 60-page
memorandum, but allowing a 45-page memorandum attached to which is a “declaration”
containing fifteen additional pages of argument, a result that Respondent’s interpretation of the
rules would allow. Respondent used this tactic to avoid the 45-page limit in several instances.
See BX 20, BX 40, BX 45, RX 15, RX 15d, RX 25d-e, RX 38c.
2.
Respondent’s January 19, 2001 Surreply
On November 16, 2000, Judge Friedman allowed Respondent to file a surreply that did
not exceed 25 pages, and that complied with specific instructions on the font style, font size, and
spacing of the memorandum and accompanying exhibits, including an instruction that any
declaration by Respondent not exceed 20 pages. BX 19 at 2-3. Respondent filed his surreply on
January 19, 2001. BX 20. This surreply did not comply with Judge Friedman’s Order because
Respondent dramatically reduced the size of the margins, and placed most of the text in footnotes
(which could be single spaced), in order to come within the 25 page limit. Indeed, seven pages
78
of the 25 page brief contained five or less lines of double spaced text, including two pages that
were comprised entirely of footnote text. See BX 20, at 9-12, 14-15, and 29. This is another
example of Respondent’s belief that he was permitted to do anything not expressly prohibited by
Judge Freidman’s Order.
See Tr. 857 (Respondent testified that his surreply “absolutely”
complied with Judge Friedman’s Order “because there are no rules that deal with (a) exhibits; (b)
declarations; and (c) footnotes, density or number.”) Again, we disagree. Although Judge
Friedman’s Order did not dictate every possible variable that could affect the length of a brief, it
is clear to the Hearing Committee that he authorized Respondent to file a 25-page brief of the
type Respondent typically filed. That is, one with standard margins, and some text in footnotes.
We find that Respondent intentionally violated this order because he clearly changed the format
used when filing other briefs, so that this one fit within the 25-page limit. Compare BX 20 with
BX 6 and BX 7. Respondent’s conduct in altering the format of the brief, leaves us with the firm
conclusion that he “knowingly” violated the order.
3.
Bar Counsel’s Other Alleged Violations
As for the remainder of Bar Counsel’s alleged Rule 3.4(c) charges, we do not believe that
Bar Counsel has proved a violation by clear and convincing evidence.
Bar Counsel argues that Respondent violated Rule 3.4(c) by filing a 225-page Complaint
in Christie’s, which violated Fed. R. Civ. P. 8(a)’s requirement that a complaint contain “a short
plain statement of the claim showing that the pleader is entitled to relief.” Bar Counsel’s PostHearing Brief at 60. We cannot find that Respondent “knowingly” violated Rule 8(a) because
there is no evidence that Respondent knew that the Complaint was longer than it should have
been, yet filed it anyway.
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Bar Counsel argues that Respondent violated Rule 3.4(c) by violating Fed. R. Civ. P. 11
and Fed. R. App. P. 38, by “bringing and then pursuing frivolous claims and appeals, and doing
so in bad faith and to retaliate against Christie’s for an imagined slight.” Bar Counsel’s PostHearing Brief at 60-61. We reject Bar Counsel’s argument, which would require that we find
that Respondent intentionally violated Rules 11 and 38. As discussed above, while we believe
that Respondent brought claims that were objectively meritless (the time-barred claims and the
intentional infliction of emotional distress claim), Bar Counsel has not proven by clear and
convincing evidence that Respondent knew that he did have a good faith basis for bringing the
claims. Thus, we cannot find that he “knowingly” violated Rule 11.
D.
Bar Counsel Proved By Clear and Convincing Evidence That Respondent
Violated Rule 8.4(d) Because His Conduct Seriously Interfered with the
Administration of Justice in the Courts that Handled His Suits
D.C. Rule of Professional Conduct 8.4(d) provides that it is professional misconduct for
a lawyer to “[e]ngage in conduct that seriously interferes with the administration of justice.”
Rule 8.4(d) is “a general rule that [was] purposely broad to encompass derelictions of attorney
conduct considered reprehensible to the practice of law.” In re Hopkins, 677 A.2d 55, 59 (D.C.
1996) (quoting In re Alexander, 496 A.2d 244, 255 (D.C. 1985) (interpreting analogous DR 1102(A)(5)); see also Comment [2] to Rule 8.4 (containing examples of violative conduct, and
noting that “Paragraph (d) is to be interpreted flexibly.”).
The Court of Appeals has consistently applied a three-part test to Rule 8.4(d) cases: first,
the conduct must be improper; second, the conduct must “itself bear directly on the judicial
process”; and, third, the conduct “must taint the judicial process in more than a de minimis way;
that is, at least potentially impact upon the process to a serious and adverse degree.” See In re
Hopkins, 677 A.2d at 60-61; In re Travers, 764 A.2d 242, 248 (D.C. 2000); accord In re
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Uchendu, 812 A.2d 933, 941 (D.C. 2002).
A Rule 8.4(d) violation does not require an
interference with judicial decision-making “that causes the court to malfunction or make an
incorrect decision.” Hopkins, 677 A.2d at 60.
The foregoing discussion of Respondent’s
misdeeds makes it clear that his conduct seriously interfered with the administration of justice.
Respondent’s conduct easily satisfies the Hopkins test because Respondent used the
judicial system itself to harass Christie’s and the Palisades Board. As discussed above, we find
that Respondent did not have a valid basis to pursue certain claims against Christie’s, or any
claims against Palisades, and that he pursued those claims simply to cause the defendants to bear
the burden of litigation, so that they would “lose” financially, even if they won on the merits.
Respondent filed a tremendous amount of paper with the courts (in order to make litigation as
difficult as possible for his adversary), and in doing so, he unnecessarily burdened not only his
opponent, but also the courts. Respondent’s pursuit of frivolous claims and frivolous issues
wasted the time and resources of the courts involved. See In re Spikes, 881 A.2d 1118, 1127
(D.C. 2005); In re Shieh, 738 A.2d 814, 818 (D.C. 1999). There can be no dispute that
Respondent’s behavior affected the judicial system in more than a de minimis way.
SANCTION
Bar Counsel seeks a three-year suspension with a fitness requirement. Bar Counsel PostHearing Brief at 67. Respondent argues that he should not be sanctioned. Respondent’s PostHearing Response at 68.
The imposition of sanctions in bar disciplinary matters “is not an exact science but may
depend on the facts and circumstances of each particular proceeding.” In re Goffe, 641 A.2d at
463. The facts and circumstances generally considered include: (1) the nature and seriousness
of the misconduct; (2) the prejudice, if any, to the client that resulted from the misconduct; (3)
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whether the conduct involved dishonesty or misrepresentation; (4) the presence or absence of
violations of other ethical rules; (5) whether the lawyer has had prior discipline; (6) whether the
lawyer acknowledges his wrongful conduct; and, (7) any circumstances in mitigation of the
misconduct. Pelkey, 962 A.2d at 281. We treat these factors below. In doing so, we are
cognizant that the discipline we recommend “should serve not only to maintain the integrity of
the profession and to protect the public and the courts, but also to deter other attorneys from
engaging in similar misconduct.” In re Reback, 513 A.2d 226, 231 (D.C. 1986) (en banc).
A.
Seriousness, Multiple Violations
Respondent abused his knowledge of the legal system to pursue meritless claims against
Christie’s and Palisades. As discussed above, while Respondent may have had a colorable claim
against Christie’s, he did not litigate just the colorable claim, instead, he attempted to make good
on his promise to bring about Christie’s “unconditional surrender.” As to Palisades, there were
no colorable claims. The entire lawsuit was conducted in order to make the Palisades Board
members suffer because they had privately admonished him.
As Respondent notes, because he represented himself and not a client, he could have
done all of these things had he not been a member of the Bar; however, we do not believe that
that makes his conduct any less serious. See Respondent’s Post-Hearing Surreply at 33. He
caused his opponents to spend hundreds of thousands of dollars in legal fees defending against
meritless claims and responding to his tactics. There can be no doubt that these tactics were used
to increase the burden on Respondent’s opponents because he threatened just that in his pre-suit
letters.
B.
Prejudice to the Client
This factor is neutral, as Respondent represented himself, not a client.
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C.
Prior Discipline
Respondent has no prior discipline.
D.
Acknowledgement of Wrongdoing
Respondent has not acknowledged that much of his conduct was beyond the pale. He
appears to have no remorse for his conduct, and indeed, does not even appear to understand that
his conduct was wrong and caused harm to others. Instead, in his discussion of sanction, he
attempts to blame Judge Stafford and Christie’s counsel:
[Judge Stafford] issued 5 egregiously erroneous Orders, upon
which [Bar Counsel] sought to premise [Bar Counsel’s] case,
which were a direct product of [Judge Stafford’s] bias and
prejudice induced by Christie’s counsels’ unethical, inflammatory,
untimely and irrelevant Notice of Filing of 2/16/06 and [Judge
Stafford’s] overweening desire to punish Fastov and obtain
vengeance with a $630,043.32 award. Palisades and Christie’s
conspired together to induce bias and prejudice against Fastov in
both judges.
Respondent’s Post-Hearing Response at 68 (citations omitted). Respondent also argued that he
should not be sanctioned for writing “a ‘garden variety’ pre-litigation ‘lawyer’s letter’ seeking
settlement with an opposing party, while threatening litigation,” because a lawyer’s fear of
sanctions from such a letter might have a chilling effect on pre-litigation efforts to resolve
disputes, and result in more suits in court rather than less. Respondent’s Post-Hearing Surreply
at 33. We reject this argument. As discussed above, Respondent did not just write a threatening
letter, he followed the letter with baseless claims and conduct intended solely to increase his
opponent’s litigation burden. 20
20
This argument, that Respondent should not be sanctioned because other lawyers engage
in similar conduct (i.e., writing demand letters, filing surreplies and motions for reconsideration,
etc.), shows that Respondent does not appreciate the scope of his wrongdoing. He was far
beyond a zealous advocate. He used the judicial system itself as a means of inflicting harm on
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E.
Circumstances in Mitigation
In mitigation, Respondent argued that Judge Stafford’s $630,000 monetary sanction is
punishment enough, and any further sanction would be “piling on.” Respondent’s Answer at
296. Respondent cites no authority that suggests that Judge Stafford’s sanction should serve to
mitigate his sanction here. He also argued that he had an unblemished record while employed as
a government attorney from 1972-1985, an argument that Bar Counsel does not appear to
contest. We do not believe that this mitigates his misconduct.
F.
Protection of the Public and the Courts
Respondent clearly burdened the court system with meritless litigation, which he pursued
beyond any reason. Respondent’s desire to make his adversaries bear the litigation burden had
the perhaps unintended, but unavoidable consequence of burdening the courts. Simply put, the
courts should not have had to deal with most of the issues that Respondent, or his conduct,
brought before them. Courts are not a tool to be used to attempt to punish the other side.
Finally, although no clients were harmed here, Respondent harmed the defendants in
Christie’s and Palisades, and we think that his sanction should reflect a desire to protect the
public from meritless suits brought and prosecuted by lawyers bent on vengeance.
RECOMMENDATION AS TO SANCTION
As Bar Counsel correctly notes, there are no original cases involving comparable conduct
that did not also involve other serious issues. See Bar Counsel Post-Hearing Brief at 66-67. We
reach our recommendation of an 18-month suspension by comparing the facts of this case to
those in a reciprocal discipline case that presented a similar pattern of abusive litigation tactics:
In re Shieh, 738 A.2d 814 (D.C. 1999).
others. We are not concerned that our recommendation here will have any chilling effect on
lawyers who bring claims and litigate issues in good faith.
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Like Respondent, Shieh was disciplined for his conduct in cases he brought on his own
behalf. Specifically, Shieh filed multiple lawsuits in state and federal courts, and, in the words of
the California State Bar Court “he established himself as the benchmark by which all vexatious
litigants in the state of California will be judged.”
738 A.2d at 814.
Although Shieh’s
misconduct led to his disbarment in California, the D.C. Board on Professional Responsibility
recommended that Respondent not be disbarred in the District of Columbia, but rather, be
suspended for two years, with a fitness requirement, and enjoined from filing suit without prior
court approval. 738 A.2d at 818. The Court of Appeals rejected the Board’s recommendation,
and disbarred Shieh because California had found that Shieh had committed repeated acts of
moral turpitude: “respondent’s habitual, bad faith misuse of the judicial process—resulting in
several convictions for criminal contempt—was suffused with moral turpitude.” Id. at 818.
While we find that Respondent’s conduct deserves to be sanctioned, we do not find that it
constitutes “moral turpitude,” because “to rise to the level of moral turpitude, an attorney’s
conduct must be an act of ‘baseness, vileness, or depravity,’ or be the type that manifests ‘a
revulsion of society toward conduct deeply offending the general moral sense of right and
wrong.’” In re Allen, 27 A.3d 1178, 1184 (D.C. 2011). Simply put, we do not believe that
Respondent’s conduct is equal to Shieh’s conduct, which a California court described as follows:
Respondent was “at war” with the courts, individual judges, his
former law firms, and attorneys who were his ex-employees.
Three tactics were used primarily by Respondent in directing his
attorneys. First, he moved between federal and state court when he
felt that the judge in a given case was inclined to rule against him
—dismissing the case in one court and refiling it in the other
jurisdiction. Second, he filed peremptory challenges or recusal
motions. Third, he filed premature notices of appeal. In his efforts
to disqualify Judge Kakita, Respondent did not hesitate to accuse
him of judicial misconduct without any basis in fact or law, but “as
purely a vindictive matter.”
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738 A.2d at 830. Shieh also refused to cooperate in discovery, at one point filed twelve motions
for reconsideration, which were denied because they were identical to six previously-denied
motions for reconsideration, and was held in contempt for violating an automatic litigation stay
imposed after he was declared a vexatious litigant. Id. at 824, 831-32.
We recommend that Respondent be suspended for 18 months because in Shieh, the most
closely factually analogous case, the Board recommended only a two year suspension for Shieh’s
vexatious litigation, which was worse than Respondent’s conduct.
The Court of Appeals
rejected that recommendation, after concluding that the Board did not appreciate that California
disbarred Shieh because his “repeated acts of moral turpitude demonstrate that he is no longer
worthy of membership in the bar.” Shieh, 738 A.2d at 819.
As we do not believe that
Respondent here engaged in “repeated acts of moral turpitude,” we do not believe that the Court
of Appeals’ decision to impose reciprocal discipline is dispositive on the length of the suspension
here, which turns on vexatious litigation conduct.
Instead, we rely on the Board’s
recommendation of a two-year suspension as an appropriate suspension for extraordinarily
vexatious conduct that is not “suffused with moral turpitude.” Id. at 818. As Shieh’s conduct
appears to be far worse than Respondent’s due simply to its greater volume, we believe that
Respondent’s sanction here should be less than two years recommended by the Board in Shieh.
In addition, we recommend that, following his suspension, Respondent be required to
prove his fitness to practice law. We make this recommendation because we find that the
evidence admitted at the hearing, and Respondent’s performance before, during, and after the
hearing, are clear and convincing evidence that “casts a serious doubt” upon Respondent’s
continuing fitness to practice law. In re Cater, 887 A.2d 1, 24 (D.C. 2005). While that is a high
standard, the evidence here easily surpasses it.
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Respondent brought frivolous claims against Christie’s and Palisades because he believed
that he could punish the defendants by making them incur the cost of litigation. Rather than “aid
in the administration of justice as an attorney and an officer of the Court,” Respondent used the
justice system as a weapon, not as a means of resolving a legitimate dispute. See D.C. Bar Rule
XI, §2(a).
We understand that recommending a fitness requirement usually “turns on a partly
subjective, predictive evaluation of the attorney’s character and ability.” Cater, 877 A.2d at 22.
In assessing whether a fitness requirement is warranted, we may consider: (1) the nature and
circumstances of the misconduct; (2) whether the attorney recognizes the seriousness of his
misconduct; (3) the attorney’s conduct subsequent to the misconduct at issue; (4) the attorney’s
present character; and, (5) the attorney’s present qualifications and competence to practice law.
Id. at 25 (citing In re Roundtree, 503 A.2d 1215, 1217 (D.C. 1985)). Here, Respondent engaged
in serious misconduct that relates directly to his ability to appear as an advocate in court. He
does not recognize the seriousness of his misconduct (choosing instead to blame others), and his
conduct in Palisades shows that his conduct in Christie’s was not an isolated incident.
Most importantly, as to the final factor, we have extensive, objective proof of
Respondent’s inability to practice law: his repeated admissions. Respondent represented in his
Answer that he has “absolutely no intention, inclination, desire or physical or mental capacity to
engage in litigation of any kind or practice of law in the future,” (Respondent’s Answer at 302),
that his health-related problems “could cause [him] to make a legal errors [sic], which could hurt
a client and subject [him] to malpractice claims,” (id. at 303), that he has “no intent or capacity
to use in the future my D.C. Bar license to earn income from litigation or other practice of law,”
(id. at 300); and that he told Bar Counsel that he “hated the practice of law and had absolutely no
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capacity or intention to practice law to generate any income for the rest of his life.” Id. at 297.
In his Post-Hearing Surreply, while arguing that a suspension with a fitness requirement would
be a “waste” because inter alia he could “represent himself pro se notwithstanding any
suspension,” 21 Respondent confirms that a fitness requirement is necessary because he does not
see how he could meet the fitness requirement, “assuming he would want to practice law, which
he clearly does not want to do and cannot do.” Respondent’s Post-Hearing Surreply at 33; see
also id. (Respondent has no capacity to earn income practicing law). We do not accept these
admissions blindly. Instead, they confirm the conclusion that we would have reached on our
own: that Respondent currently lacks the ability to practice law.
This recommendation seems well within the range of sanctions imposed on counsel who
engage in frivolous litigation. For instance, in In re DeMaio, respondent had been disbarred in
Maryland for, inter alia, making “false, spurious and inflammatory representations and
allegations” against the Chief Judge and Clerk of the Maryland Court of Special Appeals. 893
A.2d 583, 584 (D.C. 2006). DeMaio first made these allegations after the Chief Judge issued an
order to show cause why an appeal should not be dismissed as premature. Id. Respondent then
filed a series of motions “in which he took progressively more outlandish positions.” Id. The
D.C. Court of Appeals declined to impose reciprocal discipline because the District of Columbia
“handles disciplinary actions arising from an attorney’s personal attacks on a judge or court
officer differently from our sister jurisdiction of Maryland.” DeMaio, 892 A.2d at 587. Instead,
the Court of Appeals found that Respondent had violated Rules 1.1, 3.1 and 8.4(d), and imposed
an 18-month suspension with a fitness requirement. Id. at 589.
21
We understand that, as a practical matter, the disciplinary system cannot prevent
Respondent from representing himself in court; however, the recommended suspension and
fitness requirement will “prevent him from continuing his abusive conduct under the cloak of
authority conferred on him by his membership in the bar.” Shieh, 738 A.2d at 819.
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We believe that the conduct at issue here is more serious than that presented in In re
Spikes and In re Thyden. In Spikes, the respondent received a 30-day suspension for violating
Rules 3.1 and 8.4(d) by bringing a defamation action based on non-actionable communications.
881 A.2d at 1126-27, 1127 n.9. In Thyden, the respondent made frivolous filings in a bankruptcy
proceeding, which violated Rule 8.4(d). 877 A.2d 129, 142-43 (D.C. 2005). Thyden was
suspended for 30 days for this conduct and for neglecting a client matter. Id. at 144-45. We
recommend a sanction longer than that imposed in either Spikes or Thyden because Respondent’s
abusive and vexatious litigation conduct was part of a strategy for dealing with Christie’s and
Palisades.
He threatened that he would make them suffer if they did not give in to his
unreasonable demands, and he used burdens inherent in litigation to make good on that threat.
Moreover, Respondent brought unmeritorious claims and pursued unmeritorious issues literally
to the United States Supreme Court. We believe that his conduct warrants a longer suspension
than that imposed in either Spikes or Pelkey.
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CONCLUSION
For the foregoing reasons, the Ad Hoc Hearing Committee recommends that Respondent
be suspended from the practice of law for 18 months and that, as a condition of reinstatement, he
be required to establish his fitness to practice law pursuant to D.C. Bar Rule XI, § 16.
AD HOC HEARING COMMITTEE
____/JTP/___ _______________________
James T. Phalen, Esquire, Chair
____/SK/____________________________
Ms. Suzanne Kramer
_____/CSD/_________________________
Catherine S. Duval, Esquire
Dated: January 5, 2012
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