Commercial Division Blog

Posted: April 9, 2020 / Categories Commercial, Law Firms and Professional Ethics

Judiciary Law 487 Does Not Cover Non-Meritorious Legal Arguments

On March 31, 2020, the Court of Appeals issued a decision in Bill Birds, Inc. v. Stein Law Firm, P.C., 2020 NY Slip Op. 02125, holding that Judiciary Law 487 does not cover non-meritorious legal arguments, explaining:

Under Judiciary Law § 487(1), an attorney who is guilty of any deceit or collusion, or consents to any deceit or collusion, with intent to deceive the court or any party is guilty of a misdemeanor and may be liable to the injured party for treble damages in a civil action. In our decisions in Amalfitano v Rosenberg (12 NY3d 8 [2009]) and Melcher v Greenberg Traurig, LLP (23 NY3d 10 [2014]), we examined the ancient origins of section 487, noting that the claim could be traced back to old English common law and was first codified in 1275. The original statute made it a criminal offense for a "Pleader" to engage in "Deceit or Collusion in the King's Court". The law was carried over to colonial New York and, as early as 1787, a New York statute similarly stated that any attorney guilty of deceit or collusion in any court of justice" shall be punished. Virtually identical language proscribing intentional deceit by attorneys was codified in both the civil and penal law in the 1800s, and subsequently transferred to the Judiciary Law in 1965.

Similar to fraud, Judiciary Law § 487—covering intentional deceit and collusion—imposes liability for the making of false statements with scienter. But in light of the history of the statute, we concluded in Amalfitano that Judiciary Law § 487 is not a codification of common law fraud and therefore does not require a showing of justifiable reliance (id. at 12, 14). In other words, liability under the statute does not depend on whether the court or party to whom the statement is made is actually misled by the attorney's intentional false statement. Given the requirement that the conduct involve deceit or collusion and be intentional, liability under the statute does not extend to negligent acts or conduct that constitutes only legal malpractice, evincing a lack of professional competency. Indeed, because a violation of section 487 is a crime, we must be circumspect to ensure that penal responsibility is not extended beyond the fair scope of the statutory mandate.

In Looff v Lawton, this Court held, under a predecessor statute that employed substantially the same language now found in Judiciary Law § 487(1), that allegations that an attorney provided false and untrue legal advice to induce plaintiffs to bring an unnecessary lawsuit, motivated solely by the attorney's desire to collect a large fee, did not state a claim because the statute applied only to conduct that occurs in the context of an action pending in a court—not misleading advice preceding an action. We explained that, because the purported deceit occurred before the judicial action was commenced, there was no court or party to be deceived within the meaning of the statute. In contrast, the conduct underlying the claim in Amalfitano—the making of a false statement of fact in the complaint regarding the client's partnership status in a family business—fell squarely within the scope of the statute because the misrepresentations at issue there were made in the context of an action pending in court.

As reflected in our decisions in Looff and Amalfitano, the purpose of Judiciary Law § 487(1) is to safeguard an attorney's special obligation of honesty and fair dealing in the course of litigation—a pillar of the profession. Our legal system depends on the integrity of attorneys who fulfill the role of officers of the court, furthering its truth-seeking function. Thus, the statute is limited to a peculiar class of citizens, from whom the law exacts a reasonable degree of skill, and the utmost good faith in the conduct and management of the business entrusted to them. To mislead the court or a party is to deceive it; and, if knowingly done, constitutes criminal deceit under the statute. Moreover, the language of the statute is aimed at a particular type of deceit or collusion—done by an attorney with the intent to mislead the court or a party. While attorneys must zealously advocate for their clients, such deception or collusion is antithetical to appropriate advocacy, functioning as a fraud on the court or a party. Given the statute's origins and purpose, it provides a particularized civil remedy, and criminal liability, for a specialized form of attorney misconduct occurring during the pendency of litigation.

Here, viewing the facts in the light most favorable to plaintiffs, defendants established prima facie entitlement to judgment as a matter of law on the Judiciary Law § 487(1) claim by demonstrating that plaintiffs failed to allege that defendants engaged in deceit or collusion during the course of the underlying federal intellectual property lawsuit against GM and EMI. In response, plaintiffs failed to satisfy their burden to establish material, triable issues of fact. The affidavits plaintiffs submitted in opposition to summary judgment did not allege that defendants committed any acts of deceit or collusion during the pendency of the underlying federal lawsuit. To the extent defendants were alleged to have made deceitful statements, plaintiffs' allegation that defendants induced them to file a meritless lawsuit based on misleading legal advice preceding commencement of the lawsuit is not meaningfully distinguishable from the conduct we deemed insufficient to state a viable attorney deceit claim in Looff (97 NY at 482). The statute does not encompass the filing of a pleading or brief containing nonmeritorious legal arguments, as such statements cannot support a claim under the statute. Similarly, even assuming it constituted deceit or collusion, defendants' alleged months-long delay in informing plaintiffs that their federal lawsuit had been dismissed occurred after the litigation had ended and therefore falls outside the scope of Judiciary Law § 487(1). Thus, plaintiffs' Judiciary Law § 487 cause of action was properly dismissed.

(Internal quotations and citations omitted).

Part of being a good litigator is thinking of winning arguments other lawyers miss. However, courts have little patience for lawyers who cross the line from creative to making frivolous arguments or who attempt to mislead the court. Contact Schlam Stone & Dolan partner John Lundin at if you or a client has a question regarding whether a lawyer has crossed the line from creative to sanctionable.