On August 1, 2018, Justice Ramos of the New York County Commercial Division issued a decision in Citigroup Global Markets, Inc. v. Fiorilla, 2018 NY Slip Op. 31919(U), sanctioning a litigant for frivolous litigation, including awarding attorneys’ fees for defending against the frivolous claims, explaining:
Uniform Rule 130-1.1 vests this Court with discretion to award both attorneys’ fees, costs and sanctions as a result of frivolous conduct. Conduct is frivolous if (1) it is completely without merit in law and cannot be supported by a reasonable argument for an extension, modification or reversal of existing law; (2) it is undertaken primarily to delay or prolong the resolution of the litigation, or to harass or maliciously injure another; or (3) it asserts material factual statements that are false.
Courts also consider whether the conduct was continued when it became apparent, or should have been apparent, that the conduct was frivolous, or when such conduct was brought to the attention of the parties or to counsel. Simply because an argument fails to persuade the court does not necessitate a finding of frivolous conduct.
Throughout this litigation, Fiorilla has pursued a relentless campaign to circumvent this Court’s final judgment by attempting to re-litigate already decided matters. He has prolonged this litigation and compelled CGMI to expend significant resources, both in New York and in France. Both the French proceedings and the OSC were frivolous and completely without merit. Thus, the record establishes that Fiorilla’s outrageous conduct merits the imposition of sanctions, and an award of reasonable attorneys fees.
Fiorilla’s frivolous conduct included making inaccurate and incomplete factcal assertions in the French proceedings. To obtain ex parte recognition of the Award in France, Fiorilla submitted a copy of the Award, and omitted the critical fact that this Court had already vacated the Award and entered a final judgment, which was affirmed on appeal. Fiorilla even used the already vacated Award to attempt to seize CGMI’s assets in France.
Fiorilla’s subsequent OSC to vacate the Award was also frivolous. This is not a simply a circumstance where an argument failed to persuade the Court. Rather, Fiorilla and his counsel rehashed arguments in duplicative proceedings that had already been deemed to lack legal merit by this Court and on appeal. Fiorilla cited no new arguments or evidence in support that warranted reconsideration. Mr. Fiorilla. persisted in this conduct despite repeated warnings by this Court and the First Department.
The Court wholly rejects Fiorilla’s assertion that his conduct was not in bad faith. Fiorilla’s opposition to the motion largely ignores the factual record and repeated admonishments, both by this Court and by the First Department pertaining to his conduct.
(Internal quotations and citations omitted).
Part of being a good litigator is thinking of winning arguments other lawyers miss. However, as this decision shows, courts have little patience for lawyers who cross the line from creative to making frivolous arguments. Contact Schlam Stone & Dolan partner John Lundin at firstname.lastname@example.org if you or a client has a question regarding whether an argument has crossed the line from creative to sanctionable.
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