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An ex-vice president of Fox News Latino lost an appeal of the dismissal of his fraud claims against the network's owner, and now his attorney must convince the U.S. Court of Appeals for the Second Circuit that he should not face penalties for filing a frivolous appeal.

The panel in the case—composed of Circuit Judges Pierre Leval and Susan Carney, with District Judge Katherine Polk Failla of the U.S. District Court for the Southern District of New York sitting by designation—delivered setbacks to Francisco Cortes and also to his counsel, private attorney J.A. Sanchez-Dorta.

Cortes lost his appeal from a ruling by U.S. District Judge Robert Sweet that threw out his breach of contract, defamation and other claims against his former employer.

Meanwhile, Sanchez-Dorta was given 30 days to demonstrate why the court should not enter an award of damages, attorney fees and two times the allowable legal costs borne by Fox.

The lawsuit stemmed from an incident in which Cortes had been alleged to have sexually assaulted Tamara Holder, a Fox News contributor, in his office, in 2016. Cortes was dismissed shortly after the incident, and in February 2017, Fox settled with Holder over the matter for $2.5 million.

Cortes entered into a related agreement with Fox and Holder, in which he discharged any claims he might have against Holder. Holder, in turn, agreed to refrain from disparaging the “Released Party,” while Fox, Cortes, and another individual not identified in the papers agreed to the same with regard to Holder.

In March, new reports surfaced recounting Holder's allegations. Cortes then sued his former employer over a joint statement Fox and Holder issued to the press, claiming among other things that the statement defamed him, and that it represented a breach of the agreement.

Sweet dismissed the suit in district court in its entirety for failing to state a claim.

In its decision, the Second Circuit said Cortes waived claims to everything but one for fraudulent inducement.

Cortes argued that the agreement among the parties prevented Cortes from responding to the public statement in the press, and that Fox and Holder intentionally misrepresented their intention to comply with the agreement. Therefore, he reasoned that the trial judge wrongly dismissed the fraud claim, because it's possible to be defrauded by trickery or scheming.

The panel, however, noted the requirements for fraudulent misrepresentation under New York State law, including the knowledge that it was a false statement and the falsity of the representation, as well as the requirements required to pursues the claims in federal court. Not a single particular material statement, representation, or other action is identified as false or untrue in Cortes' filings, the panel said.

The panel also agreed with the district court that there was no plausible pleading by Cortes that he relied on Fox's representation, as a separate nondisparagement clause in a separation agreement signed before the settlement was in effect, covering Holder and other Fox News employees.

The “deeper problem” with Cortes' appeal, the panel stated, was that it was “patently frivolous.” The panel took issue with Cortes' “rambling brief” that presented “irrelevant factual allegations” that had “not the slightest bearing” on the dismissal by the district court.

“Instead of articulating a good-faith legal claim, Cortes's counsel appears to have used this appeal to engage in stream-of-consciousness speculation about Fox's allegedly nefarious motives for securing Cortes's signature on the Agreement, speckling his brief with impertinent references to popular books about the financial industry, the Spanish Inquisition, and, improbably, the Bolivian gas conflict of 2003,” the panel said.

Finding that Cortes' appeal now is frivolous and filed without the slightest chance of success, the panel ordered Sanchez-Dorta to show the court within 30 days why he should not pay damages, attorney fees and twice appellees' allowable costs.

Sanchez-Dorta, who identifies himself as a Harvard Law School graduate on his LinkedIn page, was further sanctionable, the panel noted, for revealing confidential discussions with opposing counsel and a court mediator in his brief on appeal. He did not respond to requests for comment.

The defendants were represented on appeal by Dechert partner Linda Goldstein. She did not respond to a request for comment.

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