NY Appeals Court Upholds Fee Award to Fox, Proskauer in Discovery Dispute
The plaintiff in the lawsuit over control of a company was ordered to pay, as discovery-abuse sanctions against her, defense attorney fees billed by Fox Rothschild, Proskauer and Pelosi Wolf Effron & Spates.
December 20, 2018 at 11:51 AM
4 minute read
A plaintiff's challenge to the reasonableness of $136,000 in attorney fees she was ordered to pay to three law firms as discovery-abuse sanctions failed, thanks in part to testimony and detailed invoicing from the lawyers involved the case.
An Appellate Division, First Department panel also ruled, in its decision addressing various challenges made by Suzanne Mangold Zacharius to a court-appointed special referee's attorney sanctions, that her “contention that certain specific entries in defendants' [attorneys'] time records are excessive is improperly raised for the first time on appeal,” citing 1199 Hous. Corp. v. Jimco Restoration Corp.
“In any event,” the unanimous panel then noted in the decision, “as indicated, the Special Referee did not award defendants' attorneys 100% of the fees they requested.”
The opinion addressed challenges that underlying lawsuit-plaintiff Suzanne Zacharius made to Special Referee Steve Liebman's 2017 decision and order mandating that she pay $136,000 in reasonable attorney fees and costs incurred by defendants Kensington Publishing Corp., Steven Zacharius and Judith Zacharius.
Specifically, Suzanne Zacharius was ordered to pay $111,208 in defense attorney fees, including forensic computer vendor costs, billed by the New York office of Fox Rothschild; $18,000 billed by Proskauer in defense attorney fees; and $6,792 in defense attorney fees billed by Pelosi Wolf Effron & Spates in New York, according to Leibman's decision and order.
The underlying lawsuit, filed by Suzanne Zacharius in 2012, centers on an inter-family legal dispute over control of Kensington Publishing Corp.—and in 2017, Liebman levied against Suzanne Zacharius what he called discovery “spoliation sanctions” for conduct that he wrote included her intentionally deleting thousands of emails that might have been relevant and pertinent to the case.
The First Department panel, composed of Justices David Friedman, Barbara Kapnick, Troy Webber, Marcy Kahn and Cynthia Kern, knocked back Suzanne Zacharius' arguments over the correctness of the sanction-payable attorney fees at every turn.
The justices wrote that Liebman's determination on fees and costs was “supported by the record.”
“The evidence includes the testimony of the experienced attorneys who performed the relevant services and the invoices sent to the clients, which describe the services in detail and the time spent each day, and which, the attorneys testified, were prepared contemporaneously with the services rendered,” the justices wrote while citing Matter of Freeman.
And Suzanne Zacharius “failed to present any evidence that the time spent by defendants' attorneys was duplicative or unreasonable,” the justices added.
Addressing Suzanne Zacharius' contention that Liebman failed to analyze the evidence or cite the reasons for his fees determination, the panel wrote that his decision was sufficient because he “made it clear that, while defendants' attorneys' hourly rates were reasonable, not all of the claimed time spent was reasonable, and accordingly he awarded an amount significantly less than the amount requested.”
Next, the justices said that the court record belied Suzanne Zacharius' contention that, based on Liebman's statements regarding her conduct, he'd improperly imposed a punitive element when determining the sanction amount.
“The Special Referee's comments about plaintiff's misconduct were part of his general discussion of the background of the matter before him,” the justices wrote, adding that “as indicated, he significantly cut defendants' attorneys' request because he was skeptical of the claimed amount of time spent.”
Finally, the justices noted in their Dec. 6 opinion in Zacharius v. Kensington Publishing that Suzanne Zacharius' “contention that certain specific entries in defendants' time records are excessive is improperly raised for the first time on appeal.”
William Beslow, of the Law Office of William S. Beslow in New York, represented Suzanne Zacharius before the panel and could not be immediately reached for comment.
Daniel Schnapp, a Fox Rothschild partner in New York, who represented Kensington Publishing, Steven Zacharius and Judith Zacharius, also could not be reached.
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