Doscher v. Mannatt, Phelps & Phillips, LLP
148 A.D.3d 523
| N.Y. App. Div. | 2017Background
- Plaintiff Drew Doscher sued his former employers' counsel (Mannatt, Phelps & Phillips) under Judiciary Law § 487 (and § 478) alleging discovery abuses during a prior arbitration.
- The arbitration panel had twice denied Doscher's motions for sanctions based on the same alleged misconduct.
- Doscher had filed a separate petition to vacate the arbitration award, which remained pending.
- Supreme Court (NY County) granted defendants' motion to dismiss; plaintiff appealed.
- The Appellate Division, First Department affirmed the dismissal in a March 16, 2017 decision.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether collateral estoppel bars § 487 claim | Doscher contended the alleged discovery abuses in arbitration support a § 487 claim against opposing counsel | Defendants argued Doscher already litigated these issues before the arbitration panel and lost | Court: Collateral estoppel precludes Doscher's § 487 claim because he had a full and fair opportunity to litigate the issues in the arbitration sanctions motions |
| Whether an arbitration award is a final judgment for collateral estoppel while a vacatur petition is pending | Doscher argued the award was not final because his petition to vacate was pending | Defendants argued the arbitration award still qualified as a final, preclusive judgment | Court: Arbitration award constitutes a valid final judgment for collateral estoppel despite a pending vacatur petition |
| Whether Judiciary Law § 478 applies to attorney misconduct in arbitration | Doscher asserted § 478 covers deceit in arbitration proceedings | Defendants argued § 478 is limited to conduct deceiving "the court or any party" in judicial (not arbitral) or territorial contexts and must be narrowly construed | Court: § 478 does not apply to attorney misconduct during arbitral proceedings; it targets litigation before New York courts and should be narrowly interpreted |
| Whether plaintiff pleaded the elements of § 487 (intentional deceit and proximate damages) with required particularity | Doscher claimed his pleadings alleged egregious misconduct and scienter sufficient for § 487 | Defendants argued the alleged conduct was not egregious, lacked particularized scienter, and plaintiff had tactical alternatives (e.g., subpoena a third party) | Court: Pleading failed — allegations not sufficiently egregious or particularized to show intent and proximate damages; dismissal affirmed |
Key Cases Cited
- Bernard v. Proskauer Rose, LLP, 87 A.D.3d 412 (1st Dep't 2011) (collateral estoppel and § 487 context)
- Pentalpha Enters., Ltd. v. Cooper & Dunham LLP, 91 A.D.3d 451 (1st Dep't 2012) (sanctions litigation in arbitration context)
- Gillen v. McCarron, 126 A.D.3d 670 (2d Dep't 2015) (arbitral sanctions precedents)
- Acevedo v. Holton, 239 A.D.2d 194 (1st Dep't 1997) (arbitration awards as final judgments for preclusion)
- Franklin Dev. Co., Inc. v. Atlantic Mut. Ins. Co., 60 A.D.3d 897 (2d Dep't 2009) (same)
- People v. Thompson, 26 N.Y.3d 678 (2016) (narrow construction of statutes with criminal components)
- Amalfitano v. Rosenberg, 12 N.Y.3d 8 (2009) (statutory interpretation principles)
- Facebook, Inc. v. DLA Piper LLP (US), 134 A.D.3d 610 (1st Dep't 2015) (standards for § 487 pleading, scienter and egregiousness)
- Schertenleib v. Traum, 589 F.2d 1156 (2d Cir. 1978) (limitations of statutory reach to proceedings outside New York)