Sandra C. BARKLEY, AKA Sandra C. Barklay, Plaintiff–Counter-Defendant-Cross-Defendant, Appellee, v. OLYMPIA MORTGAGE COMPANY, Defendant-Counter-Claimant-Cross-Defendant, Thomas Messina, DLJ Mortgage Capital LLC, Defendants-Cross-Defendants-Cross-Claimants, Alliance Mortgage Corporation, dba Everyhome Mortgage Company, Wilshire Credit Corporation, Federal National Mortgage Association, XYZ Corporation (Said name being fictitious, it being the intention of Plaintiff to designate any corporation having a legal interest in Plaintiffs’ mortgages), JP Morgan Chase Bank, as Trustee for the Home Equity Trust Series 2003-3 submitted as deft for Wilshire Credit Corporation and XYZ Corporation, Michael B. Cheatham, Credit Suisse First Boston LLC, Credit Suisse First Boston Mortgage Securities, Inc., Benjamin Turner, Defendant-Cross-Defendants, Michael Masciale, Certilman Balin Adler & Hyman, LLP, Defendants, United Property Group, LLC, United Homes, LLC, Galit Network, LLC, Yaron Hershco, Defendants-Cross-Defendants-Cross-Claimants-Appellants.
Nos. 12-2909-cv, 12-2912-cv, 12-3619-cv, 12-3621-cv
United States Court of Appeals, Second Circuit
Jan. 29, 2014
Amended Jan. 30, 2014
Here, Henry claims that the district court erred by instructing the jury on qualified immunity, and by including an interrogatory on the verdict form relating to qualified immunity. But Henry himself asked the court to give the jury a qualified immunity instruction, and specifically approved the qualified immunity instructions that the court gave. By requesting and approving the qualified immunity instruction, Henry invited the errors of which he now complains. He therefore cannot challenge them on appeal. See United States v. Hertular, 562 F.3d 433, 444 (2d Cir. 2009); United States v. Quinones, 511 F.3d 289, 321 (2d Cir. 2007); United States v. Giovanelli, 464 F.3d 346, 351 (2d Cir. 2006).
Moreover, even if Henry had not actively invited the alleged errors, he at least failed to object to those errors at trial, and he cannot show plain error. See Rasanen, 723 F.3d at 332. If the district court did err in this case, the error was not plain, and it did not seriously affect the fairness, integrity, or public reputation of the judicial proceedings. Henry therefore is not entitled to relief.
To the extent that Henry also contends that the verdict was inconsistent, he waived that argument by failing to object to either the jury instructions or the verdict form, and by failing to object to the inconsistent verdict before the jury was excused. Kosmynka v. Polaris Indus., 462 F.3d 74, 83–85 (2d Cir. 2006). Given Henry‘s persistent failure to raise the issue in a timely fashion below, we choose not to exercise our discretion to overlook this waiver. See Lavoie v. Pac. Press & Shear Co., 975 F.2d 48, 55–56 (2d Cir. 1992).
We have considered Henry‘s remaining arguments and find them to be without merit. For the reasons stated herein, the judgment of the district court is AFFIRMED.
Sara Manaugh (Pavita Krishnaswamy, South Brooklyn Legal Services, Brooklyn, NY, Jean Constantine-Davis, AARP Foundation Litigation, Washington, D.C., J. Christopher Jensen, Cowan, Liebowitz & Latman, P.C., New York, NY, on the brief), South Brooklyn Legal Services, Brooklyn, NY, for Appellees.
PRESENT: DENNIS JACOBS, and BARRINGTON D. PARKER, and DENNY CHIN, and Circuit Judges.
SUMMARY ORDER
Defendants Yaron Hershco and his companies, United Homes LLC, United Property Group LLC, and Galit Network LLC (collectively, “United Homes“) appeal from the final judgment of the United States District Court for the Eastern District of New York (Matsumoto, J.) awarding compensatory and punitive damages to six home buyers—Sandra Barkley, Mary Lodge, Dewitt Mathis, Lisa & Miles McDale, Charlene Washington, and Sylvia Gibbons (collectively, the “Buyers“)—who were sold defective and damaged homes represented as “newly renovated” by the Defendants. The Defendants argue that the district court erred in: (1) consolidating the six cases for trial; (2) denying the Defendants’ post-trial motion for judgment as a matter of law (“JMOL“) under
1. “The trial court has broad discretion to determine whether consolidation is appropriate.” Johnson v. Celotex Corp., 899 F.2d 1281, 1284 (2d Cir. 1990) (citations omitted). In making this determination, the court considers “[w]hether the specific risks of prejudice and possible confusion [are] overborne by the risk of inconsistent adjudications of common factual and legal issues, the burden on parties, witnesses, and available judicial resources posed by multiple lawsuits, the length of time required to conclude multiple suits as against a single one, and the relative expense to all concerned of the single-trial, multiple-trial alternatives.” Id. at 1285 (citation omitted) (second alteration in original).
The district court applied Johnson, finding “significant benefits” of consolidation—common questions of law and fact, efficiency, and the avoidance of possibly inconsistent verdicts—and only minimal potential prejudice. There was no abuse of discretion.
2. The district court‘s ruling on a post-verdict motion for JMOL under
Section 12 of each sale contract contained a “specific merger clause” that the property was sold “as is.” However, there was no testimony at trial about the specific merger clause, and United Homes did not raise any argument related to the clause in its
Alleged wrongdoing that merely constitutes a breach of contract cannot constitute fraud. See Van Neil v. Berger, 219 A.D.2d 811, 632 N.Y.S.2d 48, 48 (4th Dep‘t 1995) (“A cause of action for fraud is not stated where the only fraud alleged relates to a breach of contract“). However, where a party makes misrepresentations to induce the other party to enter a contract, the fraud claim is sustained. See Deerfield Comm‘ns Corp. v. Chesebrough-Ponds, 68 N.Y.2d 954, 956, 510 N.Y.S.2d 88, 502 N.E.2d 1003 (1986). At trial, the Buyers presented evidence that, to convince the Buyers to purchase, United Homes promised “fully renovated” homes and repeatedly assured that all necessary repairs would be completed before closing. Yet, at the same time, United Homes concealed rotten flooring, leaking roofs, debris, electrical and plumbing problems, and water damage. A jury could reasonably find that this constituted fraud.
In New York, a valuation of property provided by the seller generally will not support a fraud action because “the purchaser must rely on his own judgment as to value.” Seis v. Plaisantin, 52 A.D. 206, 65 N.Y.S. 70 (1900). However, an inflated appraisal may support a fraud claim if the buyer is tricked by the seller and the buyer is not versed in home values. Merry Realty Co. v. Martin, 103 Misc. 9, 169 N.Y.S. 696, 698 (Sup. Ct. Kings Cty. 1918), aff‘d sub nom. Merry Realty Co. v. Shamokin & Hollis Real Estate Co., 186 A.D. 538, 174 N.Y.S. 627 (2d Dep‘t 1919), rev‘d on other grounds, 230 N.Y. 316, 130 N.E. 306 (1921) (holding that a “representation as to value becomes an allegation of fact and not merely an expression of opinion” where the buyer “is induced by the seller to forbear making inquiry, and damage results“). Here, a jury could find that concealment of the true property conditions and the steering of inexperienced Buyers to United Homes’ appraisers prevented the Buyers from discovering or seeking to determine the actual value of the properties.
3. “Punitive damages are warranted where the conduct of the party being held liable evidences a high degree of moral culpability, or where the conduct is so flagrant as to transcend mere carelessness, or where the conduct constitutes willful or wanton negligence or recklessness.” Buckholz v. Maple Garden Apts., LLC, 38 A.D.3d 584, 832 N.Y.S.2d 255 (2d Dep‘t 2007). Reviewing the record de novo, we see nothing to upset the jury‘s finding that the conduct of United Homes—perpetuation of a scheme that lured inexperienced, low-income individuals into purchasing damaged homes that they could not afford—was “so flagrant as to transcend mere carelessness.”1
We review a district court‘s award of attorney‘s fees for abuse of discretion. McDaniel v. Cnty. of Schenectady, 595 F.3d 411, 416 (2d Cir. 2010). An abuse of discretion could consist of an erroneous view of the law or a decision that, while not necessarily the product of a legal error or a clearly erroneous factual finding, cannot be located within the range of permissible decisions. See Zervos v. Verizon New York, Inc., 252 F.3d 163, 169 (2d Cir. 2001). United Homes argues that the fee award of over $2 million (more than twice the amount of the recovery) is outside the range of permissible decisions, and that the award was excessive because the Buyers (who did not prevail on their discrimination claims) enjoyed only limited success at trial.
An attorney‘s fee award should take into account a plaintiff‘s partial success. Hensley v. Eckerhart, 461 U.S. 424, 436, 103 S.Ct. 1933, 76 L.Ed.2d 40 (1983) (“If ... a plaintiff has achieved only partial or limited success, the product of hours reasonably expended on the litigation as a whole times a reasonable hourly rate may be an excessive amount.“). The district court applied Hensley, and excluded from the fee award calculation all hours billed exclusively to the unsuccessful discrimination claims. The district court also noted that the $1.1 million judgment provided “substantial relief” to the plaintiffs, and represented a “substantial degree of success at trial.” There was no abuse of discretion.
Nor was the size of the fee award unreasonable when compared to the recovery. While “New York courts have stated that, as a general rule, they will rarely find reasonable an award to a plaintiff that exceeds the amount involved in the litigation,” F.H. Krear & Co. v. Nineteen Named Trustees, 810 F.2d 1250, 1264 (2d Cir. 1987), attorney‘s fees awarded under
4. New York law allows for “piercing the corporate veil” when the corporation is so dominated by an individual that it primarily conducts the individual‘s business rather than its own, and through this domination, a wrong is committed against a third party. See, e.g., Wm. Passalacqua Builders, Inc. v. Resnick Developers S., Inc., 933 F.2d 131, 138 (2d Cir. 1991) (“Liability therefore may be predicated ... upon complete control by the dominating corporation that leads to a wrong against third parties.“). Hershco moved for JMOL post-verdict, challenging the sufficiency of the evidence of both domination and the commission of a wrong through that domination. We review the district court‘s denial of this motion de novo. Runner v. N.Y. Stock Exch., Inc., 568 F.3d 383, 386 (2d Cir. 2009).
Hershco‘s argument that he did not “dominate” the United Homes entities was not properly preserved and is therefore waived. A post-verdict motion for JMOL under
Regarding the second prong, Hershco argues that there was no evidence
For the foregoing reasons, and finding no merit in United Homes’ and Hershco‘s other arguments, we hereby AFFIRM the judgment of the district court.
* The Clerk of the Court is directed to amend the caption as set forth above.