Landmarks Holding Corporation v. David W. Bermant
664 F.2d 891
2d Cir.
1981
Check Treatment

*2 Evergreen on the center Avenue site. The LUMBARD, Before MANSFIELD and required plaintiffs contract to obtain the GRAAFEILAND, Judges. VAN Circuit necessary zoning changes provided party agreement either could terminate the LUMBARD, Judge: Circuit zoning should reclassification not be Plaintiffs, partners real in a estate devel- forthcoming. (cid:127) opment, order appeal from an entered in Upon learning plans, January District of on Connecticut owners of Hamden Mart1 and Hamden Pla- 1981, granting summary judgment to the (the defendants”) za “Plaza op- decided to defendants an antitrust suit. The com- pose the development. Bermant, David plaint defendants, alleged that consist- Plaza, co-owner of Hamden conceded in a ing centers, existing shopping of two indi- deposition taken on March 1973: managers part viduals and/or subject We found out that this center centers, nearby owners of those and certain rezoning Town, plus to the ex- residents, property owners and had con- huge penditures of sums for new roads to spired prevent plaintiffs open- mall, serve the also the Town.... it ing a competing shopping by organ- center oppose was decided to effort this with izing protracted opposition before state ad- every means, delay to either defeat or agencies, by litigating ministrative in the many years possible, as proposed faith, state by soliciting courts bad center. subsidizing bring others to baseless liti- gation Eginton the state courts. planned litigate regard- The defendants alleged held that defendants’ actions were merits, less of the anticipating that even if protected activity and dismissed the com- development lost “could plaint. disagree We we reverse. property of this a minimum of three to five

years...” delay, hoped, This defendants May Department I. induce would Stores plans encourage Co. to abandon its As this case is us on before prospective sign tenants leases in Ham- summary judgment, we must take true den or Hamden Mart rather than alleged complaint facts and as wait for the new center to be built. shown in affidavits the discovery rec- ord. approximately Hamden is a town proposed Construction of the mall re- 50,000 people quired situated in Connecticut separate to seek three countryside six miles rulings by Planning north New Haven. the Hamden and Zon- 1960’s, malls, First, In the shopping (“HPZC”). two Hamden Commission longer 1. Hamden Mart has and is settled in this defendant action. regula- zoning adopt adoption classification apply HPZC to the

had creating zoning regulations.3 classification tions Hamden Prior shopping centers. HPZC, Despite their initial success Second, the such classification.2 had no attempt first plaintiffs failed in their adopt the HPZC to have plaintiffs needed change Evergreen a zone secure highways layout plans for access street Property. July Avenue the HPZC *3 Third, leading to the mall. the application appear- their after the denied change particular zoning a needed landowners, opposition numerous ance in of manufacturing to from classification parcel including party those made defendants regional shopping classi- newly the created appeared The Plaza here. defendants fication. among things, argued, other that the HPZC appeared personal- Plaza defendants The reject application the should the because changes oppose the the ly before HPZC to compete mall would with the Mart and new appealed sought by plaintiffs. They the the Plaza. At heart of much of the local of HPZC to each adverse decision the opposition plaintiffs’ application to was the they knowing the Court of Common Pleas — publicity campaign secretly massive or- a to standing so—and from there lacked to do by the ganized and funded Plaza defend- They Supreme Court. se- ants. campaign cretly publicity funded massive ap- Plaintiffs succeeded with their second oppose citizenry the of Hamden to to arouse zoning change, plication for which the “quality development as a threat to the the granted The HPZC on June de- Finally, they and subsi- of life.” solicited appealed then fendants this HPZC opposition by residents of Hamden dized ruling all the deci- had from other (the defendants”) before the “landowner of the the sions HPZC. October of Pleas, of the Court Common HPZC by the appeals Plaza defendants and the although they many of had knew the claims adoption from the landowners of the re- merit. classification, shopping zoning gional the spring response to In the of plans, layout granting and the of the street petition, adopted regu- the HPZC change Evergreen zone on the Avenue regional shopping center creating lations hearing Property were all consolidated for zoning approved classification of Pleas. in the Court Common layout sought by plaintiffs. plans street Many appeals of the taken land- by the Plaza, rulings, From the HPZC Hamden were solicited and financed owners Mart, of Hamden and two the landowner lawyers, Plaza defendants. Three who had defendants, George Melinda Daniels and already by the been retained Plaza defend- (the “Neals”), took a of five Neal total ants, represent resi- offered landowner It appeals to of Common Pleas. the Court litigation against proposed law dents was well settled under Connecticut mall, charge. These never lawyers free of Plaza defendants lacked then to their landowner-resident clients standing any appeals of disclosed take standing representation appeal from their simultaneous of the Neals lacked regulations. Planning gation Board, Hence, The record not how Hamden Sheridan v. does disclose came Mart and Hamden Piaza absence cation. to be built A.2d regional shopping zoning of a classifi- neither Plaza defendants nor the adoption standing appeal from the Neals had regulations. of these shop- regulations creating regional 3. The standing ap- The Plaza defendants lacked “floating ping zoning center were classification layout peal adoption from the street effect until in zon- zones” had no utilized plans mortgagees not or because were record owners particular parcel A 1969 Con- of land. plans. in those See land located decision held that necticut Court own The Neals did Conn.Gen.Stat. 8-30. § validity “floating chal- zones” could be such property. such zoning lenged appeal of a in an from the land, promul- parcel particular not from defendants, paying trying most of to show that we are were not litigation, ensuing legal proceedings.” inscription fees. This was initialed lawyers Bermant, the Plaza defendants subsidized by David defendant and co-owner litigation expenses for the landowners Mart, showing of Plaza that he it. read knowledge or consent of those appeals the Supreme While landowners. pending, submitted Pleas, Court of Common After trial application zoning change third for a aon 27, 1972, judgment June was entered on portion Evergreen smaller Avenue dismissing appeals by all the the Plaza de- property.7 approved appli- HPZC standing. Likewise, for lack of fendants all again cation on October of the landowner defendants Plaza defendants and landowner defendants (1) exceptions: were dismissed with two A separate appeals took to the Court of Com- portion of Melinda Daniels’s from mon Pleas. The court the appeal dismissed layout adoption plans of the street standing of the Plaza defendants lack *4 hearings referred for further on the com- appeal of and the the landowner defendants taking pensation due her for the of her Supreme on the merits. The Court denied property; (2) upheld the court the 3, 1973, certification on October and the approved claim the had not HPZC the change plaintiffs’ property zone of to re- change majority, required zone % gional However, shopping became final. petition protest when a valid is filed.4 validity the the layout plans of road of parties appealed5 All the from each ad- regulations creating shop- the the regional Supreme verse the decision and Connecticut ping zoning classification remained uncer- granted again, Court certification.6 Once pending tain Supreme disposi- the Court’s the Plaza defendants subsidized the appeals. tion of the first set of Moreover, of the landowner defendants. disposition In an attempt expedite to the deliberately delayed Plaza defendants remaining appeals, plaintiffs the met with appeals. plaintiffs sought When an lawyer the for the possi- Neals to discuss expedited hearing Supreme before the ble settlement. Plaintiffs claimed that the Court, the Plaza defendants wrote to the presence continued of the Neals the Judge asking appeal post- Chief that the be pending appeals was crucial the to poned print- until full record below was tactics, delaying defendants’ since the ed, Neals delay. which entailed considerable Al- standing alone had objections to raise to the though a letter from the Plaza defendants’ notify HPZC’s failure properly them of counsel stated that the defendants also sought proposed layout expedite required new street appeal, copy of the produced quick letter from the statute. A defendants’ files settlement with the it, Neals, handwriting hoped, bore on of defendant would have facili- Starr, words, purely Rudolf summary disposition “This is bull tated remaining of the requires by right appeal 8-3 § Conn.Gen.Stat. a 2h vote for There to the Connecticut zoning changes property Supreme zoning Following where Court cases. de- 20% protest sign (now feet owners within 500 of the site cision Superior the Court of Common Pleas petition. Here, Court) pro- losing party may petition the defendants submitted a 1,200 petition it, Supreme test with on names but refused Court for certifica- identify signato- justices certification, grant to the HPZC which tion. If two vote to Supreme appeal. ries lived within 500 foot radius. The will hear Court consequently petition HPZC decided the §§ was Gen.Stat.Ann. 8-9. Certification is a Pleas, invalid. Court Common matter “sound be discretion and will proof special defendants offered the first time allowed portant where are there and im- required signed number landowners had reasons therefor.” Conn.Practice petition, upheld petition. Book, Rules, Supreme and the court § Court 761C. only party pur- application change 5. Hamden Mart was not 7. The third was a zone appeal Supreme acres; original application sought sue its to the Connecticut on 82 change Court. for 104 acres. liability, citing the Noerr- single, issue from antitrust only a meritless appeals, since doctrine, Pennington defend- Eastern Railroads the Plaza would have remained: HPZC deci- standing Conference v. Noerr Motor ants’ Presidents Accordingly, 127, 523, the crux of the Freight, since sions. 365 U.S. S.Ct. proposed complaint was that (1961); Neals’ United Mine Workers house, 1585, be too close to 657, mall would Pennington, 381 U.S. S.Ct. moving pay the cost of plaintiffs offered (1965). 14 L.Ed.2d 626 The remote location on the the house to a more claimed that the defendants’ acts fell within However, attorney property. Neals’ litigation” exception to that doc- the “sham Neals, Neals, who, unbeknownst trine, g., e. Motor California de- receiving payments from the Plaza 404 U.S. fendants, the settle- never communicated (1972); 30 L.Ed.2d 642 see Vendo Co. v. ment offer to Neals.8 n.6, Corp., Lektro-Vend n.6, 53 L.Ed.2d 1009 upheld ultimately The district court held that this case was regional shopping center adoption of the governed by Miracle Mile Associates v. layout plans. and the street classification Rochester, (2d 1980) 617 F.2d 18 Cir. Zoning Plan and Com v. Town Schwartz Wilmorite, Estate, Inc., Eagan Inc. v. Real mission, (1975); 357 A.2d 495 168 Conn. (N.D.N.Y.1977), F.Supp. aff’d. Hamden, 168 Conn. v. Town of Schwartz opinion, (2d Cir.), 578 F.2d 1372 (1975).9 The net result of the 357 A.2d 488 denied, cert. brought by the various de- fourteen actions *5 (1978). Placing great L.Ed.2d 655 stress on by plaintiffs 1975 the fendants was that language in Miracle Mile that “access obtaining everything in from had succeeded barring to the sham ex- Every is the cornerstone they needed. claim the HPZC that Eginton granted summary ception,” Judge and their straw of the Plaza defendants failed, peti- judgment, stating that it is “difficult litigants protest save for the tion, by the Court to discern how have was rendered moot which any application for a modi- been denied access to forum.” More- tiffs’ success in over, although zoning change. plaintiffs’ Judge Eginton Yet noted that fied proved Pyrrhic, soliciting for the courtroom victories the Plaza defendants’ conduct them protracted delays by subsidizing litigation withholding had then forced development. “arguably to abandon the a violation settlement offers was Ethics,” such conduct was of the Canons of brought this suit in 1971 to Plaintiffs by immunized the Noerr-Pen- nevertheless later amended their recoup their losses and nington doctrine. again in 1979 to complaint in 1977 and protracted liti- the obstructive and include

gation by op- the defendants in conducted II. plans.

position appeal is wheth The central issue on conduct, alleged in the com er Plaza’s finally summa- The defendants moved for through discovery, 1980, plaint is claiming and revealed ry judgment in June that by the First Amendment their activities immunized First Amendment shielded Neals, 1974, 1976, Douglas Supreme lawyer In Court af for the $25,000 Daniels, pro- George of Common firmed the decision of Court sued Neal for petition litigation upholding protest and strik services rendered Pleas ing fessional zoning change zoning changes. George against for failure to Neal down the 1971 However, alleging majority requirement. malpractice, satisfy the 2/s counterclaimed Neal, (1) validity represented Daniels: had no effect on the while Daniels this decision shopping appeared litigation oppose approval zon in 1972 of the modified HPZC’s ing change, mall, knowledge; (2) approval failed to without Neal’s which was affirmed plaintiffs, convey a settlement offer from in 1973. became final (3) Daniels disclose Neal that failed to payments in simi- from the Plaza had received litigation. pending lar 896 Noerr-Penning- Doctrine, liability (1977). under the ton

antitrust U.Chi.L.Rev. 80 doctrine, short, judi- ton Eastern Railroad Presidents abuse of administrative and Freight, process through Conference v. Noerr Motor lawyer cial unethical con- 127, 523, 5 81 S.Ct. L.Ed.2d 464 filing U.S. repetitive duct and of insubstantial (1961); Penning- United Mine Workers unprotected by claims is the Noerr-Pen- ton, L.Ed.2d nington immunity. (1965), it or whether falls within Here, alleged, the activities if credit exception” to “sham that doctrine as carved ed, show that the Plaza defendants con by Supreme out Court California spired prevent erect Co. v. Motor competing shopping center. In fur U.S. L.Ed.2d conspiracy, therance of this the Plaza de (1972), and in Tail Power Co. Unit- Otter appealed fendants to the Court of Common States, ed 93 S.Ct. U.S. Supreme Pleas and Connecticut Court from (1973), remand, affirmed after HPZC, knowing each decision 2594, 41 L.Ed.2d 207 standing lacked to do so. These de hopes fendants had reasonable win Pennington, supra, In Noerr and ning appeals, securing delay. attempts Court held that to influ dismissed, such Each as were legislative process, though ence even most the landowner solicited and by motivated to reduce or desire eliminate by financed the Plaza Fur defendants. competition, protected by the First thermore, the Plaza deliberately defendants time, however, Amendment. At same protracted proceedings misrepresent qualified immunity pro this ing to the Chief Justice of the Connecticut viding attempts that such would be actiona Supreme Court that they needed extra time ble under antitrust laws where are printed; to have the record among them a “mere actually sham to cover what selves, they acknowledged request to be nothing attempt an more than to interfere “purely Finally, repre bull.” attorney an directly with the business relations senting both the Plaza defendants and the Noerr, competitor.” supra, 365 U.S. at Neals failed to communicate a settlement *6 81 at S.Ct. 533. California Motor offer from the to the Neals. Ac supra, expanded this ceptance of by this offer the Neals would exception, stating “sham” that “unethical major have removed rapid obstacle to the setting in adjudicatory conduct the remaining appeals resolution of the before process” pursuit pattern or the of “a of Supreme sum, Court. In baseless, repetitive claims” cannot seek ref by bringing the ap numerous meritless uge Noerr-Pennington under the doctrine peals, by in delay prosecution deliberate the they since process constitute an abuse of appeals, of those by the solicitation and barring “effectively agen ... access to the litigation by subsidization of meritless the cies and 404 courts.” at 92 U.S. landowners, by attorney’s their Accord, failure S.Ct. at 612-613. Otter Tail Power convey Neals, States, a settlement offer to the supra, Co. v. United 410 U.S. at the Plaza defendants successfully 93 (“repetitive carry S.Ct. at stalled 1031 lawsuits plaintiffs’ applications zoning changes for the hallmark of insubstantial claims” Evergreen are on the unprotected); property Avenue for five Vendo Co. v. Lektro- Corp., years. delay n.6, ultimately Vend This 433 U.S. 635 forced the 97 S.Ct. 2881, 2889, n.6, (1977) (“re to abandon 53 L.Ed.2d 1009 their venture. We petitive, litigation may allegations sham hold that an state a constitute cause of violation”) (plurality opinion); antitrust action right see under the antitrust laws. The Bork, generally petition R. The Antitrust Paradox the the courts for redress of (1975); Fischel, 359 grievances Liability protect Antitrust for does not abuse of the Attempts to Influence process Government through Action: the institution and the Noerr-Penning- Bases and Limits of the litigation subsidization of baseless

897 HPZC, resolution, appeals solely the which were taken solely to harass and its final anti-competitive purposes. Nothing in First competitor. hinder the kinds of abuse of licenses Amendment Wilmorite, the defendants were com- the record discloses here. process civil that peting shopping owners institut- center therefore reverse. We prevent sponsored litigation ed and developing cen- shopping tiffs from a new defendants’ re- district court’s and ter. The resemblance to this case ends City Mile Associates v. liance on Miracle there, “pre- as Wilmorite defendants Rochester, (2d 1980), F.2d 18 Cir. court, partially vailed in the trial Estate, Wilmorite, Eagan Inc. v. Real Appellate successful Division.” (N.D.N.Y.1977), F.Supp. 1124 aff’d. F.Supp. Judge at 1135. This led Port (2d Cir.), opinion, 578 F.2d 1372 hardly state: “these are the threads from denied, cert. ‘pattern repetitive which a of baseless (1978), misplaced. L.Ed.2d 655 These claims,’ woven,” (citation can be Id. omit- distinguishable. plainly are cases ted). defendants, Unlike Wilmorite Mile, City In Miracle Rochester every appeal Plaza defendants lost opposed plaintiffs’ plans shopping to build a took and all but one of the through proceedings instituted be- center Furthermore, they sponsored. they en- various and federal environmen- fore state gaged misrepresentations to in the court agencies. subsequently Miracle Mile tal appeals, of their conduct evidenced Act, brought an under the action Sherman by “purely inscription bull” the let- on City charging opposed shop- ter the Chief of the Connecticut ping center in bad faith and with intent Court, Supreme failed to commu- suppress competition with commercial nicate a settlement offer to Neals. No property City. affirming owned improper such activities in Wil- occurred grant summary judgment morite. defendant, municipal the court found that City “legitimate municipal had a inter- Nor can Plaza defendants derive City any preserving est in from the adverse comfort from the Court’s Button, impact opinions created economic suburban N.A.A.C.P. (1963), distinguished or In project,” “sham L.Ed.2d Primus, exception” “where re cases motiva- U.S. lawyers’ adjudicatory processes per Their

tion resort join competi- was the restraint or elimination of son solicitation the landowners to litigation against shopping at 21. mall and tion.” F.2d The State Environ- Act, Quality financing mental Review which the of that secret control proceedings, litigation expression invoked in state in- were not “modes of *7 protect protected by the municipali- tended to the interest of and First and association .,” Button, preventing in . . su ties such Rochester overde- Fourteenth Amendments 335, City pra, velopment. That the had a at 83 S.Ct. at reasonable 371 U.S. First, invoking basis for the Act was both conced- two Primus and Button are reasons. by by ed and concerned with the solicitation and fi evidenced Here, City’s nancing good Wetlands claims. success State Pro- faith ceedings. Having reasonably alleged to have solicit invoked ad- defendants are judicial proceedings by ed the landown ministrative and numerous baseless suits intended, Second, purpose does not for which ers. First Amendment Here, City liability. improper practices in the solici incurred shield such contrast, representation of as oc the defendants had no reasonable tation and clients Primus, supra, 436 appeals basis for their from the decision of curred here.10 See U.S. brought merely litigation cause to be to harass Connecticut Code of Professional Re- another,” sponsibility lawyers injure adjures advising Ethical or Consideration 2-3; (“EC”) generally prohibits lawyers layman “if motivated desire .. . sue 898 1908; 439, 98 at 1901 the Connecticut has

at 426 and S.Ct. and seen fit Association, v. Bar grant cf. Ohralik Ohio State hardly certification can be describ- 449, 1912, 1915, 447, 98 56 Cullum, U.S. ed as “sham”. See State v. (1978) (holding a 728, L.Ed.2d 444 state “consti- (1961); A.2d Conn.Prac- may lawyer tutionally discipline for solic- surely tice Book 761C. This § would seem . . iting person in . under circum- clients where, case, true as in to be the instant likely pose dangers stances that the state page opinion, v. twelve Schwartz Town of right prevent”). has a Hamden, 8, (1975), 168 Conn. 357 A.2d 488 page opinion, seven and a Schwartz v. Town regard, this we note it is Hamden, 168 Conn. 357 A.2d 496 relevant what show (1975), granting follow the of review. paid fees the Plaza defendants law yers for the con landowner defendants in alleged improper I do not believe that the nection with the from the HPZC. rose, attorneys conduct defendants’ or nothing privileged There confidential perhaps word, “fell” is a better to the level payments, of such about the fact or amount “illegal reprehensible” practices of such States, see Colton United 306 F.2d fraud, perjury, bribery, so as to (2d 1962), 637-38 Cir. and such evidence corrupt illegal judicial and make the entire should be admitted.11 process in engaged. which defendants were

Reversed remanded. See California Motor Co. v. Unlimited, Trucking supra, 404 U.S. at 512- GRAAFEILAND, dissenting: VAN 13, 92 S.Ct. at appears, 612-13. So far as Because, Eginton, proceedings like administrative I am unable in Connecticut were fairly to distinguish the instant case conducted. prior Wilmorite, day Plaintiffs had their holdings pre- court’s Inc. v. court and Inc., Eagan Estate, real F.Supp. complaint, Real 1124 vailed. Plaintiffs’ one that mem., (N.D.N.Y.1977), 1372 is voiced all too today, aff’d F.2d often is that (2d Cir.), denied, many cert. had too days 99 S.Ct. court. Relief from (1978), 58 L.Ed.2d 655 Mile sought Miracle inordinate should have been Rochester, Associates F.2d tribunals to which (2d 1980), I respectfully Cir. ready dissent. tiffs had plight access. While their sympathy, merits it does not merit invoca- guarantees The First Amendment access of the tion Sherman Act. regardless to our nation’s courts plaintiff’s anti-competitive motivation. I would affirm. plaintiff’s corrupts Unless the conduct judicial processes, California Motor Trans

port Co. v.

508, 513,

(1972), deprives competitor meaning- or tribunals,

ful to adjudicatory access id. at at not he is in violation of Wilmorite, Eagan Sherman Act. Inc. v. Estate,

Real supra, F.Supp. at litigation

Sham may perhaps corrupt *8 However, process. a case which accepting action, phase volunteer advice to sue also In an earlier of this matter, employment 4; pro- postponed in that EC Newman decision on the 2— multiple representation request discovery hibits with clients of the landowners’ law- interests, differing yers paid or EC full them fees disclosure, defendants, pending EC 5-16. motion decision of the summary judgment.