Requires a court to award reasonable attorneys' fees and costs incurred for meritless actions and abusive lawsuits when it has granted a motion to dismiss for failure to state a cause of action.
NEW YORK STATE ASSEMBLY MEMORANDUM IN SUPPORT OF LEGISLATION submitted in accordance with Assembly Rule III, Sec 1(f)
BILL NUMBER: A5516
SPONSOR: Sepulveda TITLE OF BILL: An act to amend the civil practice law and rules, in
relation to attorneys' fees and costs for meritless actions and abusive
lawsuits
PURPOSE OR GENERAL IDEA OF BILL:
Relates to attorney's fees and cost for meritless actions and abusive
lawsuits
SUMMARY OF PROVISIONS:
Section 1. Courts grant a motion to dismiss for failure to state a cause
of action upon which relief may be granted, the court shall award the
party or parties against whom the dismissed claims were asserted reason-
able attorneys' fees and costs incurred in the proceeding as a conse-
quence of the dismissed claims.
Section 2.The court shall not require a party to pay attorneys' fees and
cost under this section in excess of fifteen thousand dollars in any
single lawsuit
Section 3a.Does not apply to actions by the state, other government
entities, or public officials acting in their official capacity or under
color of law;
b. any claim that is dismissed by the granting of a motion to dismiss
that was filed more than sixty days after the moving party received
service of the latest complaint, counter-complaint or cross-complaint in
which that dismissed claim was made;
c. Any claim that the party against whom the motion to dismiss was
granted in good faith amended to state a claim upon relief may be grant-
ed;
d. actions by pro se litigants, except where the court also finds that
the pro se party acted unreasonably in bringing, or refusing to volun-
tarily withdraw, the dismissed claim
e. any claim which is a good faith, non-frivolous claim for the express
purpose of extending, modifying, or reversing existing precedent, law or
regulation, or for the express purpose of establishing the meaning,
lawfulness or constitutionality of a law, regulation or constitutional
right where the issue is a matter of first impression or subject to
conflicting interpretations.
Section 5a. if in an action to recover damages for personal injury,
injury to property or wrongful death, or an action brought by the indi-
vidual who committed a crime against the victim of the crime, and such
action or claim is commenced or continued by a plaintiff or a counter-
claim, defense or cross claim is commenced or continued by a defendant
and is found, at any time during the proceedings or upon judgement, to
be frivolous by the court, the court shall award to the successful each
prevailing party costs and reasonable attorney's fees not exceeding
25,000 for each frivolous claim, defense or cross claim.
DIFFERENCE BETWEEN ORIGINAL AND AMENDED VERSION:
N/A
JUSTIFICATION:
At this moment, it is extremely difficult to get a baseless lawsuit
dismissed in New York. In 2014, singer Collette McLafferty was served
with a lawsuit by a personal injury attorney representing himself. The
lawsuit sought $10 million in damages. This attorney was the former
drummer of a Pink cover band with which Ms. McLafferty had performed a
single concert. She had never actually met him, but in his filing the
lawyer accused Collette of hurting his image - apparently by being "too
unattractive" and "a lousy singer." The lawsuit was filed in bad faith
with the intended goal of harassing and bullying Ms. McLafferty. She
spent nearly $15,000 in legal fees defending herself, a sum that forced
her to give up her apartment of 10 years and move out of Manhattan. Most
troubling, when all was said and done, the attorney faced no sanctions
or reprimand from the court. After two years of litigation, the case was
eventually settled and dismissed, but she was never fully reimbursed for
the damage done. Collette's struggle was picked up by the media with
tabloid headlines focused on the insulting language found in the court
papers.
Lawsuits like this are a drag on our legal system and serve only to
harass and extort a settlement from the defendant. The bill proposed
here authorizes the imposition of monetary sanctions in any civil action
or proceeding upon a written finding of the court that a party or attor-
ney has brought a claim or employed procedures entirely without merit
and in bad faith. The legislation aims to reimburse victims of lawsuit
abuse as well as deter parties and attorneys from filing meritless
claims.
PRIOR LEGISLATION HISTORY:
New Bill
FISCAL IMPLICATIONS:
N/A
EFFECTIVE DATE:
This act shall take effect immediately.
