Southern District of New York Daniel Patrick Moynihan U.S. Courthouse at 500 Pearl Street Southern District of New York Daniel Patrick Moynihan U.S. Courthouse at 500 Pearl Street. Photo: Rick Kopstein

A Manhattan federal judge said Thursday that she’s still considering sanctions against a bagel shop worker who lied on the stand and his attorneys, who have now stepped aside in his employment lawsuit.

U.S. District Judge Katherine Polk Failla of the Southern District of New York said Thursday she would appoint a pro bono lawyer to represent the man, Domingo Castillo Marcelino, after the withdrawal of his attorneys at Michael Faillace & Associates, a New York employment law boutique.

Failla found last year that Castillo Marcelino was underpaid and could be entitled to $8,000 in damages. But she has considered sanctioning him and his ex-lawyers after concluding that his testimony was mostly false.

Castillo Marcelino, a cook and laborer who sued the owners of a Canal Street deli in 2016 for unpaid wages and overtime, vastly overstated the length of time he worked at the deli and lied about key details of his employment, the judge found last year. At times, she wrote, he seemed to be “making up answers as he went along,” trying to fit his responses to the evidence.

His adversaries at 374 Food Inc., represented by Brian Lehman of Lehman Law Group, sought to have the Faillace team disqualified, arguing Castillo Marcelino could blame his lawyers for his perjury. The judge rejected that request last month, but the Faillace lawyers, who are represented by legal ethics lawyer Michael Ross, withdrew this week, leading to the judge’s decision Thursday to appoint a volunteer lawyer to take on Castillo Marcelino’s case.

“The court has concluded that plaintiff perjured himself at trial, and is seriously considering the imposition of sanctions against plaintiff and/or his trial counsel,” the judge wrote in this week’s ruling. “The court believes strongly that plaintiff should be represented in the remaining stages of this case.

“The court has made very serious factual findings and plaintiff is now exposed to very serious consequences, including significant financial penalties,” she continued.

In his lawsuit, Castillo Marcelino claimed he worked more than 12 hours a day, six days a week at the deli, known as Tribeca Bagels, for about eight months in 2015 and 2016. He said he was paid just $100 in cash every day, and sought the overtime and other damages he said he was entitled to under the Fair Labor Standards Act and New York state labor law.

The case ultimately went to trial in 2017. The deli’s owners put up several witnesses who said Castillo Marcelino only worked for about four weeks, when another worker was out with an injury. They said he overstated the involvement of the business’ owner and even got the nickname of another defendant completely wrong.

Failla said in the 2018 ruling that she found most of what the plaintiff said to be false, and said his demeanor concerned her. He “rarely, if ever, looked up in responding to questions” and spent most of the time folding and unfolding his declaration, she wrote. While she found that the FLSA didn’t apply, the deli’s managers did violate state labor law. She called for the parties to file briefs on the prospect of sanctions before she issued a judgment, however.

Asked about the Faillace firm’s withdrawal, its lawyer, Ross, told ALM that “after reviewing all of the facts, Mr. Faillace concluded that it would be best for Mr. Marcelino to have independent counsel so that his interests could be protected and his name cleared.”

Lehman, who represented the deli and its putative owners, praised the judge’s decision to appoint a volunteer lawyer and said it underscored the seriousness of the situation.

“My clients hope to receive a remedy for the harm caused by plaintiff’s perjury, but it shouldn’t be done hastily or without due process,” he said in an email. “From my perspective, Judge Failla has taken this matter very seriously, and I believe this was the right decision.”

The judge said the case would be stayed until a volunteer lawyer for Castillo Marcelino could be found, which she said could take a while.

Castillo Marcelino could not be located for comment.