A federal judge in the Southern District of New York was apparently misled by defense counsel when he issued an order leveling more than $700,000 in sanctions against a Bronx landlord who claimed a T-Mobile rooftop antenna damaged his building, a federal appeals court ruled.
A unanimous panel of the U.S. Court of Appeals for the Second Circuit also said Southern District Judge Alvin Hellerstein’s April 2016 order—in which the court said plaintiff Robert Spring committed an “elaborate and persuasive fraud on the court” and had to pay litigation costs for T-Mobile and co-defendant Skyline Steel Fabricators and Erectors—was in “serious tension” with a recent U.S. Supreme Court ruling limiting sanctions for bad-faith conduct.
Western District Judge Lawrence Vilardo, sitting on the panel by designation, said in the court’s opinion that Hellerstein had been apparently misled by the declaration of T-Mobile’s trial counsel, Marc Rapaport of the Rapaport Law Firm, which had accused Spring of embellishing details for a report on work to be done on his building.
“The story the sanctions motion told—one of suppressed documents uncovered late in the litigation that blew a hole in the plaintiff’s damage claim—appears to have been based on little more than speculation and cherry-picked deposition testimony,” Vilardo wrote.
He also said Hellerstein’s order in Virginia Properties v. T-Mobile Northeast, 13-cv-3493, was in conflict with the Supreme Court’s ruling earlier this year in Goodyear Tire & Rubber v. Haeger, No. 15-1406, that limited sanctions orders to the fees that the innocent party incurred solely because of the bad-faith conduct.
Judges Guido Calabresi and Rosemary Pooler joined in the decision.
“We are disappointed with the ruling of the Court of Appeal, and disagree with it,” Rapaport said in an email. “We believe that the original ruling in the District Court was correct and well-supported by compelling evidence.”
Roberta Kaplan appeared for T-Mobile in the appeal. Virginia Properties was represented by Kenneth Lee, Seth Levine and Christos Papapetrou of Levine Lee.