Petition for Writ of Certiorari — Bartel Dental Book Co. v. Schultz

Supreme Court, U.S.

—_ 255 8:

MAY 10 1985

tip GLERK

F. SPANIOL, UR.

October Term, 1985

BARTEL DENTAL BOOK CO. INC. and MAPLETON HOUSE

BOOKS, INC.,

Petitioners,

vs.

PETER J. SCHULTZ, DORMITORY AUTHORITY OF THE

STATE OF NEW YORK and EDWARD A. PICHLER,

SHERIFF OF THE CITY OF NEW YORK,

Respondents.

PETITION FOR WRIT OF CERTIORARI TO THE UNITED

STATES COURT OF APPEALS FOR THE SECOND CIRCUIT

RUDICK AND RIKON, P.C.

Attorneys for Petitioners

150 Broadway

New York, New York 10038

(212) 732-4277

MICHAEL RIKON

Of Counsel

3973

tz *NJ (201) 257-6850eNY (212) 840-9494¢PA (215) 563-5587

MA (617) 542-1114*DC (202) 783-7288¢USA (300) 5 APPEAL _

QUESTIONS PRESENTED FOR REVIEW

1. Whether it was proper to impose sanctions under Federal

Rule of Civil Procedure Rule 11 when part of a complaint has

been held not to be frivolous and the filing of the complaint obtains

a beneficial result.

2. Whether the courts below erred in holding that petitioners

were not entitled to due process to determine the proper relocation

costs after property was taken by eminent domain.

3. Whether the courts below erred in dismissing an equal

protection claim on a pre-answer motion on the basis that there

was a failure to establish facts.

il

TABLE OF CONTENTS

Page

Question Presented for Review ..............c.ceceee, i

Table of Comtemts ..... cncscvcserceieseee ans bees il

Table of Citations... ... 66606: SO ed ee ee ill

Opinions Below . ....:.0ccse00se00sse5upene eee 2

Statement of Jurisdiction........... ocevsee tudes sbaeas 2

Constitutional Provisions and Statutes Involved......... 2

Seosement of the Case .....0.0s00cck0e eee ee ene eens 2

A. The Procesliaas .....,:.<:sss0se eee 2

BS. The POS 6 ccccccess 1649s ee ee 3

Reasons for Granting the Writ:

I. Awarding Rule 11 sanctions is punitive and is in

confilet with 3 MUNDOER. ou. cdc ccc ccanekeeeens 6

II. The Second Circuit’s holding that petitioners were not

entitled to due process is contrary to the well

estab'ished law of this Court and the Constitution. 8

III. The dismissal of an equal protection claim by a pre-

answer motion on the basis that there was a failure

to establish facts was a clear departure from the

accepted and usual course of judicial proceedings. 11

il

Contents

Page

en ee ee eee 13

TABLE OF CITATIONS

Cases Cited:

Allen v. McCurry, 449 U.S. 90 (1980) ................ 12, 13

Armstrong v. Manzo, 380 U.S. 545 (1965) ............. 10

Bell v. Burson, 402 U.S. 535 (1971) ................... 10

Boddie v. Connecticut, 401 U.S. 371 (1971) ............ 10

Blonder-Tongue Laboratories, Inc. v. University of Illinois

Foundation, 402 U.S. 313 (1971).................. 12

Conley v. Gibson, 355 U.S. 41 (1957) ................. 12

Cleveiand Board of Education v. Loudermill, _.U.S.__.,_-

ET . | eee 10

Eastway Construction Corp. v. City of New York, 762 F.

5 AE SUP ERETESUERSEEE ERLE EE TTT 8

Goldberg v. Kelly, 397 U.S. 254 (1970) ............. ——

Haring v. Prosise, 462 U.S. 306 (1983) ................ 12

Harry F. Chaddick Realty Inc. v. Maisel, 762 F. 2d 534 (7th

Ne i ae us 8

iv

Contents

; Page

Hospital Building Co. v. Trustees of Rex Hospital, 425 U.S.

BE Medics Wat ceekek ahs ccc dunneee<’ Crewe s 11

Kaufman v. Eli Lilly & Co., 65 N.Y. 2d 449, 492 N.Y.S. 2d

584, 482 N.E. 2d 63 (Ct. App. 1985) .............. 12

Kremer v. Chemical Construction Corp., 456 U.S. 461 (1982)

POP OE Porte Te rere rr rye Eee ere ee 12

Koch v. Consolidated Edison Company, 62 N.Y. 2d 548, 479

N.Y.S. 2d 163, 468 N.E. 2d 1 (Ct. App. 1984), cert.

denied, 105 S. Ct. 117, 84 L. Ed. 2d 326 .......... 12

Logan v. Zimmerman Brush Co., 455 U.S. 422 (1982)

RKGKE ENG DAMEN MAREN AA OE RARE ER CEO E eee 10

McDonald v. City of West Branch, ___. U.S. ____, 80 L.

tC <n ca tare gach ew ae kw es Gree Cae eee 12

Migra v. Warren City School District Board of Education,

ee Oe ED Sh kw pave ox ab awe ah eyes te a i2

Nelson v. Piedmont Aviation, Inc., 750 F. 2d 1234 (4th Cir.

CNG A NG caeeis aL anak ka eh aeeee ae oe aa ae 8

Schwartz v. Public Administrator, 24 N.Y. 2d 65, 298 N.Y.S.

2d 955, 246 N.E. 2d 725 (Ct. App. 1969) .......... 12

United States v. Diebold, Inc., 369 U.S. 654 (1962) ..... il

United States v. Westinghouse Co., 339 U.S. 261 (1950)

Contents

Page

Vitek v. Jones, 445 U.S. 480 (1980) ................... 10

Statutes Cited:

Re Re | Pee rere er ee re rt Ter 2

ee Gan GE» hich ds.én dnveee danse cokes (weet

SES Se 600 0eso se ncsnnictadanenaeeee 9

New York State General Municipal Law, Section 74-b

(McKinney’s Consolidated Laws of New York, West

Publishing) ......... secre eee e cece eee eneeeeeees 9

United States Constitution Cited:

UE IIR 4 i 0b ib idn nerd RNA keane ee 9

Rules Cited:

Federal Rules of Civil Procedure:

gt) ere Steen eee ence eee eee ee eens Lm oS

Ge MED & hoc + cas snccan ‘ened nalvadistaennewe 2, ll

Rule 12(b)(6) ........ cx cuveeCasue sea kaeen eee 2, 11

SN EE akin 50s KAT RE Te ih S ee EERE SR ee i

Federal Rule of Appellate Procedure 38 ................ ee

vi

Contents

Page

APPENDIX

Appendix A — Opinion of the Court of Appeals for the

Second Circuit Dated March 12, 1986 ............. la

Appendix B — Decision of the United States District Court

for the Eastern District Dated August 27, 1985 ..... 12a

Appendix C—Relevant Constitutional Provisions and Statutes

No.

In The

Supreme Court of the United States

October Term, 1985

BARTEL DENTAL BOOK CO. INC. and MAPLETON HOUSE

BOOKS, INC.,

Petitioners,

vs.

PETER J. SCHULTZ, DORMITORY AUTHORITY OF THE

STATE OF NEW YORK and EDWARD A. PICHLER,

SHERIFF OF THE CITY OF NEW YORK,

Respondents.

PETITION FOR WRIT OF CERTIORARI TO THE UNITED

STATES COURT OF APPEALS FOR THE SECOND CIRCUIT

*The petitioners, Bartel Dental Book Co. Inc. and Mapleton

House Books, Inc., respectfully pray that a writ of certiorari issue

to review the judgment of the United States Court of Appeals

for the Second Circuit entered in this proceeding on March 12,

i986.

ty

OPINIONS BELOW

The decision of the Court of Appeals is reproduced in the

appendix hereto at p. la. The unreported opinion of the District

Court of the Eastern District of New York from which appeal

was taken dated August 27, 1985 is also reproduced in the appendix

hereto at p. 12a.

STATEMENT OF JURISDICTION

This petition for a writ of certiorari has been filed within

60 days of the entry of judgment of the United States Court of

Appeals for the Second Circuit. Jurisdiction to seek the writ of

certiorari is invoked pursuant to 28 U.S.C. § 1254(1).

CONSTITUTIONAL PROVISIONS AND STATUTES

INVOLVED

Relevant constitutional provisions and statutes are quoted

in the appendix annexed to this petition (20a).

STATEMENT OF THE CASE

A. THE PROCEEDINGS

This action was commenced on March 18, 1985 in the District

Court for the Eastern District of New York. The jurisdiction of

that court was premised under 42 U.S.C. § 1983. On May 3, 1985,

prior to answering the complaint, respondents filed a motion

pursuant to Rule 12(b)(1) and (6) of the Federal Rules of Civil

Procedure for an order dismissing the compiaint in its entirety

for lack of jurisdiction over the subject matter and for failure

to state a claim upon which relief can be granted. Respondents

also requested the imposition of sanctions pursuant to Rule 11

of the Federal Rules of Civil Procedure.

At the oral argument of the motion on June 28, 1985, the

District Court (Nickerson, J.) advised that it was treating the

motion to dismiss as a motion for summary judgment pursuant

to Rule 56.

Subsequently, on August 27, 1985, the District Court issued

its Opinion and order dismissing the complaint and imposed

sanctions under Federal Rule of Civil Procedure 11, except for

work fairly attributable to work done in defending all claims except

the first claim which the court considered not to be frivolous.

On March 12, 1986, the Court of Appeals for the Second

Circuit affirmed the decision below and imposed double costs

and sanctions for a frivolous appeal under Federal Rule of

Appellate Procedure 38.

B. THE FACTS

The petitioners are in the business of buying and selling

professional books and journals and occupied buildings located

in the Crown Heights section of Brooklyn, New York.

On August 9, 1983, the Dormitory Authority of the State

of New York, a public benefit corporation, exercised its power

of eminent domain and condemned the property.

On March 21, 1984, the condemnation claims filed by

petitioners were settled. There remained open, however, the issue

of compensation for the expense of the relocation of several

millions of volumes of books and journals stored on the premises.

The parties agreed to negotiate the compensation for the

moving expense at a later date, but, chese negotiations broke down

after the Authority’s Deputy Executive Director Peter J. Schultz

refused to even offer the amount of his appraisal, something

he did not do to others on the site.

The Authority then filed a motion for a ‘‘Writ of Assistance’,

an order directing the Sheriff of the City of New York to remove

Mapleton. The application was opposed and a hearing was

requested on the issue of relocation. Bartel, the other related entity

occupying space in the same building was not served or mentioned.

No hearing was ever held and although Mapleton attempted

to hold off the removal by a number of judicial applications,

it was unable to obtain a hearing. Finally, in September 1984 the

Sheriff of the City of New York removed all the books and placed

them in storage.

The petitioners attempted to recover their books and were

told that if they wanted their property returned they would first

be required to execute general releases of liability to all parties

and pay storage and moving costs. The storage company and

moving company would not even allow petitioners to inspect their

property advising that they were so instructed by the Dormitory

Authority.

After the instant civil rights action was commenced, and

before the return date of the motion to dismiss, the moving

company and warehouse settled with petitioners and delivered the

books to petitioners’ new location.

The District Court was advised that petitioners recovered their

property, had discontinued against the mover and warehouse

company and that petitioners would be amending their complaint.

Nevertheless, the District Court granted the respondents’ motion

holding that the claims, except for the equal protection claim,

were raised or could have been raised in the state court proceedings

and were now precluded by the doctrines of collateral estoppel

and res judicata under Migra v. Warren City School District Board

of Education, 465 U.S. 75 (1984).

The District Court found that the equal protection claim had

merit and considered it to be the only claim which arose above

frivolity (19a).

Nevertheless, the lower court dismissed the equal protection

claim based on a failure to show facts. This was a decision on

a pre-answer motion. No discovery had taken place. Petitioners

had alleged facts which were not contested at this stage, and if

these facts were accepted as true, should have defeated a motion

of dismissal.

The Second Circuit affirmed.

In discussing the equal protection claim, the Second Circuit

held ‘‘[t}here was no evidence, however, that Mapleton was

discriminated against because it was a member of a suspect class

or exercised a protected right’’. The Second Circuit held that

administrative action is presumed regular unless there is some

burden on a protected class or on protected rights (8a).

The Second Circuit held that petitioners’ claim that it was

entitled to a due process hearing was frivolous.

Petitioners herein seek certiorari to review the error of both

federal courts’ failure to deem petitioners’ factual allegations as

true and to apply all reasonable inferences against the motion.

Certiorari is also requested to review the Second Circuit’s holding

that petitioners were not entitled to a due process hearing and

that sanctions were appropriate when part of their complaint rose

above frivolity and the complaint resulted in a beneficial result

to petitioners.

REASONS FOR GRANTING THE WRIT

AWARDING RULE 11 SANCTIONS IS PUNITIVE AND

IS IN CONFLICT WITH ITS PURPOSE.

The imposition of sanctions under Rule 11 is a powerful

deterrent to frivolous litigation and abusive practices of attorneys.

However, it was intended to correct lawyers’ misconduci and not

to change the ‘‘American Rule’’ governing allocations of the costs

of litigation.

The existence of the Rule has a chilling effect on the ability

of litigants to obtain counsel. Civil rights cases have often been

unpopular matters. If the instant Second Circuit holding is allowed

to stand, an unreasonable restraint will exist in that any lawyer

will be reluctant in taking a difficult case unless that attorney

can guarantee successful results.

No federal Court of Appeals had previously upheld Rule 11

sanctions in a pre-answer motion where one of the several federal

claims asserted has been found by the trial court not to be

frivolous. It is submitted that if part of a complaint is non-frivolous

Or meritorious, Rule 11 sanctions are inappropriate. Either a

lawsuit is frivolous or it is not. There should be no uncharted

gray area which presents total danger for the good faith litigator.

Furthermore, no decision has been rendered by any Circuit

Court which awarded sanctions after there has been a beneficial

result obtained by commencing the lawsuit.

The Second Circuit inexplicably failed to comment on how

Rule 11 sanctions could be imposed by the District Court after

~

f

the petitioners obtained a major result which was not obtainable

without this litigation.

The petitioners could not recover their property which was

forceably removed and held unless they paid moving expenses

and gave general releases to all parties. After the lawsuit was

commenced, the petitioners settled and discontinued their action

against two of the original party defendants and recovered their

property. The trial court was informed of the settlement and that

petitioners were going to amend their complaint with respect to

the value of the inventories which were wrongfully withheld.

In affirming the dismissal of the complaint and the award

of sanctions under Rule 11, the Court of Appeals for the Second

Circuit awarded further sanctions for bringing a frivolous appeal

under Rule 38. To impose this additional ‘punishment, stiffles a

litigant’s ability to have a District Court’s decision reviewed. It

requires as a conclusion that a District Court can never err in

dismissing a civil rights suit and awarding sanctions. The appeal

was pursued to review what petitioners’ counsel perceived as clear

error, the granting of a summary judgment motion under Rule

56 because of an asserted failure to show facts supporting an equal

protection claim when there was never an opportunity to establish

facts.

The Circuit Courts have not been uniform in their holdings

of when Rule 11 sanctions are to be applied and it is important

for this Court to set specific guidelines for future litigants. The

Second Circuit’s decision in this matter, if allowed to stand, will

effectively bar the use of the Civil Rights Act, 42 U.S.C. § 1983

to remedy the deprivation of statutory or constitutional rights.

There is also a conflict with the decisions of other federal

Courts of Appeals on whether the Second Circuit’s holding that

ak subjective good faith no longer provides the safe harbor

it once did’’ Eastway Construction Corp. v. City of New York,

762 F.2d 243, 253 (2nd Cir. 1985) is valid.

The Fourth Circuit appears to apply a ‘‘good faith’’ rule

and will not impose Rule 11 sanctions when there is good faith

argument for the extension, modification or reversal of existing

law. Neison y. Piedmont Aviation Inc , 750 F.2d 1234, 1238 (4th

Cir. 1984).

It is submitted that the Seventh Circuit would not impose

sanctions since the complaint was filed in good faith and far from

being frivolous, petitioners’ first count presented some very

difficult problems indeed. See Harry F. Chaddick Realty Inc. v.

Maisel, 762 F.2d 534 (7th Cir. 1985).

Although petitioners do not suggest that their lawsuit

compares in importance to the landmark decisions rendered by

this Court in the civil rights area, they do wish to argue that many

of the attorneys who brought those suits could very well have

had Rule 11 sanctions imposed if the same punitive standards

now being applied by the Second Circuit were applied.

THE SECOND CIRCUIT’S HOLDING THAT

PETITIONERS WERE NOT ENTITLED TO DUE PROCESS

IS CONTRARY TO THE WELL ESTABLISHED LAW OF

THIS COURT AND THE CONSTITUTION.

It is submitted that this petition shouid be granted and the

issues presented herein decided in order to eradicate the confusion

evident in the Second Circuit opinion in holding that petitioners

were not entitled to due process rights of a full evidentiary hearing

to determine the proper method of calculating relocation costs.

The Second Circuit, in the instant matter, held that the Fifth

Amendment to the Constitution does not give rise to a ‘‘just

compensation’’ right for the cost of relocating a business (7a).

In support of this statement, the court relied on United States

v. Westinghouse Co., 339 U.S. 261 (1950). The reliance was

misplaced because the Westinghouse decision is not controlling

for a number of reasons. First, the District Court would be

compelled to apply the law of the State of New York in determining

what is proper just compensation in any condemnation case and

in New York condemnation proceedings (unlike federal

condemnation proceedings) consequential damages are always

allowable. Secondly, even in federal condemnation proceedings,

the Westinghouse decision would no longer apply because Congress

enacted the Real Property Acquisition Policies Act of 1970, 42

U.S.C. § 4601, ef seq., which mandates payment of relocation

expenses.

The Second Circuit was further in error in holding that there

was no New York State right to be paid relocation costs and that

petitioners ‘‘. . . argument that it had a due process right to full

evidentiary hearing to determine the proper method of calculating

relocation costs is thus frivolous.’’ (8a). It is evident now that

this holding was absolute error because there is a New York statute

which mandates payment of moving and relocation expenses. New

York State General Municipal Law, Section 74-b (McKinney’s

Consolidated Laws of New York, West Publishing).

The Second Circuit effectively held that petitioners were not

entitled to due process and by footnote stated:

Even if Mapleton had a due process interest in

obtaining the full measure’ of relocation costs

available to it under New York administrative law,

Mapleton’s interest in that benefit must be

balanced against the state’s interest in efficient

10

condemnation proceedings. Cf. Cleveland Board

of Education v. Loudermill, 53 U.S.L.W. 4306,

4308-09 (U.S. Mar. 19, 1985). Therefore, the only

process actually due to Mapleton was notice and

the opportunity to be heard on the issue. Id. at

4309. The record contains ample proof that

Mapleton had both. [8a].

This holding is directly in contravention of this Court’s

holding in the Loudermill decision which held that the root

requirement of the Due Process Clause is that an individual be

given an opportunity for a hearing before he is deprived of any

significant property interest. In holding that petitioners are not

entitled to due process the Second Circuit decided a federal

question in a way which is in conflict with applicable decisions

of this Court. See Boddie v. Connecticut, 401 U.S. 371 (1971)

and Bell v. Burson, 402 U.S. 535 (1971).

When the court further held that ‘‘even if?’ Mapleton had

a due process interest, the only process due was notice and the

opportunity to be heard, its alternative holding was likewise in

conflict with this Court’s decisions holding that the fundamental

requisite of due process affording the opportunity to be heard

requires that the hearing must be held ‘‘at a meaningful time and

in a meaningful manner.’’ Armstrong v. Manzo, 380 U.S. 545,

552 (1965), cited in Goldberg v. Kelly, 397 U.S. 254, 267 (1970).

It is also in conflict with this Court’s holdings in Logan v.

Zimmerman Brush Co., 455 U.S. 422 (1982) and Vitek v. Jones,

445 U.S. 480 (1980) which requires that there be a meaningful

procedure to obtain the opportunity for a hearing on the merits.

1]

lil.

THE DISMISSAL OF AN EQUAL PROTECTION CLAIM

BY A PRE-ANSWER MOTION ON THE BASIS THAT THERE

WAS A FAILURE TO ESTABLISH FACTS WAS A CLEAR

DEPARTURE FROM THE ACCEPTED AND USUAL

COURSE OF JUDICIAL PROCEEDINGS.

The Second Circuit also affirmed the lower court’s dismissal

of an equal protection claim on the basis that there was no evidence

that Mapleton was discriminated against because it was a member

of a suspect class or exercised a protected right. It held, ‘‘[bJecause

there was no genuine issue as to any material fact, NYDA was

entitled to a judgment as a matter of law. Fed. R. Civ. P. 56¢c).

Therefore, the Court’s grant of summary judgment was proper.”’

(8a). This was a clear departure from the accepted and usual course

of judicial proceedings which requires an exercise of this Court’s

power of supervision.

This matter was on appeal to the Second Circuit after a

motion to dismiss filed pursuant to Fed. R. Civ. P. 12(b)(1) and

(6) was converted by the District Court judge, at oral argument,

to a motion for summary judgment pursuant to Fed. R. Civ. P. 56.

The petitioners did not conduct any discovery at this early

stage of the litigation and were entitled to have the factual

allegations of the complaint accepted as true. Hospital Buildire

Co. v. Trustees of Rex Hospital, 425 U.S. 738 (1976). Any

ambiguity in the pleading was to be resolved against the motion

contrary to the Circuit Court’s holding that ‘‘administrative action

is presumed regular’’, the court was required to draw all reasonable

inferences against the motion. United States'v. Diebold Inc., 369

U.S. 654 (1962). For the Second Circuit to hold that there was

no genuine issue as to any material fact was an abuse of procedural

due process. Dismissal should not have been granted unless it

12

appeared beyond doubt that petitioners could not prove a set of

facts in support of their claim which would entitle them to relief.

Conley v. Gibson. 355 U.S. 41, 45-46 (1957).

The Second Circuit also departed from accepted and usual

course of judicial proceedings by holding this Section 1983 action

barred under Migra v. Warren City School District Board of

Education, 465 U.S. 75 (1984). However, this Court has held that

the concept of collateral estoppel cannot apply when the party

against whom the earlier decision is asserted, did not have a ‘‘full

and fair opportunity’’ to litigate that issue in the earlier case.

Kremer v. Chemical Construction Corp., 456 U.S. 461, 482 (1982);

Allen v. McCurry, 449 U.S. 90, 95 (1980); Blonder-Tongue

Laboratories Inc. v. University of Illinois Foundation, 402 U.S.

313, 328-329 (1971). Under Migra, the federal courts were required

to apply the same preclusive effect that the New York state courts

would apply. New York would not have given a preclusive effect

to the prior state litigation in this matter. Kaufman v. Eli Lilly

& Co., 65 N.Y. 2d 449, 492 N.Y.S. 2d 584, 482 N.E. 2d 63 (Ct.

App. 1985); Koch v. Consolidated Edison Company, 62 N.Y.

2d 548, 479 N.Y.S. 2d 163, 468 N.E. 2d 1 (Ct. App. 1984), cert.

denied, 105 S. Ct. 1177, 84 L. Ed. 2d 325; Schwartz v. Public

Administrator, 24 N.Y. 2d 65, 298 N.Y.S. 2d 955, 246 N.E. 2d

725 (Ct. App. 1969). This Court has uniformly held that a prior

State court judgment would not preclude the federal courts from

acting where the state courts were unable or unwilling to protect

federal rights. Haring v. Prosise, 462 U.S. 306 (1983); Allen v.

McCurry, 449 U.S. 90 (1980). See also, McDonald v. City of West

Branch, ____ U.S. , 80 L. Ed. 2d 302 (1984). indeed, this

is the very purpose for which Congress enacted the Civil Rights

Act.

a

CONCLUSION

For the foregoing reasons, petitioners respectfully pray that

a writ of certiorari should issue to review the judgment of the

Court of Appeals for the Second Circuit.

Respectfully submitted,

MICHAEL RIKON

RUDICK AND RIKON, P.C.

Attorneys for Petitioners

ee ee ee

la

APPENDIX A—OPINION OF THE COURT OF APPEALS

FOR THE SECOND CIRCUIT DATED MARCH 12, 1986

UNITED STATES COURT OF APPEALS

FOR THE SECOND CIRCUIT

++—

No. 579—August Term, 1985

(Argued December 18, 1985 Decided March 12, 1986)

Docket No. 85-7754

aad

BARTEL DENTAL BOOKS CO., INC. and

MAPLETON HOUSE BOOKS, INC.,

Plaintiffs-Appellants,

—_—Vo—

PETER J. SCHULTZ, DORMITORY AUTHORITY OF THE

STATE OF NEW YORK, VALIANT RIGGING & TRANS-

PORTATION, INC., EDWARD A. PICHLER, SHERIFF OF

THE CITY OF NEW YORK and NEW YORK PIGGYBACK

WAREHOUSE, INC.,

Defendants,

PETER J. SCHULTZ, DORMITORY AUTHORITY OF THE

STATE OF NEW YORK and EDWARD A. PICHLER,

SHERIFF OF THE CITY OF NEW YORK,

Defendants-Appellees.

2a

Appendix A

Before:

TIMBERS, MESKILL and PRATT,

Circuit Judges.

+>—

Appeal from grant of summary judgment by the

United States District Court for the Eastern District of

New York, Nickerson, J/., dismissing plaintiff’s 42 U.S.C.

§ 1983 (1982) action and ordering plaintiffs to pay defen-

dants’ attorneys’ fees in defending against all except one

of plaintiffs’ claims.

Affirmed.

——

MICHAEL RIKON, New York City (Rudick

and Rikon, New York City, of counsel),

for Appellants.

DAVID E. NACHMAN, New York City (Martin

Flumenbaum, Paul, Weiss, Rifkind,

Wharton & Garrison, New York City, of

counsel), for Appellees Peter J. Schultz

and Dormitory Authority of the State of

New York.

Frederick A.O. Schwarz, Jr., Corpora-

tion Counsel of the City of New York,

Fay Leoussis, Barry P. Schwartz, Office

of the Corporation Counsel of the City

of New York, New York City, for Munici-

pal Appellee Pichler.

-

3a

Appendix A

MESKILL, Circuit Judge:

This is an appeal from the grant of summary judgment

by the United States District Court for the Eastern Dis-

trict of New York, Nickerson, J., after finding that (1) the

claims of appellant Bartel Dental Books Co. (Bartel!)

under 42 U.S.C. § 1983 (1982) were frivolous because

Bartel had previously released all of its claims against

defendants, and (2) the claims of appellant Mapleton

House Books, Inc. (Mapleton) were barred by the doc-

trines of issue and claim preclusion. The district court

also ordered plaintiffs to reimburse defendants New York

Dormitory Authority (NYDA) and Peter J. Schultz for

the costs and attorneys’ fees they incurred in defending

against all but one of plaintiffs’ claims.

We affirm the judgment of the district court and order

that sanctions for a frivolous appeal be imposed on

appellants and their attorney, Michael Rikon.

BACKGROUND

Bartel and Mapleton were family owned businesses

operating out of the same warehouse. Bartel owned the

warehouse and Mapleton leased it from Bartel. When

NYDA condemned the property, Bartel and Mapleton

filed claims for their respective losses. Later Bartel re-

leased NYDA from all claims and Mapleton gave NYDA

a partial release, expressly reserving any claim it might

have for relocation costs. ,

Although NYDA was not bound by either federal or

state law to pay a business for the cost of moving its

operations, it regularly followed the administrative prac-

tice of the City of New York and made such payments.

4a

Appendix A

Mapleton and NYDA failed to reach an agreement with

regard to relocation expenses.

NYDA moved under section 405 of the New York

Eminent Domain Procedure Law, N.Y.E.D.PL. § 405

(McKinney 1979), for an order directing Mapleton to

vacate the premises. In its moving papers, NYDA alerted

the Supreme Court that Mapleton might attack NYDA’s

method of calculating relocation costs. Mapleton de-

faulted instead and the order to vacate was granted.

Mapleton then confirmed NYDA’s prognostication. In

Mapleton’s appeal of the order to vacate, it claimed that

NYDA’s method of calculating relocation costs violated

its rights to due process. The Appellate Division ulti-

mately dismissed that appeal for lack of prosecution.

Mapleton’s due process claim appeared a second time

in a proceeding under Article 78 of the New York Civili

Practice Law, N.Y. Civ. Prac. Law § 7801 ef seq.

(McKinney 1981). There Mapleton requested a judicial

determination of the proper method for calculating relo-

cation costs and a stay of the order to vacate. The

application for a stay was denied. Mapleton then aban-

doned the Article 78 proceeding.

Mapleton and Bartel next brought a section 1983 action

in federal court alleging that the failure to grant them a

plenary hearing on the amount and manner of calculating

relocation - expenses denied them their rights to due

process and that the failure to treat them in the same

manner as the other claimants denied them equal protec-

tion of the law. Defendants moved to dismiss the action.

The district court treated the motion as one for summary

judgment after giving the parties notice at oral argument

that it intended to do so. Mapleton submitted a memo-

Sa

Appendix A

randum in opposition to the motion to dismiss, again

asserting that it had a constitutional right to a hearing.

The district court found that Bartel had released all

claims against NYDA when it signed a release. The court

therefore concluded that Bartel’s section 1983 claims were

frivolous. As to Mapleton, the court concluded that

because all of its constitutional claims were actually

raised or could have been raised in the state court pro-

ceedings, they were barred under Migra v. Warren Uity

School District Board of Education, 4675 (1984). Thus,

even if those claims were not barred by res judicata, they

failed on the merits because Mapleton had no right to

relocation expenses under either federal or state law and,

therefore, there was “no right to which process [was]

due.” J. App. at 326. Furthermore, the court found that

Mapleton had failed to make a showing that there was a

genuine equal protection issue. It imposed Rule 11 sanc-

tions against Mapleton, Bartel and their attorneys for

bringing a frivolous suit.

Mapleton and Bartel claim on this appeal that the

district court erred in all aspects of its decision. We

disagree. Mapleton and Bartel also claim that the district

judge should have recused himself because one of his law

clerks had applied to become an associate in the law

Offices of defendant Schultz’s counsel. This claim is

frivolous.

DISCUSSION

1. Bartel’s Release

The district court properly found Bartel’s claims to be

frivolous. Contract principles apply to the interpretation

6a

Appendix A

of releases. Bank of America v. Gillaizeau, 766 F.2d 709,

715 (2d Cir. 1985). Bartel argues before this Court that

there is parol evidence to establish that all parties to the

release implicitly agreed that Bartel’s claims for reloca-

tion expenses were reserved. There was no explicit reser-

vation in Bartel’s release; moreover, both the underlying

settlement agreement and the release had valid integration

clauses. Bartel thus seeks to contradict the plain language

of the settlement agreement. That attempt clearly runs

afoul of the parol evidence rule. Katz v. American Tech-

nical Industries, 466 N.Y.S.2d 378, 380 (App. Div. 1983).

2. Claim Preclusion Under Migra

In Migra, the Supreme Court held that federal district

courts hearing section 1983 actions should apply the law

of the forum state when deciding matters of claim preclu-

sion. 465 U.S. at 85. The district court in this case

properly found that all of the claims raised in Mapleton’s

section 1983 action were or could have been litigated both

in the course of Mapleton’s efforts to resist eviction and

in the Article 78 action. It also properly found that New

York courts would bar Mapleton from relitigating its

constitutional claims. See O’Brien v. City of Syracuse,

445 N.Y.S.2d 687, 688 (Ct. App. 1981) (“[O]nce a claim is

brought to a final conclusion, all other claims arising out

of the same transaction . . . are barred, even if based

upon different theories or if seeking a different remedy.”).

Mapleton argues that Migra does not apply when a

hearing has not actually been granted by the state courts.

This argument is without merit for two reasons. First,

Migra emphasized that federal courts should apply the

same preciusive doctrines that a state court would apply.

465 U.S. at 81. New York courts look to whether a claim

Ta

Appendix A

has been “brought to a final conclusion,” not to whether

a full evidentiary hearing has been held on the claim. See

O’Brien, 445 N.Y.S.2d at 688. Second, the Migra Court

reasoned that the legislative policy embodied in 28 U.S.C.

§ 1738, which grants full faith and credit to state court

judgments, was more important than providing a separate

forum for state and federal claims. 465 U.S. at 84. In

light of this reasoning, we apply the doctrine of res

judicata to the facts of this case without regard to

whether a hearing was actually granted in state court.’

Even if Mapleton’s constitutional claims were not barred

by res judicata, they were properly dismissed because they

fail on the merits.

3. Due Process

The Fifth Amendment to the Constitution does not

give rise to a “just compensation” right for the cost of

relocating a business. United States v. Westinghouse Co.,

339 U.S. 261, 264 (1950). Moreover, Mapleton cites no

federal statute that would require NYDA to pay a con-

demnee’s relocation expenses. The New York Constitu-

tion also does not establish a right to be paid relocation

! Mapleton disingenuously claims that when it raised in state court the

issues sought to be litigated here it was in a defensive posture.

Mapleton was not in a defensive posture in the Article 78 proceeding.

Moreover, we have already held that a “defensive posture” argument

does not vitiate Migra. Genova v. Town of Southampton, 776 F.2d

1560, 1561 (2d Cir. 1985) (per curiam).

Mapleton also urges that it did not have a “full and fair opportu-

nity” to litigate the question it raises here. See Kaufman v. Eli Lilly

and Co., 492 N.Y.S.2d 584, 588-89 (Ct. App. 1985); Schwartz v. Public

Administrator, 298 N.Y.S.2d 955, 958-60 (Ct. App. 1969). Mapleton

* questioned the method for determining relocation expenses when it

opposed the motion to dismiss its direct appeal of the order to vacate.

It could have pressed the issue in the Article 78 action, but chose

instead to concentrate on getting a stay of the order to vacate.

Mapleton had a “full and fair opportunity” to litigate the claims

brought here.

8a

Appendix A

costs unless a statute expressly authorizes such payment.

Dormitory Authority v. Security Mutual Insurance, 405

N.Y.S.2d 253 (App. Div. 1983); City of Buffalo v.

Mollenberg-Betz Machine Co., 279 N.Y.S.2d 842, 849-50

(Sup. Ct. 1966). Mapleton concedes as much. Its argu-

ment that it had a due process right to a full evidentiary

hearing to determine the proper method of calculating

relocation costs is thus frivolous.’

4. Equai Protection

The only original claim in this action was that Schultz

violated Mapleton’s equal protection rights under the

Fourteenth Amendment of the Constitution by offering

other condemnees better relocation settlements than were

tendered to Mapleton. There was no evidence, however,

that Mapleton was discriminated against because it was a

member of a suspect class or exercised a protected right.

NYDA and Schultz correctly argue that administrative

action is presumed regular unless there is some burden on

a protected class or on protected rights. Cf. Bishop v.

Wood, 426 U.S. 341, 350 (1976). Thus, no hearing in

federal court is required to determine that the action was

regular. Mapleton’s argument on this point is frivolous.

Because there was no genuine issue as to any material

fact, NYDA was entitled to a judgment as a matter of

law. Fed. R. Civ. P. 56(c). Therefore, the court’s grant of

summary judgment was proper.

2 Even if Mapleton had a due process interest in obtaining the full

measure of relocation costs available to it under New York administra-

tive law, Mapleton’s interest in that benefit must be balanced against

the state’s interest in efficient condemnation proceedings. C/. Cleve-

land Board of Education v. Loudermill, $3 U.S.L.W. 4306, 4308-09

(U.S. Mar. 19, 1985). Therefore, the only process actually due to

Mapleton was notice and the opportunity to be heard on the issue. /d.

at 4309. The record contains ample proof that Mapleton had both.

9a

Appendix A

5. Rule 11 Sanctions

Mapleton’s equal protection claim against Schultz was

the only claim raised for the first time in its federal

action. That claim was not supported by any legally

relevant facts. Mapleton’s other claims had already been

rejected by the New York courts and were clearly without

merit. Furthermore, a competent attorney could not form

a reasonable belief that any of these claims were “war-

ranted by existing law or a good faith argument for

extension, modification, or reversal of existing law.” Fed.

R. Civ. P. 11. See also Eastway Construction Corp. v.

City of New York, 762 F.2d 243, 253-54 (2d Cir. 1985).

The district court clearly did not abuse its discretion

when it ordered Mapleton to pay defendants’ costs and

attorneys’ fees. The district court probably would have

erred if it had not awarded attorneys’ fees to NYDA and

to Schultz under Rule 11 of the Federal Rules of Civil

Procedure. See Eastway, 762 F.2d at 253-54. See also

Harbulak v. County of Suffolk, 654 F.2d 194, 198 (2d

Cir. 1981) (trial court erred when it refused to award

attorneys’ fees to prevailing defendant where plaintiff’s

action under section 1983 was “unreasonable and ground-

less, if not frivolous”).

6. Recusal

Mapleton argues that Judge Nickerson should have

recused himself when he learned that the law firm repre-

senting defendant Schultz was considering one of his law

clerks, Who was not working on the case, for employment

as an associate. Mapleton concedes-that disqualification

has not been required where the clerk is not working on

the case. Reddy v. Jones, 419 F.Supp. 1391 (W.D.N.C.

10a

Appendix A

1976). Mapleton argues, however, that another clerk who

was working on the case “had to be” influenced by the

knowledge that a co-worker was joining Schultz’s law

firm. It also argues that a hearing should have been held

on the issue of recusal.

The conclusion that a law clerk “had to be” influenced

by the actions of a co-worker is compelled by neither

logic nor the record before us. Furthermore, the facts on

the record do not justify further inquiry. This claim is also

frivolous.

7. Sanctions for Frivolous Appeal

This court has discretion to award Schultz and NYDA

damages and double costs if it determines that this appeal

is frivolous. Fed. R. App. P. 38. They may be awarded

“as a matter of justice to the appellee{s] and as a penalty

against the appellant.” Fed. R. App. P. 38 advisory

committee note. Bartel and Mapleton have raised only

frivolous issues on this appeal. The sheer number of

claims of error makes the appeal no less frivolous.

Neither does the naked assertion of good faith make the

claims less unreasonable. The imposition of Rule 38

sanctions on Bartel and Mapleton is justified in this case.

Attorneys can be held jointly and severally liable with

their clients under Rule 38 for bringing frivolous appeals.

United States v. Potamkin Cadillac Corp., 689 F.2d 379,

381-82 (2d Cir. 1982); Muigai v. INS, 682 F.2d 334, 337

(2d Cir. 1982); see also 28 U.S.C. § 1927 (1982) (“[a]ny

attorney. . . who so multiplies the proceedings in any

case unreasonably and vexatiously may be required by the

court to satisfy personally the excess costs, expenses, and

attorneys’ fees reasonably incurred because of such con-

RE Te

lla

Appendix A

duct”); cf. In re Cosmopolitan Aviation Corp., 763 F.2d

507, 517 (2d Cir.), cert. denied, 54 U.S.L.W. 3407 (U.S.

Dec. 17, 1985) (sanctions for frivolous appeal also justi-

fied under inherent power of court).

Bartel’s and Mapleton’s counsel in this case should

have been on notice that our patience with frivolous

appeals is at an end. See, e.g., Beary v. West Publishing

Co., 763 F.2d 66, 69 (2d Cir.), cert. denied, 54 U.S.L.W.

3252 (U.S. Oct. 15, 1985); Potamkin Cadillac, 689 F.2d at

381-82; Muigai, 682 F.2d at 337. We refer him to our

“stern warning that the United States Courts are not

powerless to protect the public, including litigants who

appear before the Courts, from the depredations of those

. . who hold themselves out as attorneys but who abuse

the process of the Courts.” Jn re Hartford Textile Corp.,

659 F.2d 299, 305 (2d Cir. 1981).

In this case, counsel brought the same claims on appeal

that the district court had previously found to be frivo-

lous or baseless. The district court properly determined

that the original pleading was not well grounded in fact

and that it was not warranted either by existing law or by

a good faith argument for reversing existing law. See Fed.

R. Civ. P. 11. In his appellate brief and oral argument,

counsel attempted to obfuscate the fact that his clients

had no federai claim. Moreover, he fails even to offer a

good faith argument for reversing the precedents that are

so hostile to his clients’ claims.

Affirmed with double costs against appellants Bartel

and Mapleton and $1,000 attorneys’ fees as damages

against appellants’ attorney Michael Rikon, all in favor

of appellees Schultz and NYDA.

12a

APPENDIX B—DECISION OF THE UNITED STATES

DISTRICT COURT FOR THE EASTERN DISTRICT DATED

AUGUST 27, 1985

UNITED STATES DISTRICT COURT

EASTERN DISTRICT OF NEW YORK

85 C 993

BARTEL DENTAL BOOK CO. INC. and MAPLETON HOUSE

BOOKS, INC.,

Plaintiffs,

-against-

PETER J. SCHULTZ, DORMITORY AUTHORITY OF THE

STATE OF NEW YORK, VALIANT RIGGING &

TRANSPORTATION, INC., EDWARD A. PICHLER,

SHERIFF OF THE CITY OF NEW YORK and NEW YORK

PIGGYBACK WAREHOUSE, INC. |

Defendants.

MEMORANDUM AND ORDER

RUDICK and RIKON, P.C.

(Michael Rikon, Esq., of counsel)

New York, New York

for plaintiffs

13a

Appendix B

PAUL, WEISS, RIFKIND, WHARTON & GARRISON

(Martin Flumenbaum and David E. Nachman, Esqs., of counsel)

New York, New York

for defendants Peter J. Schultz and Dormitory Authority of the

State of New York

FREDERICK A.O. SCHWARZ, JR.

Corporation Counsel of the City of New York

(Kenneth P. Fee, Assistant Corporation Counsel, of counsel)

New York, New York

for defendant Edward A. Pichler

NICKERSON, District Judge

Plaintiffs brought this action under 42 U.S.C. § 1983, and

also alleged state law claims. The case has been discontinued as

to the private defendants and only Schultz, the Dormitory

Authority of the State of New York (the Authority) and Pichler

remain as defendants. They move to dismiss pursuant to Federal

Rule of Civil Procedure 12(b){1) and (6). On notice to both parties

at oral argument, the court treats it as a motion for summary

judgment. See Federal Rule of Civil Procedure 12(b)(6).

Defendants Schultz and Dormitory Authority also move for

sanctions under Federal Rule of Civil Procedure !1.

The following facts are undisputed. Plaintiffs Bartel Dental

Book Co. Inc. (Bartel) and Mapleton House Books, Inc.

(Mapleton) are in the business of buying and selling used books

and periodicals. Bartel held title to real property at 112 Crown

Street, Brooklyn (112 Crown), of which Mapleton was the lessee.

The Authority is a New York State public benefit corporation,

and Schultz is its Deputy Executive Director. The Authority and

l4a

Appendix B

Schultz participated in the condemnation proceedings whereby

the Authority acquired property (which included 112 Crown) to

build new facilities for Medgar Evers College, a part of the City

University of New York.

On August 9, 1983 the Supreme Court of the State of New

York-granted title to 112 Crown. On March 21, 1984 the plaintiffs

and the Authority entered into a settlement agreement.under which

the Authority was to pay Bartel a certain sum for its fee claim,

and Bartel, ‘‘satisfied, discharged, released and settled’’ all claims

‘*made or which could have been made’’ in the condemnation

proceeding. The Authority entered into a similar arrangement with

Mapleton for its fixture claim, but Mapleton specifically reserved

‘any claim for relocation costs’’ which Mapleton ‘‘may have.’”’

The agreement further provided thai the plaintiffs:

warrant and represent (a) that Mapleton is the only

entity or person in possession of [the premises in

question]; and (b) that Mapleton is the only person

or entity who has any right, title or interest in or

to any and all of the fixtures located in or about

[the premises].

Mapleton continued, however, to occupy the premises, and

in April of 1984 the Authority moved in the Supreme Court of

the State of New York for eviction pursuant to the Eminent

Domain Procedure Law Section 405. On May 7, 1984, on

consideration of the papers submitted by the Authority and

Mapleton, Judge Leone granted the Authority’s motion and

ordered Mapleton to vacate the premises by May 10, 1984.

Mapleton then brought on a series of motions and appealed.

The Appellate Division at first granted a stay, but on July 27,

I5a

Appendix B

1984 vacated the stay. On September 12, 1984 the Appellate

Division denied an order to restrain eviction. When the Sheriff

began to remove Mapleton’s books from the premises Mapleton

brought an Article 78 proceeding and applied for a restraining

order against removal. The Kings County Supreme Court denied

the order, and on September 21, 1984 denied a preliminary

injunction. On March 12, 1985 the Appellate Division dismissed

the appeal from the original eviction order for failure to perfect

the appeal.

The compiaint in the present case includes twelve claims, three

federal claims pu:suant to 42 U.S.C. § 1983 and nine pendent

state claims. The first claim is against Schultz for refusing ‘‘to

apply or give the same relocation benefits to plaintiffs as it did

to other claimants.’’ The second is against Schultz and the

Authority and appears basically to allege that plaintiffs were denied

due process by failure to receive a ‘‘plenary’’ or ‘‘evidentiary’’

hearing on their relocation costs prior to eviction. The third federal

claim is against Schultz and the Authority alleging that plaintiffs

failed to receive ‘‘just compensation’ for the relocation of their

property.

I

Bartel has no claim against the Authority and its agents. On

March 21, 1984 Bartel executed a release and an agreement settling

all its claims against the Authority. Bartel, unlike Mapleton, did

not reserve a claim for relocation costs. The agreement and release

make it clear that Bartel’s claims are frivolous.

Mapleton’s federal claims are barred by the doctrines of issue

16a

Appendix B

and claim preclusion. Mapleton’s second claim, asserting a due

process challenge to the failure of the state courts to grant a pre-

eviction evidentiary hearing on relocation expenses, was raised

in the state courts.

In moving to reargue Judge Leone’s decision, Mapleton

argued that the court should have set the matter down for a

**plenary hearing’’ on the relocation issue. An affidavit of Sidney

Baumgarten, the lawyer for Mapleton at that time, shows that

Mapleton also argued before Judge Leone on the original motion

that he should hold a plenary hearing on the issue.

Mapleton continued to argue on appeal and in its motions

for stays that a plenary hearing should have been held, anc that

it had a right to relocation expenses under ‘‘the Federal and State

Constitutions.’’ In seeking a preliminary injunction on September

21, 1984, while its appeal of Judge Leone’s decision was still

pending, Mapleton again contended that it was entitled to

relocation casts and a plenary hearing on the manner in which

the books should be moved.

Mapleton’s claims were raised, or could have been raised,

in the state court proceedings and are now precluded by the

doctrines of collateral estoppel and res judicata. See Migra v.

Warren City School District Board of Education, 104 S. Ct. 892

(1984); Wright v. National Bank of Stamford, 600 F. Supp. 1289,

1299-1300 (N.D.N.Y. 1985). The state court judgments are binding

in a later section 1983 claim, Allen v. McCurry, 449 U.S. 90 (1980),

and even if a constitutional claim has not actually been litigated.

See Migra, supra, 104 S. Ct. at 897-98 & n.6 (in effect reversing

the rule of Lombard v. Board of Education, 502 F.2d 631 (2d

Cir. 1974), cert. denied, 420 U.S. 976 (1975)). A state court decision

denying relief is no less preclusive because no opinion has been

17a

Appendix B

written. See Winters v. Lavine, 574 F.2d 46, 60-61 (2d Cir. 1978).

Since Mapleton would be precluded from again raising its

claims in the New York courts, Mapleton is also barred from

relitigating those claims here. Its three federal claims arise out

of the same transaction, and were or could have been presented

to the state courts. Mapleton was not denied a full and fair

opportunity to litigate those clains, including the claim that a pre-

eviction hearing should have been held. See generally Taylor v.

New York City Transit Authority, 433 F.2d 665 (2d Cir. 1970);

Samuelil v. The New York Racing Association, Inc., 600 F. Supp.

819 (E.D.N.Y. 1985); Heimbach v. Chu, 744 F.2d 11, 13-14 (2d

Cir. 1984).

Schultz concedes that Mapleton’s first federal claim, asserting

that he refused to accord relocation benefits which he granted

others, was not actually litigated in the state proceedings. Nor

was he a named party in those proceedings. New York has

abandoned the requirement of mutuality, but it does require that

the party against whom the collateral estoppel doctrine is invoked

have had a ‘‘full and fair opportunity’’ to litigate the issue. See

Winters, supra, 574 F.2d at 58 n.14.

Although plaintiff does not explicitly state in what capacity

Schultz is sued, he is clearly joined in his official capacity as the

Deputy Executive Director of the Authority. For the purposes

of this action Schultz is in privity with the Authority, which can

only act through its employees and agents, and shares an identity

of interest with the Authority. Mapleton’s first claim against

Schultz is thus precluded by the doctrine of res judicata. Cf.

Andrasko v. Calkins, 47 Misc.2d 816, 263 N.Y.S.2d 256 (1965);

Rooney v. Tutano Contracting Corp., 43 Misc.2d 358, 251

N.Y.S.2d 392 (1964).

18a

Appendix B

Ill

Even were the federal claims not barred by the doctrines of

collateral estoppel and res judicata, they do not state valid claims

under § 1983. There is no federal constitutional right to relocation

costs. See, e.g., United States v. Westinghouse Electric & Mnf’g

Co., 339 U.S. 261 (1950). There is also no state constitutional

right to such costs, and plaintiffs do not assert a statutory right.

Thus there is no right for which process is due. City of Buffalo

v. Mollenberg-Betz Machine Co., 53 Misc.2d 849, 279 N.Y.S.2d

842 (1966).

Nor has Mapleton shown facts to support an equal protection

claim. In substance Mapleton contends that Schultz should have

offered in moving costs $947,710, one of the estimates obtained

by the Authority, or a higher amount in accordance with plaintiffs’

estimates. Instead he offered a considerably lower sum based on

other estimates. However, Mapleton makes no factual showing

that Schultz adopted different criteria in determining the amount

to be offered to Mapleton from the criteria used to establish offers

to other claimants. ‘

IV

Schultz and the Authority move for costs and attorney’s fees

under Federal Rule of Civil Procedure 11. That rule states that

the signature of an attorney or party constitutes a certificate by

him that to the best of his knowledge ‘‘after reasonable inquiry’’

the pleading is ‘‘well grounded in fact and is warranted by existing

law or a good faith argument for the extension, modification,

or reversal of existing law... .’’ The standard is intended to

be more exacting than the previous good-faith formula.

19a

Appendix B

There is no basis in law or fact for claims by Bartel which

released the Authority of liability. Indeed, Bartel’s current attorney

witnessed that agreement. The only one of Mapleton’s federal

claims which the court considers to rise above frivolity is the first

claim. The court will therefore award fees for work fairly

uttributable to work done in defending again all claims except

Mapleton’s first claim.

Plaintiffs’ attorney participated in parts of the state court

proceedings and was familiar with the course of the litigation.

Plaintiffs and their attorney shall share equally the burden of

paying the attorneys’ fees incurred in defending this suit and are

held jointly and severally liable for that amount. See Raffe v.

Citibank, No. 84-305 (E.D.N.Y. Aug. 1, 1984).

Vv

Defendants’ motions are granted and the complaint is

dismissed, including the pendent state claims. See Duntion v.

County of Suffolk, 729 F.2d 903, 910-i1 (2d Cir. 1984).

Defendants Schultz and the Authority shall submit affidavits of

hours spent, fees sought and costs. So ordered.

Dated: Brooklyn, New York

August 27, 1985

s/ Eugene H. Nickerson

Eugene H. Nickerson, U.S.D.J.

20a

APPENDIX C—RELEVANT CONSTITUTIONAL

PROVISIONS AND STATUTES

The provision of the United States Constitution involved is

Section 1 of the Fourteenth Amendment which provides in relevant

part that

‘*No State shall make or enforce any law which

shall abridge the privileges or immunities of citizens

of the United States; nor shall any State deprive

any person of life, liberty, or property, without

due process of law; nor deny to any person within

its jurisdiction the equal protection of the laws’’.

42 United States Code, Section 1983 provides

**§ 1983. Civil action for deprivation of rights

Every person who, under color of any statute,

ordinance, regulation, custom, or usage, of any

State or Territory, subjects, or causes to be

subjected, any citizen of the United States or other

person within the jurisdiction thereof to the

deprivation of any rights, privileges, or immunities

secured by the Constitution and laws, shall be liable

to the party injured in an action at law, suit in

equity, or other proper proceeding for redress’’.

Sectiofi 74-b of the General Municipal Law (West) provides

‘*§ 74-b. Payment of moving and relocation

expenses of residential and commercial owners and

tenants of appropriated property.

1. The chief fiscal officer of every municipal

2la

Appendix C

corporation shall establish and may amend rules

and regulations authorizing the payment of

reasonable and necessary moving expenses or

occupants of property acquired by condemnation

Or agreement, such payments not to exceed one

thousand dollars in the case of an owner or tenant

of residential property and twenty-five thousand

dollars in the case of an owner or tenant of

commercial property. Such rules and regulations

may further define the terms used in this section. .

Application for such payment shall be made to

the chief fiscal officer of such municipal

corporation upon forms prescribed by him and

shall be accompanied by such information and

evidence as he may require. Upon approval of such

application, the chief fiscal officer of such

municipal corporation shall deliver a copy thereof

to the treasurer of the municipal corporation or

other officer of such municipal corporation

exercising corresponding functions together with

a certificate stating the amount due thereunder,

and the amount so fixed shall be paid out of the

municipal corporation treasury after audit by the

comptroller of the municipal corporation or other

officer of the municipal corporation exercising

corresponding functions from moneys

appropriated for,the acquisition of such property.

As used in this section ‘commercial property’

shall include property owned by an individual,

family, business concern (including the operation

of a farm) and a non-profit organization.

The provisions of this subdivision shall not

22a

Appendix C

apply to a city having a population of one million

or more.

2. In addition to the authorization of

subdivision one of this section, the governing body

of any municipal corporation may adopt and

amend rules and regulations authorizing the

payment of relocation assistance allowances,

related and other necessary expenses as described

in the uniform relocation assistance act to owners

or occupants of property or ahy interest therein

acquired or to be acquired by such municipal

corporation by condemnation, agreement or

otherwise and for which federal funds shall be used

toward the cost of such acquisition. Such rules and

regulations may further define the terms used in

this subdivision. In acquiring real property for

which federal funds shall be used, the municipal

corporation is hereby authorized to do such other

and further acts not hereby specifically provided

as may be necessary to comply with such uniform

relocation assistance act. Application for such

payment shall be made to the officer of such

municipal corporation designated by the governing

body, upon forms prescribed by him and shall be

accompanied by such information and assistance

as may be required to substantiate entitlement

thereto. Pdyment shall be made as provided in such

rules and regulations from moneys appropriated

for the acquisition of such real property or interest

therein.

23a

Appendix C

3. As used in this section, the following terms

shall have the following meanings:

(a) ‘Municipal corporation’. A county, city,

town, village, school district, fire district, district

corporation and public authority.

(b) ‘Uniform relocation assistance act’. The

uniform relocation assistance and real property

acquisition policies act of nineteen hundred

seventy, being public law 91-646, as enacted by

the ninety-first Congress of the United States and

any federal laws amendatory or supplemental

thereto.

(c) ‘Governing body’. In a city, the legislative

body as defined in subdivision seven of section two

of the municipal home rule law, unless another

provision of law or the city charter vests another

officer or agency thereof with the power to fix and

promulgate, with the approval of the mayor,

schedules of relocation payments in which case,

governing body shall mean such other officer or

agency’’.