Opinion
30030/04.
January 15, 2009.
DECISION AND ORDER
Defendants, EUROPEAN DIGITAL PRODUCTIONS, INC., MAREK PODLECKI, INDIVDUALLY AND AS PRESIDENT OF EUROPEAN DIGITAL PRODUCTIONS, INC., "FORUM OF PRO POLONIA RIGHTS A/K/A 'FOPP'", MARGARET CHUDZIAK, INDIVIDUALLY AND AS "VOLUNTEER" OF FOPP, DARIUSZ MICHALSKI A/K/A DARIUSZ G. MICHALSKI, (hereinafter "Defendants"), move for an order, vacating the Order dated December 20th, 2007 denying Defendants' motion to dismiss for non appearance, and restoring the motion to the calendar for a hearing on the merits. Plaintiff opposes Defendants motion and cross moves for an Order granting Plaintiff Summary Judgment, dismissing the Defendants' counter claims, and disqualifying Garth Molander, Esq. as Defendants' counsel.
Upon reading Defendants' Notice of Motion to Vacate Default and Restore Matter to Motion Calendar, dated January 5th, 2008, together with the Attorney Affirmation in Support to Vacate Default and to Restore Defendants' Motion for Summary Judgment and as a Reply to the Plaintiff's Affirmation in Opposition, dated January 5th, 2008, by Garth Molander, Esq., counsel for Defendants, together with all exhibits annexed thereto; the Notice of Plaintiff's Cross-Motion, dated February 22nd, 2008, together with Plaintiff's Affirmation in Support of Cross-Motion and to Dismiss Defendants Counterclaims and Disquality Defendants' Counsel and grant Plaintiff Summary Judgment and Affirmation in Opposition to Defendants' Motion to Vacate Default and Defendant [sic] Summary Judgment, dated February 22nd, 2008, by Andrew Kaminski, Esq., pro se, and all exhibits annexed thereto (in two volumes); the Attorney Affirmation in Support to Vacate Default and to Restore Defendants' Motion for Summary Judgment and as a Reply to the Plaintiff's Affirmation in Opposition of Garth Molander, Esq., dated March 17th, 2008, and all exhibits annexed thereto; Memorandum of Law by Garth Molander, Esq., dated (March or May?) 28th, 2008; the Affirmation of Gregory J. Cannata, Esq., counsel for Plaintiff, dated June 26th, 2008, and all exhibits annexed thereto; the Attorney Affirmation in Reply of Garth Molander, Esq., dated August 6th, 2008, and the exhibit annexed thereto; the Further
Affirmation of Plaintiff Andrew Kaminski, undated, and the exhibit annexed thereto; all the proceedings heretofore had herein and after argument of counsel and due deliberation thereon, the motion is granted in part and the and cross motion is denied for the reasons set forth below.
Defendants moved for summary judgment dismissing the complaint by Notice of Motion returnable on December 2nd, 2007. On that date, Defendants' counsel did not appear until after the motion had been denied for non-appearance of the movant. Defendants now move to vacate the denial on default and have their motion granted on the merits.
In Star Industries, Inc. v. Innovative Beverages, Inc., ___ N.Y.S.2d ___, 2008 WL 4740048 (2nd Dept 2008), the Appellate Term stated, "To prevail on their motion to vacate their default, the defendants were required to demonstrate both a reasonable excuse for the default and the existence of a meritorious defense ( see CPLR 5015[a]; Papandrea v. Acevedo, 54 A.D.3d 915, 864 N.Y.S.2d 138; Vasquez v. New York City Hous. Auth., 51 A.D.3d 781, 859 N.Y.S.2d 195). The determination of what constitutes a reasonable excuse for a default lies within the sound discretion of the Supreme Court. ( See Antoine v. Bee, 26 A.D.3d 306, 812 N.Y.S.2d 557; Matter of Hye-Young Chon Country-Wide Ins. Co., 22 A.D.3d 849, 803 N.Y.S.2d 699).
In this case, Defendants' excuse for the default was that they were a few minutes late arriving to the calendar call. They argue they have shown a meritorious defense based upon this Court's prior order of August 24th, 2005, which found certain claims in the complaint to be non-actionable.
The law clearly favors the resolution of cases on the merits. Charmer Industries, Inc. v. 71 Grand Liquor Corp., 128 A.D.2d 825, 513 N.Y.S.2d 747 (2nd Dept 1987). Here, the Defendants' late arrival to argue the motion is an insufficient basis to deny them the opportunity to argue on the merits, where they have set forth persuasive arguments that they are entitled to at least partial summary judgment. The motion to vacate order of December 20 2007, denying Defendants' motion to dismiss is granted.
Upon hearing the motion and cross-motions for summary judgment on the merits, and based on the papers listed above, all proceedings had herein and after argument of counsel and upon due deliberation, the Defendants' motion for summary judgment is granted in part and Plaintiff's cross motion for summary judgment is denied for the reasons set forth below.
Motion or Partial Summary Judgment
The Plaintiff's underlying defamation action seeks damages based on the publication of statements made by the Defendants both in print and on the internet. By Order to Show Cause dated March 29th, 2005, Plaintiff sought a preliminary injunction to restrain the Defendants from publishing statements about the Plaintiff pending the outcome of the underlying action. This court denied the preliminary injunction in a decision dated August 24th, 2005. In that decision, this court categorized the statements upon which Plaintiff based its defamation claims into three categories: (1) those claiming that Mr. Kaminski committed fraud as a member if the Board of the Polish Slavic Federal Credit Union [hereinafter "PSFCU"], (2) those claiming that the Plaintiff had previously practiced law without a license, and (3) diverse disparaging remarks about Plaintiff's character. The Court found that the remarks falling into the third category were non-actionable as defamation.
Defendants seek, in the event the complaint is not dismissed in its entirety, an Order dismissing those claims found to be non-actionable in this Court's decision of August 24th, 2005. The statements in the third category should be dismissed for the reasons set forth in the August 24th, 2005 decision and order.
Thus, the only statements alleged in the complaint that are actionable as defamation are the following:
1) A letter written by Jozef Luczaj to the Board of Directors and the Supervisory Commitee of the Polish Slavic Federal Credit Union which was published in the May 3rd, 2003 edition of TAK newspaper. However, as the Court dismissed the complaint as to Mr. Luczaj, on July 24th, 2008, and TAK was never a named defendant in this matter, this alleged defamatory statement is no longer a part of this case.
2) A letter from Margaret Chudziak, dated February 19th, 2003, which was distributed to eighteen parties, including various media outlets. The letter annexes a modified copy of a report issued by Skadden Arps Meagher Flom, (hereinafter the "Skadden report"). In her letter, Chudziak states, "In plain language Mr. Kaminski defrauded PSFCU", and "In plain language, Mr. Kaminski committed mail fraud".
3) A communique by Defendant FOPP which appeared on the websitewww.monitorpolski.com, on March 1, 2003. On that web page, a series of photographs appear depicting interactions between various parties, including Chudziak, with captions which read, in pertinent part, "Here are the documents, that [sic] Andrew Kaminski defrauded the Credit Union".
4) Statements published in the Polska Gazeta on September 13th, 2004, which stated, in part, ". . . in those frauds he actively himself participated [sic] then Andrew Kaminski faces jail not only for practicing law without a license, but for his active participation in fraud". It later states that Plaintiff "for many years pretended to be an attorney".
5) Statements made by Irena Bocwinska in an article published in the Polska Gazeta on September 18-19, 2004. Although Ms. Bocwinska was dismissed from the case on May 24th, 2005, the article was published in the Polska Gazeta, which remains a Defendant in this action. The statements come in the form of an interview exchange between the interviewer and Bocwinska.
B — "he recommended, that I see a fabulous attorney, who is Kaminski."
I — "But Kaminski was then not an attorney. ."
B — "But I did not know about that". * * *
I — "Did Kaminski represent you then?"
B — Yes. Even though my friend Stanislawa Zimitko warned me about him. She asked me, whether I noticed, where Kaminski had his room. The last one, so that no one can see, how he takes bribes. Stasia warned me, that without a bribe he will not show up at the first trial."
I — "Now you have a new attorney . . ."
I-Yes, I changed and on the second hearing I was represented by David Wasserman from the firm of Sher Herman Bellone Tiporaph. At the hearing also appeared Kaminksi and stated that he is my attorney".
Defendants further seek dismissal of the rest of the complaint arguing that Plaintiff has failed to refute the truth of Defendants' statements; that Defendants merely republished already existing materials, and that Plaintiff has failed to demonstrate that Defendants acted with actual malice.
In the August 24th, 2005 Order, this Court determined that "the statements concerning the Plaintiff's activities as a member of the Board of Directors of the PSFCU are subject to the qualified 'public figure' privilege. Published statements regarding alleged wrongdoing at a federally chartered lending institution are clearly 'matters warraning public exposition' and are within the sphere of legitimate public concern. In order for speech concerning a public figure or speech within the "sphere of legitimate public concern" to be actionable, Plaintiff must show that it was false and published in a grossly irresponsible manner or without due consideration for the standards of information gathering and dissemination ordinarily followed by responsible parties. Chapaceau v. Utica Observer-Dispatch, Inc., 38 N.Y.2d 196, 379 N.Y.S.2d 61 (1975).
Defendants argue they are entitled to summary judgment as to that part of the complaint based on statements that Plaintiff committed fraud while at the PSFCU, because those statements simply republished information contained in a report prepared by the law firm of Skadden Arps for the Board of PSFCU. Defendants also argue that Plaintiff failed to state that the claims contained in the Skadden report are false or that Defendants had any malicious intent in publishing them.
Defendants also seek summary judgment as regards Plaintiff's claim that Defendants defamed him by accusing him of practicing law without a license. They argue that since the accusations had already been published by Plaintiff's prior clients, Defendants are not the appropriate party for a defamation claim.
The accusations that Plaintiff practiced law without a license pertain to his conduct as a private individual, but also involve a matter of public concern. Therefore as to those claims, Plaintiff must show that the statements were false and published in a grossly irresponsible manner.
Standard for Summary Judgment
Unlike the usual standard in a summary judgment motion, where the moving party must establish there is no triable issue of fact, in defamation cases, there is a higher burden upon a public figure plaintiff to demonstrate there exists an actionable claim. "[T]here is no issue for trial unless there is sufficient evidence favoring the nonmoving party for a jury to return a verdict for that party . . . If the evidence is merely colorable . . . or is not significantly probative . . ., summary judgment may be granted". Freeman v. Johnston, 84 N.Y.2d 52, 637 N.E.2d 268 (1994), citing Anderson v. Liberty Lobby, 477 US 242 (1986).
In order for Plaintiff to defeat Defendants' motion as to Defendants' statement that he committed fraud as a PSFCU board member, he must demonstrate that there is evidence in the record which could support a reasonable jury finding by clear and convincing evidence that the Defendants acted with actual [constitutional] malice. Freeman v. Johnson, 84 NY2d 52, 614 NYS2d 377 (1994); Catterson v North Suffolk Pub. Corp., 249 AD2d 498, 672 NYS2d 127 (2nd Dept. 1998); Watterson v City of Jamestown, 56 AD3d 1289, 867 NYS2d 815 (4th Dept. 2008).
Plaintiff's claims as to statements that he practiced law without a license involve his conduct as a private person concerning a matter of public concern. The standard applicable to these claims is whether the evidence in the record could support a reasonable jury finding that the plaintiff has shown actual [constitutional] malice by a preponderance of the evidence. McCormack v. County of Westchester, 286 A.D.2d 24, 731 N.Y.S.2d 58 (2nd Dept 2001).
In other words, in consideration of all of the evidence adduced on the record, the Defendants must show that even if a jury credited Plaintiff's submissions, it could not find actual malice by clear and convincing evidence as to the allegations of fraud, and by a preponderance of the evidence as to the allegations Plaintiff practiced law without a licence.
Allegations of Fraud
Defendants claim that Plaintiff has not refuted the allegations contained in the Skadden report and that Defendants merely republished it, and therefore there is no defamation. Defendants claim it was reasonable to rely on the Skadden report when they accused Plaintiff of committing fraud.
However, Plaintiff disputes the validity of the Skadden report in his affidavit. Furthermore he appends a subsequent legal opinion by Schulte Roth Zabel, LLC, dated March 23rd, 2003, which contests many of the issues which were raised in the Skadden report.
Although the Skadden report suggested that Plaintiff may have violated laws, the report's conclusions were qualified and stated that further investigation was warranted.
The letter authored by Margaret Chudziak, dated February 19th, 2003, included statements which were not contained in the Skadden report, namely that "[i]n plain language Mr. Kaminski defrauded PSFCU", and "[i]n plain language, Mr. Kaminski committed mail fraud".
The communique from FOPP, published March 1st, 2003, depicting a series of photographs with the caption, "[h]ere are the documents, that [sic] Andrew Kaminski defrauded the Credit Union", was allegedly republished in reliance upon the Skadden report.
These statements were not merely a republication of the Skadden report. They went beyond the contents of the report to conclude that Plaintiff had committed fraud where the report indicated that he may have and further investigation was needed. Defendants can not rely on the argument that they merely republished the Skadden report because their statements went far beyond the clearly articulated limitations of the Skadden report.
Defendants have neither offered evidence that they undertook any investigation to determine whether the Plaintiff had committed fraud before publishing their statements, nor have they provided any alternate basis, other than the Skadden report, for having stated that the Plaintiff committed fraud.
Although Defendants annex a copy of a letter from Alex Storozynski, president of the Board of Directors of the PSFCU, to Plaintiff outlining charges to be answered at a special meeting, the letter is dated March 30th, 2006. This letter post dates the alleged defamatory statements.
Therefore, since the Skadden report explicitly stated that the report remained preliminary and drew no conclusion as to Plaintiff's having committed any fraudulent act, and Defendants have offered no evidence that they did any investigation to determine if Plaintiff committed fraud, a reasonable jury could conclude, by clear and convincing evidence, that the Defendants' charges that he committed fraud and mail fraud were made with reckless disregard for their truth.
Practicing Law Without a License
Defendants, in various statements detailed above, accused Plaintiff of practicing law without a license.
A statement was published in the Polska Gazeta on September 13th, 2004, asking "Polish People in New York" to contact FOPP with regard to wrongdoings by Plaintiff in handling workers' compensation claims. It reads, in part, ". . . in those frauds he actively himself participated [sic] then Andrew Kaminski faces jail not only for practicing law without a license, but for his active participation in fraud". It later refers to Plaintiff stating that he, "for many years pretended to be an attorney".
An interview of Irena Bocwinska, an alleged former client of Plaintiff's, appeared in an article published September 18-19, 2004, in the Polish Gazette. The statements made in her interview, when taken together, allege Plaintiff practiced law prior to his being an attorney.
Plaintiff, in response, vehemently denies having held himself out as an attorney prior to his admission to the bar and he denies having engaged in any conduct requiring bar admission before being admitted.
In support of their contentions that Plaintiff practiced law without a license, Defendants submit an inter-office memo from John R. Oh, who appeared on behalf of a plaintiff named Romauld Dymski in a proceeding on January 8th, 1999. In the memo, Oh asserts that Kaminski, while a law student, provided assistance to the pro se defendant in the action. He further states that Kaminski was admonished by the judge for modifying an Order after it had been signed. The inter-office memo bears no firm name nor is it a sworn statement so it will not be considered in determining this motion.
Defendants also claim that Plaintiff drafted certain documents, including an affidavit, which could ultimately be used in a legal proceeding. These assertions even if true are not sufficient to support an allegation of practicing law without a licence.
Defendants also submit a transcript of a hearing in an action in the U.S. District Court for the State of New Jersey. The plaintiff in that matter, Krystyna M. Kruszynska, had alleged that Kaminski held himself out as an attorney to her and Boleslaw Karczmarzyk, as well as to the public at large. However the Judge in the matter made no findings of fact as to whether the allegations set forth in the complaint were true.
Defendants also produce an affidavit from a Franciszek C. Kulon who states that Plaintiff held himself out as an attorney when he hired Plaintiff to assist him with an immigration matter.
However, no documentary evidence, such as an appearance as legal counsel prior to being admitted to the bar, has been offered which would establish conclusively that Plaintiff committed the crime of practicing law without a licence. Although the affidavits of Plaintiff's former clients submitted by Defendants' contradict Plaintiff's affidavit that he did not practice law before being admitted, the conflicting affidavits merely demonstrate that there is a question of fact to be determined.
The evidence in the record as to whether Plaintiff held himself out as an attorney or performed legal work without a license turns on issues of credibility which are best determined through testimony of witnesses subject to cross examination at trial. Neither party has established that a reasonable jury, based on the evidence in the record, could only decide the question in their favor.
Plaintiff's motion for summary judgment should be denied, as well, because as discussed above, there remain questions of fact both as to the falsity of the Defendants' statements and as to whether Defendants acted with actual malice.
The disqualification of Garth Molander, Esq.
Finally, in his cross motion, Plaintiff seeks the disqualification of Defendants' counsel, Garth Molander, Esq. Plaintiff asserts that Molander is a likely witness in this matter and therefore he should be disqualified from representing Defendants. Plaintiff cites Stober v. Gaba, 259 A.D.2d 554 (2nd Dept 1999), for the proposition that the law errs on the side of disqualification where there are doubts as to whether a party's counsel may be required to be a witness.
In Horn v. Municipal Information Services, Inc., 282 A.D.2d 712, 724 N.Y.S.2d 320, the Second Dept. addressed the issue of the disqualification of counsel during litigation. "It is well settled that the disqualification of an attorney is a matter which rests within the sound discretion of the court. A party's entitlement to be represented in ongoing litigation by counsel of its own choosing is a valued right which should not be abridged absent a clear showing that disqualification is warranted and the movant bears the burden on such motion". (Internal citations omitted). "Whether a witness ought to testify is not alone determined by his or her possession of relevant knowledge or involvement in the transaction at issue. Disqualification may be required 'only when it is likely that the testimony to be given by the witness is necessary'." 108th Street Owners Corp. v. Overseas Commodities Ltd., 238 A.D.2d 324, 656 N.Y.S.2d 942 (2nd Dept 1997), citing SS Hotel Ventures Ltd. Partnership v 777 S. H. Corp., 69 N.Y.2d 437, 515 N.Y.S.2d 735 (1987).
Plaintiff argues that Molander has a "close personal relationship" with Defendants Dariusz Michalski and Margaret Chudziak. Plaintiff states that Molander's letterhead bears Michalski and Chudziak's address and therefore it is "obvious the two defendants and Mr. Molander share [sic] same offices. Mr. Molander has an economic stake in this case."
The mere fact that Molander may share an address with his clients provides no basis to disqualify Molander as Defendants' attorney.
Plaintiff further argues that the manner in which Molander notarized certain statements offered in opposition to Plaintiff's order to show cause warrants his removal from representing Defendants. Plaintiff argues that by Molander's "reconstructing" witness statements he "removed himself as an advocate and became an active participant requiring his testimony as a witness.
The manner in which Molander produced the affidavits may call the credibility of the affidavits into question. However, it will be testimony of the affiants, and not that of Molander, which would be required to clarify what the affiants intended to state.
Plaintiff has neither specified how Molander's testimony would be relevant nor has Plaintiff provided a basis for finding that Molander's testimony is necessary to the outcome of the subject litigation, as is required by the Second Department. Stober v. Gaba, 259 A.D.2d 554 (2nd Dept 1999). Accordingly, the Plaintiff's application to disqualify Molander should be denied.
WHEREFORE, Defendants' motion for summary judgment is granted only to the extent of dismissing claims as to the statements held to be non actionable in the Court's August 24th, 2005, decision and Plaintiff's cross motion for summary judgment and to disqualify Defendants' counsel is denied in its entirety, and it is hereby;
ORDERED that all claims for defamation in the complaint are dismissed except those arising from the following statements:
1) Statements contained in a letter by Margaret Chudziak, dated February 19th, 2003, that, "In plain language Mr. Kaminski defrauded PSFCU", and "In plain language, Mr. Kaminski committed mail fraud".
2) Statements in a communique by FOPP which appeared on the websitewww.monitorpolski.com on March 1, 2003, which read in pertinent part, "Here are the documents, that [sic] Andrew Kaminski defrauded the Credit Union".
3) S:atements published in the Polska Gazeta on September 13th, 2004, that ". . . in those frauds he actively himself participated [sic] then Andrew Kaminski faces jail not only for practicing law without a license, but for his active participation in fraud", and that Plaintiff "for many years pretended to be an attorney".
4) Statements, detailed above, by Irena Bocwinska in an article published in the Polska Gazeta on September 18-19, 2004, indicating that Plaintiff practiced law without a licence.
This constitutes the decision and order of this Court.