Opinion
DOCKET NO. A-3239-13T1
02-24-2016
KEITH P. SEQUEIRA, Plaintiff-Appellant, v. WELLS FARGO & CO., WELLS FARGO ADVISORS, LLC, WELLS FARGO BANK, PRUDENTIAL FINANCIAL, INC., PRUDENTIAL REAL ESTATE AFFILIATES, INC., DAVID CARROLL, individually and in his capacity as an employee supervisor, MICHAEL J. CARROLL, individually and in his capacity as an employee supervisor, MARGE CONNOLLY, individually and in her capacity as an employee supervisor, THOMAS F. DALY, individually and in his capacity as an employee supervisor, WILLIAM H. GOECKLER, individually and in his capacity as an employee supervisor, GLORIA GUILFORD, individually and in her capacity as an employee supervisor, JAMES E. HAYS, individually and in his capacity as an employee supervisor, DAVID J. KOWACH, individually and in his capacity as an employee supervisor, KATHERINE LINDHOLM, individually and in her capacity as an employee supervisor, DANIEL LUDEMAN, individually and in his capacity as an employee supervisor, MICHAEL MAMMOLITO, individually and in his capacity as an employee supervisor, ANTHONY McQUEEN, individually and in his capacity as an employee supervisor, BRAND MEYER, individually and in his capacity as an employee supervisor, DAVID MONDAY, individually and in his capacity as an employee supervisor, ROBERT E. MORRISSEY, JR., individually and in his capacity as an employee supervisor, STEVE NASH, individually and in his capacity as an employee supervisor, MARK OMAN, individually and in his capacity as an employee supervisor, KENNETH PARDUE, individually and in his capacity as an employee supervisor, JOHN PUZIO, individually and in his capacity as an employee supervisor, THERESA A. RODDY, individually and in her capacity as an employee supervisor, E. KENNEDY THOMPSON, and LAWRENCE DURSO, Defendants-Respondents, v. BRIAN BEGLEY, individually and in his capacity as an employee supervisor, DANIEL FORSMAN, and PARGAR, LLC, Defendants.
Keith P. Sequeira, appellant, argued the cause pro se. Rosemary S. Gousman argued the cause for the Wells Fargo respondents1 (Fisher & Phillips, LLP, attorneys; Colleen P. Tandy, on the brief). James P. Walsh, Jr. argued the cause for the Prudential respondents2 (Morgan, Lewis & Bockius, LLP, attorneys; Michelle S. Silverman and Nitin Sharma, on the brief).
NOT FOR PUBLICATION WITHOUT THE APPROVAL OF THE APPELLATE DIVISION Before Judges Alvarez, Ostrer and Haas. On appeal from Superior Court of New Jersey, Law Division, Monmouth County, Docket No. L-00925-12. Keith P. Sequeira, appellant, argued the cause pro se. Rosemary S. Gousman argued the cause for the Wells Fargo respondents (Fisher & Phillips, LLP, attorneys; Colleen P. Tandy, on the brief). James P. Walsh, Jr. argued the cause for the Prudential respondents (Morgan, Lewis & Bockius, LLP, attorneys; Michelle S. Silverman and Nitin Sharma, on the brief). PER CURIAM
The Wells Fargo defendants-respondents are Wells Fargo & Co., Wells Fargo Advisors, LLC, Wells Fargo Bank, David Carroll, Michael J. Carroll, Marge Connolly, Thomas F. Daly, William H. Goeckler, Gloria Guilford, James E. Hays, David J. Kowach, Katherine Lindholm, Daniel Ludeman, Michael Mammolito, Anthony McQueen, Brand Meyer, David Monday, Robert E. Morrissey, Steve Nash, Mark Oman, Kenneth Pardue, John Puzio, Theresa A. Roddy, E. Kennedy Thompson, and Lawrence Durso.
The Prudential defendants-respondents are Prudential Financial, Inc. and Prudential Real Estate Affiliates.
Plaintiff Keith P. Sequeira appeals from four November 13, 2013 Law Division orders which: (1) dismissed plaintiff's first amended complaint with prejudice against Prudential Financial, Inc. and Prudential Real Estate Affiliates, Inc. (collectively Prudential or the Prudential defendants); (2) dismissed the second amended complaint against Wells Fargo & Company, its related companies, and individual employees (collectively Wells Fargo or the Wells Fargo defendants) as to all claims previously asserted in plaintiff's prior lawsuit; (3) granted Wells Fargo's motion to strike plaintiff's complaint pursuant to Rule 4:6-4(b); and (4) denied plaintiff's motion to transfer a pending arbitration matter to the Law Division.
Sequeira v. Prudential Equity Group LLC (Sequeira I), No. A-0734-10 (App. Div. October 9, 2014), certif. denied, 222 N.J. 17 (2015).
Plaintiff also appeals from three March 5, 2014 orders which: (1) denied plaintiff's motion for reconsideration and his request that the court take "Judicial Notice . . . of Legal Fraud by" Wells Fargo and its attorney; (2) granted Prudential's motion to dismiss plaintiff's second amended complaint with prejudice and awarded Prudential attorneys' fees and costs incurred in making its motion to dismiss the complaint; (3) granted Wells Fargo's motion to dismiss plaintiff's complaint as to all claims previously raised by plaintiff in Sequeira I; (4) granted Wells Fargo's motion to strike plaintiff's pleadings pursuant to Rule 4:6-4(b); and (5) granted Wells Fargo's motion to dismiss count nineteen of the complaint with prejudice.
With the exception of the trial court's decision to award attorneys' fees and costs to Prudential, we affirm the November 13, 2013 and March 5, 2014 orders in all respects. We reverse the provision of the March 5, 2014 order that awarded attorneys' fees and costs to Prudential.
I.
The essential background facts are set forth in our earlier opinion in Sequeira I. Sequeira I, supra, slip op. at 1-13. The parties are fully familiar with those facts and the procedural history and, therefore, only a brief summary is necessary here.
In 1998, Prudential hired plaintiff to work as a financial advisor. Id. at 2. In July 2003, Prudential entered into a joint venture with Wachovia Securities, LLC (Wachovia), which resulted in the formation of a new entity. Ibid. After the merger, plaintiff was a Wachovia employee. Ibid.
On four occasions between 1999 and 2003, plaintiff alleged that "he heard his branch manager at [Prudential] make a racial or stereotypical comment about an employee." Ibid. While subsequently employed by Wachovia, plaintiff claimed that he was subjected to discrimination, retaliation, and a hostile work environment. Id. at 10.
On October 8, 2008, plaintiff filed a third amended complaint against the Prudential defendants and one of their employees, and against Wachovia and a number of its individual employees (collectively the Wachovia defendants). Ibid. In his complaint, plaintiff alleged, among other things, violations of the Law Against Discrimination (LAD), N.J.S.A. 10:5-1 to -49, against all of the defendants. Id. at 1-2.
Wachovia changed its name to Wells Fargo in May 2009. Plaintiff worked for Wells Fargo through August 6, 2010.
"In November 2008, the Prudential defendants filed a motion to dismiss the complaint for failure to state a claim" and, on January 23, 2009, the trial court granted the motion and dismissed all of plaintiff's claims against the Prudential defendants. Id. at 10-11. The court also denied plaintiff's motion for reconsideration. Id. at 11. On August 26, 2010, the court granted the Wachovia's defendants' motion for summary judgment and dismissed all of plaintiff's claims against them. Id. at 11-12.
Plaintiff appealed the court's August 26, 2010 order concerning his claims against the Wachovia defendants, but did not seek review of the dismissal of his claims against Prudential. Id. at 11 n.4. On appeal, we concluded that all of plaintiff's arguments were without sufficient merit to warrant discussion in a written opinion and affirmed the trial court's decision dismissing his complaint. Id. at 13; see R. 2:11-3(e)(1)(E).
While Sequeira I was pending in the trial court, Wells Fargo continued to employ plaintiff. On February 25, 2010, Wells Fargo loaned plaintiff $47,462.56 pursuant to a "Client Service and Loyalty Award - Level One Agreement" (The "4front agreement") and a promissory note that plaintiff signed. In pertinent part, the 4front agreement provided that "any action instituted as a result of any controversy arising out of [the 4front agreement] . . . shall be brought before the arbitration facility of" the Financial Industry Regulatory Authority (FINRA). Plaintiff and Wells Fargo also agreed "that arbitration shall be the parties' exclusive remedy and that the results of such arbitration shall be final and binding upon them."
The promissory note contained similar references to the arbitration requirement. The note also listed the termination of plaintiff's employment with Wells Fargo as an "event of default." According to plaintiff, the 4front agreement and promissory note "together, constituted one contract."
On August 6, 2010, Wells Fargo terminated plaintiff's employment. On May 18, 2012, it filed a statement of claim with FINRA, seeking arbitration to pursue its remedies under the 4front agreement and the promissory note.
On May 28, 2013, plaintiff filed a first amended complaint against the Wells Fargo and Prudential defendants. The complaint set forth facts, issues, allegations, and claims that arose out of the same set of events and transactions that were raised and decided in Sequeira I. As in Sequeira I, plaintiff asserted claims for discrimination, retaliation, and hostile work environment under the LAD; violation of the New Jersey Constitution; and claims for breach of contract. Indeed, plaintiff conceded throughout the complaint that it related to facts, issues, and allegations that were presented and litigated in Sequeira I. While plaintiff asserted that other portions of the complaint concerned previously "Un-Litigated Claims[,]" it did not. Rather, to the extent that the allegations in the pleading were decipherable, they referred to the same set of events and transactions that were addressed in Sequeira I.
On February 28, 2012, plaintiff filed his initial complaint against defendants, but it was dismissed on March 1, 2013 for lack of prosecution. The matter was reinstated on May 23, 2013.
The 135-page complaint had 463 separately-numbered paragraphs, more than 500 subparagraphs, and 95 footnotes. It also had an eight-page table of contents, a table of authorities, twenty-four counts, and four attached exhibits.
The Prudential defendants filed a motion to dismiss plaintiff's complaint for failure to state a claim pursuant to Rule 4:6-2(e) or, in the alternative, to strike the complaint pursuant to Rule 4:6-4(b). The Wells Fargo defendants filed a similar motion, seeking to dismiss all the claims that had already been addressed in Sequeira I and to strike any remaining claims. Plaintiff opposed these motions and filed a cross-motion requesting that default be entered against several defendants and for a transfer of the pending arbitration proceeding to the Law Division.
Following oral argument, the trial judge rendered an extremely thorough written decision dismissing plaintiff's complaint and denying his cross-motion. As to the motion to dismiss filed by the Prudential defendants, the judge found that all of the claims plaintiff raised against the Prudential defendants concerned his employment with Prudential, which ended in 2003. Thus, plaintiff had the opportunity to fully raise these contentions in Sequeira I, which resulted in the complete dismissal of his claims. To whatever extent plaintiff raised new allegations in his current complaint, the judge ruled that the claims were barred by both the entire controversy doctrine and the applicable statutes of limitations.
As the judge explained, plaintiff's LAD claims had already been fully considered:
[T]he allegations supporting [p]laintiff's claims against the Prudential [d]efendants for violation of the LAD concern his employment with [Prudential], which ended in 2003. Each of these claims were pursued in the 2008 Action, arise[] out of the same core set of operative facts as those underlying the 2008 Action, and involve[] identical parties. The Court dismissed these claims on January 23, 2009. Thus, the entire controversy doctrine bars . . . [p]laintiff from bringing these claims again.
Moreover, the statute of limitations for LAD claims is two years. Plaintiff's employment relationship with [Prudential] ended in July of 2003. Therefore, the last date when [p]laintiff could have asserted an LAD claim against . . . [Prudential] . . ., was July 2005, two years after his employment by [Prudential] concluded. Plaintiff did not bring this action until 2012. Accordingly, the [c]ourt grants the [Prudential d]efendants' motion and dismiss[es] the LAD claims against [them].
The judge also found no basis for plaintiff's contract claims against the Prudential defendants. The judge stated:
Plaintiff has also brought claims for breach of contract and breach of the implied covenant of good faith and fair dealing against the Prudential [d]efendants. These claims address conduct that allegedly occurred between July 14, 2003 and sometime in 2005. This conduct arose out of the same set of transactions or events that were the subject of [p]laintiff's 2008 Action . . . . [These] claims were dismissed in 2009. Since these contract claims arise out of the same transactions that were the subject of the 2008 [a]ction, [p]laintiff is precluded from bringing them in a separate action now under the entire controversy doctrine.
Moreover, the statute of limitations for actions alleging breach of a non-sales contract is six years. N.J.S.A. 2A:14-1. The same limitations period applies to claims for breach of the implied covenant of good faith and fair dealing. Plaintiff alleges actions occurring between 2003 and 2005, which supposedly form the basis for his claims of breach of contract and breach of implied covenant of good faith and fair dealing. Thus, [p]laintiff was obligated to assert these claims no later than 2011, and these claims are now time-barred.
The judge next found that plaintiff's claims alleging the intentional infliction of emotional duress were likewise based upon the same set of facts raised in Sequeira I. Therefore, these claims were also barred by the entire controversy doctrine and the two-year statute of limitations for intentional infliction of emotional distress claims, N.J.S.A. 2A:14-2. Finally, the judge found that plaintiff failed to present a prima facie case of fraudulent concealment against the Prudential defendants. Therefore, the judge dismissed the entire complaint against the Prudential defendants with prejudice.
Turning to the motion filed by the Wells Fargo defendants, the judge found that plaintiff's claims against these defendants had already been dismissed in Sequeira I. Thus, plaintiff was collaterally estopped from raising these claims again in his 2013 complaint.
The judge also granted Wells Fargo's motion to strike plaintiff's complaint pursuant to Rule 4:6-4. In finding that the complaint was too vague and confusing to be considered, the judge stated:
Rule 4:6-4(b) provides: "On the court's or a party's motion, the court may either (1) dismiss any pleading that is, overall, scandalous, impertinent, or, considering the nature of the cause of action, abusive of the court or another person; or (2) strike any such part of a pleading or any part thereof that is immaterial or redundant." Furthermore, Rule 4:5-7, entitled "Pleadings to Be Concise and Direct; Construction," provides: "Each allegation of a pleading shall be simple, concise and direct . . . ."
Plaintiff's [c]omplaint contains over 1,000 paragraphs of incomprehensible allegations and over twenty separate counts, some of which contain multiple causes of action. It is unclear against as to which [d]efendants the claims are asserted. It is also unclear as to what claims were included in or arise
out of [Sequeira I] . . . . Thus, the [c]ourt shall strike [p]laintiff's [c]omplaint and allow him thirty (30) days to refile his [c]omplaint in order to articulate his claims in a more concise way as required by R. 4:6-4(b).
Because the complaint was dismissed and stricken in its entirety, the judge denied plaintiff's motion to enter default against any of the defendants who had not yet filed answers. The judge also denied plaintiff's motion to transfer the arbitration proceeding to the Law Division. The judge found that the promissory note contained an arbitration clause which "clearly stated that 'any controversy arising out of this [n]ote . . . shall be brought before the facility of . . . [FINRA] to the exclusion of all others.'"
On November 13, 2013, the trial judge issued four orders memorializing these rulings. On December 19, 2013, and without leave of court, plaintiff filed his second amended complaint. Despite the fact that his prior complaint had been dismissed with prejudice against the Prudential defendants, and on collateral estoppel grounds against the Wells Fargo defendants, plaintiff's new pleading again repeated the allegations and claims that had been dismissed in Sequeira I.
The 155-page second amended complaint also did not address the Rule 4:6-4(b) problems that had required the prior complaint to be stricken. The new pleading was longer and even less comprehensible than the first amended complaint. It had 738 separately-numbered paragraphs, more than 400 subparagraphs, 195 endnotes, a thirteen-page table of contents, twenty-five counts, and five attached exhibits. In the only discernible "new claim" raised in the complaint, plaintiff alleged in count nineteen that Wells Fargo breached the 4front agreement. As discussed above, however, the dispute over the 4front agreement and the promissory note was being handled via arbitration.
Plaintiff also filed a motion for reconsideration of the court's November 13, 2013 rulings and asked that judicial notice be taken of "legal fraud" allegedly committed by Wells Fargo and its attorney.
On January 14, 2014, the Prudential defendants filed a motion to dismiss the second amended complaint with prejudice, and for attorneys' fees and costs incurred in making the motion. Prudential asserted that the first amended complaint had been dismissed with prejudice and, therefore, plaintiff had no basis for filing another complaint against it. While Prudential's motion brief asserted that it "explained" to plaintiff that his new filing against it was improper, Prudential did not submit a certification or any documentation demonstrating that the notice requirements of Rule 1:4-8(b) had been met, or an affidavit of service as required by Rule 4:42-9(b).
The Wells Fargo defendants also moved to dismiss the second amended complaint for failure to state a claim; to strike the complaint under Rule 4:6-4(b); and to dismiss count nineteen of the complaint with prejudice.
Following oral argument, the judge issued another comprehensive written opinion. In denying plaintiff's motion for reconsideration, the judge rejected plaintiff's assertion that the judge failed to consider all of plaintiff's contentions. The judge stated:
The [c]ourt based its November 13, 2013 decision upon a correct and clearly rational basis, and fully appreciated the significance of the probative, competent evidence. Plaintiff adamantly stresses that the [c]ourt failed to consider his November 4, 2013 brief and his subsequently corrected version that was delivered to the [c]ourt on the day of oral argument. This is blatantly incorrect. At oral argument, the [c]ourt accepted [p]laintiff's revised version of his November 4, 2013 brief and advised that while the [c]ourt could not read it, because it was delivered at oral argument, that the [c]ourt had fully reviewed the previous version submitted. . . . Therefore, [p]laintiff's argument that the [c]ourt failed to appreciate the significance of probative, competent evidence is without merit.The judge also found no basis for the court to take "judicial notice" of fraud allegedly committed by Wells Fargo or its attorney. Therefore, the judge denied both of plaintiff's motions.
The judge granted the Prudential defendants' motion to dismiss plaintiff's second amended complaint with prejudice. Plaintiff asserted that he was not aware that his prior complaint against Prudential had been dismissed with prejudice and, therefore, he believed he could again raise his previous contentions. The court found that this contention lacked merit because the November 13, 2013 order clearly stated that the complaint against the Prudential defendants had been dismissed with prejudice. The judge stated, "It is understandable how [p]laintiff, as a pro se plaintiff, could misinterpret the November 13, 2013 [o]rders[,]" but "it should now be unambiguously clear [that p]laintiff's [c]omplaint as to [the] Prudential [d]efendants was dismissed with prejudice."
The judge did not specifically address Prudential's motion for attorneys' fees and costs in his written decision. However, the March 5, 2014 order granted Prudential's motion, but did not set forth the amount of fees and costs awarded.
The judge granted Wells Fargo's motion to dismiss plaintiff's complaint because plaintiff had already been "precluded from relitigating all of the claims previously asserted in Sequeira I." The judge also struck plaintiff's complaint under Rule 4:6-4(b) because it again "contain[ed] incomprehensible allegations and it [was] still unclear as to which [d]efendants the claims are asserted." Because the dispute over the 4front agreement and promissory note was properly in arbitration, the judge dismissed count nineteen of the complaint with prejudice.
On March 5, 2014, the judge issued three orders memorializing his rulings. This appeal followed.
II.
On appeal, plaintiff raises fifty-one conclusory point headings that span almost eight pages of text in his appellate brief. Therefore, we will not repeat those contentions here. Suffice it to say, plaintiff challenges every aspect of the trial judge's rulings as embodied in the November 13, 2013, and March 5, 2014 orders.
We have considered plaintiff's contentions in light of the record and applicable legal principles and, with the exception of the provision of the March 5, 2014 order granting Prudential's motion for attorneys' fees and costs, we conclude they are without sufficient merit to warrant discussion in a written opinion. R. 2:11-3(e)(1)(E). We are satisfied that the trial judge properly dismissed plaintiff's first and second amended complaints and affirm substantially for the reasons expressed in his thoughtful and comprehensive written opinions.
However, we are constrained to reverse the award of attorneys' fees and costs to Prudential in the March 5, 2014 order. First, the trial court failed to provide essential findings of fact and conclusions of law to support its award of fees under the frivolous litigation statute, N.J.S.A. 2A:15-59.1. See Rule 1:7-4(a) (requiring the trial court to "find the facts and state its conclusions of law thereon . . . on every motion decided by a written order that is appealable as of right"). To support an award under the frivolous litigation statute, the court must find that the claim was pursued "in bad faith, solely for the purpose of harassment, delay or malicious injury[,]" N.J.S.A. 2A:15-59.1(b)(1), or "[t]he nonprevailing party knew, or should have known, . . . [it] was [pursued] without any reasonable basis in law or equity and could not be supported by a good faith argument for an extension, modification[,] or reversal of existing law." N.J.S.A. 2A:15-59.1(b)(2).
Here, the court made no findings on these issues. Instead, the court stated that "[i]t [was] understandable how [p]laintiff, as a pro se plaintiff, could misinterpret the November 13, 2013 [o]rders[,]" which indicates it believed the complaint may not have been filed in bad faith.
The award of fees must also be reversed because Prudential failed to comply with the notice and demand requirement of Rule 1:4-8. This rule requires the movant to describe the specific conduct alleged to have violated the rule, and include a certification that the movant served written notice and demand upon the attorney or pro se party who signed or filed the challenged pleading. R. 1:4-8(b)(1). The notice and demand must include a demand that the pleading be withdrawn, and notice that an application for sanctions shall be made within twenty-eight days of service. Ibid. This is known as the "safe harbor" provision. Toll Bros., Inc. v. Twp. of W. Windsor, 190 N.J. 61, 69 (2007).
Prudential's motion for attorneys' fees and costs did not include the certification required by Rule 1:4-8. While the procedural requirements of the rule can be relaxed on a case-by-case basis when compliance would not be practicable, AHSH-GTO Assocs. v. Irvington Pediatrics, P.A., 414 N.J. Super. 351, 363-64 (App. Div.), certif. denied, 205 N.J. 96 (2010), this is not such a case. Prudential also did not submit an affidavit of service as required by Rule 4:42-9(b). Therefore, we conclude that the trial court mistakenly exercised its discretion in granting Prudential's motion for attorneys' fees and costs, and reverse that portion of the March 5, 2014 order pertaining to the Prudential defendants.
A trial court's determination granting or denying fees and costs for frivolous litigation is reviewed for abuse of discretion. Ferolito v. Park Hill Ass'n, 408 N.J. Super. 401, 407 (App. Div.), certif. denied, 200 N.J. 502 (2009). --------
In sum, we affirm the November 13, 2013 and March 5, 2014 orders in all respects, with the exception of the award of counsel fees and costs to Prudential.
Affirmed in part, reversed in part. I hereby certify that the foregoing is a true copy of the original on file in my office.
CLERK OF THE APPELLATE DIVISION