FCS Capital LLC v. Thomas

579 F.Supp.3d 635

FCS CAPITAL LLC et al., Plaintiff,

v.Joshua L. THOMAS, Esq., Defendant

CIVIL NO. 20-5580

United States District Court, E.D. Pennsylvania.

Signed January 11, 2022

Lionel Camillo Artom-Ginzburg, The Franklin, Philadelphia, PA, for Plaintiff.

Joshua Louis Thomas, Joshua L. Thomas & Associates PLLC, Chadds Ford, PA, for Defendant.

MEMORANDUM

KENNEY, District Judge Plaintiffs claim that Defendant committed legal malpractice in relation to a summary judgment motion in prior litigation before Judge Wolson, which resulted in a $54,000.00 judgment and subsequent sanctions against them in the sums of $7,029.08¹ and $554.00. They argue if Defendant had simply responded to the summary judgment motion on behalf of his clients, summary judgment would not have been entered against them. It is undisputed that no response to the summary judgment motion was filed. In subsequent testimony before Judge Wolson, Defendant admitted that during the relevant time period, he had a meritorious defense to the summary judgment motion that he failed to file, and in a consented to Joint Petition and notarized affidavit submitted by Defendant to the Pennsylvania Supreme Court Board of Discipline, Defendant also admitted that he had no excuse for missing any filing deadline in relation to his representation of Plaintiffs in the underlying action. Plaintiffs argue that Defendant's conduct throughout was so egregious that a reasonable jury would be compelled to not only find Defendant culpable of legal malpractice, but also to award punitive damages on the undisputed parts of this record. This Court agrees, and for the reasons that follow, judgment will be entered on behalf of the Plaintiffs in the amount of $61,584.08 ($54,000.00 summary judgment award issued by Judge Wolson; $7,029.08 sanctions; $554.00 sanctions; and $1.00 punitive damages. The FCS parties satisfied the judgment on January 8, 2021).

More specifically, Plaintiffs FCS Capital LLC, Barry Shargel, and Emil Yashayev (collectively, the "FCS Parties"), seek relief for their claims of legal malpractice arising from both professional negligence and breach of contract, as well as punitive damages against Defendant Joshua L. Thomas. ECF No. 1. Before the Court currently is Plaintiffs’ Motion for Summary Judgement (ECF No. 30), Defendant's Response in Opposition (ECF No. 34), and Plaintiffs’ Reply (ECF No. 35). For the reasons that follow, this Court GRANTS Plaintiffs’ Motion for Summary Judgment (ECF No. 30) with respect to Counts I and II for legal malpractice arising out of professional negligence and breach of contract, as well as to Count III for punitive damages. Judgment in the amount of $61,584.08 will be entered on behalf of the Plaintiffs and an appropriate order will follow.

I. BACKGROUND

In August 2018, an individual, James Everett Shelton, sued the current Plaintiffs, FCS Capital, LLC, Barry Shargel, and Emil Yashayev,² in the United States District Court for the Eastern District of Pennsylvania involving alleged violations of the Telephone Consumers Protection Act of 1991 ("TCPA").³ ECF No. 30 at ¶ 3; Shelton v. FCS Cap. LLC , No. 2:18-CV-03723-JDW, 2019 WL 6726404 (E.D. Pa. Dec. 11, 2019), motion for relief from judgment denied , No. 2:18-CV-03723-JDW, 2020 WL 3265174 (E.D. Pa. June 17, 2020) (the "Shelton Matter").

Shortly thereafter, the FCS Parties were introduced to attorney Joshua Thomas by a business associate, Robert Jacovetti, and in September 2018, the FCS Parties retained Mr. Thomas as their defense attorney in the Shelton Matter. ECF No. 30 Exhibit 8 at p. 177:5-6; Id. Exhibit 10. At that time Mr. Thomas was admitted to the practice of law in both Pennsylvania and New Jersey. Id. at ¶ 6.

Mr. Robert Jacovetti, and his law firm, Jacovetti Law P.C., were initially also named as co-defendants in the Shelton Matter, however, on February 6, 2019, Plaintiff Shelton voluntarily dismissed Mr. Jacovetti and Jacovetti Law P.C. from the case.⁴ Id. Exhibit 1 at Dkt. No. 17.

Despite Mr. Jacovetti being dismissed from the Shelton Matter, Mr. Thomas alleges that he frequently communicated with the FCS Parties about the case through Mr. Jacovetti and that Mr. Jacovetti would often set up three-way calls between himself, Mr. Thomas, and the FCS Parties to discuss the case. ECF 34 at p. 5. Mr. Jacovetti, Mr. Shargel, and Mr. Yashayev contest this assertion and maintain that Mr. Thomas rarely communicated with the FCS Parties and that they had trouble getting in contact with Mr. Thomas on numerous occasions. ECF No. 34 Transcript at pp. 177: 17-25, 178:1-12; ECF No. 30 Exhibit 8 at pp. 116:6-25, 117:1-11.

II. PROCEDURAL HISTORY IN THE SHELTON MATTER

Although there are additional facts related to Mr. Thomas’ representation of the FCS Parties upon which Mr. Thomas and the FCS Parties disagree, many of Mr. Thomas’ actions and inactions that are at issue in the present case are well-documented by the publicly available docket and filings in the Shelton Matter, and neither party contests the accuracy of the procedural timeline established by that docket. Shelton , 2019 WL 6726404.

Accordingly, the relevant and undisputed procedural history in the Shelton Matter is as follows:

On September 17, 2019, Plaintiff Shelton filed a Motion for Summary Judgment based solely on admitted facts, as the FCS Parties had failed to produce any discovery including answers to Requests for Admissions, which, pursuant to Fed. R. Civ. P. 36(a)(3), were thus admitted. ECF No. 30 Exhibit 1 at Dkt. No. 35; Id. Exhibit 3; ECF No. 1 at ¶ 13-14; ECF No. 13 at ¶ 16-17.⁵

Pursuant to the relevant Scheduling Order and the United States District Court for the Eastern District of Pennsylvania Local Rules of Civil Procedure (the "EDPA Local Rules"), Mr. Thomas had until October 1, 2019⁶ (14 days later) to respond to Plaintiff Shelton's Motion for Summary Judgment on behalf of the FCS Parties. E.D.P.A. Loc. R. Civ. P. 7.1; ECF No. 30 Exhibit 1.

By October 1, 2019, Mr. Thomas had not filed a response to Plaintiff Shelton's Motion for Summary Judgment. ECF No. 30 Exhibit 1.

A week after that filing deadline had passed, on October 8, 2019, Mr. Thomas filed a Motion for an Extension of Time requesting an additional two weeks to provide a response to the pending summary judgment motion. Id. Exhibit 1 at Dkt. No. 39.

On October 8, 2019, however, the Motion for an Extension of Time was rendered moot when Judge Wolson, presiding over the Shelton Matter, struck Plaintiff Shelton's Motion for Summary Judgment for failing to adhere to the Court's policies and procedures. Id. Exhibit 1 at Dkt. No. 40, 42.

Later that same day, on October 8, 2019, Plaintiff Shelton filed an Amended Motion for Summary Judgment. Id. Exhibit 1 at Dkt. No. 41.

Pursuant to the EDPA Local Rules, Mr. Thomas had until October 22, 2019 (14 days later) to respond to Plaintiff Shelton's Amended Motion for Summary Judgment on behalf of the FCS Parties. Id. Exhibit 1 at Dkt. No. 41; E.D.P.A. Loc. R. Civ. P. 7.1.

By October 22, 2019, Mr. Thomas had not filed a response to the amended summary judgment motion and instead, again filed a Motion for an Extension of Time, requesting an additional two weeks to respond. ECF No. 30 Exhibit 1 at Dkt. No. 44.

On that same day, October 22, 2019, the Court denied Mr. Thomas’ Motion for an Extension of Time, noting that his request was filed the same day the response to Plaintiff Shelton's Amended Motion for Summary Judgment was due, that the "delay in seeking this extension" was "consistent with [the Defendants’] pattern of inattentiveness to this litigation," and that the Defendants had been "on notice of the issues to be raised and the diligence to be done to prepare a response ... for over a month, as Plaintiff [Shelton] first filed a motion [for summary judgment] on September 17, 2019." ECF No. 30 Exhibit 2; Id. Exhibit 1 at Dkt. No. 45.

More than a month later, on December 11, 2019, Mr. Thomas had still not filed a response to Plaintiff Shelton's Amended Motion for Summary Judgment on behalf of the FCS Parties, and the Court moved forward, granting the motion as to eight of its nine counts and awarding Plaintiff Shelton $54,000.00 in damages. ECF No. 30 Exhibit 1 at Dkt. Nos. 47, 48; Id. Exhibit 3.

Subsequently, on December 13, 2019, judgment was entered in favor of the FCS Parties with respect to the final remaining count, on the grounds that Mr. Shelton had failed to state a claim under the relevant statute. Id. Exhibit 1 at Dkt. Nos. 47, 48, 49; Id. Exhibit 3.

Pursuant to the EDPA Local Rules, Mr. Thomas had 14 days after the judgment was entered against the FCS Parties to file a motion for reconsideration, which he did not do. E.D.P.A. Loc. R. Civ. P. 7.1. Nor was any appeal taken within 30 days after judgment was entered. Fed. R. App. P. 4(a).

Instead, on January 27, 2020, 47 days after the $54,000.00 judgment was entered against the FCS Parties, Mr. Thomas filed an untimely Motion for Reconsideration. ECF No. 30 Exhibit 1 at Dkt. No. 50.

The Court denied Mr. Thomas’ Motion for Reconsideration on January 29, 2020. Id. Exhibit 1 at Dkt. No. 51.

On May 21, 2020, Plaintiff Shelton filed a Motion to Compel Post-Judgment Discovery, alleging the FCS Parties’ failure to produce post-judgment discovery. Id. Exhibit 1 at Dkt. No. 52.

On May 22, 2020, Plaintiff Shelton's Motion to Compel Post-Judgment Discovery was stricken for failure to comply with Judge Wolson's policies and procedures. Id. Exhibit 1 at Dkt. No. 53.

On May 25, 2020, Plaintiff Shelton filed a Renewed Motion to Compel Post-Judgment Discovery. Id. Exhibit 1 at Dkt. No. 54.

On May 26, 2020, the Court granted Plaintiff Shelton's Renewed Motion to Compel Post-Judgment Discovery, ordering the FCS Parties to answer post-judgment discovery by June 1, 2020. Id. Exhibit 1 at Dkt. Nos. 54, 55.

On June 1, 2020, Mr. Thomas filed a second untimely Motion for Reconsideration, as well as a Motion for a Preliminary Injunction asking to stay further post-judgment discovery until...