Failure to Discontinue Constitutes Bad Faith, Frivolous Continuation Warranting Sanctions (NY)

A Justice of the New York County Supreme Court recently imposed sanctions on a plaintiff who refused to discontinue against a defendant that made a showing of non-involvement in the happening of the subject accident.  In Burgund v. Verizon, plaintiff commenced a Labor Law action after he tripped and fell stepping off of a ladder during his work for Verizon. During the deposition of building’s managing agent, plaintiff learned of the potential involvement of a third party entity known as “A&S.” Thereafter, plaintiff named A&S Group and A&S Construction Corp., among others, as defendants in a separate case that was ultimately consolidated.

Upon service of the complaint, A&S Group’s principal immediately contacted plaintiff, explaining that A&S Group had never performed work in the building, never worked for Verizon or any of the other named defendants as a subcontractor or in any other capacity, had no involvement with A&S Corp or its principals, and was not even in existence at the time of the alleged accident. However, plaintiff’s counsel refused to discuss the matter until A&S Group was represented by counsel.

Thereafter, A&S Group composed a series of letters over the course of a one-year period, each requesting a voluntary discontinuance against. Each time, these letters went unanswered. Ultimately A&S Group moved for summary judgment in its favor, denying any liability and asserting that plaintiff wrongfully included it in the action without any factual basis. The Court granted the motion, finding that A&S Group had presented affirmative evidence that it never performed any work at the subject building, had no professional relationships with any of the named parties, and was not even a registered corporation at the time of the accident.

Further, the Court determined that “regardless of whether [p]laintiff originally brought the action in good faith, plaintiff’s repeated failure to voluntarily discontinue the action, despite three specific requests… constituted a bad-faith frivolous continuation that warranted sanctions.”

Thanks to Tyler Rossworn for his contribution to this post.