In Alcivar v. Enhanced Recovery Co., No. 17-CV-2275 (ILG), 2020 U.S. Dist. LEXIS 88998, at *3-6 (E.D.N.Y. May 20, 2020), Judge Glasser awarded $33,916.84 in attorneys’ fees and $2,769.14 in costs to defense counsel based on the following facts.

Discovery proved contentious, in two ways. First, Tawanda Frazier refused to comply with Defendant’s subpoena. (ECF No. 16 at 2). Second, Plaintiff’s counsel denied Defendant’s repeated requests to depose the Plaintiff. When Defendant moved to extend the discovery schedule so that Plaintiff could be deposed at her convenience, Plaintiff’s counsel offered to stipulate to dismissal with prejudice. Defendant rejected that offer and persisted in its effort to depose the Plaintiff. Plaintiff’s counsel then advised Defendant that its client would not appear for any deposition. (Id.).  All this caused Magistrate Judge Bloom to question the nature of this case and Plaintiff’s involvement in it. Judge Bloom ordered Plaintiff to appear at a status conference, to no avail. Finding this behavior “unacceptable,” Judge Bloom then ordered an evidentiary hearing, requiring Plaintiff to appear with her attorneys, Harvey Rephen and Edward Geller, to explain her absence. (ECF No. 19 at 1-2). At the evidentiary hearing, Plaintiff was surprised to learn that a federal case in her name was currently pending before this Court. (ECF No. 30, “Pl’s. Test.” 31:15-32:8). Her testimony revealed that she had no involvement in bringing the case, other than signing an initial retainer whose true purpose she did not understand. (Id. at 12:14-13:7). She was not aware of any discovery requests, or of interrogatories which were answered in her name. (Id. at 20:18-23). Plaintiff also admitted that she had no reason to dispute her debt. She simply fell behind on payments and wanted her credit repaired. (Id. at 19:21-20:23). At or about the same time, Tawanda Frazier was deposed under oath in Eisner v. Enhanced Recovery Company, No. 17-CV-01240 (LDH) (ST), 2019 WL 5781119 (E.D.N.Y. Aug. 20, 2019), another case against Defendant in which the plaintiff was also represented by the Rephen Firm. (ECF No. 28-2, “Frazier Dep.”). Frazier’s Eisner testimony, which this Court accepts in accordance with Fed. R. Evid. 804(b)(1), reveals her close working relationship with the Rephen Firm. (Frazier Dep. 34:11-39:7, 67:12-15). Following a script, Frazier would call debt collectors and ask them leading questions to elicit violations of the FDCPA. (Id. at 22:22-23:1, 36:2-36:5). She would dispute the account in every instance, irrespective of any justification to do so. (Id. at 26:3-20). Conversations containing purported violations were then funneled to the Rephen Firm. (Id. at 148:7-20). Shortly thereafter, the parties dismissed this case with prejudice on the condition that Defendant be permitted to move for attorneys’ fees at a later time. (ECF No. 42). Defendant now makes such motion under 15 U.S.C. § 1692k(a)(3), 28 U.S.C. § 1927 and the Court’s inherent authority. (ECF Nos. 33, 43, 44). The facts recited above compel the following conclusion: that this case was presented by the Rephen Firm without its client’s knowledge, alleging facts that [Plaintiff’s counsel] knew or should have known to be false. An award of attorneys’ fees and costs is warranted under 15 U.S.C. § 1692k(a)(3), or in the alternative, 28 U.S.C. § 1927 and this Court’s inherent authority.

The District Court held:

[The Plaintiff’s counsel] brought this case without its client’s knowledge or involvement, and therefore in bad faith. Furthermore, it did so with the purpose of extracting a monetary award from the Defendant, for a harm its client did not suffer. Such behavior is not merely “harassment.” It is, without making a “fortress out of the dictionary,” Cabell v. Markham, 148 F.2d 737, 739 (2d Cir. 1945) (Hand, L., J.), aff’d 326 U.S. 404 (1945), more than annoyance or unwelcome conduct. It is nothing less than an attempt to transform a consumer protection statute into an ATM machine.  In opposing Defendant’s motion, Plaintiff’s counsel urges this Court to consider the “chilling effect” sanctions would have on “consumers who have what they and their attorneys credibly believe to be valid grievances against debt collectors.” (Pl’s. Opp’n 12). The sanctions imposed by this Court will not have a chilling effect on honest consumers or advocates. The purpose of § 1692k(a)(3)’s cost shifting provision is to prevent nuisance lawsuits. A case more precisely tailored to violate this statute would be difficult to imagine.

The District Court also held that alternative basis existed for sanctions.

Accordingly, an alternative basis for sanctions exists in 28 U.S.C. § 1927 and the Court’s inherent power. The Court is mindful that “[s]anctions are a serious consequence that must be well-justified,” Eisner, 2019 WL 5781119, at *5. But the [counsel’s] behavior—filing a meritless case without its client’s involvement—crosses that high bar.