Kaufman v. Travelers Casualty Insurance Company of America

Background

Stephen B. Kaufman and the Law Office of Stephen B. Kaufman, P.C. sued Travelers Casualty Insurance Company of America. Travelers removed the case from New York Supreme Court to the Southern District of New York and later answered the complaint.

The court initially ordered the plaintiffs to appear and explain why the case should not be dismissed for failure to prosecute. Ronald J. Schwartz then appeared as the plaintiffs’ lawyer. The court scheduled an initial pretrial conference and ordered the attorney who would serve as principal trial counsel to attend.

Mr. Schwartz did not attend the February 16, 2024 conference. The court rescheduled it for March 6, but Mr. Schwartz again did not attend. Another lawyer appeared and initially represented that he was associated with Mr. Schwartz, although the court found that representation was inaccurate. The court rescheduled the conference again and specifically warned that failing to attend could result in dismissal.

At the April 15, 2024 conference, Mr. Schwartz again did not appear. He had not asked to postpone the conference, sought permission to be absent, or notified the court or Travelers that he would not attend. Another lawyer appeared for the plaintiffs. Mr. Schwartz later stated that his age, physical condition, and involvement in a serious motor-vehicle accident prevented him from appearing at some conferences. His response did not explain why he failed to attend the virtual conferences or why he did not notify the court beforehand.

Travelers moved for dismissal under Federal Rule of Civil Procedure 41(b) and requested sanctions. The court separately ordered the plaintiffs to explain why the case should not be dismissed and ordered Mr. Schwartz to explain why sanctions should not be imposed.

Dismissal for Failure to Prosecute

Rule 41(b) permits dismissal when a plaintiff fails to prosecute a case or follow court orders. The court treated dismissal as a severe remedy and considered the duration of the failures, the plaintiffs’ notice that dismissal could result, possible prejudice to Travelers, the balance between court administration and the plaintiffs’ opportunity to be heard, and whether a less severe sanction would work.

The court concluded that dismissal was not warranted at that point. The plaintiffs’ failures involved a few scheduled conferences, and the likely prejudice to Travelers from further delay was not severe enough to justify dismissal. The court also noted that lawyers appearing for the plaintiffs had attended some conferences and that the plaintiffs promptly responded to the order to show cause. Although the plaintiffs had not prosecuted the case with the required diligence, the court found the circumstances were not sufficiently extreme and that a lesser sanction could address the problem.

The court therefore denied Travelers’ motion to dismiss for failure to prosecute without prejudice to renewal. The court warned that dismissal under Rule 41(b) likely would follow if the plaintiffs failed to appear when required, violated other court orders or rules, or otherwise failed to prosecute the case diligently.

Sanctions for Missed Conferences

Federal Rule of Civil Procedure 16(f) allows a court to impose sanctions when a party or lawyer fails to attend a pretrial conference or disobeys a pretrial order. The rule generally requires payment of reasonable expenses caused by the violation unless the failure was substantially justified or another circumstance would make an award unfair.

The court found sanctions appropriate because Mr. Schwartz failed to attend the February 16, March 6, and April 15 conferences and failed to follow orders requiring his attendance. The court stated that a violation of a pretrial order was enough to permit some sanction and did not need to find that Mr. Schwartz acted in bad faith.

The court approved Travelers’ request for two hours of its lawyer’s time at $290 per hour. It found both the hourly rate and the two-hour amount reasonable. The court therefore granted Travelers’ motion for sanctions and ordered Mr. Schwartz to pay Travelers $580 for counsel’s preparation and attendance at the April 15 conference. Mr. Schwartz was also ordered to file proof of payment by April 15, 2025.

Other Orders

The court scheduled an initial pretrial conference for April 25, 2025 and required the parties to file a revised joint letter and case-management plan. If Mr. Schwartz sought to withdraw, he was required to file an application by April 8, 2025. The order stated that failure of the plaintiffs’ lead trial counsel to comply with the stated requirements or attend the next conference would result in dismissal under Rule 41(b) without further notice.

Result

The opinion addressed litigation conduct and sanctions, not whether the plaintiffs’ underlying claims against Travelers were legally or factually valid.