Ottoson v. SMBC Leasing and Finance, David Ward, and Lisa Lisa Savinon

Background

Maureen Ottoson brought employment-discrimination and retaliation claims under the Americans with Disabilities Act and the New York City Human Rights Law. She represented herself at trial. In July 2019, a jury found for her on one claim—retaliation under the New York City law—and awarded $21,250 in backpay. The jury did not find for her on the disability-discrimination claims or on retaliation under the federal law.

The opinion resolved issues remaining after the trial: Ottoson’s request for attorney’s fees and costs, former attorney Corey Stark’s request for a charging lien and additional fees, and SMBC Leasing and Finance, Inc. and Lisa Saviñon’s request for sanctions based on Ottoson’s destruction or withholding of evidence. The opinion also entered the dispositions required by the jury verdict, including the claims against David Ward.

Attorney’s Fees and Costs for Ottoson

Because Ottoson prevailed on her New York City retaliation claim, the court treated her as a prevailing party eligible for a discretionary fee award. She sought $25,333.75, consisting of payments to former attorneys Jesse Rose and Corey Stark and litigation expenses.

The court refused to award the fees paid to Rose because the claims on which he worked primarily concerned disability discrimination, on which Ottoson did not prevail. The court determined that 60 percent of Stark’s work related to the retaliation claims and awarded Ottoson $6,300, representing 60 percent of the $10,500 she had paid him. The court awarded all requested expenses and costs, totaling $7,033.75, because they could not be easily separated between the successful and unsuccessful claims.

Stark’s Charging Lien and Fee Request

A charging lien is a claim by a lawyer against a client’s recovery for the reasonable value of the lawyer’s services. Stark had already received $10,500 from Ottoson under a contingent-fee arrangement. The court concluded that giving him an additional share of Ottoson’s recovery would not be fair or reasonable.

The court also held that a prevailing party, rather than the party’s lawyer, has the right to seek attorney’s fees. Because Ottoson did not owe Stark additional fees beyond what she had paid under the contingent-fee arrangement, the court denied Stark’s request for fees and vacated his charging lien.

Sanctions for Evidence Spoliation

Evidence spoliation means destroying, withholding, or failing to preserve evidence. In an earlier ruling in this case, Judge Robert W. Sweet found that Ottoson had acted willfully, in bad faith, or at least with gross negligence, and ordered an instruction allowing the jury to draw an unfavorable inference from the missing evidence. The current court declined to revisit that ruling.

The defendants requested $95,878.76 for their motion to compel and sanctions motion, $75,059.80 for recovering the missing evidence, and $1,853.39 in related costs. The court found the requested billing rates and hours reasonable. It also concluded that Rule 37 of the Federal Rules of Civil Procedure generally required an award for the expenses caused by the evidence dispute, even if the conduct had not been intentional.

The court considered Ottoson’s self-represented status, her asserted limited income, and the fact that a large sanctions award would exceed her trial recovery. It nevertheless found that the conduct was serious, including willful evidence spoliation and repeated false statements, and that an award was warranted for punishment, deterrence, and compensation. The court reduced the requested amount and awarded the defendants $60,000 in attorney’s fees and costs.

The court also granted the defendants’ motion to seal redacted billing records because they contained attorney work product and confidential attorney-client communications.

Judgment and Disposition

The court stated that Ottoson was entitled to $21,250 from SMBC and Lisa Saviñon under the New York City Human Rights Law, plus $16,427.40 in prejudgment interest, for a liability award of $37,677.40. Adding her $13,333.75 fee-and-cost award produced a total recovery of $51,011.15. The court stated that all claims against David Ward were dismissed pursuant to the jury verdict.

The court offset Ottoson’s $51,011.15 recovery against the defendants’ $60,000 sanctions award. It directed the Clerk to enter judgment for the defendants and against Ottoson in the net amount of $8,988.85, close the motions, and close the case.