Opinion
X03HHDCV126030610S
09-18-2017
Diamond 67, LLC v. Derek V. Oatis et al
UNPUBLISHED OPINION
MEMORANDUM OF DECISION
Ingrid L. Moll, Judge
This matter, sounding in common law and statutory vexatious litigation, arises out of the plaintiff Diamond 67, LLC's (Diamond) efforts to develop a Home Depot store off of Exit 67 of Route 84 in Vernon, and the defendants' intervention efforts to challenge the proposed development on environmental grounds pursuant to General Statutes § 22a-19. Following a hybrid jury and bench trial, and for the reasons stated below, the court enters judgment in favor of defendants Derek V. Oatis (Oatis), Lobo & Associates, LLC (Lobo & Associates), Ann Letendre (Letendre), and John (a/k/a Jack) Summers (Summers).
General Statutes (Rev. to 2003) § 22a-19(a) provides in relevant part: " In any administrative . . . proceeding . . . any person . . . or other legal entity may intervene as a party on the filing of a verified pleading asserting that the proceeding or action for judicial review involves conduct which has, or which is reasonably likely to have, the effect of unreasonably polluting, impairing or destroying the public trust in the air, water or other natural resources of the state."
At the commencement of trial, the defendants were Oatis, Lobo & Associates, Letendre, and Summers, as well as Glenn Montigny (Montigny), Debra Wilson (Wilson), Amy Blaymore-Paterson (Paterson), and James David Batchelder (Batchelder). For ease of reference, the court will refer to this group of eight as the " original defendants." Over the course of the trial, Diamond settled its claims with Batchelder, Montigny, Paterson, and Wilson. Accordingly, the court will refer to Oatis, Lobo & Associates, Summers, and Letendre as the " defendants" or " remaining defendants."
Diamond filed formal withdrawals, and the withdrawal of such claims was noted on the record on March 30, 2017.
Diamond claims that the defendants' intervention efforts in the following proceedings were vexatious: (1) Diamond 67, LLC v. Planning and Zoning Commission of the Town of Vernon, Docket No. TTD-CV07-4007520S, Superior Court, judicial district of Tolland at Rockville (referred to herein as the " mandamus action"); and (2) Diamond 67, LLC v. Planning & Zoning Commission of the Town of Vernon, Docket No. CV07-4007637-S, judicial district of Tolland at Rockville (referred to herein as the " administrative appeal"). For ease of reference, the court will refer to the mandamus action and the administrative appeal collectively as the " Underlying Proceedings."
I
Procedural History
The court begins with a summary of the relevant procedural history of the instant action. The operative complaint is Diamond's third amended complaint dated January 30, 2013, which sets forth the following counts as to the remaining defendants: (1) count one--common-law vexatious litigation, as to Oatis and Lobo & Associates; (2) count two--statutory vexatious litigation under General Statutes § 52-568 (double damages), as to Oatis and Lobo & Associates; (3) count three--statutory vexatious litigation under § 52-568 (treble damages), as to Oatis and Lobo & Associates; (4) count four--common-law vexatious litigation, as to Oatis and Lobo & Associates; (5) count five--statutory vexatious litigation under § 52-568 (double damages), as to Oatis and Lobo & Associates; (6) count six--statutory vexatious litigation under § 52-568 (treble damages), as to Oatis and Lobo & Associates; (7) count twenty-five--common-law vexatious litigation, as to Letendre; (8) count twenty-six statutory vexatious litigation under § 52-568 (double damages), as to Letendre; (9) count twenty-seven--statutory vexatious litigation under § 52-568 (treble damages), as to Letendre; (10) count twenty-eight--common-law vexatious litigation, as to Letendre; (11) count twenty-nine--statutory vexatious litigation under § 52-568 (double damages), as to Letendre; (12) count thirty--statutory vexatious litigation under § 52-568 (treble damages), as to Letendre; (13) count thirty-one--common-law vexatious litigation, as to Summers; (14) count thirty-two--statutory vexatious litigation under § 52-568 (double damages), as to Summers; (15) count thirty-three--statutory vexatious litigation under § 52-568 (treble damages), as to Summers; (16) count thirty-four--common-law vexatious litigation, as to Summers; (17) count thirty-five--statutory vexatious litigation under § 52-568 (double damages), as to Summers; and (18) count thirty-six--statutory vexatious litigation under § 52-568 (treble damages), as to Summers. On March 5, 2013, Letendre filed an answer and special defenses, asserting the Noerr-Pennington doctrine, statute of limitations, and advice of counsel. (#157.00.) On March 6, 2013, Summers filed an answer and special defenses, asserting the Noerr-Pennington doctrine, immunity from suit under article first, § 14, of the Connecticut constitution, and advice of counsel.
On February 24, 2015, the trial court, Miller, J., granted all of the original defendants' motions for summary judgment on the ground that there was no evidence to suggest that Home Depot abandoned the development at issue based on any of the original defendants' conduct. Diamond 67, LLC v. Oatis, 167 Conn.App. 659, 673-74, 144 A.3d 1055 (2016). Diamond appealed from that decision. On appeal, the Appellate Court concluded that " summary judgment was improperly granted, and decline[d] to affirm the court's judgment on any of the alternative grounds proposed by the defendants." Id. at 662. The Court issued the following mandate: " The judgment is reversed and the case is remanded with direction to deny the defendants' motions for summary judgment and for further proceedings according to law." Id. at 691. Such summary judgment motions were subsequently denied.
On December 6, 2016, Letendre filed an amended answer and special defenses, asserting the Noerr-Pennington doctrine, statute of limitations, advice of counsel, and immunity from suit under article first, § 14, of the Connecticut Constitution. On January 27, 2017, Oatis and Lobo & Associates filed an amended answer and special defenses, asserting the Noerr-Pennington doctrine. Thereafter, in resolving various motions in limine, this court issued a decision regarding the scope of the Appellate Court's remand (#273.86), and the matter proceeded toward trial.
Letendre did not pursue this special defense at trial.
A jury trial, which simultaneously served as a trial to the court on certain issues, took place over five weeks from March 1, 2017 through April 4, 2017. On March 30, 2017, Diamond withdrew its common law vexatious litigation claims, as well as its statutory vexatious litigation claims for treble damages, against Letendre and Summers (i.e., counts twenty-five, twenty-seven, twenty-eight, thirty, thirty-one, thirty-three, thirty-four, and thirty-six), leaving against them only the statutory vexatious litigation claims for double damages in counts twenty-six and twenty-nine as to Letendre and counts thirty-two and thirty-five as to Summers.
Prior to the parties' closing arguments, and in light of the unusual nature of a vexatious litigation claim tried to a jury, counsel for Diamond and counsel for the remaining defendants, with the input and approval of the court, agreed to the manner in which the elements of the causes of action and/or special defenses would be divided between the jury and the court for determination. The jury would decide: (1) whether the participation in the Underlying Proceedings by Oatis, Lobo & Associates, Letendre, and/or Summers caused the Home Depot project in Vernon not to go forward (and if so, what was the resulting financial loss to Diamond); (2) whether Letendre and Summers had proven their special defenses of good faith reliance on advice of counsel; (3) whether Oatis, in connection with his conduct in the Underlying Proceedings, acted with a malicious intent unjustly to vex and trouble Diamond; and (4) in the event of a malice finding as to Oatis, whether Oatis's conduct in the Underlying Proceedings reflected a reckless indifference to the rights of Diamond or an intentional and wanton violation of those rights (and if so, what were the resulting reasonable attorneys fees and reasonably necessary disbursements incurred by Diamond in the present litigation) (i.e., a question directed to punitive damages, see DeLaurentis v. City of New Haven, 220 Conn. 225, 269-70, 597 A.2d 807 (1991)). The court would decide: (1) probable cause and all underlying facts; and (2) the Noerr Pennington defense. The parties agreed that the jury interrogatory responses would be accepted prior to the court rendering its decision on the foregoing issues.
The jury instructions made clear that the court would decide the issue of liability, if any, of the defendants and that the court had not yet made any findings.
On April 4, 2017, the jury provided its responses to the jury interrogatories, finding in favor of the defendants on the issues of: (1) causation regarding the Home Depot project not going forward; (2) the advice of counsel defense as to Letendre and Summers; and (3) the malice element as to Oatis. On April 10, 2017, the court held a post-trial hearing for the purpose of having a dialogue with counsel as to what remained pending for the court's consideration in light of the jury interrogatory responses, taking into account any mootness concerns. Counsel agreed that the court would still decide (1) probable cause (i.e., liability for statutory vexatious litigation under § 52-568), (2) whether the Noerr-Pennington defense applies, and (3) statutory damages, if any. On May 5, 2017, the parties submitted post-trial briefs.
Specifically, the jury interrogatory responses provide as follows:
1. Do you find that the participation in the Underlying Proceedings by any of the following defendants caused the Home Depot project in Vernon not to go forward? a. As to Derek Oatis and Lobo & Associates: YES NOx b. As to Ann Letendre: YES NOx c. As to John Summers: YES NOx (If you answered " YES" to any of the above, answer Question #2. If you answered " NO" to all of the above, skip Question #2 and proceed to Question #3.) 2. Only if you answered " yes" to Question #1, answer the following question. What amount of financial loss do you find Diamond 67 suffered as a result of the Home Depot project in Vernon not going forward? $ 3. Do you find that Ann Letendre has proven the special defense of good faith reliance on advice of counsel? YESx NO 4. Do you find that John Summers has proven the special defense of good faith reliance on advice of counsel? YESx NO 5. Do you find that Attorney Oatis, in connection with his conduct in the Underlying Proceedings, acted with a malicious intent unjustly to vex and trouble Diamond 67? YES NOx (If " YES, " answer Question #6 and follow related instructions. If " NO, " skip Questions ##6 and 7.) 6. Do you find that Attorney Oatis's conduct in the Underlying Proceedings reflected a reckless indifference to the rights of Diamond 67 or an intentional and wanton violation of those rights? YES NO (If " YES, " answer Question #7. If " NO, " skip Question #7.) 7. Only if you answered " yes" to Question #6, answer the following question. What amount of reasonable attorneys fees and reasonably necessary disbursements do you find Diamond 67 to have incurred in the present litigation? $ 4/4/17Date /s/ Jury Foreperson
Having considered the evidence and arguments of counsel with respect to the issues reserved for the court, and applying the jury's interrogatory responses where appropriate, the court renders this decision and orders that judgment enter: (1) in favor of Oatis and Lobo & Associates with respect to counts one through six; (2) in favor of Letendre with respect to counts twenty-six and twenty-nine; and (3) in favor of Summers with respect to counts thirty-two and thirty-five.
II
Findings of Fact
The plaintiff is Diamond. The subject property is a 14.7-acre parcel known as 117 Reservoir Road in Vernon, located off of Exit 67 on Route 84. Diamond purchased the subject property in January 2006, conveyed it to Home Depot U.S.A., Inc. (Home Depot) in March 2006 for $4 million, and retained an option to purchase it back on or before March 9, 2011. On or about March 9, 2006, Diamond entered into a written agreement with Home Depot, entitled " Real Property Sale-Leaseback Agreement." There was a 30-year ground lease (with options to extend thereafter) attached to the agreement, which Home Depot would have entered had the necessary approvals for the development been secured, whereby Diamond as the owner of the property would lease the property to Home Depot as the tenant. The plaintiff had four years under the Home Depot contract to secure the approvals, i.e., March 9, 2010.
Defendants Summers, Montigny, Batchelder, Wilson, and Letendre are individual citizens who informally joined together to form a non-legal entity called Smart Growth for Vernon (SGV), the purpose of which was to oppose the proposed Home Depot development. It appears they were the only members. At all times relating to the Underlying Proceedings, they were represented by defendant Derek Oatis, an attorney employed by the law firm of Lobo & Associates.
On February 20, 2003, Diamond applied with the Vernon inland wetlands commission (wetlands commission) for an inland wetlands permit for the proposed Home Depot project on the subject property (wetlands application). Almost immediately thereafter, on March 3, 2003. Diamond filed an application for site plan and special permit approval with the zoning commission (2003 application). In August 2003, the wetlands commission denied the wetlands application. Diamond appealed from that denial to the Superior Court, and the appeal was tried to the court on November 24, 2004, before the Honorable Jane Scholl. Diamond 67, LLC v. Inland Wetlands Commission, Superior Court, judicial district of Tolland, Docket No. CV03-0082411S, . On March 18, 2005, the court, Scholl, J., remanded the wetlands application to the wetlands commission after determining that the " commission . . . both failed to find an adverse impact and failed to provide the court with a basis upon which to search the record for substantial evidence of such an impact." After several special meetings, on December 7, 2005, the wetlands commission again denied the wetlands application, finding that the proposed project would result in an adverse impact to the wetlands. Diamond and Home Depot filed an appeal therefrom to the Superior Court. Diamond 67, LLC et al. v. Vernon Inland Wetlands Commission, Superior Court, judicial district of Tolland, Docket No. CV06-4004144S, . Letendre, as well as Warren and Audrey Clay, were parties to the appeal pursuant to § 22a-19. On March 8, 2007, the appeal was tried to the court, Klaczak, J.T.R.
On May 10, 2007, the court, Klaczak, J.T.R., issued its decision sustaining the appeal (Judge Klaczak's wetlands decision). Judge Klaczak found in part:
[E]ven if the commission did have jurisdiction to consider the potential impacts of the septic system, the court's review of the record fails to disclose substantial evidence indicating that the operation of the septic system would adversely impact wetlands or watercourses. Although Henry Luce, a soil scientist, and Jane Seymour, a wildlife biologist, expressed concerns relating to the effluent typically discharged by a septic system, neither of these individuals opined that the plaintiffs' particular proposed septic system would adversely impact the wetlands or watercourses . . . " Evidence of general environmental impacts, mere speculation, or general concerns do not qualify as substantial evidence." River Bend Associates, Inc. v. Conservation & Inland Wetlands Commission, supra, 269 Conn. at 71.(Mem. of Dec. at 18 n.15.) Judge Klaczak wrote further, in part:
Under the Inland Wetlands Act " [t]he sine qua non of review of inland wetlands applications is a determination whether the proposed activity will cause an adverse impact to a wetland or watercourse." (Emphasis in original.) River Bend Associates, Inc. v. Conservation & Inland Wetlands Commission, supra, 269 Conn. at 74; see also AvalonBay Communities, Inc. v. Inland Wetlands Commission, supra, 266 Conn. at 163. " [E]xpert testimony may be required when the question involved goes beyond the ordinary knowledge and experience of the trier of fact." (Internal quotation marks omitted.) Feinson v. Conservation Commission, 180 Conn. 421, 428, 429 A.2d 910 (1980). It is well established that " [d]etermining what constitutes an adverse impact on a wetland is a technically complex issue." River Bend Associates v. Conservation & Inland Wetlands Commission, supra, 78.
The substantial evidence test requires a substantial basis in fact that an adverse impact to the wetlands or watercourses will result from the proposed activities and that the commission's decision must be supported by more than a possibility of that adverse impact . . . " Evidence of general environmental impacts, mere speculation, or general concerns do not qualify as substantial evidence." [ River Bend Associates, Inc. v. Conservation & Inland Wetlands Commission, 269 Conn.] at 71 . . . The expert must specify with particularity the precise harm that will result. [Internal quotation marks omitted.] . . . Thus, in the absence of countervailing expert testimony, where the commissioners themselves do not possess relevant technical expertise, a commission may not draw inferences which undermine an expert's site specific opinion . . .(Citations omitted.) (Mem. of Dec. at 20-22.) The court went on to find that
neither Seymour nor Letendre's testimony evidences a substantial basis in fact supporting the commission's finding of an adverse impact to the surrounding wetlands and watercourses. The commission cannot have relied upon the studies submitted by Letendre, as such material was not site specific as it did not take into account the closed nature of the plaintiffs' stormwater management system, and, as such, did not establish that any specific harm to the wetlands would occur as a result of the proposed regulated activity . . . As the testimony of both Seymour and Letendre was not site specific, this testimony was not probative as to whether the plaintiffs' particular proposed activities would adversely affect the wetlands or watercourses.(Id. at 25-26.) The court further found:
[A] review of the record fails to reveal any site specific evidence concluding that any adverse impact would result from potential increased traffic on Reservoir Road. Similarly, the record also lacks site specific expert testimony indicating that heated runoff from the site's impervious surfaces would adversely impact wetlands or watercourses.(Id. at 31.) The court sustained the appeal and reversed the wetlands commission's denial of the inland wetlands permit and remanded to the commission for further consideration of any conditions that should be attached to the issuance of the permit as supported by evidence in the record. (Id. at 34.) The wetlands commission subsequently issued a permit to Diamond. No appeal was taken from Judge Klaczak's wetlands decision, and the time to take such appeal passed by the time Oatis became involved in representing SGV. On May 15, 2007, Attorney Paterson, who represented that the inland wetlands intervenors, indicated to the SGV members that she was " incredibly disappointed" by Judge Klaczak's wetlands decision and indicated that the " fight needs to move to PZC [the zoning commission]."
On or about May 29, 2007, Diamond filed with the zoning commission a new application for approval of a revised site plan and related permits (2007 application). On June 4, 2007, Letendre was of the view that " [i]f we're going to spend any $$, it should be for a TRAFFIC EXPERT. We need to do this pronto. HD is already starting the traffic counts . . ." (Approximately three months later, Summers retained a traffic expert, DLS Traffic Engineering, but later " put the study on hold.") On June 6, 2007, Summers asked Paterson if she could meet with SGV to discuss a general strategy and hiring experts to present to the zoning commission. On June 11, 2007, Paterson spoke with Marc Goodin, a civil engineer, about assisting with the " Home Depot opposition"; Goodin estimated it would cost around $8,000 to get through the first public hearing and $20,000-$40,000 for several zoning commission meetings. Paterson conveyed this information to Summers and also indicated to him that " [y]ou still need to consider hiring a traffic engineer as well." Around this time in 2007, Attorney Paterson recommended to SGV that they seek representation by Oatis in connection with the Home Depot opposition because she was discontinuing the practice of law.
On or about June 27, 2007, while its 2007 application was still pending, Diamond sent the zoning commission a demand letter: (1) stating that, because the commission did not act on Diamond's 2003 application within the statutory time frame, it was deemed approved under General Statutes § § 8-3(g) and 8-7d; and (2) making demand on the commission to issue an approval of plan of development and special permits by July 9, 2007. When the zoning commission did not do so, on or about July 9, 2007, Diamond filed a mandamus action against the zoning commission seeking a writ of mandamus directing the commission to issue a certificate of approval of the 2003 application based on the automatic approval doctrine (mandamus action). See Diamond 67, LLC v. Planning and Zoning Commission of the Town of Vernon, Docket No. TTD-CV07-4007520S, Superior Court, judicial district of Tolland at Rockville.
Not yet aware of the mandamus action, on July 10, 2007, Summers, Batchelder, Montigny, Paterson (and perhaps Wilson and Letendre by telephone) met with Oatis for about two hours regarding Oatis taking over the representation of SGV regarding the opposition to the Home Depot project. His role was to assist SGV with experts to give a presentation before the zoning commission and build upon what Paterson had previously presented to the wetlands commission. During that initial conference, Oatis and the SGV members in attendance discussed the need to hire environmental experts in order to make a presentation before the zoning commission. Summers was willing to pay for such experts. Oatis stated that he knew a hydrogeologist at Eastern Connecticut State University, who would likely be able to assist SGV for a very reasonable fee; Oatis also stated that a civil engineer and a traffic engineer would have to be hired. Summers discussed with Oatis the Vernon Plan of Conservation & Development dated June 2001 (plan of conservation) (which he understood to be a guide for the town) and his knowledge regarding the environment surrounding 117 Reservoir Road. Oatis would later rely on the plan of conservation, which reflects numerous themes, including that the water quality of Vernon's lakes, rivers, and groundwater should be protected. The plan of conservation explains that Walker Reservoir, which serves as the headwaters for the Tankerhoosen River, is not an active public water supply reservoir but is a popular year-round recreational area for hiking, fishing, and ice skating. On or about July 16, 2007, Summers sent a check in the amount of $5,000 to Lobo & Associates " to cover any retainer fees for studies for opposition to the proposed Home Depot at 117 Reservoir Road in Vernon." Oatis received such funds and stated that they would " be placed in escrow with the priority of retaining and paying expert witnesses."
Prior to the July 10 meeting, Oatis met with Paterson, who walked Oatis through Judge Klaczak's wetlands decision. At some point, Oatis reviewed Paterson's file relating to the wetlands proceedings.
On July 19, 2007, the zoning commission denied the 2003 application. On July 31, 2007, Diamond took an administrative appeal from that denial to the Superior Court (administrative appeal). Diamond 67, LLC v. Planning & Zoning Commission of the Town of Vernon, Docket No. CV07-4007637-S, judicial district of Tolland at Rockville.
On August 1, 2007, because Smart Growth was not a legal entity, Summers executed a retainer agreement between Lobo & Associates, and " Smart Growth for Vernon/Jack Summers." The scope of the representation is described as relating to " Smart Growth for Vernon v. The Home Depot (Zoning Matter) ('Case') and any matters relating to or arising out of the Case. This agreement does not cover any appeal." Under the agreement, Summers guaranteed payment for any amounts due thereunder. For several years, Summers received and paid bills from Lobo & Associates through Oatis, amounting to about $33,000, through at least April 2011. Oatis understood Summers to be the final decision-maker for SGV, and the record supports a finding that he was. Oatis had no written agreement regarding decision-making among the SGV members, and there was no written agreement among the SGV members as to who would be in control of the litigation. On August 9, 2007, Oatis wrote to Summers that he would not take any fees out of the $5,000 retainer " until we know where we stand in retaining the experts we need." Summers and Oatis had discussed by this time the need to hire experts.
By August 9, 2007, Oatis recommended filing intervention petitions on behalf of the group and at least one individual. Also by August 9, 2007, Oatis had reached out to Catherine Carlson, a hydrogeologist. Oatis and Carlson had at least a few telephone conversations, and Oatis sent her various relevant materials for her review. However, Carlson was never retained as an expert, and she never provided a written opinion regarding the Home Depot matter. On August 17, 2007, Summers inquired with Batchelder, Wilson, and Montigny regarding who would be the intervenor. Summers was reluctant to be the intervenor because he lived in Tolland. Montigny was willing to be the intervenor, at least in part because he lived the closest to the subject property, but he did not want to have any financial responsibility relating to the intervention.
In late June 2007, and again in August 2007, Montigny, Summers, Batchelder, and Wilson, on behalf of SGV, discussed sending letters to local businesses to solicit funds from the public to support SGV's efforts. On June 29, 2007, a letter was signed by Montigny and Batchelder. The letter provided in part:
Home Depot has been trying to get into the Vernon area at Exit 67 since 2003 and previous to that at Exit 66. Due to the diligence and hard work of many residents in the region and Vernon's award-winning Inland Wetlands Commission (IWC), Home Depot had been successfully held at bay.
Due to the recent reversal of the denial of Home Depot's application at Exit 67 by a Superior Court judge on May 10, 2007, Home Depot is again a threat, not only to the fragile eco system at the headwaters of the Tankerhoosen, including Walker's Reservoir, but also to area merchants . . .
. . . We have raised funds to pay for needed expenses such as services of a land use attorney, traffic study, and experts necessary to prove that Home Depot does not belong at Exit 67.
. . . Home Depot in this area would financially affect many local businesses in Vernon and surrounding towns. We are fighting to keep our communities run by our citizens because we believe that family-owned businesses are the core and strength of our communities (smart growth).
WE NEED YOUR HELP. Home Depot filed an application with the Vernon Planning and Zoning Commission on June 7, 2007 . . .
The purpose of the solicitation was to help pay for legal representation and experts. Batchelder was responsible for receiving any funds received from the campaign. A second, similar solicitation letter, of which Summers approved, was sent shortly thereafter, to local small business owners. It stated, among other things, that " [h]iring a lawyer, miscellaneous legal fees and costs, hiring a hydrologist and engineer, funding an independent traffic study, etc. are the things needed to adequately fight this development . . . For those businesses who have not contacted us and are hesitant about donating, please take a moment to calculate the amount . . . your business will suffer with a new Home Depot at Exit 67. Calculate the fair market value of your family-owned business now and after a new Home Depot is built within a 5-mile radius of your store. We need your support to wage a successful fight." Less than $1,000 was raised from the solicitation efforts. In connection therewith, an SGV bank account was opened; Batchelder served as treasurer for SGV.
On or about August 26, 2007, Oatis informed Summers that Carlson would be able to help with the Home Depot opposition, but that Goodin (suggested by Paterson) had a conflict and could not get involved. Summers wrote at such time, in connection with the upcoming zoning commission meeting on September 6, 2007: " I think we need to be better prepared." That same day, Paterson emailed Summers: " I really think you need an engineer to evaluate the storm water management system. Unfortunately, it is very difficult to find engineers that are willing to undertake oppositions. Mark Goodin is one of the few that will. Jane Seymour told me about someone at UCONN that might help. I'll try and get his name." On August 27, 2007, Oatis told Summers that SGV did not need to have all expert studies ready by September 6 and that Carlson's study would be sufficient. However, there was no such study for the September 6 meeting, and Carlson was never asked to prepare such a study. In any event, at some point prior to September 6, Oatis learned that the Home Depot project would not be on the zoning commission meeting agenda. Oatis also advised Summers that he thought an economic study would not be very persuasive and that it would be better, although difficult and expensive, to find another civil engineer. No expert was ever hired to analyze the storm water system, nor was any third party contacted to perform an economic study.
By the end of August 2007, Oatis learned of Diamond's mandamus action. On September 21, 2007, Oatis, on behalf of Montigny, filed a petition to intervene into the mandamus action as a party defendant, pursuant to § 22a-19 (mandamus petition). To prepare the substantive allegations of the mandamus petition, Oatis utilized information from Paterson's file, Jane Seymour's wildlife report, Dr. Harvey Luce's report, Letendre's materials submitted to the IWC, " other DEP reports, " portions of the plan of conservation, zoning regulations, and a Fuss & O'Neil report. Oatis otherwise drew from his conversations with the SGV members but could not identify what facts were given to him by Batchelder, Letendre, Montigny, Summers, or Wilson. Oatis did not receive any additional materials from Letendre or Seymour.
The docket sheet for the administrative appeal reflects that Oatis filed a petition to intervene in the administrative appeal on that same day. The court has scoured the record for an as-filed copy of that petition but found none. The record was insufficient to conclude that the version admitted as Plaintiff's Exhibit 19 was the filed version. It bears no case caption, it does not reflect any court file stamp, and Oatis testified that it was rejected for filing.
Montigny's mandamus petition made, among others, the following representations:
(p. SUMMERS 00227) " The proposed site of the [missing phrase] is located approximately 300 feet from the Walker Reservoir East, a source of public water and likely served by the watershed underlying the proposed Development site . . . [T]he proposed Development site sits upon an aquifer crucial to the ground water system supply booth [sic] the Walker Reservoir East and the Tankerhoosen Watershed, which includes Walker's Reservoirs, Gage's Brook and the Tankerhoosen River." (Emphasis added.)
(p. SUMMERS 00227) " The current condition of the proposed development site provides an excellent source of water infiltration and natural filtering which helps ensure an excellent contribution of ground water to the Tankerhoosen Watershed and the maintenance of the quality of the public water supply as well as a critical source of up-stream supply to crucial and sensitive wildlife habitats." (Emphasis added.)
(p. SUMMERS 00228) " [T]hese watercourses and related aquifers are crucial to not only the public water supply but also to pollution intolerant invertebrates and the Belding Wild Trout Management Area." (Emphasis added.)
(pp. SUMMERS 00230-00231) " The conduct proposed by the Plaintiff, in both the construction of the Development and the subsequent operation of the Home Depot and Garden Center is unreasonably likely to result in the unreasonable disruption, pollution, impairment and destruction of the natural resources and hydrology of the immediate area, including but not limited to those natural resources described above. Said reasonably likely disruption, pollution, impairment and destruction may include, but is not limited to:
a. Alteration of existing service [sic] and/or water ground flow supplying the Tankerhoosen Watershed caused by the disturbance of the existing site soil and the tremendous addition to impermeable service [sic] and the destruction of the existing natural groundwater filtering sources;
b. Pollution of surface and/or ground water including, but not limited to Tankerhoosen Watershed, the Tankerhoosen River, Gage's Brook, and the Walker's Reservoir, a source of drinking water for the citizens of Connecticut and a crucial source of clean water for numerous species of wildlife, through discharge and/or runoff;
c. Inadequate disposition of organic and/or hazardous waste material that are therefore allowed to contaminate, degrade, pollute and impair the Tankerhoosen Watershed, the Tankerhoosen River, Gage's Brook, and the Walker's Reservoir, a source of drinking water for the citizens of Connecticut. These contaminates, exacerbated by the tremendous increase in impervious surface cover, include but are not limited to road sand, erosion, thermal impacts, and a significant and detrimental increase in the amount of heavy metals, including nickel, chromium, lead copper, zinc and manganese entering the water supply and stream; d. Increase in noise and traffic and the inevitable resulting increase in petroleum contamination, metals and other contamination caused by increased vehicular use;
e. Destruction of vegetation and/or wildlife and/or disruption of existing natural migratory and travel patterns of wildlife to which the surrounding protected spaces, existing area, and Tankerhoosen Watershed provides essential habitat.(Emphasis added.) The mandamus petition contains a verification signed and sworn to by Montigny in Oatis's presence. The verification provides:
(p. SUMMERS 00232) The aforementioned proposed conduct by the Plaintiff is unreasonably likely to cause unreasonable pollution, impairment or destruction of the Tankerhoosen Watershed, the Tankerhoosen River, Gage's Brook, and the Walker's Reservoir, a source of water for the citizens of Connecticut and the surrounding ecosystem, it's [sic] vegetation and wildlife which rely upon the integrity of this area a necessary habitat and a source supply of up-steam [sic] water.
Oatis testified at trial that the missing phrase was " septic system."
The phrase " unreasonably likely to cause unreasonable pollution, " too, is an error. Section 22a-19(a) utilizes the phrase: " reasonably likely to have, the effect of unreasonably polluting, impairing or destroying." (Emphasis added.)
At the time Montigny signed this petition, prior to his taking the oath, he told Oatis he was uncertain as to whether Walker Reservoir was a source of public drinking water. Oatis claims that he then removed some, but inadvertently not all, references to Walker Reservoir as a source of public drinking water. The plan of conservation expressly states: " Walker Reservoir, located just south of 84 along the Tolland Town line, is not an active public water supply reservoir." Montigny also questioned the references to " source of public water supply " (as opposed to source of public water), and Oatis committed to amending those references later if he found that there was a significant distinction between the phrases. No amendments followed. This language would become an issue two years later.
On September 27, 2007, Summers wrote to Montigny, Wilson, and Batchelder: " Since the battle has moved from PZC to the court system, we will need money mainly for lawyers. We may need to fund a hydrologist, since we can fight on environmental grounds. We will not need more money for a traffic engineer." Oatis had recommended putting the traffic study on hold, and such study was never requested to be resumed.
On October 17, 2007, the court, Sferrazza, J., granted Montigny's petition to intervene into the administrative appeal but denied Montigny's mandamus petition. On October 19, 2007, Oatis wrote to Paterson and Summers of his concern that Home Depot and the zoning commission would explore a settlement in the mandamus action without their involvement: " I am extremely concerned that this 'wrangling' by the Town and Home [D]epot will deprive us of a forum to raise our concerns."
By November 2007, Diamond, Home Depot, and the zoning commission (represented by three members of the commission) were engaged in mediation and settlement discussions and eventually reached a proposed agreement on a new site plan, which was different from the 2003 and 2007 applications (settlement plan). Oatis was precluded from participating in such discussions on behalf of Montigny or SGV. The changes contained within the settlement plan include, but are not necessarily limited to, the following: (1) the construction of a sewer line; and (2) a reduction in the size of the building and the impervious surface. On November 19, 2007 (and, it appears, three other dates), the zoning commission held a " special meeting" for the purpose of presenting the settlement plan to the public (special meeting). Prior to the special meeting, Oatis was unable to obtain a copy of the settlement plan. Although the public was permitted to speak, the meeting was not a " public hearing" during which the public could present evidence. That same day, Oatis had filed, on behalf of Montigny and Batchelder, motions to intervene into the special meeting. The zoning commission denied those motions.
Oatis and Lobo & Associates incorrectly argued during the argument on the motions for directed verdict that counts four through six were based on Montigny's and Batchelder's petitions to intervene in the November 19, 2007 special meeting. Oatis and Lobo & Associates appear to have caught the error, however, as they acknowledge on page 4 of their post-trial brief that Diamond " has not alleged that the filing of this administrative appeal [referencing No. TTD-CV07-4008384] constituted vexatious litigation . . ." Relatedly, Diamond argues on pages 19-20 of its post-trial brief that Montigny and Batchelder improperly sought to intervene in the zoning commission's special meeting and appealed from the denial therefrom to the Superior Court. But, again, that administrative appeal was given docket number TTD-CV07-4008384. Diamond's third amended complaint does not allege that such proceedings were vexatious. Batchelder and Montigny appealed from those decisions to the Superior Court. Batchelder v. Town of Vernon, No. TTD-CV07-4008384-S, judicial district of Tolland at Rockville. On June 10, 2010, the court, Sferrazza, J., granted PZC's motion for summary judgment as to Montigny on collateral estoppel grounds and dismissed Batchelder's appeal as moot. In January 2012, the Appellate Court dismissed Batchelder and Montigny's subsequent appeal as moot. Batchelder v. Planning & Zoning Commission of Town of Vernon, 133 Conn.App. 173, 174-75, 34 A.3d 465 (2012). The litigation continued until March 2012, when the Supreme Court denied Batchelder and Montigny's petition for certification. The petitions to intervene into the special meeting and the administrative appeal that followed do not form the basis of any of Diamond's claims.
On November 20, 2007, Oatis wrote to SGV that if intervention were allowed in the mandamus action, he would " need to be ready with experts to testify at [a] court hearing or before the PZC if the Court sends it back to them." (Emphasis added.) On December 3, 2007, Letendre shared her view with Oatis, Paterson, Montigny, Summers, Wilson, and Batchelder that " frankly, the environmental arguments are going to be tough to make, given our regulations."
On December 20, 2007, the zoning commission voted 4-3 to approve the settlement plan. On January 15, 2008, Oatis wrote: " While we probably have other means top [sic] attack this new plan that would allow fro [sic] a longer delay (and therefore a longer period of time before this new 'settlement' plan bites the dust and HD has to do a new application, I'm not sure I would be comfortable NOT filing a renewed petition to intervene in the mandamus." On February 7, 2008, Diamond, Home Depot, and the zoning commission entered into a settlement agreement (February 7, 2008 settlement or settlement agreement), which incorporated the settlement plan. The settlement agreement expressly stated that the agreement would resolve the mandamus action if approved by the court. On February 11, 2008, Diamond filed a motion for the court to approve the settlement agreement. Home Depot and the zoning commission joined in that motion. On February 13, 2008, Montigny filed a renewed motion to intervene in the mandamus action (renewed mandamus petition), to which Diamond objected. On February 14, 2008, a hearing--that did not comply with General Statutes § 8-8(n) --took place on Diamond's motion for judgment in accordance with the settlement agreement. The court, Sferrazza, J., denied Montigny's renewed mandamus petition and rendered judgment in accordance with the February 7, 2008 settlement. Thereafter, Montigny appealed from the trial court's (1) denial of his renewed mandamus petition and (2) rendering judgment in accordance with the February 7, 2008 settlement.
General Statutes (Rev. to 2003) § 8-8(n) provides: " No appeal taken under subsection (b) of this section [by any person aggrieved by any decision of a board, including a decision to approve or deny a site plan] shall be withdrawn and no settlement between the parties to any such appeal shall be effective unless and until a hearing has been held before the Superior Court and such court has approved such proposed withdrawal or settlement."
In a unanimous decision officially released on September 15, 2009, the Appellate Court reversed the judgment of the trial court. Diamond 67, LLC v. Planning & Zoning Commission, 117 Conn.App. 72, 74, 978 A.2d 122 (2009) (Appellate Court's September 2009 decision). The Court concluded that, because the substance of the settlement would resolve both the mandamus action and the administrative appeal (into the latter of which Montigny had been granted intervention), the trial court improperly denied Montigny's mandamus petition. Id. at 84. Thus, the Court remanded the case " with direction to open the judgment that was rendered in accordance with the settlement and to grant Montigny's motion to intervene." Id. at 85. The Court further ordered that " before rendering judgment in accordance with a settlement between the plaintiffs and the defendant, the court must conduct a hearing compliant with § 8-8(n) to review the settlement, in which Montigny is entitled to participate for the purpose of raising environmental issues." (Emphasis added.) Id. In addition, the Court noted: " Our decision does not preclude the plaintiffs from continuing to seek a writ of mandamus in the Superior Court." Id. at 85 n.8.
Oatis received a copy of the slip opinion by September 8, 2009.
On September 15, 2009, Oatis discussed with Diamond's counsel, Attorneys Stanley Falkenstein and Robert Fuller, the latter two's view that the remand meant the case would return to the trial court for a § 8-8(n) hearing in the mandamus action where the issue would be whether the settlement could survive Montigny's environmental objections. Despite the express language of the Appellate Court opinion, Oatis maintained his view that he would press the notion that the mediation process in the mandamus action was " bogus" and that any mediation had to be conducted in the administrative appeal. Moreover, Oatis declined Falkenstein's suggestion to request a chambers conference with the court to " informally discuss these questions, " writing in part to his clients: " I do not want to educate them and discuss what I think the proper (meaning appeal proof) path for them to take is." The next day, September 16, 2009, Oatis wrote to Paterson in part:
This conversation alone undercuts Oatis's testimony at trial that he could not or would not have known until he appeared at court on October 21, 2009, whether Diamond, Home Depot, and the zoning commission intended to pursue approval of the settlement plan.
I hate to say this--but Stan Falkenstein may be right. The Appellate decision is less than clear. The Court seems to recognize that the parties are simply trying to settle the zoning appeal but then the Court orders remand and a hearing pursuant to 8-8(n). The Appellate Court appears not to have addressed my argument that the Parties cannot settle a mandamus action (at least unless it follows the same procedure as settlement of a zoning appeal).
I have a sinking feeling that the trial court will hold an 8-8(n) hearing and that it will then rule that we have no [sic] established our burden under CEPA . We will then be filing the same appeal and repeating our argument that, since the PZC only ahs [sic] powers granted by statute, that it cannot approve a site plan based upon the 'settlement' of a mandamus action. In this case, there was no mediator as required by statue [sic]. The more I look at it the bigger mess the Appellate Court decision becomes . . .(Emphasis added.)
On September 18, 2009, even Letendre asked Oatis: " Should we be thinking about hiring an environmental expert in the event--or at least have someone waiting in the wings--in case we do get to [a] hearing? I bring this up because it has been our experience that it is difficult to find someone who will represent the opposition[, ] and it's best to start the search early." Oatis did not respond. Although Oatis claimed at trial that Carlson was waiting in the wings, it is undisputed that, other than the aborted traffic study described above, neither Oatis nor any SGV member ever retained any expert, and no study was ever prepared to support the environmental claims asserted in Montigny's petitions to intervene into the Underlying Proceedings.
A hearing was scheduled for October 21, 2009 before Judge Klaczak for the purpose of determining whether the February 7, 2008 settlement would be approved. Although Oatis claimed (both at the time and at trial) that he had not received notice from the court regarding the October 21 hearing, it is beyond dispute that he was aware of the October 21 date by at least October 13, 2009, at which time he informed SGV of the hearing. Oatis claims that he learned of the hearing from one of the attorneys for Home Depot while in court on a related matter a couple weeks prior. Oatis did not inquire of the court, however, to obtain a copy of the hearing notice or to otherwise learn of the court's expectations. In any event, on October 13, 2009, Oatis wrote to his clients: " After the court decides how to handle these matters going forward, we will need to discuss our strategy. Our choice will probably be between waging a procedural battle against this process or putting our efforts into expert testimony to challenge this plan on its merits."
The October 21, 2009 hearing proceeded before Judge Klaczak. Diamond, Home Depot, and the town appeared and brought their relevant witnesses. Oatis appeared, but was not prepared. At the hearing, the court, Klaczak, J.T.R., granted Montigny's renewed mandamus petition. Oatis verbally requested a continuance of the hearing, stating: " [T]he intervener is not prepared, given an ambiguity in the Appellate Court's decision, we are not prepared today to offer expert testimony regarding environmental issues provided by this settlement." Oatis opposed the hearing going forward, stating among other things: " Your Honor . . . I don't believe we hold an 8-8(n) hearing. 8-8(n) hearings are only for zoning appeals . . . What I would say is that in this case the interveners go back to square one since we were not even allowed to intervene . . . The statute does not provide for an 8-8(n) hearing[ ] of mandamus actions." Judge Klaczak rejected Oatis's arguments, stating that compliance with § 8-8(n) was the purpose of the October 21, 2009 hearing. Judge Klaczak further stated: " Well it's a hearing that's been scheduled. I don't want to waste the resources again. We have all these people here ready to testify, ready to put on their case. You have been notified, however you received notice. There was no request for a continuance until this morning. You obviously aren't prepared to put on any evidence. I don't think it's appropriate to grant a continuance under the circumstances. I think it's almost an affront to the resources of the Court." An attorney for one of the parties stated to Judge Klaczak that, in the event Oatis were granted a continuance, he should be required to provide an offer of proof regarding who he would call to testify at a future hearing. Oatis was unable to do so. Although Oatis testified at trial that he was not given an opportunity during the October 21, 2009 hearing to identify Carlson as an expert on whom he would rely in support of Montigny's environmental claims, when asked by Judge Klaczak, " you don't have any evidence to put on to contest the reasonableness of the agreement, " Oatis simply responded: " First of all, your Honor, I think they have the burden of showing what the agreement is." Oatis never identified Carlson at any time during the hearing, despite having numerous opportunities to speak. " We don't have an expert to provide testimony today so that's not going to happen." There was no mention of having Carlson, or any other expert, " in the wings." The fact was, as of the October 21, 2009 hearing, neither Oatis nor any SGV member had retained any experts nor procured any expert opinions to proffer, including from Carlson.
Oatis continued to repeat the same § 8-8(n) argument throughout the hearing, essentially ignoring and/or refusing to accept the Appellate Court's opinion, causing Judge Klaczak to respond: " I'm following the dictate of the Appellate Court as far as I can tell . . . The remand order is pretty clear." After even more pushback from Oatis regarding proceeding with the hearing, Judge Klaczak stated: " We're conducting it because the Appellate Court said to do it. It's as simple as that." Eventually, Oatis cross examined two adverse witnesses but asked no questions related to the environment. Oatis then called Summers as his only witness, but his very limited questioning of Summers had nothing to do with any environmental concerns.
Following the hearing, Summers reacted this way: " The October 21, 2009 hearing did not go well. Derek did not understand what the hearing was about and was not prepared for it. Derek thought that the hearing was about determining the next step, but it was actually about settling the matter that was remanded from the Appellate Court back to the Superior Court. I was sick that day and did not plan to go to the hearing. Deb Wilson called me, somewhat panicked, after the hearing had been going on for about an hour and said that I needed to testify. When I got there, Derek asked if I would testify that Hal Cummings was holding a piece of paper, which he said was standing orders to mediate the Home Depot application with PZC . . . I was surprised that Derek asked me to make that statement. He appeared to be grasping at straws . . ." Letendre had similar reservations about Oatis at the time, concluding that he had not taken the time to digest the Appellate Court's decision. Letendre stated: " For example, I had read it a couple of times and thereafter thought we should be readying to make the environmental arguments ASAP, that is hire an expert. I sent him (and I think you all) an email to that effect. Derek didn't reply."
A few weeks later, on or about November 11, 2009, Attorney Richard P. Weinstein, counsel for Diamond, sent Oatis a letter raising questions about Montigny's claims in the petitions to intervene that Walker Reservoir East is a source of public water (Weinstein letter). On November 13, 2009, Oatis provided the SGV members with a copy of the Weinstein letter. That same day, Letendre responded to Oatis:
Derek--I'm concerned. Who drafted the petition?
Walker Reservoir is NOT a source of public water supply. Weinstein is right--it is an error. Further the rest of that paragraph is not accurate. There is indeed an aquifer underlying the area--but it is NOT tapped for pub[l]ic water supply--there is no well.
(And--a watershed does not lie underneath. A watershed is comprised of all the lands that contribute runoff to the River. The Tank. watershed is about 12.9 square miles.)
This petition was drafted in 2007--why didn't we see it and pick this error up sooner?
Ann(Emphasis in original.) That same day, Oatis replied: " Ann; How do we put the best 'spin' on this?" Letendre responded: " Derek--I think the best we might do would be to say that because an aquifer lies underneath the area that it is a potential source of drinking water. . . . But it's pretty clear that is not what is written." Following his receipt of the Weinstein letter, Montigny responded to Oatis: " Derek, I specifically remember that we had a discussion about the 'source of drinking water' statement at the time I signed one of these petitions. When I read the petition in your office, I mentioned that I did not think Walker Reservoir was used for drinking water, but was still a very important part of the ecosystem of the area. You said you would check that out and amend this. What I'm seeing from Weinstein's note is, it was not amended." Montigny, Letendre, and Summers acknowledged a loss of confidence in Oatis in November 2009. The petitions were neither withdrawn nor amended.
On December 3, 2009, the trial court, Klaczak, J.T.R., issued its decision on the issues presented at the October 21, 2009 hearing. The court expressly found that " [t]he Court file reflects that 'JDNOs' [a type of court notice] were sent to the attorneys for all parties that the hearing ordered in the remand would be heard on October 21, 2009. Counsel were instructed to appear with parties and witnesses prepared and ready to proceed." The court further stated that Diamond's and the town's counsel were present with witnesses and prepared to proceed. The court found that Oatis was present, had no witnesses, had ample notice of the hearing, and that he was or should have been aware that a § 8-8(n) hearing would take place. The court held that " the intervenor [Montigny] was not in court and offered no evidence to support any claim of an environmental impact from the proposed development. Thus the Court cannot find any basis for finding an adverse environmental impact." Thereupon, Judge Klaczak found the proposed settlement to be fair, reasonable, and just, reached by good faith negotiations with substantial concessions by Diamond, including a reduction in the size of the proposed building and lot coverage, the replacement of the original septic system with municipal sanitary sewer, a public water line in lieu of wells, and a more expansive storm water system. Thus, the court approved the settlement and ordered that judgment enter in accordance with the settlement.
As Oatis told his clients, the decision was " hardly a surprise." Nevertheless, on December 22, 2009, Oatis filed a motion to reargue the December 3, 2009 decision, claiming that Judge Klaczak: " 1. Misapprehended the Appellate Court's September 2009 remand decision; 2. Held a 'hearing' which did not comply with C.G.S. § 8-8; and, 3. Failed to recognize that the court file misconstrued the Appellate Court's decision and mistakenly represented that the Intervener was not a party and was not required to receive notice." Oatis previously had made these arguments in his November 23, 2009 post-hearing brief. The court denied the motion to reargue. Oatis recommended, and SGV agreed, that he pursue an appeal. On January 22, 2010, Oatis, on behalf of Montigny, filed an appeal from Judge Klaczak's December 3, 2009 decision. Oatis claimed on appeal that Judge Klaczak: (1) improperly denied his request for a continuance; (2) misinterpreted the Appellate Court's September 2009 remand decision; and (3) improperly approved the February 7, 2008 settlement without Montigny's consent. Diamond 67, LLC, 127 Conn.App. at 637.
In a decision officially released on April 5, 2011, the Appellate Court issued its unanimous decision, affirming the December 3, 2009 judgment of the trial court. Diamond 67, LLC v. Planning & Zoning Commission, 127 Conn.App. 634, 15 A.3d 1112 (2011). The Appellate Court stated: " Pursuant to this court's remand order, on September 29, 2009, the trial court issued a computer generated notice of hearing scheduled for October 21, 2009, to all of the parties." Id. at 642. The Appellate Court went on to state: " According to court records, this notice was sent to Montigny's counsel. The notice provided that '[t]he above captioned matter is assigned for hearing at the date and time above. All counsel, parties and necessary witnesses must attend . . .'" Id. at 642 n.5. The Court affirmed the trial court's denial of Oatis's request for a continuance, id. at 648, and held that " [t]he trial court followed this court's mandate and conducted a hearing compliant with § 8-8(n). Montigny's claim that the court misinterpreted our remand order is without merit." Id. at 650. Rejecting Montigny's final claim that the trial court had improperly approved the settlement without his consent, the Appellate Court reasoned: " The trial court granted Montigny's motion to intervene in this mandamus action and afforded him the opportunity to present evidence relating to his claim of an environmental impact from the proposed development. Montigny did not avail himself of that opportunity. He was not present at the hearing, and his counsel presented no witnesses or documentary evidence to support his environmental claim. Lacking any evidence addressed to environmental issues, the court, as stated in its decision, could not find any basis for finding an adverse environmental impact from the proposed development. We conclude that Montigny abdicated his right of approval by abandoning his responsibility to raise environmental issues as an intervenor pursuant to § 22a-19." Id. at 650-51. On or about April 25, 2011, Oatis, on behalf of Montigny, filed a petition for certification to the Supreme Court, which was denied on or about June 2, 2011.
Meanwhile, on October 1, 2010, Home Depot sold the subject property back to Diamond, and the project was dead.
III
Motions for Directed Verdict
Toward the end of trial, the defendants moved for directed verdict, regarding which the court reserved ruling. Summers and Letendre filed written motions, and Oatis and Lobo & Associates orally moved for directed verdict, adopting Letendre's and Summers' arguments (except with respect to the advice of counsel defense). Letendre further joined Summers' arguments. The court heard oral argument on such motions on March 31, 2017. Because of the unique posture of the case, namely, that the probable cause determination and underlying findings of fact would be made by the court after the jury made its findings, the court has concluded that it would be procedurally nonsensical to adjudicate the motions themselves. That is, because the jury's role was limited to answering jury interrogatories, there is simply no verdict to direct. Nevertheless, in connection with the court's resolution of the issues reserved for its determination, the court will address, as appropriate, the arguments made in the motions and at oral argument by counsel. The court finds that this approach is consistent with Practice Book § 16-37, which governs " Reservation of Decision on Motion for Directed Verdict."
IV
Legal Principles
A
Common-Law Vexatious Litigation
" In Connecticut, the cause of action for vexatious litigation exists both at common law and pursuant to statute." Bernhard-Thomas Building Systems, LLC v. Dunican, 286 Conn. 548, 554, 944 A.2d 329 (2008). " [T]o establish a claim for vexatious litigation at common law, one must prove want of probable cause, malice and a termination of suit in the plaintiff's favor." Id.
With regard to the first element, " the legal idea of probable cause is a bona fide belief in the existence of the facts essential under the law for the action and such as would warrant a man of ordinary caution, prudence and judgment, under the circumstances, in entertaining it . . . Probable cause is the knowledge of facts, actual or apparent, strong enough to justify a reasonable man in the belief that he has lawful grounds for prosecuting the defendant in the manner complained of . . . Thus, in the context of a vexatious suit action, the defendant lacks probable cause if he lacks a reasonable, good faith belief in the facts alleged and the validity of the claim asserted . . ." (Citations omitted; internal quotation marks omitted.) DeLaurentis, 220 Conn. at 256. " Whether the facts are sufficient to establish the lack of probable cause is a question ultimately to be determined by the court, but when the facts themselves are disputed, the court may submit the issue of probable cause in the first instance to a jury as a mixed question of fact and law. Cosgrove Development Co. v. Cafferty, 179 Conn. 670, 671, 427 A.2d 841 (1980); see 3 Restatement (Second), Torts § 681B." DeLaurentis, 220 Conn. at 252-53.
As stated above, the parties stipulated that the court would decide all issues relating to probable cause.
The probable cause standard is not more stringent in the context of a vexatious litigation claim against an attorney and/or law firm. Falls Church Group, Ltd. v. Tyler, Cooper and Alcorn, LLP, 281 Conn. 84, 100, 102, 912 A.2d 1019 (2007). Instead, the critical question is whether " on the basis of the facts known by the law firm, a reasonable attorney familiar with Connecticut law would believe" he or she had probable cause to bring or pursue the litigation. (Emphasis added.) Id. at 104-05. The standard is an objective one that is necessarily dependent on what the attorney knew when he or she initiated and/or continued the litigation. Id. at 98.
" Probable cause, of course, can be lost during the course of an action. See, e.g., DeLaurentis [, 220 Conn. at 248] (there may be liability for vexatious 'initiation, continuation or procurement of civil proceedings' [emphasis added; internal quotation marks omitted])." (Brackets in original.) Schaeppi v. Unifund CCR Partners, 161 Conn.App. 33, 45 n.6, 127 A.3d 304 (2015); see also, e.g., Restatement (2d) Torts, § 674, cmt. d (" An attorney may also be subject to liability if he takes an active part in continuing a civil proceeding properly begun, for an improper purpose and without probable cause").
B
Statutory Vexatious Litigation
" The statutory cause of action for vexatious litigation exists under § 52-568, and differs from a common-law action only in that a finding of malice is not an essential element, but will serve as a basis for higher damages [i.e., treble damages]." (Internal quotation marks omitted.)
Bernhard-Thomas Building Systems, LLC, 286 Conn. at 554. General Statutes § 52-568 provides: " Any person who commences and prosecutes any civil action or complaint against another, in his own name or the name of others, or asserts a defense to any civil action or complaint commenced and prosecuted by another (1) without probable cause, shall pay such other person double damages, or (2) without probable cause, and with a malicious intent unjustly to vex and trouble such other person, shall pay him treble damages."
V
Claims Against Oatis and Lobo & Associates
A
Because the jury found that Oatis did not act with malicious intent in connection with his conduct in the Underlying Proceedings, it necessarily follows that Diamond failed to prove a necessary element of its common law vexatious litigation claims, as well as its statutory vexatious claims for treble damages, against Oatis and Lobo & Associates. Accordingly, judgment shall enter in favor of Oatis and Lobo & Associates on counts one, three, four, and six of the third amended complaint.
B
The court next considers whether Diamond has proven its remaining statutory vexatious litigation claims (for double damages) against Oatis and Lobo & Associates. Diamond argues that the defendants lacked probable cause in initiating and/or continuing the intervention efforts in the mandamus action and the administrative appeal, contending that there were no grounds to support a good faith belief in the facts asserted, the validity of the claim, or the purpose pursued. Specifically, Diamond relies on the proposition that the defendants knew that certain factual allegations in the petitions at issue were false, that the adverse environmental impacts alleged in the petitions had already been rejected in Judge Klaczak's wetlands decision, the defendants never had site-specific expert evidence of adverse impacts necessary to succeed on their environmental claims, and the defendants were using the petitions to challenge procedure, not substance. The court addresses Oatis's conduct in the mandamus action and the administrative appeal separately.
1
Mandamus Action
The court must consider whether Oatis and Lobo & Associates had probable cause to file the mandamus petition and to continue thereafter to pursue Montigny's and SGV's interests in the mandamus proceedings. Taking into account the facts known by Oatis, the court concludes that a reasonable attorney familiar with Connecticut law would believe that he had probable cause to file the mandamus petition in September 2007 and pursue Montigny's right to intervene through the October 21, 2009 hearing, at which time the trial court granted Montigny's renewed mandamus petition pursuant to the directive of the Appellate Court. The court concludes, however, that probable cause was lost thereafter. That is, in light of the circumstances underlying Montigny's " abdicat[ing] his right of approval by abandoning his responsibility to raise environmental issues as an intervenor pursuant to § 22a-19, " Oatis and Lobo & Associates no longer had probable cause to continue the proceedings after Judge Klaczak's December 3, 2009 decision. For ease of reference, the court will refer to the period of time from December 3, 2009 through the termination of the mandamus action as the " Vexatious Period."
Notwithstanding the court's probable cause determination relating to conduct prior to the Vexatious Period, the court nonetheless frowns upon Oatis's sloppy billing practices, filing court submissions riddled with typographical errors, questionable recordkeeping and document retention practices, and using unprofessional language concerning opposing counsel and the court in client communications not befitting an attorney.
From the beginning of Oatis's representation of SGV in July 2007, Oatis and the SGV members knew that, in order to prove their environmental claims, they needed experts to " build upon" what had been submitted in the wetlands proceedings. Oatis and SGV discussed the need for additional expert evidence in their first meeting in July 2007. Their joint intention was to present to the zoning commission expert environmental evidence that the proposed Home Depot project would have an adverse environmental impact. Their early communications and interactions bear out that intention. SGV discussed with Oatis their concerns about the proposed development's environmental impact on Walker's Reservoir and the Tankerhoosen River. Their knowledge was formed from a number of sources, including but not necessarily limited to what they had learned in the wetlands proceedings from Luce, Seymour, and Letendre, the plan of conservation and its cautions about the extent of impervious surfaces, their personal knowledge of Walker Reservoir as a recreational area, and the Fuss & O'Neil report and its findings concerning additional development in the Exit 67 corridor. Not aware of any facts that were false or incomplete, Oatis prepared the mandamus petition.
At trial, Oatis, Montigny, Letendre, and Summers testified credibly that " everything changed" when Diamond filed its mandamus action, because it then became unclear whether SGV would ever have an opportunity to present evidence of an adverse environmental impact. Indeed, Diamond objected to Montigny's mandamus petition, the trial court initially denied that petition, and the settlement discussions among Diamond, Home Depot, and the zoning commission took place without Oatis being able to participate on behalf of Montigny and SGV. The renewed mandamus petition was not granted until October 21, 2009, following the Appellate Court's September 2009 decision reversing the petition's prior denial. Because the renewed mandamus petition was ultimately granted, its granting provides at least some support for a finding of probable cause underlying its filing. See Byrne v. Burke, 112 Conn.App. 262, 276, 962 A.2d 825 (2009) (" We conclude that the Probate Court's ruling in favor of Spurling's client was conclusive evidence of probable cause. Although the Probate Court's ruling was later reversed on appeal in the plaintiff's favor, the ruling was a valid judgment in favor of Spurling's client, and both sides had an opportunity to defend and to argue a position. The Probate Court's ruling, regardless of its subsequent reversal, served as an absolute protection against an action for vexatious litigation"); see also Lichaj v. Sconyers, No. LLI-CV13-6009850S, 2014 WL 5138003, at *3-4 (Conn.Super. Sept. 1, 2014) (Pickard, J.) (following courts of California, Georgia, and Pennsylvania, court concluded that denial of summary judgment in claimed vexatious matter established probable cause to bring such suit), aff'd on other grounds, 163 Conn.App. 419, 426 n.5, 137 A.3d 26 (2016) (" We express no opinion as to whether a denial of a motion for summary judgment, without more, is sufficient to negate the lack of probable cause for the purpose of a subsequent action in vexatious litigation").
However, when Oatis, on behalf of Montigny and SGV, finally obtained a successful result on the renewed mandamus petition in September 2009, he did nothing to prepare for the moment for which he and his clients claimed to be waiting. Following the Appellate Court's remand decision, and as revealed in a September 15, 2009 email, Oatis had either lost interest and/or any meaningful intention in raising environmental concerns on behalf of Montigny and SGV. Instead of carefully observing the clear remand of the Appellate Court granting him substantive relief, Oatis chose to ignore it and press purely procedural arguments. Oatis knew this approach would be unsuccessful. On September 16, 2009, approximately five weeks prior to the October 21, 2009 hearing, Oatis wrote that he had " a sinking feeling that the trial court will hold an 8-8(n) hearing and that it will then rule that we have no [sic] established our burden under CEPA." Even when his own client, Letendre, raised her concern on September 18, 2009, asking Oatis whether they should " be thinking about hiring an environmental expert in the event-or at least have someone waiting in the wings-in case we do get to [a] hearing, " Oatis did not respond. He was simply willing to take his chances, ignore the clear remand order, and count on taking another appeal when unsuccessful. Notably, two years earlier, in November 2007, Oatis had acknowledged that if intervention were allowed in the mandamus action, he would " need to be ready with experts to testify at [a] court hearing or before the PZC if the Court sends it back to them." (Emphasis added.)
Oatis's gamble was unsuccessful, and his " sinking feeling" that the trial court would hold a § 8-8(n)-type hearing--about which he did nothing to address--was proven true. After the court's December 3, 2009 decision, however, Oatis remained undeterred, filing a pro fauna motion to reargue, which was nothing more than a rehash of the arguments he made in the post-trial brief, making no attempt to comply with the standard governing a motion to reargue. He again blamed his lack of preparedness on the court, claiming that the court did not send him the notice of the October 21, 2009 hearing because the court's electronic case detail incorrectly referred to the Appellate Court's action as having " [a]ffirmed" Judge Sferrazza's decision to deny Montigny's mandamus petition. This argument was rank speculation. It would have taken Oatis virtually no effort to inquire of the clerk's office and/or the case flow coordinator and learn that the court's computer system reflects that a notice was in fact sent to his office . And he could have just as easily obtained a copy of the notice, having learned, by at least October 13, 2009, that a hearing was scheduled for October 21, 2009.
The trial court stated as much in its December 3, 2009 decision: " The Court file reflects that 'JDNO's' were sent to the attorneys for all parties that the hearing ordered in the remand would be heard on October 21, 2009"). The Appellate Court confirmed the trial court's finding: " The [trial] court indicated, and our review of the court records confirms, that notice was sent to Montigny's counsel." Diamond 67, LLC, 127 Conn.App. at 648.
The appeal that followed also lacked probable cause. Oatis claimed on appeal that Judge Klaczak erred in denying his motion for continuance made during the October 21, 2009 hearing. The Appellate Court rejected this claim. The Court confirmed the trial court's finding that " notice was sent to Montigny's counsel." Id. at 648. No other party claimed lack of notice, and indeed the other parties and their witnesses appeared. However, even if Oatis's representation were to be believed, it is not disputed that Oatis had actual notice of the October 21, 2009 hearing at least by October 13, 2009 (when he emailed his clients about the scheduled hearing), yet did nothing to inquire of the court to learn the contents of the notice. A reasonable attorney familiar with Connecticut law would not have continued the proceedings on this basis. Thus, Oatis's continuation of the mandamus proceedings on this basis lacked probable cause. See Restatement (2d) of Torts, § 674, cmt. c (" Continuation of civil proceedings . As in the case of criminal prosecutions (see § 655), one who continues a civil proceeding that has properly been begun or one who takes an active part in its continuation for an improper purpose after he has learned that there is no probable cause for the proceeding becomes liable as if he had then initiated the proceeding . . ."). Oatis also claimed in part that Judge Klaczak misinterpreted the Appellate Court's September 2009 decision, despite the clarity of the remand order: " On remand, before rendering judgment in accordance with a settlement between the [plaintiff] and the defendant, the court must conduct a hearing complaint with § 8-8(n) to review the settlement, in which Montigny is entitled to participate for the purpose of raising environmental issues." Diamond 67, LLC, 117 Conn.App. at 85. The Appellate Court found: " The direction to the trial court is clear . . . Montigny's claim that the court misinterpreted our remand is without merit." It was not only without merit, it lacked probable cause. Oatis further claimed on appeal that Judge Klaczak improperly approved the February 8, 2007 settlement without Montigny's consent. The Appellate Court rejected this argument and held: " Montigny abdicated his right of approval by abandoning his responsibility to raise environmental issues as an intervenor pursuant to § 22a-19." Diamond 67, LLC, 127 Conn.App. at 651.
After October 21, 2009, all of Oatis's efforts were rejected by the courts, specifically, Judge Klaczak's December 3, 2009 decision, the subsequent denial of Oatis's motion to reargue, and the appeal that followed. Although these adverse decisions are not dispositive as to want of probable cause, they are at least a factor that the court has considered. Diamond has separately proven want of probable cause as of December 3, 2009. The court concludes that a reasonable attorney familiar with Connecticut law would not believe that probable cause existed to support the continuation of the proceedings following Judge Klaczak's December 3, 2009 decision.
Diamond argues that Oatis lacked probable cause to file the mandamus petition in the first instance because neither he nor SGV had retained any experts at the time to support the environmental claims made in the mandamus petition. The court disagrees. There was simply no statutory or other requirement at the time Oatis filed the mandamus petition, such that the retention of one or more experts was a necessary predicate to the filing. Unlike General Statutes § 52-190a, relating to the filing of a negligence claim against a health care provider and requiring that the attorney obtain in advance a signed, written opinion of a similar health care provider that there appears to be evidence of medical negligence, § 22a-19 contains no provision requiring a petitioner or his attorney to retain an expert to opine on the validity of the environmental petitioner's claims prior to, or as a condition precedent to, the filing of a § 22a-19 petition. Nor is there any such requirement set forth in River Bend Assocs., Inc. v. Conservation & Inland Wetlands Comm'n of Town of Simsbury, 269 Conn. 57, 848 A.2d 395 (2004), as Diamond suggests. Although expert evidence, separate from what had been presented to the wetlands commission, would eventually be required in order for Oatis ultimately to prove Montigny's environmental claims, the court cannot find that Oatis and/or SGV was required to have retained such experts at the time Oatis filed the mandamus petition.
Diamond also claims that a want of probable cause is demonstrated by the fact that the mandamus petition contained factual representations regarding public drinking water that were untrue. Although the inclusion of such allegations reflects sloppy work on the part of Oatis and poor proofreading by Montigny, the court cannot conclude that the factual inaccuracies were deliberately placed before the court. Oatis and Montigny testified that, at the time of the filing of the mandamus petition, they believed that the references to Walker Reservoir being a source of public drinking water had been removed from the final version. Moreover, the regrettable inclusion of such allegations did not cause the vexatious continuation of the mandamus action after Judge Klaczak's December 3, 2009 decision, and it does not appear to have had any impact on Montigny's success in obtaining intervenor status.
In claiming that Diamond cannot prevail on any portion of its vexatious litigation claims, Oatis and Lobo & Associates first argue that the first element of vexatious litigation is not satisfied because the defendants must have commenced a civil action. They argue that the Appellate Court, in its decision remanding this case for trial, improperly applied the Supreme Court's decision in Bhatia v. Debek, 287 Conn. 397, 948 A.2d 1009 (2008), when it concluded that proof of initiation of suit is not required in a vexatious litigation suit. Diamond 67, LLC, 167 Conn.App. at 681. Oatis and Lobo & Associates also argued during the argument on the motions for directed verdict that Bhatia itself was wrongly decided. In either event, it is beyond dispute that this court is bound by the express holdings of the Appellate Court's remand decision returning this case for trial. See Bauer v. Waste Management of Conn., Inc., 239 Conn. 515, 522, 686 A.2d 481 (1996) (" In carrying out a mandate of [a reviewing] court, the trial court is limited to the specific direction of the mandate as interpreted in light of the opinion . . . This is the guiding principle that the trial court must observe . . . The trial court should examine the mandate and the opinion of the reviewing court and proceed in conformity with the views expressed therein . . ." [Citations omitted; internal quotation marks omitted]; Wendland v. Ridgefield Construction Servs., Inc., 190 Conn. 791, 795, 462 A.2d 1043 (1983) (" No judgment other than that directed or permitted by the reviewing court may be rendered, even though it may be one that the appellate court might have directed." [Internal quotation marks omitted.]). In its remand decision, the Appellate Court rejected the defendants' alternative ground for affirmance that they did not initiate or procure any suit against Diamond. The Court expressly stated that " although '[b]oth the common law and statutory causes of action [for vexatious litigation] [require] proof that a civil action has been prosecuted'; (internal quotation marks omitted) Bernhard-Thomas Building Systems, LLC v. Dunican, supra, 286 Conn. at 554, 944 A.2d 329; it is not necessary for the defendant to have initiated the civil action. 'Most courts now agree with the Restatement (Second) of Torts, § 680, which permits liability for vexatious " initiation, continuation or procurement of civil proceedings against another before an administrative board that has power to take action adversely affecting the legally protected interests of the other." ' (Emphasis added.) DeLaurentis [, 220 Conn. at 248]." (Alterations in original.) Diamond 67, LLC, 167 Conn.App. at 681-83. The Court went on to conclude that Diamond " submitted evidence establishing that there is a genuine issue of material fact as to each defendant's participation in the initiation, procurement, and/or continuation of their respective interventions in the plaintiff's administrative and mandamus actions against the planning and zoning commission." (Emphasis added.) Id. at 683. Thus, it is clear that the Appellate Court, in reliance on DeLaurentis, 220 Conn. at 248, applied Restatement (Second) of Torts, § 680, and rejected the defendants' argument, as a matter of law, that initiation of a suit is required to support a vexatious litigation claim. This court is bound by the Appellate Court's remand decision and will not depart from it. Accordingly, the court concludes that Oatis's conduct during the Vexatious Period constitutes the " continuation" of civil proceedings, which is sufficient to support a claim for vexatious litigation.
Oatis and Lobo & Associates next argue that in order to prove vexatious litigation, the plaintiff must demonstrate that the underlying proceeding at issue was a civil action with an accompanying, signed writ of summons, which is absent here in connection with any of Oatis's challenged filings. This argument, too, was necessarily rejected by the Appellate Court in its remand decision by virtue of its holding that " the operative proceedings at issue are the defendants' interventions in the mandamus and administrative actions, not the mandamus or administrative actions themselves." Diamond 67, LLC, 167 Conn.App. at 684. That is, for this court to adopt Oatis and Lobo & Associates' argument--that a vexatious litigation claim could not be maintained against them because they did not have to serve a writ of summons in connection with the intervention petitions and related litigation--would be inconsistent with the Appellate Court's holding that initiation of a civil suit is not required and that continuation of civil proceedings is sufficient to support a vexatious litigation claim.
Oatis and Lobo & Associates also argue that Diamond has failed to prove that the Underlying Proceedings terminated in Diamond's favor. Oatis and Lobo & Associates acknowledge that the appeal from Judge Klaczak's December 2009 decision did terminate in Diamond's favor. Because of the court's limitation of its finding of a lack of probable cause to the so-called Vexatious Period in the mandamus action, the court need not address Oatis and Lobo & Associates' remaining termination arguments.
In sum, the court concludes that Diamond has proven its statutory vexatious claim for double damages against Oatis and Lobo & Associates with respect to the extent of the Vexatious Period of the mandamus action.
2
Noerr-Pennington Doctrine
In light of the court's finding of liability under § 52-568 under count two as to Oatis and Lobo & Associates, the court now addresses their special defense that their conduct in the Underlying Proceedings was speech protected by the Noerr-Pennington doctrine. Diamond argues, as a matter of law, that the Noerr-Pennington defense is not available in connection with a vexatious litigation claim. According to Diamond, " the elements of the sham exception to Noerr-Pennington are equivalent to the elements of a vexatious litigation claim such that whenever a plaintiff establishes liability for vexatious litigation, the sham exception will necessarily also apply." The defendants argue that Noerr-Pennington is available and that Diamond has not satisfied its burden to prove the so-called sham exception. Based on the Appellate Court's decision in Zeller v. Consolini, 59 Conn.App. 545, 758 A.2d 376 (2000), the court agrees with the defendants.
Professional Real Estate Investors, Inc. v. Columbia Pictures Industries, Inc., 508 U.S. 49, 56-60, 113 S.Ct. 1920, 123 L.Ed.2d 611 (1993), sets forth a helpful summary of the development of Noerr-Pennington immunity.
" Under the Noerr-Pennington doctrine-established by Eastern Railroad Presidents Conference v. Noerr Motor Freight, Inc., 365 U.S. 127, 81 S.Ct. 523, 5 L.Ed.2d 464 (1961), and United Mine Workers v. Pennington, 381 U.S. 657, 85 S.Ct. 1585, 14 L.Ed.2d 626 (1965)-defendants are immune from antitrust liability for engaging in conduct (including litigation) aimed at influencing decisionmaking by the government. PRE, 508 U.S., at 56, 113 S.Ct. 1920." Octane Fitness, LLC v. ICON Health & Fitness, Inc., 134 S.Ct. 1749, 1757, 188 L.Ed.2d 816 (2014).
As stated by the Appellate Court in Zeller, " the Noerr-Pennington doctrine 'shields from the Sherman Act [15 U.S.C. § 1 et seq.] a concerted effort to influence public officials regardless of intent or purpose.' United Mine Workers v. Pennington, supra, at 670, 85 S.Ct. 1585. The United States Supreme Court has reasoned that 'it would be destructive of rights of association and of petition to hold that groups with common interests may not, without violating the antitrust laws, use the channels and procedures of state and federal agencies and courts to advocate their causes and points of view respecting resolution of their business and economic interests vis-à-vis their competitors.' California Motor Transport Co. v. Trucking Unlimited, supra, 404 U.S. 508 at 510-11, 92 S.Ct. 609, 30 L.Ed.2d 642."
" The Noerr-Pennington doctrine has evolved from its antitrust origins to apply to a myriad of situations in which it shields individuals from liability for petitioning a governmental entity for redress. [A]lthough the Noerr-Pennington defense is most often asserted against antitrust claims, it is equally applicable to many types of claims which seek to assign liability on the basis of the defendant's exercise of its first amendment rights.' (Internal quotation marks omitted.) Central Telecommunications, Inc. v. TCI Cablevision, Inc., 800 F.2d 711, 717 n.7 (8th Cir. 1986), cert. denied, 480 U.S. 910, 107 S.Ct. 1358, 94 L.Ed.2d 528 (1987) . . .
" Although the Noerr-Pennington doctrine provides broad coverage to petitioning individuals or groups, its protection is not limitless. In Eastern Railroad Presidents Conference v. Noerr Motor Freight, Inc., supra, 365 U.S. at 144, 81 S.Ct. 523, the United States Supreme Court, albeit in dictum, established a 'sham exception' to the general rule, stating: 'There may be situations in which a publicity campaign, ostensibly directed toward influencing governmental action, is a mere sham to cover what is actually nothing more than an attempt to interfere directly with the business relationships of a competitor and the application of the Sherman Act would be justified.' Id. In short, petitioning activity is not protected if such activity is a mere sham or pretense to interfere with no reasonable expectation of obtaining a favorable ruling." (Alterations in original.) Zeller, 59 Conn.App. at 550-52 .
In Professional Real Estate Investors, Inc. v. Columbia Pictures Industries, Inc., 508 U.S. 49, 60-62, 113 S.Ct. 1920, 123 L.Ed.2d 611 (1993), the United States Supreme Court outlined a two-prong test to satisfy the sham exception to Noerr-Pennington immunity, as that doctrine applies in the context of litigation. First, " the lawsuit must be objectively baseless in the sense that no reasonable litigant could realistically expect success on the merits." Id. at 60. Second, " [o]nly if challenged litigation is objectively meritless may a court examine the litigant's subjective motivation. Under this second part of our definition of sham, 'the court should focus on whether the baseless lawsuit conceals an attempt to interfere directly with the business relationships of a competitor . . . through the use [of] the governmental process--as opposed to the outcome of that process--as an anticompetitive weapon . . ." Id. at 60-61. " A classic example is the filing of frivolous objections to the license application of a competitor, with no expectation of achieving denial of the license but simply in order to impose expense and delay." City of Columbia, 499 U.S. at 380, 111 S.Ct. 1344. For the sham exception to apply, " the plaintiff [in the underlying proceeding] must have brought baseless claims in an attempt to thwart competition . . ." Octane Fitness, LLC v. ICON Health & Fitness, Inc., 134 S.Ct. 1749, 1757, 188 L.Ed.2d 816 (2014). The plaintiff bears the burden of proving the application of the sham exception. Professional Real Estate Investors, Inc., 508 U.S. at 61.
In Zeller v. Consolini, the Appellate Court adopted the Noerr-Pennington doctrine and accompanying sham exception and extended the doctrine to common law claims, specifically, tortious interference with a business relationship and vexatious litigation. 59 Conn.App. at 554. The Court stated: " Application of the Noerr-Pennington doctrine to the situation in this case petitioning activity directed at local governments--already is well established . . . The Noerr-Pennington doctrine subordinates antitrust considerations and commercial expediency to the constitutional rights of individuals and groups to petition their government. Furthermore, failure to apply the Noerr-Pennington doctrine aggressively may create a 'chilling effect' on the first amendment right to petition in zoning and other matters . . . The Noerr-Pennington doctrine is a well established body of law applicable to a wide variety of situations involving petitioning activity, including local zoning and other municipality matters . . . [W]e fulfill the Second Circuit's prophecy and adopt the Noerr-Pennington doctrine and its accompanying sham exception as the applicable analysis for cases such as this one." Zeller, 59 Conn.App. at 552-54.
In Zeller, the plaintiffs brought claims against the defendants for tortious interference with a business relationship and vexatious litigation. Id. at 547. The defendants, who were individual citizens, their attorney, and their law firm, had challenged an inland wetlands permit and zone changes granted for the plaintiffs' subject property, including the filing of administrative appeals and related litigation, which were unsuccessful. Id. at 547-48. The trial court granted summary judgment in favor of the defendants based on Noerr-Pennington immunity. Id. at 548-49. On appeal, the Appellate Court held that the defendants' challenged actions " were not objectively baseless" and, therefore, the first prong of the sham exception to the Noerr-Pennington doctrine was not satisfied. Id. at 560-62. The Court went on to explain: " Because we find that the petitioning was not objectively baseless, we need not consider the second prong of the Noerr-Pennington sham exception, namely, whether the defendants' actions constituted an attempt to interfere with the plaintiffs through abuse of the petitioning process." (Emphasis added.) Id. at 563 n.8. Accordingly, the Appellate Court affirmed the judgment of the trial court granting the defendants' motions for summary judgment.
In addition, the court has carefully examined the Appellate Court opinion remanding the present case for trial. With regard to the Noerr-Pennington doctrine, the Court concluded that " a genuine issue of material fact remains as to whether the sham exception applies . . ." Diamond 67, LLC, 167 Conn.App. at 689. Specifically, the Court reasoned that " [t]he plaintiff submitted evidence that the defendants were aware that, contrary to their assertions throughout the proceedings, Walker Reservoir was not a source of drinking water . . . In addition, the plaintiff submitted evidence that the defendants were aware that they needed to obtain an expert to prevail on their environmental claims, yet failed to do so." Id. at 688-89. The Appellate Court refused to affirm the judgment on the alternative ground of the Noerr-Pennington doctrine, appearing to have concluded that there was a question of fact as to the first prong of the sham exception. The Court did not expressly address the second prong of the sham exception, other than to recite its definition (i.e., " whether the baseless lawsuit conceals an attempt to interfere directly with the business relationships of a competitor . . .") Id. at 687 (quoting Professional Real Estate Investors, 508 U.S. at 60-61).
Mindful of the above principles, the court considers the applicability of the Noerr-Pennington doctrine and its accompanying sham exception. It is not disputed that the challenged petitions to intervene and litigation activity that followed constitute petitioning activity directed toward influencing governmental action. The defendants uniformly maintain the position that they pursued the interventions in the Underlying Proceedings in order to present their environmental concerns before the zoning commission and thereby influence governmental action by exercising their first amendment rights.
With respect to the first prong of the sham exception, the court finds that it is satisfied. Notably, Zeller treats as equivalents (1) a finding of probable cause, and (2) a failure to prove the first prong of the sham exception. Zeller, 59 Conn.App. at 559-63. The United States Supreme Court also treated these elements as equivalents. See Prof'l Real Estate Inv'rs, Inc., 508 U.S. at 62-63 (" Under our decision today, therefore, a proper probable cause determination irrefutably demonstrates that [a] plaintiff has not proved the objective prong of the sham exception and that the defendant is accordingly entitled to Noerr immunity"). Here, the court concludes that the converse is also true. That is, the court's finding of a lack of probable cause with respect to the Vexatious Period necessarily requires the finding that Diamond has satisfied the first prong of the sham exception.
With respect to the second prong of the sham exception, the court finds that Diamond has not satisfied its burden to demonstrate that the Vexatious Period concealed an attempt to interfere directly with the business relationship of a competitor. There is no evidence in the record--and Diamond does not suggest otherwise--to support a finding that any defendant was at any relevant time a competitor of Diamond and/or Home Depot. Moreover, there is no evidence in the record to suggest that any of the defendants had any financial interest in the question of whether the Home Depot project would proceed, or not, in any of its proposed forms. Under such circumstances, the sham exception is not satisfied. See, e.g., Ex Parte Simpson, 36 So.3d 15, 28 (Ala. 2009) (sham exception was not satisfied because parties were not competitors). Moreover, the evidence relating to SGV's fundraising efforts, in which Oatis was not involved, is insufficient to overcome the second prong. Thus, the defendants' special defense of Noerr-Pennington immunity remains intact.
Diamond argues that the elements of the sham exception to the Noerr-Pennington doctrine and the elements of a vexatious litigation claim are essentially the same, such that if a plaintiff proves its vexatious litigation claim, the sham exception is necessarily satisfied. Although this argument has some appeal, it attempts too much, because it ignores entirely the second prong of the Noerr-Pennington doctrine, namely, that the vexatious proceedings concealed an attempt to interfere directly with the business relationship of a competitor. In Zeller, 59 Conn. 545, the Court concluded that the defendants' litigation conduct was not entirely baseless and that, therefore, the first prong of the sham exception was not satisfied. This conclusion meant that the shield provided by Noerr-Pennington was not pierced. The present case differs from Zeller because here, the court concludes that the first prong of the exception is satisfied, such that the court is required to address the second prong, which was unnecessary in Zeller, as the Court stated in footnote 8.
Diamond also relies on the procedural history of Zeller in support of its argument, contending that " the sham exception to Noerr-Pennington was used in Zeller to evaluate Plaintiff's claim for vexatious litigation rather than Noerr-Pennington being used as a defense." This argument is unavailing. The Zeller plaintiffs expressly invoked the Noerr-Pennington's sham exception as part of their affirmative claim. At such time the issue of Noerr-Pennington's application to Connecticut common-law claims was a question of first impression in our appellate courts. In any event, the court cannot conceive how the procedural distinction between Zeller and the present case is a meaningful one with respect to the Appellate Court's adoption and application of the sham exception.
Based on the foregoing, the court finds in favor of Oatis and Lobo & Associates on their special defense based on the Noerr-Pennington doctrine.
3
Administrative Appeal
In count five, Diamond asserts a statutory vexatious litigation claim (for double damages) based on Oatis and Lobo & Associates' representation of Montigny in pursuit of intervention in the administrative appeal, Diamond 67, LLC v. Planning and Zoning Commission of the Town of Vernon, No. TTD-CV07-4007637-S, judicial district of Tolland at Rockville. The court finds that probable cause existed to support the filing of Montigny's intervention petition in the administrative appeal and that there is insufficient evidence to find an absence of probable cause with regard to any continuation of the administrative appeal.
As an initial matter, Montigny's September 21, 2007 petition to intervene into the administrative appeal was granted by the court, Sferrazza, J. The court finds that the trial court's ruling in favor of Montigny with regard to that intervention petition supports a finding of probable cause. See Byrne, 112 Conn.App. at 276 (" We conclude that the Probate Court's ruling in favor of Spurling's client was conclusive evidence of probable cause. Although the Probate Court's ruling was later reversed on appeal in the plaintiff's favor, the ruling was a valid judgment in favor of Spurling's client, and both sides had an opportunity to defend and to argue a position. The Probate Court's ruling, regardless of its subsequent reversal, served as an absolute protection against an action for vexatious litigation"); see also, Lichaj, 2014 WL 5138003, at *3-4 (Pickard, J.) (following courts of California, Georgia, and Pennsylvania, court concluded that denial of summary judgment in claimed vexatious matter established probable cause to bring such suit).
After Montigny's petition to intervene into the administrative appeal was granted, it appears that there was little activity in that particular proceeding, as the mandamus action became the locus of Diamond's, Home Depot's, the zoning commission's, and Montigny's litigation activity. The record is incomplete as to the procedural development of the administrative appeal or its outcome. Accordingly, on this record, the court cannot conclude that any continuation of the administrative appeal lacked probable cause.
Based on the foregoing, judgment shall enter in favor of Oatis and Lobo & Associates with respect to count five of the third amended complaint.
VI
Claims Against Letendre and Summers
As stated above, by the end of the trial, the remaining counts against Letendre and Summers were Diamond's statutory vexatious litigation claims for double damages. Because an advice of counsel defense, when proven, serves as a complete defense to a vexatious litigation claim, e.g., Diamond 67, LLC, 167 Conn.App. at 689-90 (citing Vandersluis v. Weil, 176 Conn. 353, 361, 407 A.2d 982 (1978)), and in light of the jury's finding that Letendre and Summers had proven their special defenses of good faith reliance on advice of counsel, judgment shall enter in favor of Letendre on counts twenty-six and twenty-nine and in favor of Summers on counts thirty-two and thirty-five. In addition, for the reasons stated in part V.B.2 of this opinion, on the independent ground of Noerr-Pennington immunity, Letendre is entitled to judgment in her favor on counts twenty-six and twenty-nine, and Summers is entitled to judgment in his favor on counts thirty-two and thirty-five.
The above findings render it unnecessary to address Letendre's and Summer's arguments concerning probable cause. See Rieffel v. Johnston-Foote, 165 Conn.App. 391, 400-01, 410, 139 A.3d 729 (2016) (per curiam opinion affirming judgment of trial court and adopting its decision granting summary judgment in favor of neighbor defendants based on advice of counsel special defense to vexatious litigation claims without addressing probable cause).
VII
Conclusion
Based on the foregoing, judgment shall enter in favor of Derek V. Oatis and Lobo & Associates, LLC on counts one through six, in favor of Ann Letendre on counts twenty-six and twenty-nine, and in favor of John Summers on counts thirty-two and thirty-five.