Keith-Harper v. Lake Hosp. Sys., Inc. , 96 N.E.3d 823 ( 2017 )

[Cite as Keith-Harper v. Lake Hosp. Sys., Inc., 2017-Ohio-7361.]
IN THE COURT OF APPEALS
ELEVENTH APPELLATE DISTRICT
LAKE COUNTY, OHIO
LINDA KEITH-HARPER, : OPINION
Plaintiff-Appellant, :
(THE SPITZ LAW FIRM, LLC, et al., : CASE NO. 2015-L-137
Appellants), :
- vs - :
LAKE HOSPITAL SYSTEM, INC. et al., :
Defendants-Appellees. :
Civil Appeal from the Lake County Court of Common Pleas, Case No. 14 CV 000459.
Judgment: Affirmed.
Brian D. Spitz, The Spitz Law Firm, LLC, 25200 Chagrin Boulevard, Suite 200,
Beachwood, OH 44122 (Appellants).
Christopher B. Congeni and Daniel J. Rudary, Brennan, Manna & Diamond, 75 East
Market Street, Akron, OH 44308 (For Defendants-Appellees).
THOMAS R. WRIGHT, J.
{¶1} Appellants, Attorney Brian D. Spitz and the Spitz Law Firm, LLC
(collectively Spitz), appeal the trial court’s decision awarding Lake Hospital System, Inc.
and Maria Creagh $22,926.72 in attorney fees and expenses. We affirm.
{¶2} In February 2014, Spitz filed a complaint on behalf of Linda Keith-Harper
against Lake Hospital System, Inc. and Maria Creagh (collectively appellees). Keith-
Harper worked for the hospital as an LPN and thereafter an RN for more than 15 years.
Creagh became Keith-Harper’s supervisor and department manager in 2012 until Keith-
Harper was terminated in September of 2013.
{¶3} The complaint alleges seven causes of action against appellees arising
from Keith-Harper’s termination, including age discrimination, wrongful termination
based on age discrimination, disability discrimination based on Keith-Harper’s knee
replacement, wrongful termination based on disability discrimination, unlawful FMLA
retaliation, workers’ compensation retaliation, and intentional infliction of emotional
distress.
{¶4} Appellees filed their motion for summary judgment in December 2014.
The trial court granted summary judgment on all claims in appellees’ favor on May 27,
2015. No appeal was filed from this decision.
{¶5} Appellees subsequently filed a motion for sanctions under R.C. 2323.51
and Civ.R. 11 against plaintiff’s counsel Brian D. Spitz and the Spitz Law Firm, LLC.
The trial court held a frivolous conduct hearing, and thereafter concluded in its seven-
page decision that “Spitz’s conduct after December 16, 2014 met the criteria of frivolous
conduct under R.C. 2323.51(A)(2) * * *.” The trial court found Attorney Brian D. Spitz
and the Spitz Law Firm LLC jointly and severally responsible for $22,926.72 in
expenses and attorney fees the hospital incurred after most discovery had ended. The
court did not find a Civ.R. 11 violation.
{¶6} Spitz’s amended appellate brief asserts six assignments of error. We
address his first two assignments together for ease of analysis, which assert:
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{¶7} “The trial court committed reversible error by finding frivolous conduct in
prosecuting Keith-Harper’s claims.
{¶8} “Because Brian Spitz did not engage in any frivolous conduct, the trial
court erred in sanctioning him.”
{¶9} R.C. 2323.51(B)(1) provides:
{¶10} “[A]ny party adversely affected by frivolous conduct may file a motion for
an award of court costs, reasonable attorney’s fees, and other reasonable expenses
incurred in connection with the civil action or appeal. The court may assess and make
an award to any party to the civil action or appeal who was adversely affected by
frivolous conduct * * *.”
{¶11} Pursuant to R.C. 2323.51(B)(4), the award can be “made against a party,
the party’s counsel of record, or both.”
{¶12} R.C. 2323.51(A)(2) defines “frivolous conduct,” in relevant part, as:
{¶13} “(a) Conduct of [a] party to a civil action, * * * that satisfies any of the
following:
{¶14} “* * *
{¶15} “(iii) The conduct consists of allegations or other factual contentions that
have no evidentiary support or, if specifically so identified, are not likely to have
evidentiary support after a reasonable opportunity for further investigation or discovery.”
{¶16} Unlike Civ.R. 11, R.C. 2323.51 does not require a showing that the
individual willfully engaged in frivolous conduct. Grove v. Gamma Ctr., 3d Dist. Marion
No. 9-14-29, 2015-Ohio-1180, ¶115. R.C. 2323.51 uses an objective standard in
determining whether sanctions may be imposed for frivolous conduct. Kester v. Rogers,
11th Dist. Lake Nos. 93-L-056 and 93-L-072, 1994 Ohio App. LEXIS 1949, *10 (May 6,
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1994). Thus, a finding of frivolous conduct under R.C. 2323.51 is decided without
inquiry as to what the individual knew or believed, and instead asks whether a
reasonable lawyer would have filed the action or continued to pursue the claims in light
of existing law or facts in a particular case. Omerza v. Bryant & Stratton, 11th Dist.
Lake No. 2006-L-147, 2007-Ohio-5216, ¶15, citing City of Wauseon v. Plassman (Nov.
22, 1996), 6th Dist. No. F-96-003, 1996 Ohio App. LEXIS 5168, 8; Pingue v. Pingue, 5th
Dist. Delaware No. 06-CAE-10-0077, 2007-Ohio-4818, ¶20.
{¶17} The trial court held the frivolous conduct hearing August 20, 2015, and
thereafter held in part,
{¶18} “Spitz’s conduct after December 16, 2014 met the criteria of frivolous
conduct under R.C. 2323.51(A)(2) in that plaintiff’s allegations or other factual
contentions had no evidentiary support and were not likely to have evidentiary support
particularly after the first deposition of Keith-Harper which failed to provide evidence
supporting her claims.”
{¶19} It explained its decision in detail, stating why each of Keith-Harper’s claims
lacked merit:
{¶20} “By the beginning of December [2015], it was clear that there was no
evidence that plaintiff had requested or taken FMLA thus rendering her claim of unlawful
FMLA retaliation as baseless. * * * There was no evidence that she was disabled or
perceived as disabled. * * * There was simply no evidence she was terminated for
claiming workers compensation benefits that ended ten months earlier. She had
received workers compensation benefits for eight years with no problems from
defendants. * * * [Keith-Harper] never testified that she was directly targeted because of
her age. Creagh testified that she was more than forty years old herself. At this point in
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discovery, defendants turned over a considerable amount of material documenting
plaintiff’s declining performance and disciplinary actions for insubordination, violation of
hospital protocol and unsatisfactory performance. The evidence showing she was
terminated for just cause is overwhelming. * * * With respect to plaintiff’s claim of
intentional infliction of emotional distress, there was no evidence that defendants
exceeded their legal right to criticize and correct plaintiff’s work.
{¶21} “* * * The first deposition of plaintiff was completed by the end of
November 2014 and Creagh’s deposition was completed on December 11, 2014.
These depositions essentially refuted plaintiff’s allegations. After this court granted
several extensions, Spitz filed a brief in opposition to summary judgment * * * and later
* * * submitted a monetary demand to defendants of $72,500. * * * Pending this court’s
decision on their motion for summary judgment, defendants filed a trial brief and a
motion to bifurcate the trial and defendants prepared for trial. * * * this court awarded
summary judgment * * * well after defendants had commenced preparations for trial.”
{¶22} The trial court further explained that defense counsel asked one of
plaintiff’s attorneys to dismiss the suit in light of the lack of evidence after the plaintiff’s
first deposition, but Spitz did not do so. The trial court further noted in its decision: “At
this point, discovery was essentially completed * * *.” Thus, appellees were forced to
move for summary judgment, which was aggressively opposed, but ultimately granted in
appellees’ favor.
{¶23} The standard of review employed by an appellate court when reviewing
rulings on R.C. 2323.51 motions varies and is contingent upon the basis for the trial
court's decision. Groves v. Groves, 10th Dist. Franklin No. 09AP-1107, 2010-Ohio-
4515, ¶18, abrogated on other grounds by Jacobson v. Kaforey, 149 Ohio St.3d 3985
(2016). Our standard of review here is mixed. Crooks v. Consolidated Stores Corp.,
10th Dist. Franklin No. 98AP-83, 1999 WL 52981, *9-10 (Feb. 4, 1999).
{¶24} The trial court’s initial decision that Spitz’s conduct was frivolous is a
factual determination, which we will not disturb where the trial court’s findings are
supported by competent, credible evidence. Id. However, the decision to assess a
penalty for frivolous conduct lies within the trial court’s discretion, and as such, we
review its decision to impose sanctions for an abuse of discretion. Stevenson v.
Bernard, 11th Dist. Lake No. 2006-L-096, 2007-Ohio-3192, ¶39; State ex rel DiFranco
v. South Euclid, 144 Ohio St.3d 571, 2015-Ohio-4915, 45 N.E.3d 987, ¶13
{¶25} “‘[T]he term “abuse of discretion” is one of art, connoting judgment
exercised by a court, which does not comport with reason or the record.’ State v.
Underwood, 11th Dist. No. 2008-L-113, 2009 Ohio 2089, ¶30, citing State v. Ferranto,
112 Ohio St. 667, 676-678, 3 Ohio Law Abs. 187, 3 Ohio Law Abs. 332, 148 N.E. 362(1925). * * * where the issue on review has been confined to the discretion of the trial
court, the mere fact that the reviewing court would have reached a different result is not
enough, without more, to find error.’” [State v. Beechler, 2d Dist. No. 09-CA-54, 2010-
Ohio-1900,] ¶67.” Ivancic v. Enos, 2012-Ohio-3639, 978 N.E.2d 927, ¶70 (11th Dist.).
{¶26} Thus, absent a clear abuse of discretion, i.e., a finding that the trial court
failed “to exercise sound, reasonable, and legal decision-making[,]” this court must
affirm. Id.{¶27} A motion for sanctions under R.C. 2323.51 requires a three-step
determination. First, did an individual engage in frivolous conduct. Second, if the
conduct was frivolous, was another party adversely affected by the frivolous conduct.
And third, the amount of award, if any. Tipton v. Directory Concepts, Inc., 5th Dist.
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Richland No. 13CA61, 2014-Ohio-1215, ¶32, citing Ferron v. Video Professor Inc., 5th
Dist. Delaware No. 08-CAE-09-0055, 2009-Ohio-3133.
{¶28} In Stevenson v. Bernard, 11th Dist. Lake No. 2006-L-096, 2007-Ohio-
3192, this court upheld an award of Civ.R. 11 sanctions against an attorney who lacked
a factual basis for filing a slander complaint against two other attorneys. Plaintiff’s
counsel refused to dismiss the suit even after the plaintiff admitted that the factual basis
for the complaint was untrue and in spite of requests from defense counsel to dismiss.
We affirmed the trial court’s decision finding that counsel’s decision to file suit based
only on assumptions and suspicions of slander, without any investigation as to the truth
of the allegations, was willfully frivolous conduct.
{¶29} In this case, the trial court found objectively frivolous conduct and satisfied
all three R.C. 2323.51 prongs. It determined that Spitz engaged in frivolous conduct
when it continued to pursue Keith-Harper’s claims after the depositions of Keith-Harper
and Creagh established that the complaint lacked merit. The trial court found appellees
were adversely affected based on Spitz’s continued pursuit of the claims in spite of the
lack of evidence to support each. It found that appellees incurred trial preparation costs
as well as the costs associated with pursuing its motion for summary judgment after the
discovery process revealed that the claims lacked evidentiary support under R.C.
2323.51(A)(2)(a)(iii). Finally, the trial court found Attorney Brian D. Spitz and the Spitz
Law Firm, LLC jointly and severally liable for the $22,926.72 award.
{¶30} Based on the foregoing, the trial court’s finding that Spitz’s continued
pursuit of Keith-Harper’s claims after the depositions of the key witnesses was frivolous
conduct under R.C. 2323.51(A)(2)(a)(iii) was supported by competent, credible
evidence, and its decision to impose sanctions is not an abuse of discretion. See
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Engintec Corp. v. Miller, 11th Dist. Trumbull No. 2008-T-0091, 2010-Ohio-3680, ¶34
(finding no abuse of discretion since the trial court was in the best position to evaluate
witness credibility and determine if plaintiff’s conduct throughout the underlying
proceedings was frivolous). The trial court exercised sound, reasonable, and legal
decision-making in rendering its detailed decision, and as such, Spitz’s first and second
assigned errors are overruled.
{¶31} Spitz’s third assigned error asserts:
{¶32} “As R.C. 2323.51 does not allow sanctioning of law firms, the trial court
committed reversible error in sanctioning the Spitz Law Firm.” Spitz claims the trial
court acted without authority and contrary to law upon finding the Spitz Law Firm, LLC
jointly and severally liable for the R.C. 2323.51 award in appellees’ favor. First, Spitz
did not raise this argument to the trial court, and as such, the issue is waived absent a
finding of plain error. “[I]n a civil case, the doctrine of plain error will be applied only in
the ‘extremely rare case involving exceptional circumstances where error, to which no
objection was made at the trial court, seriously affects the basic fairness, integrity, or
public reputation of the judicial process, thereby challenging the legitimacy of the
underlying judicial process itself.’” S & P Lebos, Inc. v. Ohio Liquor Control Comm., 163
Ohio App.3d 827, 2005-Ohio-5424, 840 N.E.2d 1108, ¶12 (10th Dist.) quoting Goldfuss
v. Davidson (1997), 79 Ohio St.3d 116, 122–123, 679 N.E.2d 1099.
{¶33} Furthermore, R.C. 2323.51(B)(4) authorizes “[a]n award * * * against a
party, the party’s counsel of record, or both.”
{¶34} Several courts have upheld a R.C. 2323.51 award against a law firm and
have not differentiated between the law firm and the individual attorney employed by it
as counsel of record. Master v. Chalko, 8th Dist. Cuyahoga No. 75973, 2000 Ohio App.
8LEXIS 2014, at *1 (May 11, 2000) (affirming award of attorney fees against executor
and law firm, jointly and severally, under R.C. 2323.51); Lewis v. Celina Financial Corp.,
101 Ohio App.3d 464, 655 N.E.2d 1333 (3d Dist.1995).
{¶35} In Riley v. Langer, 95 Ohio App.3d 151, 642 N.E.2d 1 (1st Dist.1994) rev’d
on other grounds by Riston v. Butler, 149 Ohio App.3d 390, 2002-Ohio-2308, 777
N.E.2d 857 (1st Dist.), the First Appellate District considered a comparable argument
and found although a law firm cannot be held responsible for an award of attorney fees
under Civ.R. 11, it can be found liable under R.C. 2323.51. Riley based its decision on
Pavelic & LeFlore v. Marvel Entertainment Group, 493 U.S. 120, 110 S.Ct. 456 (1989),
which held that a law firm cannot be held accountable based on Fed.R.Civ.P. 111 since
it imposes a non-delegable duty on the individual attorney who signs the pleading, and
not his law firm, for his or her failure to ensure the “truth and legal reasonableness of
the papers filed * * *.” Id. at *163. This rationale does not apply to R.C. 2323.51. Id.
{¶36} Unlike Ohio Civ.R. 11, R.C. 2323.51 was not drafted to impose
responsibilities and sanctions on individual attorneys signing pleadings, but was
designed to afford an avenue of relief to a party adversely affected by frivolous conduct.
Ferron v. Video Professor, Inc., 5th Dist. Delaware No. 08-CAE-09-0055, 2009-Ohio-
3133, ¶69.
{¶37} Here, appellees’ motion for an award of attorney fees requested attorney
fees against both Attorney Brian D. Spitz and the Spitz Law Firm, LLC. Thus, the firm
was on notice that the claim was against it as well as individually against Attorney Spitz.
Accordingly, we find no plain error in the trial court’s decision holding the Spitz Law Firm
1. Fed.R.Civ.P. 11 has since been amended and subsection Fed.R.Civ.P. 11(c)(1) now specifically allows
the imposition of a sanction on the law firm as well an individual attorney.
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jointly and severally liable with Attorney Brian Spitz for the R.C. 2323.51 award. Spitz’s
third assigned error is overruled.
{¶38} Spitz’s fourth assigned error asserts,
{¶39} “The trial court committed reversible error by holding that appellees were
adversely affected by having to pay standard defense costs.”
{¶40} Spitz claims the trial court never addressed how appellees were adversely
affected by its frivolous conduct and claims that appellees simply incurred “normal
defense costs” to defend the suit. We disagree. The trial court found in part:
{¶41} “The court finds that Spitz’s conduct after December 16, 2014 met the
criteria of frivolous conduct under R.C. 2323.51(A)(2) in that plaintiff’s allegations or
other factual contentions had no evidentiary support and were not likely to have
evidentiary support particularly after the first deposition of Keith-Harper which failed to
provide evidence supporting her claims. Defendants’ lead attorney * * * immediately
after the deposition, * * * contacted * * * an attorney then working for Spitz Law Firm,
and asked her to dismiss the lawsuit. This was not done.”
{¶42} Thereafter, appellees filed their motion for summary judgment, opposed
Spitz’s motions to extend the deadline, filed a reply brief to plaintiff’s motion in
opposition, and also began preparing for trial filing a trial brief and a motion to bifurcate.
Spitz likewise submitted a settlement demand after the unfavorable deposition
testimony. The trial court did not issue its summary judgment decision until May 27,
2015, 20 days before trial was scheduled.
{¶43} Thus, the trial court found that Spitz’s continued pursuit of Keith-Harper’s
claims after the key discovery depositions adversely affected appellees. The trial court
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did not award attorney fees for the entirety of the case. Spitz’s fourth assigned error
lacks merit.
{¶44} Spitz’s fifth assignment of error asserts:
{¶45} “The alleged billing records were not properly before the trial court.”
{¶46} Spitz argues that appellees’ defense firm’s billing invoices were not
formally submitted or admitted into evidence at the sanction hearing. The billing
invoices, marked as defendant’s exhibit 1, were introduced and identified as the monthly
billing invoices Lake Hospital System, Inc. received from the law firm of Brennan,
Manna & Diamond, LLC in defending the Keith-Harper lawsuit. Although the written
record does not reflect that this exhibit was offered or admitted into evidence at the
hearing, the official court reporter indicates in her certification that defendant’s exhibit 1
was admitted into evidence and is to be included with the official hearing transcript of
proceedings. The trial court also relies on the invoices in its decision.
{¶47} “It is well-established that the admission or exclusion of relevant evidence
rests within the sound discretion of the trial court. State v. Robb (2000), 88 Ohio St.3d
59, 68, 723 N.E.2d 1019, quoting State v. Sage (1987), 31 Ohio St.3d 173, 510 N.E.2d
343, paragraph two of the syllabus. Absent an abuse of discretion, as well as a
showing that the accused has suffered material prejudice, an appellate court will not
disturb a ruling by a trial court as to the admissibility of evidence. State v. Martin
(1985), 19 Ohio St.3d 122, 129, 483 N.E.2d 1157.” Abetew v. Denu, 10th Dist. Franklin
No. 01AP-87, 2002-Ohio-628, *7.
{¶48} A hospital representative as well as one of the partners of the law firm
identified the invoices during testimony as reflecting the total litigation expenses the
hospital incurred in defending Keith-Harper’s suit. They both verified the total amount of
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defense costs incurred was approximately $65,000. The hospital’s vice president of
human resources confirmed that he reviewed these billing statements upon receipt and
authorized their payment.
{¶49} Further, Attorney Congeni confirmed his firm’s hourly rates, explained that
these costs were directly related to the defense of Keith-Harper’s complaint, and verified
that he reviewed each monthly statement before it was mailed to the hospital. Congeni
stated that his firm’s fees and expenses were reasonable and necessary.
{¶50} Spitz attempted to point out minor conflicts in the defense billing
statements, but did not introduce evidence generally challenging the amount or
reasonableness of the firm’s billing statements as a whole. Spitz never argued that the
defense bills were unnecessary or that the amount was unreasonable. Spitz likewise
did not submit evidence disputing the veracity or authenticity of the billing statements.
Thus, absent a showing of material prejudice, we cannot find the trial court abused its
discretion in relying on defendant’s exhibit 1 in fashioning its award. Spitz’s fifth
assignment is overruled.
{¶51} Spitz’s final assignment of error alleges:
{¶52} “The trial court erred when it improperly awarded fees charged by law
clerks and staff.”
{¶53} Spitz argues the trial court erroneously included appellees’ defense firm’s
law clerk and staff time in its R.C. 2323.51 award. Spitz complains that the statute only
permits an award for attorney fees and does not authorize the payment of law clerk and
other staff time. We disagree.
{¶54} R.C. 2323.51 clearly authorizes a “motion for an award of court costs,
reasonable attorney’s fees, and other reasonable expenses incurred in connection with
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the civil action or appeal * * *.” (Emphasis added.) Thus, assuming the trial court’s
award in this case included time billed for defense counsel’s law clerk and other staff
members’ time billed for time spent in defending Keith-Harper’s claims, there is no error
since the same constitutes “other reasonable expenses.” All Climate Heating & Cooling
v. Zee Props., 10th Dist. Franklin No. 01AP-784, 2002 Ohio App. LEXIS 1951, at *18-20
(Apr. 25, 2002), citing Ron Scheiderer & Assocs. v. City of London, 12th Dist. Madison
Nos. CA95-08-022, CA95-08-024, 1996 Ohio App. LEXIS 3296, at *19 (Aug. 5, 1996)
affirmed (1998), 81 Ohio St.3d 94.
{¶55} Accordingly, Spitz’s final argument lacks merit, and the judgment of the
Lake County Court of Common Pleas is affirmed.
TIMOTHY P. CANNON, J., concurs,
COLLEEN MARY O’TOOLE, J., dissents with a Dissenting Opinion.
____________________
COLLEEN MARY O’TOOLE, J., dissents with a Dissenting Opinion.
{¶56} I respectfully dissent.
{¶57} “Generally, a reviewing court will not reverse a trial court’s decision to
impose sanctions for frivolous conduct absent an abuse of discretion.” Drummond v.
Genoa Banking Co., 6th Dist. Ottawa No. OT–97–008, 1998 WL 102144, *3. Regarding
this standard, this writer recalls the term “abuse of discretion” is one of art, connoting
judgment exercised by a court which neither comports with reason, nor the record. State
v. Ferranto, 112 Ohio St. 667, 676–678 (1925). An abuse of discretion may be found
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when the trial court “applies the wrong legal standard, misapplies the correct legal
standard, or relies on clearly erroneous findings of fact.” Thomas v. Cleveland, 176 Ohio
App.3d 401, 2008-Ohio-1720, ¶15 (8th Dist.).
{¶58} The trial court found that Attorney Spitz’s conduct, after appellees filed
their motion for summary judgment, met the criteria under R.C. 2323.51(A)(2) and that
the “allegations or other factual contentions had no evidentiary support...” The trial
court went on to note that the allegations “were not likely to have evidentiary support
particularly after the first deposition of Keith-Harper which failed to provide evidence
supporting her claims.” (Emphasis added).
{¶59} However, this writer is constrained to ask: If it was clear after the first
deposition of Keith-Harper that her claims were without merit—why did appellees, as
the docket and billing records clearly show, schedule and take a second deposition two
months after filing their summary judgment motion?
{¶60} Appellees filed their motion for sanctions claiming that no reasonable
attorney would have pursued this case. The trial court agreed and held that after the
filing of summary judgment—and in particular after the first deposition of Keith-Harper—
it was clear that these claims could not be sustained. Again, if it was so clear—why was
a second deposition of Keith-Harper taken by appellant after the motion for summary
judgment had been filed?
{¶61} By taking this second deposition appellees clearly demonstrated that they
were not certain that they would prevail on their summary judgment motion. Why would
an attorney terminate a case, possibly prejudicing their client, when the actions of the
opposing party demonstrate their concern that the matter will go to trial? Would not an
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attorney be risking a malpractice claim by dismissing a case under these
circumstances?
{¶62} Is there any other conclusion to draw in this matter other than Attorney
Spitz was damned if he did and damned if he didn’t? It appears from the record that
each attorney acted within the bounds of properly representing their client. Such
actions do not give rise to sanctions.
{¶63} Given all this, it is clear that the imposition of sanctions by the trial court in
this matter does not comport with reason or the record.
{¶64} I respectfully dissent.
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