In yet another blow to certain plaintiffs and their attorneys who file multiple cases each year asserting violations of the Americans with Disabilities Act (“ADA”), a New York federal judge has stated firmly that enough is enough.

In Costello v. Flatman, LLC,¹ the plaintiff alleged an ADA violation because he was wheelchair-bound and unable to access a Subway restaurant. After awarding the plaintiff a default judgment in the sum of merely $14.31, Eastern District Judge Sterling Johnson refused to award attorneys’ fees. But the court did not stop there. In a sharply worded opinion, Judge Johnson stated, “The conduct of counsel is indicative of a parasite disguised as a social engineer. It must stop.” The court also put the plaintiff’s attorneys on notice that it would “not be shy about informing appropriate state bar authorities and chief judges across the country”  if the attorneys continue the same pattern of litigation. As a result, thousands of small business owners, particularly in the food and hospitality business, can look forward to 2014 with hope that they will not be ensnared in an ADA trap.

The court explained that the ADA “is a testament to this country’s effort to protect some of its most vulnerable citizens” – the disabled. To that end, the law was designed to provide disabled individuals with “equal and safe access to the same benefits and accommodations as every other American.” Specifically, under certain circumstances, the ADA requires the removal of structural barriers in public accommodations, such as restaurants, hotels and other retail businesses. The ADA also permits courts to award attorneys’ fees to a prevailing party. Many states have enacted similar laws to protect the disabled and, unlike the ADA, those state laws often permit a plaintiff to seek damages.

The story behind the $14 judgment

As a result of the potential for an award of damages under state law and the availability of attorneys’ fees under the ADA, Judge Johnson noted that the cases have spawned a “cottage industry” that is “less about ensuring access for those with disabilities and more about lining counsel’s pockets.” In explaining the tactics used in these cases, the court quoted from another federal case in which a plaintiff who had previously filed about 400 cases was required to obtain permission from the court before filing additional ADA lawsuits:

The scheme is simple: an unscrupulous law firm sends a disabled individual to as many businesses as possible, in order to have him aggressively seek out any and all violations of the ADA. Then, rather than simply informing a business of the violations, and attempting to remedy the matter through “conciliation and voluntary compliance,” … a lawsuit is filed, requesting damage awards that would put many of the targeted establishments out of business. Faced with the specter of costly litigation and a potentially fatal judgment against them, most businesses quickly settle the matter. ²

Against this background, the court in Flatman made several observations about the plaintiff and his allegations. The plaintiff filed seven other identical cases on the same day. All of the cases were against small businesses within two blocks of the Subway restaurant at issue. The plaintiff failed to appear in court on three occasions and his attorney was unable to provide the plaintiff’s telephone number, which led the court to doubt whether the plaintiff even existed, was wheelchair-bound and had actually visited any of the locations that were the subject of his complaints. Judge Johnson visited each of the eight businesses that were sued by the plaintiff and was “shocked” to see that most of the alleged structural problems claimed to prevent access to persons with  disabilities had not been remedied. The court therefore concluded that even if the plaintiff did exist, the lawsuits did not facilitate the intended goal of furthering equal access to the businesses for any other disabled person.

Even more disturbing, the court pointed out that many of the alleged violations of the ADA had not even existed in the first instance. As an example, the court noted the plaintiff’s allegation of Subway’s failure to have a wheelchair-accessible rest room, but the restaurant did not have a rest room at all.

The court used this example to shed light on “troubling litigation tactics” used by the plaintiff’s two attorneys and stated that the conduct is an arguable violation of the attorneys’ Rules of Professional Conduct. Undoubtedly, these tactics also strongly influenced the court’s decision to deny the attorneys’ fee application.

Another compelling factor was the amount of fees counsel requested for the time spent drafting the court papers. In this context, Judge Johnson made the observation that since 2009, the two attorneys representing the plaintiff had individually or together been listed as plaintiff’s counsel in 213 ADA cases in the Southern and Eastern Districts of New York. After finding that the papers were “practically identical” to the pleadings filed by these attorneys in other federal cases in New York and Florida, the judge characterized the request for fees for “drafting” as “disingenuous at best.”

Courts have cracked down on serial ADA plaintiffs since at least 2004, when a California federal court effectively barred a particularly egregious litigant. Absent legislative action, however, slowing the onslaught of these types of extortionate cases must be done incrementally, jurisdiction by jurisdiction. With the court’s decision in Flatman, we are now one step closer to the ADA serving its intended purpose by eliminating abusive practices that tend to bring small businesses to their knees.