United States District Court, D. Connecticut
RULING AND ORDER
N. Chatigny United States District Judge
Richard Freiberg brings this suit against defendants William
and Jonathan Stuart and their attorney, Sandra Akoury,
seeking damages for vexatious litigation. Freiberg prevailed
in a case the Stuarts brought against him while represented
by Attorney Akoury. In that underlying case, the Superior
Court granted summary judgment in favor of Freiberg, the
Appellate Court reversed, and the Supreme Court then upheld
the grant of summary judgment over a dissent. See Stuart
v. Freiberg, 116 A.3d 1195, 1197-98 (Conn. 2015).
Defendants have moved for summary judgment against Freiberg,
contending that the underlying suit against him was supported
by probable cause. William and Jonathan also rely on an
affirmative defense of advice of counsel. For reasons that
follow, the motions for summary judgment are granted.
Stuart Sr. created a living trust and will to benefit his
three sons, Kenneth, William and Jonathan. After his death,
his son Kenneth became the trustee of his estate and, in that
capacity, began sending financial summaries to William and
Jonathan. William and Jonathan soon realized that Kenneth had
created a limited partnership with their father and used it
to transfer estate assets to himself. Id.
¶¶ 5, 8. Attorney Akoury assisted them in bringing
suit against Kenneth for breach of fiduciary duty.
the suit was filed, Kenneth hired Freiberg, an accountant.
Id. ¶ 12. Freiberg prepared financial
statements and tax returns for Kenneth personally and for the
estate. Id. While providing services for the estate,
Freiberg realized that Kenneth was improperly paying personal
expenses and commingling his funds with estate funds.
Id. ¶ 14. Even so, he continued to prepare
financial statements for the estate and sent them to
beneficiaries of the estate, including William and Jonathan.
Id. ¶ 16-20. Freiberg does not dispute that his
reports were reviewed by Jonathan. It is also undisputed that
William and Jonathan spoke with Freiberg about his reports
and accounting work. William and Jonathan hired accountants
of their own, including a forensic accountant, to review
Freiberg’s reports. The forensic accountant found that
Freiberg had created a fictitious credit of $490, 755, which
suit against Kenneth was eventually successful, resulting in
an award of damages to the estate. William and Jonathan then
consulted with Attorney Akoury about the possibility of
bringing a suit against Freiberg for conspiring with Kenneth
or aiding and abetting his conversion of estate funds.
William and Jonathan subsequently authorized her to sue
Akoury filed a complaint against Freiberg in Connecticut
Superior Court asserting claims for fraud, negligent
misrepresentation, accountant malpractice and violations of
CUTPA. Freiberg moved for summary judgment on all the claims.
The Court granted the motion on the ground that William and
Jonathan could not prove they relied on Freiberg’s
accounting statements as they claimed. Stuart v.
Freiberg (“Stuart I”), No.
FSTCV0402005085, 2011 WL 3671904 (Conn. Super. Ct. July 15,
2011). The Appellate Court reversed on the ground that
genuine issues of material fact existed with regard to the
claims of fraud, negligent misrepresentation, and
malpractice. Stuart v. Freiberg (“Stuart
II”), 69 A.3d 320, 334 (Conn. App. Ct. 2013). The
Connecticut Supreme Court reversed, with one justice
dissenting. Stuart v. Freiberg (“Stuart
III”), 116 A.3d at 1197-98.
judgment may be granted when the movant “shows that
there is no genuine dispute as to any material fact and the
movant is entitled to judgment as a matter of law.”
Fed.R.Civ.P. 56(a). When the motion tests the
plaintiff’s ability to sustain his burden of proof at
trial, the movant can prevail by showing that the plaintiff
lacks evidence to support an element of his claim. To avoid
summary judgment, the plaintiff must point to evidence that
would support a verdict in his favor. Anderson v. Liberty
Lobby, Inc., 477 U.S. 242, 255 (1986). “[M]ere
conclusory allegations or denials” are not enough.
Podell v. Citicorp Diners Club, 112 F.3d 98, 101 (2d
prevail on his claim of vexatious litigation, Freiberg must
establish four elements: (1) a suit was brought against him,
(2) the suit lacked probable cause, (3) the suit was brought
with malice, and (4) the suit terminated in his favor.
See Falls Church Grp. v. Tyler, Cooper, and Alcorn,
LLP, 912 A.2d 1019, 1026-27 (Conn. 2007). Vexatious
litigation suits often turn on the element of probable cause.
This one is no exception.
cause “is the knowledge of facts sufficient to justify
a reasonable person in the belief that there are reasonable
grounds for prosecuting an action.” Id. at
1027. Reliance on advice of counsel is a complete defense
even when the advice was “unsound or erroneous.”
Evans v. Testa Dev. Assocs., No. CV01806425, 2002 WL
725483, at *3 (Conn. Super. Ct. Mar. 26, 2002) (quoting
Vandersluis v. Weil, 407 A.2d 982, 987 (Conn.
1978)). Reliance on the advice of counsel is an affirmative
defense with respect to which the defendant bears the burden
of proof. Verspyck v. Franco, 874 A.2d 249, 253
(Conn. 2005). The defendant must show that he relied on
advice of counsel “after a full and fair statement of
all facts within his knowledge, or which he was charged with
knowing.” Id. (quoting Vandersluis,
407 A.2d at 987).
argue that there is no genuine issue of material fact with
regard to whether probable cause existed to sue Freiberg on