Eric M. Berman, P.C. v. City of N.Y., 13–598.
| Decision Date | 29 October 2014 |
| Docket Number | No. 13–598.,13–598. |
| Citation | 770 F.3d 1002 |
| Parties | ERIC M. BERMAN, P.C., Lacy Katzen, LLP, Plaintiffs–Appellees, v. CITY OF NEW YORK, New York City Council, New York City Department of Consumer Affairs, Jonathan Mintz, in his official capacity as the Commissioner of the New York City Department of Consumer Affairs, Defendants–Appellants.. |
| Court | U.S. Court of Appeals — Second Circuit |
OPINION TEXT STARTS HERE
Defendants–Appellants City of New York, New York City Council, New York City Department of Consumer Affairs, and Jonathan Mintz appeal from a judgment of the United States District Court for the Eastern District of New York (Eric N. Vitaliano, J.), entered on February 14, 2013, which granted in part Plaintiffs–Appellees Eric M. Berman, P.C. and Lacy Katzen, LLP's motion for summary judgment. The district court judgment declared, in pertinent part, that New York City's Local Law 15, which regulates the debt collection agencies, was void as applied to Plaintiffs, which are law firms that seek to collect debts. Because this case raises unresolved and significant issues concerning the scope of New York State's regulatory authority over attorneys, we certify two questions to the New York Court of Appeals.
Janet L. Zaleon, Assistant Corporation Counsel (Michael A. Cardozo, Corporation Counsel of the City of New York, Kristin M. Helmers, Nicholas R. Ciappetta, on the brief), New York, NY, for Defendants–Appellants.
Max S. Gershenoff, Rivkin Radler, LLP (Evan H. Krinick, Cheryl F. Korman, Michael P. Versichelli, on the brief), Uniondale, NY, for Plaintiffs–Appellees.
Carolyn E. Coffey, MFY Legal Services, Inc., New York, NY; Theodora Galacatos, Feerick Center for Social Justice, New York, NY; Claudia Wilner, New Economy Project, Inc., New York, NY, counsel for amici curiae in support of Defendants–Appellants.
Before: POOLER, PARKER, and CHIN, Circuit Judges.
Defendants–Appellants City of New York, New York City Council, New York City Department of Consumer Affairs, and Jonathan Mintz (collectively, “Defendants” or “New York City”) appeal from a judgment of the United States District Court for the Eastern District of New York (Eric N. Vitaliano, J.), entered on February 14, 2013, which granted in part the motion for summary judgment filed by Plaintiffs–Appellees Eric M. Berman, P.C. and Lacy Katzen, LLP (collectively, “Plaintiffs”). The district court declared, in pertinent part, that New York City's Local Law 15, which regulates debt collection agencies, was void as applied to Plaintiffs, which are law firms that seek to collect debts. Because this case raises unresolved and significant issues concerning the scope of New York State's regulatory authority over attorneys, we certify two questions to the New York Court of Appeals.
In 1984, New York City passed Local Law 65, which regulated debt collection agencies. That law, among other things, required debt collection agencies to obtain a license prior to engaging in debt collection activities. The law excluded from its definition of debt collection agencies “any attorney-at-law collecting a debt as an attorney on behalf of and in the name of a client.” App'x at 166.
In 2007, a member of the New York City Council introduced a bill to amend Local Law 65. As one of its proposed changes, the amendment sought to clarify which attorneys and law firms were exempt from the licensing requirement and which would come within the definition of debt collectors. A hearing was held on the bill, at which councilpersons and others testified. In response to testimony at the hearing, the previously proposed bill was amended. The City Council's Committee on Consumer Affairs released a report that discussed how the amended bill sought to address concerns regarding the effects of consumer debt on the residents of New York City and the manner in which such debt is collected.
The amended bill was passed by the City Council, signed by the Mayor, and became Local Law 15. Among other things, Local Law 15 changed the definition of “debt collection agencies,” stating that the term does not include:
any attorney-at-law or law firm collecting a debt [as an attorney] in such capacity on behalf of and in the name of a client solely through activities that may only be performed by a licensed attorney, but not any attorney-at-law or law firm or part thereof who regularly engages in activities traditionally performed by debt collectors, including, but not limited to, contacting a debtor through the mail or via telephone with the purpose of collecting a debt or other activities as determined by rule of the commissioner.
N.Y.C., N.Y., Code § 20–489(a)(5) (). Local Law 15 also brought within the definition of debt collection agency:
a person engaged in business the principal purpose of which is to regularly collect or attempt to collect debts owed or due or asserted to be owed or due to another and shall also include a buyer of delinquent debt who seeks to collect such debt either directly or through the services of another by, including but not limited to, initiating or using legal processes or other means to collect or attempt to collect such debt.
Id. § 20–489(a) ().
Local Law 15 did not amend the licensing requirement for debt collection agencies. However, it did create new mandatory debt collection practices for those agencies, proscribe certain practices, and establish new penalties.
Plaintiffs are law firms that attempt to collect debts. They brought this action seeking, among other remedies, a declaratory judgment that Local Law 15 violates Article IX of the New York Constitution, the New York Municipal Home Rule Law, the New York Judiciary Law, and the New York City Charter. Plaintiffs allege that “it is the New York State Judiciary, not municipal governments, that has the sole authority to regulate attorney admissions, practice, and conduct.” App'x at 22, ¶ 41.
The parties cross-moved for summary judgment, and the district court granted each motion in part and denied each motion in part. Of particular relevance to this opinion, the district court granted Plaintiff's motion for summary judgment on their claim that Local Law 15 conflicted with the State's authority to regulate attorneys, and was without force and effect as to Plaintiffs. The district court also granted summary judgment for Plaintiffs on their claim that Local Law 15 violated a provision of the New York City Charter by purporting to provide the City with the effective authority to grant or withhold licenses to practice law, which is a function reserved to the State. Defendants appeal that summary judgment decision.
“We review the district court's grant of summary judgment de novo, applying the same standards that govern the district court's consideration of the motion.” Summa v. Hofstra Univ., 708 F.3d 115, 123 (2d Cir.2013) (internal quotation marks omitted).
“The regulations of the New York Court of Appeals permit that Court, in its discretion, to entertain dispositive questions certified to it for resolution.” Beardslee v. Inflection Energy, LLC, 761 F.3d 221, 228 (2d Cir.2014). There are three inquiries we undertake before certifying a question:
(1) whether the New York Court of Appeals has addressed the issue and, if not, whether the decisions of other New York courts permit us to predict how the Court of Appeals would resolve it; (2) whether the question is of importance to the state and may require value judgments and public policy choices; and (3) whether the certified question is determinative of a claim before us.
Id. (internal quotation marks omitted). Our Local Rules provide us with authority to certify questions to the New York Court of Appeals. See Local Rule 27.2(a) of the Local Rules of the United States Court of Appeals for the Second Circuit.
“Broadly speaking, State preemption occurs in one of two ways—first, when a local government adopts a law that directly conflicts with a State statute and second, when a local government legislates in a field for which the State Legislature has assumed full regulatory responsibility.” DJL Rest. Corp. v. City of New York, 96 N.Y.2d 91, 725 N.Y.S.2d 622, 749 N.E.2d 186, 190 (2001) (citations omitted). In this case, the district court concluded that Local Law 15 was “in direct conflict with New York Judiciary Law §§ 53 and 90.” Berman v. City of New York, 895 F.Supp.2d 453, 469 (E.D.N.Y.2012). It did not consider whether those provisions of the State's Judiciary Law rendered Local Law 15 invalid under the doctrine of field preemption.
Section 53 of the New York Judiciary Law provides the New York Court of Appeals with the authority to make rules concerning the admission of attorneys to practice law. For example, it states: “The court of appeals may from time to time adopt, amend, or rescind rules not inconsistent with the constitution or statutes of the state, regulating the admission of attorneys and counsellors at law, to practice in all the courts of record of the state.” N.Y. Judiciary Law § 53(1).
Section 90 of the New York Judiciary Law generally provides New York courts with the power to regulate the practice of law, stating:
The supreme court shall have power and control over attorneys and counsellors-at-law and all persons practicing or assuming to practice law, and the appellate division of the supreme court in each department is authorized to censure, suspend from practice or remove from office any attorney and counsellor-at-law admitted to practice who is guilty of professional misconduct, malpractice, fraud, deceit, crime or misdemeanor, or any conduct prejudicial to the administration of justice;...
To continue reading
Request your trial