French v. United States Fidelity & Guaranty Co.

• Decision Date: 13 January 1950
• Docket Number: Civ. No. 2302.
• Citation: 88 F. Supp. 714
• Parties: FRENCH et al. v. UNITED STATES FIDELITY & GUARANTY CO. et al.
• Court: U.S. District Court — District of New Jersey

88 F. Supp. 714

FRENCH et al. v. UNITED STATES FIDELITY & GUARANTY CO. et al.

Civ. No. 2302.

United States District Court D. New Jersey.

January 13, 1950.

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John Warren, Jersey City, N. J. (Adrian M. Unger and Sam Denstman, Newark, N. J., of counsel), for plaintiffs, Samuel T. French, Samuel T. French, Jr., Charles F. Haus, John J. Grogan, Harry Smith, Ralph Smith and Allan Hubbs.

Walter S. Keown, Camden, N. J., for plaintiff, Timothy G. Middleton.

Pitney, Hardin, Ward & Brennan, Newark, N. J., William J. Brennan, Jr., Newark, N. J., for defendants, London & Lancashire Indemnity Co. of America and others.

Toner, Speakman & Crowley, Newark, N. J., G. Dixon Speakman, Newark, N. J., for defendants, American Motorists Ins. Co. and others.

O'Mara, Conway & Schumann, Jersey City, N. J., Edward J. O'Mara, Jersey City, N. J., for defendants, Accident & Casualty Ins. Co. of Winterthur, Switzerland and others.

Edwards, Smith & Dawson, Jersey City, N. J., Allen C. Mathias, Jersey City, N. J., for defendant Security Mut. Casualty Co.

Thorn Lord, Newark, N. J., for defendant United States Fidelity & Guaranty Co.

Duggan, Shaw & Hughes, Newark, N. J., Edward L. Duggan, Newark, N. J., for defendants American Automobile Ins. Co. and Associated Indemnity Corporation.

FORMAN, District Judge.

These are motions by the defendants herein the general objectives of which are to dismiss certain counts of an amended and consolidated complaint, or in the alternative, to strike certain portions of the complaint and to compel more definite statement of its allegations or for a bill of particulars.¹ The plaintiffs for their part move to enjoin the defendants from pleading the statute of limitations.

The complaint, as amended and consolidated, is in eighteen counts. It alleges that the sixty-six defendant insurance companies² were or are members of the following unincorporated organizations: The Association of Casualty and Surety Companies, New York; National Bureau of Casualty and Surety Underwriters, now known as the National Bureau of Casualty Underwriters, of New York; and the American Mutual Alliance, of Chicago, Illinois.

Jurisdiction is founded upon diversity of citizenship and the amount in controversy exceeds $3,000, exclusive of interest and costs.

Count 1 further alleges that plaintiff, Samuel T. French, Senior (hereinafter called French, Sr.) has been a member of the bar of New Jersey since 1905, has maintained offices in the City of Camden, New Jersey, and that he developed a large and lucrative practice. That in and about the year 1934, the defendants conspired to cause him to be falsely indicted and convicted of crime; ruin him; disbar him; drive him from the practice of law; cause his clients to cancel retainers; cause prospective clients to refrain from retaining him; cause wrongful indictment of witnesses in legal actions of clients represented by him; cause such witnesses to refrain from testifying truthfully in such actions; induce such witnesses to swear falsely that they had testified untruthfully; injure his reputation; interfere with the administration of justice in the courts of New Jersey and of the United States; deny to his clients judgments to which they were entitled; falsely charge with crime lawyers employed by him, including his son, the plaintiff Samuel T. French, Jr. (hereinafter called French, Jr.); and otherwise impede, hinder, obstruct and defeat his advocacy of his clients' claims, with the intent to defeat and deny the constitutional and legal rights of him and his clients.

That in pursuance of the said scheme and conspiracy, defendants and their agents wilfully, maliciously, and without probable or justifiable cause committed the following acts: In 1934 organized the New Jersey Claim Investigation, a New Jersey corporation, as a shield to conceal the defendants from those injured by the conspiracy; bribed Thomas Morris and others, then employed by French, Sr., to act in a particular manner with respect to the professional business of French, Sr., and caused Morris to make a false affidavit and to testify falsely at the trial of the plaintiffs; caused Morris to be released from jail in the custody of one or more of the defendants, their agents, employees and attorneys and, by gifts, plying of liquor and the furnishing of a "lewd woman" induced Morris to make a false affidavit and to testify falsely at the trial of the plaintiffs; illegally intimidated, falsely arrested, confined, and interrogated witnesses, including plaintiffs herein, to various suits instituted by French, Sr. "by arrogating the functions of the Prosecutor of the Pleas of Camden County, by inducing a County Prosecutor's detective to act as their agent and servant to illegally take said witnesses from their homes and beds, sometimes after midnight and at divers other times, and to bring them to a private hotel suite occupied by Herbert H. Hargraves, president of the New Jersey Claim Investigation, causing said witnesses to believe that said action was in all respects legal and proper and, under false color of authority, process and right, then and there to permit said Hargraves to interrogate said witnesses, under threats of prosecution, before a public stenographer and prosecutor's detective, in an attempt to have them make false affidavits concerning the plaintiffs", to testify falsely concerning the plaintiffs, and "to illegally afford said Hargraves free and easy access to said witnesses and to interrogate them while they were confined in the County Jail, and to further intimidate and coerce the said witnesses and attempt to injure Samuel T. French and the other plaintiffs herein by promising said witnesses freedom from criminal prosecution or their release from jail if they would make such false affidavits and give such false testimony"; induced Eugene Murphy, a witness on behalf of the plaintiffs in civil cases then the subject of inquiry, to make a false affidavit and to testify falsely at the trial of the plaintiffs; through the said Hargraves, attempted to influence the Grand Jury of Camden County in its vote on indictments of the plaintiffs; and on or about May 5, 1938, with intent to injure French, Sr. and French, Jr. in their profession and other plaintiffs in their businesses, falsely, maliciously, wilfully, wickedly and without probable cause, charged the plaintiffs before the said Grand Jury with a conspiracy to cheat and defraud certain parties by instituting actions at law for damages and charged certain witnesses with falsely testifying. As a result, an indictment was returned against the plaintiffs and others on May 6, 1938.

That pursuant to the scheme and conspiracy defendants illegally obtained copies of "rogues gallery" photographs of French, Sr. and French, Jr. and exhibited them to clients of French, Sr. Trial of the plaintiffs was held in April 1939 and after a three weeks' trial the jury was discharged having failed to agree. After the trial the defendants urged the Prosecutor of the Pleas to retry the plaintiffs on the indictment. On September 25, 1941, the indictment against the plaintiffs was nolle prossed.

That pursuant to the conspiracy and scheme of the defendants, they filed charges against French, Sr. and French, Jr. with the Ethics Committee of the Camden County Bar Association and participated in the prosecution of these charges. After conducting an investigation of the charges, the Bar Association on February 27, 1942, dismissed them.

That pursuant to the scheme and conspiracy, the defendants originated the charges resulting in the indictment and those filed with the Bar Association, and actively participated in the prosecution of them. As a result the plaintiffs suffered physically and in their reputations and French, Sr., and French, Jr. were damaged in their profession. In defending himself against all the acts of the defendants, French, Sr. expended $5,000 and in this action seeks damages to the sum of $1,005,000.

Count 2 incorporates the allegations of Count 1 except for one paragraph and alleges that French, Jr. has been a member of the bar of New Jersey since 1935, that he had been employed by French, Sr. since then and that this plaintiff was damaged by the acts of the defendants for which he seeks damages totalling $1,000,000.

Count 3 incorporates portions of Count 1 and alleges that the aforesaid acts of the defendants resulted in the discharge of plaintiff Charles Haus from employment and that he was unable to secure re-employment "for a long time". This plaintiff seeks damages in the sum of $100,000.

Count 4 repeats the allegations of Count 3 and applies to plaintiff Timothy G. Middleton who seeks $300,000 damages.

Count 5 repeats the allegations of Count 3 and applies to plaintiff John Grogan who seeks $100,000 damages.

Count 6 repeats the allegations of Count 3 and applies to plaintiff Harry Smith who seeks $100,000 damages.

Count 7 repeats the allegations of Count 3 and applies to plaintiff Ralph Smith who seeks $100,000 damages.

Count 8 repeats the allegations of Count 3 and applies to plaintiff Allan Hubbs who seeks $300,000 damages.

Count 9 incorporates portions of Count 1. It further alleges that with intent to injure French, Sr. and French, Jr. in their profession and to injure the other plaintiffs herein the defendants charged the plaintiffs before the Camden County Grand Jury on May 5, 1938 with a criminal conspiracy to cheat certain persons by bringing false actions at law, and with having induced certain persons to swear falsely in the said actions, whereupon on May 6, 1938 an indictment was returned against the plaintiffs, the plaintiffs tried and the jury disagreed in April 1939. On September 25, 1941, the indictment was nolle prossed. The result of the defendants' actions was the injury to the plaintiffs' reputations, their physical sufferings, and French, Sr. and French, Jr. were injured in their profession....