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April 29, 2000


The opinion of the court was delivered by: McMAHON, J.:


This is the second action to be filed with this Court (and assigned to this judge) arising out of Plaintiff Ashok Kashelkar's dissatisfaction with the resolution of his legal affairs. In this first action, Kashelkar sued the judge, the law secretary and the lawyers who were involved in a personal injury suit that arose out of a car accident involving his son. That lawsuit was dismissed by the Rockland County Supreme Court, which dismissal was affirmed by New York's appellate courts. Mr. Kashelkar alleged that his constitutional right to due process was violated by the handling of his case, specifically by the granting of an adjournment over his objection. This Court dismissed Plaintiff's frivolous complaint, which alleged, inter alia, RICO violations and various constitutional torts. Kashelkar v. MacCartney, No. 99 Civ. 5132, 1999 WL 1295986 (S.D.N.Y. Dec. 22, 1999).

In this matter, Mr. Kashelkar has filed more or less the same complaint, this time against Household International, Inc., a Chicago-based holding company; two of its subsidiaries, Household Bank F.S.B. and Household Recovery Services; and Household's lawyers, the law firm of Rubin & Rothman LLC, as well as four of its current or former lawyers. Defendants' first sin was to sue Kashelkar to recover money he had borrowed from Household Bank under a line of credit. (Household Action No. 1.) Their second sin was to make a pleading error in that case, naming a banking product, rather than the lending institution itself, as the Plaintiff, which led to the voiding of a judgment entered against Kashelkar in that action. Their third was to have the misfortune to purchase a credit card debt that Kashelkar owed to Chemical Bank and to bring a suit to recover those funds. (Household Action No. 2.) They knew not with whom they were dealing.

Mr. Kashelkar's complaints against Defendants are difficult to discern on the face of his 119 page (with 141 pages of exhibits) Complaint — even to a Court familiar with Plaintiff's mode of pleading. As best the Court can understand his theory, it is that Household has sued to collect the money owed by Kashelkar because he is a member of a minority group (of South-Asian ancestry); that the naming of the wrong entity as the party Plaintiff in Household Action No. 1 constitutes RICO violations or frauds; and that the Rubin & Rothman Defendants conspired with a state judge (again!) in Household Action No. 1 to deny him the right to a trial in that case (in which he ultimately prevailed without the need for a trial). As these claims are no more substantial than the claims asserted in Plaintiff's prior action, for the reasons articulated by Defendants in their memorandum of law, the present claims, too, are dismissed with prejudice. As there is no conceivable basis on which Plaintiff could state a viable claim under the relevant Federal RICO, conspiracy and civil rights laws on the facts pleaded, Plaintiff's motion for leave to replead is also denied.


The following statement of facts is distilled from the Complaint and its exhibits.

The 1994 Action

In April 1991, Plaintiff received a conditional check in the mail from Household Bank in the amount of $1,500. (Cplt. ¶ 6 & Ex. P-01.) The check stated in writing that by executing and depositing it, "You accept our offer and agree to the terms and conditions of the HFC Cash Reserve Account Agreement Form 5537NY(4-91) which you received and read and which is incorporated herein by reference." (Cplt. Ex. P-06; Gershman Aff't Ex. 1.) A copy of the HFC Cash Reserve Account Agreement ("Cash Reserve Agreement") was enclosed with the check. (Cplt. Ex. P-06; Gershman Aff't Ex. 1.) The Cash Reserve Agreement provided, in pertinent part:

If you accept our HFC Cash Reserve Account offer, this Agreement will govern the terms and conditions of the Account. We want you to understand how your account works. Read this carefully and complete and sign our Account Opener in order to indicate your acceptance of the Account. . . .
AVAILABLE CREDIT. Your HFC Cash Reserve Account is a revolving line of credit through which you may obtain funds up to a credit limit we assign you.
PROMISE TO PAY. You promise to pay Household: (a) amounts borrowed under this Agreement; (b) Finance Charges, Administrative Charges (the late charge and bad check charge), and other charges provided in this Agreement; (c) insurance charges, if any; (d) collection costs permitted by applicable law, including reasonable attorneys' fees and court costs; and (e) amounts in excess of your credit limit that we may lend you, including Finance Charges.
VARIABLE RATE. You agree that the monthly periodic rate used in determining your Finance Charge will be a variable rate which may change from month to month. The monthly periodic rate will be one-twelfth of the sum of the Prime Rate plus 9.9 percentage points. (Cplt. Ex. P-06; Gershman Aff't Ex. 1.)

On May 16, 1991, Plaintiff endorsed and deposited the check in his bank account (Cplt. Ex. P-06; Gershman Aff't Ex. 1), thereby accepting Household Bank's offer to open an HFC Cash Reserve Account. (Cplt. ¶ 8.) Household Bank mailed Plaintiff a checkbook (Cplt. ¶ 11), which he used to draw on his line of credit by depositing checks in his bank account. (Cplt. Ex. P-06.) Household Bank thereafter sent Plaintiff monthly statements showing how much money he had borrowed, the interest rate, and what his minimum payment was for that month. (Cplt. ¶ 12.) For approximately two years, the arrangement appeared to work smoothly. Plaintiff drew on his line of credit from time to time by writing checks, received monthly statements, and made payments on the balance he owed. (Cplt. ¶ 13.)

At some point in 1993, Plaintiff fell behind in his payments (Cplt. ¶ 17), and Household Bank sent Plaintiff several letters and made a number of telephone calls asking him to resume payments. (Cplt. ¶¶ 15-17 & Ex. P-06.) In June of 1994, the law firm of Rubin & Rothman contacted Plaintiff on behalf of Household Bank by letter and telephone, asking that he contact the firm to discuss his outstanding debt. (Cplt. ¶ 20.) Rubin & Rothman sent Plaintiff a second letter on September 7, 1994. (Cplt. ¶ 22.) Plaintiff did not respond, and Household Bank then served a complaint signed by Robin Long, commencing an action in New York State Supreme Court in Rockland County to recover the $3200 Plaintiff owed Household Bank. (Cplt. ¶¶ 23-24 & Ex. P-05.)

In October 1994, Plaintiff filed an Answer and Counterclaim, and Household Bank replied in November 1994. (Cplt. ¶ 26.) On April 15, 1995, Household Bank served a motion for summary judgment. (Cplt. ¶ 28.) Plaintiff contends that service of this motion constituted a violation of his right to a trial. (Cplt. ¶ 47.) Plaintiff filed responsive papers and cross-moved for summary judgment. (Cplt. ¶¶ 37, 39, 53.) Household Bank opposed the cross-motion. (Cplt. ¶ 47.) On August 24, 1995, Justice Rudolph granted Household Bank's summary judgment motion and denied Plaintiff's cross-motion. (Cplt. ¶ 56.)

Plaintiff appealed Justice Rudolph's decision in September 1995. (Cplt. ¶ 59.) On October 10, 1995, Household Bank notified Plaintiff that it had obtained a judgment against him. (Cplt. ¶ 64.) On October 17, 1995, Household Bank served an Information Subpoena and Restraining Notices, signed by Keith Rothman, upon Chemical Bank and Bank of New York, the banks where Plaintiff maintained his personal and business banking accounts. (Cplt. ¶ 65.) Service of the restraining orders caused $2,600 in Plaintiff's three accounts to be frozen. (Cplt. ¶ 67.) Because his accounts were frozen, certain checks bounced. (Cplt. ¶ 68.) Plaintiff claims he was charged $15 for each bounced check, and that in total the banks charged him $450 in fees for bounced checks. (Id.)

Plaintiff claims that from April-June 1995, he was virtually precluded from working because he was devoting so much time to litigating the $3,200 action with Household Bank. (Cplt. ¶ 70.) Plaintiff further alleges that his inability to work, caused by his need to spend all of his waking hours preparing his defense, adversely affected his finances and precluded him from paying his automobile insurance premiums, which allegedly resulted in the cancellation of his insurance and the imposition of $360 in civil penalties by the New York State Department of Motor Vehicles. (Cplt. ¶¶ 70-71.)

Plaintiff claims that he was also adversely affected by the freezing of his bank accounts, which resulted in a brief interruption of the payment of his life, disability and health insurance premiums. (Cplt. ¶¶ 69, 74.) Plaintiff acknowledges that payment of his premiums had returned to normal by February 1996. (Cplt. ¶ 74.)

On March 6, 1996, Plaintiff filed an Order to Show Cause or a Motion to Vacate the Judgment, on the grounds that the complaint had incorrectly named the Plaintiff in the state court action. (Cplt. ¶¶ 95-97.) Because of an error in communication between Household Bank and Rubin & Rothman, the Plaintiff in the state court action was identified as HFC Cash Reserve Div. of Household Bank, F.S.B. (Cplt. ¶ 98 & Ex. P-36.) HFC Cash Reserve is a product provided by Household Bank, not a legal entity. (Cplt. Ex. P-36.) Household Bank filed a number of complaints around this time with the same infirmity. (See Cplt. ¶ 114 & Exs. P-37 and P-48.) On March 15, 1996, Household Bank acknowledged the error in papers submitted by Joseph Latona, and requested that the caption be amended to reflect the correct name of the entity to which Mr. Kashelkar owed money. (Cplt. ¶ 98 & Ex. P-36.) On May 3, 1996, Justice Rudolph ruled that the pleading error was jurisdictional, ordered that the judgment and the restraining orders be vacated, and stated that Household Bank was free to re-file the lawsuit with the correct name in the caption. (Cplt. ¶ 118 & Ex. ...

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