A ruling in the never-ending Charles Oakley-Madison Square Garden court dispute shows the lengths the well-heeled antagonists have been willing to go to prove a point.
U.S. Magistrate Judge Robyn F. Tarnofsky last week ordered Oakley, the retired New York Knicks star, to pay Madison Square Garden Networks—which Oakley is suing over his forced removal from a seat at a Knicks home game in 2017—approximately $642,000 in attorneys’ fees and costs relating to the deletion of all text messages sent to or from Oakley’s phone prior to February 2022.
This ruling is a reminder that the case stems from a game ticket that most likely cost hundreds, or perhaps thousands, of dollars. Now, it has generated millions of dollars in attorneys’ fees as two wealthy men—61-year-old Oakley and 70-year-old MSG chairman James Dolan—pursue a longstanding personal feud in federal court.
This ruling is also a reminder that under the Federal Rules of Civil Procedure, parties in litigation have a legal obligation to preserve evidence—including texts and other data from phones—related to claims and defenses. When parties fail to undertake reasonable efforts to preserve evidence, they can be issued what are known as “spoliation sanctions.”
Those sanctions can range from the judge terminating the case, or requiring the party found in violation to pay the other side’s attorneys’ fees and costs related to the violation—which is the case here.
Oakley contends MSG security assaulted and battered him by forcing him to leave his seat, while MSG says Oakley yelled obscenities in front of children, assaulted and battered MSG security, and refused to leave his seat when asked.
The subtext to the litigation is Oakley’s personal grievance against Dolan, whom the ex-player has long criticized, in part for slighting him compared to other Knicks legends. The fact that litigation over being kicked out of an otherwise forgettable Knicks game is now in its ninth year highlights the personal, rather than economic, factors driving the two men.
Thousands of texts were lost when Oakley traded in his phone. MSG contends that AT&T, Oakley’s mobile carrier, revealed that Oakley sent and received 7,770 texts during the three weeks after the seat removal. Some of those texts might shed light on what happened during the seat removal and Oakley’s state of mind regarding the incident. The deletion of those texts might therefore hurt MSG’s ability to wage an effective defense.
Last December, Oakley testified he didn’t know he had to preserve his texts and that his attorneys hadn’t told him to do so. To try to mitigate the lost texts, Oakley provided MSG with a list of people he “may have texted about the events of Feb. 8, 2017,” and said MSG could try to find missing texts by using subpoenas. For MSG, that mitigation fell far short of repairing the problem, and it argued that the case should be terminated.
In July, U.S. Circuit Judge Richard J. Sullivan granted MSG’s spoliation motion, though declined to impose the demanded remedy of case-ending sanctions. He instead ruled that if the case goes to trial, MSG can tell the jury about the spoliation and jurors would be told they can draw an inference adverse to Oakley on account of the deleted texts. Sullivan also ruled Oakley must pay MSG’s reasonable attorneys’ fees and costs in seeking the spoliation motion and “pursuing discovery related to Oakley’s loss of text messages.”
The relevant question for Tarnofsky is how much Oakley should have to pay.
MSG contends it is owed approximately $1.5 million in fees and costs. MSG lists, among other expenses, money spent on attorneys appearing in court multiple times for the spoliation motion, drafting numerous legal documents, preparing subpoenas and hiring a computer forensics expert.
Oakley insists the amount he should pay is much lower—either $0 or no more than $45,538 in fees and costs. Oakley argues, among other things, that MSG’s attorneys’ hourly rates “are unreasonable” and that MSG relied on senior attorneys for relatively unsophisticated work that junior attorneys or paralegals could have performed at much lower billable hour rates.
On balance, Tarnofsky found MSG’s arguments more persuasive. The judge rejected Oakley’s assertion that the hourly rates are too high on account of the lawyers being overqualified. She noted that the case began as a more “complex commercial litigation” that, over years and through appeals, has effectively shrunk in scope to a basic torts case, but that “it would have been inefficient” for MSG “to switch lawyers.”
Tarnofsky also pointed out the factual issues involved “analysis of thousands of pages of AT&T records.”
MSG attorneys’ hourly rates “are on the high side,” Tarnofsky suggested, but still roughly comparable to the rates at similarly sized firms in New York City. MSG’s attorneys at the firm included now-New York City Deputy Mayor Randy Mastro, a former federal prosecutor and partner at King & Spalding whose clients over the years have included Chevron, AIG, Amazon and other large businesses. Mastro, who became deputy mayor in March, billed at $1,709 an hour, the highest rate of the attorneys involved.
Regarding the amount of work—and number of billable hours—performed by MSG’s attorneys and other litigation support personnel, Tarnofsky concluded they were appropriate and not excessive. She wrote she agreed with MSG that Oakley’s “behavior—including his lack of cooperation in obtaining the deleted messages and incorrect statements about his texting patterns and timing of and reasons for his phone upgrades”—made the situation worse for MSG. She also faulted Oakley’s attorneys for “providing incorrect information to [MSG] about [Oakley]’s cell carrier and type of phone and an incomplete list of individuals with whom Plaintiff texted.”
As to whether MSG “won” on the sanctions motion decided by Sullivan earlier this year, Tarnofsky found it was “largely successful.” Oakley portrayed MSG as unsuccessful since Sullivan didn’t dismiss the case, but Tarnofsky stressed that Sullivan agreed with MSG that spoliation occurred.
Tarnofsky was more persuaded by Oakley’s arguments regarding the hourly rate for paralegals and other professionals used by MSG. She determined they were too high and applied a $200 hourly rate as consistent with industry practices.
Tarnofsky also agreed with Oakley that MSG has relied on “impermissibly vague” time entries for some of the billable work. Attorneys and other professionals in law are expected to describe, in some detail, how they have used their billable time so that clients know what they’re paying for. Tarnofsky noted that Mastro—though he “clearly performed a significant quantum of work” for MSG—sometimes billed using ambiguous phrasing, such as “work on discovery regarding spoliation briefing” and “work on sanctions.” Another MSG attorney billed for “attending to” such tasks as “research” and “undefined coordination” that lacked measurable descriptions.
Tarnofsky reasoned these types of entries are “too vague” for her to assess “whether these entries provide sufficient information on the work performed to assess whether the tasks described are compensable and whether the time spent on them was reasonable.”
What’s not vague, based on the money spent thus far on lawyers: how the opposing parties feel about each other.