Brown v. Clark

UNITED STATES DISTRICT COURT

MIDDLE DISTRICT OF LOUISIANA

FANNIE BROWN CIVIL ACTION

VERSUS 18-1069-SDD-RLB

GERALDINE CLARK, ef al.

RULING

This matter is before the Court on the Motion to Issue Order to Show Cause! filed

by Defendant, Wright National Flood Insurance Company (“Wright National’). Plaintiff,

Fannie Brown (‘Plaintiff’) filed a Counter Motion In Opposition to Motion for

Miscellaneous Relief or Alternatively Motion to Dismiss Motion for Miscellaneous Relief,?

to which Wright a Reply.2 For the reasons that follow, Wright's Motion shall be

GRANTED,

I. FACTUAL AND PROCEDURAL BACKGROUND

This suit was filed by Plaintiff, Fannie B. Brown (‘Plaintiff’) against her insurer

seeking damages for an automobile accident occurring on January 15, 2017; she later

amended her complaint and added claims against her insurer arising out of damages

sustained to her home in the “Great Flood of 2016." Plaintiffs amended petition added -

Wright National Fiood Insurance Company (‘Wright’) as a defendant based on Plaintiffs

1 Rec. Doc. No. 430,

? Rec. Doc. No. 131.

3 Rec. Doc. No. 132.

4 Rec. Doc. No. 1, pp. 2-3.

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flood insurance policy.> On December 7, 2018, the case was removed to federal court.®

On January 31, 2019, the magistrate judge set a scheduling conference for

discovery, requiring the parties to make Rule 26(a)(1) disclosures no later than seven

days before the scheduling conference on January 31.’ Wright moved to compel

disclosures, which was unopposed by Plaintiff, so the Court granted Wright's motion to

compel Plaintiff to make Rule 26(a)(1) disclosures.’ Thereafter, Wright filed a motion for

fees and costs, claiming that the parties had conferred over the issue of the reasonable

amount of payment and were not able to reach an agreement on the payment of any

monies.? Wright submitted a declaration from its counsel alleging it incurred $636.50 in

attorney's fees.'° The Court ordered Plaintiff's counsel to pay that amount within 14 days

of its order dated August 7, 2019, pursuant to Rule 37(a)(5)(C) of the Federal Rules of

Civil Procedure."!

In response, Plaintiff filed a Motion for New Trial’? seeking review of the Magistrate

Judge’s Order; this Court denied Plaintiffs Motion for New Trial.1> Wright and Plaintiff

cross-moved for summary judgment.’4 The Court granted summary judgment in favor of

Wright!® and denied Plaintiff's motion for summary judgment.'® On August 19, 2020, this

§ fd. at p. 6.

7 Rec. Doc. No. 7, p.

® Rec. Doc. No. 38,

Doc. No. 48.

10 Rec. Doc. No. 48-2.

"1 Rec. Doc. No. 51, p. 3.

12 Rec. Doc. No. 55.

13 Rec. Doc. No. 88.

14 Rec. Doc. Nos. 90 & 98.

1S Rec. Doc. No, 113.

18 Rec. Doc. No. 114.

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Court entered judgment in favor of Defendants Liberty and Wright and dismissed

Plaintiff's claims with prejudice.

Pursuant to the judgment, Wright moved to tax costs against Plaintiff.18 Plaintiff

appealed the Court's Ruling and Judgment to the United States Court of Appeals for the

Fifth Circuit.'® The Fifth Circuit affirmed this Court’s judgment against Plaintiff and taxed

appellate costs against Plaintiff associated with the appeal.2° Considering the Mandate

from the Fifth Circuit and that no opposition to the taxation of costs had been filed, the

Court taxed costs against Plaintiff in the amount of $1,792.90.2'

Plaintiff moved to review the costs taxed against her.2 The Court reviewed the

motion and Wright’s opposition and concluded that Plaintiff had confused taxable costs

in this Court with taxable costs on appeal in the Fifth Circuit, and she failed to cite to any

authority in support of her Motion to Review; thus, the Court denied the motion.22 On

November 29, 2021, Wright filed the pending motion seeing the Court’s issuance of a

Show Cause Order requiring Plaintiff's counse! to explain why he not be held in contempt

of Court for his failure to abide by this Court’s Order for taxation of costs and the prior

$636.50 discovery sanction.*4 Wright maintains that the conduct of Plaintiff's counsel has

been an attempt to obstruct the progress of this case and needlessly increase the cost of

litigation.2°

” Rec. Doc, No. 117.

18 Rec, Doc. No. 119.

18 Rec. Doc. No. 20.

20 Rec. Doc. No. 124.

21 Rec. Doc. No, 125.

22 Rec. Doc. No. 126.

23 Rec. Doc. No. 129, p. 2.

74 Rec, Doc. No. 130, pp. 2-3.

28 Rec. Doc. No. 130-1, p. 3.

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In response, Plaintiff's counsel filed a Counter Motion citing the Federal Rules of

Appellate Procedure 39(d) in support of her position.2° Counsel asserts that, since Wright

never filed an itemized and verified bill of costs, the order taxing costs against Plaintiff is

invalid.2” Counsel further argues that the taxation of costs was untimely because the order

was issued after the closing of the case but prior to the lodging of appeal.2® Counsel fails

entirely to address the discovery sanction and generally asserts arguments that have

been repeatedly rejected by this Court. Wright submitted a Reply raising the question

whether Plaintiff's counsel should be subject to Rule 11(b) sanctions for the substance of

the Counter Motion.

This Court has already held that the discovery sanction imposed against Plaintiff's

counsel is valid as is the taxation of fees and costs related to these proceedings. The

challenges to the discovery sanction and the imposed fees and costs have been reviewed

and rejected.2° The Court will not continue to litigate these matters; Plaintiff has lost this

case, has lost her appeal, and SHALL pay the fees and costs taxed. Likewise, Plaintiffs

counsel SHALL pay discovery sanction.

The question before the Court at present is whether Plaintiff's counsel should be

held in civil contempt for failing to comply with these orders and whether Plaintiff's counsel

should be further sanctioned under Rule 11 of the Federal Rules of Civil Procedure for

continuing to file frivolous pleadings.

27 fd. at p. 2.

78 fd. at p. 4.

28 Rec, Doc, Nos. 48, 126, 129, p. 2.

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ll. LAW & ANALYSIS

“[I]t is firmly established that the power to punish for contempts is inherent in all

courts.”° In a civil contempt proceeding, the movant must establish by clear and

convincing evidence that (1) a court order was in effect, (2) the order required specified

conduct by the respondent, and (3) the respondent failed to comply with the court's

order.3' “Once the movant has shown a prima facie case, the burden falls on the violating

party to ‘show either mitigating circumstances that might cause the district court to

withhold the exercise of its contempt power, or substantial compliance with the ...

order.” If a party is found in civil contempt, a court may sanction that party “to coerce

compliance ... or to compensate ... for the ... violation.”**

When the elements of civil contempt have been met, the Court must still consider

whether civil contempt is appropriate. The Court must consider: “1) the harm from

noncompliance; (2) the probable effectiveness of the sanction; (3) the financial resources

of the contemnor and the burden the sanctions may impose; and (4) the willfulness of the

contemnor in disregarding the court's order.”*4

In Massachusetts Mutual Life ins. Co. v. Williamson,*> a case upon which Wright

relies, the District Court for the Northern District of Mississippi addressed a case wherein

a party failed to comply with a court-ordered monetary sanction. The court held that

30 Chambers v. NASCO, Inc., 501 U.S. 32, 44 (1991) (quotation marks omitted).

31 United States v. City of Jackson, Miss., 359 F.3d 727, 731 (5th Cir. 2004), citing Am. Airlines, Inc. v.

Allied Pilots Ass'n, 228 F.3d 574, 581 (5th Cir. 2000).

*2 Little Tchefuncte River Assoc. v. Artesian Util. Co., Inc., 155 F. Supp. 3d 637, 657 (E.D. La. 2015) (quoting

Whitfield v. Pennington, 832 F.2d 909, 914 (Sth Cir. 1987}).

33 In re White-Robinson, 777 F.3d 792, 795 (5th Cir. 2015) (quoting In re Terrebonne Fuel & Lube, Inc., 108

F.3d 609, 612 (5th Cir. 1997).

34 | amar Fin. Corp. v. Adams, 918 F.2d 564, 567 (5th Cir. 1990) (citing United Mine Workers, 330 U.S.

258).

35 No. 4:15-CV-166-DMB-JMV, No. 4:15-CV-184-DMB-JMV, 2019 WL 7195318 (N.D. Miss. Dec. 26, 2019).

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Williamson was properly ordered to pay a $3,000 fee award, held her in civil contempt,

and allowed Massachusetts Mutual to submit additional documentation for its losses

caused by Willlamson.*® The court explained:

In addition to the inherent power of contempt, federal courts retain the

inherent power to sanction abuse of the judicial process. Manez v.

Bridgestone Firestone N. Am. Tire, LLC, 533 F.3d 578, 591 (7th Cir. 2008)

(“{C]ourts retain inherent power to punish the full range of litigation abuses.

This power is distinct from the contempt power.”}(citation omitted). While

sanctions under this power do not require a violation of a court order (as

would a sanction based on civil contempt), they ordinarily require a specific

finding of bad faith on the part of the party to be sanctioned. in re Sealed

Appellant, 194 F.3d 666, 671 (5th Cir. 1999). However, this finding may be

inferred “[w]hen bad faith is patent from the record...” /d. Sanctions imposed

under this power should serve one of two purposes “vindicating judicial

authority without resort to the more drastic sanctions available for contempt

of court and making the [other] party whole for expenses caused by his

opponent's obstinacy.” Chambers, 501 U.S. at 46. In choosing a sanction,

a court “must employ the least possible power adequate to the end

proposed.” /n re Carroll, 850 F.3d 811, 814 (5th Cir. 2017).

When assessing fees to an opposing party, a court invoking its inherent

power to sanction bad-faith conduct “may go no further than to redress the

wronged party for losses sustained.” Goodyear Tire & Rubber Co. v.

Haeger, 137 S. Ct. 1178, 1186 (2017)(quotation marks omitted). However,

a court may levy a fine to be paid to the Clerk of Court, to address

misconduct. See Steeger v. JMS Cleaning Servs., LLC, No. 17cv8013,

2018 WL 1363497, at *2 (S.D.N.Y. Mar. 15, 2018) (Goodyear Tire did not

prevent imposition of fine under court's inherent power).??

Wright also submits that the decision in Garcia v. Metropolitan Life Insurance

Company® is applicable to the facts this case. In Garcia, the court had previously’ .

ordered the plaintiffs counsel to pay $10,936.92 in sanctions to the defendants after

“repeatedly filing meritless lawsuits.”°° When a few months passed with no payment, the

6 Id, al “4,

37 fd, at *3 (footnotes omitted).

38 No. 1:49-cv-113, 2020 WL. 6688603 (S.D. Tex. Oct. 1, 2020).

39 fd. at *1.

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defendants moved for contempt; the plaintiff's counsel moved to dismiss the origina!

sanctions order.” The court reviewed the briefs and granted the motion for contempt.‘

In this matter, the Order requiring Piaintiff's counsel to pay Wright $636.50 was

entered on August 7, 2019. The Order required this payment on or before August 21,

2019. Nearly three years later, Plaintiff's counsel has still not paid this sanction. The

Plaintiff was taxed with fees and costs related to these proceedings on September 23,

2021; Plaintiff has yet to pay these fees and costs.

Replying to Plaintiff's Counter Motion, Wright has also raised the issue of the

appropriateness of a Rule 11(b) sanction. Federal Rule of Civil Procedure 11 provides,

in pertinent part:

(b) By presenting to the court a pleading, written motion, or other paper—whether

by signing, filing, submitting, or later advocating it—an attorney or unrepresented

party certifies that to the best of the person's knowledge, information, and belief,

formed after an inquiry reasonable under the circumstances:

(2) the claims, defenses, and other legal contentions are warranted by

existing law or by a nonfrivolous argument for extending, modifying, or

reversing existing law or for establishing new law;

(3) the factual contentions have evidentiary support or, if specifically so

identified, will likely have evidentiary support after a reasonable opportunity

for further investigation or discovery; and

(c}(3) On the Court's Initiative. On its own, the court may order an attorney, law

firm, or party to show cause why conduct specifically described in the order has

not violated Rule 11(b).

In Heisler v. Kean Miller, LLP, the Eastern District of Louisiana explained:

The purpose of Rule 11 is to deter baseless filings in the district court, and

to spare innocent litigants and overburdened courts from the filing of

40 Id.

41 Id,

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frivolous lawsuits.44 The United States Fifth Circuit Court of Appeals has

interpreted Rule 11 to impose three affirmative duties, which an attorney or

litigant, by signing a pleading, written motion, or other paper, certifies he

has complied with: (1) the duty to conduct a reasonable investigation into

the facts supporting the document; (2) the duty to conduct a reasonable

inquiry into the law to ensure the document “embodies existing legal

principles or a good faith argument for extension, modification or reversal

of existing law”; and (3) the duty to certify that a document is not filed or

interposed merely for purposes of delay, harassment, or increasing litigation

costs.*5 Courts judge compliance with Rule 11’s standards under an

objective reasonableness standard, evaluating the circumstances as they

existed at the time the challenged filing was signed by the lawyer or

litigant.44

In light of the objective standard of reasonableness applied under Rule 11,

an attorney's subjective good faith is not enough to immunize him from

sanctions based on a Rule 171 violation. In deciding a motion under Rule

11, courts within the Fifth Circuit are required to determine whether the

signatory has complied with the affirmative duties imposed under the rule.*®

District courts have wide latitude to impose sanctions under Rule 11 as

district court rulings under Rule 11 are reviewed for abuse of discretion.*’

District courts possess discretion in determining the nature of the

appropriate sanction.*§

Rule 11 sanction decisions must comport with due process requirements.*9

Further, courts must ensure that notice and an opportunity to be heard have been given

before Rule 11 sanctions may be imposed.®° This requirement is generally satisfied by

‘[s]imply giving the individua! accused of a Rule 11 violation a chance to respond through

42 No, 21-724, 2021 WL 5919507, *3 (E.D. La. Dec. 15, 2021)(citing Cotfer & Gell v. Hartmarx Corp., 496

U.S. 384, 393 (1990})).

43 id, (quoting Childs v. State Farm Mut. Auto. Ins. Co,, 29 F.3d 1019, 1023-24 (5th Cir. 1994)).

44 tel. (citing Childs, 29 F.3d at 1024).

45 Id. (citing Thomas v. Cap. Sec, Servs., Inc, 836 F.2d 866, 873 (5th Cir. 1988)),

46 fd. (citing Thomas, 836 F.2d at 875).

47 Id. (citing Whitehead v. Food Max of Miss., inc., 332 F.3d 796, 802 (5th Cir. 2003)).

48 Jd. (citing Thomas, 836 F.2d at 876-877).

49 fd. at *7 (citing Childs, 29 F.3d at 1027. Spiller v. Ella Smithers Geriatric Ctr., 919 F.2d 399, 349 (5th Cir.

1990)).

50 Ming Childs, 29 F. 3d at 1027 (citing Bodie v. Connecticut, 401 U.S. 371, 379 (19713, and Veillon v.

Exploration Services, Inc., 876 F.2d 1197 (5th Cir. 1989))).

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the submission of a brief.”°"

As to the appropriateness of the sanction, the He/s/er court stated:

Once a violation of Rule 11 has been found, the district court is vested with

considerable discretion in tailoring an appropriate sanction to further the

purposes of Rule 11—namely, punishment, deterrence, and

compensation.*? Rule 11’s primary purpose is deterrence. The Fifth Circuit

has instructed district courts to impose the least severe sanction in pursuit

of the purposes of Rule 11.54 Rule 11(c)(4) “expressly allows a district court

to impose monetary sanctions payable to the court."°5 The Advisory

Committee Notes to the 1993 amendments to Rule 11 provide that “[s]ince

the purpose of Rule 11 sanctions is to deter rather than to compensate, the

rule provides that, if a monetary penalty is imposed, it should ordinarily be

paid into court as a penalty.”5°

Based on the foregoing, there is ample support for Wright’s Motion. The Court will

allow Plaintiff and her counsel to respond before the Court makes further findings.

IIE. CONCLUSION

Applying the applicable law to the facts of this case, the Court GRANTS Wright's

Motion to Issue Order to Show Cause.*’ Plaintiff's Counter Motion®® is DENIED.

51 Id, (quoting Childs, 29 F.3d at 1027 (citing Spiller, 919 F.2d at 347)).

82 Id, (citing Am. Airlines, Inc. v. Allied Pilots Assoc,, 968 F.2d 523, 533 (5th Cir. 1992)).

53 fd. (citing Cooter & Gell v. Hartmarx Corp., 496 U.S. 384 (1990); see also Bus. Guides, Inc. v. Chromatic

Comme'ns Enterprises, inc., 498 U.S. 533 (1991); Thomas v. Cap. Sec. Servs., inc., 836 F.2d 866, 881

(5th Cir. 1988); Rayion LLC v. Compius Data Innovations, Co., No. 6:09-CV-355, 2015 WL 11121530, at

*4 (E.D. Tex. May 4, 2015)}.

54 fd. (citing Thomas v. Cap. Sec. Servs., Inc., 836 F.2d at 878).

5§ fd. (quoting Carr v. Cap. One, N.A., 460 F. App'x 461, 468 (5th Cir. 2012)).

58 fd. (quoting Rule 11 Advisory Committee Notes, 1993 Amendments).

57 Rec. Doc. No. 130.

58 Rec. Dac. No. 137.

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IT IS HEREBY ORDERED that Jesse Clarence Brown, counsel for Plaintiff herein,

show cause in writing, on or before August 1, 2022, why he should not be held in civil

contempt of this Court and why he should not be further sanctioned under Rule 11(b) of

the Federal Rules of Civil Procedure for the reasons set forth above. The Court shall not

extend this deadline absent extraordinary circumstances.

Signed in Baton Rouge, Louisiana this 5 day ot Lega 2022.

CHIEF snap D. DICK

UNITED STATES DISTRICT COURT

MIDDLE DISTRICT OF LOUISIANA

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