Hollister v. Soetoro

UNITED STATES DISTRICT COURT

FOR THE DISTRICT OF COLUMBIA

GREGORY S. HOLLISTER, :

:

Plaintiff, :

:

v. : Civil Action No. 08-2254 (JR)

:

BARRY SOETORO, et al., :

:

Defendants. :

MEMORANDUM ORDER

We live in a free country. Our liberties are manifold

and are the envy of the world. In the very top tier of those

liberties, enshrined in the First Amendment, is “the right of the

people . . . to petition the Government for a redress of

grievances.” Many of those petitions are presented to judges.

Every judge knows that a disturbingly high percentage of them

involve petty slights, or imagined injuries, or matters that lie

well beyond the reach of the judicial writ, but most judges will

agree that it is important at least to listen to them --

especially to the grievances of poor petitioners, or

disadvantaged petitioners, or petitioners who do not have

lawyers -- even if the courts are powerless to grant relief.

Lawyers who come to court to present grievances,

however, are held to a higher standard than disadvantaged or

unrepresented persons. For lawyers, there are rules. A lawyer

knows that no judge has any business addressing or ruling upon a

dispute, no matter how fervently he or his clients may feel about

it, unless the judge has both personal and subject matter

jurisdiction, unless the client has standing to be heard, unless

the cause is ripe and justiciable, and unless the complaint

states a claim upon which relief can be granted. A lawyer who

comes to federal court also knows, because the Federal Rules of

Civil Procedure plainly say so, that his signature on a complaint

“certifies that to the best of the person’s knowledge and belief,

formed after an inquiry reasonable under the circumstances,” the

complaint “is not being presented for any improper purpose,” Rule

11(b)(1), and that “the claims . . . 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,” Rule 11(b)(2).

John D. Hemenway is a lawyer and a member of the bar of

this court. The dispute that he attempted to litigate here was

about whether or not Barack Obama is a “natural born Citizen,”

and thereby qualified under Article II, section 1 of the

Constitution to be President. Many people, perhaps as many as a

couple of dozen, feel deeply about this issue. Attempts have

been made to tee the question up for judicial resolution in a

number of courts across the country. See, defendant’s motion to

dismiss [Dkt. #9-1 p. 3, n.1]. Mr. Hemenway’s associate,

Philip J. Berg, made at least one such attempt, suing in a

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federal court in Pennsylvania, naming himself as plaintiff.

After that suit was dismissed (for lack of standing), and after

the Supreme Court declined to hear him, Mr. Berg (apparently)

found another plaintiff, a man who retired from the Air Force as

a colonel more than ten years ago and now claims to be uncertain

about whether -– if he were recalled to active duty -– he would

have to obey commands that come from President Obama as

commander-in-chief. Mr. Berg (presumably) enlisted Mr. Hemenway

in this cause. Mr. Hemenway, Mr. Berg, and Lawrence J. Joyce

then filed this lawsuit.1 Mr. Hemenway signed the complaint,

certifying his compliance with Rule 11(b).

The complaint asserts a single cause of action,

invoking the interpleader statute, 28 U.S.C. § 2235. That

statute provides:

(a) The district courts shall have original

jurisdiction of any civil action of interpleader or in

the nature of interpleader filed by any person, firm,

or corporation, association, or society having in his

or its custody or possession money or property of the

value of $500 or more, or having issued a note, bond,

certificate, policy of insurance, or other instrument

of value or amount of $500 or more, or providing for

the delivery or payment or the loan of money or

property of such amount or value, or being under any

obligation written or unwritten to the amount of $500

or more, if

(1) Two or more adverse claimants, of diverse

citizenship as defined in subsection (a) or (d) of

section 1332 of this title, are claiming or may claim

1

Messrs. Berg and Joyce are not members of the bar of this court and

were not granted leave to appear pro hac vice. See [#10].

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to be entitled to such money or property, or to any one

or more of the benefits arising by virtue of any note,

bond, certificate, policy or other instrument, or

arising by virtue of any such obligation; and if

(2) the plaintiff has deposited such money or property

or has paid the amount of or the loan or other value of

such instrument or the amount due under such obligation

into the registry of the court, there to abide the

judgment of the court, or has given bond payable to the

clerk of the court in such amount and with such surety

as the court or judge may deem proper, conditioned upon

the compliance by the plaintiff with the future order

or judgment of the court with respect to the subject

matter of the controversy.

(b) Such an action may be entertained although the

titles or claims of the conflicting claimants do not

have a common origin, or are not identical, but are

adverse to and independent of one another.

I have said nothing, and have nothing to say, about the

merits of the “natural born Citizen” question that Messrs.

Hemenway, Berg, et al., have sought to present here. I have no

business addressing the merits, because, having found that

Mr. Hemenway’s interpleader suit failed to state a claim upon

which relief can be granted, I have dismissed it. The only

question that remains before me is whether Mr. Hemenway, when he

signed the complaint, violated Rule 11(b). It seemed to me when

I dismissed the complaint, on March 5, 2009, that Mr. Hemenway’s

invocation of the interpleader statute as the vehicle for his

complaint was completely frivolous. For that reason, and in

compliance with Rule 11(c)(3), I ordered Mr. Hemenway to show

cause why I should not find him in violation of Rule 11(b),

either because he presented the suit for an improper purpose,

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Rule 11(b)(1), or because his claims and other legal contentions

were not “warranted by existing law or by a nonfrivolous argument

for extending, modifying, or reversing existing law or for

establishing new law,” Rule 11(b)(2), or both. Mr. Hemenway,

responding to that order, has filed about 35 pages of argument

and self-justification. Most of his submission deals with the

merits of his claim, which, again, are not the subject of the

present memorandum.

In so far as Mr. Hemenway’s submission addresses the

legal sufficiency of his interpleader claim, his argument may be

summarized as follows:

(I.) The word “property” in the interpleader statute,

28 U.S.C. § 1335, must be construed broadly. For this

proposition, Mr. Hemenway cites no authority construing the word

“property” as it appears in the interpleader statute; he cites

only cases decided in the context of other statutes: Carpenter v.

U.S., 484 U.S. 19 (1987) (confidential information is “property”

within the meaning of the mail and wire fraud statute); First

Victoria Nat. Bank v. U.S., 620 F.2d 1096 (5th Cir. 1980) “rice

history acreage” is “property” for estate tax purposes); Matter

of Nichols, 4 B.R. 711 (E.D. Mich 1980) (in bankruptcy law,

“property” refers to “one, or some, of whatever kind of those

items which are subject to ownership, whether it is tangible or

intangible, visible or invisible, corporeal or incorporeal, real

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or personal”); and Glosband v. Watts Detective Agency, Inc., 21

B.R. 963, 971-72 (D.Mass. 1981) (in bankruptcy law, “property”

interpreted “most generously” to incorporate “anything of value

which but for the transfer might have been preserved for the

trustee to the ultimate benefit of the bankrupt's creditors”).

(ii.) Mr. Hollister’s “duty” can be the subject of an

interpleader action. Here, Mr. Hemenway cites Bank of Neosho v.

Colcord,, 8 F.R.D. 621 (W.D.Mo. 1949), for the proposition that

“a duty with respect to a sum of money has . . . been found to be

a proper matter for interpleader.” [Dkt. #23, p. 10.] That is a

significant distortion of the decision. Colcord (even if it were

controlling law, which it is not) does not support Mr. Hemenway’s

point. Colcord was a traditional interpleader case that involved

a contract for the sale of a ranch. The sale “failed,” whereupon

the disinterested stakeholder, uncertain whether to disburse the

$5,000 earnest money to the contract seller or the contract

buyer, deposited the funds in the registry of the court and sued

for interpleader. The contract buyer then cross-claimed against

the contract seller for specific; the contract seller moved to

dismiss because the cross-claim was not for interpleader; and the

court denied the motion, deciding nothing more than that a cross-

claim for the “duty” of specific performance would lie in the

same case because it involved the same subject matter as the

underlying interpleader action.

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(iii.) An interpleader case does not require a formal

demand on the plaintiff or even a deposit with the court. Here

Mr. Hemenway cites Dunbar v. United States, 502 F.2d 506, 511

(5th Cir. 1974). Worse than distorting the holding of that case,

he completely misstates it. In Dunbar, the post office refused

to deliver a suspicious package of money, and the United States

filed an interpleader action to see who might claim it. The

court was harshly critical of the government’s resort to “cosmic

interpleader,” id. at 512, and refused to allow the government to

use the suit as a vehicle for the conduct of broad discovery.

What Mr. Hemenway should have gleaned from the case was the

court’s finding that “a prerequisite for [interpleader] is that

the party requesting interpleader demonstrate that he has been or

may be subjected to adverse claims.” American Fidelity Fire Ins.

Co. v. Construcciones Werl, Inc., 407 F. Supp 164, 173 (D.V.I.

1975), which Mr. Hemenway cites with Dunbar, is to the same

effect. Underwriters at Lloyd’s v. Nichols, 363 F.2d 357 (8th

Cir. 1966), an exhaustive and scholarly opinion, comes to the

same conclusion, concluding that interpleader requires real

claims, or at least the threat of real claims -- not theoretical,

polemical, speculative, or I’m-afraid-it-might-happen-someday

claims.

(iv.) No court has held “that [an] intangible res

cannot be the subject of Interpleader.” [Dkt. #23, p. 11]. This

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proposition is remarkable only for the authorities Mr. Hemenway

cites to support it: Martin v. Wilks, 490 U.S. 755 (1989) (a

decision that has nothing to do with any issue in this case, as

nearly as I can tell); and N.O.W. v. Scheidler, 510 U.S. 249

(1994) (statutory construction: motivation of economic purpose

will not be read into RICO statute). Moreover, one might add, no

court has held that a claim made for the first time cannot on

that account be found frivolous, or that “creativity” confers

immunity from Rule 11 sanctions.

Perhaps the most interesting case that Mr. Hemenway

cites -– interesting because, more than any of the others in his

submission, it demonstrates just what is wrong with his

interpleader claim -- is Xerox Corp. v. Nashua Corp., 314 F. Supp

1187 (S.D.N.Y. 1970). Xerox sued Nashua for infringing its

patent on copy paper. Nashua counterclaimed to interplead RCA,

asserting that, if it was infringing Xerox’s patent, it was also

infringing a patent owned by RCA, and that it did not know to

which party it should pay royalties. Judge Weinfeld observed,

id. at 1189:

Although Nashua's invocation of interpleader in this

case is novel, its assertion that if the two patents

interfere, interpleader should lie because of the risk

of multiple liability is not without appeal. Rule

22(1) of the Federal Rules of Civil Procedure

authorizes an interpleader action where (1) two or more

persons have claims against the interpleading party,

and (2) as a result, the interpleading party is or may

be exposed to multiple liability. It is no longer

required that the claims be of common origin or that

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the interpleading party be a wholly neutral

stakeholder. The rule does not even require a ‘stake’

or ‘fund’ as such. The action will lie where all that

is involved is the threat of multiple liability on what

is in fact but a single claim or obligation. While the

patent situation is more complex than the normal

interpleader situation, its complexity alone does not

foreclose interpleader.

Judge Weinfeld dismissed the interpleader claim, however, finding

that “the postulated situation envisaged by Nashua remains no

more than a conjectural view of possible conflicting holdings,”

id. at 1190 (emphasis added). Judge Weinfeld went on to state,

id.:

The court is not prepared to cast Xerox and RCA in the

role of unwilling litigants where, upon substantial

grounds, they challenge the validity of the basis upon

which Nashua seeks to force them into adversary

positions, while Nashua presents only its bare

conclusions in support of its position. Although

parties should be protected against multiple and

conflicting liability . . . unjustified interpleader

proceedings in a case such as this have substantial

disadvantages.

“The case offered no hope whatsoever of success, and

plaintiffs’ attorneys surely knew it.” That was the finding of

Judge Jackson in Saltany v. Reagan, 702 F. Supp. 319, 322 (D.D.C.

1988), a case in which, as in this one, the plaintiffs had an axe

to grind -– a case, like this one, that “[t]he Court surmise[d]

was brought as a public statement of protest of Presidential

action with which counsel (and, to be sure, their clients) were

in profound disagreement.” Finding that the plaintiffs’

injuries were not insubstantial (plaintiffs were suing for

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injuries, deaths, and losses suffered in the 1986 American

airstrikes against Libya), Judge Jackson concluded that the suit

was not “frivolous so much as it is audacious,” and he declined

to find a Rule 11 violation or to impose sanctions on counsel.

Saltany, 702 F. Supp. at 322. The Court of Appeals reversed, 886

F.2d 438 (D.C. Cir. 1989). The trial court’s finding that “[t]he

case offered no hope whatsoever of success, and plaintiffs'

attorneys surely knew it” was, the Court of Appeals held, a

finding “in substance if not in terms, that plaintiffs' counsel

had violated Rule 11.” Id. at 440.2 Judge Jackson had been

inclined to cut counsel a break, because their suit was brought

as a “public statement of protest.” The Court of Appeals was not

so inclined: “We do not conceive it a proper function of a

federal court to serve as a forum for ‘protests,’ to the

detriment of parties with serious disputes waiting to be heard.”

Ibid.

This case, like Saltany, offered no hope whatsoever of

success, and Mr. Hemenway surely knew it. Mr. Hemenway had no

colorable authority for the proposition that Mr. Hollister’s

contingent claim of “duty” could be the res in an interpleader

suit, or, given the speculative and contingent nature of such a

2

That holding was reaffirmed, on a second appeal, by the law of the

case doctrine, see Saltany v. Bush, 960 F.2d 1060 (D.C. Cir. 1992), over the

dissent of Judge Wald that “no hope whatsoever of success” was “not an

appropriate substitute for the findings required by Rule 11,” id. at 1061.

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“duty,” that his claim had any particular dollar value.

Mr. Hemenway’s complaint did not even allege the sine qua non of

an interpleader suit -– that “[t]wo or more adverse

claimants . . . are claiming or may claim to be entitled to such

money or property, or to any one or more of the benefits . . .

arising by virtue of any such obligation. . . .” 28 U.S.C.

§ 1335(a)(1). Mr. Hemenway’s suit was not a suit in interpleader

or in the nature of interpleader. It was legally frivolous.

By signing and filing a legally frivolous complaint, Mr. Hemenway

violated at least Rule 11(b)(2).

The Court of Appeals remanded Santany to Judge Jackson

with instructions to impose a sanction, since, when that case was

decided in 1989, a sanction was mandatory upon a finding of a

Rule 11 violation. The 1993 amendments to Rule 11 made the

imposition of sanctions discretionary with the trial court.

Extensive Advisory Committee Notes explained that “the purpose of

Rule 11 sanctions is to deter rather than compensate.” Rule

11(c)(4) thus contemplates and permits a monetary sanction in the

form of a penalty, but such a sanction is now limited to “what

suffices to deter repetition of the conduct or comparable conduct

by others similarly situated.”3

3

My order to show cause in this case [Dkt. #22] suggested, as one

appropriate sanction, that Mr. Hemenway be ordered to pay the attorneys’ fees

and expenses that his improper filing made necessary. Mr. Hemenway correctly

observes, however, that Rule 11(c) no longer permits an order for the payment

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Mr. Hemenway is 82 years old and takes considerable and

justified pride in his patriotic public service and his status as

a Rhodes Scholar. He is unlikely to repeat the conduct that gave

rise to this proceeding, and in his case the permissible

alternative sanction of a reprimand will be sufficient. “Others

similarly situated” -– the people who put Mr. Hemenway up to

filing this foolish suit – are unlikely to be deterred, except by

a penalty that would be unreasonable to impose on Mr. Hemenway

alone.4

John D. Hemenway is hereby reprimanded for his part in

the preparation, filing, and prosecution of a legally frivolous

suit in this court. The order to show cause [Dkt. #22] is

discharged. It is SO ORDERED.

JAMES ROBERTSON

United States District Judge

of attorney's fees and expenses except upon motion -– and no such motion has

been filed.

4

See http://www.obamacrimes.info/ (last visited 3/24/09) “02/13/09:

PRESS RELEASE - Berg Fighting On. 3 Pending Lawsuits to Expose Obama for ‘not’

being Constitutionally ‘qualified/eligible’ to be President and Berg requests

help to spread the word as the major media refuses . . . Request - Everyone

who can - Please raise, by asking four [4] friends @ $15.00 each, or

contribute $60.00 to us now. You can use PayPal or credit card on our website

or mail a check. ”

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