concluding that in addition to the fact that neither the 2 plain language of Fed. R. Civ. P. 11 nor the committee note mandated additional due 3 process protections when imposing a punitive monetary fine under Fed. R. Civ. P. 4 11, the fear of spawning “satellite litigation” by requiring a second trial whenever 5 punitive monetary fines may be imposed was enough to cause the vitality of Fed. R. 6 Civ. P. 11 to be “drained away”
How later courts described this case
- concluding that in addition to the fact that neither the 2 plain language of Fed. R. Civ. P. 11 nor the committee note mandated additional due 3 process protections when imposing a punitive monetary fine under Fed. R. Civ. P. 4 11, the fear of spawning “satellite litigation” by requiring a second trial whenever 5 punitive monetary fines may be imposed was enough to cause the vitality of Fed. R. 6 Civ. P. 11 to be “drained away”
- finding that due process requires notice and an opportunity to respond prior to imposition of Rule 11 sanctions but that a hearing is not necessary and may be a “waste of judicial resources” where the attorney fails to present support for her claims despite opportunities to do so
- explaining that it is advisable to avoid a sanction that penalizes the parties for the offenses of their counsel
- finding Rule 11 sanctions based on the factual adequacy of a complaint are best considered after the parties have moved for summary judgment and have been given notice and opportunity to identify any genuine issues of material fact
Written by the judges who cited it.
The opinion
JOHNSON, Circuit Judge,
specially concurring, in which TJOFLAT, KRAVITCH, and HATCHETT, Circuit Judges, join:
Although I agree in the main with the majority’s opinion, I write separately to highlight a couple of my concerns. First, I wish to emphasize that, under certain circumstances, courts may have to follow the procedures set forth in Fed.R.Crim.P. 42(b) when imposing sanctions under Rule 11. As the majority indicates, monetary sanctions imposed for an attorney’s failure to carry out his responsibilities as an officer of the court generally have been viewed as differing “from the more severe infractions of criminal contempt.” Miranda v. Southern Pacific Transportation Co., 710 F.2d 516, 521 (9th Cir.1983). Thus, courts often can impose those sanctions without the full panoply of procedural rights called for in *1563 Rule 42(b). Nonetheless, such sanctions can assume the criminal character of a fine as, for instance, when their amount is grossly disproportionate to the attorney’s misconduct. Matter of Yagman, 796 F.2d 1165, 1180-81 (9th Cir.1986). Additional due process safeguards are necessary under those circumstances. Those additional safeguards should parallel the procedures provided for in Rule 42(b).
Admittedly in Kleiner v. First National Bank of Atlanta, 751 F.2d 1193, 1209-10 (11th Cir.1985), we held that a monetary sanction imposed on an attorney in a judicial disciplinary hearing was not a penalty for criminal contempt even though it bore all the indicia of being so. However, that decision did not foreclose the possibility that under certain circumstances the imposition of such a sanction might need to comport with the procedures set forth in Rule 42(b). In affirming the sanction, the court determined that the size of the fine was commensurate with the attorney’s misconduct. Id. at 1210 . Thus Kliener does not speak directly to situations where, as discussed in Yagman, such sanctions parallel a penalty for criminal contempt.
I do not read the majority’s opinion as excluding the possibility that in those circumstances a court may have to follow the procedures set forth in Rule 42(b). Nonetheless, I believe that this point bears special emphasis lest the specter of satellite litigation trample the due process rights that the targets of judicial sanctions undeniably possess.
Second, I wish to emphasize that the district court’s summary method of sanctioning plaintiff’s counsel violated due process. The majority correctly points out that due process requires that an attorney must have fair notice of the possible imposition of Rule 11 sanctions and an opportunity to respond to the invocation of Rule 11. The majority also points out that, in ruling on a Rule 56 motion for summary judgment, a court may be able to decide without further proceedings whether to impose Rule 11 sanctions as long as the attorney had notice that sanctions are contemplated and had a reasonable opportunity to “contest and explain.” That opportunity to contest and explain, however, must be more than the opportunity to submit material in support of or in opposition to a motion for summary judgment, for a court cannot sanction an attorney under Rule 11 simply because his client failed to prevail on a motion for summary judgment. Instead, the court must determine whether, at the time the complaint or motion was filed, the attorney believed after objectively reasonable inquiry that the complaint or motion was well grounded in fact. See, e.g., Hashemi v. Campaigner Publications, Inc., 784 F.2d 1581, 1583 (11th Cir.1986). A court cannot reliably make that determination simply on the basis of the material submitted in connection with a motion for summary judgment. Therefore, before a court imposes Rule 11 sanctions on an attorney, that attorney must be allowed to explain why he reasonably believed that the complaint or motion was well grounded in fact.
As the majority’s recitation of the facts indicates, the district court here denied plaintiff’s counsel an adequate opportunity to contest, either orally or in writing, the imposition of Rule 11 sanctions and to explain his actions. The court sanctioned plaintiffs counsel ostensibly because the complaint was not well grounded in fact. However, the only hearing the court conducted was commenced to discuss the defendants’ motions to dismiss the complaint for failure to state a claim. During that hearing the court’s focus did shift to the question of whether there was any factual basis for the complaint. Nonetheless, plaintiff’s counsel had no notice that that question would be discussed and thus had no opportunity to prepare his position. Near the close of the hearing, the court instructed plaintiff’s counsel to submit personal financial statements for use in the event the court decided to impose sanctions under Rule 11. Although that instruction notified plaintiff’s counsel that the court was considering imposing sanctions, the court did not request plaintiff’s counsel to make any submission opposing the imposition of sanctions. Nor did the court indicate that it would entertain any such sub *1564 missions. Furthermore, between the hearing and the entry of its order imposing sanctions approximately one month later, the court did not comment on the matter of sanctions. Finally, after entering that order, the court did not allow plaintiffs counsel any opportunity to respond. Such summary procedures contravene the principles of due process the majority espouses.
That Rule 11 does not require a separate evidentiary hearing in every case before sanctions can be imposed does not alter my assessment of the district court’s actions. In all of the cases the majority cites for the proposition that a separate evidentiary hearing is unnecessary, the sanctioned party had an opportunity to contest and explain his actions. In fact in Oliveri v. Thompson, 803 F.2d 1265, 1280 (2d Cir.1986), ce rt. denied sub nom. County of Suffolk v. Graseck, — U.S. —, 107 S.Ct. 1373 , 94 L.Ed.2d 689 (1987), the court stated that, although Rule 11 does not mandate a separate evidentiary hearing, “notice and an opportunity to be heard is required.” Thus, although an effective opportunity to contest and explain does not always necessitate a separate, full-blown evidentiary hearing, there must be some reasonable opportunity to challenge the imposition of Rule 11 sanctions.
With these clarifying comments, I concur in the opinion of the court.