Opposition Brief — Garratt v. INVST Financial Group, Inc.

saz. Gupreme Court, U.S,

f~* BIEL ED

No. 87-423 {| QCT 10 4987

POSER SFANIOL, UR,

CLERK

In The

Supreme Court of the United States

October Term, 1987

O

C. WILLIAM GARRATT and

GARRATT & MORRIS, P.C.,

Petitioners,

INVST FINANCIAL GROUP, INC.,,

Respondent.

oO

ON WRIT OF CERTIORARI TO THE

UNITED STATES COURT OF APPEALS FOR

THE SIXTH CIRCUIT

O

BRIEF IN OPPOSITION TO

PETITION FOR WRIT OF CERTIORARI

0

Mark E. Reizenx, Esquire

Joun K. Parker, Esquire

BusHNeELL, Gace, Re1zeENn

& Parron

3000 Tewn Center, Suite 1500

Southfield, Michigan 48075

(313) 444-4848

Attorneys for Resrondent

October &, 1987

COCKLE LAW BRIEF PRINTING CO., (800) 225-6964

or call collect (462) 342-2831

QUESTION PRESENTED

I

DID THE COURT OF APPEALS ERR IN AFFIRM-

ING THE DISTRICT COURT’S IMPOSITION OF

SANCTIONS UPON PETITIONER UNDER FED.R.

CIV.P. 11 FOR FILING AN UNTIMELY AND LEGAL-

LY INSUFFICIENT MOTION TO RECUSE THE PRE-

SIDING DISTRICT COURT JUDGE FOR ALLEGED

BIAS OR PREJUDICE DIRECTED AT PETITIONER

AS COUNSEL FOR A PARTY DURING THE COURSE

OF JUDICIAL PROCEEDINGS?

TABLE OF CONTENTS

Page

URS EN PRI ee cieherlenetee eae 1

TADS: OF CONTE Be oe il

INDRA OF AU TRUS IRS e526 a lll

STATUTORY PROVISIONS AND COURT RULES

BET PRA cect ee idocigasablaincnteiean Dae se,

SLATE MEIN. OR THE: CARB onesie 2

Proceedings In The Distriet Court 2000000... 3

Proceedings In The Court Of Appeals 0000... 10

The Chem-Nuclear Appeal 2.00.00... 10

The Matter Of Sanctions «0. 14

REASONS WHY THE WRIT SHOULD BE

i AC | + | ne eenene Meee imcemer ane Msc. bs 1 Bet. 17

RIPORMCUION | once 17

I THE QUESTIONS PRESENTED DO NOT

WARRANT REVIEW IN THIS COURT AND,

MOREOVER, ARE FRIVOLOUS 17

Il. THE COURT OF APPEALS WAS FULLY

JUSTIFIED IN AFFIRMING THE IMPOSI-

TION OF SANCTIONS AGAINST Tiiki PETI-

TIONER UNDER UNIVERSALLY RECOG-

NIZED PRINCIPLES OF LAW AND THERE-

FORE REVIEW IN THIS COURT IS NOT

WeRIRIRIE RTE ccrcsichciesntimaeon ne eee 2]

Ill. OTHER FACTORS, NOT EXPRESSLY RE-

LIED UPON BY THE SIXTH CIRCUIT, ES-

TABLISH THAT GARRATT’S MOTION TO

DISQUALIFY JUDGE GILMORE WAS SANC-

TIONABLE UNDER BULLE 1) L... 6B

CONCLUSION AND PRAYER FOR RELIEF ....... at ae

APPENDICES ............. teense ena haba Ae a-1

lil

INDEX OF AUTHORITIES

A. CasgEs

Aetna Life Ins. Co. v. Lavoie, 106 S.Ct. 1580 (1986) _.21, 22

Albright v. Upjohn Co., 788 F.2d 1217 (6th Cir. 1986) . 14

Anderson v. City of Bessemer Citu, N.C... 105 S.Ct.

spe wer ll at aA CL Se Te 13

Barnes v. United States, 241 F.2d 252 (9th Cir.

a TE nt DEER Ov ew Lae

Benny v. Pipes, 799 F.2d 489 (9th Cir. 1986),

amended, 807 F.2d 1514 (9th Cir. 1987) re

Berger v. United States, 255 U.S. 22 (1921) .................23, 24

Breuer Electric Mfg. Co. v. Toronado Systems of

America, Inc., 687 F.2d 182 (7th Cir. 1982) . te an

Brown v. Wesley's Quaker Maid, Inc., 771 F.2d

952 (6th Cir. 1985), cert. denied, 107 S.Ct. 116

Ue cele 13

CO.KWS. Engineers, Inc. v. White Mountain Gypsum

Ce, tae Puce tac (7th Cir. 1984) 2D

California Bankers Ass’n v. Schultz, 416 U.S. 21

(1974) ee ack calnarer coca penesbs sianstniessk Sook 25

Crowder v, Conlan, 740 F.2d 447 (6th Cir. 1984) —.. 25

Davis v. Board of Sc’ 40l Commissioners, 517 F.2d

1044 (Sth Cir. 1974), cert. denied, 425 U.S. 944

| es, Un EN te Ait Sapa socsseccseceity OMe

Davis v. Veslan Enterprises, 765 F.2d 494 (Sth Cir.

eo Ia ee Fas ae eS "|

Dimmitt & Owens Finc., Inc. v. United States, T87

F.2d 1186 (7th Cir. 1986) . ae

Giebe v. Pence, 431 F.2d 942 (9th Cir. 1970) . -—

Gilbert v. City of Little Rock, Ark., 722 F.2d 1390

(Sth Cir. 1983), cert. denied, 466 U.S. 972 (1984) —.. 23

ES ee

INDEX OF AUTHORITIES—Continued

Page

In Re: IBM Corp., 618 F.2d 923 (2d Cir. 1980) ................. 23

In Re: Sonoma V, 703 F.2d 429 (9th Cir. 1985) ........... i, ae

In Re: United Shoe Machinery Corp., 276 F.2d 77

CE AS ARTE RE rca een ete RW dnr ae SaRe NOE 25

Insurance Corp. of Ireland Ltd. v. Compagnie des

Baumites de Guinee, 456 U.S. 694 (1982) 0... er 13

Knoll v. Socony Mobile Oil Co., 369 F.2d 425 (10th

Cir. 1966), cert. dented, 386 U.S. 977 (1967) 21

Link v. Wabash RR., 370 U.S. 626 (1962) Bs)

Moore v. McGraw Edison, 804 F.2d 1026 (8th Cir.

5} RR RNRNEID et dea aT RP OE Re nee ae NCE 23, 24

National Hockey Leaaue v. Metropolitan Hockey

(tub, Tac, 427 US. Goo (3916) 13, 20

Nicodemus v. Chrysler Corp., 596 F.2d 152 (6th

4) a) a ee ea em. SOC UO RE. ON =f NP NE 24

Orange Theatre Corp. v. Rayherstz Amusement

Corp., 130 F.2d 185 (3d Cir. 1942) (en bane) ..W.. 11

Ricci v. Key Bancshares of Maine, Inc., 111 F.R.D.

gee tte. 19) colon on 18, 26

Roadway Exp., Inc. v. Piner. 447 U.S. 752 (1980) ......... 13

Sexton v. Kennedy, 519 F.2d 797 (6th Cir. 1975) ........... —

Shephard Claims Services, Inc, v. William Darrah

é: Assoc., 796 F.2d 190 (6th Cir. 1986) WW... 11

Sony Corp. v. Elm State Electronics, Inc., 800 F.2d

Bhd CC, SI oes ee ees ee Tee

Southerland v. Irons, 628 F.2d 978 (6th Cir. 1980) ........ 9, 16,

21, 24

The William Bagaley, 72 U.S. (5 Wall.) 377 (1866) .... 29

Thomson v. Wooster, 114 U.S. 104 (1889) . 7,15

V

INDEX OF AUTHORITIES—Continued

Pave

Tolliver v. Northrop Corp., 786 F.2d 316 (7th Cir.

FOOT scinhcieenceineanduiccnnhaceanaouraneh aaah aac acres 12, 13

Traguth v. Zuck, 710 F.2d 90 (2d Cir. 1983) 11

United Coin Meter Co. v. Seaboard Coastline RR.,

706 ¥.2a Se (6th Cir. - 963) 2 ee 1]

United States v. American Ry. Express Co., 265

Rie ee CE Secale Canta aenteet aucun en areas 25

United States v. Def rantz, 708 F.2d 310 (7th Cir.

1983) 12

United States v. IBM Corp., 475 F.Supp. 1872

(FED. INE. BOOP cee SRR IM Ns ei tlt a Oo 23

United States ex rel. Wilson v. Coughlin, 472 F.2d

ee Cee es SE acetates z

United States v. Grinnell Corp., 384 U.S. 563 (1966) _.23, 24

United States v. Pugliese, 805 F.2d 1117 (2d Cir.

1986) Sor en ase Acct Boe hu 23

United States v. Ritter, 540 F.2d 459 (10th Cir.),

cert. demed, 429 US. 91 (1916) 24

Westmoreland v. CBS, Inc., 770 F.2d 1168 (D.C.

Cir. 1985) ........ Pee 0 racic WARE STE Seo) pele e Ae 14

B. ConstirutrionaL PROVISIONS, STATUTES AND

Court RuLEs

Cie: eee an 8 ee ere 17, 19, 20

7 oo. Come, Bees, Fn eee 17

SE OS Ae en een eer ae 6, 8, 17, 22, 25

Bist. 4. ee 17, 22

Pee Ce a ee 4,11

jg 8 SS ite © MRP erent munteanneenemronmnetonnrt at Haru nee PPTs. passim

Fed.R.Civ.P. 12(b)(5) ec renee 6, 14

vi

INDEX OF AUTHORITIES—Continued

Fed.R.Civ.P. 12(h)(1) 6,7

Ked.R.Civ.P. 37 sect 13, 20

Fed.R.Civ.P. 53 9

No. 87-423

ray ————

Vv

In The

Supreme Court of the United States

October Term, 1987

ty) —-

Vv

C. WILLIAM GARRATT and

GARRATT & MORRIS, P.C.,

Petitioners,

INVST FINANCIAL GROUP, INC.,

Respondent!

)

ON WRIT OF CERTIORARI TO THE

UNITED STATES COURT OF APPEALS FOR

THE SIXTH CIRCUIT

ray

Vv

BRIEF IN OPPOSITION TO

PETITION FOR WRIT OF CERTIORARI

ee O-—

The underlying action out of which this Petition grew was

fiied by Respondent as Plaintiff in the United States District

Court for the Eastern District of Michigan. INVST FINANCIAI

GROUP, INC., a Michigan Corporation, Plaintiff vy CHEM-NU-

CLEAR SYSTEMS, INC., a Washington Corporation, Defendant,

No. 83-CV-2217-DT. Ultimately, a Default Judgment was en-

tered against the Defendant, Chem-Nuclear Systems, Inc. and

sanctions were imposed pursuant to Fed.R.Civ.P. 11 personally

(Continued on following page)

STATUTORY PROVISIONS AND COURT RULES

INVOLVED

Fed.R.Civ.P. 11 is set forth as Appendix a.

——$—$—$$__<_<___Q-——_—_—_—_————_

STATEMENT OF THE CASE

Petitioner’s Statement Of The Case omits several key

points relating to this Petition, and therefore Respondent

must present its own statement of the case.

Chem-Nuclear Systems, Inc., a subsidiary of a multi-

national waste disposal firm, Waste Management Corpo-

ration, agreed to pay Respondent, Invst Financial Group

Inc., (‘‘Invst’’) a finder’s fee for introducing Chem-

(Continued from previous page)

upon the Petitioner, C. William Garratt, as trial counsel for

Chem-Nuclear. Chem-Nuclear Systems, Inc. took an appeal

From the Default Judgment to the United States Court of Ap-

peals for the Sixth Circuit, Appeal No. 85-1731. Petitioner, C.

William Garratt filed two (2) appeals with respect to the District

Court’s rulings, the first of which, No. 85-1732, was dismissed

on December 9, 1985 for untimeliness and Garratt’s lack of

standing to challenge the merits of Orders denying his Motions

to disqualify the Hon. Horace W. Gilmore as presiding Judge

over the District Court action. His second Notice of Appeal,

Appeal No. 85-1888, sought review of the final Order imposing

monetary sanctions upon him and was captioned in the Sixth

Circuit as In Re: C. WILLIAM GARRATT and GARRATT & MOR-

RIS. P.C. That appeal was argued before the Sixth Circuit at

the same time as Chem-Nuclear’s No. 85-1731 but a Sixth Circuit

interim Order refrained from consolidating the appeals. Never-

theless, in its Opinion the Sixth Circuit treated the two matters

as “a consolidation of two cases which arose out of a common

set of facts’. 815 F.2d 391, 394; A-2.

Pursuant to S.Ct.R. 28.1, Respondent declares it has no

parent, subsidiary or affiliate corporations.

3

Nuclear to corporate merger or acquisition candidates.

After Invst introduced Chem-Nuclear to a company called

Hanchar Industrial Waste Management, Inc., a dispute

arose over whether a finder’s fee was owing Invst. The

underlying suit was then initiated by Invst against Chem-

Nuclear on June 3, 1983 in the District Court to recover the

fee.

Proceedings In The District Court

Sometime after receipt of the suit papers, counsel for

Chem-Nuclear, the Petitioner, C. WILLIAM GARRATT

(‘‘Garratt’’), on or about August 10, 1983 phoned counsel

for Respondent, Mark KE. Reizen, requesting an extension

of time to answer. As a professional courtesy, Reizen

agreed to an extension fer a reasonable but unspecified

amount of time to answer only, thus indicating that under

no cireumstances would the extension be afforded to file

motions or counterclaims. When Garratt’s answer was not

soon forthcoming, Reizen wrote to him on four (4) sep-

arate occasions—September 7, 1983, December 1, 1983,

February 3, 1984 and June 25, 1984—requesting a status

report, some action or response. Garratt never re-

sponded to these written inquiries. Phone calls proved

similarly unavailing. Although Reizen attempted to con-

duet discovery in the case, those efforts were completely

frustrated by Garratt’s delaying and _ stalling tacties.

.

- A Federal Magistrate entered three (3) separate Orders

compelling Chem-Nuclear to file meaningful responses to Re-

spondent’s initial set of Interrogatories, and two (2) of those

Orders impose monetary sanctions for dilatory tactics. Garratt

effectively, therefore, never provided any meaningful discovery

while the case was pending in the District Court and further

failed to file a witness list by September 15, 1983, as required

by the District Court's Pre-Trial Order.

Finally, on June 25, 1984, Reizen revoked all extensions of

time with respect to all aspects of the ease. He stated,

Discovery in this matter on behalf of your client has

been dilatory at best, and it appears that I will no

longer be able to accommodate you with requests for

extensions of time with regard to any matter on this

file. From this point onward, I expect timely re-

sponses to all pleadings filed in this matter and I

will not hesitate to seek the Court’s protection from

this point onward.

(The Trial Judge read this letter into the record on No-

vember 15, 1984, Tr. 8-9).

Having gained tactical advantage through obfuscation

and delaying tacties, Garratt thereafter, on October 3, 1984,

filed an answer with counterclaims on the eve of trial (set

for January, 1985) and some three (3) weeks before discov-

ery cut-off (November 1, 1984). Respondent promptly

moved to strike these pleadings because no Order of exten-

sion had been presented or entered which would permit

Chem-Nuclear to plead sixteen (16) months after service,

and because counsel for Respondent had long since (some

three (3) months earlier) explicitly revoked any exten-

sions of time earlier provided as professional courtesies

to Garratt.

The District Court, the Honorable Horace A. Gilmore,

heard the Motion to Strike on November 15, 1984 and ex-

plicitly determined that there was no excuse for the fail-

ure of Garratt to file a responsive pleading for over six-

teen (16) months or to seek an out of time enlargement to

plead pursuant to Fed.R.Civ.P. 6(b)(2). In the terms of

that Rule, the District Court determined that there was

‘‘no excusable neglect’’ for Garratt’s conduct. Moreover,

the District Court further found that counsel for Respon-

dent had, at least as of the date of the June 25, 1984 letter,

clearly terminated any consent to further extensions of

time for Chem-Nuclear to plead. Finally, Judge Gilmore

citing this Court’s decision in Link v. Wabash RR., 370

U.S. 626 (1962), rejected Garratt’s suggestion that his

professional negligence should not be imputed to his client,

Chem-Nuclear. In view of this, the District Court struek

the tardy answer and counterclaims and subsequently en-

tered Default on January 17, 1985.

Thereafter, Garratt greatly multiplied the proceed-

ings and ultimately was sanctioned for his conduct in that

regard. Due to a death in the District Judge’s family, an

Order striking the pleadings pursuant to the November

15th ruling was not entered until November 30, 1984. This

interlude gave Garratt an opportunity to file a Motion to

Dismiss for Insufficiency of Service Process and a Motion

for Summary Judgment and/or Judgment on the Plead-

ings. Respondent, Invst moved the Distriet Court for

entry of default and default judgment on December 5, 1984

and opposed Garratt’s Motions to Dismiss and for Sum-

mary Judgment contending they were frivolous. Invst’s

Motion for Default and Default Judgement and Garratt’s

Motion to Dismiss and for Summary Judgment were set

down for hearing for January 17, 1985.

; In all likelihood, these papers could never have been filed

with the District Court Clerk if the Order striking the pleading

had been promptly issued in due course since Chem-Nuclear

would have been effectively in a state of default. Further, Invst

was prohibited from obtaining a clerk’s entry of default because

the clerk found Garratt’s stricken answer and later his Motion

to Dismiss extant in the Court's file.

6

Before argument began on the pending Motions that

were called on January 17, 1985, Garratt’s partner, with-

out any supportive papers or affidavits and without any

prior notice to opposing counsel or the Court, announced

that he was orally moving for recusal of Judge Gilmore

and was doing so because a ‘‘respeeted attorney’’ in the

Detroit area had wanted to make the Motion but was in-

disposed. The Court summarily denied that Motion for

Recusal because it was orally made and unaccompanied by

an affidavit as required by statute, 28 U.S.C. § 144.

The District Court then turned its attention to the

pending Motions and heard argument on the same. With

respect to Garratt’s Motion to Dismiss for alleged insuf-

ficieney of service of process brought under Fed.R.Civ.P.

12(b)(5), the District Court characterized it as ‘‘outrage-

ous’’. Garratt had already filed an answer and counter-

claims on behalf of Chem-Nuclear which had not raised any

such defenses. Only after those pleadings were stricken,

did Garratt attempt to argue that Chem-Nuclear had

merged into a wholly owned subsidiary of its parent ecom-

pany, no longer existed and therefore was ineapable of

receiving service of process. The District Court stated

that it did not understand how an officer of the Court could

say two things so completely contrary within the space of

six (6) weeks. Relying on the express provisions of Fed.

R.Civ.P. 12(h)(1), the District Court determined that the

elaim of insufficiency of service of process had not been

raised in a timely manner, clearly had been waived and

further concluded that the argument had not been made in

good faith and was ‘‘outrageous’’.

With respect to Garratt’s Motion for Summary Judg-

ment, much of it reiterated the contentions made in the

Motion to Dismiss. The District Court rejected the re-

mainder of the arguments concerning that motion because

Chem-Nuclear’s answer had been stricken. It reasoned

that Chem-Nuclear was precluded from defending in sum-

mary proceedings because its procedural default prohibited

it from contesting the merits of liability at trial.

The District Court also determined that Rule 11 sane-

tions were warranted, characterizing Garratt’s Motion to

Dismiss ‘‘outrageous’’ in the face of the explicit waiver

provisions of Rule 12(h)(1). The District Court also

deemed that the Motion for Summary Judgment was sance-

tionable, reasoning that if a party was foreclosed from

contesting the merits of an action in view of a procedural

default, it follows, a fortior:, that party will necessarily be

foreclosed from contesting the merits of the case via the

summary judgment device.4 A hearing on the Default

Judgement was adjourned for one (1) week, 7.e., until Jan-

uary 24, 1985, and the Court determined it would conduct

a hearing on a Petition for Rule 11 sanctions in two (2)

weeks, t.e., January 31, 1985.

When the case was called on for the Default Judg-

ment hearing on January 24, 1985, Garratt’s partner, again

without prior notice to counsel or the Court, sought to

address the reeusal of Judge Gilmore from presiding over

the ease for a second time. This time, Garratt filed a

‘ See Thomson v. Wooster, 114 U.S. 104, 114 (1885) (de-

fault absolutely bars and precludes defendant from alieging any-

thing in derogation of, or in opposition to plaintiff’s claims);

Breuer Electric Mfg. Co. v. Toronado Systems of America, Inc.,

687 F.2d 182, 186 (7th Cir. 1982) (court refuses to consider mo-

tion for directed verdict at close of default judgment damages

hearing because, inter alia, such would reopen the question of

liability foreclosed by entry of default).

lengthy written application accompanied by two (2) affi-

davits: one of Garratt as counsel for Chem-Nuclear, and an-

other signed by various attorneys in his office. Garratt’s

affidavit merely alleged, in conclusory terms, that Judge

Gilmore had made erroneous rulings against him and the

attorneys in his law firm in this and other actions. Gar-

ratt also disclaimed that he had acted in bad faith or had

violated Rule 11. The second affidavit, again in econelu-

sory fashion, communicated the subjective belief of the

attorneys in Garratt’s firm that Judge Gilmore was biased

and prejudiced against Garratt.. No affidavit of a

‘‘narty’’, u.e., of any representative or officer of Chem-

Nuclear, was presented with the application.

Judge Gilmore immediately referred the matter pur-

suant to 28 U.S.C. § 144 to another Judge, the Honorable

Robert DeMascio, who was chosen by a blind draw system

to hear the matter. Judge DeMascio expeditiously dealt

$ Incredibly, Garratt also attempted thereafter to supplement

the application for recusal by presenting a wholly frivolous af-

fidavit of a licensed polygraph examiner who stated that it was

her professional opinion that the lawyers in Garratt’s firm be-

lieved that Judge Gilmore was biased against Garratt and his

firm. Garratt also attempted to support his argument for dis-

qualification of Judge Gilmore by attaching applications for

recusal of Judge Gilmore he had filed in three (3) previous

cases. However, as pointed out by Respondent in its papers

opposing the application, Garratt completely failed to advise

in his application that District Judges Ralph Guy and James P.

Churchill ultimately denied Garratt’s Motions to Disqualify in

two (2) of the cases to which he made reference. In the third,

Judge Gilmore voluntarily recused himself stating that he had

no bias against Garratt, but believed an appearance of impro-

priety might arise because he had disqualified Garratt and his

firm from representing a party due to their involvement as

witnesses in another case which was on appeal. See 815 F.2d

391, 396 n.1; A-6 n.1.

9

with Garratt’s Motion for Disqualification finding it clear-

ly unmeritorious under controlling precedent. (His Feb-

ruary 21, 1985 Order is included herein as Appendix b).

Judge DeMascio determined that all the allegations of bias

against Garratt concerned judicial actions taken by Judge

Gilmore in the present and past ecases—actions which were

legally insufficient to require disqualification under South-

erland v. Irons, 628 F.2d 978 (6th Cir. 1980). Judge De-

Mascio also determined that the Motion represented yet

another demonstration of a lack of good faith in defending

the action warranting Rule 11 sanctions, the imposition of

which was more properly left to Judge Gilmore,

Subsequent to Judge DeMascio’s denial of the Motion

for Disqualification, the Court and the parties again

turned to the matter of sanctions. Garratt continued to

file voluminous supplemental briefs and motions until his

client Chem-Nuclear retained new counsel on April 3, 1985.

On April 18, 1985, Judge Gilmore conducted a hearing with

respect to sanctions wherein Chem-Nuclear was _ repre-

sented by new counsel and Garratt was represented by

counsel of his choice. Garratt and his counsel were given

every opportunity to present any matters with respect to

sanctions at that hearing. After Garratt’s counsel had

made a presentation, and after argument had been heard

from all counsel involved, Judge Gilmore determined that

sanctions should be imposed personally upon Garratt for

filing the Motions to Dismiss, for Summary Judgment and

for Disqualification. The matter of amount of the sanc-

tions to be imposed was referred to a United States Magi-

strate to act as a Special Master under Fed.R.Civ.P. 53.

The Magistrate conducted a hearing over two (2) trial days

with Garratt being represented by counsel. Counsel had

10

the right to, and did cross-examine counsel for the Respon-

dent and further called witnesses and presented extensive

documentary evidence and written argument. Thereafter,

the Magistrate recommended sanctions be imposed in the

amount of $14,258.75. After yet another hearing with

Garratt having a full and adequate opportunity to appear

and be heard through counsel, Judge Gilmore reduced the

Magistrate’s award to $14,167.50.

On August 8, 1985, Default Judgment was entered in

favor of Invst against Chem-Nuclear. Chem-Nuclear ap-

pealed the entry of Default Judgment via a timely Notice

of Appeal. On October 9, 1985, Judge Gilmore ‘entered an

Order for Payment of Actual Attorney Fees to Invst in

the amount of $14,167.50 against Garratt to which he filed

a Notice of Appeal to the United States Court of Appeals

for the Sixth Cireuit.

Proceedings In The Court Of Appeals

After Chem-Nuclear secured new counsel, it explicitly

elected not to appeal the Motion to disqualify Judge Gil-

more that had been filed by Garratt on its behalf. Garratt

unsuccessfully attempted to seek review on the merits of

the disqualification orders.®

. By a separate appeal, No. 85-1732, filed on September 18,

1985, Garratt attempted to appeal Judge Gilmore’s denial of

Garratt’s oral Motion for Recusal made on January 17, 1985

and of Judge DeMascio’s February 21, 1985 Order denying

Garratt’s written Motion to Disqualify Judge Gilmore. The Sixth

Circuit, in an Order dated December 9, 1985 (Appendix c),

dismissed Garratt’s appeal for untimeliness and for lack of

standing to challenge the merits of the disqualification Order.

11

The Chem-Nuclear Appeal

With respect to the merits of Chem-Nuclear’s appeal,

the Sixth Cireuit, in a reported opinion, 815 F.2d 391, 397-

400 (6th Cir. 1987); A-8 to A-15, reversed entry of the De-

fault Judgment and remanded the case to the District with

directions to set aside the Default, to reinstate Chem-Nu-

clear’s Answer and for further proceedings.’ Respondent

’ The Court of Appeals readily acknowledged that the Dis-

trict Court found that Garratt’s sixteen (16) month delay in fail-

ing to plead or to seek an extension of time under Fed.R.Civ.P.

6(b)(2) was ‘inexcusable’. See Sony Corp. v. Elm State Elec-

tronics, Inc., 800 F.2d 317, 319 (2d Cir. 1986) (party seeking

enlargement under Rule 6(b) must establish “excusable neg-

lect’); Traguth v. Zuck, 710 F.2d 90, 93-94 (2d Cir. 1983) (same);

In Re: Sonoma V, 703 F.2d 429, 431-32 (9th Cir. 1983) (same);

Orange Theatre Corp. v. Rayherstz Amusement Corp., 130 F.2d

185, 187 (3d Cir. 1942) (en banc) (obtaining an enlargement

order under Rule 6(b) necessary even when extension is granted

by adverse party). Nevertheless it vacated the Default Judgment,

expressing its strong disfavor of pretermitted proceedings.

Relying upon its own decisions in Shepherd Claims Ser-

vices Inc. v. William Darrah & Assoc., 796 F.2d 190 (6th Cir.

1986) and United Coin Meter Co. v. Seaboard Coastline RR.,

705 F.2d 839 (6th Cir. 1983), the Sixth Circuit concluded that all

ambiguous or disputed facts had to be construed in a light most

favorable to the defaulted party and that any doubt had to be

resolved in favor of that defaulted party. 815 F.2d at 397-398.

While the District Court had determined that the Respondent's

counsel’s June 25, 1984 revocation of extensions “as to any

matter on this file’ was unambiguous, the Court of Appeals

panel engaged in de novo review and determined that the letter

was ambiguous, apparently because it was written in the con-

text of a discovery dispute. 815 F.2d at 399-400; A-13. The panel

reached this conclusion without making reference to the Dis-

trict Court’s supplemental reliance upon Respondent’s coun-

sel’s other letters of September 17, 1983, December 1, 1983

and February 3, 1984 as well as upon Garratt’s numerous oral

promises representing he would file responsive pleading.

(Continued on following page)

12

must submit that the Court of Appeals ruling with respect

to vacating the Default Judgment was erroneous, repre-

sents an unwholesome ‘‘sporting chance’’ theory of pro-

cedure and encourages a degree of laxity and unprofes-

sional conduct on the part of counsel which has never been

recognized by this Court. Indeed, the Sixth Court’s em-

ployment of a standard of review that is highly deferential

to the defaulted party (as opposed to the District Court)

has specifically been rejected by recent decisions of other

Courts of Appeals. See Tolliver v. Northrop Corp., 786

F.2d 316 (7th Cir. 1986); C.K.S. Engineers, Inc. v. White

Mountain Gypsum Co., 726 F.2d 1202, 1095-06 (7th Cir.

1984); United States v. DeFrantz, 708 F.2d 310 (7th Cir.

1983); Breuer Electric Mfg. Co. v. Toronado Systems of

America, Inc., 687 F.2d 182 (7th Cir. 1982). See also Benny

v. Pipes, 799 F.2d 489, 492 (9th Cir. 1986), amended, 807

F.2d 1514 (9th Cir. 1987); Dimmitt @ Owens Finc., Inc. v.

United States, 787 F.2d 1186, 1192-93 (7th Cir. 1986).

Moreover, when a party has been sanctioned for dilatory

tactics as Garratt was here, whether by default, dismissal

or other sanction, this Court has been insistent that the

District Court’s decision be narrowly reviewed by any

appellate court under a highly deferential standard—a

standard which recognizes the deterrent function such

(Continued from previous page)

In view of the purported ambiguity found by the Court

of Appeals, it determined that the Default Judgment had to be

vacated to “prevent manifest injustice’. 815 F.2d at 400; A-14.

Somewhat surprisingly, the panel did this in the context of

forthrightly acknowledging that Garratt had been ‘careless and

negligent’ 815 F.2d at 400; A-14 and further that he had

abused professional courtesies graciously extended to him by

counsel for Respondent to the extent of rendering the Federal

Rules of Procedure meaningless. /d.

13

sanctions are to generally play within the federal court

system. National Hockey League v. Metropolitan Hockey

Club, Inc., 427 U.S. 639, 641-643 (1976). See also Insur-

ance Corp. of Ireland Ltd. v. Compagnie des Bauxite de

Guinee, 456 U.S. 694, 707-709 (1982); Roadway Exp., Inc.

v. Piper, 447 U.S. 752, 763-764 (1980).8 Although the Re-

spondent believes that the Court of Appeals erred in re-

versing the Default Judgment, Respondent has subse-

. Respondent must note that the Court of Appeals leniency

with respect to Garratt’s admitted professiona! negligence in

failing to plead for over sixteen (16) months was erroneous if

only because of its de novo review of the record on the pre-

text that it was not necessary to show a “glaring” abuse of dis-

cretion to upset a Default Judgment. See 815 F.2d at 397-399.

If nothing else, this action contravened decisions of this Court

which strongly defer resolution of factual matters, including

imposition of ultimate sanctions, as peculiarly within the Dis-

trict Court’s charge and expertise—undertakings which con-

versely cannot, and should not be duplicated by appellate courts

reviewing cold records. See National Hockey League v. Metro-

politan Hockey Club, Inc., 427 U.S. 639, 641-43 (1976) (court

of appeals reversed by this Court for leniency evidenced in its

opinion reversing a district court’s dismissal under Rule 37 as

too severe a sanction): Tolliver v. Northrop Corp., 786 F.2d 316,

318 (7th Cir. 1986) (National Hockey establishes that ultimate

sanction entered by district court is protected by “highly def-

erential review” by appellate courts). See also Anderson v.

City of Bessemer City, N.C., 105 S.Ct. 1504, 1511-12 (1985)

(appellate court is not to second guess a district court as to fac-

tual matters and must affirm factual findings absent their being

clearly erroneous); Brown v. Wesley’s Quaker Maid, Inc., 771

F.2d 952, 956 & n.4 (6th Cir. 1985), cert. denied, 107 S.Ct. 116

(1986) (same).

These decisions establish the narrow scope of review that

should have been employed by the panel with respect to the

Default Judgment. Of even greater significance, they under-

score the fact that the Sixth Circuit gave Garratt the benefit of

every doubt in rendering its opinion—affording him far more

protection than he deserved or was entitled to—and still ceter-

mined that his conduct in filing the Motion to Disqualify Judge

Gilmore was unquestionably sanctionable.

iniameaneenie

14

quently resolved its dispute with Chem-Nuclear in the un-

derlying District Court action which has been dismissed

with prejudice pursuant to a settlement between those

parties.

The Matter Of Sanctions

The Court of Appeals then turned its attention to the

matters of sanctions against Petitioner, Garratt. The

Court initially noted that once a violation of Fed.R.Civ.P.

11 was found, the District Court was required to impose

sanctions under Rule 11 as modified by its 1983 Amend-

ments. 815 F.2d at 391; A-17, citing, Albright v. Upjohn

Co., 788 F.2d 1217, 1221-22 (6th Cir. 1986) ; Westmoreland

v. CBS, Inc., 770 F.2d 1168, 1174 (D.C. Cir. 1985); Davis

v. Veslan Enterprises, 765 F.2d 494, 497 (5th Cir. 1985) ;

advisory committee notes to 1983 amendments to Rule 11.

Although the panel recognized the District Court’s impo-

sition of sanctions was to be reviewed under the limited

abuse of discretion standard, 815 #'.2d at 401-402; A-17, it

nevertheless engaged in a careful—and what was tanta-

mount to a de novo—review of the record regarding sane-

tions.

With respect to Garratt’s Motion to Dismiss for In-

sufficiency of Service of Process under Fed.R.Civ.P. 12(b)

(5), the panel readily determined that ‘‘even a cursory

review of Rule 12 would have revealed the defense lacked

any foundation in law’’ and affirmed Judge Gilmore in

properly sanctioning Garratt for filing it. 815 F.2d at

403; A-20. The Court also determined that Judge Gil-

more’s characterization of this argument as ‘‘outrageous’’

constituted an understandable response to a Motion that

was patently without merit. 815 F.2d at 402-03; A-19, 20.

15

The Sixth Cireuit reversed entry of sanctions against

Garratt for filing the Motion for Summary judgment, rea-

soning that although Garratt’s pieadings had been stricken

at the time he filed the Motion for Summary Judgment on

November 30, 1984, the Motion for Summary Judgment

did not violate any procedural rule and raised potentially

meritorious defenses. Accordingly, it determined that

sanctions were not appropriate with respect to that Mo-

tion.? Respondent has not elected to burden this Court

with a cross-petition for certiorari challenging this ruling

because this case simply does not warrant review of any

type in this Court.

As Garratt has not elected to petition this Court to

review the Court of Appeals’ affirmance of the sanction

imposed upon him for filing the clearly frivolous Motion

to Dismiss, the only aspect of the Court of Appeals’ ruling

that is before this Court is the Sixth Cireuit’s affirmance

of District Judges Gilmore’s and DeMascio’s sanctioning

Garratt for filing the clearly frivolous Motion for Dis-

qualification of Judge Gilmore. In its ruling, the Sixth

Circuit recognized that Rule 11 as amended requires the

imposition of sanctions when a pleading, motion, or other

court paper 1) is not well grounded in fact; 2) is not war-

ranted by existing law or a good faith argument for ex-

tension of existing law; or 3) is filed for an improper pur-

pose such as delay. The Court found that Garratt’s Mo-

° Respondent continues to maintain that because Chem-

Nuclear’s pleadings had been stricken such that it was unable

to defend as to the merits of the suit, Chem-Nuclear was in a

state of default which precluded Garratt from filing a Motion

for Summary Judgment. See Thomson v. Wooster, 114 U.S. at

114; note 4 supra.

scicaeanaiaieee

16

tion for Disqualification violated all three (3) sanctionable

circumstances of Rule 11. 815 F.2d at 402; A-18. First,

the Motion was not well grounded in fact because Garratt

advanced no new facts or legal arguments to support the

Motion. In fact, the panel found it to be identical to ones

that had been filed in other cases and denied by Judges

Guy and Churchill.

Second, the Court of Appeals also readily determined

that Garratt’s Motion was not warranted by existing law

or a good faith argument for extension of existing law.

The explicit holding of Southerland v. Irons, 628 F.2d 978,

980 (6th Cir. 1980) required proof of extrajudicial preju-

dice or bias thus rendering irrelevant the actions of a judge

in pending or previous litigation as grounds for disqualifi-

cation. 815 F.2d at 402; A-19. Garratt’s motion sup-

ported by his own conclusory affidavits flagrantly ignored

this clearly controlling precedent. Garratt’s citation of

eases that he contended represented an exception to this

general rule were readily rejected by the Court of Appeals

as not remotely similar factually. 815 F.2d at 402-403;

A-19, 20. The fact that Judge Gilmore commented that

certain of Garratt’s legal arguments were ‘‘outrageous’’—

and in fact were outrageous—wasn’t remotely similar to

the injudicious comments made in the cases Garratt pur-

ported to rely upon.

Third, as anyone familiar with the record would have

to conclude, the panel quickly determined that Garratt

transparently filed the Motion for Disqualification to delay

the Default Judgment hearing. 815 F.2d at 402; A-18.

The Court also recognized that Garratt’s Motion was un-

17

timely since it was brought not at the beginning, but at the

conclusion of the case. 815 F.2d at 402; A-18.

°

REASONS WHY THE WRIT SHOULD BE DENIED

Introduction

Garratt now seeks review in this Court of the award

of sanctions against him for filing the Motion to Disqualify

Judge Gilmore raising yet another frivolous claim (Pet.

for Cert. Question 1) that such violates his First and Fifth

Amendment rights guaranteed by the Constitution of the

United States. He also reiterates his argument (Pet. for

Cert. Question 2) made to the Court of Appeals that his

Motion for Disqualification of Judge Gilmore was justified

in view of his self-serving declaration of actual or apparent

bias or prejudice on the part of Judge Gilmore.

I.

THE QUESTIONS PRESENTED DO NOT WAR.

RANT REVIEW IN THIS COURT AND, MORE.

OVER, ARE FRIVOLOUS.

Initially, the Court should note that Garratt seeks re-

view of factual determinations made by the District Court

to the effect that no bias or prejudice within the meaning

of 28 U.S.C. § 144, § 455 was established. In Garratt’s

petition for certiorari (Question 2) he seeks de novo re-

view in this Court of those factual determinations claiming

that bias was shown J) by the District Judge’s acceptance

of Respondent’s counsel’s June 25, 1984 letter as unam-

biguously revoking any extensions of time previously ex-

18

tended to Garratt and 2) by the District Judge’s failure

to vacate the Default Judgment. Apparently, Garratt be-

lieves that because the Sixth Cireuit ultimately determined

that the District Judge erred in making those findings and

determinations, he has established bias. ‘his in itself con-

s'itutes yet another violation of Rule 11 since it is mani-

fest that a judge cannot be recused because he commits

error. As Circuit Judge Aldridge recently stated, ‘‘a

judge cannot be acceptable if he finds in your favor, but

unqualified when he finds against you. This is classic

heads-I-win, tails-you-lose’’. Ricci v. Key Bancshares of

Maine, Inc., 111 F.R.D. 369, 377 (D.Me. 1986).

Garratt further compounds his lack of good faith re-

garding his second question presented for review by con-

tending 3) that his Motion to Disqualify Judge Gilmore

was justified in view of his claim that the Judge made a

‘(Freudian slip’’ at one of the hearings by calling the case

“‘Invst v. Garratt Chem-Nuclear’’. The official Court Re-

porter that transcribed the particular hearing, however,

certified that the District Judge made no such statement.

Although Garratt concedes this was never part of the

record and indeed, that he was unsuccessful in getting the

Court of Appeals to correct the record to reflect his recol-

lection of how the case was called, he nevertheless continues

to belabor such an irrelevancy in this the highest Court in

the land.

Garratt’s ‘‘constitutional issue’’ (Question 1) is equal-

ly meritless. Indeed, the argument that Garratt was denied

the opportunity to be heard is frivolous and offered in bad

faith. As the Court of Appeals expressly noted, Garratt

was given far more adequate process than was due him,

19

815 F.2d at 405; A-24, 25, being permitted to express his

views in multiple hearings before, and presentations to

two (2) United States District Judges and a United States

Magistrate. Indeed he retained counsel who had an un-

encumbered right to cross-examine Respondent’s counsel,

to call, examine and cross-examine other witnesses and to

present documentary evidence. Further, the record in

this matter is full of his prodigious written arguments and

presentations. Equally outrageous is Garratt’s claim of

a denial of due process because Judge Gilmore acted as

‘faecuser, fact finder, judge and executioner’’ (Pet. 12) in

the face of the fact that one United States Magistrate, two

United States District Court Judges, and a panel of the

United States Court of Appeals have duly considered and

rejected Garratt’s contentions.

Garratt’s constitutional claims under the First Amend-

ment are not only frivolous, but hardly comprehensible.

Apparently, Garratt believed he enjoys some absolute,

First Amendment right to make frivolous Motions for Dis-

qualification. He attempts to justify this belief by sweep-

ingly erand and thunderous references to the Court of

Appeals’ decision precipitating an ‘‘apoealyptie’’ inhibi-

tion oi lawyers from zealously representing their clients

(Pet. 13) and of the advent of ‘‘judicial tyranny’’. (Pet.

20). Garratt says the Court of Appeals’ ruling will also

have ‘‘a chilling effect’? on attorneys’ zeal to represent

their clients’ interests. This position is untenable and begs

the question. Garratt’s Motion for Disqualification has

been found frivolous and sanctionable by two (2) District

Judges, a Magistrate and a panel of the Court of Appeals.

If it is his contention that the First Amendment gives him

absolute immunity to file such frivolous pleadings and to

20

subvert and delay the judicial process, then his under-

standing of that Amendment is thoroughly out of touch

with any of the decisions of this Court. In fact, the 1983

Amendments to Rule 11 were actually designed and im-

tended to have a ‘‘chilling effect’’ upon conduct such as

Garratt’s. This Court has on more than one occasion con-

strued (and applauded) sanction provisions of the Federal

Rules of Civil Procedures so as to serve the important de

terrent function of inhibiting unacceptable delay and mis-

conduct. National Hockey League, 427 U.S. at 642-43

(Rule 37 sanctions).

Correlatively, if Garratt’s conention is that his Mo-

tion to Disqualify should have been granted, then his claims

have nothing to do with the First Amendment but instead

simply turn upon the legal sufficiency of the Motion. As

the District Judges and the Court of Appeals properly

found, the motion had no merit whatsoever.'®

10 As earlier described, Chem-Nuclear did not appeal the

merits of Judge DeMascio’s denial of the Motion to Disqualify

Judge Gilmore. The Court of Appeals further held in Garratt’s

appeal No. 85-1732 that Garratt did not have standing to chal-

lenge the merits of that Disqualification Order and did not

perfect that appeal in any event. Garratt did not seek review

in this Court of that ruling. Therefore, Judge DeMascio’s ruling

denying the Motion to Disqualify is the law of the case which

cannot be reviewed by this Court. This makes Garratt’s Petition

particularly unsuited as a vehicle for this Court to generally dis-

cuss the interrelationship between Rule 11 and disqualification

as Garratt suggests.

21

II.

THE COURT OF APPEALS WAS FULLY JUSTI-

FIED IN AFFIRMING THE IMPOSITION OF SANC-

TIONS AGAINST THE PETITIONER UNDER UNI-

VERSALLY RECOGNIZED PRINCIPLES OF LAW

AND THEREFORE REVIEW IN THIS COURT IS

NOT WARRANTED.

The Sixth Cireuit, Judge DeMascio and Judge Gil-

more relied upon the Sixth Circuit’s decision in Souther-

land v. Irons, 628 F.2d 978 (6th Cir. 1980) in finding Gar-

ratt’s Motion for Disqualification wanting under Rule 11.

The Southerland case clearly had recognized the ‘‘well

settled [rule] that actions of a judge in pending or pre-

vious litigation in which the movant has been involved are

not grounds for disqualification’’. Southerland, 628 F.2d

at 980, citing Sexton v. Kennedy, 519 F.2d 797 (6th Cir.

1975); Knoll v. Socony Mobil Oil Co., 369 F.2d 425, 430

(10th Cir. 1966), cert. denied, 386 U.S. 977 (1967) ; Barnes

v. United States, 241 F.2d 252 (9th Cir. 1956). The Sixth

Cireuit was completely correct in its articulation of this

rule and in its recognition of the fact that Garratt’s effort

completely ignored or discounted the universal character

of its application.

To demonstrate the strength of this point, one need

only look to the recent decision of Aetna Life Ins. Co. v.

Lavoie, 106 8.Ct. 1580, 1584-85 (1986) wherein this Court

recognized the traditional common-law rule that disquali-

fication for bias or prejudice was not permitted. ‘‘As

Blackstone put it, ‘the law will not suppose a possibility

of a bias or favour in a judge, who has already sworn to

administer impartial justice, and whose authority greatly

oS

depends upon that presumption and idea.’ ’’ Id., citing 3

W. Blackstone, Commentaries, * 361. This Court further

noted, however, that ‘‘the more recent trend has been

towards the adoption of statutes that permit disqualifica-

tion for bias or prejudice’’. Aetna Life Ins. Co., 106 S.Ct.

at 1585.

Aetna Life Ins. involved a challenge under the due

process clause to a court’s refusal to disqualify one of its

justices when no intervening regulation or statute con-

trolled the terms of such disqualification. By contrast,

Acts of Congress, 28 U.S.C. § 144, § 455, far exceeding the

minimal constitutional requirements of the due process

clause, control the situations under which a presiding fed-

eral judge may be recused. Accordingly, it is those stat-

utes which controlled the determination as to whether or

not Judge Gilmore should have been disqualified from

presiding over the underlying action and whether or not

Garratt violated Rule 11 in seeking Judge Gilmore’s re-

cusal.

The plain language of those provisions, and indeed of

the first clause of 28 U.S.C. § 144, establish the frivolous-

ness of Garratt’s Motion for Disqualification. 28 U.S.C.

§ 144 provides in part that, ‘‘|w]henever a party... makes

and files a timely and sufficient affidavit that the judge

... has a personal bias or prejudice either against him or

in favor of any adverse party... .’’ (emphasis supplied).

As already noted, it was Garratt—the attorney for Chem-

Nuclear—that filed an affidavit in this case, not a repre-

sentative or officer of Chem-Nuclear.

The statute has two (2) significant ramifications with

respect to its choice of the term ‘‘party’’. First, the plain

23

meaning of the literal word ‘‘party’’ requires that a

‘‘party’’, not an attorney be the affiant. Several Courts

of Appeals have construed the statute’s reference to

‘‘party’’ as not to include counsel within its sweep. See,

e.g., Gilbert v. City of Little Rock, Ark., 722 F.2d 1390,

1398 (Sth Cir. 1983), cert. denied, 466 U.S. 972 (1984);

Davis v. Loard of School Commissioners, 517 F.2d 1044,

1050 (Sth Cir. 1975), cert. denied, 425 U.S. 944 (1976);

United States v. IBM Corp., 475 F.Supp. 1372, 1383 (S.D.

N.Y. 1979). Cf. also United States ex rel, Wilson v. Cough-

lin, 472 I'.2d 100, 104 (7th Cir. 1973); Giebe v. Pence, 431

F.2d 942, 948 (9th Cir. 1970).

Second, the statute, in view of its use of the terms

‘‘bias’’ and ‘‘prejudice’’ as being the touchtones which

trigger disqualification, have universally been interpreted

as terms of art to refer to a judge’s actions or conduct

occurring outside of the performance of his or her judi-

cial duties. As those decisions unequivocally state, the

only type of bias or prejudice which will warrant disquali-

fication is ‘‘extradjudicial’’ bias or prejudice. This Court

squarely established such a construction when it stated

that, ‘‘the alleged bias and prejudice to be disqualifying

must stem from an extrajudicial source and result in an

opinion on the merits on some basis other than what the

judge learned from his participation in the ease’’. United

States v. Grinnell Corp., 384 U.S. 563, 583 (1966), citing,

Berger v. United States, 255 U.S. 22, 31 (1921) (same).

See also Moore v. McGraw Edison, 804 F.2d 1026, 1032

(Sth Cir. 1986) (antipathy toward an attorney is not in-

dicative of extrajudicial bias against a party); United

States v. Pugliese, 805 F.2d 1117, 1125 (2d Cir. 1986);

In Re: IBM Corp., 618 F.2d 923, 928 (2d Cir. 1980) ; Davis

24

v. Board of School Commissioners, 517 F.2d at 1052 (con-

troversy with lawyers in the matter at bar does not con-

stitute extrajudicial conduct). The fact that the Sixth

Cireuit in Southerland followed the rule set down by this

Court in Grinnell and Berger and followed by other Courts

of Appeals underscores the frivolousness of Garratt’s Mo-

tion.!!

sig Simply put, “antipithy to an attorney is insufficient

grounds for disqualification of a judge because it is not indica-

tive of extrajudicial bias against a party’. Moore v. McGraw

Edison, 804 F.2d at 1032. Garratt’s attempt to fall into some ex-

ception to this overarching principle was also frivolous. Namely,

Garratt claimed two (2) decisions recognized limited circum-

stances where bias or prejudice directed toward an attorney

might give rise to a need for a judge to be disqualified. See

Pet. at 12, citing, Nicodemus v. Chrysler Corp., 596 F.2d 152

(6th Cir. 1979); United States v. Ritter, 540 F.2d 459 (10th Cir.),

cert. denied, 429 U.S. 951 (1976).

Nicodemus, which was authored by Judge Keith who sat

on the panel of the Sixth Circuit in this matter, determined that

a district judge had to be disqualified for making flagrantly

inappropriate and intemperate remarks from the bench about

a party and its representatives. Moreover, the district judge also

rendered a retaliatory award of damages against that litigant,

notwithstanding his admission that such was not necessarily

justified under substantive law but rather was a measure de-

signed to punish the litigant.

Garratt’s attempt to rely upon the Ritter decision was

equally misplaced and frivolous. There, the Tenth Circuit

deemed it appropriate to disqualify the district judge because,

inter alia, he was caustic and overbearing toward counsel for

the government and expressed, on the record, his belief that

the recusal efforts were calculated to impugn his integrity and

that of the attorney for the government's adversary, one Mr.

Christensen. Christensen was President of the Utah State Bar

Association and had forestalled Bar efforts to recommend im-

peachment and disability proceedings against the district judge.

The Court of Appeals found the record full of references to

Judge Ritter’s extreme deference to, and protection of Christen-

sen, as well as to the district judge’s concern about the impact

of the court proceedings upon Christensen’s career and deal-

ings outside of the pending case.

29

III.

OTHER FACTORS, NOT EXPRESSLY RELIED UP-

ON BY THE SIXTH CIRCUIT, ESTABLISH THAT

GARRATT’S MOTION TO DISQUALIFY JUDGE

tea WAS SANCTIONABLE UNDER RULE

11,

It is well established that a Respondent in this Court

may urge on appeal reasons for affirmance not relied upon

by the lower courts. California Bankers Ass’n v. Schultz,

416 U.S. 21, 71 (1974) ; United States v. American Ry. Ex-

press C'o., 265 U.S. 425, 485 & n.10 (1924); The William

Bagaley, 72 U.S. (5 Wall.) 377, 412 (1866). Most signifi-

cant in this regard was Garratt’s patent violation of the

necessity of bringing the Disqualification Motion in a

timely fashion. Timeliness had squarely been laid down

by Sixth Circuit as an absolute requisite to pursuing a

motion to recuse in Crowder v. Conlan, 740 F.2d 447, 453-

04 (6th Cir. 1984). Indeed, the necessity for seeking re-

cusal at the earliest possible moment is something ex-

pressly mandated by the terms of 28 U.S.C. 4144. The

observations of the First Cireuit made long ago are di-

rectly apposite. ‘‘The requirement of timeliness is of

fundamental importance. The first ground of the affidavit

is untimely as a matter of law. We do not see how anyone

could read the statute and think otherwise. Petitioner

knew of this circumstance for two and one-half years and

said nothing’’. In Re: United Shoe Machinery Corp., 276

F.2d 77, 79 (1st Cir. 1960) (emphasis supplied). Here,

Garratt claimed that Judge Gilmore was biased or preju-

diced against him and that that bias or prejudice had been

expressed in previous cases. Nevertheless, Garratt did not

elect to bring such matters up until after his pleadings

26

were struck. In fact, he did not move for recusal until the

very day the District Court was to have conducted the

Default Judgment hearing. Again, as the First Cireuit

noted, ‘‘one of the reasons for requiring promptness in

filing is that a party, knowing of a ground for requesting

disqualification, cannot be permitted to wait and decide

whether he likes subsequent treatment that he receives’’.

Id.

Finally, it should be noted that Garratt is misplaced

in his sweeping claim that absent this decision, there are

no federal cases dealing with the imposition of Rule 11

sanctions in the context of filing a motion for disqualifi-

eation. In Ricci v. Key Bancshares of Maine Inc., 111

F.R.D. 369, 377-378 (D.Me. 1986) Cireuit Judge Aldridge

sitting by designation imposed sanctions for filing a sim-

ilarly frivolous motion for recusal. As here, the motion

for recusal was not filed until well after a pattern of

dilatory tactics and delays had been established on the

record. Judge Aldridge found the motion untimely and

sanctionable. ‘‘In sum, the motion was both too late and

too little’’. Jd. Like Garratt, counsel made the argument

in Ricci that the unprofessional conduct was justified and

not sanctionable by claims of ‘‘advocacy and zeal’’ by the

attorney on behalf of his client. This contention was

squarely rejected by Judge Aldridge’s observation that the

legal research undertaken by the attorney ‘‘should surely

have revealed, if common sense had not, the impropriety

of using recusal as a second string to their bow... As

to delay, it is only too apparent that this was the purpose

[of the motion]’’. 7d. Building on Shakespeare (Hamlet,

IV, iii, 9) Judge Aldridge observed that ‘‘in court desper-

27

ate diseases are not to be relieved by desperate appliances.

Sanctions are clearly in order.’’ Jd. at 377-78.

°

CONCLUSION AND RELIEF REQUESTED

As this Response should demonstrate, two (2) Dis-

trict Judges and a panel of the Court of Appeals agreed

that the Petitioner had to be sanctioned under Fed.R.Civ.

P. 11 for filing a clearly frivolous Motion to Disqualify

Judge Gilmore. Garratt’s filing of the petition for cer-

tiorari may itself constitute a violation of Rule 11 as he

continues to pursue, even in this Court, his frivolous argu-

ments. Moreover, he has further demonstrated bad faith

by presenting what are unquestionably frivolous constitu-

tional arguments to which Respondent has been required

to respond.

WHEREFORE, Respondent, INVST FINANCIAL

GROUP, INC., prays that the Court deny the petition for

certiorari and enter an order awarding Respondent costs

and attorney fees.

Respectfully submitted,

BusHNELL, Gace, Reizen & Patton

By: Joun K. Parker (P29563)

Attorneys for Respondent

DATED: October 8, 1987

a-l

APPENDIX a

Rule 11. Signing of Pleadings, Motions, and

Other Papers; Sanctions

Every pleading, motion, and other paper of a party

represented by an attorney shall be signed by at least

one attorney of record in the attorney’s individual name,

whose address shall be stated. A party who is not rep-

resented by an attorney shall sign the party’s pleading,

motion, or other paper and state the party’s address. Ex-

cept when otherwise specifically provided by rule or stat-

ute, pleadings need not be verified or accompanied by af-

fidavit. The rule in equity that the averments of an answer

under oath must be overcome by the testimony of two

witnesses or of one witness sustained by corroborating

circumstances is abolished. The signature of an attorney

or party constitutes a certificate by the signer that the

signer has read the pleading, motion, or other paper; that

to the best of the signer’s knowledge, information, and

belief formed after reasonable inquiry it is well grounded

in fact and is warranted by existing law or a good faith

argument for the extension, modification, or reversal of

existing law, and that it is not interposed for any im-

proper purpose, such as to harass or to cause unnecessary

delay or needless increase in the cost of litigation. If a

pleading, motion, or other paper is not signed, it shall be

stricken unless it is signed promptly after the omission is

called to the attention of the pleader or movant. If a plead-

ing, motion, or other paper is signed in violation of this

rule, the court, upon motion or upon its own initiative,

shall impose upon the person who signed it, a represented

party, or both, an appropriate sanction, which may in-

a-2 |

clude an order to pay to the other party or parties the

amount of the reasonable expenses incurred because of

the filing of the pleading, motion, or other paper, including

a reasonable attorney’s fee.

(As amended Apr. 28, 1983, eff. Aug. 1, 1983; Mar. 2,

1987, eff. Aug. 1, 1987.)

b-1

APPENDIX b

UNITED STATES DISTRICT COURT

EASTERN DISTRICT OF MICHIGAN

SOUTHERN DIVISION

INVST FINANCIAL GROUP, INC.,

a Michigan corporation,

Plaintiff,

v. Civil No. 880V2217DT

CHEM-NUCLEAR SYSTEMS, INC.,

a foreign corporation,

Defendant.

ORDER

This matter is before the court on defendant’s motion

to disqualify the presiding judge in this action, pursuant

to 28 U.S.C. § 144 (1949). Initially, we note that, under

§ 144 (actions of a judge in pending or previous litigation

in which the movant has been involved are not grounds

for disqualification. Person bias based upon extrajudicial

actions must be shown. Southerland v. Irons, 628 F.2d

978 (6th Cir. 1980).

It is clear to this court that defendant is claiming no

personal bias on the part of Judge Horace Gilmore. De-

fendant’s allegations of bias all concern judicial actions

taken by the presiding judge in the present and past cases

in which defendant’s counsel has appeared. This is an

insufficient basis for disqualification.

b-2

Additionally, we have reviewed the procedural his-

tory of this lawsuit. We are of the opinion that, in bring-

ing this motion, defendant is compounding a demonstration

of lack of good faith in the defense of this action. While

we believe that this motion presents an appropriate basis

for the imposition of sanctions under Fed. R. Civ. P. 11,

such action is more appropriately left to the assigned

judge.

NOW, THEREFORE, IT IS ORDERED that defen-

dant’s motion to disqualify presiding district judge pur-

suant to 28 U.S.C. § 455 [sic] be and the same hereby is

DENIED.

/s/ Robert E. DeMascio

United States District Judge

Dated: Feb, 21, 1985

2 > oe

e-1

APPENDIX c

No. 85-1732

UNITED STATES COURT OF APPEALS

FOR THE SIXTH CIRCUIT

IN RE:

©. WILLIAM GARRATT, AND

GARRATT & MORRIS, P.C.

Petitioners-Appeilant

INVST FINANCIAL GROUP,

INC., A MICHIGAN

CORPORATION,

ORDER

(Filed Dee. 9, 1985)

Plaintiff-Appellee

v.

CHEM-NUCLEAR SYSTEM,

INC., A FOREIGN

CORPORATION,

me ue ea a a ae a ee ee

Defendant

BEFORE: KEITH, KENNEDY, and KRUPANSKY,

Circuit Judges

This matter is before the Court upon plaintiff’s mo-

tion to dismiss the appeal of William C, Garratt.

On September 18, 1985, Garratt filed a notice of ap-

peal from the orders of January 17, 1985 in which Judge

Gilmore denied Garratt’s oral motion to disqualify him-

self and on February 21, 1985 Judge DeMascio denied

e-2

Garratt’s written motion to disqualify Judge Gilmore,

stating also that sanctions should be imposed on Garratt

pursuant to Federal Rule Civil Procedure 11. On April

24, 1985, the district court ruled that sanctions would be

imposed on Garratt and referred the matter to a United

States Magistrate pursuant to Federal Rule of Civil Pro-

cedure 53. On August 6, 1985, the Magistrate reecommend-

ed that sanctions be imposed against Garratt in the amount

of Fourteen Thousand Two Hundred Thirty Eight Dol-

lars and Seventy Five Cents ($14,238.75), however this

recommendation was not adopted by the district court un-

til October 8, 1985 thereby rendering Garratt’s notice of

appeal filed on September 18, 1985 premature since there

was no final order regarding the issue to which Garratt

had standing. Garratt further failed to perfect his appeal

once the district court entered its final order regarding

the imposition of sanctions.

It is ORDERED that the motion to dismiss be and

hereby granted.

ENTERED BY ORDER

OF THE COURT

/s/ John P. Hehman

Clerk