Opposition Brief — Adams-Hedrick v. Liberty Mutual Mutual Insurance Insurance Co Co (No. 06-913)

No. 06-913

IN THE

Supreme Court of the United States

DONNA ADAMS-HEDRICK, et vir.,

Petitioners,

Vv.

LIBERTY MUTUAL INSURANCE COMPANY,

Respondent.

On PETITION FOR A WRIT OF CERTIORARI TO THE

UNITED States Court OF APPEALS

FOR THE FirtH CIRCUIT

BRIEF IN OPPOSITION

Mary M. MARKANTONIS

Dean G. Pappas & Assoc., P.C.

10375 Richmond, Suite 1670

Houston, Texas 77042

(713) 914-6200

Attorneys for Respondent

207135 g

COUNSEL PRESS

(800) 274-3321 + (800) 359-6859

i

COUNTERSTATEMENT OF THE

QUESTIONS PRESENTED

Petitioners appealed the District Court’s Order of

Remand and Order granting attorney’s fees to Liberty Mutual

and sanctioning Petitioners. They further appeal the Fifth

Circuit’s dismissal for lack of jurisdiction based on 28 U.S.C.

§ 1447(d), Louisville & Nashville R. Co. v. Mottley, 211 U.S.

149, 150-153 (1908) and Sitton v. United States, 413 F.2d

1386, 1389 (5" Cir. 1969), affirming of the non-monetary

and monetary sanctions and award of statutory attorney’s fees

against Petitioners, and granting of costs and damages to

Liberty Mutual pursuant to Fed. R. App. Proc. 38 and 28

U.S.C. § 1912. Petitioners attempt to interject non-existent

constitutional issues of a right to be represented in court by

a non-attorney having no basis in Liberty Mutual’s original

petition for judicial review of a final workers’ compensation

administrative decision filed in the Texas state court. The

only questions for review are:

1. Whether an Order of a District Court remanding on the

basis of 28 U.S.C. § 1447(c) is reviewable by the Court of

Appeals.

2. Whether the District Court abused its discretion in

awarding statutory attorney’s fees and sanctions against the

Petitioners.

3. Whether the Court of Appeals abused its discretion in

awarding costs and damages against the Petitioners.

li

STATEMENT PURSUANT TO RULE 29.6

Respondent, Liberty Mutual Insurance Company, has no

parent corporation and no publicly held company owns 10%

or more of its stock.

ili

TABLE OF CONTENTS

COUNTERSTATEMENT OF THE

QUESTIONS PRESENTED ...........000--

STATEMENT PURSUANT TO RULE 29.6 ......

TABLE GP CONTEINIG cccccccvcecsececeedes

TABLE OF CITED AUTHORITIES ............

FIRE onc Vir cbse ence cnvevetreares

SUMMARY OF REASONS TO DENY PETITION

STATEMENT OF THE CASE ....ccsccoscecves

Fic FR OE GD OD on to 0 ck Hee enskseess

BD. FOOCORRINES DOIOW occ ccccesrvesenvteas

1. Ms. Adams’ work related injuries and

workers’ compensation claims .......

2. Federal court litigation history .......

re re rye re

REASONS FOR DENYING THE PETITION ....

I. Appellate review of remand orders is barred

Oy Ze AGA. | SOCIO « o ccstvcsevceasss

Page

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iy

Contents

Page

A. Alternatively, without waiving the

foregoing, Petitioners did not follow the

proper procedure to remove this case. .. ll

1. Petitioners’ Notice of Removal was

I UE bb cb rds siudsnetss il

2. Respondent’s Motion for Remand

Wan Cmiely Tied... ccccccicess 14

3. Petitioners’ Notice of Removal based

upon their own cause of action ... 14

4. Petitioners attempted to remove

abated state court case .......... 15

ae ee errr errs 15

II. There was no abuse of discretion in awarding

or affirming the award of statutory attorney’s

fees to Liberty Mutual the prevailing party in

a removal action and sanctioning the

Petitioners because such an award is

authorized by 28 U.S.C. § 1447(c) when there

is no objectively reasonable basis for seeking

removal and Petitioners violated Rule 11 of

the Federal Rules of Civil Procedure. ..... 17

a gC en re rere 17

ee Sc eG sa Wiener as Baa eeees 19

1. Non-monetary sanctions ........ 21

2. Monetary sanctions ............. 24

Cited Authorities

Page

Il. The Court of Appeals for the Fifth Circuit did

not abuse its discretion in awarding Liberty

Mutual costs and damages for attorney’s fees

because the Petitioners lacked an objectively

reasonable basis for seeking removal and their

appeal was frivolous and caused unnecessary

delay and expense. Fed. R. App. Proc. 38. ... 15

A. Lack of objectively reasonable basis .. 25

B. Petitioners’ appeal was frivolous. .... 25

Sa IUUNOEE | 9-409 AN e acid hind sec emeEeewen 26

vi

TABLE OF CITED AUTHORITIES

Cases:

Ankrom vy. Dallas Cowboys Football Club, Ltd., 900

S.W.2d 75 (Tex. App.-Dallas 1995, writ

EE eer 566 doe oe bose eee ieee

Baron v. Strassner, 7 F. Supp. 871 (S.D. Houston

DEE 1 aeuntectene trdivderdaehes caneneenen

Blackmore v. Rock-Tenn Co., 756 F. Supp. 288

RG Mee BOWED a diced chen vowesuneeeeeens

Brown v. Demco, Inc., 792 F.2d 478 (5" Cir. 1986)

ee)

Business Guides, Inc. v. Chromatic Communications

Enterprises, Inc., 498 U.S. 533 (1991) ........

Caterpillar, Inc. v. Williams, 482 U.S. 386, 107

S. Ct. 2425, 96 L. Ed. 2d 318 (1987) ..........

Certain Underwriters at Lloyd’s v. Bristol-Myers

Squibb Co., 51 F. Supp. 2d 756 (E.D. Tex. 1999)

“eee eeeeeeeeeeeeeeeeeeereeeeeeere eee ee eee

Cervantes v. Tyson Foods, Inc., 130 S.W.3d 152

(Tex. Civ. App.—El Paso 2003) ..............

Chambers v. NASCO, Inc., 501 U.S. 32 (1991)

Cooter & Gell v. Hartmarx Corp., 496 U.S. 384

SET i etendwess weed dbdcwar san ecenwees 19-20, 21

Page

15-16

13

23

16

15

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Cited Authorities

Page

Denton v. Hernandez, 504 U.S. 25, 112 S. Ct. 1728

SUNN iva hese sued ekeced nal measkseewes 25

ESIS, Inc., Servicing Contractor v. Johnson,

908 S.W.2d 554 (Tex. Civ. App.—Fort Worth

3 PCT ee Ce ae ee pe 17

Exxon Mobil Corp. v. Saudi Basic Indus. Corp., 544

U.S. 280, 125 S. Ct. 1517, 161 L. Ed. 2d 454

GO oss dua hash canbe vsacnlesieteviee 16

Galloway v. Louisiana, 817 F.2d 1154 (Sth Cir.

SEED cashew kde cabal eei eke ee 21

Gravitt v. Southwestern Bell Telephone Co., 430 U.S.

FER GHETED ch duacswiiindaniadssovaweds eis 10

Gully y. National Bank, 29 U.S. 109, 57 S. Ct. 96,

ee fh | SR er rrr eT ere 16

Johnson v. Georgia Highway Fxpress, Inc., 488 F.2d

FORE Ge OPO 2 ka vacbatucadkkdkevaceses 18, 19

Kircher v. Putnam Funds Trust, 546 U.S. __, 126

Pe es ee Ce kb cho ens tae caneeen een: 10, 11

In re Louisiana-Pacific Corp., 112 S.W.3d at 188 ... 4

Louisville & Nashville R. Co. v. Mottley, 211 U.S. 149

SOE bb hk seins be ee lane eadeneneacedadena 10

Lumbermens Mut. Cas. Co. v. Garza, 777 8.W.2d 198

(Tex. Civ. App.—Corpus Christi 1989) ........ 15

vill

Cited Authorities

Page

Martin v. Franklin Capital Corporation, 546 U.S.

Does Ea ae Ge Pe CED vb endo beaenreane 18

Mason City & Fort Dodge Railroad Co. v. Boynton,

a4 U.S. 570, 27 S. Ct. S21 CISGT) og coe ce cwes 15

Neitzke v. Williams, 490 U.S. 319, 109 S. Ct. 1827

CROOE viv bangs ueinv anak bec wen ehh eee 24, 25

Scott v. Communications Services, Inc., 762 F. Supp.

147 (S.D. Tex. 1991), aff’d, 961 F.2d 1571

Cae Rees: SOW ov Senos ene erences 15

Simpson v. State, 998 S.W.2d 304 (Tex. Civ. App.—

AED TTRSR 0 hese sha wee ee ee 17

Thermtron Products, Inc. v. Hermandsdorfer, 423 U.S.

FORE TED 6a ebndscak dances t cena. 10

Things Remembered, Inc. v. Petrarca, 516 U.S. 124

CRUD 5 006 0 0a S eens Chae eee 10

Thomas v. Capital Security Services, Inc. 836 F.2d

SOeta” Ga. TO biases dsteccadeueneees 23

Willy v. Coastal Corp., 855 F.2d 1160 (5 Cir. 1988)

pave eaVerkstekneae ak eR eee 13

Willy v. Coastal Corp., 503 U.S. 131 (1992) ...... 12, 21

1x

Cited Authorities

Page

Statutes:

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ere 7, 24

EE Cebeheseeereescovsessvedveeees 7, 24

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ED Svcerivecevevecvevcceeevcess l

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SPP RROD os ccc cccccvccscceveveveseus 11, 14

CMG Ce AMFEDD wccccceccescceserevees 11,12, 13

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EE EIU). ccc cdcccctvevescceces 1, 10, 25, 26

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Cited Authorities

Page

Te See OS CPEE ndendidtnrentencesadeinietes 7

Ce aE SUED sek echiseciestersavadieen 7

See; GIS Ge - SEe h cs O40 wal nowdeeoeeen “9

28 Tex. Admin. Code § 150.3(a)(3) ............. 4,9

10%. Led, Code 9 SGI SIS?) an ccccccccuvescess 9

POR, BE CGE GSE cece vcdsntedetsissves 3

OM, La. CORS B GES 0.0 6.00 vanknseecesocess 3

Fens LAD. COR SEITE wisccbvecwecdcesee 9

SOR, ADs CRO BGT ak vcd cw ee decseseees 17, 25

Tex. Lab. Code Ann. § 410.104 ..........-c000- 4

Tex. Lab. Code Ann. §§ 410.151-410.169 ........ 4

Tex. Lab. Code Ann. § 410.169 ................ 17

Tex. Lab. Code Ann. §§ 410.201-410.208 ........ 4

Tex. Lab. Code Ann. §§ 410.251- 410.308 ....... 4

Tex. Lab. Code Ann. §§ 410.024, 410.169, 410.205 4

7OR. LAD. Cogs & GIGZIOMED cccevcccrcvceess 4

XI

Cited Authorities

Page

Rules:

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JURISDICTION

The United States Court of Appeals for the Fifth Circuit

issued its Order dismissing Adams’ and Hedrick’s pro se

appeal to that court on September 15, 2006. On November

16, 2006, Adams and Hedrick, pro se, initially filed their

Petition for Writ of Certiorari and it was docketed on or about

January 6, 2007. Respondent respectfully submits that this

Court lacks and the Fifth Circuit Court of Appeals lacked

jurisdiction to review the District Court’s Order of Remand

granted on the basis of a timely raised defect in removal

or lack of subject matter jurisdiction, pursuant to 28 U.S.C.

§§ 1446 & 1447, and should dismiss the petition as to those

questions. Respondent further submits that this Court does

have jurisdiction to review the District Court’s order granting

Liberty Mutual’s statutory attorney’s fees and sanctioning

Petitioners and the orders of the Court of Appeal for the Fifth

Circuit affirming the District Court’s order on attorney’s fees

and sanctions and granting the Respondent’s motion for costs

and damages, all pursuant to 28 U.S.C. § 1254(1).

SUMMARY OF REASONS TO DENY PETITION

I. Pursuant to 28 U.S.C. § 1447(d), the United Sates

Court of Appeals for the Fifth Circuit did not have jurisdiction

to review a dismissal of an appeal of an Order of Remand

based upon defects in the removal procedure or lack of

jurisdiction, even if erroneously granted.

A. Alternatively, without waiving the foregoing,

Petitioners did not follow the proper procedure to remove

this case from state court to District Court.

B. Alternatively, without waiving the foregoing, the

District Court had no jurisdiction of this case.

2

II. The District Court did not abuse its discretion in

awarding statutory attomey’s fees to Liberty Mutual and granting

monetary and non-monetary sanctions against Petitioners, and

the Court of Appeals for the Fifth Circuit did not abuse its

discretion in affirming same, because Petitioners lacked an

objectively reasonable basis for seeking removal, Petitioners’

conduct during the course of this case up to July 25, 2005,

violated Rule 11 of the Federal Rules of Civil Procedure and

Liberty Mutual was the prevailing party in the case.

Ill. The Court of Appeals for the Fifth Circuit did not abuse

its discretion in awarding Liberty Mutual costs and damages

because Petitioners lacked an objectively reasonable basis for

seeking removal, their appeal is frivolous and has caused

unnecessary delay and expense. Fed. R. App. Proc. 38.

STATEMENT OF THE CASE

A. Nature of the case

This is an appeal of the dismissal of an appeal of an order

of remand in a state workers’ compensation case. Respondent

submits that the only issue for review is wheiher a remand order

of a workers’ compensation case, defectively removed from state

court and over which the federal district court had no jurisdiction,

is reviewable. Alternatively, and without waiving the foregoing,

at issue is whether Petitioners properly removed this case from

state court and whether the District Court had jurisdiction to

hear this case.

Additionally, issues raised, but not briefed by Petitioners,

are whether the Court of Appeals for the Fifth Circuit abused

its discretion in granting Liberty Mutual its costs and damages

and whether the District Court abused its discretion in granting

Liberty Mutual statutory attorney’s fees and in sanctioning the

Petitioners.

B. Proceedings below

This case originated as a suit filed in state district court by

Respondent Liberty Mutual for judicial review of an

administrative decision of the Texas Workers’ Compensation

Commission Appeals Panel by which it was aggrieved with

respect to the workers’ compensation claim of Donna Adams.

Adams answered and counterclaimed for bad faith and Hedrick

intervened. The bad faith claim was severed and abated.

1. Ms. Adams’ work related injuries and workers’

compensation claims

Ms. Adams was employed by IBM as a technical support

representative responsible for going to work sites and setting

up computer systems. Ms. Adams filed two workers’

compensation claims with the Texas Workers’ Compensation

Commission’ (TWCC), the Texas agency charged with the

responsibility of administering workers’ compensation claims

at the time, Tex. Lab. Code § 402.061, (R. 322): one for March

29, 2000 claiming to have suffered an asthma attack after

inhaling dust at the jobsite that was still under construction and

one for August 17, 2000, claiming another asthma attack as a

result of the heat, which resulted in her hospitalization.’

1. By recent amendment effective September 1, 2005, the Texas

Workers’ Compensation Commission was abolished and supplanted by

the Division of Workers’ Compensation within the Texas Department

of Insurance. Tex. Lab Code § 402.001. For purposes of this brief, this

agency will be referred to as the TWCC.

2. During the pendency of these claims, Ms. Adams and Mr.

Hedrick filed suit against the TWCC, hearing officer Kathleen Decker,

Liberty Mutual, its counsel] Tommy Smith, IBM, its chief executive

officer at the time, Louis Gerstner and its employee Michael Clark

(Cause No. H-01-3416). (R. 356) The case was dismissed for lack of

jurisdiction by Judge Hoyt. (R.468-472) Ms. Adams and Mr. Hedrick

(Cont'd)

4

Ms. Adams’ workers’ compensation claims proceeded

and were heard in one contested case hearing. (Pet. App. G)

Ms. Adams appeared at the contested case hearing and was

represented by her husband, Mr. Hedrick.* (Pet. App. G)

(R. 322) The hearing officer’s findings and decision were

affirmed by the Appeals Panel.* On August 21, 2003, Liberty

Mutual filed a suit for judicial review of a portion of the

hearing officer’s decision to state court under Cause No.

25628 in Brazoria County, Texas, the county of residence of

Ms. Adams pursuant to the Texas Labor Code. Tex. Lab. Code

§ 410.252(b)(1). (R.334-348) Ms. Adams did not appeal the

TWCC finding that she did not sustain a compensable injury

on August 17, 2000 and this finding became final. Tex. Lab.

Code § 410.205. On September 26, 2003, she answered the

lawsuit and filed a counterclaim for bad faith. (R.706)

(Cont'd)

appealed to the Court of Appeals for the Fifth Circuit under Case No.

0Q2-20111 and the order of dismissal was affirmed because Ms. Adams

failed to exhaust her administrative remedies.

3. Texas allows a non-attorney to represent a claimant before

the TWCC. 28 Tex. Admin. Code § 150.3(a)(3).

4. “Judicial review is the concluding step of the Act’s four-tier

system for disposition of compensation issues. /n re Louisiana-

Pacific Corp., 112 S.W.3d at 188; see Tex. Lab. Code Ann.

§§ 410.021-410.034 (benefit review conference); Tex. Lab. Code

Ann. §§ 410.104; 410.151-410.169 (arbitration or contested case

hearing); Tex. Lab. Code Ann. §§ 410.201-410.208 (appeals panel

review); Tex. Lab. Code Ann. §§ 410.251- 410.308 (judicial review).

Each step is a prerequisite to the succeeding one. See Tex. Lab. Code

Ann. §§ 410.024, 410.169, 410.205; see also Ankrom v. Dallas

Cowboys Football Club, Ltd., 900 S.W.2d 75, 78 (Tex. App.-Dallas

1995, writ denied) (Act provisions regarding successive steps in the

progress and maturity of a claim are mandatory.).” Cervantes v. Tyson

Foods, Inc., 130 S.W.3d 152 (Tex. Civ. App.—E]I Paso 2003).

5

Ms. Adams also filed motions to allow her husband Mr.

Hedrick to represent her. (R.566-575) Mr. Hedrick intervened

in the lawsuit and made himself a party. (R.576-581) Liberty

Mutual filed a motion to sever the bad faith claim and

specially excepted to the pleadings seeking recognition of

Mr. Hedrick as Ms. Adams’ attorney for purposes of the

litigation.

Liberty Mutual’s motion for severance was set for

hearing with proper notice to Petitioners. Ms. Adams and

Mr. Hedrick failed to appear at the hearing on January 26,

2004. At the conclusion of the hearing held in open court,

the motion for severance was granted and Petitioners’ bad

faith claims were severed from the main case into Cause No.

25628-1. (Pet. App. F) (R.350-353) Liberty Mutual’s special

exceptions have not yet been heard because they are part of

the severed and abated case. (R.154)

2. Federal court litigation history

The removal actions filed by Ms. Adams and Mr. Hedrick

in this case are:

ee

Federal

Docket No.

H-04-0954

H-05-0987

H-05-1974

Date

Filed

3/10/04

3/23/05

6/6/05

State Cause

Remanded

No. 25628

No. 25628

No. 25628-1

Date of

Remand

10/22/04

5/6/05

7/25/05

Judge

Presiding

Hon. Lee Rosenthal

Hon. Lynn Hughes

Hon. Kenneth Hoyt

7

Both prior removals were of the main case (Cause No.

25628), the appeal of the final decision of the Texas Workers’

Compensation Commission Decision and Order. In the first

removal action, no motion for statutory fees was filed, in the

second action one was filed and denied.’

3. This lawsuit

This case involves removal of the abated and severed

bad faith counterclaims of Petitioners who alleged that “This

case became removable on May 24, 2005 upon the United

States District Courts [sic] issuing its last order; Order

Denying Liberty Mutual Insurance Company’s Motion for

Sanctions and Attorney Fees in removed case No. H-05-987.”

(R. 607) Further into the Notice of Removal, they alleged

that they were removing

... all ‘bad faith actions’ and violation of U.S.C.

Title 18 (aka The United States Criminal Code)

against LIBERTY MUTUAL INSURANCE

COMPANY and their ‘insured employer’

International Business Machines contained in the

239" Judicial Court of Brazoria County, Case No.

25628-1 alleging civil and criminal wrongs

not compensable under the Texas Workers’

Compensation Act.

(R. 622-623) Petitioners attempted to assert numerous federal

questions involving 18 U.S.C. §§ 24, 241, 242, 371, 1035,

1347, 1512, and 42 U.S.C. §§ 1981, 1983 and 1985, that

have nothing to do with Liberty Mutual’s suit for judicial

review of a workers’ compensation administrative ruling.

5. The motion was filed to put the pro se Petitioners on notice

that Liberty Mutual could request such relief from, and as a deterrent

to, their frivolous and repetitive removals.

8

As the bad faith claims were severed on January 26,

2004, Liberty Mutual filed its Motion to Remand based on

defects in the statutory removal procedure: the May 24, 2005

Order denying attorney’s fees did not create federal

jurisdiction, Petitioners did not file their notice of removal

within 30 days of the Order of Severance, but instead more

than one year after the Order of Severance and the District

Court lacked jurisdiction over a state workers’ compensation

case. (R 526-531)

Liberty Mutual’s Motion to Remand was set for hearing

with proper notice to Ms. Adams and Mr. Hedrick, but neither

appeared at the hearing on July 25, 2005. (Pet. App. D)

(R. 875) During the hearing, Judge Hoyt attempted to reach

the Petitioners by phone. (Pet. App. D) (R. 1006) At the

conclusion of the short hearing, Judge Hoyt granted the

Liberty Mutual’s Motion to Remand and Motion for

Sanctions and Motion for Statutory Attorney’s Fees and

denied all the motions filed by Petitioners. (Pet. App. B)

(R. 1009, 962-966 & 968) Petitioners appealed all orders to

the Fifth Circuit.© The basis of their appeal was that (1) the

state district court violated Ms. Adams constitutionally

guaranteed right to be properly represented in court,

(2) the District court violated Mr. Hedrick’s constitutional

right to represent his wife in court, (3) the District

and state district courts violated Ms. Adams’ right to access

to court by failing to allow her spouse Mr. Hedrick

6. Order of Remand of July 25, 2005, the Order Granting

Liberty Mutual’s Motion for Sanctions and Motion for Statutory

Attorney’s Fees and the Order denying the numerous motions to

compel joinder of Attorney General of United States, the United

States Department of Justice, International Business Machines (IBM),

Louis V. Gerstner (then acting CEO of IBM), Richard Rodgers, Ellen

O’Brien, Bradley Koeh!, Dr. Ponterio and Michacl Clark, and Motion

to Appoint Guardian, Motion to Disqualify Opposing Counsel,

Motion to Strike All Documents Filed by Opposing Counsel, Motion

to Stay and Motion for Continuance. (R. 977-978)

9

to represent her in court, (4) the District court denied Ms.

Adams’ right to access to court by failing to advise her prior

to any hearings that access via telephone was approved,

(5) the District court erred in ordering attorney fees and

sanctions against Petitioners, and (6) the District court erred

in remanding the case on the basis of lack of subject matter

jurisdiction. Liberty Mutual filed a Motion to Dismiss the

appeal as well as an Appellee’s Brief. The Fifth Circuit

granted Liberty Mutual’s Motion to Dismiss and Motion for

Costs and Damages, and denied all Petitioner’s motions.’

On November 16, 2006, Petitioners filed their Petition

for Writ of Certiorari with the Supreme Court. The

inaccuracies contained in the rendition of the facts made by

Petitioners and the petition’s focus on a non-existent right

of Hedrick, a layman, to represent Adams in a court of law

required Liberty Mutual to file this Brief in Opposition.

Petitioners filed their Petition for Writ of Certiorari asserting

federal questions involving (1) whether the disabled Ms.

Adams’ right to due process was violated by failing to

recognize the status of her spouse Mr. Hedrick to represent

her in court, (2) whether the provisions of Tex. Lab. Code

§§ 401.011(37) & 402.071 and 28 Tex. Admin. Code §

150.3(a)(3), allowing a claimant non-attorney representation

at TWCC hearings, and the provision of the Tex. Gov’t Code

§ 81.102(a), prohibiting non-attorney representation in state

and federal courts violate the due process rights of Ms. Adams

to be represented by her non-attorney spouse who represented

her at the administrative hearing and who was most

knowledgeable of the facts of the case, (3) whether the

District Court and Court of Appeals for the Fifth Circuit

abused their discretion in ordering sanctions and costs against

7. Petitioners’ motion for $20,000 in sanctions, motion to turn

the appeal over to the FBI for investigation of allegations of

conspiracy between employees of the Court of Appeals and motion

to continue all actions pending the outcome of that investigation.

10

Petitioners to “silence” attempts to challenge state laws and

non-attorney representation, (4) whether the Court of Appeals

for the Fifth Circuit erred in dismissing the appeal without

addressing the disabled Ms. Adams’ rights to due process,

representation and protection of fair and equal access to the

court, and (5) whether the District Court and the Court of

Appeals for the Fifth Circuit unfairly issued sanctions and

costs against Petitioners.

REASONS FOR DENYING THE PETITION

I. Appellate review of remand orders is barred by

28 US.C. § 1447(d).

Liberty Mutual’s Motion to Remand, based on defects

in the removal procedure and lack of jurisdiction, was heard

and granted. Therefore, even if erroneous, this Court does

not have jurisdiction to consider a review, by any method, of

the Order of Remand. 28, U.S.C. § 1447(d); Things

Remembered, Inc. v. Petrarca, 516 U.S. 124, 127-128 (1995);

Gravitt v. Southwestern Bell Telephone Co., 430 U.S. 723

(1977); Louisville & Nashville R. Co. v. Mottley, 211 U.S.

149, 150-153 (1908) (plaintiff, not defendant, controls

removability of case); Kircher v. Putnam Funds Trust, 546

U.S. __, 126 S. Ct. 2145, 2154 (2006).

Petitioners “appeal to the United States Court of Appeals

for the 5" Circuit from the following orders of the United

States District Court ... Order of Remand entered in this

action on the 25" day of July, 2005.” (R 977)

Courts of appeal lack jurisdiction to hear a direct appeal

of an order of remand based on a defect in the removal

procedure. 28 U.S.C.A. § 1447 (d); Thermtron Products, Inc.

v. Hermandsdorfer, 423 U.S. 336, 346 (1976). Therefore,

this appeal should be dismissed.

11

Even if erroneous, this Court does not have jurisdiction

to consider a review, by any method, of the Order of Remand.

“[R]Jeview is unavailable no matter how plain the legal error

in ordering the remand.’” Kircher v. Putnam Funds Trust,

547 U.S. ___, 126 S. Ct. 2145, 2154 (2006) (quoting Briscoe

v. Bell, 432 U.S. 404, 414 n.13 (1977)). (Where a remand

order is based on one of § 1447(c)’s grounds, review is

unavailable no matter how plain the legal error in ordering

the remand.)

A. Alternatively, without waiving the foregoing,

Petitioners did not follow the proper procedure

to remove this case.

1. Petitioners’ Notice of Removal was untimely

filed

In the alternative, without waiving the foregoing,

Petitioners filed their Notice of-Removal on June 6, 2005.

(R. 8) Petitioners’ Notice of Removal was untimely because

they failed to file their Notice within thirty days of receipt of

either the initial pleading or an amended pleading, motion,

order or other paper from which the Petitioners may have

first ascertained that this case was or had become removable

as required by 28 U.S.C. § 1446(b). (R. 265-266).

Petitioners recited in their Notice of Appeal that this case

became removable on May 24, 2005, the date Liberty

Mutual’s Motion for Sanctions and Attorney’s Fees was

denied by Judge Hughes in the second removal action of the

main case, but failed to include a brief statement

explaining the basis of how this order created federal

jurisdiction.* 28 U.S.C. § 1446(a). (R. 10) Nothing in the

8. Petitioners did not attach a copy of the May 24, 2005 Order

to their Notice of Removal, nor include it in their appendix. It appears

in Respondent’s Appendix as No. 3.

12

May 24" Order in the prior removal action of the main case,

gave rise to a federal question for federal court jurisdiction.

See Willy v. Coastal Corp., 503 U.S. 131, 138 (1992). The May

24" Order was the only “pleading, motion, order or other paper”

at the time of the June 6 Notice of Removal that was less than

thirty days old and that Petitioners could allege to appear timely.

28 U.S.C. § 1446(b). Their statement that the case became

removable on May 24, 2005, because of the May 24, 2005 Order

Denying Motion for Sanctions and Attorney’s Fees was a

frivolous pleading to avoid the Section 1446(b)’s thirty day time

limit. Such order has no bearing on whether the District Court

had jurisdiction of the controversy removed in this case and in

no way relates to any of the numerous statutes Petitioners allege

present a federal question. (R. 10-21)

As another basis for removal to federal court, Petitioners

included the January 26, 2004 state court Order of Severance

and removed the “severed allegations of civil wrongs.”

(Pet. App. F) (R 623). The January 26, 2004 state court Order

of Severance and the Memorandum and Order of Judge

Rosenthal in the first removal action were attached to Petitioners’

Notice of Removal in the second removal action filed on March

23, 2005. (Pet. App. F,) (R.557-565) Clearly, Petitioners had

notice of both orders on March 23, 2005. Therefore, from the

record, March 23, 2005 is the latest date from which Petitioners

could have received notice of and ascertained from those orders

“that the case is one which is or has become removable”. 28

U.S.C. § 1446(b). Assuming they could base removal on their

own pleadings, to be timely, Petitioners must have filed their

Notice of Removal by April 23, 2005. Their Notice of Removal

was filed on June 6, 2005, more than thirty days after

March 23.'°

9. Petitioners used the January 26, 2004 as a ground for removal

in their 2 removal action.

10. In reality, Appellants had notice of these Orders much earlier,

but verification of their reccipt of them before March 23, 2005, is outside

the record.

13

Not having filed their Notice of Removal within 30 days

of the January 26, 2004 Order of Severance, or even 30 days

from notice of the order, the Petitioners waived their night to do

so. 28 U.S.C. § 1446(b); Brown v. Demco, Inc., 792 F.2d 478,

481 (5 Cir. 1986). It was incumbent upon the Petitioners to

show their removal was proper. Willy v. Coastal Corp., 855 F.2d

1160, 1164 (5 Cir. 1988). In their Response to the Liberty

Mutual’s Motion to Remand, Petitioners failed to assert, or make

any showing, that their removal was timely. (R. 881-897) No

facts, argument or authority were asserted by Petitioners in

response to Liberty Mutual’s ground of procedural defects in

the removal. (R. 881-897)

The Petitioner’s Notice of Removal is untimely for the

additional reason that the alleged facts made the basis of the

Petitioners’ third removal are represented by Petitioners as

having taken place prior to the filing of Liberty Mutual’s original

state court action. They attached to their Notice of Removal the

following exhibits dated prior to the filing of Liberty Mutual’s

original state court action in support of their factual allegations:

Exhibit A dated October 2, 2000 (Durable Power of

Attorney signed by Donna Adams appointing Robert

Hedrick her attorney in fact) (R.42);

Exhibit D dated October 10, 2000 —February 26, 2001

(Notes of E. O’Brien) (R. 60);

Exhibit E dated February 2, 2001 (letter from IBM to

OSHA), January 26, 2001 (letter from U.S. Dept. of Labor

to IBM), May 30, 2001 (Letter from IBM to Robert Hedrick)

(R.62);

Exhibit F purportedly dated March 27, 2003 (Purported

deposition of Michael Clark) (R.71);

Exhibit G dated February 3, 2001 (Affidavit of Edith

Knighten) (R.77);

14

Exhibit Q dated May 15, 2001 (Notice of Appraised Value)

(R.90); and

Exhibit Z dated May 30, 2001 (Letter from Tommy Smith

to Louis Gertner) (R.160).

Therefore, in September, 2003, when they filed their answer/

counterclaim in the state district court, Petitioners had already

“ascertained” the existence of most of the facts they alleged

gave rise to the claims asserted in their Notice of Removal.

2. Respondent’s Motion for Remand was timely

filed

Liberty Mutual timely filed its Motion to Remand on June

30, 2005 within thirty days of Petitioners’ Notice. (R. 257)

Liberty Mutual’s Motion to Remand was based in part on

procedural defects in the Appellants’ removal of the case which

included failure to timely remove, failure to state a ground upon

which removal could be based, having the status of a plaintiff

in the action sought to be removed, trying to remove an abated

lawsuit, and basing removal on their own pleadings and not

Liberty Mutual’s original petition. (R. 265-269)

3. Petitioners’ Notice of Removal based upon their

own cause of action

Another basis of Liberty Mutual’s Motion to Remand was

the defect of Petitioners’ Notice of Removal being based upon

their own causes of action and not Liberty Mutual’s original

petition. (R. 267) “In cases removed to federal court, the

plaintiff's well-pleaded complaint, not the removal petition,

must establish that the case arises under federal law.” Id. at

1165.

Liberty Mutual asserted that Petitioners were in fact the

“plaintiffs” in the action they sought to remove and did not

qualify as “a defendant” under 28 U.S.C.A. § 1446(a) to remove

their bad faith action. (R. 267) As the plaintiffs in their cause of

action, they had the choice to file their action either in state

court or District court when they filed their countersuit on

September 26, 2003.

In Certain Underwriters at Lloyd’s v. Bristol-Myers Squibb

Co., 51 F. Supp. 2d 756, 759 (E.D. Tex. 1999), the issue of

whether the removing party was a defendant was addressed.

The factors considered were whether the party’s claims

constitute the “‘mainspring of the proceedings” and whether the

“the institution and continuance of the proceedings depend upon

its will,” citing Mason City & Fort Dodge Railroad Co. v.

Boynton, 204 U.S. 570, 580, 27 S. Ct. 321 (1907). Though Ms.

Adams was the designated defendant in the workers

compensation case, she became a plaintiff when she sued Liberty

Mutual for bad faith. Since the right to removal is limited to

defendants, Ms. Adams, being a plaintiff in the severed

bad faith action, could not remove her case to District Court.

Scott v. Communications Services, Inc., 762 F. Supp. 147, 150

(S.D. Tex. 1991), aff’d, 961 F.2d 1571 (Sth Cir. 1992).

4. Petitioners attempted to remove abated state

court case

Liberty Mutual also asserted that by virtue of the Order of

Severance and Abatement, the Cause No. 25628-1 had been

abated until the main case had been finally determined. (R.268,

350-353) The case having been abated, the Petitioners were

prohibited from proceeding in any manner until the case had

been revived. Lumbermens Mut. Cas. Co. v. Garza, 777 S.W.2d

198, 199 (Tex. Civ. App.—Corpus Christi 1989).

B. Lack of jurisdiction

Liberty Mutual’s Original Petition was based upon a

workers’ compensation claim filed by Ms. Adams over which

federal courts have no jurisdiction. 28 U.S.C. § 1445(c);

Blackmore v. Rock-Tenn Co., 756 F. Supp. 288, 289 (N.D. Tex.

16

1991). Adams was attempting to refile the abated state court

bad faith counterclaim in District Court. Liberty. Mutual’s

Original Petition controls whether this action was removable

to federal court. Caterpillar, Inc. v. Williams, 482 U.S. 386,

392, 107 S. Ct. 2425, 2429, 96 L. Ed. 2d 318 (1987). Liberty

Mutual did not allege a federal question on the face of its Original

Petition to which federal jurisdiction could attach. Gully v.

National Bank, 29 U.S. 109, 111-113, 57 S. Ct. 96, 97, 81

L. Ed. 70 (1936). The federal question issues alleged by Adams

(complaint with the trial court’s Order Granting Severance and

Abatement of January 26, 2004, her spouse’s right to act as an

attorney for her in a court of law and her request to have him

appointed guardian and/or guardian ad litem over and/or for his

wife) do not grow out of the same fact situation or controversy

made the basis of the original suit and do not confer subject

matter jurisdiction to this federal court. /d., Baron v. Strassner,

7 F. Supp. 871, 873 (S.D. Houston 1998).

Petitioners have and are by their Petition “challenging the

actions, lack of actions and orders of the ... 239" Judicial

District Court of Texas as being unconstitutional .. .”'' Even if

Judge Hughes May 24, 2005 Order and Judge Sebestra’s January

26, 2004 Order of Severance were final judgments, the District

Court lacked jurisdiction to “review and reverse unfavorable

state-court judgments.” Exxon Mobil Corp. v. Saudi Basic Indus.

Corp., 544 U.S. 280, 283-284, 125 S. Ct. 1517, 161 L. Ed. 2d

454 (2005).

The Petitioners added a personal injury action arising out

of the alleged on-the-job injury of August 17, 2000. Ms. Adams’

claim for benefits arising out of the August 17, 2000 occurrence

was presented to and considered by the TWCC. (R.322) The

hearing officer held that Ms. Adams did not sustain a

compensable injury on August 17, 2000. (R. 328) Ms. Adams

did not file an appeal of this issue. Therefore, the finding that

11. Petition for Writ of Certiorari, Page 3.

17

Ms. Adams did not sustain a compensable injury on August 17,

2000 is a final determination of that issue. Tex. Lab. Code §

410.169, ESIS, Inc., Servicing Contractor v. Johnson, 908

S.W.2d 554, 562-563 (Tex. Civ. App.—Fort Worth 1995). Ms.

Adams’ exclusive remedy against her employer and its workers’

compensation carrier for the August 17, 2000 occurrence was

the recovery of workers’ compensation benefits. Tex. Lab. Code

§ 405.001(a). She is precluded from bringing a personal injury

action against Liberty Mutual or its insured based upon the

August 17, 2000 occurrence. Tex. Lab. Code § 405.001(a),

Simpson v. State, 998 S.W.2d 304, 306 (Tex. Civ. App.—Austin

1999).

II. There was no abuse of discretion in awarding or

affirming the award of statutory attorney’s fees to

Liberty Mutual the prevailing party in a removal

action and sanctioning the Petitioners because such

an award is authorized by 28 U.S.C. § 1447(c) when

there is no objectively reasonable basis for seeking

removal and Petitioners violated Rule 11 of the

Federal Rules of Civil Procedure.

A. Attorney’s fees

An order remanding the case may require payment of just

costs and any actual expenses, including attorney fees, incurred

as a result of the removal. 28 U.S.C.A. § 1447(c). The District

Court is empowered to award reasonable attorney’s fees

to successful litigants seeking remand of cases to state court.

Id., Fed. R. Civ. Proc. 54(d)(2). By filing its Motion to Remand,

Motion to Dismiss Pursuant to Rule 12(b), Motion to Dismiss

for Lack of Subject Matter Jurisdiction and Plea to the

Jurisdiction on June 30, 2005, within thirty (30) days of receiving

on June 9, 2005, Petitioner’s June 6, 2005 Notice of Removal,

and by being the prevailing party in such removal action,

LIBERTY MUTUAL qualified for an award of statutory

“ttomey’s fees. 28 U.S.C. § 1447(c). By filing its Motion for

18

Sanctions and Statutory Attorney’s Fees with a supporting

affidavit from the undersigned attorney contemporaneously with

its motion to dismiss and remand, Liberty Mutual met its burden

to show there is no objectively reasonable basis for the

Petitioners’ third removal and the unusual circumstances present

in this case. Martin v. Franklin Capital Corporation, 546 U.S.

132, 126 S. Ct. 704, 711 (2005).

Liberty Mutual’s Motion for Sanctions and Statutory

Attorney’s Fees set out the repetitive removal actions that

effectively delayed the state court case for almost three years

from the notice of the first removal on March 4, 2004. Petitioners

alleged in their June 6, 2005 (3) Notice of Removal that the

case became removable when on May 24, 2005, an Order was

signed by Judge Hughes denying Liberty Mutual’s Motion for

Sanctions and Statutory Attorney’s Fees. Considering the

circumstances and facts of this case as set out and argued above,

there is no objectively reasonable basis for Petitioners to assert

that Liberty Mutual’s cause of action involved a federal question

requiring federal jurisdiction as a result of an order denying a

statutory attorney’s fee request for fees in a prior removal action

between the same parties. Petitioners did not proffer any non-

frivolous argument or authority on this point in either the District

Court, the Court of Appeals or this Court. There was no basis,

either in law or fact, upon which Petitioners could have prevailed

on any of their claims. The District Court found that the June 6,

2005 removal was in bad faith and without substantial

justification.

As set forth in Johnson v. Georgia Highway Express, Inc.,

488 F.2d 714, 717-719 (5" Cir. 1974), the guidelines for

awarding attorney’s fees are:

1. Time and labor required;

2. The novelty and difficulty of the questions;

3. The skill requisite to perform the legal service properly;

19

4. The preclusion of other employment by the attorney

due to acceptance of the case;

5. The customary fee;

6. Whether the fee is fixed or contingent;

Time limitations imposed by the client or the

circumstances;

The amount involved and the results obtained;

9. The experience, reputation, and ability of the attorneys;

10. The “undesirability” of the case;

11. The nature and length of the professional relationship

with the client; and

12. Awards in similar cases. Johnson, 488 F.2d at 717-

719.

The Order granting the statutory attorney’s fees states on

its face that the Court considered the guidelines set forth in

Johnson, 488 F.2d at 717-719, and that according to such

guidelines, the amount of the fee requested by Liberty Mutual

was reasonable and necessary. (Pet. App. B)

Petitioners have not put forth any argument or authority to

claim that the District Court erred in awarding Liberty Mutual

its statutory attorney’s fees. Therefore, the Court of Appeals for

the Fifth Circuit did not abuse its discretion in affirming the

award of $10,750.00 in attorney’s fees.

B. Sanctions

The District Court did not abuse its discretion in sanctioning

Adams and Hedrick with monetary and non-monetary sanctions

because Adams’ and Hedrick’s conduct during the course of

this case violated Rule 11 of the Federal Rules of Civil

Procedure. The correct standard of review of a district court’s

order under Rule 11 is abuse of discretion. Cooter & Gell v.

20

Hartmarx Corp., 496 U.S. 384, 405 (1990). The central purpose

of Rule 11 is to deter baseless filings'* in district court and thus,

consistent with Rule Enabling Act’s grant of authority, streamline

administration and procedure of federal courts. /d. at 393.

‘Determining whether an attorney has violated

Rule 11 involves a consideration of three types of

issues. The court must consider factual questions

regarding the nature of the attorney’s prefiling

inquiry and the factual basis of the pleading or

other paper. Legal issues are raised in considering

whether a pleading is “warranted by existing law

or a good faith argument” for changing the law

and whether the attorney’s conduct violated Rule

11. Finally, the district court must exercise its

discretion to tailor an “appropriate sanction.”

Id. at 399.

By affirming the sanctions orders against Petitioners on the

basis that there was no abuse of discretion, the appellate court

applied the correct standard of review. Id. at 405.

“{I]jt is well established that a federal court may

consider collateral issues after an action is no

longer pending. ... [An] imposition of a Rule 1

sanction is not a judgment on the merits of an

action. Rather, it requires the determination of a

collateral issue: whether the attorney has abused

the judicial process, and if so, what sanction

would be appropriate.” /d., at 395-396, 110 S. Ct.,

at 2456. Such an order implicates no constitutional

concern because it “does not signify a district

court’s assessment of the legal merits of the

12. Petitioners object to the order of monetary and non-

monetary sanctions on the grounds that they are attempts to “silence

the constitutional issues of the case” and unfair. (Pctition for Writ

of Certiorari, p. 22)

21

complaint.” /d., at 396, 110 S.Ct., at 2456. It

therefore does not raise the issue of a district court

adjudicating the merits of a “case or controversy”

over which it lacks jurisdiction. Willy v. Coastal

Corp., 503 U.S. 131, 137-138 (1992).

1. Non-monetary sanctions

As argued before, the Petitioners’ three removal actions

were groundless and for delay purposes. (R. 261-264) Petitioners

failed to controvert the factual allegations in Liberty Mutual’s

Motion to Remand (R.258-264, 881-888) Petitioners’ modus

operandi is to remove to federal court, file pleadings alleging

conspiracy, fraud and criminal violations, request rulings without

hearings, move to disqualify opposing counsel and the judge,

move to strike opposing pleadings, request a stay, fail to appear

at hearings and file a notice of removal alleging Ms. Adams’

constitutional rights have been violated. (R. 115-120, 132-135,

136 — 141, 513-524, 540-550, 566-574, 876-880) The legal basis

of their removal, based upon the May 24, 2005 Order Denying

Liberty Mutual Insurance Company’s Motion for Sanctions and

Attorney Fees, was groundless and in bad faith. The District

Court’s power to decide a collateral issue of attorney’s fees did

not create federal question jurisdiction over Liberty Mutual’s

suit for judicial review. Willy v. Coastal Corp., 503 U.S. at 137-

138. The common denominator in all of the Petitioners’ filings

is a complaint of the violation of their due process with no

attempt to avail themselves of the procedure in place to prevent

the very same due process violation of which they complain.

Galloway v. Louisiana, 817 F.2d 1154, 1158 (Sth Cir. 1987)

(“An employee cannot ignore the process duly extended to him

and later complain that he was not accorded due process.”’).

Applying the test set forth in Cooter & Gell, 496 U.S. at

399, it was not an abuse of discretion for the District Court to

sanction the Petitioners with monetary and non-monetary

sanctions. The sanction was appropriately tailored to prevent

the continued filings of groundless removal actions whose

22

factual contentions are clearly baseless. Chambers v. NASCO,

Inc., 501 U.S. 32, 51 (1991).

By signing the June 6, 2005 Notice of Removal, Petitioners

certified that to the best of their knowledge, information and

belief, formed after inquiry reasonable under the circumstances,

that the claims and legal contentions of federal jurisdiction made

in their Notice of Removal were warranted by existing law or

by a nonfrivolous argument for the extension, modification,

or reversal of existing law or the establishment of new law.

Fed. R. Civ. P. 11(b)(2).

As evidenced by a comparison of the three Notices of

Removal filed by Petitioners (R. 513-524, 540-550 & 605-640),

the allegations are the same — violation of Ms. Adams’ right to

due process by not allowing her non-attorney husband to

represent her and federal question based upon the state court’s

granting the severance of the bad faith case — but each with a

new twist. The twist has ranged from allegations of not being

provided with proper representation as an alternative to

recognizing her husband as her attorney to allegations of

conspiracy and violations of numerous federal criminal statutes

that have no basis in fact or law. After two attempts to remove

on basically the same grounds and two remands, it is

inconceivable that the Petitioners thought that their claims in

the third Notice of Removal were warranted by existing law or

a non-frivolous argument.

Further, as evidenced by a comparison of the three Notices

of Removal, the facts and events made the basis of this 34

removal were known to them at the time of the F' removal.

Therefore, their statement of jurisdiction based upon the May

24, 2005 Order denying sanctions is merely an attempt to plead

around the untimely filing of this removal attempt. Clearly, the

federal question issues and the pleading, order or paper, that

they complain of (if indeed they have a legitimate complaint) is

the Order of Severance and Petitioners’ erroneous assertion that

Hedrick, a non-attorney, may represent his wife in court.

23

Pro se litigants have the duty to investigate the factual basis

of their lawsuit and are subject to the sanctions of Rule 11

for failure to do so. Business Guides, Inc. v. Chromatic

Communications Enterprises, Inc., 498 U.S. 533, 545-546, 564

(1991).

In determining whether Petitioners made reasonable inquiry

into the law governing this case, the Court may be guided by

Thomas vy. Capital Security Services, Inc. 836 F.2d 866, 875-

876 (5 Cir. 1988). Factors enumerated in Thomas include:

(1) time available to prepare the pleading

(2) plausibility of the legal argument

(3) pro se status of the litigant

(4) complexity of the legal and factual issues raised in

the case. Thomas at 875-876.

LIBERTY MUTUAL asserted that (1) as there was no

deadline to meet, sufficient time was available to Petitioners to

prepare their pleading; (2) their legal arguments lacked any

plausibility; (3) the pro se status of Petitioners had already been

granted accommodation since they had been involved in three

prior federal court proceedings and one appellate proceeding

involving this workers’ compensation case involving the similar

issues and legal arguments on Mr. Hedrick’s non-existent right

to represent his wife; (4) the complexity of this case was average

until the Petitioners began their course of action of removing

this case to federal court; and (5) as shown above, Petitioners

were prohibited from re-litigating the alleged August 17, 2000

on the job injury.

A sanction must be limited to what is sufficient to deter

repetition of such conduct or comparable conduct by others

similarly situated. Fed. R. Civ. P. 11(c)(2). The sanction

prohibiting Petitioners from filing any further pleadings in

federal court on this litigation is specific to this case alone, does

24

not abridge Petitioners’ right to file anything that is meritorious

and non-frivolous and protects Liberty Mutual from having to

defend against the Petitioners’ frivolous actions.

2. Monetary sanctions.

It was not an abuse of discretion for the District Court to

grant monetary sanctions because of the repeated removal

actions. No request for fees was made in the first removal. The

fee request for the second removal was denied. After the second

removal, Petitioners could not argue, and have not argued, that

they were unaware of the possibility that they could be ordered

to pay Liberty Mutual’s attorney’s fees. Had Petitioners stopped

after the second removal, they would not have been sanctioned.

Petitioners’ claims fall into the category described by Justice

Marshall in Neitzke v. Williams as “fantastic or delusional

scenarios”.!3 Neitzke v. Williams, 490 U.S. 319, 328, 109 S. Ct.

1827, 1833 (1989). But for Petitioners’ course of conduct,

Liberty Mutual would not have incurred additional attorney’s

fees to defend against the frivolous removal of this case to federal

court. Petitioner’s pleadings were a work in progress, adding a

new allegation or changing an approach to the same issue,

requiring close review to avoid overlooking a hidden issue.

Petitioners’ pleadings, the Affidavit of Mary Markantonis

(R. 314) filed with the District Court and the July 25, 2006

Order (R. 962-966) substantiate this point.

13. Petitioners alleged numerous criminal violations including

18 U.S.C. §§ 241, 242, 371 & 1512 (R. 13-22) Petitioners alleged a

conspiracy between Liberty Mutual’s former attorney, Liberty Mutual

and IBM “to violate civil rights and Title 18.” (R. 853, 868)

Petitioners sought to disqualify the undersigned counscl because she

was employed by the same law firm as the former attorney. (R. 867)

Petitioners alleged a conspiracy between the undersigned attorney

and the Fifth Circuit court employees because Liberty Mutual’s

request for extension of time to file brief was addressed to a specific

employee in the clerk’s office instead of the court’s clerk.

25

III. The Court of Appeals for the Fifth Circuit did not

abuse its discretion in awarding Liberty Mutual costs

and damages for attorney’s fees because the

Petitioners lacked an objectively reasonable basis for

seeking removal and their appeal was frivolous and

caused unnecessary delay and expense. Fed. R. App.

Proc. 38.

A. Lack of objectively reasonable basis

Liberty Mutual incorporates all its argument and authority

set forth in Sections I. and IL. above regarding lack of jurisdiction,

defect in the removal process and frivolous nature of this appeal

in support of its assertion that there was no objectively

reasonable basis for Petitioners to file the third Notice of

Removal in this case. Petitioners’ claims (legal representation

by non-attorney husband, violations of criminal statutes,

personal injuries for on the job injury found to be not

compensable) are legally frivolous because Liberty Mutual is

immune from the claims asserted by Petitioners. Tex. Lab. Code

§ 405.001(a); Neitzke, 490 U.S. at 327.

B. Petitioners’ appeal was frivolous.

As this was a workers’ compensation case, Petitioner’s prior

two attempts at removal had failed and federal statute provides

that review of an order of remand is barred, Petitioner’s appeal

of the third Order of Remand was frivolous because it had no

basis in fact or in law. 28 U.S.C. §§ 1445(c) & 1447(d). “[A]

finding of factual frivolousness is appropriate when the facts

alleged rise to the level of the irrational or the wholly incredible,

whether or not there are judicially noticeable facts available to

contradict them.” Denton v. Hernandez, 504 U.S. 25, 33, 112

S. Ct. 1728, 1733 (1992). (R. 525-531 & 595) Petitioners’ Notice

of Removal described claims arising out of fantastic or

delusional scenarios and therefore were frivolous. Neitzke, 490

U.S. at 327. (R. 10-24)

26

CONCLUSION

Respondent respectfully submits that, for the reasons set

forth above, this Court has no jurisdiction to review this case

on the merits or the issues presented by Petitioners and that the

Court should affirm the Court of Appeals’ Orders denying

Petitioner’s motions and granting Respondent costs and damages

so that the case may return to the District Court for determination

of that amount.

Respectfully submitted,

Mary M. MArRKANTONIS

DEAN G. Pappas & Assoc., P.-C.

10375 Richmond, Suite 1670

Houston, Texas 77042

(713) 914-6200

Attorneys for Respondent