Billie Redding v. Prosight Specialty Management
692 F. App'x 447
| 9th Cir. | 2017Background
- Plaintiff Billie Redding sued New York Manufacturers (NYM); counsel Lin Deola, Brian Miller, and Richard Layne represented Redding.
- The district court granted summary judgment for NYM and found certain plaintiff motions and conduct frivolous or in violation of court orders.
- The district court imposed monetary sanctions (attorneys’ fees and costs) under its inherent authority and 28 U.S.C. § 1927, totaling $515,119.90 against Deola, Miller, and Layne.
- Specific sanctions: $73,934.82 for a frivolous motion to disqualify NYM’s lead counsel; $33,932.72 for violations of a February 3, 2014 discovery order (Rule 37(b)(2)(C)); additional fees based on overall conduct.
- Appellants received notice and an opportunity to be heard via the summary judgment order, NYM’s fee motion, briefing, and affidavits.
- On appeal, the Ninth Circuit affirmed in part, reversed as to Layne, and remanded for reassessment of the sanction amount against Deola and Miller; costs of appeal taxed to Deola and Miller.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether fees awarded are civil vs. criminal | Redding sought relief through counsel; sanctions compensate NYM’s losses so civil | Appellants implied sanctions punitive? | Civil sanction standard applies (compensatory) |
| Whether appellants received due process before sanction | Redding (via counsel) had notice through summary judgment and fee motion; briefed and submitted affidavits | Appellants argued inadequate notice/opportunity to be heard | District court provided adequate notice and opportunity; no error |
| Whether prelitigation conduct may inform bad-faith sanctions | Redding pointed to counsel’s prelitigation and in-court conduct supporting sanctions | Appellants contended sanctions should be based only on litigation conduct | Court may consider totality of circumstances including prelitigation conduct |
| Whether each attorney acted in bad faith or recklessly to justify sanctions | Redding argued Deola, Miller, and Layne acted in bad faith/recklessly warranting fees | Appellants denied bad faith; challenged sufficiency of evidence and amounts | Deola and Miller: bad faith/reckless supported; sanctions against Layne reversed for insufficient evidence; remand to reassess amounts |
Key Cases Cited
- Int’l Union, United Mine Workers of Am. v. Bagwell, 512 U.S. 821 (1994) (distinguishes civil fines from criminal contempt and defines compensatory civil fines)
- United States v. Mine Workers, 330 U.S. 258 (1947) (compensatory nature of civil fines to reimburse complainant)
- Lasar v. Ford Motor Co., 399 F.3d 1101 (9th Cir. 2005) (due process requirements for sanctions: notice and opportunity to be heard)
- T.W. Elec. Serv., Inc. v. Pac. Elec. Contractors Ass’n, 809 F.2d 626 (9th Cir. 1987) (standards for sanctions under inherent authority)
- Pac. Harbor Capital, Inc. v. Carnival Air Lines, Inc., 210 F.3d 1112 (9th Cir. 2000) (permitting affidavits and briefing on fee motions; procedural due process in fee awards)
- Rodriguez v. United States, 542 F.3d 704 (9th Cir. 2008) (courts may consider prelitigation conduct in bad-faith determinations)
- Cazares v. Barber, 959 F.2d 753 (9th Cir. 1992) (totality of circumstances, including pretrial behavior, relevant to bad-faith findings)