Hunt v. Court of Chancery, 233, 2020

Background:

Thomas L. Hunt, a Texas lawyer admitted pro hac vice in Delaware, sent an insulting email to opposing counsel during litigation in the Court of Chancery (including the line: "I look forward to meeting you face to face, if your bladder can handle it").
Plaintiffs asked the Court of Chancery to revoke Hunt’s pro hac vice admission and to impose sanctions; Delaware counsel for Hunt apologized and characterized the email as an isolated error.
At the end of a teleconference on an unrelated motion, the Court of Chancery found the email violated Del. Lawyers’ R. Prof. Conduct 8.4(d), declined to revoke pro hac vice admission, but sua sponte ordered Hunt personally to pay $14,989 in opposing counsel’s fees.
Hunt appealed, arguing he was denied due process because the court imposed monetary sanctions without advance notice or an opportunity to be heard and that the email did not prejudice the administration of justice (placing disciplinary matters within the Supreme Court’s exclusive remit).
The Supreme Court considered procedural joinder issues, heard the merits de novo as to bar-governance questions, and the Delaware DOJ defended the Chancery Court’s order.
The Supreme Court reversed: due process required notice and a hearing before imposing monetary sanctions, and Hunt’s single rude email did not sufficiently prejudice the administration of justice to permit the trial court to enforce the disciplinary rule (so exclusive bar-discipline jurisdiction remained with the Supreme Court).

Issues:

Issue	Plaintiff's Argument	Defendant's Argument	Held
1) Whether the Court of Chancery lawfully imposed monetary sanctions sua sponte without notice/hearing	Court acted within its powers to sanction misconduct and awarded fees for bringing the email to the court’s attention	Hunt: denying advance notice and an opportunity to be heard violated due process	Reversed—due process required advance notice and an opportunity to respond (including oral hearing and inquiry into ability to pay for sizable monetary sanctions)
2) Whether Hunt’s email prejudiced the administration of justice so as to permit trial-court enforcement of the Lawyers’ Rules	Plaintiffs: email was prejudicial under DLRPC 8.4(d) and justified sanction	Hunt: email was rude but not prejudicial; disciplinary enforcement is for the Supreme Court	Held: email was inappropriate but did not rise to prejudicial conduct; exclusive disciplinary jurisdiction remains with the Supreme Court absent prejudice to the proceedings
3) Whether the appeal should be dismissed for failure to join plaintiffs as indispensable parties	Plaintiffs: they have the only pecuniary interest in the fee award and should be party	Hunt: proper notice and naming of Court of Chancery sufficed	Held: appeal not dismissed—plaintiffs had notice/opportunity and no substantial prejudice from nonjoinder
4) Scope of trial-court remedial options: monetary sanction v. referral to disciplinary counsel	Plaintiffs/Chancery: trial court may employ sanctions to deter and rectify abuse	Hunt: trial court should report to disciplinary counsel; sanctions for ethics violations are Supreme Court territory	Held: Trial courts retain powers to control proceedings, but may enforce ethics rules only when conduct prejudices the administration of justice; otherwise they should report to disciplinary authorities

Key Cases Cited

In re Appeal of Infotechnology, Inc., 582 A.2d 215 (Del. 1990) (Supreme Court has sole and exclusive responsibility over governance of the Bar; trial courts may not apply disciplinary rules in extra‑disciplinary proceedings absent prejudice to administration of justice)
Crumplar v. Superior Ct. ex rel. New Castle Cty., 56 A.3d 1000 (Del. 2012) (trial courts must afford heightened procedural protections when imposing sanctions sua sponte; exclusive bar‑discipline jurisdiction reiterated)
In re Hurley, 183 A.3d 703 (Del. 2018) (demeaning private correspondence can violate professional conduct rules but not necessarily prejudice the administration of justice when it has no direct impact on court proceedings)
Chambers v. NASCO, Inc., 501 U.S. 32 (U.S. 1991) (courts exercising inherent sanctioning power must comply with due process in determining bad faith and assessing fees)
In re Abbott, 925 A.2d 482 (Del. 2007) (extreme offensive conduct that forces a court to strike filings and explain its actions can be prejudicial to the administration of justice)