Leslie Smith v. Psychiatric Solutions, Inc.
750 F.3d 1253
11th Cir.2014Background
- Leslie Smith, a former counselor, sued Gulf Coast Treatment Center and parent companies under the Sarbanes–Oxley Act (SOX) and the Florida Whistle-Blower Act (FWA) for retaliatory discharge; the district court granted summary judgment to defendants and this Court affirmed.
- After judgment, defendants moved for attorneys’ fees under the FWA; Smith filed late motions seeking leave to pursue §1927 sanctions and a Rule 11 motion challenging aspects of defendants’ fee memorandum.
- The magistrate judge recommended denying Smith’s Rule 11 motion, awarding defendants fees for opposing that motion, and granting defendants’ FWA fee motion; the district court adopted the recommendations.
- The district court ordered Smith to pay $53,925.98 in FWA attorneys’ fees and Smith’s counsel to pay $5,338.20 for opposing the Rule 11 motion; it denied Smith leave to pursue §1927 sanctions as untimely.
- Smith appealed contesting (1) that SOX preempts the FWA fee provision, (2) the propriety of the FWA fee award, (3) the award of fees for opposing her Rule 11 motion, and (4) the denial of leave to seek §1927 sanctions.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether SOX preempts the FWA fee provision | SOX’s fee provision (awarding fees to prevailing employees) conflicts with FWA’s authorization of fees to prevailing employers, so federal law preempts state fee awards | No conflict: SOX is silent about defendant fees and does not forbid state-law fee awards; both statutes can operate concurrently | No preemption: SOX does not prevent FWA fee awards and does not frustrate SOX’s objectives |
| Whether the district court abused its discretion awarding fees under the FWA | Fees improper regardless of preemption; Smith’s FWA claim lacked merit but fee award inappropriate | District court properly exercised discretion based on claim’s lack of merit, litigation scope, and counsel’s conduct | Fee award affirmed: district court’s reasoned analysis and factual findings fall within discretion |
| Whether fees for opposing Smith’s Rule 11 motion were proper | Rule 11 motion was legitimate to correct alleged misrepresentations; opposing fees unjustified | Smith’s Rule 11 filing was meritless/partly harassing and thus defendants are entitled to fees for opposing it | Affirmed: district court did not abuse discretion; Rule 11 motion was largely improper and trivial in parts |
| Whether denial of leave to file §1927 sanctions was improper | No filing deadline applied to §1927 motions; delay excusable because conduct occurred later | District court set a 30‑day deadline for all fee motions; Smith filed 21 months late and forfeited later excuse by not raising it below | Affirmed: district court acted within docket-control authority and did not abuse discretion in denying leave |
Key Cases Cited
- Mutual Pharm. Co., Inc. v. Bartlett, 133 S. Ct. 2466 (conflict preemption principle explained)
- Hillman v. Maretta, 133 S. Ct. 1943 (framework for evaluating whether state law frustrates federal objectives)
- Fox v. Vice, 131 S. Ct. 2205 (deference to district courts on fee allocations and avoiding appellate micromanagement)
- Cooter & Gell v. Hartmarx Corp., 496 U.S. 384 (abuse-of-discretion standard for Rule 11 review)
- Chang v. Chen, 95 F.3d 27 (federal fee-shifting for plaintiffs does not necessarily bar defendant fee recovery authorized elsewhere)
- Peer v. Lewis, 606 F.3d 1306 (standard of review for denial of §1927 relief)
- Chudasama v. Mazda Motor Corp., 123 F.3d 1353 (district courts’ broad docket-control discretion)
- Bonner v. City of Prichard, 661 F.2d 1206 (Eleventh Circuit adoption of former Fifth Circuit precedent)