You may be shocked to hear this, but sometimes people lie, even in court. This is obviously true for the pleading stage as well. There are some ways to filter out the liars from the truth tellers. Rule 11 of Federal Civil Procedure outlines the ethical role lawyers have whenever anyone files something with the court. In essence, if you file something with the court, you are stating a belief (after conducting a reasonable inquiry) that the document has some support through evidence.
Reasonable Inquiry
Attorneys are expected to have done some initial investigation prior to filing with the court. What happens if an inexperienced (in a particular field) attorney fails to do their homework? See Hays.
Hays v. Sony Corp. of America
847 F.2d. 412 (7th Cir. 1988).
Hays filing was dismissed then Sony moved to put Rule 11 sanctions on him.
Question
Were the sanctions against the attorney merited?
Rule
The attorney must conduct a reasonable inquiry into the nature of the law.
Holding
He failed to do so, affirmed.
Facts
Hays was a high school teacher who developed a manual on how to use the software system. This manual was distributed to the district who asked Sony to make it compatible with their equipment. Sony did so for no charge and gave the manual back to the district who distributed it through the district.
Angry, Hays went to an attorney to sue for copyright infringement. The attorney filed suit for common law copyright and statutory copyright. However, he was inexperienced in copyright. The issue is that there was no common law copyright after the statutory copyright went into effect nearly 10 years before.
Sony moved to dismiss which was affirmed, and then moved to sanction the attorney for filing a frivolous claim.
Analysis
The issue here is that the attorney filed both meritorious and frivolous claims. His claim for common law was frivolous. However, he could have had a claim under statutory. Unfortunately, he bogged down his claim with frivolous filings. He asked for monetary damages, but these were frivolous. He could have gotten an injunction, but did not push for it.
As a result, he wasted the time and recourses of the opposition and the court.
In other words, Rule 11 is a malpractice claim for legal negligence. The only difference is that the victim is the other party, instead of the client. As a result, sanctions are merited. He should have done a reasonable inquiry which would have informed him of the “hopelessness” of his claim.
Additional Notes
This case has multiple claims, he had first claimed common law copyright infringement and statutory copyright law. The only issue was, common law copyright no longer existed, because of statutory copyright law had replaced it.
When the defendants recognized what happened, they filed a 12(b)(6) motion to dismiss. Additionally, they served a Rule 11 motion onto the plaintiff and waited 21 days before filing it with the court (when the plaintiff refused to fix the claim). What should have happened here is that the plaintiff drop the common law claim and depended only on the statutory copyright law. Instead, the court granted both the motion to dismiss and the motion for sanctions.
“By asserting claims without inquiring whether they have a plausible grounding in law and fact, a lawyer can impose on an adversary and on the judicial system substantial costs that would have been – and should have been – avoided by a reasonable pre-pleading inquiry.”
So, even if the attorney is not an expert in that field, they must do a reasonable inquiry to determine that both the facts and the law is accurate.
The consequence? The plaintiff needed to reimburse the attorney fees of the defendants.
Walker v. Norwest Corp.
108 F.3d 158 (8th Cir. 1997).
Walker and Massey (Walker’s attorney) lost and were sanctioned. They appealed.
Question
Was the dismissal and sanction appropriate?
Rule
The district court abuses its discretion if its ruling is based on an erroneous view of the law.
Holding
The court did not have an erroneous view of the law. Affirmed.
Facts
The plaintiffs were South Dakota residents who sued the defendants, a corporation in Minnesota but with a branch in South Dakota. They named the individuals from the branch as South Dakota residents. They tried to file in federal court. When the defendants received the complaint they told the plaintiffs to dismiss or to amend the complaint because it lacked complete diversity. When they refused to do so, the case was dismissed and Rule 11 Sanctions were imposed on the attorney.
Analysis
The law for diversity jurisdiction is well settled, there was no complete diversity. The dispute over the amount Sanctioned is also fine because the attorney made no efforts to produce evidence to support the claims he was making.
Additional Notes
The issue in this case was that this was filed in a federal court but was lacking complete diversity.
Christian v. Mattel, Inc.
286 F.3d 1118 (9th Cir. 2002).
Christian was represented by Hicks who was sanctioned by the trial court. Hicks appealed.
Question
Were the sanctions proper?
Rule
Rule 11 limits sanctions to conduct made during the pleading and filing stage.
Holding
The court examined more evidence other than pleadings, remanded to consider only the conduct at pleadings.
Facts
Hicks is the counsel for a the Collegiate Doll Company known for producing the “Claudine” doll. Mattel produces Barbie Dolls. Mattel had previously sued CDC for copyright infringement, but that was settled. Later, Christian, though Hicks, sued Mattel for copyright infringement.
However, the court determined that the claim was frivolous because there was no chance that Mattel could have copied CDC, having produced the copyright in question prior to the CDC doll’s existence. Because of the frivolous nature, and poor misconduct through previous and current proceedings, the court issued Rule 11 Sanctions. Hicks appealed.
Analysis
Yes, the claim was frivolous and he did not conduct an initial investigation. Yes, his conduct was unprofessional. However, Rule 11 only deals with the pleadings. Because the trial court mentioned other potential activities that could have influenced their decision to issue Sanctions. Therefore, it should be remanded to account for only the pleading stage.
I do not know the end result after remand, but I have the feeling that the sanctions stood.
Additional Notes
CDC made their doll in 1996. Mattel made their doll in 1991. Therefore, it is impossible that Mattel copied CDC’s doll. So, it is the responsibility of CDC to conduct a pre-filing inquiry to determine the copyright days. If they had done an inquiry they would have noticed the copyright was on the back of heads on Mattel’s dolls. However, when informed of the impossibility for a successful lawsuit (lacking the facts to support the claim).
Proper steps for a Rule 11 Motion:
- Serve the opposition with notice of a Rule 11 motion.
- Wait 21 days
- File a Rule 11 Sanctions motion with the court.
The reason for Rule 11 motions is to protect the court and opposition from unnecessary fees. As a result, Sanctions are appropriate.
However, in this case, the trial judge messed up. The court included materials from other parts of the proceedings (not just documents filed with the court). From these materials, the court determined that sanctions are appropriate. Instead, the focus needs to be on written documents to the court.
So, the trial judge needs to itemize which charges are associated with written representations to the court.
The takeaway from this case is that Rule 11 only manages the written representations to the court.
Additional Notes
Rule 11 governs the conduct of attorneys. Both attorneys and parties can be Sanctioned under Rule 11. The idea of the rule is that the attorney or party cannot make false representations to the court. To avoid these Sanctions, we need to have facts to be accurate (no contradictory facts) and make accurate statements about the facts.
So, when a client lies to you, as an attorney, have an obligation to make a reasonable investigation into the facts and into the law.
The takeaway from Rule 11:
- It governs written representation to the court. Rule 11 does not cover any interactions with other parties.
- This rule does not usually have anything to do with discovery.
- The only time verbal communications are governed is if the attorney discovers that something they wrote is no longer true (and orally stands by it).
If the attorney brings a lawsuit where they do not have a cause of action, they could be subject to Rule 11 Sanctions. The way to protect against this is to conduct a pre-filing reasonable investigation.
Procedure
Rule 11(c) provides rules for safe harbor sanctions. If the opposing party has made factual allegations or misrepresented the law, you could serve on them a rule 11 motion for sanctions. This is different though because it is actually backwards of normal filings. Here, we would first serve the 11 motion on the opposing party first. The other party then has 21 days of safe harbor. If the case is not dismissed within that time frame, then you would file it with the court.
The purpose of this procedure is to give the opposing party sufficient time to think about and correct the record.
Disclaimer
The content contained in this article may contain inaccuracies and is not intended to reflect the opinions, views, beliefs, or practices of any academic professor or publication. Instead, this content is a reflection on the author’s understanding of the law and legal practices.
