Siegel et al v. Dignity Health

Filing 188

ORDER: Plaintiffs' Motion to Vacate Sanctions Order 172 is denied. Plaintiffs' Response and Objections to Defendant's Declaration of Attorneys' Fees and Costs 187 is sustained in part. Plaintiffs' counsel Elizabeth Tate is sanctioned in the amount of $8,814.75, for costs and attorneys' fees incurred by Defendant when filing its Motion for Sanctions. See order for additional details. Signed by Judge Steven P Logan on 2/19/2020. (LMR)

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IN THE UNITED STATES DISTRICT COURT

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FOR THE DISTRICT OF ARIZONA

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Mitchell Siegel, et al.,

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Plaintiffs,
vs.

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Dignity Health,
Defendant.

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No. CV-14-02561-PHX-SPL
ORDER

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Before the Court are Plaintiffs’ Motion to Vacate Sanctions Order (Doc. 172) and

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Plaintiffs’ Response and Objections to Defendant’s Declaration of Attorneys’ Fees and

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Costs (Doc. 187).

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On January 28, 2020—one week before the start of trial in this case—Defendant

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motioned the Court for sanctions against Plaintiffs and their counsel due to their behavior

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throughout this litigation. (Doc. 136) Among other things, Defendant stated that Plaintiffs

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and their counsel had repeatedly failed to abide by the Court’s order to: 1) exchange

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outlines for their opening statements so that the parties could ensure that neither side would

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run afoul of the Court’s motion in limine rulings; 2) stipulate to exhibits and deposition

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testimony for use at trial; and 3) serve subpoenas for Plaintiffs’ potential witnesses to be

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called at trial. (Doc. 136 at 7) More egregiously, Defendant asserted that Plaintiffs and their

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counsel had falsely represented the history of the parties’ settlement negotiations to the

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media—which resulted in a story about the case being published in the local newspaper.

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(Doc. 136 at 7-9) On January 31, 2020, the Court held a hearing and found that sanctions

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were appropriate as to Plaintiffs’ counsel Elizabeth Tate. (Doc. 145) The Court then

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Ordered Defendant to submit a declaration of costs and attorneys’ fees associated with the

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filing of the motion for sanctions. (Doc. 145) On February 3, 2020, Defendant submitted

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the declaration. (Doc. 146) On February 13, 2020, during trial, Ms. Tate filed the Motion

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to Vacate Sanctions Order. (Doc. 172) The parties presented oral arguments on the Motion

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the next day. (Doc. 175)

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Ms. Tate argued that there was no factual or legal basis for the Court to impose the

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sanctions, and that the Court should vacate the sanctions pursuant to Federal Rule of Civil

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Procedure (“Rule”) 54(b). (Doc. 172 at 3-8) Specifically, Ms. Tate argued that, although

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the Court has the inherent power to impose sanctions, the Court was required to make an

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explicit finding of bad faith prior to sanctioning her. (Doc. 172 at 3-8)

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In response, Defendant presented oral argument that the Motion was effectively a

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motion for reconsideration of the Court’s prior order imposing sanctions, and Ms. Tate

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failed to meet the legal standard for a motion for reconsideration. Additionally, Defendant

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argued that Ms. Tate was repeatedly warned throughout the case that she had a

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responsibility to learn the Federal Rules of Civil Procedure, the District of Arizona’s Local

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Rules, and the procedural requirements outlined in this Court’s Orders. Defendant asserted

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that the repeated violation of those rules and Orders amounted to a deliberate decision by

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Ms. Tate to fail to meet the standards necessary to appear in federal court. Furthermore,

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Defendant argued that all of Ms. Tate’s conduct throughout the case should be considered

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as tantamount to bad faith, and therefore, the Court had sufficient cause to order sanctions

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against her. After the trial, Ms. Tate filed the Plaintiffs’ Response and Objections to

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Defendant’s Declaration of Attorneys’ Fees and Costs. (Doc. 187)

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Here, the Defendant requested sanctions pursuant to 28 U.S.C. § 1927, not the

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Court’s inherent sanctioning power, so the legal standard that Ms. Tate relies on is

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improper. (Docs. 136 at 1; 172) The statute states that an attorney who causes the

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proceedings in a case to be multiplied “unreasonably and vexatiously” may be required to

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pay the excessive costs incurred because of such conduct. 28 U.S.C. § 1927. The Court
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finds that it was within its discretion to sanction Ms. Tate under 28 U.S.C. § 1927 due to

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the behavior alleged in Defendant’s motion and in the arguments made before the Court.

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Therefore, the Court will not vacate the ruling. See Pac. Harbor Capital, Inc. v. Carnival

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Air Lines, Inc., 210 F.3d 1112, 1118 (9th Cir. 2000) (explaining that a district court is not

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required to make an explicit finding of bad faith under 28 U.S.C. § 1927 when the record

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supports a finding that an attorney’s conduct amounted to “knowing or reckless” conduct);

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see also Baldwin Hardware Corp. v. FrankSu Enterprise Corp., 78 F.3d 550, 562 (9th Cir.

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1996) (stating that although the court did not use the words “bad faith” in imposing

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sanctions under 28 U.S.C. § 1927, the record supported a finding that the court deemed the

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attorney’s actions to be at least reckless).

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As it relates to the declaration submitted by Defendant’s counsel (Doc. 146) and

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Ms. Tate’s objection (Doc.187), the Court has reviewed the costs and attorneys’ fees

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submitted by Defendant. The Court finds that a reduced award of $2,166 for travel costs

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and $6,648.75 for attorneys’ fees is reasonable. See Kerr v. Screen Extras Guild, Inc., 526

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F.2d 67, 70 (9th Cir. 1975) (listing factors to consider in an award of attorneys’ fees),

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abrogated on other grounds by City of Burlington v. Dague, 505 U.S. 557 (1992).

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Accordingly,

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IT IS ORDERED that Plaintiffs’ Motion to Vacate Sanctions Order (Doc. 172) is
denied.

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IT IS FURTHER ORDERED that Plaintiffs’ Response and Objections to

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Defendant’s Declaration of Attorneys’ Fees and Costs (Doc. 187) is sustained in part.

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Plaintiffs’ counsel Elizabeth Tate is sanctioned in the amount of $8,814.75, representing

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the reasonable costs and attorneys’ fees incurred by Defendant when filing its Motion for

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Sanctions (Doc. 136).

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Dated this 19th day of February, 2020.

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Honorable Steven P. Logan
United States District Judge

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