Travelers Casualty and Surety v. Bennett Development, et al

Filing 28

ORDER to SHOW CAUSE signed by Judge William B. Shubb on 8/19/2009. Within 10 days of date of this Order, defendant Bennett Development Inc. shall either send Clerk a check in amount of $150 as sanctions for violation of Court's 1/21/2009 [5 ] Order, or shall Brief to SHOW CAUSE why it should not be sanctioned for failure to comply. Within 10 days of Order, Bennett Development shall file its Disclosure Statement as previously ordered. Status Conference is CONTINUED to 9/21/2009 at 02:00 PM in Courtroom 5 (WBS). (Marciel, M)

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 UNITED STATES DISTRICT COURT EASTERN DISTRICT OF CALIFORNIA ----oo0oo---TRAVELERS CASUALTY AND SURETY COMPANY OF AMERICA, a Connecticut corporation, Plaintiff, v. BENNETT DEVELOPMENT, INC., a California corporation; DENNIS G. BENNETT, an individual and as Trustee of THE BENNET FAMILY TRUST; CATHRYN C. BENNETT, an individual; FAHRENS CREEK ONE, LLC, a California limited liability company; FAHRENS CREEK TWO, LLC, a California limited liability company; and TULARE WINDMILL VENTURE, LLC, a California limited liability company, Defendants. / ----oo0oo---The court has an obligation to recuse itself from any case in which the judge might have a "financial interest," however small. 28 U.S.C. § 455(b)(4). To assist the court in NO. CIV. 09-174 WBS GGH ORDER TO SHOW CAUSE

carrying out this obligation, and because corporate parties are 1

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in the best position to identify their parent and subsidiary corporations, Federal Rule of Civil Procedure 7.1 and this court require all non-governmental corporate entities to submit corporate disclosure statements. Without this information, the

court risks retaining a case in which it unknowingly has a financial interest. Not only would the undersigned judge face

public criticism in such a circumstance, but the public's confidence in an impartial judiciary would be eroded. Failure to

assist the court in protecting these and other interests advanced by § 455(b)(4)--particularly in light of a direct request from the court--amounts to sanctionable conduct. See Fed. R. Civ. P.

16(f); Wong v. Regents of Univ. of Cal., 410 F.3d 1052, 1060 (9th Cir. 2005) (explaining that "[p]arties must understand that they will pay a price for failure to comply strictly with scheduling and other orders, and that failure to do so may properly support severe sanctions"); see also F.J. Hanshaw Enters., Inc. v. Emerald River Dev., Inc., 244 F.3d 1128, 1136 (9th Cir. 2001) (providing that federal courts' inherent powers "to manage their cases and courtrooms effectively and to ensure obedience to their orders" includes the authority to impose sanctions). In its Order Setting Status (Pretrial Scheduling) Conference issued in this case on January 21, 2009, the court unequivocally instructed any non-governmental corporate party to include its corporate disclosures in the parties' Joint Status Report: In order to assist the court in meeting its recusal responsibilities, any non-governmental corporate party to this action shall submit a statement identifying all its parent and subsidiary corporations and listing any publicly held company that owns 10% or more [of] the 2

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party's stock. Such statement shall be included in the parties' Joint Status Report. If any non-governmental corporate party has no parent or subsidiary corporations or no public[ly] held companies owning 10% or more of its stock, it shall so state in the Joint Stat[u]s Report. Failure to comply with the foregoing requirements of this paragraph will result in the Joint Status Report being stricken and such other sanctions as may be appropriate. Thereafter, if there is any change in the information, the party shall file and serve a supplemental statement within a reasonable time after such change occurs. (Jan. 21, 2009 Order ¶ 6.) Bennett Development Inc., a California corporation, appears as a defendant in this litigation but has not included a corporate disclosure statement, as required by this court's order, in the Joint Status Report filed in preparation for the Status (Pretrial Scheduling) Conference initially scheduled for August 24, 2009. (Docket No. 19.)

IT IS THEREFORE ORDERED that, within ten days of the date of this Order, defendant Bennett Development Inc. shall either send to the Clerk of this Court a check in the amount of $150 as sanctions for violation of this court's Order of January 21, 2009, or shall file a brief to show cause why it should not be sanctioned in such amount for failure to comply with such Order; IT IS FURTHER ORDERED that within ten days of the date of this Order, defendant Bennett Development Inc. shall file its corporate disclosure statement as previously ordered by this court; and IT IS FURTHER ORDERED that the Status (Pretrial

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Scheduling) Conference scheduled for August 24, 2009, is continued to September 21, 2009 at 2:00 p.m. DATED: August 19, 2009

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