Shalaby v. Bernzomatic et al

Filing 148

ORDER: (1) denying 137 Plaintiff's Motion to Disqualify Judge Anthony J. Battaglia; Granting 139 Defendant's Motion for Attorney Fees with Amount to Be Determined Pending Defendants' Supplemental Briefing; and Denying 140 Plaintiff's Motion for Sanctions. Signed by Judge Anthony J. Battaglia on 2/3/2020. (mme)

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UNITED STATES DISTRICT COURT

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SOUTHERN DISTRICT OF CALIFORNIA

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ANDREW W. SHALABY,
Plaintiff,

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Case No.: 3:11-cv-00068-AJB-DHB
ORDER:

v.
(1) DENYING PLAINTIFF’S MOTION
TO DISQUALIFY JUDGE ANTHONY
J. BATTAGLIA (Doc. No. 137);

BERNZOMATIC, ET AL.,
Defendants.

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(2) GRANTING DEFENDANTS’
MOTION FOR ATTORNEYS’ FEES,
WITH THE AMOUNT TO BE
DETERMINED PENDING
DEFENDANTS’ SUPPLEMENTAL
BRIEFING (Doc. No. 139); AND

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(3) DENYING PLAINTIFF’S MOTION
FOR SANCTIONS (Doc. No. 140)

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Presently before the Court are: (1) Plaintiff Andrew W. Shalaby’s (“Plaintiff”)

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motion to disqualify Judge Anthony J. Battaglia, (Doc. No. 137); (2) Defendants’ motion

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for attorneys’ fees and costs, (Doc. No. 139); and (3) Plaintiff’s motion for sanctions, (Doc.

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No. 140.) For the reasons set forth below, the Court DENIES Plaintiff’s motion to

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disqualify Judge Battaglia, GRANTS Defendants’ motion for attorneys’ fees, with the

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amount to be determined pending Defendants’ supplemental briefing, and DENIES

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Plaintiff’s motion for sanctions.

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I.

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BATTAGLIA

PLAINTIFF’S MOTION TO DISQUALIFY JUDGE ANTHONY J.

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Plaintiff seeks to disqualify Judge Anthony J. Battaglia based on 28 U.S.C. § 455.

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Motions under section 455(a) are decided by the judge whose disqualification is sought.

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See 28 U.S.C. § 455(a). Pursuant to 28 U.S.C. § 455(a), a district judge “shall disqualify

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himself in any proceeding in which his impartiality might reasonably be questioned.” 28

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U.S.C. § 455(a). Pursuant to § 455(b), a district judge must disqualify himself “[w]here he

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has a personal bias or prejudice concerning a party, or personal knowledge of disputed

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evidentiary facts concerning the proceeding.” 28 U.S.C. § 455(b). A district judge has

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discretion to deny a motion to recuse. United States v. Nackman, 145 F.3d 1069, 1076 (9th

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Cir. 1998). The standard for recusal under § 455 is “whether a reasonable person with

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knowledge of all the facts would conclude that the judge’s impartiality might reasonably

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be questioned.” Mayes v. Leipziger, 729 F.2d 605, 607 (9th Cir. 1984) (internal quotations

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omitted).

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In this case, Plaintiff’s sole basis for asserting that Judge Battaglia should recuse is

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Plaintiff’s own disagreement with the Court’s prior rulings. Specifically, Plaintiff argues

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Judge Battaglia: (1) ignored Plaintiff’s affidavit seeking to disqualify and issued an order

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granting Defendant Bernzomatic’s motion for sanctions, (2) allowed filings by Defendant

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Bernzomatic, and (3) failed to acknowledge that the prefiling order was nullified by other

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documents. (Doc. No. 137 at 8–11.)

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However, the United States Supreme Court has explicitly held that judicial rulings

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and the opinions formed by judges on the basis of facts introduced in the course of

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proceedings “almost never constitute a valid basis for a bias or partiality motion.” Liteky v.

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United States, 510 U.S. 540, 555 (1994); see also United States v. Holland, 519 F.3d 909,

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913 (9th Cir. 2008) (“[Section] 455 is limited by the ‘extrajudicial source’ factor which

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generally requires as the basis for recusal something other than rulings, opinions formed or
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statements made by the judge during the course of the [case.]”). “Put differently, the

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judge’s conduct,” including “the mere fact that a judge has previously expressed an opinion

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on a point of law,” or has issued adverse “prior rulings in the proceeding,” does not “except

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in the rarest of circumstances” form the sole basis for recusal under § 455(a).” Holland,

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519 F.3d at 914 (citations omitted); see also Leslie v. Grupo ICA, 198 F.3d 1152, 1159–60

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(9th Cir. 1999).

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Here, Plaintiff has made no showing of “rare circumstances” of any sort. Liteky, 510

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U.S. at 555. Indeed, Plaintiff has only put forth adverse rulings as the grounds for Plaintiff’s

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motion to disqualify. Completely absent from Plaintiff’s motion is any extrajudicial source

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of bias to justify disqualification. As such, Plaintiff has simply failed to show that “a

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reasonable person with knowledge of all the facts would conclude that [Judge Battaglia’s]

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impartiality might reasonably be questioned.” Mayes, 729 F.2d at 607.
Therefore, Plaintiff’s motion to disqualify Judge Battaglia is DENIED.

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II.

DEFENDANTS’ MOTION FOR ATTORNEYS’ FEES AND COSTS

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Defendants move for attorneys’ fees and costs pursuant to the Court’s order dated

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August 15, 2019. (Doc. No. 131.) In the Court’s order, (Doc. No. 131), the Court granted

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Defendants’ request for monetary sanctions against Plaintiff for reasonable attorney’s fees

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and costs expended for (1) bringing Defendants’ motion for contempt and sanctions, and

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(2) defending against Plaintiff’s attempt to enter his case into the proposed MDL in the

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Central District of California. (Id. at 3.) The Court instructed Defendants to file a motion

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for attorneys’ fees and cost. (Doc. No. 131 at 3.) Defendants did so, and now move the

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Court for the award of attorneys fees’ in the amount of $28,668.41, payable to the “Holland

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& Knight LLP Client Trust Account.” (Doc. No. 139 at 2.)

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Plaintiff opposes the motion for attorneys’ fees, arguing that this Court lacked

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jurisdiction to issue the order on Defendants’ motion for contempt and sanctions because

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Plaintiff filed an affidavit of disqualification pursuant to 28 U.S.C. § 144. (Doc. No. 141

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at 10.) Plaintiff’s contention is the filing of the affidavit on August 4, 2019 deprived this

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Court of jurisdiction to issue an order on Defendants’ motion for contempt and sanctions
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on August 15, 2019. (Doc. No. 141 at 10.) Specifically, Plaintiff contends section 144

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provides that after a party files a “timely and sufficient affidavit” regarding the personal

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bias or prejudice of the presiding judge, “such judge shall proceed no further therein, but

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another judge shall be assigned to hear such proceeding.” 28 U.S.C. § 144. However, the

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Ninth Circuit has held that “[o]nly after the legal sufficiency of the affidavit is determined

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does it become the duty of the judge to ‘proceed no further’ in the case.” United States v.

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Azhocar, 581 F.2d 735, 738 (9th Cir. 1978) (internal citations omitted). Plaintiff’s affidavit

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was first stricken from the docket on August 15, 2019 for violation of local and chamber

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rules. (Doc. No. 134 at 1.) Plaintiff then filed a motion to disqualify pursuant to 28 U.S.C.

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§ 455 and 28 U.S.C. § 144 on August 26, 2019. (Doc. No. 137.) On September 7, 2019,

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Plaintiff withdrew his motion to disqualify based only on 28 U.S.C. § 144. (Doc. No. 145.)

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Therefore, the Court did not determine the legal sufficiency of the affidavit, and thus was

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not deprived of jurisdiction to issue its order.

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Plaintiff additionally points out that Defendants’ motion for attorneys’ fee does not

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include any fee statements. (Doc. No. 141 at 16.) Defendants state that legal billing records

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are privileged because they communicate information for the purpose of legal

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representation and Plaintiff is not entitled to them. (Doc. No. 146 at 3.) The Court agrees

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with Plaintiff that itemized fee statements should be provided. To calculate an award of

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attorneys’ fees, courts employ the lodestar method set forth in Hensley v. Eckerhart, 461

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U.S. 424, 433 (1983), in which courts multiply the number of hours reasonably expended

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on the litigation by a reasonable hourly rate. “The party seeking the award should provide

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documentary evidence to the court concerning the number of hours spent, and how it

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determined the hourly rate(s) requested.” McCown v. City of Fontana, 565 F.3d 1097, 1102

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(9th Cir. 2009). Here, Defendants submitted a motion and declaration with only the amount

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to be reimbursed and nothing more. Without any itemized fee statements or a declaration

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as to the amount of hours billed and hourly rates, the Court is left without any documentary

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evidence to determine the reasonableness of the amount Defendants seek in attorneys’ fees.

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To alleviate Defendants’ concerns regarding privileged information, Defendants may
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submit redacted fee statements and redact any privileged or confidential information

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contained therein. Davis v. Los Angeles W. Travelodge, No. CV08-08279 CBM(CTX),

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2009 WL 5227897, at *1 (C.D. Cal. Dec. 21, 2009) (“Although Defendant may redact

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confidential information contained in such invoices, Defendant must provide some

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evidence to corroborate the number of hours specified in Defendant’s Motion.”).

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Accordingly, the Court GRANTS Defendants’ motion for attorneys’ fees, with the

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amount awarded to be decided pending Defendants’ supplemental briefing. Defendants

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may have until February 17, 2020 to submit supplemental briefing detailing the

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reasonableness of Defendants’ attorneys’ fees, and include itemized fee statements, with

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privileged and confidential information redacted. Plaintiff may file a response in

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opposition, not exceeding 15 pages in length, by March 2, 2020. Defendants may file a

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reply in support of the supplemental briefing, not to exceed 10 pages in length, by March

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9, 2020.

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III.

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HURWITZ, HOLLAND & KNIGHT LLP, AND NEWELL OPERATING

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COMPANY, INC.

PLAINTIFF’S MOTION FOR SANCTIONS AGAINST SHELLEY G.

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Plaintiff additionally moves for Rule 11 sanctions based on Defendant’s filing of its

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motion for contempt and sanctions for Plaintiff’s violation of the Court’s June 27, 2012

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prefiling order (“Contempt Motion”). (Doc. No. 119.) Plaintiff seeks as sanctions,

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termination of the June 27, 2012 prefiling order based on various grounds, which the Court

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will address below. (Doc. No. 140-1.)

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Rule 11 sanctions are warranted when a party files a lawsuit or motion that is

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frivolous, legally unreasonable, without factual foundation, or is otherwise brought for an

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improper purpose. Warren v. Guelker, 29 F.3d 1386, 1388 (9th Cir. 1994). Under the plain

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language of Rule 11, when one party seeks sanctions against another, the Court must first

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determine whether any provision of Rule 11(b) has been violated. Id. at 1389. If the Court

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determines that Rule 11(b) has been violated, the Court “may impose an appropriate

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sanction on any attorney, law firm, or party that violated the rule or is responsible for the

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violation.” Fed. R. Civ. P. 11(c)(1).

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Plaintiff urges the Court to impose sanctions based on Defendant’s Contempt

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Motion. However, the Contempt Motion was fully briefed by both parties, and was

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subsequently granted by the Court. (Doc. No. 131.) There is no evidence that the Contempt

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Motion was “frivolous, legally unreasonable, without factual foundation, or [] otherwise

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brought for an improper purpose.” Warren, 29 F.3d at 1388. To the contrary, the Court

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held that the Contempt Motion was with merit and found Plaintiff in contempt of the

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Court’s prefiling order when Plaintiff failed to show he sought this Court’s leave to file his

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case as a related case in another court’s MDL. (Doc. No. 131 at 1.)

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Plaintiff also argues sanctions are warranted because Defendant’s Contempt Motion

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violated California anti-SLAPP laws. (Doc. No. 140-1 at 4.) The Court notes that Plaintiff

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had the opportunity to raise his anti-SLAPP argument in his opposition to the Contempt

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Motion. (Doc. No. 127.) But Plaintiff elected not to do so. In any event, the Court disagrees

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with Plaintiff’s position. As Plaintiff points out, California’s anti-SLAPP statute provides

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“a procedure for expeditiously resolving ‘nonmeritorious litigation meant to chill the valid

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exercise of the constitutional rights of freedom of speech and petition in connection with a

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public issue.’” Hansen v. California Dep’t of Corr. & Rehab., 171 Cal. App. 4th 1537,

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1542–43 (2008). As explained above, the Court reviewed Defendant’s Contempt Motion,

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and Plaintiff’s briefing in opposition, and determined that the Defendant’s position was not

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lacking in merit. Additionally, Defendant’s Contempt Motion cannot reasonably be

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construed as an attempt to retaliate against Plaintiff for exercising his right to free speech.

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Rather, Defendant’s Motion was brought in response to Plaintiff’s clear violation of the

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Court’s prefiling order, which did not limit Plaintiff’s right to petition courts for redress,

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but simply ordered Plaintiff to obtain leave of Court before filing specific actions.

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Plaintiff also provides other grounds for the imposition of sanctions, none of which

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warrant the award of sanctions. For example, Plaintiffs allege Defendants misrepresented

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the letter on an exhibit attached to the Contempt Motion as Exhibit C when it was in fact
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Exhibit B. (Doc. No. 140-1 at 9.) There is no basis from which the Court can conclude that

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Defendant’s use of “Exhibit C” instead of “Exhibit B” was intended to mislead the Court

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or otherwise achieve some improper purpose. “Rule 11 is intended to deter baseless filings

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in district court and imposes a duty of reasonable inquiry so that anything filed with the

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court is well grounded in fact, legally tenable, and not interposed for any improper

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purpose.” Islamic Shura Council of S. California v. F.B.I., 757 F.3d 870, 872 (9th Cir.

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2014) (internal quotation marks omitted). As Plaintiff still does not deny he failed to seek

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leave to file his case in another court’s MDL, Defendant’s filing of its Contempt Motion

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was clearly not baseless or for an improper purpose.

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Based on the foregoing, the Court DENIES Plaintiff’s motion for sanctions.

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A.

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In his reply, Plaintiff also asks the Court to take judicial notice of a sentence from

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Defendants’ brief in support of their motion for attorneys’ fees. (Doc. No. 147 at 1.) The

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portion of the brief reads, “Newell’s legal billing records are privileged because they

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communicate information for the purpose of legal representation and Shalaby is not entitled

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to them.” (Doc. No. 146 at 2.) Regardless of whether a request for judicial notice is

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appropriate, the Court has considered the filings on its own docket. In considering the

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parties’ briefing and arguments, the Court finds that the sentence has no bearing on the

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Court’s conclusion that sanctions are unwarranted. Accordingly, the Court DENIES AS

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MOOT Plaintiff’s request for judicial notice.

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Request for Judicial Notice and Request for Hearing

In addition, the Court finds that these matters are suitable for determination without
a hearing pursuant to Local Rule 7.1.d.1 and DENIES Plaintiff’s request for a hearing.

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IV.

CONCLUSION

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In light of the foregoing, the Court orders as follows:

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1. Plaintiff’s motion to disqualify Judge Anthony J. Battaglia is DENIED.

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2. Defendant’s motion for attorneys’ fees is GRANTED, with the amount to be

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determined pending Defendant’s supplemental briefing.
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o Defendants may have until February 17, 2020 to submit supplemental

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briefing detailing the reasonableness of Defendants’ attorneys’ fees, and

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include itemized fee statements.

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o Plaintiff may file a response in opposition, not exceeding 15 pages in
length, by March 2, 2020.
o Defendants may file a reply in support of the supplemental briefing, not
to exceed 10 pages in length, by March 9, 2020.
3. Plaintiff’s motion for sanctions against Shelley G. Hurwitz, Holland & Knight
LLP, and Newell Operating Company, Inc. is DENIED.

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IT IS SO ORDERED.

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Dated: February 3, 2020

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