WATKINS v. CAPITAL CITY BANK et al
Filing
114
ORDER GRANTING in part 70 Motion for Sanctions. The Court ORDERS: Geneva Watkins and those acting in concert with her are ENJOINED from filing against the Bank any lawsuit, action, proceeding, or matter asse rting claims arising from allegedly fraudulent force placed insurance without first seeking leave of the court in which the suit is to be filed; in seeking such leave, Geneva Watkins, or anyone acting in concert with her, shall provide the court with a copy of this Order and the Order granting summary judgment (Doc. 86) so that the court may determine if the lawsuit, action, proceeding, or matter is barred by res judicata or collateral estoppel; and Attorneys fees are awarded in the amount of $19,488.32. Ordered by US DISTRICT JUDGE MARC THOMAS TREADWELL on 4/11/2016 (tlh)
IN THE UNITED STATES DISTRICT COURT
FOR THE MIDDLE DISTRICT OF GEORGIA
MACON DIVISION
GENEVA L. WATKINS,
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Plaintiff,
v.
CAPITAL CITY BANK and L.P. KEEN
INSURANCE AGENCY, INC.,
Defendants.
CIVIL ACTION NO. 5:14-CV-107 (MTT)
ORDER
Defendant Capital City Bank (“the Bank”) has moved for sanctions pursuant to
Fed. R. Civ. P. 11 against Plaintiff Geneva Watkins, seeking an order awarding
attorney’s fees and enjoining the Watkins family and their corporations from re-litigating
their claim regarding force-placed insurance, requiring all of their future pleadings to be
accompanied by an affidavit attesting that the claims are novel, and directing them to
seek leave of court before filing against the Bank again. (Doc. 70). For the following
reasons, the motion is GRANTED in part.
I. BACKGROUND
The facts have been addressed at length in the Court’s Order granting summary
judgment to the Bank. (Doc. 86). Essentially, Geneva, her husband Robert Watkins,
their daughter Samantha Watkins, and two corporations they own, Doge, Inc. and
Mathews, Wilson, & Mathews, Inc., have filed a series of lawsuits against the Bank
since 2004. Several of these suits include claims about fraudulent force-placed
insurance.1 They have not prevailed in any of these cases. (Docs. 55-15; 55-23; 77 at
29-45).
Procedural History
Geneva and Doge, Inc. originally filed this suit in Gwinnett State Court in 2006.
(Doc. 55-1 at 3-7). On August 4, 2008, the state court denied the Bank’s motion for
summary judgment on the force-placed insurance claim. (Doc. 22-2 at 2-4). Not long
before that, Robert filed suit against the Bank in this Court, asserting claims involving
force-placed insurance. (Doc. 55-14). Doge, Inc. raised similar claims in a suit against
the Bank filed in Bibb Superior Court in August 2009. (Doc. 55-22). Because the two
state court cases involved “the same or similar issues,” the Gwinnett County case was
stayed pending the resolution of the Bibb County case and the federal case. (Doc. 24-3
at 4). After this Court, Judge Royal presiding, ruled that Robert’s fraudulent
force-placed insurance claim was barred by the statute of limitations and Bibb Superior
Court ruled that Doge, Inc.’s claim was barred for the same reason, the Bank moved to
lift the stay and renewed its motion for summary judgment, citing res judicata. (Docs.
24-3; 55-15; 55-23). Geneva voluntarily dismissed the Gwinnett County suit on the eve
of a hearing on the renewed motion for summary judgment. (Docs. 22-2 at 6; 67 at
12:5-9, 15:4-7). She re-filed in this court on March 10, 2014. (Doc. 1).
As discussed in this Court’s Order granting summary judgment to the Bank, the
undisputed facts established that Robert is the driving force behind the Watkins family
1
As far as the Court can tell, the prior lawsuits about force-placed insurance include: Geneva L. Watkins
and Doge, Inc. v. Farmers & Merchants Bank, et al., CV-06C-10783-4 (State Ct. of Gwinnett Cty.); Robert
L. Watkins v. Farmers & Merchants Bank, Capital City Bank as successor in interest to Farmers &
Merchants Banks, and L.P. Keen Ins. Agency, 5:08-CV-259 (M.D. Ga.); Doge, Inc. v. Capital City Bank as
successor in interest to Farmers & Merchants Bank, CV-09-51378 (Sup. Ct. of Bibb Cty.); Mathews,
Wilson & Mathews, Inc. v. Farmers & Merchants Bank, et al., CV-08-49310 (Sup. Ct. of Bibb Cty.);
Mathews, Wilson & Mathews, Inc. v. Farmers & Merchants Bank, et al., CV-09-51360 (Sup. Ct. of Bibb
Cty.).
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litigation, regardless of the named plaintiff in these cases. (Doc. 86 at 11 & n.11). At
the motion hearing, counsel for Geneva confirmed this, telling the Court, “[Y]ou can’t
stop Robert. You can’t really even control him.” (Doc. 99 at 6:7-8). Specifically, with
regard to the force-placed insurance claim, it is clear that it is a single claim that has
been asserted again and again by different family members or companies. Since the
Order granting summary judgment was entered, Robert has filed two pro se motions in
this case despite not being a party, one of which admits that the family’s force-placed
insurance claim has been litigated before. (Docs. 90, 91).
II. DISCUSSION
When an attorney or pro se party files a motion or pleading, he or she certifies to
the Court that, to the best of his or her knowledge and after reasonable inquiry,
(1) it is not being presented for any improper purpose, such as to harass,
cause unnecessary delay, or needlessly increase the cost of litigation;
(2) the claims, defenses, and other legal contentions are warranted by
existing law or by a nonfrivolous argument for extending, modifying, or
reversing existing law or for establishing new law; [and]
(3) the factual contentions have evidentiary support or, if specifically so
identified, will likely have evidentiary support after a reasonable
opportunity for further investigation or discovery ….
Fed. R. Civ. P. 11(b)(1)-(3). “‘Rule 11 applies to pro se plaintiffs, but the court must
take into account the plaintiff's pro se status when determining whether the filing was
reasonable.’”2 Meidinger v. Healthcare Indus. Oligopoly, 391 F. App'x 777, 778 (11th
Cir. 2010) (quoting Thomas v. Evans, 880 F.2d 1235, 1240 (11th Cir. 1989)).
2
Geneva was pro se when she renewed her complaint in this Court. (Doc. 1). She had counsel when
the motion for sanctions was filed and at the motion hearing, but the Bank is not seeking sanctions
against him. (Doc. 99 at 25:15-22). Her attorney has since withdrawn. (Docs. 101, 112). Geneva has
filed three pro se motions since the motion hearing. (Docs. 96, 100, 106).
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“The objective standard for testing conduct under Rule 11 is reasonableness
under the circumstances and what was reasonable to believe at the time the pleading
was submitted.” Baker v. Alderman, 158 F.3d 516, 524 (11th Cir. 1998) (internal
quotation marks and footnote omitted). There is a two-step inquiry: “(1) whether the
party's claims are objectively frivolous; and (2) whether the person who signed the
pleadings should have been aware that they were frivolous.” Id. If there is a violation,
the Court may impose sanctions. Fed. R. Civ. P. 11(c)(1). The purpose of Rule 11
sanctions is “to deter repetition of the conduct or comparable conduct by others similarly
situated.” Fed. R. Civ. P. 11(c)(4).
The Bank argues that the Watkins family and their corporations are subject to
sanctions because they have filed at least nineteen cases stemming from one
foreclosure and were warned by both Judge Dudley H. Bowen, Jr. in the Southern
District of Georgia and this Court that their conduct may warrant sanctions.3 (Doc. 70 at
1, 2). The Bank contends that the “repetitive lawsuits” have impaired this Court’s ability
to carry out its duties. (Id. at 5-6). Furthermore, these suits “routinely force [the] Bank
to interrupt its business affairs to address needless litigation.” (Id. at 6). The Bank
points out that it has spent hundreds of thousands of dollars defending these suits.
(Id.).
3
Judge Bowen issued an order on October 20, 2014 warning the Watkins family and their corporations
that “continuing their pursuit of frivolous litigation may result in sanctions, injunction, and/or other
appropriate relief.” (Doc. 70 at 2 (quoting Order at 4, Samantha Watkins v. Capital City Bank, No.
3:14-CV-39 (S.D. Ga. Oct. 20, 2014), Doc. 21)). This order also contains an addendum noting their
“game plan of continuously filing meritless law suits in as many different courthouses as possible for as
long as possible” and “their litany of failed and frivolous litigation.” (Id. (quoting Order at 6, Samantha
Watkins v. Capital City Bank, No. 3:14-CV-39, Doc. 21)). This Court also advised Geneva during a status
conference that it would “seriously consider any motion for sanctions” “[i]f – and it’s a big if at this point …
the Defendants can establish what they have asserted they can establish.” (Doc. 67 at 27:17-20).
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Specifically, the Bank points to sanctionable conduct in violation of Fed. R. Civ.
P. 11(b)(1)-(3) because (1) the force-placed insurance claim was presented for an
improper purpose because the Watkins family knew about the alleged fraud by 2000 at
the latest and because the claim had already been litigated in other courts; (2) the claim
was not warranted by existing law because the statute of limitations for fraud as well as
the principles of res judicata and collateral estoppel are well-settled; and (3) there is no
evidentiary support for the factual contentions presented. (Id. at 6-7). As relief, the
Bank requests that the Court enter an order enjoining the Watkins family and their
corporations from re-litigating their claim regarding force-placed insurance, requiring all
of their future pleadings to be accompanied by an affidavit attesting that the claims are
novel, and directing them to seek leave of the court before filing against the Bank again.
(Id. at 8). It also requests an award of attorney’s fees and costs. (Id. at 10).
Geneva responds that her claim was not objectively frivolous and thus cannot be
the subject of sanctions because she had evidence she believed supported her claim
when she renewed her suit in this court. (Docs. 74 at 1, 2-3; 99 at 16:1-4). She
explains that she “possessed a Judge’s order establishing that the statute of limitations
did not begin to run until 2004 and an affidavit from a qualified expert that substantiates
every claim she made about fraudulent force-placed insurance.” (Id. at 2-3). She
argues that this case was filed in 2006 and thus is just the second filed by the family.
(Id. at 2). Finally, she says she has never been the named plaintiff in a case about
force-placed insurance against the Bank. (Id. at 2).
Geneva’s arguments fail to acknowledge the undisputed facts in this case. When
she refiled this action in this Court, the force-placed insurance claim had been at least
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twice litigated and resolved adversely to the Watkins family.4 Thus, even though the
state court had denied the Bank’s first motion for summary judgment and even if
Geneva had an expert supporting the merits of her claim, the fact remains that her claim
was barred when filed. The fact that she was not the named plaintiff in the prior
adjudications, for the reasons discussed in the Court’s Order granting summary
judgment to the Bank, is immaterial. Nor is the Court persuaded by Geneva’s argument
that she did not know the suit was frivolous because “the narrative that she understands
is a narrative that is filtered through Robert” and that she is just an “unwitting
passenger” who does what Robert tells her to do. (Doc. 99 at 6:10-11, 13:25, 14:6-7).
That she allows herself to be influenced by Robert does not absolve her of her Rule 11
responsibilities. In any event, the Bank’s Rule 11 notice informed her that her claims
had been previously litigated and thus were barred by res judicata and collateral
estoppel. (Doc. 70-1 at 5-6). Finally, the family’s broader litigation history supports
sanctions. All their claims against the Bank have been rejected again and again yet
they continue to file cases litigating the same issues. Accordingly, sanctions for the
violation of Rule 11 are appropriate.
4
Neither now nor in response to the Bank’s motion for summary judgment did Geneva argue that res
judicata and collateral estoppel were inapplicable because this case was a renewal of her Gwinnett
County case which was filed prior to the other cases litigating the forced-placed insurance claim. This is
understandable because that argument would be without merit. A second-filed action that goes to
judgment can bar a first-filed action that has not yet gone to judgment. See Princess Lida of Thurn and
Taxis v. Thompson, 305 U.S. 456, 466 (1939) (“[I]t is settled that where the judgment sought is strictly in
personam, both the state court and the federal court, having concurrent jurisdiction, may proceed with the
litigation at least until judgment is obtained in one of them which may be set up as res judicata in the
other.”); Lawrence v. Household Bank (SB), N.A., 505 F. Supp. 2d 1279, 1284 (M.D. Ala. 2007) (“[I]f …
the second-filed case proceeds to judgment first, the first-filed rule must yield to the principles of res
judicata ….” (citing Chicago, R.I. & P. Ry. Co. v. Schendel, 270 U.S. 611, 615-16 (1926) and A.F. Pylant,
Inc. v. Republic Creosoting Co., 285 F.2d 840 (5th Cir. 1961)); Mut. Serv. Cas. Ins. Co. v. Frit Indus., Inc.,
805 F. Supp. 919, 922 (M.D. Ala. 1992) (“[O]nce one court reaches a judgment in a matter, that judgment
may be pled as res judicata in the other.”). Indeed, it seems clear that Geneva dismissed the Gwinnett
County action to avoid the res judicata effect of the judgments adversely resolving the forced-placed
insurance claim.
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A.
Attorney’s fees
To determine a reasonable amount of attorney's fees, “the number of hours
reasonably expended on the litigation [is] multiplied by a reasonable hourly rate.... The
product of these two figures is the lodestar and there is a strong presumption that the
lodestar is the reasonable sum the attorneys deserve.” Bivens v. Wrap It Up, Inc., 548
F.3d 1348, 1350 (11th Cir. 2008) (internal quotation marks and citation omitted). “A
reasonable hourly rate is the prevailing market rate in the relevant legal community for
similar services by lawyers of reasonably comparable skills, experience, and
reputation.” Norman v. Hous. Auth. of City of Montgomery, 836 F.2d 1292, 1396 (11th
Cir. 1988). The court may also make an award based on its own experience. Id. at
1303.
To support the request for attorney's fees and expenses, the Bank submitted an
affidavit with supporting documents demonstrating that counsel spent 134.6 hours on
this matter, resulting in attorney's fees of $19,206.50.5 (Docs. 70-1, ¶ 4; 92-1, ¶ 5;
92-2). An additional $281.82 in expenses also accrued. (Doc. 70-1, ¶ 4). Geneva has
not contested the amount of fees and expenses or the number of hours spent on this
case.
After careful review and based on the Court's own experience, the Court is
satisfied that counsel expended a reasonable number of hours at hourly rates that are
reasonable for this type of litigation in this legal community. Accordingly, the Bank is
entitled to attorney's fees and expenses totaling $19,488.32.
5
The exhibit showing the breakdown of billable hours shows a total “value” of $19,500.50. (Doc. 92-2 at
16). However, two of the line items are listed as “No Charge,” so the Court has deducted $120 from the
total to account for them. (Id. at 12-13). The Court has also deducted $174 for four line items relating to
work done regarding settlement demands received from Ms. Deborah Wilson and Charles and Carroll
Campbell. (Id. at 10-11). It is unclear how these line items relate to this litigation.
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B.
Injunction
The Bank has also requested as a non-monetary sanction an injunction that
would require any member of the Watkins family or their corporations to seek leave of
court before filing another suit against the Bank, enjoining the Watkins family and their
corporations from re-litigating their claim regarding force-placed insurance, and
requiring all of their future pleadings to be accompanied by an affidavit attesting that the
claims are novel. (Doc. 70 at 8). Federal district courts are empowered to enter an
injunction restricting a party’s ability to file suits pursuant to the All Writs Act, 28 U.S.C.
§ 1651, which authorizes federal district courts to “issue all writs necessary or
appropriate in aid of their respective jurisdictions.” 28 U.S.C. § 1651(a). “The court's
power to protect its jurisdiction includes the power to enjoin a dissatisfied party bent on
re-litigating claims that were (or could have been) previously litigated before the court
from filing in both judicial and nonjudicial forums, as long as the injunction does not
completely foreclose a litigant from any access to the courts.” Riccard v. Prudential Ins.
Co., 307 F.3d 1277, 1295 n.15 (11th Cir. 2002); see also Miller v. Donald, 541 F.3d
1091, 1096 (11th Cir. 2008) (“[T]he district courts are authorized by the All Writs Act, 28
U.S.C. § 1651(a), to restrict access to vexatious and abusive litigants.”). For example,
the Eleventh Circuit has upheld an injunction requiring a frequent litigant to obtain leave
of court before being allowed to file any new actions against his former employer,
Riccard, 307 F.3d at 1295; an injunction directing the clerk to mark any papers
submitted by a frequent litigant as “received” and requiring the approval of a judge
before filing them, Copeland v. Green, 949 F.2d 390, 391 (11th Cir. 1991) (per curiam);
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and an injunction requiring prefiling screening by a judge of all pleadings submitted by a
frequent litigant, Cofield v. Ala. Pub. Serv. Comm'n, 936 F.2d 512, 518 (11th Cir. 1991).
An injunction issued by a federal court may also bar a party from re-litigating a
claim in state court. See, e.g., Riccard, 307 F.3d at 1295 & n.15 (upholding an
injunction issued pursuant to the All Writs Act prohibiting the re-litigation of a claim in
both federal and state court without leave of court); see also Newby v. Enron Corp., 302
F.3d 295, 301 (5th Cir. 2002) (“[I]t is widely accepted that federal courts possess power
under the All Writs Act to issue narrowly tailored orders enjoining repeatedly vexatious
litigants from filing future state court actions without permission from the court.”).
The Court does not lightly impose such pre-filing requirements–it is an
extraordinary sanction. However, extraordinary circumstances are present here.
Multiple suits have been filed about fraudulent force-placed insurance by members of
the Watkins family and their corporations. As the Court pointed out in its Order granting
summary judgment to the Bank, the plaintiff changes from suit to suit, but the claim
remains the same. (Doc. 86 at 11 & n.11). Not only are such serial lawsuits
inconvenient, harassing, and expensive for the Bank, but they divert judicial resources
away from good-faith litigants and meritorious cases, delaying resolution of those
matters so the Watkins family’s claim may be resolved yet again. See Procup v.
Strickland, 792 F.2d 1069, 1072 (11th Cir.1986) (en banc ) (“Every lawsuit filed, no
matter how frivolous or repetitious, requires the investment of court time, whether the
complaint is reviewed initially by a law clerk, a staff attorney, a magistrate, or the
judge.”).
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The Watkins family’s past conduct suggests that they intend to continue suing
the Bank, no matter how many adverse judgments they receive. Under the
circumstances, decisive action is needed to safeguard the proper and efficient
functioning of the judicial system. See Miller, 541 F.3d at 1096 (“Conditions and
restrictions on each person's access are necessary to preserve the judicial resource for
all other persons.”); Procup, 792 F.2d at 1073-74 (recognizing that courts bear
“responsibility to prevent single litigants from unnecessarily encroaching on the judicial
machinery needed by others”).
The Bank has requested an injunction against the entire Watkins family and their
corporations that would require them to seek leave of Court before filing any new
lawsuit against the Bank, enjoining them from re-litigating their claim regarding
force-placed insurance, and requiring all of their future pleadings to be accompanied by
an affidavit attesting that the claims are novel. While the Court agrees that an injunction
is appropriate, it declines to issue such a broad injunction that goes far beyond the
bounds of this case. See Riccard, 307 F.3d at 1295 (“A sanction imposed for a violation
of Rule 11 must be ‘limited to what is sufficient to deter repetition of such conduct or
comparable conduct by others similarly situated.’” (quoting Fed. R. Civ. P. 11(c)(4))).
Instead, the Court ORDERS:
Geneva and those acting in concert with her are ENJOINED from filing against
the Bank any lawsuit, action, proceeding, or matter asserting claims arising from
allegedly fraudulent force-placed insurance without first seeking leave of the
court in which the suit is to be filed;
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In seeking such leave, Geneva, or anyone acting in concert with her, shall
provide the court with a copy of this Order and the Order granting summary
judgment (Doc. 86) so that the court may determine if the lawsuit, action,
proceeding, or matter is barred by res judicata or collateral estoppel;
Attorney’s fees are awarded in the amount of $19,488.32.
SO ORDERED, this 11th day of April, 2016.
S/ Marc T. Treadwell
MARC T. TREADWELL
UNITED STATES DISTRICT COURT
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