TANNER v. JPMORGAN CHASE BANK USA NA
ORDER for sanctions against Jonathan W. Birdt. Ordered by US DISTRICT JUDGE LESLIE J ABRAMS on 02/04/2016. (mdm)
IN THE UNITED STATES DISTRICT COURT
FOR THE MIDDLE DISTRICT OF GEORGIA
BANK USA, N.A.,
CASE NO.: 5:15-CV-9 (LJA)
Before the Court is Jonathan W. Birdt’s Response to the Court’s Order to Show
Cause why he should not be sanctioned for the unauthorized practice of law and for
violating Federal Rule of Civil Procedure 11(b). For the reasons that follow, the Court finds
that Mr. Birdt has failed to show cause and that sanctions are warranted.
Plaintiff Corey Tanner commenced the above-captioned matter on January 9, 2015,
alleging violations of the Telephone Consumer Protection Act. (Doc. 1.) On March 18,
2015, the Court granted Plaintiff’s Notice of Voluntary Dismissal. (Doc. 7.) Following the
Court’s Order, on May 12, 2015, non-party National Consumer Advocates, Inc. (“NCAI”)
served Plaintiff’s attorney – but not Plaintiff – with a Notice of Lien (the “Notice”). (Doc.
8.) Prior to serving the Notice, however, NCAI had not participated in this action in any
way; nor did any NCAI attorney file a notice of appearance on behalf of NCAI.1
The Notice stated “that NCAI asserts a lien on any recovery in this action pursuant
to its’ written agreement with Plaintiff in the amount of $16,825.44.” (Doc. 8.) It did not,
however, state the basis for asserting the lien or attach any agreement; nor did it contain a
In fact, the Notice was facially deficient as it incorrectly identified “Navient Solutions, Inc.” as the
Defendant. (Doc. 8.)
legible signature or state the name, address, email address, or telephone number of the
individual representing NCAI. Recognizing these deficiencies, Plaintiff moved to strike the
Notice. (Doc. 9.) Like the Notice, NCAI’s response to Plaintiff’s Motion to Strike (the
“Response”) did not contain a legible signature or state the name, address, email address, or
telephone number of the individual representing NCAI. (Doc. 10.) Instead, it simply
contained an indecipherable signature, which appeared to be the same signature on the
Notice and Response, indicating it was signed by “NCAI, Lien Claimant.” (Id.)
On August 14, 2015, the Court granted Plaintiff’s Motion to Strike, finding that
NCAI failed to produce any judgment against Plaintiff or provide any authority under
federal or Georgia law for filing a pre-judgment lien in this action. (Doc. 12.) The Court
further found that the Notice of Lien violated Federal Rule of Civil Procedure 11(a) because
it failed to include a legible signature, address, email address, or telephone number of the
individual representing NCAI.2 Therefore, the Court struck NCAI’s Notice of Lien.
As of the date of the Court’s order, five district courts had struck or otherwise
dismissed similar liens filed by NCAI. On May 29, 2015, the United States District Court for
the District of Colorado struck NCAI’s notice of lien, finding that it violated Federal Rule of
Civil Procedure 11(a). Gehring v. Sallie Mae, Inc., No. 1:14-CV-490, Minute Order (Doc. 21),
(D. Colo. May 29, 2015). On June, 2, 2015, the United States District Court for the Norther
District of New York dismissed NCAI’s notice of lien, finding that it failed to state a
sufficient basis for asserting a lien and was not personally served on plaintiff. DiSatasi. v.
Navient Solutions, Inc., No. 1:15-CV-38, Text Order (Doc. 16), (N.D.N.Y. June 2, 2015). On
June 3, 2015, the United States District Court for the Western District of Pennsylvania
granted plaintiff’s motion to strike without stating a reason and noting that the dismissal was
with the consent of counsel of NCAI. See Macey v. Sallie Mae, Inc., No. 2:14-CV-312, Order
(Doc. 16), (W.D. Pa. June 3, 2015). On June 1, 2015, the United States District Court for the
Northern District of Georgia granted plaintiff’s motion to strike following NCAI’s failure to
respond to the motion. See Sidders v. Elan Fin. Grp. LLC, No. 1:14-CV-3094, Order (Doc.
Federal Rule of Civil Procedure 11(a) provides that “[e]very pleading, written motion, and other paper must
be signed by at least one attorney of record in the attorney’s name – or by a party personally if the party is
unrepresented. The paper must state the signer’s address, e-mail address, and telephone number.” Fed. R.
Civ. P. 11(a).
37), (N.D. Ga. June 1, 2015). Likewise, on June 8, 2015, the United States District Court for
the Central District of California granted plaintiff’s motion to strike after NCAI failed to
respond to the motion. See Cleaves v. Sallie Mae, Inc., No. 8:14-CV-1029, Order (Doc. 22),
(C.D. Cal. June 8, 2015). On November 6, 2015, the Western District of Pennsylvania
granted the plaintiff’s motion to strike, holding that it could not “discern any legal basis that
supports NCAI’s filing of the notice of lien in this case.” Swartzbeck v. Navient Solutions, Inc.,
No. 2:14-CV-746, Order (Doc. 15), (W.D. Pa. Nov. 2, 2015). Courts in the Southern District
of Georgia and the District of Maryland have yet to rule on the plaintiffs’ motions to strike
similar liens filed by NCAI. See Timmerman v. Navient Solutions, Inc., No. 1:14-CV-224 (S.D.
Ga.); Guardado v. Navient Solutions, Inc., No. 8:15-CV-955 (D. Ma.).
Here, as in the cases cited above, the individual signing on behalf of NCAI was not
identified. This Court reviewed the exhibits in this matter and determined that Jonathan W.
Birdt is the attorney who signed the Notice and Response on behalf of NCAI. Mr. Birdt is a
California lawyer currently representing NCAI against the law firm of Plaintiff’s counsel in a
breach of contract action pending in the Superior Court of California. As an exhibit to the
Response, Mr. Birdt attached the complaint filed in that action (the “California Complaint”).
The California Complaint clearly lists Mr. Birdt as NCAI’s attorney and bears Mr. Birdt’s
signature. The signature on the California Complaint (Doc. 10.4) and the signatures on the
Notice (Doc. 8) and Response (Doc. 10) are the same. (See also Doc. 15.) Further review
establishes that Mr. Birdt was the signatory on all three documents in this case, as well as on
the numerous other liens NCAI filed across the country.
After concluding that Mr. Birdt was the signatory on the Notice and Response, the
Court determined that Mr. Birdt had not filed a notice of appearance in this case and that,
based on a “member search” on the website of the State Bar of Georgia, he was not licensed
to practice law in this jurisdiction. As such, the Court ordered Mr. Birdt to show cause why
he should not be sanctioned for the unauthorized practice of law. (Doc. 12.) In addition,
because Mr. Birdt did not set forth any basis or cite any law for asserting a pre-judgment lien
in this case, the Court ordered him to show cause why he should not be sanctioned under
Rule 11(b). (Id.)
On October 19, 2015, Mr. Birdt responded to the Court’s Order, stating that it was
unclear why he was implicated in this matter other than the fact that he was the attorney of
record in the California action. (See Doc. 15.) Mr. Birdt concedes that he is not admitted to
practice law in Georgia and that he did not file a notice of appearance in this case.
Nevertheless, Mr. Birdt maintains that he is “unaware of the basis” for the Court’s Order.
(Id. at 2.) Mr. Birdt made no attempt to explain why or how his signature came to be present
on the Notice or the Response. Mr. Birdt also offered no authority to support the imposition
of a prejudgment lien in this case. Lastly, although the Court provided Mr. Birdt with the
opportunity to request a hearing, Mr. Birdt made no such request.
Unauthorized Practice of Law
“Courts have the inherent authority to control the proceedings before them, which
includes the authority to impose reasonable and appropriate sanctions.” Martin v. Automobili
Lamborghini Exclusive, Inc., 307 F.3d 1332, 1335 (11th Cir. 2002) (internal quotation marks
omitted). “This means, among other things, ‘that a federal court has the power to control
admission to its bar and to discipline attorneys,’” Thomas v. Tenneco Packaging Co., 293 F.3d
1306, 1320 (11th Cir. 2002) (quoting Chambers v. NASCO, Inc., 501 U.S. 32, 43 (1991)). With
this power, courts also have the ability to sanction conduct amounting to the unauthorized
practice of law. See United States v. Johnson, 327 F.3d 554, 560 (7th Cir. 2003) (“It follows
logically that a federal court’s power to regulate and discipline attorneys appearing before it
extends to conduct by nonlawyers amounting to practicing law without a license.”). Indeed,
“considering the serious threat that the unauthorized practice of law poses both to the
integrity of the legal profession and to the effective administration of justice, resort to the
inherent powers . . . is an appropriate remedial measure.” Id. Further, the Court’s “‘inherent
power to sanction errant lawyers . . . ‘can be invoked even if procedural rules exist which
sanction the same conduct.’” Thomas, 293 F.3d at 1320 (quoting Chambers, 501 U.S. at 49).
“Due to the scope of the inherent powers vested in federal courts, however, it is
necessary that such courts ‘exercise caution in invoking [their] inherent power.’” Id. (quoting
Chambers, 501 U.S. at 50). Thus, to impose sanctions against a lawyer pursuant to its inherent
powers, a court “must find that the lawyer’s conduct ‘constituted or was tantamount to bad
faith.’” Id. (quoting Durrett v. Jenkins Brickyard, Inc., 678 F.2d 911, 918 (11th Cir. 1982)). Bad
faith exists where a party or attorney knowingly or recklessly raises a frivolous argument,
delays or disrupts the litigation, or hampers the enforcement of a court order. Thomas, 293
F.3d at 1320.
Applying this framework, the Court finds that sanctions are warranted against Mr.
Birdt for the unauthorized practice of law. As noted above, a simple comparison of Mr.
Birdt’s signature on the California Complaint and the signatures on the Notice and Response
clearly demonstrates that Mr. Birdt signed all three documents. Although he contends that
he is unaware of this case or any of the filings, he offers no explanation for why or how his
signature is on the Notice or the Response. Instead, he simply states that he is not able to
respond to “the motive or actions of NCAI in this action,” implying that NCAI filed the
documents directly. (Doc. 15 at 2.)
Contrary to Mr. Birdt’s apparent argument that the Notice and Response were filed
directly by NCAI, it “is well established that a corporation is an artificial entity that can act
only through agents, cannot appear pro se, and must be represented by counsel.” Palazzo v.
Gulf Oil Corp., 764 F.2d 1381, 1385 (11th Cir. 1985). “This rule reflects the ancient common
law tradition that a corporation can only appear in court by an attorney.” PBS&J Constructors,
Inc. v. I.L. Fleming, Inc., No. 11-CV-1785, 2015 WL 7779214, at *1 (N.D. Ga. Dec. 2, 2015)
(quotations and citation omitted). Thus, NCAI could not file the Notice and Response, but
instead was required to have an attorney do so on its behalf. Moreover, that Mr. Birdt
omitted any self-identifying information from the filings does not mean that he was not
engaged in the practice of law. To the contrary, by signing the Notice and Response, Mr.
Birdt implicated himself in this matter and engaged in the practice of law in this jurisdiction.
As Mr. Birdt concedes, he did not file a notice of appearance in this case and he is not
authorized to practice law before this Court.
To practice law in this District, an attorney must be an active member in good
standing of the State Bar of Georgia, M.D. Ga. L.R. 83.1.1(b), or be admitted pro hac vice,
M.D. Ga. L.R. 83.1.2(c). Failure to seek pro hac vice admission is a violation of this Court’s
Local Rules. Because Mr. Birdt is not admitted to practice law in Georgia and because he did
not seek pro hac vice admission, he engaged in the unauthorized practice of law when he
signed the Notice and Response. What is more, Mr. Birdt – a licensed attorney – blatantly
violated Federal Rule of Civil Procedure 11(a) by omitting his address, email address, and
telephone number from the Notice and Response. The question, then, is whether Mr. Birdt
acted in bad faith.
In the Order to Show Cause, the Court emphasized that it was “troubled by the
seemingly deceptive manner in which Mr. Birdt filed the Notice and Response –
intentionally omitting any identifying information.” (Doc. 12 at 4.) Despite the gravity of the
Court’s statement, Mr. Birdt made no attempt to explain how or why his signature came to
be on the Notice and Response. Instead, he simply denied having any knowledge of this
case. Notably, however, Mr. Birdt did not deny that the signatures on the Notice and
Response were in fact his. Given that the signatures on the Notice and Response match the
acknowledged signature of Mr. Birdt on the California Complaint and, in the absence of any
denial of this fact or any explanation, the Court finds Mr. Birdt acted in bad faith and
engaged in the unauthorized practice. Therefore, sanctions are warranted.
“Sanctions authorized under the court’s inherent powers include the striking of
frivolous pleadings or defenses, disciplining lawyers, punishing for contempt, assessment of
attorney’s fees, and outright dismissal of a lawsuit.” Allapattah Servs., Inc. v. Exxon Corp., 372
F. Supp. 2d 1344, 1373 (S.D. Fla. 2005) (collecting cases). In fashioning the appropriate
sanction, courts must exercise restraint and discretion. Chambers, 501 U.S. at 45. Recognizing
this principle, the Court finds that the appropriate sanction under the Court’s inherent
powers is to require Mr. Birdt to pay the pro hac vice admission fee of $100, and to report Mr.
Birdt to the appropriate bar associations. This sanction takes into account the seriousness of
Mr. Birdt’s conduct, while acknowledging that the various state bar associations are best
suited to determine if additional sanctions are appropriate, considering the current posture
of this case.
Rule 11 Violations
In addition to ordering Mr. Birdt to show cause why he should not be sanctioned for
the unauthorized practice of law, the Court also ordered him to show cause why he should
not be sanctioned for pursuing claims that were unwarranted by existing law in violation of
Federal Rule of Civil Procedure 11(b). Rule 11(b) sanctions are appropriate when an attorney
files a pleading, motion, or other paper that “(1) has no reasonable factual basis; (2) is based
on a legal theory that has no reasonable chance of success and that cannot be advanced as a
reasonable argument to change existing law; and (3) is filed in bad faith for an improper
purpose.” Baker v. Alderman, 158 F.3d 516, 524 (11th Cir. 1998). “Rule 11 sanctions are
designed to discourage dilatory or abusive tactics and help to streamline the litigation process
by lessening frivolous claims or defenses.” Didie v. Howes, 988 F.2d 1097, 1104 (11th Cir.
1993) (quotations and citation omitted). 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, 158 F.3d at 524 (citations omitted). The
Eleventh Circuit employs a two-step inquiry when evaluating the propriety of Rule 11
sanctions: “(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.
The Notice sought to encumber $16,825.44 out of the amount Defendant agreed to
pay Plaintiff in order to settle this matter. (Doc. 8.) The Notice cited no authority under
federal or Georgia law for asserting the lien, but instead simply stated that the lien was being
asserted pursuant to a “written agreement,” which was not attached to the Notice. (Doc. 8.)
Although the Response included the agreement, it failed to cite any authority or facts
supporting the imposition of prejudgment lien in this action. (See Doc. 10.)
It is well-settled that “in all cases in federal court, state law is incorporated to
determine the availability of prejudgment remedies for the seizure of person or property to
secure satisfaction of the judgment ultimately entered.” Mitsubishi Int’l Corp. v. Cardinal Textile
Sales, Inc., 14 F.3d 1507, 1521 (11th Cir. 1994). “In Georgia, prejudgment attachment is
subject to the same conditions as postjudgment attachment in cases making demands in
contract or in tort.” Id. These conditions are found in O.C.G.A. § 18-3-1, which states:
Attachments may issue when the debtor:
(1) Resides out of the state;
(2) Moves or is about to move his domicile outside the limits of the county;
(4) Conceals himself;
(5) Resists legal arrest; or
(6) Is causing his property to be removed beyond the limits of the state.”
O.C.G.A. § 18-3-1. Here, the Notice and Response failed to demonstrate any of the
statutory grounds for the imposition of a prejudgment lien in this action. Thus, the claim for
prejudgment attachment was obviously frivolous.
As to the second prong, Mr. Birdt knew or should have known that his claims were
frivolous at the time the Notice was filed. The standard for making this determination is
whether Mr. Birdt would have been aware that his claims were frivolous had he made a
reasonable inquiry. Worldwide Primates, Inc. v. McGreal, 87 F.3d 1252, 1254 (11th Cir. 1996). “If
the attorney failed to make a reasonable inquiry, then the court must impose sanctions
despite the attorney’s good faith belief that the claims were sound.” Id. Considering Mr.
Birdt’s utter failure to cite any facts or law supporting the imposition of a prejudgment lien
in this case, it is clear that he made no inquiry or investigation into the validity of such action
and that he should have been aware that his claim was frivolous.
In addition to knowingly filing a frivolous claim, Mr. Birdt also failed in his duty of
candor. “Every lawyer is an officer of the court and, as such, in addition to his duty of
diligently researching his client’s case, he always has a duty of candor to the tribunal.”
Bautista v. Star Cruises, 696 F. Supp. 2d 1274, 1278 (S.D. Fla. 2010) (citing Burns v. Windsor
Insurance, Co., 31 F.3d 1092, 1095 (11th Cir. 1994)). Rule 11 “emphasizes the duty of candor
by subjecting litigants to potential sanctions for insisting upon a position after it is no longer
tenable.” Turner v. Sungard Bus. Sys., Inc., 91 F.3d 1418, 1422 (11th Cir. 1996) (citing Fed. R.
Civ. P. 11 advisory committee note); see also Battles v. City of Ft. Myers, 127 F.3d 1298, 1300
(11th Cir. 1997) (“Rule 11 emphasizes an attorney’s continuing obligation to make inquiries,
and thus the rule allows sanctions when an attorney continues insisting upon a position after
it is no longer tenable.”). In light of the numerous other courts across the country that struck
down similar liens signed by Mr. Birdt, Mr. Birdt should have known, as early as May 29,
2015, that his assertion of a lien was unwarranted by existing law and defective under the
Federal Rules of Civil Procedure. Yet, Mr. Birdt never withdrew the Notice and, in fact, filed
a response opposing Plaintiff’s Motion to Strike on June 2, 2015. Mr. Birdt’s unwavering
insistence on the imposition of a lien in this action and complete failure to provide any
authority or facts to support such a position not only demonstrates a lack of diligence in
researching his client’s case, but it also exhibits his lack of candor in failing to acknowledge
the state of the law while pursuing claims in this Court. Accordingly, the Court finds that Mr.
Birdt violated Rule 11(b).
Having determined Mr. Birdt violated Rule 11(b), the Court now turns to the
question of the appropriate sanction. Under Rule 11, “the selection of the type of sanction
to be imposed lies within the district court’s sound exercise of discretion.” Donaldson v. Clark,
819 F.2d 1551, 1557 (11th Cir. 1987). “However, the court’s discretion to impose sanctions
is not unrestricted, in that the sanction ‘must be limited to what suffices to deter repetition
of the conduct or comparable conduct by others similarly situated.’” McDonald v. Emory
Healthcare Eye Ctr., 391 F. App’x 851, 853 (11th Cir. 2010) (quoting Fed. R. Civ. P. 11(c)(4)).
“Sanctions may include, for example, nonmonetary directives, such as a reprimand or
instruction to attend a legal education course, or an order to pay a fine to the court.”
Homecare CRM, LLC v. Adam Grp., Inc. of Middle Tennessee, 952 F. Supp. 2d 1373, 1385 (N.D.
Ga. 2013) (citing Fed. R. Civ. P. 11(c)(4)). In determining the appropriate sanction, the Court
considers the following factors: (1) whether Mr. Birdt’s conduct was willful, or negligent; (2)
whether the conduct was part of a pattern of activity, or an isolated event; (3) whether the
conduct infected the entire pleading, or only one particular count or defense; (4) whether
Mr. Birdt has engaged in similar conduct in other litigation; (5) whether the conduct was
intended to injure; (6) what effect the conduct had on the litigation process in time or
expense; (7) whether the responsible person is trained in the law; (8) what amount, given the
financial resources of the responsible person, is needed to deter that person from repetition
in the same case; and (9) what amount is needed to deter similar activity by other litigants.
McDonald v. Emory Healthcare Eye Ctr., 391 F. App’x 851, 853 (11th Cir. 2010).
Upon considering these factors, the Court finds that Mr. Birdt is trained in the law
and that his conduct was willful, was part of a pattern of activity, and was a waste of the
Court’s and the Plaintiff’s time and resources. As noted above, Mr. Birdt filed these frivolous
liens in numerous actions across the country, and every court to consider the liens has
dismissed them. As a licensed attorney, Mr. Birdt should have undertaken a more thorough
analysis of his client’s claims to determine the propriety of asserting a lien. Given the posture
of the case, the Court finds that the appropriate sanction against Mr. Birdt is a $500 fine to
be paid to the Court registry and an award of fees and costs to the Plaintiff. This sanction is
appropriate under the circumstances and will serve as a sufficient deterrent for similar future
conduct. See Donaldson v. Clark, 819 F.2d 1551, 1557 (11th Cir. 1987) (“Imposing a financial
penalty often will be the most effective and fair means of enforcing Rule 11 and deterring
In light of the forgoing, the Court finds that sanctions are warranted against Mr. Birdt
for the unauthorized practice of law and Rule 11(b) violations. Within thirty (30) days of
the date of this Order, Mr. Birdt shall pay the pro hac vice admission fee of $100, as well as a
fine of $500, to the registry of the Court. In addition, Mr. Birdt is ORDERED to reimburse
Plaintiff for reasonable expenses and fees that he incurred in moving to strike the Notice.
Mr. Birdt, Plaintiff and Plaintiff’s counsel are DIRECTED to resolve this issue without the
Court’s involvement. However, if the Parties are unable to reach a resolution within fortyfive (45) days of the date of this Order, Plaintiff shall file the appropriate motion and the
Court will set a hearing to determine the amount of fees and costs. Lastly, this Order will be
furnished to state bar associations where Mr. Birdt is licensed to practice, along with the
State Bar of Georgia.
SO ORDERED, this 4th day of February, 2016.
/s/ Leslie J. Abrams
LESLIE J. ABRAMS, JUDGE
UNITED STATES DISTRICT COURT
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