Egana et al v. Blair's Bail Bonds, Inc. et al
Filing
245
ORDER AND REASONS: For the foregoing reasons, the 183 Motion for Sanctions, 197 Motion to Strike, and 202 Amended Motion for Sanctions are DENIED. Signed by Judge Jane Triche Milazzo on May 13, 2019. (mp)
UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF LOUISIANA
RONALD EGANA ET AL.
CIVIL ACTION
VERSUS
NO: 17-5899
BLAIR’S BAIL BONDS INC. ET AL.
SECTION “H”
ORDER AND REASONS
Before the Court are Bankers Insurance Company, Inc. and Bankers
Surety Services, Inc.’s Motion for Sanctions (Doc. 183); Amended Motion for
Sanctions (Doc. 202); and Motion to Strike (Doc. 197). For the following
reasons, the Motions are DENIED.
BACKGROUND
The facts of this case have been detailed in prior orders and need not be
repeated here. On December 10, 2018, Plaintiffs were granted leave to file a
Third Amended Complaint (“TAC”). The TAC removed many of the allegations
brought under RICO and other tort theories that Plaintiffs had previously set
forth against Defendants Bankers Insurance Company, Inc. and Bankers
Surety Services, Inc. (the “Bankers Defendants”). The TAC retained only a
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state law contract claim against the Bankers Defendants. Despite this,
however, the TAC and the Third Amended RICO Case Statement (“RICO
Statement”) also retained many of the factual allegations previously asserted
against the Bankers Defendants. Specifically, they continue to allege that the
Bankers Defendants are participants in a RICO enterprise that is allegedly
engaged in kidnapping, extortion, extortionate collection of an unlawful debt,
and false imprisonment. Plaintiffs reassert the allegation that certain
employees of Blair’s Bail Bonds, Inc. and New Orleans Bail Bonds, LLC
(collectively, “Blair’s”) invoked the Bankers Defendants as the decisionmakers
when demanding payment, requiring the use of ankle monitors, and
threatening surrender. The Bankers Defendants argue that Plaintiffs now
know that these statements are untrue and that the Bankers Defendants had
no involvement in these decisions. They therefore argue that Plaintiffs should
not be permitted to continue to assert these allegations.
The Bankers Defendants have moved to strike several portions of the
TAC and RICO Statement that include allegations against them. Further, they
have moved for sanctions against Plaintiffs for continuing to assert these
allegations. This Court will consider these requests in turn.
LAW AND ANALYSIS
A. Motion to Strike
The Bankers Defendants object to Plaintiffs’ allegations about their role
in the RICO enterprise and statements made by Blair’s employees about the
Bankers Defendants. They argue that the basis of Plaintiffs’ claims against
them has always been statements made by Blair’s employees regarding
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directions that they received from the Bankers Defendants on how to handle
particular bond agreements or the collection of certain debts. The Bankers
Defendants argue that because Plaintiffs have admitted that these statements
were untrue, they should not be permitted to continue to rely on them to lodge
allegations against the Bankers Defendants. Indeed, Plaintiffs have admitted
that the Bankers Defendants were not involved in decisions to require
defendants to wear ankle monitors, to establish installment plans for the
payment of bond premiums, or to surrender defendants to jail when they failed
to make payments. The Bankers Defendants argue that despite this Plaintiffs
continue to make conclusory allegations that Bankers is a participant in a
RICO enterprise. The Bankers Defendants argue that these allegations in the
TAC and RICO Statement should be stricken because (1) they have no basis in
fact and (2) are scandalous.
Federal Rule of Civil Procedure 12(f) permits a district court to “strike
from a pleading an insufficient defense or any redundant, immaterial,
impertinent, or scandalous matter.” A motion to strike under Rule 12(f) is a
“drastic remedy” that should be used sparingly. 1 Thus, “even when technically
appropriate and well-founded,” a motion to strike should not be granted unless
the moving party demonstrates prejudice. 2 Whether to grant a motion to strike
is committed to the trial court’s sound discretion. 3 “Any doubt about whether
See Augustus v. Bd. of Pub. Instruction of Escambia Cnty., Fla., 306 F.2d 862, 868
(5th Cir. 1962).
2 Abene v. Jaybar, LLC, 802 F.Supp.2d 716, 723 (E.D.La. 2011) (internal quotation
marks omitted); Diesel Specialists, LLC v. Mohawk Traveler M/V, Nos. 09–2843, 11–1162,
2011 WL 4063350, at *1 (E.D.La. Sept. 13, 2011).
3 Who Dat, Inc. v. Rouse’s Enters., LLC, No. 12–2189, 2013 WL 395477, at *2 (E.D.La.
Jan. 31, 2013).
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the challenged material is redundant, immaterial, impertinent, or scandalous
should be resolved in favor of the non-moving party.” 4
At the outset, the Bankers Defendants do not point to any law or case
from this Circuit suggesting that the allegations of a complaint should be
stricken for being untrue. 5 “A motion to strike particular defenses or
allegations from a pleading as ‘sham’ or ‘false’ is not authorized specifically in
Rule 12(f).” 6 In addition, while the statements relied upon by Plaintiffs may be
untrue, the statements were actually made. These statements are relevant to
the Plaintiffs’ claims against Blair’s as evidence of Blair’s practice of coercing
payments from clients.
Further, the Bankers Defendants have not shown that the allegations of
the TAC and RICO Statement are scandalous such that striking them is
appropriate. “‘[S]candalous’ matter improperly casts a derogatory light on
someone, most typically on a party to the action[,] but it is not enough that the
matter offends the sensibilities of the objecting party or the person who is the
subject of the statements in the pleading, if the challenged allegations describe
acts or events that are relevant to the action.” 7 “The motion to strike should be
granted only when the pleading to be stricken has no possible relation to the
Guidry v. Louisiana Lightning, LLC, No. 15-6714, 2016 WL 3127256, at *6 (E.D. La.
June 3, 2016.
5 Rule 11 no longer contains a provision for striking pleadings as sham or false. “The
passage has rarely been utilized, and decisions thereunder have tended to confuse the issue
of attorney honesty with the merits of the action.” FED. R. CIV. PRO. 11 (Committee Notes
1983 Amendment).
6 §5C CHARLES ALAN WRIGHT & ARTHUR R. MILLER, FEDERAL PRACTICE AND
PROCEDURE § 1383 (3d ed. 2004).
7 Guidry, 2016 WL 3127256, at *6 (internal quotations omitted) (quoting 5C CHARLES
ALAN WRIGHT & ARTHUR R. MILLER, FEDERAL PRACTICE AND PROCEDURE § 1382 (3d ed.
2004)).
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controversy.” 8 The allegations against the Bankers Defendants are relevant
not only to Plaintiffs’ RICO claims against Blair’s but also to their remaining
claims against the Bankers Defendants. “These allegations detail the goals and
structure of the enterprise and also describe Blair’s extortionate conduct and
use of the enterprise—including Bankers’ role as insurance company on the
bonds—as a vehicle through which unlawful . . . activity is committed.” 9
Finally, the Bankers Defendants have not identified any way in which
the allegations of the TAC and RICO Statement have caused them prejudice.
Indeed, Plaintiffs have withdrawn all RICO and tort claims against the
Bankers Defendants. Accordingly, the Bankers Defendants’ Motion to Strike
is denied.
B. Motion for Sanctions
The Bankers Defendants next seek sanctions from Plaintiffs pursuant to
28 U.S.C. § 1927 and the Court’s inherent power. The Bankers Defendants
filed a Motion for Sanctions and an Amended Motion for Sanctions arguing
that Plaintiffs should be sanctioned for continuing to assert admittedly false
allegations against the Bankers Defendants and for failing to validate the facts
of their Complaint prior to bringing a RICO claim against them.
Section 1927 states, “Any attorney or other person admitted to conduct
cases in any court of the United States or any Territory thereof who so
multiplies the proceedings in any case unreasonably and vexatiously may be
required by the court to satisfy personally the excess costs, expenses, and
attorneys’ fees reasonably incurred because of such conduct.” “Section 1927
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Augustus, 306 F.2d at 868.
Doc. 204, p. 14.
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sanctions are not to be awarded lightly. They require evidence of bad faith,
improper motive, or reckless disregard of the duty owed to the court.” 10 In
addition, “[f]ederal courts have the inherent power to assess sanctions under
certain circumstances, such as when a party has acted in bad faith,
vexatiously, wantonly, or for oppressive reasons, or has defiled the very temple
of justice.” 11 “In order to impose sanctions against an attorney under its
inherent power, a court must make a specific finding that the attorney acted
in bad faith.” 12
Accordingly, to succeed on its request for sanctions under either theory,
the Bankers Defendants must show that Plaintiffs acted in bad faith. They
contend that “Plaintiffs and their counsel acted in bad faith in filing and then
maintaining ‘patently frivolous’ claims against Bankers prior to conducting
any reasonable investigation. Plaintiffs’ Sanctionable Claims were never based
on any cognizable evidence, and became contradicted by the evidence Plaintiffs
discovered early and often in this lawsuit.” 13 This Court does not find that
Plaintiffs actions in this case rise to the level of bad faith. Plaintiffs have shown
that they reasonably investigated their claims, used discovery to confirm those
allegations, and dismissed claims when discovery showed that the claims may
no longer be viable. Plaintiffs brought a RICO claim on the basis of statements
made by Blair’s employees regarding the involvement of the Bankers
Defendants in the bonding process. The fact that these statements were later
Gonzalez v. Fresenius Med. Care N. Am., 689 F.3d 470, 479 (5th Cir. 2012) (internal
quotations omitted).
11 Matter of Dallas Roadster, Ltd., 846 F.3d 112, 134 (5th Cir. 2017) (internal
quotations omitted).
12 Sandifer v. Gusman, 637 F. App’x 117, 121 (5th Cir. 2015).
13 Doc. 183-1, p.9.
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revealed through discovery to be false does not render the claims brought in
bad faith. Accordingly, sanctions are not appropriate.
CONCLUSION
For the foregoing reasons, the Motions are DENIED.
New Orleans, Louisiana this 13th day of May, 2019.
____________________________________
JANE TRICHE MILAZZO
UNITED STATES DISTRICT JUDGE
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