PERRY et al v. ALEXANDER et al

Filing 280

ORDER granting 268 Motion for Court to Deem Settlement Documents Signed and for Sanctions. By MAGISTRATE JUDGE JOHN C. NIVISON. (MFS)

UNITED STATES DISTRICT COURT
DISTRICT OF MAINE

ALAN J. PERRY, et al.,

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Plaintiffs
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v.
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PETER TINKHAM, et al.,
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Defendants
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_________________________________)
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PETER TINKHAM, et al.,
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Plaintiffs
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v.
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LAURA PERRY, et al.,
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)
Defendants
)

2:15-cv-00310-JCN

ORDER ON PLAINTIFFS’ MOTION FOR COURT TO DEEM
SETTLEMENT DOCUMENTS SIGNED AND FOR SANCTIONS
This matter is before the Court on Plaintiffs’ Motion for Court to Deem Settlement
Documents Signed and for Sanctions. (Motion, ECF No. 268.) Defendants did not file a
response to the motion.
After review of the motion and the record, the Court grants the motion.

Discussion
On May 24, 2018, the Court granted Plaintiffs’ Motion to Enforce Settlement and
for Sanctions. (Decision and Order, ECF No. 264.) 1 In the Decision and Order, the Court
ordered the parties to sign all documents necessary to implement the settlement.
Specifically, the Court ordered:
On or after May 29, 2018, Plaintiffs shall forward to Defendants, in a form
by which Defendants’ receipt of the documents can be verified, the
documents Plaintiffs believe Defendants must sign to implement the terms
of the settlement. Within 7 days of the receipt of the documents, Defendants
shall execute the documents and return the executed original documents to
Plaintiffs’ counsel.
(Decision and Order at 11-12.)
On June 13, 2018, Plaintiffs filed a Motion for Court to Deem Settlement
Documents Signed and for Sanctions, in which motion Plaintiffs ask the Court to deem the
settlement documents signed by Defendants because Defendants have failed to execute the
necessary settlement documents. (ECF No. 268.) In support of their motion, Plaintiffs
filed several exhibits by which they document their efforts to forward the settlement
documents to Plaintiffs. (ECF Nos. 268-1, 268-2, 268-3, 269-4, 268-5.) Defendants did
not file a response to the motion.
On the same date Plaintiffs filed their motion, Defendants filed a notice of appeal
from the Decision and Order. (ECF No. 271.) “[A]s a general rule, the filing of a notice
of appeal divests a district court of authority to proceed with respect to any matter touching
upon, or involved in, the appeal.” United States v. Brooks, 145 F.3d 446, 455 (1st Cir.

1

In the Decision and Order, the Court also denied Defendants’ Motion for Judicial Aid in Settlement.
2

1998) (internal quotation marks omitted). Because Plaintiffs’ Motion to Deem Settlement
Documents Signed is derivative of the substantive relief granted in the Court’s Decision
and Order, the Court deferred consideration of the motion pending the appeal.

On

September 21, 2018, the First Circuit dismissed the appeal. (Judgment, ECF No. 278.) On
October 15, 2018, the First Circuit issued its mandate. (ECF No. 279.) With the appeal
resolved, the Court will address the relief requested by Plaintiffs.
In the Decision and Order, the Court wrote:
The Court recognizes that Plaintiffs have asked the Court to deem that
Defendants have signed a release and that Defendants have signed a deed
transferring all interest in the Weld property. Because the Court has not
previously ordered the enforcement of the settlement, the Court believes it
appropriate to permit Defendants the opportunity to comply with the Court’s
order before the Court considers whether any other enforcement measures
are appropriate, including whether to deem that Defendants have signed
certain documents. In the event Defendants do not comply with the Court’s
order, Defendants are advised that further sanctions are possible and the
Court will consider Plaintiffs’ request to deem the settlement-related
documents to have been signed by Defendants. See, e.g., Farmer v. Banco
Popular of N.A., 791 F.3d 1246 (10th Cir. 2015) (upholding imposition of
sanctions for party’s failure to comply with order to perform under the terms
of a settlement agreement); Queens Syndicate Co. v. Herman, 691 F. Supp.
2d 283 (D. Mass. 2010) (ordering party to execute mutual release within 14
days and providing that release otherwise would be deemed executed by that
date); Big-D Constr. Corp. v. Take It For Granite Too, No. 2:11-cv-621,
2013 WL 4519339 (D. Nev. Aug. 23, 2013) (deeming settlement agreement
fully executed upon party’s failure to fully execute settlement documents).
(Decision and Order at 12 n.12.) Defendants, therefore, were on notice that if they did not
sign the settlement documents as ordered, the Court could deem the documents signed and
could impose additional sanctions.
Based on the record filed in support of Plaintiffs’ motion, the Court is convinced
that Defendants received the settlement documents, and, consistent with Defendants’
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repeated disregard for the Court’s prior orders, Defendants have deliberately refused to
execute the documents. The Court is also satisfied that without the relief requested by
Plaintiffs, the documents necessary to confirm and implement the parties’ settlement would
remain unsigned by Defendants. The Court, therefore, will deem the documents necessary
to implement the settlement signed by Defendants. Queens Syndicate Co. v. Herman, 691
F. Supp. 2d 283 (D. Mass. 2010) (ordering party to execute mutual release within 14 days
and providing that release otherwise would be deemed executed by that date); Big-D
Constr. Corp. v. Take It For Granite Too, No. 2:11-cv-621, 2013 WL 4519339 (D. Nev.
Aug. 23, 2013) (deeming settlement agreement fully executed upon party’s failure to fully
execute settlement documents).
As explained in the Decision and Order, despite the Court’s prior imposition of
sanctions and conclusion that Defendants made “repeated meritless filings designed to
delay compliance with the Court’s sanction order,” (1:12-cv-229-GZS, Order of Dismissal
at 2, ECF No. 128), Defendants consistently made baseless and frivolous filings. (Decision
and Order at 9.) Given the filings’ lack of merit and the nature of the filings,2 the filings
can fairly be characterized as vexatious and made in bad faith. The Court, therefore, will
impose the sanctions referenced in the Decision and Order, and sanctions for Defendants’
deliberate disregard for the Court’s order directing Defendants to sign the settlement

In the Decision and Order, the Court found that many of the post-settlement filings had been “baseless,
unproductive, and simply a means for Defendants to disparage their counsel, Plaintiffs, Plaintiffs’ counsel,
and the court process.” (Decision and Order at 8.)
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documents.3 See Hutto v. Finney, 437 U.S. 678, 690 n.14 (1978) (“An equity court has the
unquestioned power to award attorney’s fees against a party who shows bad faith by
delaying or disrupting the litigation or by hampering enforcement of a court order.”);
Dubois v. U. S. Dept. of Agriculture, 270 F.3d 77, 80 (1st Cir. 2001) (court can award
attorney’s fees to a prevailing party “when the losing party has acted in bad faith,
vexatiously, wantonly, or for oppressive reasons” (quoting Chambers v. NASCO, Inc., 501
U.S. 32, 46 (1991)); Farmer v. Banco Popular of N.A., 791 F.3d 1246 (10th Cir. 2015)
(upholding imposition of sanctions for party’s failure to comply with order to perform
under the terms of a settlement agreement).
As to the amount of the sanctions, in the Decision and Order, the Court wrote that
“a monetary sanction that at least in part considers the financial burden Plaintiffs have
incurred in connection with the need to respond to some of Defendants’ many unproductive
filings in their request to enforce the parties’ settlement agreement is warranted.”
(Decision and Order at 10.) In the context of assessing a sanction imposed in the Rule 11
context, the First Circuit noted that a “sanction usually serves two main purposes:
deterrence and compensation.” Navarro-Ayala v. Nunez, 968 F.2d 1421, 1426 (1st Cir.
1992). The Court also observed that in the assessment of a sanction, “proportionality is
often a proxy for appropriateness,” that “a monetary sanction aimed at deterrence is
appropriate only when the amount of the sanction falls within the minimum range

The Court’s assessment of Plaintiffs’ prior request for sanctions, and the Court’s rationale for the
imposition of sanctions in this case are set forth in the Decision and Order (ECF No. 264) and are
incorporated herein.
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reasonably required to deter abusive behavior,” and that “[w]hen a sanction is designed to
be compensatory, it should not compensate the opposing party … for any and all costs and
expenses incurred in response to the sanctionable conduct, …. only for the fair value of
response costs reasonably incurred.” Id. at 1427.
The Fourth Circuit also identified factors that should be considered in the
assessment of a sanction, which factors are instructive in this case. The factors relevant to
this case include: “(1) the reasonableness of the opposing party’s attorney’s fees; (2) the
minimum to deter; [and] (3) the ability to pay.” 4 In re Kunstler, 914 F.2d 505, 523 (4th
Cir. 1990) (citing White v. Gen. Motors Corp., 908 F.2d 675 (10th Cir. 1990)). The First
Circuit has recognized that “[d]eterrence is a widely recognized basis for determining the
amount of a monetary sanction.” Jones v. Winnepesaukee Realty, 990 F.2d 1, 6 (1st Cir.
1993). The First Circuit has also acknowledged that a party’s ability to pay the sanction is
an appropriate consideration. Silva v. Witschen, 19 F.3d 725, 733 n.15 (1st Cir. 1994).
In support of their request for sanctions, Plaintiffs submitted affidavits from counsel
documenting fees and costs incurred post-settlement in the amount of $18,111.44, for the
law firm of Monaghan Leahy, LLP, and $6,717.50, for Dow’s Law Office, P.A., for a total
of $24,824.94. The Court recognizes that Defendants’ frivolous filings required counsel
to file many pleadings that otherwise would have been unnecessary.

In addition,

Defendants’ failure to honor the settlement to which they agreed necessitated an

The Fourth Circuit also identified “factors related to the Rule 11 violation” as a factor. In re Kunstler,
914 F. 2d at 523.
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evidentiary hearing. Under the circumstances, the Court finds counsel’s fees and costs to
be reasonable.
As noted above, however, the reasonableness of the fees is but one of the factors the
Court must consider when assessing a sanction that is based on compensation and
deterrence. Regarding Defendants’ ability to pay, while Defendants are to receive a
considerable monetary payment as part of the settlement, the record does not otherwise
suggest Defendants have significant means. In addition, in the Court’s view, a sanction in
the full amount of the attorney fees incurred would exceed the minimum amount
reasonably necessary to deter future similar conduct. The Court, however, is mindful that
the monetary sanction in the amount of $266.80 previously imposed upon Defendants did
not deter future similar conduct. (1:12-cv-229-GZS, Order to Show Cause, ECF No. 122.)
After consideration of the relevant factors, including the First Circuit’s observation
that the amount of a sanction should be “proportional” and in the “minimum range
reasonably necessary to deter” the sanctioned conduct, Nunez, 968 F.2d at 1426, the Court
is convinced that a sanction that constitutes a modest portion of the fees and costs incurred
should be sufficient to deter future similar conduct while compensating Plaintiffs for some
of the attorney fees and costs they incurred. The Court concludes that an appropriate
monetary sanction is 25% of the fees and costs ($6,206.24), which amount represents
partial compensation for the counsel fees and costs Plaintiffs incurred as the result of
Defendants’ sanctioned conduct, an amount that is within the minimum range reasonably
necessary to deter future similar conduct, and an amount within Defendants’ ability to pay,

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particularly given the monetary consideration Defendants are to receive pursuant to the
terms of the parties’ settlement agreement.
Conclusion
Based on the foregoing analysis, the Court deems that Defendants have signed the
Universal Settlement Agreement and Release of All Claims (ECF No. 241-3) and Deed
(ECF Nos. 241-4 (sealed), 242-1 (redacted)) filed in support of Plaintiffs’ motion to enforce
the settlement agreement. In addition, for the reasons set forth in the Decision and Order
and this Order, which reasons include Defendants’ repeated refusal to comply with the
orders of this Court, including the order enforcing the parties’ settlement agreement, the
Court orders as a sanction that Defendants shall pay Plaintiffs the sum of $6,206.24.
Because the parties reached a binding agreement to settle this matter and because,
based on this Order, the settlement documents are complete, the Court dismisses with
prejudice all claims asserted in this matter.5

SO ORDERED.
/s/ John C. Nivison
U.S. Magistrate Judge
Dated this 24th day of October, 2018.

5

On August 30, 2016, the Court consolidated case nos. 1:12-cv-229-GZS and 2:15-cv-310-GZS. (Order,
ECF No. 46.) The dismissal is to all claims made in both of the consolidated actions.
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