Butcher et al v. Ward et al

Filing 26

ORDER DISMISSING CASE WITH PREJUDICE AND IMPOSING SANCTIONS AGAINST PLAINTIFFS' COUNSEL. Case Management Deadline set for 8/17/2022. Signed by Judge Mary K. Dimke. (TR, Case Administrator)

Download PDF
Case 2:22-cv-00023-MKD ECF No. 26 filed 08/02/22 PageID.209 Page 1 of 24 1 2 3 FILED IN THE U.S. DISTRICT COURT EASTERN DISTRICT OF WASHINGTON 4 Aug 02, 2022 5 UNITED STATES DISTRICT COURT 6 EASTERN DISTRICT OF WASHINGTON 7 8 GREGORY R. BUTCHER, husband, and SHARON L. BRYANTBUTCHER, wife, Plaintiffs, 9 10 11 12 v. No. 2:22-cv-00023-MKD ORDER DISMISSING CASE WITH PREJUDICE AND IMPOSING SANCTIONS AGAINST PLAINTIFFS’ COUNSEL STEPHEN H. WARD, husband, and MARIA WARD, wife, 13 14 SEAN F. MCAVOY, CLERK Defendants. On July 21, 2022, the Court conducted a third scheduling conference by 15 video. ECF No. 24. Paul S. Stewart, counsel for Defendants Stephen H. Ward and 16 Maria Ward, (jointly “Wards”), appeared by video. Plaintiffs’ counsel, John A. 17 Bardelli, did not appear despite the Court’s warning that failure to attend the 18 scheduling conference may result in dismissal for lack of prosecution. ECF No. 22 19 at 5. See ECF No. 24. 20 ORDER - 1 Case 2:22-cv-00023-MKD 1 ECF No. 26 filed 08/02/22 PageID.210 Page 2 of 24 Plaintiffs’ counsel’s absence at the third scheduling conference is in 2 conformance with his history of disobeying this Court’s orders and the 3 Federal/Local Rules of Civil Procedure. Since this matter was removed to the 4 Eastern District of Washington on February 14, 2022, Plaintiffs’ counsel has failed 5 to meet and confer with opposing counsel on two occasions, failed to participate in 6 drafting two of three joint status reports, failed to respond to a motion for summary 7 judgment, failed to appear at two of three scheduling conferences, and failed to 8 respond to two of three of the Court’s Orders to Show Cause. See ECF Nos. 9, 10, 9 16, 18, 19, 20, 21, 23, 24. 10 Plaintiffs’ counsel has demonstrated an unwillingness to comply with this 11 Court’s orders and the Federal/Local Rules of Civil Procedure, and the Court 12 concludes the appropriate remedy is to dismiss the action with prejudice pursuant 13 to Federal Rule of Civil Procedure 41(b). The Court also, pursuant to its inherent 14 power, imposes sanctions on Plaintiffs’ counsel for his numerous failures to 15 participate in proceedings, failure to abide by this Court’s orders, and failure to 16 comply with the Federal/Local Rules of Civil Procedure. 17 FACTUAL BACKGROUND 18 On February 19, 2018, Defendant Stephen H. Ward entered into a rental car 19 agreement with Hertz, a car rental company in Spokane, Washington. ECF No. 7 20 at 3; ECF No. 7-1 at 4. Former Defendant Overland West Inc. (“Overland”) owns ORDER - 2 Case 2:22-cv-00023-MKD ECF No. 26 filed 08/02/22 PageID.211 Page 3 of 24 1 and operates the Hertz car rental center where Mr. Ward leased the motor vehicle. 2 ECF No. 7 at 3. On March 2, 2018, Mr. Ward was in a motor vehicle collision 3 with Plaintiff Sharon L. Bryant-Butcher in Spokane, Washington. ECF No. 1-1 at 4 6. Mr. Ward was driving the motor vehicle he leased from Overland when the 5 collision occurred. Id. 6 On March 1, 2021, Plaintiffs Gregory R. Butcher and Sharon L. Bryant- 7 Butcher (jointly “Plaintiffs”), filed a complaint for damages against the Wards and 8 Overland in Spokane County Superior Court. Id. at 4. Plaintiffs’ Complaint 9 alleged Mr. Ward was negligent in the operation of the motor vehicle he leased 10 from Overland, and that Mr. Ward’s negligence was “imputed” to Overland. Id.1 11 at 7. On May 27, 2021, Overland was served with Plaintiffs’ Summons and 12 Complaint. Id. at 11. The Wards were served seven months later on January 15, 13 2022. ECF No. 1 at 2. On February 14, 2022, the Wards removed the matter to 14 the Eastern District of Washington pursuant to 28 U.S.C. § 1446, diversity 15 jurisdiction. See ECF No. 1. 16 A Notice Setting Scheduling Conference (“Notice”) was filed on March 7, 17 2022. ECF No. 6. The Notice ordered the parties to meet and confer at least 14 18 days in advance of a scheduling conference that was set for April 26, 2022. Id. at 19 2. The Notice also ordered the parties to file a joint status report by April 19, 20 2022, reflecting the results of their conference and the parties’ position with ORDER - 3 Case 2:22-cv-00023-MKD ECF No. 26 filed 08/02/22 PageID.212 Page 4 of 24 1 respect to each subject outlined in the Notice. Id. at 4. Shortly thereafter, on April 2 6, 2022, Overland filed a Motion for Summary Judgment asserting it is immune 3 from liability based on the Graves Amendment, 49 U.S.C. § 30106. ECF No. 7 at 4 1. 5 In response to the Court’s Notice, the Wards filed a status report on April 6 19, 2022. ECF No. 8. The Wards’ Status Report indicated that despite “multiple 7 emails by Wards’ counsel to Plaintiffs’ counsel and counsel for Defendant 8 Overland West, counsel did not confer to discuss the subjects required by the 9 Court. ECF No. 8 at 2. Plaintiff did not file a status report. Thereafter, a video 10 scheduling conference was held on April 26, 2022. See ECF No. 9. Counsel for 11 the Wards and Overland appeared by video on behalf of their respective clients. 12 See ECF No. 9. Plaintiffs’ counsel did not appear or notify the Court that he would 13 not be appearing. See ECF No. 9. 14 Following the scheduling conference, on April 26, 2022, the Court issued a 15 Notice Setting Second Scheduling Conference (“Second Notice”) which required 16 the parties to meet and confer and file a joint status report by May 10, 2022. ECF 17 No. 11 at 4. The Court also issued an Order to Show Cause on April 26, 2022, 18 ordering Plaintiffs to show why sanctions should not be imposed for: (1) failing to 19 meet and confer with opposing counsel prior to the scheduling conference; (2) 20 failing to file a joint status report; and (3) failing to appear at the scheduling ORDER - 4 Case 2:22-cv-00023-MKD ECF No. 26 filed 08/02/22 PageID.213 Page 5 of 24 1 conference, as required by the Court’s Notice. See ECF No. 10. The Court 2 provided Plaintiffs with seven days to respond to the Court’s Order to Show Cause. 3 Id. at 3. Plaintiffs did not respond. 4 Prior to the first scheduling conference, Overland filed a Motion for 5 Summary Judgment on April 6, 2022, asserting it is immune from liability based 6 on the Graves Amendment, 49 U.S.C. § 30106. ECF No. 7 at 1. Pursuant to Local 7 Civil Rule 7(c)(2)(B), Plaintiffs had 21 days to respond to Overland’s Motion. 8 Accordingly, the deadline for Plaintiffs to respond was April 27, 2022. Plaintiffs 9 did not respond on April 27, 2022, or anytime thereafter. On May 4, 2022, 10 Overland filed its Reply in Support of Summary Judgment, which noted Plaintiffs’ 11 failure to respond. See ECF No. 15. 12 Due to Plaintiffs’ failure to respond to Overland’s Motion for Summary 13 Judgment, on May 5, 2022, the Court issued a second order to show cause 14 requiring Plaintiffs to show why all facts within Overland’s Motion should not be 15 deemed undisputed. ECF No. 16 at 3. The Court provided Plaintiffs with seven 16 days to respond to the Court’s second Order to Show Cause. Id. Once again, 17 Plaintiffs did not file a response or contact the Court. 18 On May 9, 2022, the Wards and Overland filed a joint status report. ECF 19 No. 17. The Joint Status Report stated that the Wards and Overland met and 20 conferred on May 9, 2022, as directed by the Court’s Second Notice, however ORDER - 5 Case 2:22-cv-00023-MKD ECF No. 26 filed 08/02/22 PageID.214 Page 6 of 24 1 Plaintiffs’ counsel did not attend or participate in the parties’ conference. Id. at 1. 2 On May 17, 2022, the Court held a second video scheduling conference. See ECF 3 No. 18. At the second scheduling conference, Plaintiffs’ counsel appeared by 4 telephone. See id. 5 At the May 17, 2022, the scheduling conference, Plaintiffs’ counsel asserted 6 he had not complied with either of the Court’s Notices, participated in drafting 7 joint status reports with opposing counsel, or responded to the Court’s two prior 8 orders to show cause because he was in the process of being evicted from his office 9 space. As stated on the record, the Court found Plaintiffs’ counsel’s explanation 10 insufficient and explained that despite the process of eviction, Plaintiffs’ counsel 11 presumably had access to his work e-mail account (an “AOL” account which is 12 accessible by any internet connection), to which he would have received the 13 Court’s notices and orders. The Court further advised Plaintiffs’ counsel that he 14 could have contacted opposing counsel or the Court to explain the circumstances 15 and seek relief from the Court’s deadlines. 16 The Court advised Plaintiffs’ counsel that his failure to do so required 17 significant expenditure of resources by opposing counsel and wasted Court 18 resources. Due to Plaintiffs’ counsel’s failure to meet and confer and participate in 19 drafting the Joint Status Report, the Court postponed the scheduling conference for 20 a second time. See ECF No. 18. ORDER - 6 Case 2:22-cv-00023-MKD ECF No. 26 filed 08/02/22 PageID.215 Page 7 of 24 1 On May 19, 2022, the Court issued a third order requiring Plaintiffs to show 2 cause: (1) why the matter should not be dismissed for Plaintiffs’ failure to comply 3 with the Court’s Orders and Plaintiffs’ failure to prosecute; (2) why sanctions 4 should not be imposed for Plaintiffs’ counsel’s failure to meet and confer on two 5 occasions, failure to file the two ordered joint status reports, and his absence during 6 the first scheduling conference; and (3) why all facts in Overland’s Motion for 7 Summary Judgment should not be deemed admitted. ECF No. 19 at 8. The Court 8 provided Plaintiffs with 14 days to respond to its third Order to Show Cause and 9 warned: 10 11 12 If Plaintiffs do not file a response, or a response with sufficient explanation and documentation, before June 2, 2022, the case will be dismissed with prejudice and/or sanctions will be imposed. ECF No. 19 at 8. 13 In its third Order to Show Cause, the Court identified that Plaintiffs’ 14 counsel’s behavior in this matter is strikingly similar to his behavior in previous 15 cases, as well as another matter in the Eastern District of Washington, Mesecher et 16 al. v. Lowes Companies Inc et al., 2:17-cv-00299-RMP (failing to respond to 17 motions to dismiss and failing to respond to an order to show cause). ECF No. 19 18 at 5, 6. 19 20 The Court explained that in Mescher, like the matter at hand, the case was initially filed by Plaintiffs’ counsel in state court and subsequently removed to ORDER - 7 Case 2:22-cv-00023-MKD ECF No. 26 filed 08/02/22 PageID.216 Page 8 of 24 1 federal court based on diversity jurisdiction. Id. at 6. The Court also noted that 2 Plaintiffs’ counsel in Mesecher did not file responses to two motions to dismiss. 3 Id. at 6 (citing 2:17-cv-00299-RMP, at ECF No. 12 at 1). Plaintiffs’ counsel in 4 Mescher also failed to respond to an order to show cause. Id. Ultimately, the 5 Mesecher court granted the motions to dismiss in part because Plaintiffs’ counsel 6 did not respond to the motions or participate in litigation after the matter was 7 removed. Id. 8 Also, within the Court’s third Order to Show Cause, the Court noted that in 9 2011, the Washington State Bar temporarily suspended Plaintiffs’ counsel in part 10 because he failed to file a responsive pleading to a motion for summary judgment. 11 ECF No. 19 at 6.1 Plaintiffs’ counsel then sought a continuance of the summary 12 judgment hearing contending he was ill. Id. After the hearing, the court denied 13 Plaintiffs’ counsel’s motion for a continuance, granted the defendant’s motion, and 14 dismissed the case. Id. Plaintiffs’ counsel then failed to notify his clients of the 15 dismissal of their suit and appealed the dismissal without his client’s knowledge or 16 permission. Id. at 7. 17 18 1 19 https://www.mywsba.org/PersonifyEbusiness/DisciplineNoticeDirectory/Disciplin 20 eNoticeDetail.aspx?dID=1607. Citing: ORDER - 8 Case 2:22-cv-00023-MKD 1 ECF No. 26 filed 08/02/22 PageID.217 Page 9 of 24 On June 3, 2022, one day after the 14-day deadline, Plaintiffs filed a 2 response to the Court’s third Order to Show Cause. See ECF No. 20. 2 In the 3 Response, Plaintiffs’ counsel asserted that his office was in the process of eviction 4 proceedings. Id. at 2. Plaintiffs’ counsel explained that his failure to respond to 5 the Court’s previous Orders to Show cause was due to the eviction proceedings. 6 Id. at 2-3. Plaintiffs’ counsel also asserted that he was without the use of 7 computers and electronic equipment from approximately March 15, 2022, to April 8 1, 2022, which additionally contributed to his failure to respond to the Court’s 9 Orders to Show Cause. Id. 10 Plaintiffs’ Response to the third Order to Show Cause, however, did not 11 provide reasoning why the Court should not deem all facts in Overland’s Motion 12 for Summary Judgment as undisputed, as required by the Court’s third Order to 13 Show Cause. See id.; ECF No. 19 at 8. Accordingly, on June 21, 2022, due to 14 Plaintiffs’ counsel failure to respond and lack of participation in the litigation, the 15 Court accepted all facts in Overland’s motion as undisputed and granted 16 Overland’s Motion for Summary Judgment. ECF No. 21 at 2. 17 18 2 19 asserted he attempted to file the Response on the June 2, 2022 deadline, but 20 encountered difficulties with the Court’s electronic filing system. Plaintiffs’ counsel left a voicemail for the Court on June 2, 2022, where he ORDER - 9 Case 2:22-cv-00023-MKD 1 ECF No. 26 filed 08/02/22 PageID.218 Page 10 of 24 On June 24, 2022, the Court issued a Third Notice Setting Scheduling 2 Conference to be held on July 21, 2022. ECF No. 22. In bold print the Court 3 instructed and warned: 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 If Plaintiffs’ counsel fails to participate in the conference with opposing counsel, fails to file a Joint Status Report, or fails to attend the scheduling conference, he shall risk the matter being dismissed for lack of prosecution. ECF No. 22 at 5. Plaintiffs complied with the first requirement and conferred with opposing counsel to draft a joint status report which was filed on July 5, 2022. See ECF No. 22. However, despite the Court’s explicit warning against failing to attend the scheduling conference, Plaintiffs’ counsel failed to appear or provide notice of an inability to appear at the July 21, 2022, conference. See ECF No. 24. At the hearing, the Court waited approximately ten minutes for Plaintiffs’ counsel to appear and attempted to reach Plaintiffs’ counsel by telephone two times. Each time the Court called Plaintiffs’ counsel’s phone, it rang without answer and there was not an option to leave a voicemail. Plaintiffs’ counsel did not respond to the Court’s telephone calls or contact the Court in any manner after the July 21, 2022 scheduling conference. After attempting to reach Plaintiffs’ counsel, the Court directed the Wards’ counsel to file a declaration detailing the costs the Wards have incurred for their counsel’s preparation for and attendance at the three scheduling conferences. Per ORDER - 10 Case 2:22-cv-00023-MKD ECF No. 26 filed 08/02/22 PageID.219 Page 11 of 24 1 the Court’s instruction, the Wards’ counsel, Paul S. Stewart, submitted a 2 declaration, ECF No. 25, stating his hourly rate and an itemized list detailing the 3 time he has spent on this matter. Mr. Stewart asserts that the total fees his client 4 has paid him to prepare for and attend the Court’s scheduling conferences and to 5 prepare his declaration equals $770.00 (4.4 hours at an hourly rate of $175). ECF 6 No. 25 at 3, 4. 7 As of the filing of this Order, Plaintiffs’ counsel has not contacted the Court 8 to provide an explanation for his absence at the July 21, 2022, scheduling 9 conference. LEGAL STANDARDS 10 11 12 A. Dismissal With Prejudice Federal Rule of Civil Procedure 41(b) permits dismissal of an action for the 13 failure to prosecute or comply with rules or a court order. Fed. R. Civ. P. 41(b). 14 Under Rule 41(b), a court may dismiss an action sua sponte for failure to prosecute 15 or to comply with a court order. Fed. R. Civ. P. 41(b). See Chambers v. NASCO, 16 Inc., 501 U.S. 32, 44 (1991) (recognizing that a court “may act sua sponte to 17 dismiss a suit for failure to prosecute”); Hells Canyon Pres. Council v. U.S. Forest 18 Serv., 403 F.3d 683, 689 (9th Cir. 2005) (recognizing that a court may sua sponte 19 dismiss an action for a plaintiff’s failure to prosecute or comply with the rules of 20 civil procedure or the court’s orders pursuant to Rule 41(b)); Ghazali v. Moran, 46 ORDER - 11 Case 2:22-cv-00023-MKD ECF No. 26 filed 08/02/22 PageID.220 Page 12 of 24 1 F.3d 52, 53 (9th Cir.1995) (failure to follow a district court’s local rules is a proper 2 ground for dismissal); Ferdik v. Bonzelet, 963 F.2d 1258, 1260 (9th Cir.1992) 3 (“[p]ursuant to Federal Rule of Civil Procedure 41(b), the district court may 4 dismiss an action for failure to comply with any order of the court”); Thompson v. 5 Housing Auth. of City of L.A., 782 F.2d 829, 831 (9th Cir.1986) (stating that 6 district courts have inherent power to control their dockets and may impose 7 sanctions including dismissal or default). 8 In determining whether a Rule 41(b) dismissal is appropriate, a court must 9 weigh the following factors: “(1) the public’s interest in expeditious resolution of 10 litigation; (2) the court’s need to manage its docket; (3) the risk of prejudice to the 11 defendants; (4) the public policy favoring disposition of cases on their merits and 12 (5) the availability of less drastic sanctions.” Omstead v. Dell, Inc., 594 F.3d 1081, 13 1084 (9th Cir. 2010) (quotations omitted). Dismissal is appropriate “where at least 14 four factors support dismissal . . . or where at least three factors strongly support 15 dismissal.” Hernandez v. City of El Monte, 138 F.3d 393, 399 (9th Cir. 1998) 16 (citation and quotation marks omitted). Dismissal under Rule 41(b) operates as an 17 adjudication on the merits. Fed. R. Civ. P. 41(b). 18 1. Expeditious Resolution of Litigation 19 “As the first of the Federal Rules of Civil Procedure reflects, the public has 20 an overriding interest in securing ‘the just, speedy, and inexpensive determination ORDER - 12 Case 2:22-cv-00023-MKD ECF No. 26 filed 08/02/22 PageID.221 Page 13 of 24 1 of every action.’” In re Phenylpropanolamine (PPA) Prod. Liab. Litig., 460 F.3d 2 1217, 1227 (9th Cir. 2006) (quoting Fed. R. Civ. P. 1). “Orderly and expeditious 3 resolution of disputes is of great importance to the rule of law. By the same token, 4 delay in reaching the merits, whether by way of settlement or adjudication, is 5 costly in money, memory, manageability, and confidence in the process.” 6 Phenylpropanolamine, 460 F.3d. at 1227. Non-compliance with procedural rules 7 and a court’s orders wastes “valuable time that [the court] could have devoted to 8 other… criminal and civil cases on its docket.” Ferdik, 963 F.2d at 1261. 9 As a result of Plaintiffs’ failures to abide by this Court’s orders and the 10 Federal/Local Rules of Civil Procedure, this Court has: (1) held three status 11 conferences; (2) issued three orders to show cause; and (3) reset scheduling 12 conferences on two occasions. Each time the Court undertakes one of these 13 activities, valuable and limited Court resources are expended. Because of the 14 continued exhaustion of valuable Court resources, the Court finds the first factor 15 weighs heavily in favor of dismissal. 16 2. Docket Management 17 District judges are best situated to decide when delay in a particular case 18 interferes with docket management and the public interest. Ash v. Cvetkov, 739 19 F.2d 493, 496 (9th Cir. 1984). The pressing caseload in most district courts 20 requires the cooperation of litigants in moving forward so that judicial resources ORDER - 13 Case 2:22-cv-00023-MKD ECF No. 26 filed 08/02/22 PageID.222 Page 14 of 24 1 are available to others. Id.; see Phenylpropanolamine, 460 F.3d at 1234 (affirming 2 a dismissal sanction where the district court had “observed that many of the cases 3 subject to its dismissal order had been pending for close to, or over, a year without 4 forward movement, and that such lack of diligence does not serve the public 5 interest in expeditious resolution of litigation”). 6 It has been 17 months since this matter was originally filed in Spokane 7 County Superior Court and six months since the matter was removed to the Eastern 8 District of Washington. Due to Plaintiffs’ continued failure to follow this Court’s 9 orders and participate in scheduling conferences, this Court has not yet been able 10 to issue a scheduling order. This has prevented the Court from setting case 11 management deadlines and a trial date. Given the size of this Court’s criminal and 12 civil dockets, this type of delay creates scheduling problems for many other 13 matters. As such, the Court finds the second factor also weighs strongly in favor of 14 dismissal. 15 3. Prejudice to Defendants 16 The Ninth Circuit has held that the pendency of a lawsuit, cannot by itself be 17 considered as prejudicial enough to warrant dismissal. Ash, 739 F.2d 493, 496 (9th 18 Cir. 1984). “Otherwise a delay of even one day would be justifiable grounds for 19 dismissal for lack of prosecution. Limited delays and the prejudice to a defendant 20 ORDER - 14 Case 2:22-cv-00023-MKD ECF No. 26 filed 08/02/22 PageID.223 Page 15 of 24 1 from the pendency of a lawsuit are realities of the system that have to be accepted, 2 provided the prejudice is not compounded by ‘unreasonable’ delays.” Id. 3 Here, the Court finds that Plaintiffs have caused unreasonable delays by 4 failing to respond to the Court’s orders and failing to attend Court mandated 5 conferences. At a minimum, the Wards have been prejudiced by Plaintiffs’ failure 6 to diligently prosecute the case and move it forward towards a resolution on the 7 merits. It has been over four years since the underlying incident occurred and as 8 time goes by, evidence is lost and witnesses’ memories fade, making it more 9 difficult to defend this case. The Wards have also suffered prejudice in attorney 10 fees and costs in the amount of $770.00 for the time their counsel prepared for and 11 appeared at the Court’s three scheduling conferences. ECF No. 25 at 3. The Court 12 finds Plaintiffs’ dilatory manner in prosecuting this matter has prejudiced the 13 Wards and therefore the third factor weighs in favor of dismissal. 14 4. Dispositions on the Merits 15 “Public policy favoring disposition of cases on their merits strongly counsels 16 against dismissal.” Phenylpropanolamine, 460 F.3d at 1227 (citation omitted). 17 But a case that “is stalled or unreasonably delayed by a party’s failure to 18 [prosecute] cannot move forward toward resolution on the merits.” Id. This factor 19 “lends little support” to Plaintiffs – “whose responsibility it is to move [their cases] 20 ORDER - 15 Case 2:22-cv-00023-MKD ECF No. 26 filed 08/02/22 PageID.224 Page 16 of 24 1 toward disposition on the merits but whose conduct impedes progress in that 2 direction.” Id. 3 This Court recognizes the importance of disposition of cases on their merits, 4 however, the Court finds this factor is outweighed by the previously discussed 5 factors. Further, Plaintiffs’ numerous and unnecessary delays have precluded and 6 limited the possibility of this case being decided on its merits. Accordingly, while 7 disposition of cases on their merits is preferred, here there is no indication that 8 Plaintiffs’ continued inaction and disobedience will be cured allowing the matter to 9 be decided on its merits. 10 5. Availability of Less Drastic Sanctions 11 District courts have a range of options at their disposal, in addition to 12 imposing a terminating sanction, such as a dismissal, they can impose less-drastic 13 sanctions that include “a warning, a formal reprimand, placing the case at the 14 bottom of the calendar, a fine, the imposition of costs or attorney fees, the 15 temporary suspension of the culpable counsel from practice before the court, ... 16 dismissal of the suit unless new counsel is secured ... preclusion of claims or 17 defenses, or the imposition of fees and costs upon plaintiff’s counsel.” Malone v. 18 U.S. Postal Service, 833 F.2d at 132, fn. 1 (citations omitted). The district court 19 need not exhaust every sanction short of dismissal before finally dismissing a case 20 ORDER - 16 Case 2:22-cv-00023-MKD ECF No. 26 filed 08/02/22 PageID.225 Page 17 of 24 1 but must explore possible and meaningful alternatives. Nevijel v. North Coast Life 2 Insurance Co., 651 F.2d 671, 674 (9th Cir. 1981). 3 As detailed above, the Court has previously pursued remedies that are less 4 drastic than dismissal by issuing three orders to show cause and clearly warning 5 Plaintiffs of the consequences of failing to comply with the Court’s orders. 6 However, with such efforts having now been exhausted, the Court finds no suitable 7 alternative to dismissal of the action. 8 9 The Court recognizes that most if not all, of the fault is a result of Plaintiffs’ counsel’s failure to abide by this Court’s orders and failure to obey the 10 Federal/Local Rules of Civil Procedure. For that very reason, the Court took 11 multiple measures to avoid the harsh sanction of dismissal and attempted to 12 generate compliance through less severe measures. The Court has endeavored to 13 provide Plaintiffs a fair opportunity to move their case forward and has been 14 exceptionally lenient in providing Plaintiffs with instructions and warnings. 15 Ultimately, this leniency has expended limited Court resources and the Wards have 16 incurred duplicative attorney fees and costs. 17 In light of the foregoing, it is clear Plaintiffs’ counsel is unwilling to comply 18 with this Court’s orders and the Federal/Local Rules of Civil Procedure, leaving 19 the Court with no choice but to dismiss the action with prejudice pursuant to 20 Federal Rule of Civil Procedure 41(b). ORDER - 17 Case 2:22-cv-00023-MKD 1 2 ECF No. 26 filed 08/02/22 PageID.226 Page 18 of 24 B. Monetary Sanctions Against Plaintiffs’ Counsel “It has long been understood that ‘[c]ertain implied powers must necessarily 3 result to our Courts of justice from the nature of their institution,’ powers ‘which 4 cannot be dispensed with in a Court, because they are necessary to the exercise of 5 all others.’” Chambers, 501 U.S. at 43 (citations omitted). “These powers are 6 ‘governed not by rule or statute but by the control necessarily vested in courts to 7 manage their own affairs so as to achieve the orderly and expeditious disposition of 8 cases.’” Chambers, 501 U.S. at 43 (quoting Link v. Wabash R., 370 U.S. 626, 630- 9 31 (1962)). 10 The inherent power of the federal courts includes the power “to discipline 11 attorneys who appear before it,” however, the Supreme Court has cautioned “this 12 power ‘ought to be exercised with great caution.’” Chambers, 501 U.S. at 43 13 (citations omitted). Because of the potency of inherent powers, a court must 14 exercise its inherent powers with restraint and discretion, and a primary aspect of 15 that discretion is the ability to fashion an appropriate sanction. See Chambers, 501 16 U.S. at 44-45. Further, in invoking its inherent power, a court “must comply with 17 the mandates of due process.” Id. at 50. Accordingly, before a district court may 18 impose sanctions, the attorney or party must receive notice that sanctions against 19 them are being considered and have an opportunity to be heard. See Id. at 56-57. 20 Notice and an opportunity to be heard are “essential in view of the ORDER - 18 Case 2:22-cv-00023-MKD ECF No. 26 filed 08/02/22 PageID.227 Page 19 of 24 1 heightened potential for abuse posed by the contempt power, and the provision of 2 these procedural protections accords with our historic notions of elementary 3 fairness.” Lasar v. Ford Motor Co., 399 F.3d 1101, 1110 (9th Cir. 2005) (citations 4 omitted). These minimal procedural requirements give an attorney an opportunity 5 to argue that his actions were an acceptable means of representing his client, to 6 present mitigating circumstances, or to apologize to the court for his conduct. Id. 7 However, district courts are not required to conduct a formal hearing before 8 imposing monetary sanctions against an attorney where the attorney was given 9 opportunity to respond in writing to allegations lodged against him. See Pacific 10 Harbor Capital, Inc. v. Carnival Air Lines, Inc., 210 F.3d 1112, 1118 (9th Cir. 11 2000). 12 Here, as discussed in great length and detail above, the Court has provided 13 Plaintiffs’ counsel with multiple opportunities to explain his continued failure to 14 abide by this Court’s orders. Plaintiffs’ counsel responded to only one of the 15 Court’s three orders to show cause and, as noted above, his response was 16 insufficient. Further, Plaintiffs’ counsel only partially and minimally complied 17 with this Court’s three scheduling conference notices. Accordingly, the Court 18 finds it has offered Plaintiffs’ counsel sufficient notice and opportunity to be heard 19 and that Plaintiffs’ counsel has failed to take advantage of these opportunities. The 20 Court further finds that a formal hearing is not necessary and would not be ORDER - 19 Case 2:22-cv-00023-MKD 1 2 ECF No. 26 filed 08/02/22 PageID.228 Page 20 of 24 productive given Plaintiffs’ counsel’s absences at previous hearings. The next inquiry is whether Plaintiffs’ counsel’s behavior warrants monetary 3 sanctions. A district judge has broad authority to impose monetary sanctions 4 “upon its own initiative” when an attorney fails to obey a scheduling order or 5 appear at a scheduling conference. In re Yagman, 796 F.2d 1165, 1187, as 6 amended, 803 F.2d 1085 (1986), cert. denied, 484 U.S. 963 (1987); see also 7 Tamura v. F.A.A., 908 F.2d 977, *2 (9th Cir. 1990) (unpublished). The Court may 8 order a party’s attorney “to pay the reasonable expenses—including attorney’s 9 fees—incurred because of any noncompliance” with Rule 16(f). Fed. R. Civ. P. 10 11 16(f)(2); see also Ayers v. City of Richmond, 895 F.2d 1267, 1270 (9th Cir. 1990). Under its “inherent powers,” a district court may award sanctions in the form 12 of attorneys’ fees against a party or counsel who acts “in bad faith, vexatiously, 13 wantonly, or for oppressive reasons.” Primus Auto. Fin. Servs., Inc. v. Batarse, 14 115 F.3d 644, 648 (9th Cir.1997). The most common utilization of inherent 15 powers is a contempt sanction levied to “protect[ ] the due and orderly 16 administration of justice” and “maintain[ ] the authority and dignity of the court.” 17 Id. (quoting Cooke v. United States, 267 U.S. 517, 539 (1925)). Courts have 18 found bad faith in a variety of conduct stemming from “a full range of litigation 19 abuses.” Chambers, 501 U.S. at 47. For instance, bad faith has been found by a 20 ORDER - 20 Case 2:22-cv-00023-MKD ECF No. 26 filed 08/02/22 PageID.229 Page 21 of 24 1 party for “delaying or disrupting the litigation.” Primus Auto. Fin. Servs., 115 F.3d 2 at 648. 3 In addition, sanctions have been found proper in instances where the parties 4 were not necessarily acting in bad faith. For example, in Lucas Automotive 5 Engineering, Inc. v. Bridgestone/Firestone, Inc., the Ninth Circuit ruled that the 6 district court’s imposition of sanctions was appropriate when a party member 7 unintentionally failed to attend a mediation session due to an incapacitating 8 headache. See Lucas Automotive Engineering, Inc. v. Bridgestone/Firestone, Inc., 9 275 F.3d 762, 769 (9th Cir. 2001). Similarly, in Ayers v. City of Richmond, the 10 Ninth Circuit affirmed sanctions awarding attorney’s fees and costs to opposing 11 counsel when counsel failed to attend only one pretrial conference because it 12 “slipped by him.” Ayers 895 F.2d at 1269. 13 Here, Plaintiffs’ counsel’s continued disregard for this Court’s orders has 14 without doubt delayed the litigation process. As stated above it has been six 15 months since this matter was removed and the Court has not been able to issue a 16 scheduling order due to Plaintiffs’ counsel’s continued failure to participate in this 17 litigation. The Court has been overly lenient in giving Plaintiffs’ counsel ample 18 opportunity to alter his behavior to accord with the Court’s orders, and Plaintiffs’ 19 counsel has disregarded nearly every opportunity to comply. Plaintiffs’ counsel’s 20 repeated absence has prevented the orderly and expeditious disposition of this ORDER - 21 Case 2:22-cv-00023-MKD ECF No. 26 filed 08/02/22 PageID.230 Page 22 of 24 1 matter, frustrated the judicial process, and strained judicial resources. 2 Accordingly, the Court finds Plaintiffs’ counsel has acted in bad faith and that a 3 monetary sanction is appropriate. 4 Monetary sanctions, under the Court’s inherent authority, are “limited to the 5 fees the innocent party incurred solely because of the misconduct—or put another 6 way, to the fees that party would not have incurred but for the bad faith.” 7 Goodyear Tire & Rubber Co. v. Haeger, 137 S. Ct. 1178, 1184, (2017). This is a 8 “but-for” test by which a party may recover only the portion of its fees that it 9 would not have paid but for the misconduct. Id. at 1187. Here, the Wards would 10 not have incurred $770.00 in attorney’s fees had Plaintiffs’ counsel abided by this 11 Court’s orders. 12 When issuing attorney fees as a sanction, Federal Rule of Civil Procedure 13 16(f)(2) provides that “the court must order the party, its attorney, or both to pay 14 the reasonable expenses-including attorney’s fees-incurred because of any 15 noncompliance with this rule, unless the noncompliance was substantially justified 16 or other circumstances make an aware of expenses unjust.” Fed. R. Civ. P. 16(f) 17 (2) (emphasis added). As discussed above, Plaintiffs’ counsel has failed to 18 demonstrate that his noncompliance was substantially justified. Accordingly, the 19 next course of inquiry for this Court is whether the Wards’ attorney fees are 20 reasonable. ORDER - 22 Case 2:22-cv-00023-MKD 1 ECF No. 26 filed 08/02/22 PageID.231 Page 23 of 24 A district court must calculate attorney fee awards using the “lodestar 2 method.” Camacho v. Bridgeport Fin., Inc., 523 F.3d 973, 978 (9th Cir. 2008). 3 The lodestar method requires “multiplying the number of hours the prevailing 4 party reasonably expended on the litigation by a reasonable hourly rate.” Id. The 5 resulting lodestar figure is a presumptively reasonable fee award. Camacho, 523 6 F.3d at 977. District courts “[have] a great deal of discretion in determining the 7 reasonableness of the fee.” Id. 8 Here, the Wards’ counsel, Paul S. Stewart, has been practicing law for over 9 seven years at the law firm Paine Hamblen, LLP, in Spokane, Washington. ECF 10 No. 25 at 2. Prior to joining Paine Hamblen, Mr. Stewart was a Washington State 11 Supreme Court clerk, a clerk for the Honorable Wm. Fremming Nielsen in the U.S. 12 District Court for Eastern Washington, and a magistrate clerk for the Honorable 13 John T. Rogers, also in the Eastern District of Washington. Id. Mr. Stewart’s civil 14 litigation practice encompasses real estate litigation, employment litigation, 15 insurance litigation, and insured defense. Id. Mr. Stewart’s hourly rate is $175.00 16 and his declaration states he has spent 4.4 hours preparing for the three scheduling 17 conferences held by the Court. Id. at 3, 4. 18 Given Mr. Stewart’s experience and background, the Court finds his hourly 19 rate of $175.00 to be reasonable and further finds that the 4.4 hours Mr. Stewart 20 expended preparing for the three scheduling conferences is reasonable. ORDER - 23 Case 2:22-cv-00023-MKD ECF No. 26 filed 08/02/22 PageID.232 Page 24 of 24 1 Accordingly, the Court finds that a reasonable monetary sanction against Plaintiffs’ 2 counsel is the $770.00 the Wards incurred as a result of the three scheduling 3 conferences. 4 5 6 7 IT IS ORDERED: 1. This action shall be DISMISSED with prejudice pursuant to Federal Rule of Civil Procedure 41(b). 2. The Court hereby SANCTIONS John A. Bardelli personally in the amount 8 of $770.00, payable to Paine Hamblen LLP’s IOLTA account, to compensate the 9 Wards for their counsel’s time. 10 3. John A. Bardelli shall comply with this sanctions order and submit payment 11 by August 17, 2022, at 5:00 p.m. Counsel shall file a notice with the Court 12 indicating compliance with this order. 13 IT IS SO ORDERED. The District Court Executive is directed to file this 14 Order, provide copies to the parties, and set a case management deadline for 15 August 17, 2022. 16 DATED August 2, 2022. 17 s/Mary K. Dimke MARY K. DIMKE UNITED STATES DISTRICT JUDGE 18 19 20 ORDER - 24

Disclaimer: Justia Dockets & Filings provides public litigation records from the federal appellate and district courts. These filings and docket sheets should not be considered findings of fact or liability, nor do they necessarily reflect the view of Justia.

Why Is My Information Online?