Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-casd-3_10-cv-01411/USCOURTS-casd-3_10-cv-01411-3/pdf.json

Nature of Suit Code: 830
Nature of Suit: Patent
Cause of Action: 15:1126 Patent Infringement

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UNITED STATES DISTRICT COURT

SOUTHERN DISTRICT OF CALIFORNIA

CREATIVE COMPOUNDS, LLC; S103,

INC.,

Plaintiffs,

CASE NO. 10CV1411 WQH (RBB)

ORDER

vs.

MATTHIAS BOLDT; JOSEPH

RODRIGUES; S.A.N. NUTRITION

CORP.,

Defendants.

HAYES, Judge:

The matter before the Court is the Motion for Sanctions pursuant to Fed. R. Civ. P.11

filed by Defendants Matthias Boldt and S.A.N. Nutrition Corp. (ECF No. 27). 

I. Background

On July 6, 2010, Creative Compounds, LLC and S103, Inc. initiated this action by

filing the Complaint. (ECF No. 1). On September 15, 2010, Defendants Matthias Boldt and

S.A.N. Nutrition Corp. filed a Motion to Dismiss the Complaint which was granted. (ECF

Nos. 8, 14). 

On February 11, 2011, Plaintiffs filed a Motion for Leave to file a First Amended

Complaint which was granted. (ECF Nos. 15, 18). On April 7, 2011, the First Amended

Complaint was filed. (ECF No. 19). 

On April 27, 2011, Defendants filed a Motion to Dismiss the First Amended

Case 3:10-cv-01411-WQH-RBB Document 31 Filed 11/15/11 Page 1 of 4
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 In Defendants’ Reply, Defendants seek the alternative relief of sanctions pursuant to

the court’s inherent authority provided by 28 U.S.C. § 1927. Generally, courts decline to

consider arguments raised for the first time in a reply brief as it deprives the opposing party

of adequate opportunity to respond. See Adriana Intern. Corp. v. Thoeren, 913 F.2d 1406,

1417 n.12 (9th Cir. 1990); United States v. Boyce, 148 F. Supp. 2d 1069, 1085 (S.D. Cal. 2001)

(citing United States v. Bohn, 956 F.2d 208, 209 (9th Cir. 1992)). Even if the Court considered

Defendants request for sanctions pursuant to the court’s inherent authority, the Court would

deny the request.

28 U.S.C. § 1927 provides that: “Any attorney ... 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.” Id.

The Court must make a “finding of subjective bad faith.” BKB v. Maui Police Dep’t, 276 F.3d

1091, 1107 (9th Cir. 2002). The Court does not find that Plaintiffs multiplied the proceedings

and the Court does not find that Plaintiffs acted with subjective bad faith. 

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Complaint. (ECF No. 20). On August 31, 2011, Defendants’ Motion to Dismiss the First

Amended Complaint was granted. (ECF No. 25). The First Amended Complaint was

dismissed without leave to amend.

On October 7, 2011, Defendants filed a Motion for Sanctions pursuant to Fed. R. Civ.

P.11. (ECF No. 27). On October 31, 2011, Plaintiffs filed an Opposition. (ECF No. 28). On

November 3, 2011, Defendants filed a Reply. (ECF No. 29). 

II. Contentions of the Parties

Defendants seek an award of sanctions in the amount of $75,000.00 and an award of

attorney’s fees in the amount of $27,843.99 for a total of $102,843.99. Defendants contend

that the Complaint and First Amended Complaint were meritless, contained contradictory

factual allegations, and failed to state a claim. Defendants contend that the Complaint and

First Amended Complaint were filed in bad faith for the improper purpose of harassing

Defendants and increasing Defendants’ legal fees. Defendants contend that “plaintiffs have

engaged in similar conduct by litigating the same unsuccessful and frivolous claims numerous

times in state and federal courts.” (ECF No. 27 at 3). Defendants contend that they have

substantially complied with Rule 11’s safe harbor provision on the grounds that Defendants

provided Plaintiff with a letter describing the offensive conduct on September 1, 2010.1

Plaintiffs contend that they have not acted in bad faith. Plaintiffs contend that the

Complaint and First Amended Complaint were not frivolous and were not filed for an

improper purpose. Plaintiffs contend that Defendants failed to comply with the twenty-one

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day safe harbor provision in Rule 11 on the grounds that Defendants filed and served the

Motion for Sanctions on the same day. 

III. Discussion

Federal Rule of Civil Procedure 11(c) provides:

If, after notice and a reasonable opportunity to respond, the court determines

that subdivision (b) has been violated, the court may, subject to the

conditions stated below, impose an appropriate sanction upon the attorneys,

law firms, or parties that have violated subdivision (b) or are responsible for

the violation.

Fed. R. Civ. P. 11(c)(1). Rule 11 places “stringent notice and filing requirements on parties

seeking sanctions.” Holgate v. Baldwin, 425 F.3d 671, 677 (9th Cir. 2005). Rule 11 contains

a “safe harbor” provision, which requires a party seeking sanctions “to give the opposing party

21 days” to withdraw or otherwise correct the offending paper before filing the motion for

sanctions. Id. at 678; Fed. R. Civ. P. 11(c)(1)(A). The Court of Appeal for the Ninth Circuit

enforces the safe harbor provision “strictly,” and “must reverse the award of sanctions when

the challenging party [fails] to comply with the safe harbor provisions, even when the

underlying filing is frivolous.” Id. at 678; see also Radcliffe v. Rainbow Constr. Co., 254 F.3d

772, 789 (9th Cir. 2001) (finding that plaintiff’s informal warnings did not satisfy the “strict

requirement that a motion be served on the opposing party twenty-one days prior to filing.”);

Barber v. Miller, 146 F.3d 707, 710 (9th Cir. 1998) (“[I]t would therefore wretch both the

language and purpose of the amendment to the Rule to permit an informal warning to substitute

for service of a motion”);. Bailey v. Root, Case No. 10cv0367 BTM(CAB), 2010 WL 2803950

at *5 (S.D. Cal. July, 14 2010) (denying request for sanctions on the grounds that the movant

did not comply with the safe harbor provision).

In this case, Defendants served and filed the Motion for Sanctions pursuant to Rule

11 on the same day. Accordingly, the Motion fails to give the required safe harbor notice. In

addition, the Motion was served and filed after the Complaint was dismissed with prejudice

depriving Plaintiffs “of any opportunity to take advantage of the safe harbor provision.”

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 Plaintiffs also seek an award of attorney’s fees and costs for time spent opposing this

Rule 11 Motion. Federal Rule of Civil Procedure 11(c) provides: “If warranted, the court may

award to the prevailing party the reasonable expenses, including attorney's fees, incurred for

the motion.” Fed. R. Civ. P. 11(c)(2). The Court does not find that an award of attorney’s fees

is warranted in this case. 

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Truesdell v. S. Cal. Permanente Med. Group, 293 F.3d 1146, 1152 (9th Cir. 2002).2

IV. Conclusion

 The Motion for Sanctions pursuant to Fed. R. Civ. P.11 filed by Defendants Matthias

Boldt and S.A.N. Nutrition Corp. (ECF No. 27) is DENIED. 

DATED: November 15, 2011

WILLIAM Q. HAYES

United States District Judge

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