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Nature of Suit Code: 190
Nature of Suit: Other Contract Actions
Cause of Action: 

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PUBLISH FILED 

United States Court of App~ls 

UNITED STATES COURT OF APPEALS Tc:tth Circuit 

TENTH CIRCUIT 

RESOLUTION TRUST CORPORATION, as 

Receiver of Great Plains Federal 

Savings and Loan Association, 

Plaintiff, 

v. 

B. WAYNE DABNEY, an individual; 

VAN DYCK, HAYS, DABNEY, PULLINS, 

RIVAS & KINGSOLVER, P.C., a 

Professional Corporation, 

Defendants-Appellees. 

ROBERT E. CRADDOCK, JR.; TOM COLBERT; 

NEYSA L. DAY, 

Movants-Appellants. 

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OEC 2 2 1995 

PATRiCK FISHER Clerl~ 

No. 94-6170 

APPEAL FROM THE UNITED STATES DISTRICT COURT 

FOR THE WESTERN DISTRICT OF OKLAHOMA 

(D.C. No. CIV-93-598-C) 

Submitted on the briefs: 

Tom Colbert of Colbert & Associates, 

Robert E. Craddock, Jr. of Dyer, 

Tennessee, for Movants-Appellants. 

Oklahoma City, 

James & Taylor, 

Oklahoma, 

Memphis, 

Before TACHA and BARRETT, Circuit Judges, and BROWN,** Senior 

District Judge. 

**Honorable Wesley E. Brown, Senior District Judge, United States 

District Court for the District of Kansas, sitting by designation. 

Appellate Case: 94-6170 Document: 01019280374 Date Filed: 12/22/1995 Page: 1 
BROWN, District Judge. 

Attorneys for the Resolution Trust Corporation (RTC) I 

Robert E. Craddock, Jr., Tom Colbert, and Neysa L. Day, 

(collectively, RTC Counsel), appeal from the district court's 

order imposing sanctions against them personally for violating 

Fed. R. Civ. P. 26(g) and 28 U.S.C. § 1927.1 We have jurisdiction 

under 28 U.S.C. § 1291. We affirm the sanctions imposed on 

Craddock and Colbert, but vacate the sanction against Day for lack 

of procedural due process.2 

The RTC, as receiver for Great Plains Savings and Loan 

Association (Great Plains) , brought a breach of contract action 

against attorney B. Wayne Dabney, and his law firm, Van Dyck, 

Hays, Dabney, Pullins, Rivas & Kingsolver, P.C., (collectively, 

the defendants), asserting that the defendants improperly prepared 

a title opinion relied upon by Great Plains in making a loan to 

John Hudson, causing Great Plains' loan to Hudson to be unsecured. 

1 After the Appellant's brief was filed, the parties 

stipulated to a dismissal of the appeal "as to all matters except 

the imposition of sanctions against Appellants Robert Craddock, 

Tom Colbert, and Neysa Day." Agreed Order Correcting Stipulation 

to Dismiss, filed Nov. 8, 1994. Defendants have not filed a 

brief. 

2 After examining the briefs and appellate record, this panel 

has determined unanimously that oral argument would not materially 

assist the determination of this appeal. See Fed. R. App. P. 

34(a); lOth Cir. R. 34.1.9. The case is therefore ordered 

submitted without oral argument. 

2 

Appellate Case: 94-6170 Document: 01019280374 Date Filed: 12/22/1995 Page: 2 
A few weeks before trial, Colbert notified defendants that 

the RTC planned to call a witness, Gerald Mildfelt, whom Colbert 

had previously represented to defendants would not be called to 

testify. Appellant's App. Vol. I at 62-63, Vol. II at 303-04. As 

a result of the RTC's late change of plans, defendants were unable 

to take Mildfelt's deposition until two weeks prior to trial. 

During Mildfelt's deposition, Craddock instructed Mildfelt not to 

answer any questions unless Craddock allowed him to. Appellant's 

App. Vol II at 283. Craddock asserted that the questions asked by 

defendants might seek information protected by the work product 

privilege. The day after the deposition, Colbert issued a 

subpoena duces tecum ordering defendants to produce all the 500 

title examinations performed by Dabney since 1975. Appellant's 

App. Vol. I at 133, 138, 139-41. As a result of these actions, 

defendants filed a 

motion to quash the 

filed a motion 

deposition. 

motion to compel discovery and a separate 

In response, the RTC 

regarding Mildfelt's 

subpoena duces tecum. 

for protective order 

The district court granted the defendants' motion to compel 

and motion to quash, and denied the RTC's motion for protective 

order. The district court found that the positions taken by 

Craddock and Colbert in connection with these pleadings were not 

substantially justified and awarded defendants' attorney fees and 

expenses under Fed. R. Civ. P. 37(a) (4) for all activity related 

to these discovery disputes. 

The district court further found that Colbert violated 

Fed. R. Civ. P. 26(g) by signing the subpoena duces tecum and that 

3 

. . 

Appellate Case: 94-6170 Document: 01019280374 Date Filed: 12/22/1995 Page: 3 
Craddock violated 28 U.S.C. § 1927 by instructing Mildfelt not to 

answer questions during his deposition. The district court found 

that Craddock's and Colbert's actions were not consistent with the 

requirements of the Federal Rules of Civil Procedure or warranted 

by existing law. It found that Craddock's and Colbert's actions 

were interposed for the improper purposes of harassment, 

unnecessary delay, and to increase the cost of litigation by 

multiplying the proceedings unreasonably and vexatiously in 

violation of Fed. R. Civ. P. 26(g) and 28 U.S.C. § 1927. 

The district court then requested briefs from both parties 

addressing "any factors appropriate to the Court's determination 

of the amount of a proper sanction that will deter future 

misconduct." Appellants' Br., Tab 2 at 5. It indicated it would 

base its sanctions on the amount of time it had put into the 

discovery matter. Id. at 4-5, Appellant's App. Vol. II at 314-15. 

After consideration of these briefs, the district court imposed 

sanctions of $3,000 each against Colbert and Craddock. The 

district court also sanctioned Day, an in-house lawyer for the 

RTC, personally for $500 because she filed an affidavit stating 

she had instructed Craddock not to let Mildfelt answer questions 

that sought work product. The district court ordered all of these 

sanctions be paid to the clerk of the court. 

I. Sanctions Against Craddock 

Section 1927 provides that "[a]ny attorney who so 

multiplies the proceedings in any case unreasonably and 

vexatiously may be required by the court to satisfy personally the 

4 

Appellate Case: 94-6170 Document: 01019280374 Date Filed: 12/22/1995 Page: 4 
excess costs, expenses, 

because of such conduct." 

"for conduct that, 

and attorneys fees reasonably incurred 

Sanctions under § 1927 are appropriate 

viewed objectively, manifests either 

intentional or reckless disregard of the attorney's duties to the 

court." Braley v. Campbell, 832 F.2d 1504, 1512 (lOth Cir. 1987). 

We review the district court's decision to impose sanctions under 

§ 1927 under an abuse of discretion standard. Griffen v. City of 

Okla. City, 3 F.3d 336, 342 (lOth Cir. 1993). 

A. 

Craddock first contends the sanction against him for 

instructing Mildfelt not to answer questions during deposition was 

an abuse of discretion because his assertion of the work product 

privilege was proper. Mildfelt was an RTC investigator 

responsible for evaluating whether certain loans were properly 

underwritten by Great Plains. Craddock contends the questions he 

instructed Mildfelt not to answer sought information concerning 

the RTC Counsel's mental impressions, legal strategies and 

investigative methods with respect to their evaluation of 

potential claims against Great Plains' officers and directors. 

A party may instruct a deposition witness not to answer when 

necessary to preserve a privilege. Fed. R. Civ. P. 30(d} (1). The 

work product privilege protects against disclosure of the "mental 

impressions, conclusions, opinions, or legal theories of an 

attorney or other representative of a party concerning the 

litigation." Fed. R. Civ. P. 26 (b) (3). The party asserting a 

work product privilege as a bar to discovery must prove the 

5 

Appellate Case: 94-6170 Document: 01019280374 Date Filed: 12/22/1995 Page: 5 
doctrine is applicable. See Barclaysamerican Corp. v. Kane, 746 

F.2d 653, 656 (lOth Cir. 1984). A mere allegation that the work 

product doctrine applies is insufficient. See Peat, Marwick, 

Mitchell & Co. v. West, 748 F.2d 540, 542 (lOth Cir. 1984), cert. 

dismissed, 469 u.s. 1199 (1985). 

Because the work product doctrine is intended only to guard 

against divulging the attorney's strategies and legal impressions, 

it does not protect facts concerning the creation of work product 

or facts contained within work product. Feldman v Pioneer 

Petroleum, Inc., 87 F.R.D. 86, 89 (W.D. Okla. 1980). Thus, work 

product does not preclude inquiry into the mere fact of an 

investigation. 

Under the plain language of Fed. R. Civ. P. 30(d)(1), 

counsel may instruct a deponent not to answer only when necessary 

to preserve a privilege, to enforce a limitation on evidence 

directed by the court, or to suspend a deposition in order to 

present a motion under Fed. R. Civ. P. 30(d) (3). It is 

inappropriate to instruct a witness not to answer a question on 

the basis of relevance. Here, Craddock told defendants' counsel 

he wouldn't allow Mildfelt to testify about anything he did in his 

investigative process because the RTC was only tendering Mildfelt 

as a witness to testify about damages and document custody. 

Appellant's App. Vol. II at 282, 286. Before defendants' counsel 

even asked any questions about Mildfelt's investigation of loans, 

Craddock also told defendants' counsel, and warned Mildfelt, he 

would not allow any questions relating to any RTC investigation. 

Id. at 280-81. 

6 

Appellate Case: 94-6170 Document: 01019280374 Date Filed: 12/22/1995 Page: 6 
Craddock also instructed the witness not to answer any 

questions unless Craddock first allowed him to answer, making a 

blanket work product objection to an entire line of questioning. 

Id. at 283. Craddock instructed Mildfelt not to answer questions 

which clearly did not call for work product material, such as 

whether Mildfelt reviewed the Hudson loan to determine whether it 

was properly underwritten; whether Mildfelt determined if the 

Hudson loan had been properly underwritten; whether Great Plains' 

board of directors had approved the Hudson loan; what 

responsibilities a savings and loan president and lending officer 

have with respect to making loans; and the type of information a 

bank would want about a borrower before making a loan. Id. at 

283-84, 286-88. 

Craddock did not meet his burden of proving that each 

question he instructed Mildfelt not to answer called for work 

product. Even if Craddock believed some of the questions were 

protected by the work product doctrine, that does not excuse his 

blanket instruction not to answer or his instructions not to 

answer questions which did not seek work product material. 

Craddock relies, as he did at the deposition, upon a district 

court bench ruling in Resolution Trust Corporation v. Conner, 

No. CIV-92-506-R (W.D. Okla. July 9, 1993) (transcript of bench 

ruling on motion for protective order) 

assertion of the work product privilege. 

as support for his 

Although the district 

court in Conner did grant a limited protective order with respect 

to RTC investigators, it clearly does not support Craddock's 

assertion of the privilege in the Mildfelt deposition. The 

7 

Appellate Case: 94-6170 Document: 01019280374 Date Filed: 12/22/1995 Page: 7 
district court in Conner ruled the deposing counsel was "certainly 

free at the deposition to inquire about the scope of [the RTC 

investigators'] investigation." Appellants' Br. , Tab 12 at 14. 

It is precisely such factual inquiries that Craddock refused to 

permit Mildfelt to answer. Moreover, Craddock and Day admit they 

believed prior to the deposition, in reliance on Conner, that the 

work product privilege might foreclose certain lines of 

questioning. Thus, the proper procedure was to apply to the court 

for a pre-deposition protective order, as called for by the rules 

of civil procedure, and as was done in the Conner case. See 

Fed. R. Civ. P. 26(c). 

The record supports the district court's conclusion that 

Craddock's instructions not to answer were unjustified. 

Therefore, it was not an abuse of discretion to sanction Craddock. 

B. 

Craddock next contends the district court failed to identify 

the basis for the amount of the sanction it ordered paid to the 

court. Specifically he argues there could be no "excess costs" 

because the district court had already awarded defendants their 

attorney fees under Fed. R. Civ. P. 37(b). 

"When a court imposes sanctions under 28 U.S.C. § 1927 ... 

it must sufficiently express the basis for the sanctions imposed 

to identify the excess costs reasonably incurred by the party to 

whom they will be due." Braley, 832 F.2d at 1513. Specific 

findings allow the court to identify the costs arising from the 

objectionable conduct, afford the sanctioned party notice and an 

8 

Appellate Case: 94-6170 Document: 01019280374 Date Filed: 12/22/1995 Page: 8 
opportunity to respond, and permit an appellate court to review 

the district court's decision. Id. 

Here, the district court's final sanction order did not 

specify the basis of the amount of the sanction it ordered paid to 

the court. However, it is clear from its initial bench ruling and 

written order giving notice it would impose sanctions that it 

based the amount of the sanction on the time it spent on the 

discovery dispute. Appellant's Br., Tab 2, at 4; Appellant's App. 

Vol. II at 314-15. 

"Excess costs" recoverable under 28 U.S.C. § 1927 include 

only those enumerated in 28 U.S.C. § 1920, which lists the items 

that ordinarily may be taxed to a losing party. 

Inc., v. Piper, 447 U.S. 752, 757-61 (1980). 

§ 1920 include wasted judicial time as an 

Roadway E~ress, 

Neither § 1927 nor 

"excess cost." 

Therefore, sanctions under § 1927 cannot be based upon the court's 

time or upon wasted judicial resources. See Blue v. United States 

Dep't of Army, 914 F.2d 525, 548 (4th Cir. 1990), cert. denied, 

499 u.s. 959 (1991). 

Nevertheless, even if it were error for the district court to 

base its sanction under § 1927 on the time it spent on the 

discovery dispute, the sanction can be upheld under the court's 

inherent power to impose a variety of sanctions to regulate its 

docket, promote judicial efficiency and deter frivolous filings. 

See Chambers v. NASCO, Inc., 501 U.S. 32, 50 (1991) (recognizing 

the inherent power of courts to sanction conduct abusive of the 

judicial process and rejecting arguments that statutory 

sanctioning powers displace this inherent power); Jones v. Bank of 

9 

Appellate Case: 94-6170 Document: 01019280374 Date Filed: 12/22/1995 Page: 9 
Santa Fe (In re Courtesy Inns, Ltd.), 40 F.3d 1084, 1089 (lOth 

Cir. 1994) .3 

We recognized the court's inherent power to impose a sanction 

payable to the court in In re Baker, 744 F.2d 1438 (lOth Cir. 

1984) (in bane), cert. denied, 471 U.S. 1014 (1985). We noted that 

while "the cost of the court's inconvenience is [not] a precise 

measure to be routinely awarded in each and every case of 

unwarranted delay , we do not think that cognizance of the 

costs imposed upon the judicial system are irrelevant in 

determining the seriousness and extent of the sanction appropriate 

in particular cases." Id. at 1442. 

The district court gave notice to RTC Counsel that it 

intended to impose sanctions based upon the waste of judicial time 

and the cost to the taxpayer, thus giving them notice and an 

opportunity to respond. Its findings were adequate to enable this 

court to determine that the amount of the sanctions were based on 

the district court's estimate of the time it spent on the 

discovery disputes, thereby permitting meaningful appellate 

review. See Braley, 832 F.2d at 1513; see also Optyl Eyewear 

Fashion Int'l Corp. v. Style Cos., 760 F.2d 1045, 1051 (9th Cir. 

1985) (a district court's failure to make express findings does not 

require a remand if a complete understanding of the issues may be 

had from the record). Accordingly, the district court's sanction 

against Craddock was not an abuse of its discretion. 

3 We may affirm the district court's judgment on grounds not 

relied upon by the district court if supported by the record. In 

re Courtesy Inns, 40 F.3d at 1087. 

10 

Appellate Case: 94-6170 Document: 01019280374 Date Filed: 12/22/1995 Page: 10 
II. Sanction Against Day. 

Day contends the district court erred in imposing a sanction 

upon her because it failed to state any basis for the sanction. 

The district court stated that the sanction was imposed "by virtue 

of the admissions" in the affidavit she filed in response to the 

district court's order that it intended to impose sanctions. Day 

stated in her affidavit that she determined prior to Mildfelt's 

deposition that certain areas of inquiry could be protected by the 

work product privilege, that she was present at Mildfelt's 

deposition and that she requested Craddock to direct Mildfelt not 

to answer questions that would invade the work product privileges 

of the RTC. Appellant's App. Vol. 1 at 210-11. 

Although Day did not raise the issue, we conclude that the 

district court failed to provide her with adequate notice of the 

sanction. A party facing the possible assessment of costs, 

expenses or attorney fees has a due process right to notice that 

such sanctions are being considered by the court and a subsequent 

opportunity to respond. Braley, 832 F.2d 1514. An opportunity to 

be heard does not require an oral or evidentiary hearing on the 

issue; the opportunity to fully brief the issue is sufficient to 

satisfy due process requirements. White v. General Motors Corp., 

908 F.2d 675, 686 (lOth Cir. 1990), cert. denied, 498 U.S. 1069 

(1991). 

Here, Day was not the subject of the defendants' request for 

sanctions or the district court's original order finding 

Craddock's and Colbert's actions sanctionable. Craddock filed 

Day's affidavit with the court to demonstrate that his conduct at 

11 

Appellate Case: 94-6170 Document: 01019280374 Date Filed: 12/22/1995 Page: 11 
Mildfelt's deposition was at Day's instructions. In light of this 

response, the district court sua sponte sanctioned Day as well. 

Day had no prior notice that sanctions were being considered 

against her and therefore, she had no ability to respond prior to 

the imposition of sanctions. Accordingly, the district court 

erred in imposing a sanction against Day without affording her due 

process. See G.J.B. & Assoc .. Inc. v. Singleton, 913 F.2d 824, 

830 (lOth Cir. 1990) (district court's error in failing to provide 

party with required due process constituted an abuse of 

discretion, requiring remand) . On remand, the district court must 

afford Day with the requisite due process if the court intends to 

impose sanctions on Day. 

III. Sanctions Against Colbert 

Colbert contends the imposition of sanctions against him was 

an abuse of discretion because the subpoena duces tecum was 

permissibly issued under Fed. R. Civ. P. 45, which permits the 

issuance of a subpoena duces tecum compelling a person to produce 

documents in conjunction with a subpoena to appear at trial. We 

review the district court's imposition of sanctions under 

Fed. R. Civ. P. 26(g) for an abuse of discretion. Portales Nat'l 

Bank v. Smith (In re Byrd, Inc.), 927 F.2d 1135, 1137 (lOth Cir. 

19 91) . 

The district court found that the RTC's subpoena duces tecum 

sought discovery well after the deadline imposed by its scheduling 

order issued pursuant to Fed. R. Civ. P. 16. 

2 at 2-3; Appellant's App. Vol. II at 306. 

12 

Appellant's Br., Tab 

We cannot determine 

Appellate Case: 94-6170 Document: 01019280374 Date Filed: 12/22/1995 Page: 12 
whether the subpoena duces tecum violated the district court's 

discovery scheduling order because RTC Counsel did not include the 

order as part of the record on appeal. Accordingly, we must 

affirm the district court's conclusion that the subpoena duces 

tecum sought untimely discovery of documents which should have 

been obtained through the normal discovery process within the 

discovery deadlines imposed by the court's scheduling order. See 

Deines v. Vermeer Mfg. Co., 969 F.2d 977, 979-80 (lOth Cir. 

1992) (holding that this court must affirm if the record is 

insufficient to permit assessment of appellant's claims of error). 

We also cannot review Colbert's contention that the district 

court erred when it found the subpoena duces tecum sought 

documents previously requested by the RTC, a finding it took into 

consideration in imposing the sanction. The district court found 

the RTC had requested the same documents "back in October [1993] . 11 

Appellant's App. Vol. II at 306. Colbert contends this was error 

because the documents were not requested in its first request for 

production, which was the subject of a discovery dispute before 

the court in October 1993. Appellant's App. Vol. I at 23-29; Vol. 

II at 568. However, the district court docket report indicates 

the RTC also requested Dabney to produce documents at his 

deposition, which request was held in abeyance by the district 

court in October 1993. Appellant's App. Vol. II at 568. This 

document request was not made part of the record on appeal and we 

cannot determine whether it requested the same documents requested 

by the subpoena duces tecum. Accordingly, we must again assume 

the district court's finding was correct. 

13 

Appellate Case: 94-6170 Document: 01019280374 Date Filed: 12/22/1995 Page: 13 
Moreover, the district court did not abuse its discretion in 

concluding that the subpoena duces tecum was interposed for 

purposes of harassment, unnecessary delay and increase in the cost 

of litigation. Having reviewed the record, we conclude that the 

untimely request could only have been intended to harass 

defendants. Colbert's contention that he did not become aware of 

his need for the title examinations until after Dabney's 

deposition does not justify waiting three months, then requesting 

them on the eve of trial. Thus, we conclude the district court 

did not abuse its discretion in sanctioning Colbert. 

The judgment 

Western District of 

of the United 

Oklahoma is 

States District Court for the 

AFFIRMED as to Craddock and 

Colbert and REVERSED as to Day and REMANDED for further 

proceedings. 

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