UNITED STATES COURT OF APPEALS

FOR THE FIFTH CIRCUIT

_____________________

No. 94-30272

_____________________

TRAVELERS INSURANCE COMPANY,

Plaintiff-Appellee,

VERSUS

ST. JUDE HOSPITAL OF KENNER, LA., INC., ET AL.,

Defendants,

KENNETH C. FONTE,

Defendant-Appellant.

____________________________________________________

Appeal from the United States District Court

for the Eastern District of Louisiana

(CA-90-1983-I c/w 90-2601-I)

_____________________________________________________ (November 21, 1994)

Before HIGGINBOTHAM, JONES, and BARKSDALE, Circuit Judges.

RHESA HAWKINS BARKSDALE, Circuit Judge:

Kenneth C. Fonte, counsel for defendants, appeals the district

court's imposition of sanctions against him under 28 U.S.C. § 1927

(multiplying proceedings "unreasonably and vexatiously"). We

AFFIRM

.1 Defendants were the St. Jude Medical Office Building Limited

Partnership; St. Jude Hospital of Kenner, Louisiana, Inc. (SJH);

Liljeberg Enterprises, Inc. (LEI); Krown Drugs, Inc. (Krown); John

A. Liljeberg, Jr.; and Robert Liljeberg. SJH, Krown, and LEI are

related companies, each formed, owned and controlled by the

Liljebergs. Accordingly, references to the Liljebergs include not

only John and Robert Liljeberg, but also their entities.

2 Again, our court finds itself with another issue arising out

of the continuing disputes between John A. Liljeberg, Jr., and

Robert Liljeberg and Travelers. Today, we affirmed the denial of

the 60(b)(6) motions in this and two related actions. T ravelers

Ins. Co. v. Liljeberg Enters., Inc.

, Nos. 93-3832, 93-3833, 93-3891

(5th Cir. Nov. 21, 1994). (Oral argument for this appeal was

consolidated with that for the three appeals from the denial of the

60(b)(6) motions, as well as for the appeal from the judgment in

the third action.) We have also addressed the two related actions

in Travelers Ins. Co. v. Liljeberg Enters., Inc.

, 7 F.3d 1203 (5th

Cir. 1993), aff'g in part 799 F. Supp. 641 (E.D. La. 1992); and

Travelers Ins. Co. v. St. Jude Hosp. of Kenner, La., Inc.

, No. 93-

3731, slip op. 581 (5th Cir. Oct. 25, 1994).

- 2 - I.

More than a year a fter judgment for Travelers Insurance

Company (based on a jury verdict) was entered, see Travelers Ins.

Co. v. St. Jude Hosp. of Kenner, La., Inc.

, 21 F.3d 1107 (5th Cir.

1994) (No. 92-9579; unpublished), defendants (Liljebergs) 1 moved to

vacate it pursuant to Fed. R. Civ. P. 60(b)(6), claiming that,

because of his membership in The Bos ton Club of New Orleans and

other clubs, and other social contacts, the district judge had

violated 28 U.S.C. § 455(a) by failing to disqualify himself from

the underlying litigation, although he knew, or should have known,

that his impartiality might reasonably be questioned. 2 In denying

the 60(b)(6) motion, the district court awarded sanctions, to

include attorneys' fees, against Fonte, the Liljebergs' attorney,3 28 U.S.C. § 1927 provides:

Any attorney or other person admitted to

conduct cases in any court of the United States

... who so mult iples 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.

4 As noted, in two separate, but related, actions, the

Liljebergs filed similar 60(b)(6) motions. S ee Travelers

, Nos. 93-

3832, 93-3833, 93-3891 (5th Cir. Nov. 21, 1994). The district

court awarded costs and attorneys' fees under § 1927 in all three

instances; but this appeal concerns only the sanctions imposed in

this action. On September 9, 1994, the district court entered an

order in one of the related cases, quantifying the sanctions at

$740. Travelers Ins. Co. v. St. Jude Hosp. of Kenner, La., Inc.

, No. 93-0173 (E.D. La. Sept. 9, 1994).

- 3 - pur suant to 28 U.S.C. § 1927. 3 The district court subsequently

quantified the sanctions at $22,123.75. 4

II.

Fonte does not challenge the amount of sanctions, only their

imposition.

A.

B y order entered on December 1, 1993, the district court

amended it s denial of the 60(b)(6) motion to include attorneys'

fees as part of the § 1927 sanctions. The order did not state that

those sa nctions were against Fonte. After Travelers moved to

quantify the sanctions, the district court did so on March 30,

1994.

Fonte appealed only after the March order. Travelers suggests

that, because Fonte did not appeal from the December 1993 order

imposing sanctions, he can appeal only the amount , as set by the

March 1994 order. Fonte replies that the December 1993 order was5 It goes w ithout saying that, although the parties do not

address this issue dire ctly, we may address, s ua sponte

, the

question of our jurisdiction. O swalt v. Scripto, Inc.

, 616 F.2d

191, 192 (5th Cir. 1980).

- 4 - not directed "exclusively" to him; that only the March 1994 order

directing him to pay Travelers obligated him to pay the sanctions.

Unlike F ed. R. Civ. P. 11, § 1927 sanctions are, by the

section's plain terms, imposed only on offending attorneys; clients

may not be ordered to pay such awards. E.g.

, Browning v. Kramer

,

931 F.2d 340, 344 (5th Cir. 1991). Therefore, when the district

court referred solely to § 1927 in its December 1993 order,

sanctions were being imposed on Fonte, not the Liljebergs. This

rai ses, however, the issue of whether that order was appealable. 5

Although Fonte incurred sanctions under the December 1993 order,

their amount was not determined until the March 1994 order. Thus,

the December 1993 order was not an appealable order. S outhern

Travel Club, Inc. v. Carnival Air Lines, Inc. , 986 F.2d 125, 131

(5th Cir. 1993) ("an order awarding attorney's fees or costs is not

reviewable on appeal until the award is reduced to a sum certain").

Accordingly, we have jurisdiction to consider not only the amount,

but also the underlying imposition, of sanctions. (As noted, Fonte

does not challenge the former.)

B.

Because § 1927 sanctions are penal in nature, Monk v. Roadway

Express, Inc.

, 599 F.2d 1378, 1383 (5th Cir. 1979), aff'd in

relevant part sub nom. Roadway Express, Inc. v. Piper

, 447 U.S. 752

(1980), and i n order not to dampen the legitimate zeal of an6 The district court recognized that, in order to award § 1927

sanctions, Fonte's conduct must have unreasonably and vexatiously

multiplied the proceedings. S ee 28 U.S .C. § 1927. In its March

30, 1994 order, the district court gave the following reasons for

finding that Fonte had done so:

1) There is nothing whatsoever in the record

- 5 - attorney in representing his client, § 1927 is strictly construed.

Browning

, 931 F.2d at 344. Therefore, before imposing such

sanctions, a court must ensure that, pursuant to the plain terms of

§ 1927, the offending attorney's multiplication of the proceedings

was both "unreasonable" and "vexatious", Federal Deposit Ins. Corp.

v. Conner

, 20 F.3d 1376, 1384 (5th Cir. 1994); evidence of

recklessness, bad faith, or improper motive must be present. H ogue

v. Royse City, Tex. , 939 F.2d. 1249, 1256 (5th Cir. 1991).

Despite the strict limitations for imposing § 1927 sanctions,

their imposition and quantification are commi tted to the sound

discretion of the court imposing them; we review only for abuse of

that discretion. E .g.

, Topalian v. Ehrman

, 3 F.3d 931, 934 (5th

Cir. 1993); Trevino v. Holly Sugar Corp.

, 811 F.2d 896, 907-08 (5th

Cir. 1987). In sum, in reviewing the imposition of sanctions, we

do not substitute our judgment for that of the di strict court in

enforcing acceptable standards of conduct. T opalian

, 3 F.3d at

935.

1.

The district court did not abuse its discretion in finding

that the 60(b)(6) motion unreasonably and vexatiously multiplied

the proceedings. The court's findings upon which it based the

impos ition of sanctions are well grounded. 6 Additionally, theevidencing a lack of appearance of impartiality of

the judge.

2) This case was tried to a jury. During

voir dire there wa s no questioning as to club

membershi p by defense counsel, nor has there ever

been questioning as to club membership before this

Court.

3) The Motions were blatantly untimely,

filed almost a year after final amended judgment

was entered. Defendants' pleadings that the

judge's club membership was "secret" and discovered

only in July of 1993 was at the least patently

disingenuous. The judge's Boston Club membership

has been of public record si nce 1984, readily

discoverable by anyone who can read.

4) Furthermore, since the rendering of the

jury verdict and the amended judgment in this case,

defense counsel has badg ered the Court with these

various motions without basis in fact or law, in an

attempt to intimi d ate the Court and retard the

progress of the litigation. Significantly, so far

two def endants in this case have filed for

reorganization in bankruptcy court since entering

the amended judgment.

5) The Court interprets defend ants' filing

of The Motions to be a scurrilous v ariation on a

weak form of advocacy: wait until the case is lost

and post-trial motions are denied, then proceed to

question the impartiality of the Court, a lmost a

year after the amended judgment is re ndered, with

allegedly "newly discovered" information, in fact

available to the public for years. Moreover,

d efendants were not satisfied with an attempt to

impugn the integrity of the Court, but el ected to

malign by innuendo the character and

professionalism of two attorneys unrelated to the

trial of this case.

These findings reflect that the district court, by implication,

found evidence of bad faith and improper motive.

In his brief, instead of focusing on the issue and standard of

review, Fonte attempts primarily to reargue the merits of the

60(b)(6) motion and Judge Mentz's refusal to recuse himself. It

goes without saying that if the district court had erred in denying

the 60(b)(6) motion, its submission would naturally not have been

- 6 -unreasonable or vexatious. In light of the fact that the denial of

all three 60(b)(6) motions was before us in separate appeals, Fonte

could have stated this simple truism, and then moved on to the

merits of this appeal. Instead, as noted, he elected to inundate

his brief with arguments on the merits of the 60(b)(6) motions.

7 The March 1994 order supplemented the cour t's earlier order

denying the 60(b)(6) motion. The earlier order, which contained

findings included in the district court's calculus for determining

whether to impose sanctions, is an appendix to Travelers Ins. Co.

v. St. Jude Medical Office Bldg., Ltd. Partnership

, 843 F. Supp.

138, 155-58 (E.D. La. 1994).

- 7 - background and context of this litigation illuminate the district

court's experience in dealing with Fonte. 7

2.

Fonte maintains that the district court exceeded its authority

under § 1 927 by considering bankruptcy proceedings undertaken by

two Liljeberg ent ities. S ee note 6, supra (findings ¶ 4). In

Matter of Case

, 937 F.2d 1014 (5th Cir. 1991), we stated that §

1927

limits the court's sanction power to attorney's

actions which multiply the proceedings in the case

before the court. Section 1927 does not reach

con duct that cannot be construed as part of the

proceedings before the court issuing § 1927

sanctions.

Id. at 1023. Fonte's reliance upon Case is misplaced. There, we

prohibited the district court from awarding fees incurred in a

collateral state court proceeding. Here, the district court did

not award Travelers fees it may have incurred in the bankruptcy

proceed ings. The references to those proceedings contributed to

the district court's impli c it determination that the 60(b)(6)

motion was in bad faith, or undertaken with an improper motive.- 8 - 3.

Next, Fonte asserts that the 60(b)(6) motion did not protract

the appeal on the underlying judgment, see note 6, supra (district

court findings ¶ 4); and that, therefore, sanctions were not in

order. Needless to say, the motion "multiplie[d] the proceedings".

28 U.S.C. § 1927. Section 1927 is not limited to dilatory tactics;

the issue for the district court is whether counsel unreasonably

and vexatiously multiplied the proceedings.

4.

Fonte contends also t h at, before imposing sanctions, the

district court denied him notice and an opportunity to be heard,

thus denying him due process. S ee Roadway Express

, 447 U.S. at 767

("attorney's fees should not be assessed lightly or without fair

notice and an opportunity for a hearing on the record").

Despite his assertions, Fonte received notice that the court

was considering sanctions. Before requesting them, Travelers

notified Fonte by certified letter, w ith copy to the district

judge, that it considered the 60(b)(6) motion to be in violation of

both Fed. R. Civ. P. 11 and § 1927. And, in its opposition to the

60(b)(6) motion, Travelers requested sanctions. This satisfied the

notice requirements of due process. I n re Perry

, 918 F.2d 931, 935

(Fed. Cir. 1990), cert. denied

,

___ U.S.

___, 112 S. Ct. 49, 50

(1991).

Nor did the district court's failure to hold a hearing violate

Fonte's due process rights. "[T]he right to a hearing ... is

limited to cases where a hearing would assist the court in its- 9 -

decision." H ill v. Norfolk & W. Ry.

, 814 F.2d 1192, 1201 (7th Cir.

1987). "Where the sanctionable conduct occurred in the presence of

the court, there are no issues that a hearing could illuminate and

hence the hearing would be pointless." K apco Mfg. Co. v. C & O

Enters., Inc.

, 886 F.2d 1485, 1495 (7th Cir. 1989); accord Hill

,

814 F.2d at 1202. Fonte does not contend that any factual dispute

exists with respect to his actions for which § 1927 sanctions were

imposed; those actions appear in the record and briefs before the

district court. A hearing would not have developed or clarified §

1927 issues. Furthermore, by having presided over the underlying

action, as well as related actions, the district court was most

familiar with Fonte, the parties, and the litigatio n. S ee

Travelers Ins. Co. v. St. Jude Medical Office Bldg., Ltd.

Partnership , 843 F. Supp. 138, 156 n.6 (E.D. La. 1994). See also

United States v. Nesglo, Inc.

, 744 F.2d 887 (1st Cir. 1984)

("another factor that militates towards finding that a hearing was

unnecessary is the degree of familiarity the court had with the

parties and the litigation").

5.

Finally, Fonte maintains that the district court should have

employed Rule 11, not § 1927, thus entitling him to the Rule's

procedural safeguar ds. There is nothing in the sanctioning

provisions which mandates that a court must consider Rule 11 before

§ 1927. S ee Chambers v. NASCO, Inc

. , 501 U.S. 32, 50 (1991) (a

court is not forbidden from sanctioning bad-faith conduct under its

inherent powers simply because that conduct could also be8 T ravelers seeks appellate sanctions. We decline to impose

them.

- 10 - sanctioned under § 1927 or the Federal Rules of Civil Procedure).

The decision whether to use § 1927, or Rule 11, or both, is within

the discretion of the district court; no abuse of that discretion

is present. 8

III.

For the foregoing reasons, the district court's imposition of

sanctions, to include their amount, is

AFFIRMED

.