Source: https://law.justia.com/cases/federal/appellate-courts/F2/836/866/419832/
Timestamp: 2020-01-27 15:42:13
Document Index: 155084239

Matched Legal Cases: ['§ 1927', '§ 1927', '§ 1988', '§ 6673', '§ 1927', '§ 1291', '§ 1927', '§ 2000', '§ 1988', '§ 2072']

Patricia Thomas, et al., Plaintiffs-appellees, v. Capital Security Services, Inc., Defendant-appellant, 836 F.2d 866 (5th Cir. 1988) :: Justia
Justia › US Law › Case Law › Federal Courts › Courts of Appeals › Fifth Circuit › 1988 › Patricia Thomas, et al., Plaintiffs-appellees, v. Capital Security Services, Inc., Defendant-appella...
Patricia Thomas, et al., Plaintiffs-appellees, v. Capital Security Services, Inc., Defendant-appellant, 836 F.2d 866 (5th Cir. 1988)
US Court of Appeals for the Fifth Circuit - 836 F.2d 866 (5th Cir. 1988) Jan. 21, 1988
Ultimately, Capital prevailed on the merits of the litigation after a three day bench trial. As the facts regarding the disposition of the main litigation are accurately set forth by the panel opinion, they are not reiterated at this time. Thomas v. Capital Security Systems, Inc., 812 F.2d 984, 986 (5th Cir. 1987). However, we repeat, for purpose of clarity, that portion of the panel opinion discussing the disposition of Capital's subsequent motion for attorney's fees.
On June 10, 1986, the district court denied the motion. While denying the motion, the court noted that the situation presented a close question. Most of the court's discussion centered upon whether the plaintiffs and their attorneys had violated Fed. R. Civ. P. 11. The court noted that the broad or "shotgun" allegations contained in the plaintiffs' complaint appeared to evidence a lack of inquiry by the plaintiffs' attorneys into the law and supporting facts. The court, however, stated that it was reluctant to impose sanctions because of the unsettled nature of the law in regard to the breadth of a judicial complaint based upon a narrower EEOC complaint.
In recent years, Fed. R. Civ. P. 11 has generated extensive debate and controversy among legal scholars, jurists, and practitioners. Originally enacted in 1937, Rule 11, as amended in 1983, currently provides in pertinent part:
Fed. R. Civ. P. 11.1
Despite its laudable goals, Rule 11 was rarely applied before its amendment in 1983. Growing concern over misuse and abuse of the litigation process prompted rulemakers to amend Rule 11 in 1983 to reduce the reluctance of courts to impose sanctions by emphasizing the responsibilities of attorneys and reinforcing those obligations through the imposition of sanctions. Fed. R. Civ. P. 11 advisory committee notes.2 Former Rule 11 provided that an attorney's signature acted as a certificate by the attorney "that to the best of his knowledge, information, and belief there is good ground to support [the motion]," and the standard by which to assess attorney conduct for Rule 11 purposes was a subjective good faith standard, contemplating sanctions only when there was a showing of bad faith on the part of the attorney. Amended Rule 11 changed the rule by requiring that the attorney's certification must be formed "after reasonable inquiry," thereby defining a standard of reasonableness under the circumstances by which to measure attorney conduct.
As a threshold matter, the appropriate standard of review to utilize when assessing a district court's ruling on Rule 11 sanctions must be determined. Rule 11 provides that if a paper is signed in violation of the rule, "the court ... shall impose ... an appropriate sanction...." Fed. R. Civ. P. 11. The rule itself does not set forth a specific standard of review for Rule 11 decisions; however, the Advisory Committee recognized the necessity of retaining discretion for such decisions in the district court when it pronounced,
Fed. R. Civ. P. 11 advisory committee notes.
In this regard, one line of authority in this Circuit established a single abuse of discretion standard to be applied across-the-board to all of the issues ruled on in Rule 11 cases. In Davis v. Veslan Enterprises, 765 F.2d 494 (5th Cir. 1985), we stated, " [i]n determining whether the district court erred in imposing such sanctions, this Court's review is limited to determining whether the district court abused its discretion." Id. at 498. See also Bell v. Bell, slip. op. at 2179 (5th Cir. Sept. 17, 1986); Southern Leasing Partners, Ltd. v. McMullan, 801 F.2d 783, 788 (5th Cir. 1986).
However, in a recent decision, Robinson v. National Cash Register Co., 808 F.2d 1119 (5th Cir. 1987), this Circuit appeared to depart from its previous application of the abuse of discretion standard and opted instead for a more demanding, differentiated standard of review encompassing three tiers of analysis.
Additionally, the Court in Robinson placed great emphasis on the mandatory language of Rule 11 which provides that " [i]f a pleading, motion, or other paper is signed in violation of [Rule 11], the court ... shall impose ... an appropriate sanction ..." reasoning that such mandatory language dictated de novo review. Fed. R. Civ. P. 11 (emphasis added). In conformity with the Robinson opinion, the panel in the instant case also applied the three-tiered differentiated standard of review to the district court's denial of sanctions.
There is also a divergence of opinion among the circuits as to the proper standard of review to be applied to Rule 11 decisions by district courts. The Ninth Circuit established the three-tiered analysis adopted in Robinson. Zaldivar v. City of Los Angeles, 780 F.2d 823, 828 (9th Cir. 1986). See also Brown v. Federation of State Medical Boards, 830 F.2d 1429, 1434 (7th Cir. 1987). Other circuits apply a variation of the three-tiered analysis espoused in Zaldivar, utilizing an abuse of discretion standard when reviewing the factual reasons for imposing Rule 11 sanctions and the amount and type of sanctions, while reserving a de novo analysis for reviewing the legal sufficiency of a pleading or motion and the determination to impose sanctions. See Donaldson v. Clark, 819 F.2d 1551, 1556 (11th Cir. 1987) (en banc); Westmoreland v. CBS, 770 F.2d 1168, 1175 (D.C. Cir. 1985); Eastway Construction Corp. v. City of New York, 762 F.2d 243, 254 n. 7 (2d Cir. 1985), cert. denied, --- U.S. ----, 108 S. Ct. 269, 98 L. Ed. 2d 226 (1987).5 Still others have employed the across-the-board abuse of discretion standard. See O'Connell v. Champion International Corp., 812 F.2d 393, 395 (8th Cir. 1987); EBI, Inc. v. Gator Industries, Inc., 807 F.2d 1, 6 (1st Cir. 1986); Cotner v. Hopkins, 795 F.2d 900, 903 (10th Cir. 1986); Stevens v. Lawyers Mutual Liability Ins. Co., 789 F.2d 1056, 1060 (4th Cir. 1986); Lieb v. Topstone Industries, Inc., 788 F.2d 151, 157 (3d Cir. 1986).
We likewise believe that the imposition or denial of sanctions of necessity involves a fact-intensive inquiry into the circumstances surrounding the activity alleged to be a violation of Rule 11. The perspective of a district court is singular. The trial judge is in the best position to review the factual circumstances and render an informed judgment as he is intimately involved with the case, the litigants, and the attorneys on a daily basis. We can perceive of no advantage that would result if this Court were to conduct a second-hand review of the facts from the trial court level, as "the district court will have a better grasp of what is acceptable trial-level practice among litigating members of the bar than will appellate judges." Eastway Construction Corp. v. City of New York, 637 F. Supp. 558, 566 (E.D.N.Y. 1986).7
While sympathizing with the concerns that prompted previous panels in our Circuit to hold to the contrary, we depart from language in the instant panel's opinion and earlier decisions by this Court that impose upon an attorney a continuing obligation under Rule 11. Instead, we believe that a construction of Rule 11 which evaluates an attorney's conduct at the time a "pleading, motion, or other paper" is signed is consistent with the intent of the rulemakers and the plain meaning of the language contained in the rule. Like a snapshot, Rule 11 review focuses upon the instant when the picture is taken--when the signature is placed on the document. Rule 11 was promulgated for a particular purpose--to check abuses in the signing of pleadings. Fed. R. Civ. P. 11 advisory committee notes.
Our interpretation of Rule 11 finds support in the fact that Rule 11 has as its primary focal point the certification made by an attorney that he has complied with the affirmative duties imposed by the rule at the moment he affixes his signature to a pleading, motion, or other paper in a lawsuit. The rule itself is titled "Signing of Pleadings, Motions, and Other Papers; Sanctions." (Emphasis added). Furthermore, the express language of Rule 11 provides that " [t]he signature of an attorney or party constitutes a certificate by the signer that" he has complied with the obligations imposed by Rule 11. Fed. R. Civ. P. 11 (emphasis added). In addressing this issue, the Second Circuit reached a similar conclusion, stating
Oliveri v. Thompson, 803 F.2d 1265, 1274 (2d Cir. 1986), cert. denied, --- U.S. ----, 107 S. Ct. 1373, 94 L. Ed. 2d 689 (1987).10
Moreover, the advisory committee notes to the amended rule support our conclusion that Rule 11 applies only to the signing of pleadings and imposes a standard of good faith and reasonable investigation as of the date of that signing. Specifically, the committee notes provide that " [t]he court is expected to avoid using the wisdom of hindsight and should test the signer's conduct by inquiring what was reasonable to believe at the time the pleading, motion, or other paper was submitted." Fed. R. Civ. P. 11 advisory committee notes. The rulemakers later comment that in considering the nature and severity of the sanction to be imposed under Rule 11, the court should consider the state of mind of the attorney "when the pleading or other paper was signed." Id.
Ample protection from the use of abusive tactics in litigation in respects other than the signing of papers is provided by other rules governing attorney conduct. For instance, section 1927 imposes a continuing obligation on attorneys by prohibiting the persistent prosecution of a meritless claim.12 Discovery papers are regulated by Rule 26(g), and affidavits accompanying motions for summary judgment are governed by Rule 56(g). Finally, pursuant to its inherent power, a district court may award reasonable attorney's fees to the prevailing party when the losing party has acted in bad faith in actions that led to the lawsuit or in the conduct of the litigation. See Hall v. Cole, 412 U.S. 1, 15, 93 S. Ct. 1943, 1951, 36 L. Ed. 2d 702 (1973); Batson, 805 F.2d at 550.
Rule 11 provides that " [i]f a pleading, motion, or other paper is signed in violation of this rule, the court, upon motion or upon its own initiative, shall impose ... an appropriate sanction...." Fed. R. Civ. P. 11 (emphasis added). In Bell v. Bell, a panel of this Court found no abuse of discretion on the part of the district court in finding no sanction as the appropriate sanction for a Rule 11 violation. The Bell Court stated " [w]e are not constrained to say that the district court must, upon the establishment of a violation of the rules at issue here, impose some sort of sanction however nominal." Id. at 2178 (footnote omitted). Subsequent to the Bell decision, in Robinson, another panel of this Circuit found that where a district court determines an attorney's conduct to be violative of Rule 11, that court must then fashion an appropriate sanction in accordance with the dictates of Rule 11. Robinson, 808 F.2d at 1130-31. We adopt the Robinson rule. There are no longer any "free passes" for attorneys and litigants who violate Rule 11. Once a violation of Rule 11 is established, the rule mandates the application of sanctions. This appears to be the only construction consistent with the plain language of the rule.
When Rule 11 was amended in 1983 to include the mandatory "shall" language regarding the imposition of sanctions, the rulemakers inserted such language in an attempt to combat the reluctance of judges to impose sanctions on their fellow professionals. This reluctance on the part of the judiciary to impose sanctions has been explained as stemming from judges' sympathy, as former practitioners, for the pressures on lawyers in the adversarial system, concern that available sanctions would punish the client, and uncertainty as to whether judges could impose sanctions on their own initiative. Nelken, Sanctions Under Amended Federal Rule 11--Some "Chilling" Problems in the Struggle Between Compensation and Punishment, 74 Geo. L.J. 1313, 1321-22 (1986).14 One commentator notes " [b]y making sanctions mandatory, the drafters of rule 11 sought to discourage any collegial inclination to overlook or minimize violations" and to "maximize the deterrent effect of sanctions." Id. at 1322. The drafters of the amended rule employed mandatory language, thereby declining to afford district courts the discretion to conclude that sanctions are unwarranted and to deny them. In contrast, under 28 U.S.C. § 1927 and the court's inherent powers, the court enjoys such discretion.15
In concluding that Rule 11 requires the imposition of sanctions once a violation has been found, however, we stress that the district court is vested with considerable discretion in determining the "appropriate" sanction to impose upon the violating party. Rule 11 explicitly authorizes such discretion in the district court by containing the word "appropriate" in the language of the rule. While attorneys' fees and reasonable expenses are expressly provided for by the rule as appropriate sanctions, the court possesses the discretion to tailor sanctions to the particular facts of the case. Fed. R. Civ. P. 11 advisory committee notes. "Once a violation of Rule 11 has been found, sanctions are mandatory. Judges, however, have broad discretion in choosing the appropriate penalty...." Cavanagh, Developing Standards Under Amended Rule 11 of the Federal Rules of Civil Procedure, 14 Hofstra L.Rev. 499, 500 (1986).
An examination of the history behind the 1983 amendments to Rule 11 indicates that the rulemakers inserted the discretionary language in Rule 11 in response to concerns that mandatory sanctions would chill the adversarial process. The advisory committee notes expressly disclaim any intent to chill an attorney's enthusiasm or creativity in pursuing factual or legal theories.16 At the hearings on the 1983 amendments to Rule 11, Judge Mansfield, the Advisory Committee Chair, answered such concerns by stating that a judge would have discretion to impose a "de minimis" sanction. Hearings on Proposed Amendments to the Federal Rules of Civil Procedure, Advisory Committee on Civil Rules (Washington, D.C. Oct. 16, 1981) (unpublished transcript on file at Georgetown Law Journal) . Thus, it can be inferred that the broad discretion given district courts in determining sanctions was intended as a "safety valve" to reduce the pressure of mandatory sanctions.
While monetary sanctions are appropriate under Rule 11, it is noted that this Court has previously held that the basic principle governing the choice of sanctions is that the least severe sanction adequate to serve the purpose should be imposed. Boazman v. Economics Laboratory, Inc., 537 F.2d 210, 212-13 (5th Cir. 1976). See also Reizakis v. Loy, 490 F.2d 1132, 1136 (4th Cir. 1974); Industrial Building Materials, Inc. v. Interchemical Corp., 437 F.2d 1336, 1339 (9th Cir. 1970). We specifically adopt the principle that the sanction imposed should be the least severe sanction adequate to the purpose of Rule 11. Therefore, as a less severe alternative to monetary sanctions, district courts may choose to admonish or reprimand attorneys who violate Rule 11. In suggesting these as viable alternatives to monetary sanctions, we agree with Judge Schwarzer's comments cautioning trial judges not to forget the impact of such criticism.
Schwarzer, 104 F.R.D. at 201-02. In an innovative approach, one district court required the errant attorney to circulate the court's opinion criticizing his conduct throughout his firm. Heuttig & Schromm, Inc. v. Landscape Contractors Council, 582 F. Supp. 1519 (N.D. Cal. 1984), aff'd, 790 F.2d 1421 (9th Cir. 1986). The educational effect of sanctions might be enhanced even by requiring some form of legal education.
Rule 11 specifically permits the district court to order a party who violates Rule 11 to pay his opponent "the reasonable expenses incurred because of the filing of the pleading, motion, or other paper, including a reasonable attorney's fee." Fed. R. Civ. P. 11 (emphasis added). Therefore, according to the express language of Rule 11, in those cases in which such sanctions are imposed, the expenses reimbursed must(1) be found to have been caused by a violation of Rule 11, and
What constitutes "reasonable expenses" and a "reasonable attorney's fee" within the context of Rule 11 must be considered in tandem with the rule's goals of deterrence, punishment, and compensation. In this respect, we note "reasonable" does not necessarily mean actual expenses. INVST Financial Group v. Chem-Nuclear Systems, 815 F.2d 391, 404 (6th Cir.), cert. denied, --- U.S. ----, 108 S. Ct. 291, 98 L. Ed. 2d 251 (1987). See also In re TCI Ltd., 769 F.2d 441, 448-49 (7th Cir. 1985); United Food & Commercial Workers v. Armour and Co., 106 F.R.D. 345, 349 (1985). One district court has characterized the relevant policy concerns underlying Rule 11 as follows:
On the other hand, rule 11 only authorizes "reasonable" fees, not necessarily actual fees. Thus, " [t]he assessment of fees against a nonprevailing litigant must be fair and reasonable based upon the particular circumstances of the case."
Similarly, an attorney may not remain idle after a "motion, pleading, or other paper" filed in violation of Rule 11 by his opponent has come to his attention. The advisory committee notes stress that " [a] party seeking sanctions should give notice to the court and the offending party promptly upon discovering a basis for doing so." Fed. R. Civ. P. 11 advisory committee notes (emphasis added). In the same manner that a failure to mitigate expenses may result in a corresponding reduction in the amount of attorney's fees and costs awarded, so also may a failure to provide prompt notice of an alleged violation to the court and the offending party reduce the ultimate award. Donaldson, 819 F.2d at 1560. Prompt notice of Rule 11 violations conserves judicial time and energy, as well as monetary resources, while at the same time deterring future violations. At least one district court has characterized a party's duty to mitigate damages and provide notice as one encompassing a duty to use the least expensive method to resolve the dispute, stating
Our Circuit has previously recognized the importance of prompt action by litigants in Rule 11 cases. In Trevino v. Holly Sugar Corp., 811 F.2d 896 (5th Cir. 1987), this Court affirmed the district court's denial of Rule 11 sanctions against the plaintiff when the defendant, in July 1985, had challenged all of the plaintiff's claims as frivolous from the inception of the suit in April 1983. Id. at 908. The district court declined to impose sanctions, holding that the Rule 11 request for sanctions based on the filing of the plaintiff's motions was not timely. In affirming the district court's ruling, this Court implicitly condemned using Rule 11 to challenge generally all papers filed in a lawsuit at the termination of a proceeding. See also Stevens, 789 F.2d at 1061 (District court did not abuse its discretion in denying sanctions motion filed in untimely manner and when purpose of belated request was more retaliatory than substantive in nature.). Parties should not be allowed to "run up" exorbitant fees and expenses when responding to papers filed in violation of Rule 11; nor should litigants or courts remain idle in the face of possible violations. To allow such behavior would effectively transform Rule 11 from a shield to a sword, whereby guileful practitioners could profit from the misfortunes and mistakes of fellow professionals.
Our discussion presupposes that when a court's primary purpose in imposing sanctions is to deter, not to compensate, a determination of the "reasonableness" of fees and expenses does not necessarily depend on the steps taken to mitigate those expenses by the Rule 11 movant. Rather, the relevant considerations become the conduct and resources of the party to be sanctioned. See Nelken, 74 Geo. L.J. at 1336. However, it is precept that sanctions must be imposed within a time frame that has a nexus to the behavior sought to be deterred. This nexus becomes particularly important when a court imposes sanctions against a litigant on its own initiative. Sanctions assessed by courts should not amount to an "accumulation of all perceived misconduct, from filing through trial," resulting in a "single post-judgment retribution in the form of a massive sanctions award." In re Yagman, 796 F.2d 1165, 1183 (9th Cir. 1986), cert. denied, --- U.S. ----, 108 S. Ct. 450, 98 L. Ed. 2d 390 (1987).
We recognize that the drafters of Rule 11 contemplated that, in the case of pleadings, the sanctions issue normally will be determined at the end of the litigation. Fed. R. Civ. P. 11 advisory committee notes. Thus, by our opinion today, we do not mean to imply that withholding a sanctions decision until the end of trial is in all instances inappropriate. "The particular format to be followed should depend on the circumstances of the situation and the severity of the sanction under consideration." Id. For instance, a determination of whether or not a pleading is well grounded in law and fact may not be feasible until after an evidentiary hearing on a motion for summary judgment or even after the parties have presented their case at trial. Indeed, even if the information available to one side may seem to indicate that the other's position is not well founded, the former is nonetheless ordinarily entitled to assume, unless and until the contrary is unmistakably apparent, that his opponent is acting reasonably and in good faith; and, of course, the trial court may likewise so assume. Additionally, a judge is not obliged to raise the sanctions issue initially before applying sanctions sua sponte. Nevertheless, where a complaint or other paper is obviously defective within the context of Rule 11, we join with the Ninth Circuit in concluding that a court should at a minimum notify the individual certifying the document that Rule 11 sanctions will be assessed at the end of trial if appropriate. In re Yagman, 796 F.2d at 1184. Such early notice will warn a certifying individual that he may be exposed to substantial sanctions should he persist in his offensive conduct, as well as prevent unsuspecting parties from suffering a large punitive award at the end of the proceedings.
At least one circuit has already expressly rejected our panel's language requiring evidentiary findings and explanations every time a party seeks sanctions under Rule 11. Szabo Food Service, Inc. v. Canteen Corp., 823 F.2d 1073, 1084 (7th Cir. 1987) (en banc), petition for cert. filed, (Nov. 20, 1987). However, the Szabo court stopped short of adopting a rule that would excuse specific explanations for Rule 11 decisions in all cases. Focusing on the severity of the sanctions imposed in a particular case, the Seventh Circuit stated,
Fed. R. Civ. P. 11, 28 U.S.C. (West 1960).
Chief Justice Warren Burger, in his 1976 keynote address to the Pound Conference, expressed concerns that the legal profession was permitting abuse and misuse in the litigation process, stating " [c]orrect or not, there is also a widespread feeling that the legal profession and judges are overly tolerant of lawyers who exploit the inherently contentious aspects of the adversary system to their own private advantage at public expense." Address by Chief Justice Warren Burger, Agenda for 2000 A.D.--Need for Systematic Anticipation, National Conference on the Causes of Popular Dissatisfaction with the Administration of Justice (April 7-9, 1976) (conference commemorating Roscoe Pound's address to American Bar Association in 1906 Annual Meeting), reprinted in 70 F.R.D. 79, 91 (1976)
In addition to Rule 11, several other statutory and procedural provisions exist whereby a court may deter litigation abuse. For instance, 28 U.S.C. § 1927 permits a court to assess against an attorney who so multiplies the proceedings in any case unreasonably and vexatiously the excess costs, expenses, and attorney's fees incurred as a result of such conduct. Further, Fed. R. Civ. P. 37 provides generally for sanctions against parties or persons unjustifiably resisting discovery. In civil rights actions, a court, in its discretion, may award the prevailing party a reasonable attorney's fee as part of the costs pursuant to 42 U.S.C. § 1988
Furthermore, as previously noted, Rules 16 and 26 deter abuse in litigation by providing procedures for effective judicial management of pretrial and discovery. Finally, under its inherent power, a district court may award to the prevailing party reasonable attorney's fees upon a showing that an attorney has acted in bad faith, vexatiously, wantonly, or for oppressive reasons. Batson v. Neal Spelce Associates, 805 F.2d 546, 550 (5th Cir. 1986).
In addition to district courts, appellate courts may also impose sanctions in the form of single or double costs against an appellant who brings a frivolous appeal. Fed. R. App. P. 38. Tax courts also possess the power to deter abuse by imposing damages, not to exceed $5,000.00, against taxpayers who have asserted a frivolous or baseless claim, or have filed a claim only for purposes of delay. 26 U.S.C. § 6673.
But see Adams v. Pan American World Airways, Inc., 828 F.2d 24, 32 (D.C. Cir. 1987) where the court refused to overturn a district court's denial of sanctions stating that "we may overturn [the district court's] ruling only if it abused its 'wide discretion ' to determine whether grounds exist to support Rule 11 sanctions." (emphasis added)
In O'Connell, 812 F.2d at 395, the court stated " [r]ule 11 makes sanctions mandatory when a violation of the Rule occurs, but whether a violation has occurred is a matter for the court to determine, and this determination involves matters of judgment and degree."
The Eighth Circuit has recognized that a proper determination in Rule 11 cases "rests upon and is informed by the District Court's intimate familiarity with the case, parties, and counsel, a familiarity we cannot have. Such a determination deserves substantial deference from a reviewing court." O'Connell, 812 F.2d at 395. Indeed, one panel in our Circuit has characterized the three-tiered analysis of Thomas as more intrusive than the abuse of discretion standard. Shivangi v. Dean Witter Reynolds, Inc., 825 F.2d 885, 891 (5th Cir. 1987)
This Court previously stated that " [parties] are not required by Rule 11 or Sec. 1927 to voluntarily dismiss their claims once they decide not to pursue the claims. It is enough that they do not oppose [another party's] efforts to secure summary dismissal of the claims." Jackson Marine Corp. v. Harvey Barge Repair, Inc., 794 F.2d 989, 992 (5th Cir. 1986). Under the continuing obligation rule established by Robinson and followed by our panel's decision, an attorney, upon discovering that a good faith basis for a document no longer exists, must take the necessary actions to ensure that the proceedings do not continue without a reasonable basis in law and fact. Robinson, 808 F.2d at 1127. Thus, the continuing obligation of an attorney under Rule 11 has gradually evolved from a passive obligation of nonresistance to an active duty requiring a litigant to withdraw a once valid, but now frivolous and baseless claim
See also Hamer v. County of Lake, 819 F.2d 1362, 1370 n. 15 (7th Cir. 1987) (reiterating rule that Rule 11 does not impose a continuing obligation on attorneys to reevaluate the merits of the case as the litigation develops); Pantry Queen Foods, Inc. v. Lifschultz Fast Freight, Inc., 809 F.2d 451, 454 (7th Cir. 1987) (holding Rule 11 does not require revisions of pleadings to conform with newly discovered information); Golden Eagle Distrib. Corp. v. Burroughs Corp., 801 F.2d 1531, 1536 (9th Cir. 1986) (court must "look at the situation which existed when the paper was filed")
28 U.S.C. § 1927 provides in pertinent part:
The extent to which judges were reluctant to impose sanctions prior to the 1983 amendments to Rule 11 is evidenced by the fact that between 1938 and 1976, Rule 11 motions had been filed in only nineteen reported cases. Among those cases, violations were found in only eleven instances, and attorneys sanctioned in only three. S. Kassin, An Empirical Study of Rule 11 Sanctions 2 (Fed.Jud. Center 1985). Through 1979, there was only one additional reported opinion in which a sanction was imposed pursuant to Rule 11. Id. In contrast, after Rule 11 was amended in 1983, there were, between August 1, 1983 and August 1, 1985, more than 200 reported cases involving Rule 11 sanctions. Nelken, 74 Geo. L.J. at 1326 (1986)
See also Albright v. Upjohn Co., 788 F.2d 1217, 1222 (6th Cir. 1986) (Rule 11 expressly mandates the imposition of sanctions once a violation is found.); Westmoreland, 770 F.2d at 1174 (Under amended Federal Rule of Civil Procedure 11, however, the new provision that the court "shall impose" sanctions mandates the imposition of sanctions when warranted by groundless or abusive practices.).
The extent to which the Advisory Committee recognized the necessity of affording the district court broad discretion regarding the selection of sanctions is reflected by the numerous factors the committee notes set forth as appropriate circumstances to consider when imposing sanctions. For instance, the notes mention the district court's consideration of the status of a litigant as represented or pro se; the state of mind of an attorney when the paper was signed; the length of time an attorney has to investigate a claim or defense; and whether the sanction should be imposed on the attorney personally, the client, or both. The district court "retains the necessary flexibility to deal appropriately with violations of the rule." Fed. R. Civ. P. 11 advisory committee notes
Surely Rule 11 contemplates litigants viewing the duty to mitigate, not as a burden, but as a mechanism to deter future abuses by opponents in the same litigation and to promote the efficient disposition of the court's docket. By promptly notifying a party that he has violated Rule 11 and that sanctions will be sought, a party may obtain the voluntary dismissal or withdrawal of his opponent's claim or defense, or trigger appropriate settlement negotiations. Moreover, by putting an offending party on notice of defects in his paper, a litigant strengthens his case for sanctions should that party persist in a frivolous or baseless position. See Brownlow v. General Servs. Employees Union, 35 Empl.Prac.Dec. (CCH) p 34,886, at 35,896 (N.D. Ill. 1984) . "Under the duty to mitigate ... informal methods of dealing with frivolous complaints--common enough already among practicing attorneys--should be encouraged. When such efforts fail and the court ultimately finds dismissal to be warranted, the fact that the party seeking sanctions sought to resolve the dispute informally should bolster the claim for attorney's fees under rule 11." Nelken, 74 Geo. L.J. at 1336
In Cotner, the district court fined the plaintiff, an inmate at Oklahoma State Penitentiary, $1000 for engaging in successive and vexatious litigation, violating a previous court order, and violating Fed. R. Civ. P. 11. Furthermore, the district court barred the plaintiff from filing further actions until the fine was paid in full and placed restrictions on the commencement of future litigation by the plaintiff. Cotner, 795 F.2d at 902. In concluding that the district court had abused its discretion by imposing such a fine without affording the plaintiff appropriate procedural protections, the Tenth Circuit referred back to its previous opinion in Carter v. United States, 733 F.2d 735 (10th Cir. 1984), cert. denied, 469 U.S. 1161, 105 S. Ct. 915, 83 L. Ed. 2d 928 (1985), wherein the court had held that sanctions cannot result in total preclusion of access to the courts. Consistent with the Carter holding, the Cotner court stated with respect to sanctions, whose prepayment may have the effect of restricting future filings, that " [f]indings must be made to determine whether a litigant is able to make such payment so as to avoid an absolute preclusive effect on access to courts." Cotner, 795 F.2d at 903
We likewise believe that the imposition of sanctions must not result in total, or even significant, preclusion of access to the courts. We note that this Court has previously held that orders awarding Rule 11 sanctions prior to the entry of a dispositive order terminating the litigation are not final appealable orders for purposes of 28 U.S.C. § 1291. Click v. Abilene Nat'l Bank, 822 F.2d 544, 545 (5th Cir. 1987). However, if a district court imposes monetary sanctions that are made payable prior to the entry of a final appealable order, a litigant may suffer a substantial restriction on his access to the courts. Financially strapped because of the sanctions award, a litigant is unable to proceed with his case on the merits. To avoid this harsh, inequitable scenario, we conclude that if a litigant contends that a monetary sanction award precludes access to the court, the district judge must either (1) provide that the sanction is payable only at a date that coincides with or follows entry of a final order terminating the litigation; or (2) make express written findings, after a prompt hearing, as to why the award does not have such a preclusive effect. Such a rule would be consistent with our holding in Click and our determination today that any type of sanction, monetary or otherwise, should not result in preclusion of access to the courts
The panel also affirmed the district court's denial of Capital's request for attorney's fees under 28 U.S.C. § 1927 and 42 U.S.C. § 2000e-5(k). Thomas, 812 F.2d at 990. Recognizing that the standard of review for denial of attorney's fees under both statutory provisions is abuse of discretion, the panel correctly concluded that the district court did not abuse its discretion in denying Capital's request for attorney's fees under either provision and, discerning no error, we adopt the panel opinion in this regard. Additionally, we adopt that portion of the panel opinion declining to address Capital's claim under 42 U.S.C. § 1988, as the district court did not discuss that statutory basis for attorney's fees. Id. at 990 n. 3. On appeal, the plaintiffs also assert that Rule 11 violates the Rules Enabling Act, 28 U.S.C. § 2072. However, having failed to raise the argument in the trial court, plaintiffs may not do so on appeal. As an appellate court, we decline to entertain issues not raised in, or decided by district courts. Alberti v. Klevenhagen, 790 F.2d 1220, 1229 (5th Cir. 1986)