Opinion ID: 489317
Heading Depth: 2
Heading Rank: 2

Heading: Procedural protections comporting with due process

Text: 30 Attorneys and clients facing possible discipline under Rule 11 have interests qualifying for protection under the Due Process Clause of the Fifth Amendment. Procedural due process requires notice and an opportunity to be heard before any governmental deprivation of a property interest. Boddie v. Connecticut, 401 U.S. 371, 379, 91 S.Ct. 780, 786, 28 L.Ed.2d 113 (1971). Determining what process is due in a Rule 11 case simply requires an application of familiar principles of due process: the timing and content of the notice and the nature of the hearing will depend upon an evaluation of all the circumstances and an appropriate accommodation of the competing interests involved. See Goss v. Lopez, 419 U.S. 565, 578-79, 95 S.Ct. 729, 738, 42 L.Ed.2d 725 (1975). The very nature of due process negates any concept of inflexible procedures universally applicable to every imaginable situation. Cafeteria & Restaurant Workers Union v. McElroy, 367 U.S. 886, 895, 81 S.Ct. 1743, 1748, 6 L.Ed.2d 1230 (1961); see also Morrissey v. Brewer, 408 U.S. 471, 481, 92 S.Ct. 2593, 2600, 33 L.Ed.2d 484 (1972); Mathews v. Eldridge, 424 U.S. 319, 334, 96 S.Ct. 893, 902, 47 L.Ed.2d 18 (1976). No set rule can be stated to govern all Rule 11 cases; the standard is necessarily flexible to cover varying situations. The specific dictates of due process will be determined by the interaction of several factors. These factors include but are not limited to: the interests of attorneys and parties in having a specific sanction imposed only when justified; the risk of an erroneous imposition of sanctions under the procedures used and the probable value of additional notice and hearing; and the interests of the court in efficiently monitoring the use of the judicial system and the fiscal and administrative burdens that additional procedural requirements would entail. 8 Providing due process will ensure that Rule 11 will not be applied arbitrarily, that erroneous application of the rule will be minimized, and that creative legal arguments and vigorous advocacy will not be stifled. 31
32 Nothing in the text of Rule 11 or in the Advisory Committee Note indicates that due process requires a court to follow the procedures called for by Fed.R.Crim.P. 42(b) for criminal contempt proceedings before it can impose a monetary sanction pursuant to Rule 11. Both the note and policy considerations tend to the opposite conclusion. Although Rule 11 itself mandates no specific procedures to be followed when evaluating claims of Rule 11 violations, the note says explicitly that courts must to the extent possible limit the scope of the sanction proceedings to the record. Such language does not support a general requirement that the procedures of Fed.R.Crim.P. 42(b) be followed every time a court considers imposing a monetary sanction. 33 In Kleiner v. First National Bank of Atlanta we explicitly rejected the argument that the punitive character of a monetary sanction imposed in a judicial disciplinary proceeding fixes the proceeding as one of criminal contempt, requiring the right to jury trial and analogous criminal procedural rights. Kleiner, 751 F.2d at 1209-10. A violation of Rule 11 is fundamentally different from an infraction of criminal contempt and therefore warrants different sanction proceedings. 34 The bar bears a special administrative responsibility in the judicial process independent from the public at large. We frequently refer to attorneys as officers of the court. A monetary sanction for failure to carry out this special responsibility as an attorney differs from the more severe infractions of criminal contempt for which attorneys and members of the general public can become liable. The former is an unjustified failure to carry out an administrative responsibility as an officer of the court; the latter is an affront to the authority of the judge. 35 Miranda v. Southern Pacific Transp. Co., 710 F.2d 516, 519 (9th Cir.1983). The court's power to impose appropriate sanctions on attorneys practicing before it 'springs from a different source than does the power to punish for criminal contempt.'  Kleiner, 751 F.2d at 1209 (citations omitted). 18 U.S.C. Sec. 401 limits a court's criminal contempt power to three instances that are far narrower than the actions subject to sanction under Rule 11. Under Sec. 401 a court of the United States may punish for such contempt of its authority, and none other, as--(1) Misbehavior of any person in its presence or so near thereto as to obstruct the administration of justice; (2) Misbehavior of any of its officers in their official transactions; and (3) Disobedience or resistance to its lawful writ, process, order, rule, decree, or command. 9 36 The Supreme Court has pointed out that when evaluating what process is due there comes a point when the benefit of an additional safeguard to the individual affected by the government action, and to society in terms of increased assurance that the action is just, may be outweighed by the cost. Mathews, 424 U.S. at 348, 96 S.Ct. at 909. To uniformly require courts to follow Fed.R.Crim.P. 42(b) procedures whenever they contemplate imposing a monetary sanction would create just that situation. The major goals of Rule 11 are to rid the courts of meritless litigation and to reduce the growing cost and burdensomeness of civil litigation. It would be counterproductive if the rule itself were to cause an increase in unnecessary litigation by mandating extensive collateral procedures as prerequisites to the imposition of sanctions. The amendments to Rule 11 were intended to encourage judges to use the rule and to eliminate their reluctance to sanction lawyers who abuse the litigation process. Advisory Committee Note. The fear of spawning satellite litigation was one cause of the reluctance of judges to impose sanctions under the pre-amendment rule. If judges are required to engage in unnecessarily extensive hearings, and in effect conduct a second trial on every issue of sanctions and create the possibility of a jury trial for any monetary sanction however small, they will often refrain from imposing sanctions and the vitality of amended Rule 11 will be drained away. It is not necessary to follow the procedures required in criminal contempt proceedings in every case to insure that the imposition of a monetary sanction is justified; less extensive procedures will generally protect the individual interests involved without undermining Rule 11. 10
37 An elementary and fundamental requirement of due process in any proceeding which is to be accorded finality is notice reasonably calculated, under all the circumstances, to apprise interested parties of the pendency of the action and afford them an opportunity to present their objections. Mullane v. Central Hanover Trust Co., 339 U.S. 306, 314, 70 S.Ct. 652, 657, 94 L.Ed. 865 (1950). Due process requires that the attorney (or party where applicable) has fair notice of the possible imposition of Rule 11 sanctions and of the reasons for their imposition. The existence of Rule 11 itself constitutes a form of notice since the rule imposes an affirmative duty on an attorney to conduct a reasonable inquiry into the viability of a pleading before it is signed; an attorney could not assert that he or she had no notice or knowledge of the standards of conduct that the rule itself provides. 11 38 The responsibilities of the attorney are emphasized by the rule; since proof of bad faith is no longer required, the amended rule holds attorneys to a higher standard than did the prior version of Rule 11. If an attorney is said to have submitted a complaint without any basis in fact, Rule 11 alone should constitute sufficient notice of the attorney's responsibilities since the rule explicitly requires the attorney to certify that a complaint is well grounded in fact. On the other hand, questions of whether an attorney made a good faith argument under the law or whether an attorney interposed a pleading, motion, or other paper for an improper purpose are more ambiguous and may require more specific notice of the reasons for contemplating sanctions. If sanctions are proposed to be imposed on the client, due process will demand more specific notice because the client is likely unaware of the existence of Rule 11 and should be given the opportunity to prepare a defense. 39 An attorney or party should be given early notice that his or her conduct may warrant Rule 11 sanctions. Early notice can deter continuing violations, thereby saving monetary and judicial resources. Matter of Yagman, Brown and Fleischer v. Baden, 796 F.2d 1165, 1184 (9th Cir.), reh'g denied, 803 F.2d 1085 (1986). The Advisory Committee Note instructs a party seeking sanctions to give notice to the court and the offending party promptly upon discovering a basis for doing so; a failure to do so may result in a corresponding reduction in the amount of any costs and attorneys' fees awarded. 40 Notice can come from the party seeking sanctions, or from the court, or from both. We see no basis for requiring that in all instances notice be in writing and with the formality of pleadings. But to avoid misunderstanding and permit appellate review, the notice given, or evidence of the giving of notice, should be made a part of the record. 41 The accused must be given an opportunity to respond, orally or in writing as may be appropriate, to the invocation of Rule 11 and to justify his or her actions. Rule 11 does not require that a hearing separate from trial or other pretrial hearings be held on Rule 11 charges before sanctions can be imposed; indeed the Advisory Committee Note indicates that the contrary is preferable: 12 To assure that the efficiencies achieved through more effective operation of the pleading regimen will not be offset by the cost of satellite litigation over the imposition of sanctions, the court must to the extent possible limit the scope of the sanction proceedings to the record. Thus, discovery should be conducted only by leave of court, and then only in extraordinary circumstances. 42 Advisory Committee Note. Whether and to what extent additional hearing is required will vary depending upon the nature of the case. The Advisory Committee Note indicates some of the matters to be considered: (1) the circumstances in general; (2) the type and severity of the sanction under consideration; and (3) the judge's participation in the proceedings, the judge's knowledge of the facts, and whether there is need for further inquiry. The Advisory Committee Note observes that [i]n many situations the judge's participation in the proceedings provides him with full knowledge of the relevant facts and little further inquiry will be necessary. 13 43 When an attorney has failed to present necessary factual support for claims despite several opportunities to do so, for example, further hearing on the sanctions issue may well be not only unnecessary but also a waste of judicial resources. On the other hand, when a court is asked to resolve an issue of credibility or to determine whether a good faith argument can be made for the legal position taken, the risk of an erroneous imposition of sanctions under limited procedures and the probable value of additional hearing are likely to be greater. Prior opportunities to respond to Rule 11 charges will also influence the extent to which further hearing is necessary. 44 As mentioned by the Advisory Committee, the type and severity of the sanction are necessary elements in the calculus. The more serious the possible sanction both in absolute size and in relation to actual expenditures, the more process that will be due. 45 Some cautions are in order. Rule 11 does not change the liberal notice pleading regime of the federal courts or the requirement of Fed.R.Civ.P. 8, which demands only a short and plain statement of the claim. The rule does not require that pleadings allege all material facts or the exact articulation of the legal theories upon which the case will be based. The reasonable inquiry standard of Rule 11 does not preclude plaintiffs from establishing the merits of claims through discovery. Nor is Rule 11 intended to chill innovative theories and vigorous advocacy that bring about vital and positive changes in the law. The rule should not be used to deter potentially controversial or unpopular suits. It does not mean the end of doctrinal development, novel legal arguments, or cases of first impression. The Advisory Committee Note specifies that the rule is not intended to chill an attorney's enthusiasm or creativity in pursuing factual or legal theories. Nor does Rule 11 impinge upon the right of indigent criminal defendants to appointment of counsel, see Gideon v. Wainwright, 372 U.S. 335, 83 S.Ct. 792, 9 L.Ed.2d 733 (1963), and counsel's obligation to represent the client to the best of his or her abilities. 46 REVERSED.