Opinion ID: 3012562
Heading Depth: 1
Heading Rank: 2

Heading: Malakoff's Conduct.

Text: Judge Walls rested the S 1927 sanctions upon the following conduct: (1) Malakoff's motion to recuse Judge Wolin; (2) Malakoff's criticism of the fee examiner; (3) _________________________________________________________________ 4. We state that a finding of bad faith is usually required under the court's inherent powers because we noted in Republic of Philippines v. Westinghouse Electric Corp., 43 F.3d 65, 74 n.11 that such sanctions do not always require a showing of bad faith. Thus, in Martin v. Brown, we were careful to note that [u]sually the inherent power that a district court retains to sanction attorneys also requires a finding of bad faith. 63 F.3d 1252 at 1265 (emphasis added). We need not dwell on when, if at all, a court may impose such sanctions without first finding bad faith because, as we discuss below, the district court here implicitly made such a finding, and that finding was not clearly erroneous. 7 Malakoff's releasing recusal motion papers to the press; (4) affidavits Malakoff filed in March of 1997; (5) Malakoff's demand for a keyword search of discovery documents provided by Prudential as well as a demand that Class Counsel provide him with charts summarizing evidence to be used at the fairness hearing; and (6) sanctions motions Malakoff filed under Rule 11 and S 1927. We will examine each of these in turn. (1). The Motion to Recuse. Malakoff filed a motion to recuse as an emergency motion on December 2, 1996. He alleged that Judge Wolin had improper ex parte communications with various people involved in the nationwide litigation, that Judge Wolin obstructed reasonable access to documents related to the fairness of the settlement and that Judge Wolin had shown partiality towards Prudential and towards the fairness of the settlement. App. at 833-859. Malakoff rested the motion primarily upon the charge that Judge Wolin had improper ex parte meetings with Prudential's President and counsel on August 12, 1996 at a settlement conference, and an October 16, 1996, on the record conference with certain state insurance regulators. Finally, Malakoff alleged that Judge Wolin had improperly attempted to influence a state court trial judge in a Pennsylvania state court case. Prudential and Class Counsel opposed the recusal motion. Judge Wolin set an expedited schedule for responses and scheduled a hearing on the motion for December 13, 1996. However, when Prudential and Class Counsel voiced their opposition, Malakoff demanded a delay of twenty days to reply. The District Court denied that request and held the hearing as scheduled. Judge Wolin denied the recusal motion after that hearing and argument on the motion. Malakoff then petitioned for a writ of mandamus which we denied. His mandamus papers reiterated the same arguments that we had rejected on appeal from the approval of the class settlement and fairness hearing. See 148 F.3d at 342-34. 8 In sanctioning Malakoff under S 1927, Judge Walls rejected Malakoff's contention that the recusal motion had a colorable basis in fact and was not filed in bad faith. Rather, Judge Walls concluded that Malakoff intentionally filed an unreasonable recusal motion. 63 F. Supp. 2d at 520. In his appeal to us, Malakoff has dropped most of the charges he had previously based his recusal motion on, including his charge that Judge Wolin had improper ex parte settlement communications with Prudential's President and counsel.5 Instead, he asserts that the following three bases for recusal demonstrate that his motion for recusal had a colorable basis and was not filed in bad faith. First, Malakoff alleges that Judge Wolin attempted to intervene on Prudential's behalf in a Pennsylvania state court case called Rutt v. Prudential. According to Malakoff, in a hearing in that case before the state court trial judge, Prudential's counsel, Hirshman, argued for the disqualification of a lawyer named Miller who represented the Rutts. According to Malakoff, Hirshman told the state trial judge that Judge Wolin had information for the court regarding Miller and that Judge Wolin is receptive to a discussion with Your Honor by telephone about his views. Malakoff's Br. at 13. Malakoff alleges that Hirsham told the state judge that Judge Wolin had information to share and suggested that the state judge call Judge Wolin. Id. at 13-14. The state court trial judge purportedly declined Hirshman's invitation, saying that it would be highly improper for him to contact Judge Wolin. Id . at 14. _________________________________________________________________ 5. The District Court correctly noted, the Manual for Complex Litigation acknowledges that federal judges may meet separately with parties for confidential settlement conferences. Finally, the Code of Judicial Conduct for United States Judges permits separate conversations with parties with the consent of counsel who are authorized to object. This Court concludes that any reasonable attorney would have understood that Judge Wolin could permissibly engage in ex parte communication in a complex class action such as In re Prudential. 63 F. Supp.2d at 520. The district court found that Malakoff waived entitlement to notice of, and opportunity to object to, such meetings because he had consented to ex parte communications relating to settlement long before he filed the recusal motion. Id. 9 According to Malakoff, the whole purpose of this contact with the state judge was delaying the trial of the Rutt case until after the nationwide settlement was approved. At the recusal hearing, Judge Wolin stated that he would have spoken to the state judge as a matter of courtesy, however, he categorically denied knowing the state judge ever attempting to contact him, or even caring about the outcome of the Rutt case. App. at 891-92. Nothing on this record contradicts Judge Wolin's assertion. To the contrary, Malakoff's own brief now belies his charge that Judge Wolin attempted to intervene, and affirms that what actually happened was that Prudential attorneys urged [the state trial judge] to contact Judge Wolin. Malakoff's Br. at 38. Therefore, Malakoff's charge was not based on