Court Opinion

ID: 812985
Source: CourtListenerOpinion
Date Created: 2012-12-03 19:31:27+00
Date Added: 2024-06-11T12:39:35.529235
License: Public Domain

Case: 11-14703     Date Filed: 12/03/2012   Page: 1 of 4

                                                             [DO NOT PUBLISH]

                IN THE UNITED STATES COURT OF APPEALS

                         FOR THE ELEVENTH CIRCUIT

                                   No. 11-14703

                       D. C. Docket No. 0:07-cv-61542-UU

JOSEPH C. HUBBARD,
individually and on behalf of all others
similarly situated, et al.,

                                                    Plaintiffs,

LABATON SUCHAROW LLP,
KESSLER TOPAZ MELTZER & CHECK LLP,

                                                    Interested Party-Appellees-
                                                    Cross-Appellants,

                                       versus

BANKATLANTIC BANCORP, INC.,
JAMES A. WHITE,
VALERIE C. TOALSON,
JARETT S. LEVAN,
ALAN B. LEVAN,
JOHN E. ABDO,

                                                    Defendants-Appellants-
                                                    Cross-Appellees.
               Case: 11-14703      Date Filed: 12/03/2012    Page: 2 of 4

                    Appeals from the United States District Court
                        for the Southern District of Florida

                                  (December 3, 2012)

Before DUBINA, Chief Judge, PRYOR and HILL, Circuit Judges.

PER CURIAM:

      This is a security fraud class action filed by Appellees State-Boston (Lead

Plaintiff) and other class members (collectively “Appellees/Cross-Appellants” or

“State-Boston”) against Appellants BankAtlantic Bancorp, Inc. and five senior

officers and/or chairmen of the company, James White, Valerie Toalson, Jarett

Levan, Alan Levan, and John Abdo (collectively “Appellants” or “Bancorp”).

After granting judgment as a matter of law in favor of Appellants,1 the district

court granted in part and denied in part Appellants’ motion for Rule 11 sanctions

as to allegations and claims contained in Appellees’ complaint and amended

complaint. Appellants challenge the denial of sanctions as to certain claims, and

Appellees cross appeal the grant of sanctions as to the remaining claim.

      The issues on appeal are:

      1
       This judgment was affirmed by the Eleventh Circuit on July 23, 2012. See Hubbard v.
BankAtlantic Bancorp, Inc., 688 F.3d 713 (11th Cir. 2012).

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               Case: 11-14703     Date Filed: 12/03/2012    Page: 3 of 4

      1. Whether the district court abused its discretion in denying Bancorp’s

motion for Rule 11 sanctions as to State-Boston’s confidential witness allegations?

      2. Whether the district court abused its discretion in denying Bancorp’s

motion for sanctions as to State-Boston’s claims of insider trading, accounting

fraud, and manipulated loan loss reserves?

      3. Whether the district court abused its discretion in denying Bancorp’s

motion for sanctions as to State-Boston’s claim of damages caused by securities

fraud where State-Boston’s expert, Candace Preston, did not attempt to

disaggregate the effect of other negative non-fraudulent information from the

stock price decline on October 26, 2007?

      The issue presented on the cross-appeal is:

      1. Whether the district court abused its discretion in granting Bancorp’s

motion for sanctions as to allegations made by State-Boston’s third confidential

witness, Donna Loverin?

      “We review a district court’s Rule 11 determinations for an abuse of

discretion.” CNA Fin. Corp. v. Brown, 162 F.3d 1334, 1338 (11th Cir. 1998). “A

district court would necessarily abuse its discretion if it based its ruling on an

erroneous view of the law or on a clearly erroneous assessment of the evidence.”

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               Case: 11-14703     Date Filed: 12/03/2012    Page: 4 of 4

Cooter & Gell v. Hartmarx Corp., 496 U.S. 384, 405, 110 S. Ct. 2447, 2461, 110

L. Ed. 2d 359 (1990).

      After reviewing the record, reading the parties’ briefs, and having the

benefit of oral argument, we first conclude that the district court did not abuse its

discretion when it rejected sanctions on all grounds raised by Bancorp’s appeal.

We conclude that Bancorp did not meet the high burden of showing that the

district court abused its discretion in finding that the allegations attributed to the

confidential witnesses were not sanctionable, that State-Boston’s claims for

insider trading, accounting fraud, and loss reserves were not sanctionable, and that

State-Boston’s claims for damages were not sanctionable. Likewise, on the cross-

appeal, we conclude from the record that State-Boston did not meet the high

burden of showing that the district court abused its discretion in finding that the

allegations related to CW3 Loverin were sanctionable.

      In conclusion, because we find no merit to any of the arguments made on

the appeal or cross-appeal, we affirm the district court’s judgment in all respects.

      AFFIRMED.

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