Court Opinion

ID: 194655
Source: CourtListenerOpinion
Date Created: 2011-02-07 02:22:03+00
Date Added: 2024-06-11T13:14:46.617562
License: Public Domain

April 1, 1993    [Opinion reissued as published.]

                  UNITED STATES COURT OF APPEALS
                      FOR THE FIRST CIRCUIT

                                             

No. 92-2151

                   CATHERINE M. JONES, ET AL.,

                     Plaintiffs, Appellants,

                                v.

                  WINNEPESAUKEE REALTY, ET AL.,

                      Defendants, Appellees.

                                             

           APPEAL FROM THE UNITED STATES DISTRICT COURT

                FOR THE DISTRICT OF NEW HAMPSHIRE

           [Hon. Norman H. Stahl, U.S. District Judge]
                                                     

                                             

                              Before

                      Selya, Circuit Judge,
                                          

                  Coffin, Senior Circuit Judge,
                                              

                    and Boudin, Circuit Judge.
                                             

                                             

     David A. Jones for appellants.
                   

                                             

                          March 12, 1993

                                             

          SELYA, Circuit  Judge.   In  this appeal,  a family  of
          SELYA, Circuit  Judge.
                               

disappointed plaintiffs asks us  to overturn the district court's

entry  of judgment on a counterclaim and to annul awards covering

attorneys'  fees and sanctions.   Finding no cognizable error, we

affirm.

I.  BACKGROUND

          In  early  1989,  Catherine   M.  Jones  and  her  son,

Alexander  T. Jones, filed suit to recover amounts allegedly owed

by Reid S. Littlefield  in consequence of Littlefield's agreement

to  rent a vacation home in Gilford, New Hampshire.  Littlefield,

through  counsel, answered the  complaint and  counterclaimed for

breach of contract,  assault, and  trespass.1  In  response to  a

pretrial  order, the  two  original plaintiffs  filed an  amended

complaint  in which they  joined David A. Jones,  an owner of the

property  and a signatory to the lease, as a co-plaintiff.2  Soon

thereafter, plaintiffs' attorney moved to withdraw from the case.

On  January 2,  1990,  the magistrate-judge  allowed the  motion.

From  that point forward, David  Jones served as  his own counsel

and at times represented his co-plaintiffs.

                    

     1Appellants' suit  named a myriad  of other defendants.   In
the  present  posture of  the case,  no  useful purpose  would be
served by furnishing details relevant to these persons and firms.

     2David Jones is Catherine's  husband and Alexander's father.
He  is also  an  attorney.    He  represents  the  appellants  in
connection with this appeal.   We note in passing  that, although
Alexander Jones is  listed in  the notice of  appeal, brief,  and
other documents as  an appellant, he  is seemingly unaffected  by
any  of the  orders  under review.    We, therefore,  ignore  his
presence  and treat Catherine and David Jones as if they were the
sole appellants.

                                2

          In April  1990, appellants withdrew most  of the causes

of  action originally  asserted against  Littlefield.   Buoyed by

this concession, Littlefield moved to dismiss on the  ground that

there was no longer a sufficient amount in controversy.  Although

the  court  denied  Littlefield's  motion  and  gave   appellants

permission  to  supplement their  pleadings,  appellants made  no

effort  to cure the perceived  deficiency.3  On  August 27, 1990,

the court dismissed their complaint.

          Claiming  that they  had never  received notice  of the

opportunity  to amend  their  pleadings, and  denying (despite  a

clear record to the contrary) that they had withdrawn their other

causes  of action,  appellants sought  and obtained  the district

court's agreement  to reconsider.   The  court withheld entry  of

judgment and set a reconsideration  hearing for January 7,  1991.

The  appellants did not attend.  Instead, they notified the court

a  week  beforehand  that  Catherine  Jones's  medical  condition

precluded travel from  Pennsylvania to New Hampshire.   The court

continued the  hearing until June 24,  1991.  On  that date, only

David Jones  appeared, claiming that a  daughter's sudden illness

prevented  his  wife's attendance.    The  court rescheduled  the

hearing  for April  6,  1992, but  warned  appellants that  their

failure to attend  on the new date  would result in dismissal  of

the complaint and, possibly, additional sanctions.

                    

     3We use the  term "perceived deficiency" advisedly.   As the
district  court  recognized,  the  amount  in   controversy,  for
purposes of  federal diversity jurisdiction, is  determined as of
the time the case is  first commenced.  See Klepper v.  First Am.
                                                                 
Bank, 916 F.2d 337, 340 (6th Cir. 1990).
    

                                3

          Notwithstanding  the  court's admonition,  no plaintiff

appeared on  April 6.   Appellants  did not  communicate directly

with the court but  sent a facsimile transmittal to  their former

attorney  explaining that illness  supposedly prevented them from

attending.  Its patience exhausted,  the district court acted  on

its  earlier dismissal of the complaint and entered judgment.  On

May   5,  1992,   the   court  denied   appellants'  motion   for

reconsideration  and, at  the  same  time, granted  Littlefield's

motion for entry  of a  default in respect  to the  counterclaim.

The court fixed  June 3, 1992 for  a dual-purpose hearing  (i) to

determine  damages  on the  counterclaim,  see  Fed. R.  Civ.  P.
                                              

55(b)(2), (d),  and (ii) to  consider the possible  imposition of

sanctions.  Although appellants  did not show up  for the June  3

hearing, the court received evidence and reserved decision.

          On  September 8,  1992, the  court awarded  Littlefield

$2,000  on  the  counterclaim's   assault  count,  dismissed  the

remaining counts of the counterclaim (finding Littlefield's proof

of  damages inadequate), awarded  Littlefield attorneys'  fees in

the  amount of  $6,338.80, and  fined Mr.  and Mrs.  Jones $5,000

apiece for  their consistent failure to  attend pretrial hearings

and  their bad faith in  conducting the litigation.   This appeal

followed.     

II.  DISCUSSION

          Having  studied the  record, we  conclude that  none of

appellants' contentions  merit  relief from  the  various  orders

entered  below.  In explaining why this is so, we comment briefly

                                4

on four of appellants' principal points.

                    A.  The Matter of Status.
                                            

          Throughout most  of  this litigation,  David Jones  has

characterized himself as an  "involuntary plaintiff."  On appeal,

he  maintains this  characterization, arguing  that, as  such, he

cannot be forced to pay sanctions.  We do not  think that Jones's

point is properly preserved.

          To be  sure, Jones is  an involuntary plaintiff  in the

sense that, on August 28, 1989, the magistrate-judge ordered  the

two  original plaintiffs to join him.  (Given his relationship to

the  property and  the  lease, he  was  a necessary,  perhaps  an

indispensable,  party,  see  Fed.  R.  Civ.  P.  19.)    However,
                           

subsequent to joinder, Jones made several personal appearances in

the case and also made a number of written submissions.  While he

styled himself at various times as an "involuntary plaintiff," he

never asked the district court to drop him as a party.  That ends

the matter.  In this  circuit, "it is a party's  first obligation

to  seek any relief that might fairly have been thought available

in the district court before seeking it on appeal."   Beaulieu v.
                                                              

United States  Internal Revenue Serv.,  865 F.2d 1351,  1352 (1st
                                     

Cir. 1989); accord  Dartmouth Rev. v. Dartmouth College, 889 F.2d
                                                       

13, 22 (1st Cir. 1989);  Aoude v. Mobil Oil Corp., 862  F.2d 890,
                                                 

896 (1st Cir. 1988).  Thus, here, neither the question of whether

it  was error for the magistrate-judge to direct that David Jones

be joined as  a plaintiff,  nor the related  question of  whether

                                5

Jones participated in the suit under unfair compulsion, is before

us.4

                  B. The Assessment of Damages.
                                               

          We next consider Catherine Jones's contention  that the

district court improperly assessed damages against her in the sum

of $2,000.  The  record discloses that, after entering  a default

on the  counterclaims, the  district court scheduled  a proof-of-

claim  hearing for June 3, 1992, directed Littlefield to submit a

full  accounting   of  his  damages  in   advance,  and  directed

appellants  to respond  to  this submission  before the  hearing.

Littlefield filed a written statement of damages and a supporting

memorandum.   The appellants filed nothing.   They also boycotted

the June  3  hearing.   In  contrast,  Littlefield  appeared  and

testified.  Based upon the evidence before it, the district court

awarded Littlefield $2,000 in  damages against Catherine Jones on

the assault counterclaim.

          Once the  entry of  a default establishes  the fact  of
                                                             

damage, the  trial judge,  sitting without  a jury in  a Rule  55

proceeding, has  considerable latitude in  determining the amount
                                                                 

of damages.  See Sony  Corp. v. Elm State Elecs., Inc.,  800 F.2d
                                                      

317,  321  (2d  Cir.   1986)  (reviewing  assessment  of  damages

following entry  of  default  for abuse  of  discretion).    This

standard dictates  the  result in  the  present situation.    The

                    

     4Moreover,  Jones seems  to have  been perfectly  willing to
reap  the benefits of party-plaintiff status.  In one motion that
he signed, Jones deemed  himself "entitled to all the  rights the
statutes  and/or  case law  afford  to  any  Party, voluntary  or
involuntary."  He cannot, of course, have it both ways.

                                6

district judge  determined that, notwithstanding the  default, he

should not rely merely on  unverified allegations to determine an

appropriate award of damages in a case not involving a liquidated

amount,  see, e.g.,  Dundee Cement Co. v. Howard  Pipe & Concrete
                                                                 

Prods., Inc., 722 F.2d 1319, 1323  (7th Cir. 1983); Byrd v. Keene
                                                                 

Corp.,  104 F.R.D.  10,  12  (E.D.  Pa.  1984),  and,  therefore,
     

convened an evidentiary hearing  to establish the quantum  of the

award.  See Al-Kazemi v. General  Acceptance & Inv. Corp., 633 F.
                                                         

Supp.  540, 542 (D.D.C. 1986);  Systems Indus., Inc.  v. Han, 105
                                                            

F.R.D. 72, 74-75 (E.D. Pa. 1985).

          Absent a  sum certain, the district  court, in arriving

at the award,  could do no more than rely  on the evidence before

it.  Through no fault of either the court or the counterclaimant,

the  evidence  produced  at   the  hearing  consisted  mainly  of

Littlefield's   statement  of   damages   and  sworn   testimony.

Reviewing this evidence to  the extent possible,5 we  perceive no

abuse  of discretion in a  $2,000 award.   Littlefield stated, by

affidavit, that Catherine Jones's  threats of violence caused him

to  experience fear of physical injury and mental distress.  Non-

economic  damages  for  apprehension,  emotional   distress,  and

psychic   injury  are   not  easily   computed   and,  therefore,

determinations of  this type  are extremely  fact-sensitive. See,
                                                                

                    

     5Appellants have prosecuted this appeal  without procuring a
transcript of the June 3 hearing.  They must, therefore, bear the
onus  of any uncertainties arising out of an incomplete record on
appeal.   See Real  v. Hogan,  828 F.2d 58,  60 (1st  Cir. 1987);
                            
United  States v. One Motor  Yacht Named Mercury,  527 F.2d 1112,
                                                
1113-14 (1st Cir. 1975).

                                7

e.g.,  Wagenmann  v. Adams,  829 F.2d  196,  216 (1st  Cir. 1987)
                          

(observing  that "there  is  no scientific  formula or  measuring

device  which can be  applied to place a  precise dollar value on

matters  such  as .  .  . fright,  anxiety,  . .  .  or emotional

scarring").   Bearing in  mind the  incomplete record,  see supra
                                                                 

note  5, the nature of the  alleged damages, the modest amount of

the  award, the  appellants'  failure to  submit any  information

whatever  at  or  before  the proof-of-claim  hearing,6  and  the

deferential  standard of  review, we  are powerless  to undo  the

award.     

                  C.  The Award of Counsel Fees.
                                               

          It  is  beyond serious  dispute  that  a federal  court

possesses inherent  power to  shift attorneys' fees  when parties

conduct  litigation in bad faith.   See Roadway  Express, Inc. v.
                                                              

Piper,  447  U.S. 752,  765-66  (1980)  (recognizing "bad  faith"
     

exception to  general rule that federal  courts cannot ordinarily

make fee-shifting  awards); Stefan  v. Laurenitis, 889  F.2d 363,
                                                 

370 (1st  Cir. 1989) (discussing district  court's inherent power

under Roadway doctrine); Peltier v. Peltier, 548 F.2d 1083,  1084
                                           

(1st Cir.  1977) (affirming award  of attorneys' fees);  see also
                                                                 

Chambers  v. NASCO,  Inc., 111  S. Ct.  2123, 2133 (1991).   This
                         

power  should  be  used  sparingly  and  reserved  for  egregious

circumstances.

                    

     6This eschewal is an appropriate consideration  on appellate
review of a damage award.  See, e.g., Knightsbridge Mktg. Servs.,
                                                                 
Inc.  v. Promociones  Y Proyectos,  728 F.2d  572, 575  (1st Cir.
                                 
1984).

                                8

          The district court, citing the "general non-cooperative

and often  contentious manner" in which  appellants conducted the

litigation,  as well  as offering  numerous examples  of untoward

practice,7  determined  that  the  appellants  had surpassed  the

threshold  of   egregiousness.    The  court   made  a  specific,

meticulously  detailed finding  of  bad faith  and exercised  its

discretion  to  shift the  burden  of Littlefield's  fees  to the

appellants.  We  have scrutinized  the record on  appeal and  are

satisfied  that, although  the  court's conclusion  of bad  faith

might not be  inevitable, it is plainly sustainable.  When, as in

this instance, there are  two plausible views of the  record, the

trial  court's adoption of one such  view cannot constitute clear

error.  See United States v. St. Cyr, 977 F.2d 698, 706 (1st Cir.
                                    

1992).  

          Once the court made a supportable finding of bad faith,

it then properly exercised  its discretion and shifted  the fees.

It  considered the essential factor  (bad faith), did  not add to

the  mix any improper factors, and made a plausible judgment call

in  weighing  the use  of  its  inherent  powers.   No  more  was

exigible.  See Independent Oil & Chem. Workers, Inc. v. Procter &
                                                                 

Gamble Mfg. Co., 864 F.2d 927, 929 (1st Cir.  1988).  In this age
               

of burgeoning litigation expense and overcrowded dockets, neither

a sued defendant  nor a busy trial judge  should have to tolerate

litigants'  repeated  efforts  to  stall  a  case,  harass  other

                    

     7We have  examined the  pleadings described in  the district
court's memorandum order.   Many of them are  patently frivolous.
Others seem to be riddled with demonstrably false allegations.

                                9

participants, and frustrate the  operation of the justice system.

See, e.g., Brockton Sav.  Bank v. Peat, Marwick, Mitchell  & Co.,
                                                                

771 F.2d  5,  12 (1st  Cir. 1985),  cert. denied,  475 U.S.  1018
                                                

(1986);  Peltier,  548 F.2d  at  1084.   The  court appropriately
                

invoked its inherent power.8

                 D.  The Imposition of Sanctions.
                                                

          We discern no abuse of discretion  in the lower court's

imposition  of monetary  sanctions on  Catherine Jones  and David

Jones, separately, pursuant  to its authority under  Fed. R. Civ.

P. 16(f).9

          Trial judges enjoy great latitude in carrying out case-

management functions.   In re  San Juan Dupont  Plaza Hotel  Fire
                                                                 

Litig., 859 F.2d  1007, 1019  (1st Cir. 1988).   When  confronted
      

with a party's defiance of  its management authority, a  district

court  is  necessarily  vested with  considerable  discretion  in

deciding whether to impose  sanctions on that party, and,  if so,

                    

     8In its  fee-shifting order,  the district court  relied, in
the alternative, on its power  under state law.  Because  we find
that  the court  had inherent  power to  award counsel  fees, see
                                                                 
supra,  we  need  not reach  the  question  of  whether, in  this
     
diversity case, New Hampshire  law also allowed for fee-shifting.
                                       
See Chambers, 111 S. Ct. at 2136-38 (explaining that fee-shifting
            
under  a  federal court's  inherent  power to  redress  bad faith
conduct  is a  matter  of vindicating  judicial authority,  not a
matter of substantive remedy, and is, therefore, permissible in a
diversity case whether or not authorized by state law).

     9The rule  authorizes a  district court to  impose sanctions
"as are just" against a party for, inter alia, failure  to obey a
                                             
scheduling  or  pretrial order,  or for  failure  to appear  at a
scheduling  or  pretrial conference.    Fed.  R. Civ.  P.  16(f).
Because  we conclude  that  the district  court properly  imposed
monetary sanctions under Rule  16(f), we take no view  of whether
the  sanctions were likewise  permissible in the  exercise of the
court's inherent power.

                                10

in  determining what form the  sanctions should take.   See Media
                                                                 

Duplication Servs.,  Ltd. v. HDG  Software, Inc., 928  F.2d 1228,
                                                

1238  (1st Cir.  1991).   Because sanctions  are well  within the

heartland of  the district  court's realm,  we review a  district

court's imposition of them only for manifest abuse of discretion.

See Velazquez-Rivera v. Sea-Land Serv., Inc., 920 F.2d 1072, 1075
                                            

(1st Cir.  1990); Brockton Sav. Bank,  771 F.2d at  12.  Although
                                    

such a deferential  approach does not confer carte  blanche power
                                                           

to the  district court,  see, e.g.,  Navarro-Ayala v.  Nunez, 968
                                                            

F.2d  1421, 1427  (1st Cir.  1992); Figueroa-Rodriguez  v. Lopez-
                                                                 

Rivera,  878   F.2d  1478,   1491  (1st  Cir.   1988),  litigants
      

"protesting an order in respect to sanctions bear[]  a formidable

burden  in attempting to convince  the court of  appeals that the

lower court  erred."  United States v. One 1987 BMW 325,     F.2d
                                                       

   ,      (1st Cir. 1993)  [No. 92-1827, slip  op. at 5];  accord
                                                                 

Spiller v. U.S.V. Lab., Inc., 842 F.2d 535, 537 (1st Cir. 1988).
                            

          The record supports an assessment  that, throughout the

course of  this  litigation, appellants  regularly  defied  court

orders  directing them  to attend  pretrial hearings,  e.g., both
                                                           

Catherine and David Jones failed  to appear at hearings scheduled

for  January  7, 1991,  April  6,  1992, and  June  3, 1992,  and

Catherine  Jones also failed to appear at a hearing scheduled for

June  24, 1991.   Although appellants  offered excuses  for these

episodes, they  offered no  irresistibly convincing reasons.   To

give one illustration, appellants tried to explain their absences

on  April 6  and  June 3,  1992,  by claiming  that,  despite all

                                11

indications  to  the contrary,  they  did not  receive  notice of

scheduled hearings.  The  district court disbelieved this excuse.

It was  entitled to do so.   See, e.g., Spiller, 842  F.2d at 537
                                               

(noting  plaintiff's "history  of  foot-dragging"  and  rejecting

similar excuse  in affirming dismissal of  plaintiff's action for

failure  to  comply  with   court  orders).    To  give   another

illustration, appellants continually  claimed illness (theirs  or

some  other  family  member's)   but  the  medical  records  they

eventually  proffered were  neither timely  filed nor  served, as

required, on opposing counsel; moreover, the records were by  and

large  too  vague to  satisfy  appellants'  burden.   Given  this

checkered pattern,  and given,  further, that the  district court

warned  appellants on  more than  one occasion  about  the likely

consequences of failure to  attend, we find that the  court acted

within its discretion in levying sanctions under Rule 16(f).  See
                                                                 

Goldman,  Antonetti, Ferraiuoli,  Axtmayer  &  Hertell v.  Medfit
                                                                 

Int'l, Inc.,     F.2d    ,     (1st Cir. 1993) [No. 92-1458, slip
           

op. at 12-14] (holding that a counterclaimant's unexcused failure

to attend two pretrial conferences after the court had threatened

sanctions  for  failure  to  attend warranted  dismissal  of  the

counterclaim under  Rule 16(f)); see  also Thibeault v.  Square D
                                                                 

Co., 960 F.2d 239,  246 (1st Cir. 1992) (noting that  totality of
   

circumstances for sanction purposes could include events in other

litigation).

          We  likewise  conclude  that  the  sanctions   are  not

excessive.   On  this point,  the  district court,  after  citing

                                12

appellants'  defiance  of two  orders  directing  them to  attend

pretrial  hearings  and  noting their  chronicled  propensity  to

engage in  similar behavior  in earlier proceedings,  stated that

the  sanctions it chose were  fashioned to "deter plaintiffs, and

other litigants, from engaging in the course of conduct displayed

throughout  this   litigation."10     Deterrence   is  a   widely

recognized  basis  for  determining  the  amount  of  a  monetary

sanction.  See Media Duplication, 928 F.2d at 1242 (approving use
                                

of monetary sanctions under Rule 16(f) as a means of deterring an

attorney's neglect of  scheduled proceedings); see also  Navarro-
                                                                 

Ayala,  968 F.2d at 1426-27 (discussing deterrence as a basis for
     

gauging  monetary sanctions under Rule 11).   Having reviewed the

district court's explanation of why it chose the precise sanction

amounts and  finding  that the  amounts are  "within the  minimum

range reasonably  required to deter the abusive behavior," id. at
                                                              

1427, we are constrained to conclude that the court below did not

overspill the banks of its discretion under Rule 16(f).

III.  CONCLUSION

          We  need go no further.11   In this  case, the district

judge exhibited  commendable patience.   In the end,  however, he

found that appellants consistently  defied explicit court  orders

directing   them  to   attend   pretrial   hearings      hearings

                    

     10In line with the court's goal of deterrence, the sanctions
are to be paid into the registry of the district court.

     11Appellants waived many other  assignments of error at oral
argument.   The rest are utterly lacking in merit and need not be
discussed.

                                13

necessitated, in the main, by their own absences and requests for

reconsideration of earlier rulings.  The judge also found (again,

supportably)  that appellants pelted the court  with a torrent of

idle   motions  and   submissions,  many   containing  scurrilous

allegations, serving no apparent purpose other than to harass the

court,  burden the defendant, and delay a resolution of the case.

Given  what  the  nisi  prius  roll reveals,  together  with  the
                             

district court's record-rooted finding that  appellants blatantly

disregarded the  federal courts'  authority to  manage litigation

through  reasonable  means,  there  is no  principled  basis  for

vacating the rulings complained of in this appeal.

          Affirmed.
                  

                                14