Court Opinion

ID: 9378336
Source: CourtListenerOpinion
Date Created: 2023-03-10 01:00:50.472581+00
Date Added: 2024-06-11T17:17:20.442186
License: Public Domain

Case: 22-40057      Document: 00516671727         Page: 1    Date Filed: 03/09/2023

           United States Court of Appeals
                for the Fifth Circuit                                United States Court of Appeals
                                                                              Fifth Circuit

                                                                            FILED
                                                                        March 9, 2023
                                   No. 22-40057                        Lyle W. Cayce
                                                                            Clerk

   Frank Vaughan,

                                                            Plaintiff—Appellant,

   Michael Joseph Collins; William A. Brewer, III; Brewer
   Storefront, P.L.L.C.,

                                                                      Appellants,

                                       versus

   Lewisville Independent School District,

                                                            Defendant—Appellee.

                  Appeal from the United States District Court
                       for the Eastern District of Texas
                            USDC No. 4:19-CV-109

   Before Higginbotham, Duncan, and Engelhardt, Circuit Judges.
   Patrick E. Higginbotham, Circuit Judge:
          Frank Vaughan filed a lawsuit against Lewisville Independent School
   District (“LISD”) and seven school board members, alleging that the
   district’s at-large election system violated Section 2 of the Voting Rights Act
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                                     No. 22-40057

   (“VRA”) and seeking injunctive relief. 1 The district court determined that
   Vaughan lacked standing to bring his Section 2 claim because he is white. The
   district court then granted defendants’ motion for sanctions against
   Vaughan, his attorneys, and their law firm based on the findings that
   Vaughan’s lawsuit was frivolous under 52 U.S.C. § 10310(e) and his
   attorneys multiplied proceedings unreasonably and vexatiously under 28
   U.S.C. § 1927. Holding that Vaughan’s lawsuit did not merit sanctions, we
   VACATE the district court’s sanctions order and REMAND to determine
   the extent to which the order is footed upon specific contemptuous conduct
   in the attorneys’ prosecution of the case.
                                           I.
          Vaughan sued LISD and the school board members under Section 2
   of the VRA, claiming that the district’s at-large election system diluted the
   votes of non-white minorities within the district. Vaughan produced expert
   reports and planned to call five experts to testify to support his claim. As the
   school district and district court later seized upon, Vaughan did not state in
   his complaint that he is white and does not belong to any of the district’s
   racial minorities.
          In its motion for summary judgment, LISD argued that Vaughan
   lacked standing and failed to create a genuine issue of material fact under
   Section 2 of the VRA, as Vaughan “is not a member of any minority group
   he seeks to advocate for in his lawsuit (i.e., Asian, Black, or Hispanic); rather,
   Plaintiff is white.” LISD argued that Vaughan instead asserted third-party
   standing, and that the court should therefore dismiss his claim.

          1
              42 U.S.C. § 1973.

                                           2
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           Vaughan responded to LISD’s standing argument, contending that he
   had first-party standing as an “aggrieved person” under the VRA. In support
   of his first-party standing, Vaughan emphasized:

           The Gill decision 2 illustrates that standing to sue for vote
           dilution is an individual right, and to establish standing, the
           individual plaintiff must show he or she is a voter who resides in
           a district affected by vote dilution, which establishes plaintiff’s
           injury-in-fact. He has presented admissible evidence proving
           that he is a registered voter who resides within the boundaries
           of LISD and that LISD is affected by vote dilution. To prove
           his individual injury of a diluted vote is redressable, Plaintiff
           has presented [an expert’s] Illustrative District, which proves
           a single member district can be drawn within LISD wherein his
           vote would not be diluted. 3

   Arguing that he was an “aggrieved person” under the VRA, Vaughan stated
   that his status as a resident within a district where an at-large system operates
   to dilute his vote—impairing his ability to elect candidates of his choice in
   violation of the Voting Rights Act and Fourteenth and Fifteenth
   Amendments—gives him standing to sue on his own behalf and on behalf of
   all others whose votes were similarly diluted.
           The district court found these arguments unconvincing, granting
   LISD summary judgment on the standing issue because Vaughan was a white

           2
               Gill v. Whitford, 138 S. Ct. 1916 (2018).
           3
              Vaughan also alleged “that LISD’s at large electoral system denies equal voting
   opportunity to voters of color and many parents of children enrolled in LISD schools,
   thereby denying these residents, of which he is one, the opportunity to elect representatives
   of their choice in violation of the Voting Rights Act and the Fourteenth and Fifteenth
   Amendments to the Constitution.” He contended that he did not have “a fair opportunity
   to elect candidates of his choice and ensure that his voice, and the voices of his community,
   are factored into LISD’s decisions.”

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   voter and not a member of any of any of the minority groups discussed in his
   complaint. The VRA only applies to plaintiffs who have experienced race-
   based vote dilution, the court determined, and he therefore lacked standing
   to bring his claim. LISD moved for, and the district court granted, costs
   taxable under 28 U.S.C. § 1920.
           LISD next moved for punitive sanctions: award of attorney’s fees
   under 42 U.S.C. § 1988(b), (fee shifting provision for civil rights litigation),
   28 U.S.C. § 1927 (fee shifting provision for attorneys), and 52 U.S.C.
   § 10310(e) (the VRA’s fee-shifting provision for parties). The district court
   granted the motion. 4
           The court found that Vaughan’s claims were frivolous and
   unreasonable, determining that LISD was entitled to an award of attorney’s
   fees under § 10310(e). 5 The district court next considered § 1927, which
   provides that any attorney “who so multiplies the proceedings in any case
   unreasonably and vexatiously” may be liable for costs and fees. The court
   found attorney’s fees appropriate “because LISD has proven by clear and
   convincing evidence that Vaughan’s case was ‘unwarranted and should
   neither have been commenced or persisted in.’” The district court also
   assessed fees against Vaughan’s attorneys for irrelevant lines of questioning
   pursued during four depositions.
           Finally, the district court calculated the fees and held Vaughan, his
   attorneys, and their law firm jointly and severally liable for $49,498.25—

           4
             The court declined to decide whether § 1988(b) empowers a defendant to recover
   fees for a VRA claim, determining that Vaughan and his attorneys were liable under the
   other two statutes.
           5
             The district court relied on § 10310(e) instead of § 1988(b), concluding that it is
   unclear whether § 1988(b) applies to VRA cases and that § 10310(e) granted the district
   court the power to shift fees regardless.

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   roughly one-third of the fees LISD paid for its defense. Vaughan and his
   attorneys timely appealed, arguing that the district court abused its discretion
   in awarding the fees.
                                                 II.
           We review sanctions awards for abuse of discretion. 6 “A district court
   abuses its discretion if it awards sanctions based on an erroneous view of the
   law or on a clearly erroneous assessment of the evidence.” 7
                                                 III.
           We first consider the district court’s assessment of attorney’s fees
   under the VRA’s fee-shifting provision, § 10310(e). That statute provides for
   “the prevailing party” in a lawsuit to recover “a reasonable attorney’s fee,
   reasonable expert fees, and other reasonable litigation expenses as part of the
   costs.” 8 The VRA’s fee-shifting language is subject to the Supreme Court’s
   guidance in Christiansburg Garment Co. v. Equal Employment Opportunity
   Commission, however, which limits fee-shifting for prevailing defendants in
   civil rights cases to instances where the “the plaintiff’s action was frivolous,
   unreasonable, or without foundation, even though not brought in subjective
   bad faith.” 9
           In Christiansburg, the Equal Employment Opportunity Commission
   brought a lawsuit against a company under Title VII pursuant to a statutory

           6
               Procter & Gamble Co., 280 F.3d 519, 526 (5th Cir. 2002).
           7
               Walker v. City of Bogalusa, 168 F.3d 237, 240 (5th Cir. 1999).
           8
               52 U.S.C. § 10310(e).
           9
             434 U.S. 412, 421 (1978). See also Stenseth v. Greater Fort Worth & Tarrant Cnty.
   Cmty. Action Agency, 673 F.2d 842, 848 (5th Cir. 1982) (“It is clear from this and other
   similar cases that courts are reluctant to award attorney’s fees against plaintiffs undertaking
   to enforce their constitutional rights.”).

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   provision that allowed the Commission to sue in its own name for any charges
   pending with the agency when Congress passed the statute in 1972. 10 The
   Commission’s lawsuit was based on a complaint that was in fact no longer
   pending before the Commission, meaning that the agency had no grounds to
   bring the claim in federal court. 11 After dismissal, the defendant-employer
   moved for attorney’s fees, and the district court denied the motion in part
   because the Commission’s claim “was an issue of first impression requiring
   judicial resolution.” 12 The Supreme Court affirmed, explaining that district
   courts must avoid “the understandable temptation to engage in post hoc
   reasoning by concluding that, because a plaintiff did not ultimately prevail,
   his action must have been unreasonable or without foundation.” 13 “Even
   when the law or the facts appear questionable or unfavorable at the outset,”
   the Court continued, “a party may have an entirely reasonable ground for
   bringing suit.” 14 The central purpose of fee-shifting provisions in civil rights
   statutes, the Court later clarified, “is to vindicate the national policy against
   wrongful discrimination by encouraging victims to make the wrongdoers pay
   at law—assuring that the incentive to such suits will not be reduced by the
   prospect of attorney’s fees that consume the recovery.” 15 But this fee-
   shifting mechanism should not function to deter civil rights plaintiffs. 16

           10
                Christiansburg Garment Co., 434 U.S. at 414.
           11
                Id.
           12
                Id. at 423.
           13
                Id. at 421.
           14
              Id. at 422. “This kind of hindsight logic could discourage all but the most airtight
   claims, for seldom can a prospective plaintiff be sure of ultimate success.” Id.
           15
                Indep. Fed’n Flight Attendants v. Zipes, 491 U.S. 754, 761 (1989).
           16
              See, e.g., King v. Ill. State Bd. of Elections, 410 F.3d 404, 423 (7th Cir. 2005)
   (noting that “[a]ssessing attorneys’ fees against the plaintiffs in this case would work
   precisely the harm the Supreme Court warned about in Christiansburg Garment Co.;” that

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           We have provided further guidance on the meaning of “frivolous” in
   the context of Christiansburg. Fees are inappropriate when a civil rights
   plaintiff’s claim is “colorable and of arguable merit.” 17 A district court may
   consider a range of factors in its evaluation of the plaintiff’s claim, such as
   “whether the plaintiff established a prima facie case,” 18 whether “squarely
   controlling precedent” foreclosed the plaintiff’s legal argument, 19 whether
   the plaintiff’s evidence was so lacking that “there is no basis from which to
   say the[] claims were not frivolous,” 20 whether the defendant offered to
   settle, 21 and whether the plaintiff’s claim was so obviously meritless that it
   was dismissed prior to trial.22 When evaluating sanctions against a party, we

   is that “[f]uture civil rights plaintiffs would be deterred from bringing potentially
   meritorious claims, out of the fear that they would have to pay a defendant's legal fees if
   they could not establish their claim.”); see also S. Rep. No. 94–1011, at 5 (parties “seeking
   to enforce the rights” protected by civil rights legislation function as “private attorneys
   general” and “should not be deterred from . . . vindicat[ing] . . . fundamental rights . . . by
   the prospect of having to pay their opponent’s counsel fees should they lose”).
           17
             Vaughner v. Pulito, 804 F.2d 873, 878 (5th Cir. 1986) (citing Jones v. Tex. Tech
   Univ., 656 F.2d 1137, 1145 (5th Cir. 1981)).
           18
                United States v. Mississippi, 921 F.2d 604, 609 (5th Cir. 1991).
           19
                Jones, 656 F.2d at 1147; see also Christiansburg, 434 U.S. at 423.
           20
             Myers v. City of West Monroe, 211 F.3d 289, 293 (5th Cir. 2000); see also Vaughner,
   804 F.2d at 878 (citing presentation of “some credible evidence” as “tend[ing] to establish
   the colorable merit of the plaintiffs’ action”); White v. S. Park Indep. Sch. Dist., 693 F.2d
   1163, 1170 (5th Cir. 1982) (same).
           21
              Mississippi, 921 F.2d at 609. We have noted, however, that “whether a defendant
   offers to settle a case is of questionable value in determining whether the plaintiff’s claims
   are frivolous.” Myers, 211 F.3d at 292.
           22
              Id.; see also Myers, 211 F.3d at 293 (citing Hidden Oaks, Ltd. v. City of Austin, 138
   F.3d 1036, 1053 (5th Cir. 1998)) (noting that dismissal alone is insufficient to support a
   finding of frivolity). Appellees are correct that this court provided some factors for
   evaluating frivolity determinations in Mississippi, 921 F.2d at 609. Yet our precedent makes
   clear that district courts are not constrained to those three factors alone when evaluating
   the frivolous nature of a civil rights claim.

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   have also found pertinent whether parties advancing “controversial”
   theories make good-faith attempts to “extend the law.” 23 The relevance of
   these factors naturally varies based on whether the defect in the plaintiff’s
   case was legal or factual in nature.
          In Jones v. Texas Tech University, we determined that attorney’s fees
   were inappropriate where a civil rights plaintiff raised claims of “some
   arguable merit.” 24 In that case, parties to a civil rights lawsuit related to on-
   campus demonstrations entered into a consent agreement that waived all
   other claims in the matter. 25 The plaintiff nonetheless filed a subsequent
   lawsuit alleging that the university violated his due process rights during
   disciplinary matters raised in the original lawsuit’s complaint. 26 The district
   court concluded that res judicata applied and that no due process violation
   occurred regardless, finding the suit frivolous and granting the university
   attorney’s fees. 27 We reversed, reasoning that the plaintiff’s theory that res
   judicata did not apply because the first lawsuit was not brought in his personal
   capacity was “not entirely unreasonable or implausible.” 28 Regarding the
   due process claim, we concluded that “[i]n the absence of squarely
   controlling precedent, we cannot say that [the plaintiff’s] contention that the
   [university] violated his right to due process was frivolous.” 29

          23
               F.D.I.C. v. Calhoun, 34 F.3d 1291, 1298 (5th Cir. 1994).
          24
               656 F.2d at 1147.
          25
               Id. at 1140.
          26
               Id.
          27
               Id. at 1141.
          28
               Id. at 1146.
          29
               Id. at 1147.

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          In contrast, we affirmed a district court’s award of attorney’s fees in
   Myers v. City of West Monroe, where a civil rights plaintiff put forward “no
   evidence” to substantiate the claims raised in her complaint. 30 In that case,
   the plaintiff brought a § 1983 suit alleging that a police officer violated her
   Fourth Amendment rights by conducting an illegal stop and search of her
   vehicle. 31 The district court granted judgment as a matter of law for the
   officer and awarded attorney’s fees due to a “complete lack of evidence”
   substantiating the plaintiff’s claims. 32 We determined that the court was
   within its discretion to award fees because the plaintiff “put on no evidence”
   and “there [was] no basis from which to say these claims were not
   frivolous.” 33
          In this case, Vaughan argued that he had standing to bring a lawsuit
   under Section 2 of the VRA because he resided in a district affected by vote
   dilution, and this vote dilution occurred on the basis of race or color. In
   making this argument, Vaughan sought to extend Gill v. Whitford, a political
   gerrymandering case holding that dilution of an individual’s vote is a
   concrete harm when that individual lives in an affected district. 34 The district
   court rejected Vaughan’s attempt to extend the law.
          In its order granting attorney’s fees, the district court concluded that
   Vaughan’s claim did not constitute a cognizable injury, finding it “frivolous
   and unreasonable.” The court first determined that it “was not able to reach
   the issue of whether Vaughan established a prima facie case because he did

          30
               211 F.3d at 293.
          31
               Id. at 290.
          32
               Id. at 291.
          33
               Id. at 293.
          34
               138 S. Ct. 1916, 1929–30 (2018).

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   not establish standing, which is a foundational element of any claim.” The
   district court also found that “Vaughan did not even attempt to assert an
   injury in fact, he ignored well-settled case law regarding standing, and he
   made no credible arguments as to his ability to pursue his claims against
   LISD.” In addition, LISD did not offer to settle, and the case did not proceed
   to trial. Based on these observations, the district court found that LISD was
   entitled to an award of attorney’s fees under § 10310(e).
           We conclude that sanctions against Vaughan were unwarranted
   because precedent in this circuit did not squarely foreclose his legal argument
   and because he sought to extend existing law. Critically, LISD points to no
   precedent in this circuit considering whether a voter in his position has
   standing under the VRA, let alone “squarely controlling precedent.” 35 No
   court of appeals has considered this question, and we found only a single out-
   of-circuit district court opinion analyzing the issue. 36 Furthermore, Vaughan
   argued that a recent Supreme Court case supported his claim to a voting
   injury. His argument is not sanctionable simply because the district court
   concluded it was wrong, particularly given ongoing evolution in courts’ views
   on standing in redistricting cases. As the Supreme Court noted in
   Christiansburg, “[t]his kind of hindsight logic could discourage all but the
   most airtight claims.” 37 For these reasons, fee shifting in this civil rights case

           35
                Jones, 656 F.2d at 1147.
           36
             See Perry-Bey v. City of Norfolk, 678 F. Supp. 2d 348, 363 (E.D. Va. 2009)
   (dismissing the plaintiff’s claims because she made no allegation “that she is a member of
   a minority group and that her right to vote has been abridged on account of her race or
   color.”).
           37
                Christiansburg Garment Co., 434 U.S. at 422.

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   was inappropriate. 38 By vacating the sanction against Vaughan, we express
   no opinion on the correctness of his standing theory.
                                                 IV.
           We next consider the district court’s award of attorney’s fees against
   Vaughan’s counsel under § 1927. That statute provides:
           Any attorney or other person admitted to conduct cases in any
           court of the United States or any Territory thereof who so
           multiplies the proceedings in any case unreasonably and
           vexatiously may be required by the court to satisfy personally
           the excess costs, expenses, and attorneys’ fees reasonably
           incurred because of such conduct. 39
   A district court must find that the attorney’s multiplication of the
   proceedings was both “unreasonable” and “vexatious.” 40 The finding must
   be based on “evidence of bad faith, improper motive, or reckless disregard of
   the duty owed to the court.” 41 The district court may award “only those fees
   and costs associated with the persistent prosecution of a meritless claim.” 42
   The district court must also make detailed factual findings that “(1) identify

           38
              LISD claims that Vaughan forfeited his argument that his claim was not frivolous
   under § 10310(e). To avoid forfeiture, a “litigant must press and not merely intimate the
   argument during the proceedings before the district court. If an argument is not raised to
   such a degree that the district court has an opportunity to rule on it, we will not address it
   on appeal.” F.D.I.C. v. Mijalis, 15 F.3d 1314, 1327 (5th Cir. 1994). Vaughan pressed his
   claim to standing before the district court, and the district court had the opportunity to fully
   consider the matter. Having defended his position, an action that includes the implicit
   assertion that the position is meritorious, Vaughan did not forfeit the argument that his
   claim is not frivolous.
           39
                28 U.S.C. § 1927.
           40
                F.D.I.C. v. Conner, 20 F.3d 1376, 1384 (5th Cir. 1994).
           41
                Edwards v. Gen. Motors Corp., 153 F.3d 242, 246 (5th Cir. 1998).
           42
                Browning v. Kramer, 931 F.2d 340, 345–46 (5th Cir. 1991).

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   sanctionable conduct and distinguish it from the reasons for deciding the case
   on the merits, (2) link the sanctionable conduct to the size of the sanctions,
   and (3) differentiate between sanctions awarded under different statutes” to
   facilitate review on appeal. 43
            In addition, “[a] party that predicates its legal claim on a controversial
   and unsettled legal theory should not face sanctions under [§ 1927] when the
   court ultimately rejects the claim.” 44 Yet “[n]o multiplication of proceedings
   would be more vexatious than one which gave a frivolous claim the
   appearance of trial-worthy merit.” 45 “To prevent the courts from
   dampening the legitimate zeal of an attorney in representing her client, we
   have interpreted § 1927 as penal and construed it in favor of the sanctioned
   party.” 46 As such, sanctions under the statute are to be “sparingly
   applied.” 47 Fees may only be imposed against counsel, not parties. 48
            In this case, the district court awarded fees against Vaughan’s
   attorneys after finding that they unreasonably and vexatiously multiplied the
   proceedings by filing the action and pursued irrelevant lines of questioning
   during depositions. As Vaughan’s lawsuit was not frivolous and relied on an

            43
                 Procter & Gamble Co., 280 F.3d at 526.
            44
                 Id. at 531–32.
            45
                 Gonzalez v. Fresenius Med. Care N. Am., 689 F.3d 470, 481 (5th Cir. 2012).
            46
              Procter & Gamble Co., 280 F.3d at 526 (cleaned up and internal quotations and
   citations omitted).
            47
                 Laws. Title Ins. Corp. v. Doubletree Partners, L.P., 739 F.3d 848, 872 (5th Cir.
   2014).
            48
                 Procter & Gamble Co., 280 F.3d at 525.

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   “unsettled legal theory,” 49 his attorneys cannot be sanctioned under § 1927
   simply for filing the action.
          Vaughan’s attorneys nonetheless fail to convince this court that the
   district court abused its discretion in awarding fees for conduct during
   depositions. The attorneys questioned school board members on a range of
   topics that bear little relevance to a voting rights lawsuit, including a separate
   Title IX suit against the school district, claims of sexual harassment at a
   school, state standardized testing, mental health accommodations for
   students during standardized testing, and board members’ individual views
   on policy topics such as allowing teachers to carry guns on campus. Vaughan
   and his attorneys offer no theory of relevance to this court, noting only that
   LISD did not move to quash the depositions and made only form objections.
   While parties should resort to protective orders and attorney’s fees under
   Rule 30 of the Federal Rules of Civil Procedure as a first line of defense, 50
   this court has never held that failure to file a Rule 30 motion precludes later
   relief under § 1927 for unreasonable and vexatious multiplication of
   proceedings. The district court did not abuse its discretion in awarding fees
   LISD incurred for these depositions.
          On remand, the district court should identify “which, if any, excess
   costs, expenses, or attorney’s fees were incurred because” of the attorneys’
   unreasonable and vexatious multiplication of proceedings through irrelevant
   deposition topics. 51

          49
               Procter & Gamble Co., 280 F.3d at 531–32.
          50
               See, e.g., Batson v. Neal Spelce Assocs., Inc., 765 F.2d 511, 516–17 (5th Cir. 1985).
          51
               Browning, 931 F.2d at 345–46.

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                                                 V.
           Finally, Vaughan and his attorneys argue that § 1927 does not allow a
   district court to award attorney’s fees against law firms. We agree. The
   statute’s plain text provides for sanctions against “[a]ny attorney or other
   person admitted to conduct cases in any court of the United States or any
   Territory thereof.” 52 Courts do not admit law firms to conduct cases, but
   instead admit individual attorneys. We furthermore find the Seventh
   Circuit’s opinion in Clairborne v. Wisdom persuasive in its review of the
   statute’s text, the Supreme Court’s interpretation of an earlier version of
   Rule 11, and the specific inclusion of “law firms” in the revised version of
   Rule 11. 53 As such, we join the majority of our sister circuits in holding that
   § 1927 does not provide grounds for a district court to award attorney’s fees
   against law firms or other entities not admitted to practice law. 54 Like the
   Seventh Circuit, we decline to adopt the Eleventh Circuit’s viewpoint that
   § 1927 allows a district court to award attorney’s fees against law firms,
   finding no clear reasoning for doing so. 55

           52
                28 U.S.C. § 1927.
           53
                See 414 F.3d 715, 722–24 (7th Cir. 2005).
           54
              See, e.g., BDT Prod., Inc. v. Lexmark Int’l, Inc., 602 F.3d 742, 751 (6th Cir. 2010);
   Claiborne, 414 F.3d at 724 (“We conclude here only that § 1927 does not provide a legal
   basis for an order of fees against an entity like a law firm that is not itself ‘admitted to
   practice’ before the tribunal.”); Kaass L. v. Wells Fargo Bank, N.A., 799 F.3d 1290, 1295
   (9th Cir. 2015).
           55
              See Avirgan v. Hull, 932 F.2d 1572, 1582 (11th Cir. 1991) (relying on courts’
   inherent power to sanction bad faith conduct, rather than § 1927); Malautea v. Suzuki Motor
   Co., 987 F.2d 1536, 1544 (11th Cir. 1993) (misinterpreting Avirgan to allow for sanctions
   against law firms under § 1927); see also Claiborne, 414 F.3d at 723 (noting the disconnect).

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                                     ****
         We VACATE the district court’s sanctions order and REMAND to
   determine the extent to which the order is footed upon specific
   contemptuous conduct in the attorneys’ prosecution of the case.

                                       15