Court Opinion

ID: 9961162
Source: CourtListenerOpinion
Date Created: 2024-04-18 00:01:08.461386+00
Date Added: 2024-06-11T08:20:21.303376
License: Public Domain

Case: 22-40383   Document: 194-1      Page: 1   Date Filed: 04/17/2024

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

                                                                    FILED
                         No. 22-40383                           April 17, 2024
                        ____________                           Lyle W. Cayce
                                                                    Clerk
Sophy Treadway,

                                                    Plaintiff—Appellee,

                             versus

Sopheak Otero; Matthew Otero; Exxizz Foods,
Incorporated, doing business as Rockport Donuts,

                                                Defendants—Appellants,

                     consolidated with
                       _____________

                           22-40403
                       _____________

Sophy Treadway; Xenos Yuen,

                                                 Plaintiffs—Appellants,

                             versus

Sopheak Otero; Matthew Otero; Exxizz Foods,
Incorporated, doing business as Rockport Donuts,

                                                 Defendants—Appellees.
Case: 22-40383         Document: 194-1          Page: 2     Date Filed: 04/17/2024

                  _____________________________

                 Appeal from the United States District Court
                     for the Southern District of Texas
                           USDC No. 2:19-CV-244
                 ______________________________

Before Jones, Haynes, and Douglas, Circuit Judges.
Per Curiam:*
        This is an appeal from a jury verdict rendered against the Oteros and
their doughnut company in Rockport, Texas, and sanctions issued against
Plaintiff’s counsel. This court has carefully considered the arguments in light
of the parties’ briefs, the trial court record, and the applicable standards of
review. Finding no reversible error of law or fact, and no abuse of discretion
as to the sanctions order, we must AFFIRM.
               1. Sufficiency of evidence
       The parties are well acquainted with the facts, which involved
Cambodian immigrant Sophy Treadway’s period of employment at the
Oteros’ donut shop allegedly in violation of the Trafficking Victims
Protection Act. See 18 U.S.C. § 1595(a). They focus correctly on whether
there was sufficient evidence to find that Treadway engaged in forced labor,
in violation of 18 U.S.C. § 1589, the predicate for the other statutory offenses
Treadway alleged. See, e.g., Martinez-Rodriguez v. Giles, 31 F.4th 1139, 1149
(9th Cir. 2022). Critical language in the statute holds liable anyone who
        knowingly provides or obtains the labor . . . of a person
        by . . . the following means---
        (1) by means of force [or] threats of force . . . ;
        (2) by means of…threats of serious harm to that person . . . ;
        _____________________
       *
           Pursuant to 5th Circuit Rule 47.5, the court has determined that this opinion
should not be published and is not precedent except under the limited circumstances set
forth in 5th Circuit Rule 47.5.4.

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Case: 22-40383           Document: 194-1          Page: 3       Date Filed: 04/17/2024

                                         22-40383
                                     c/w No. 22-40403

       (3) by means of the abuse or threatened abuse of law or legal
       process; or
       (4) by means of any scheme…intended to cause the person to
       believe that, if that person did not perform such labor or
       services, that person . . . would suffer serious harm . . . .
§ 1589(a).
       There is no dispute that the jury was correctly instructed on the
elements of proof. Thus, whether Treadway was coerced is an objective test.
Muchira v. Al-Rawf, 850 F.3d 605, 618 (4th Cir. 2017) (internal citation
omitted). “Serious harm” under § 1589 includes psychological or financial
harm sufficient “to compel a reasonable person of the same background and
in the same circumstances to perform or to continue performing labor or
services in order to avoid incurring that harm.” § 1589(c)(2). Deportation or
the threat thereof is considered a “serious harm.” Adia v. Grandeur Mgmt.,
Inc., 933 F.3d 89, 93–94 (2nd Cir. 2019) (citing United States v. Kalu, 791 F.3d
1194, 1212 (10th Cir. 2015)). The statute also imposes liability only for
“knowingly” violating its provisions. § 1589(a).
       We are required to accept the verdict of a properly instructed jury
unless, viewed in the light most favorable to the verdict, there is a complete
absence of evidence to support it. Huffman v. Union Pac. R.R. Co., 675 F.3d
412, 425 (5th Cir. 2012).1 Here, there was sufficient evidence from which a
reasonable jury could conclude that Treadway worked long hours for very
low pay over a period of years, while being threatened with deportation. A
reasonable jury could also conclude that the Oteros denied Treadway an
ordinary relationship with her boyfriend (later husband) and required her to
repay them the $20,000 in costs they incurred to bring her to the United
States. The Oteros assert in defense evidence suggesting that “no good deed
       _____________________
       1
           The district court correctly denied the Defendants’ motions for directed verdict.

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                                     22-40383
                                 c/w No. 22-40403

goes unpunished,” and that aphorism may have some relevance here. But
we are not in a position to elevate our view of hotly contested evidence over
that of the jury.
         For the same reasons, and based on essentially the same evidence,
there was sufficient evidence for the jury to find that the Oteros’ violative
conduct proximately caused Treadway to perform labor under conditions
where she would not otherwise have performed and to accrue damages as
proven to the jury. Martinez-Rodriguez, 31 F.4th at 1155.
                2. Sanctions imposed on Plaintiff’s counsel
         The court separately sanctioned Plaintiff’s counsel for three incidents
in connection with this litigation: (1) for vexatiously and repeatedly seeking
unreasonably broad document production; (2) for filing notices of claimed
liens on Defendants’ properties without following proper rules; and (3) for
filing unlawful lis pendens on Defendants’ properties. The court justified
sanctions on the multiple bases of Federal Rule of Civil Procedure 37
(pertinent to the document discovery); 28 U.S.C. § 1927; and its inherent
power.     We review the court’s orders for abuse of discretion, which
encompasses clear error on fact findings or decisions not in accord with the
law. Tollett v. City of Kemah, 285 F.3d 357, 363 (5th Cir. 2002); see also
Morrison v. Walker, 939 F.3d 633, 637 (5th Cir. 2019).
         Counsel was warned in at least two pretrial conferences that his
request for nine years’ worth of financial records from Defendants was
completely excessive. But he persisted in a motion to compel and refused to
narrow the request.       Ordering sanctions, the court also noted that he
“resisted conferring with opposing counsel, had not returned telephone
phone calls, and ha[d] been inflexible in scheduling times to confer with
opposing counsel.” Rule 37 requires a sanction pertaining to a motion to
compel unless “the motion was substantially justified or other circumstances

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                                   22-40383
                               c/w No. 22-40403

make an award of expenses unjust.”         FED. R. CIV. P. 37(a)(5)(B).
Counsel’s arguments against this award are meritless.
       The other two sanctions were based on post-judgment efforts by
Plaintiff’s counsel to attach Defendants’ properties in Texas and California.
The court imposed these sanctions under Section 1927, which lies against any
attorney who vexatiously and unreasonably multiplies proceedings. The
court also invoked its inherent power, under which a court may impose
sanctions based on a specific finding of bad faith. Chambers v. NASCO, Inc.,
501 U.S. 32, 45–46, 111 S. Ct. 2123, 2133 (1991).
       A few weeks after the jury returned a verdict for Treadway, her
counsel filed lis pendens notices in Texas on several properties and one in
California. Making a long story short, according to the court, counsel acted
without understanding or researching California law, misapplied the lis
pendens law because his client’s judgment had nothing to do with “real
property,” and in so doing made false assertions.           The court also
characterized the filing of the lis pendens as “wrongful” and “baseless
actions” that resulted in the Oteros’ bearing “substantial” and
“unnecessary” costs.
       Separately, the court found that counsel “created and filed fraudulent
abstracts of judgment” less than a week after being sanctioned for the lis
pendens. The documents fraudulently represented they were issued by a
court and falsely represented they were pursuant to a judgment connected to
the real property. Not only that, but counsel attempted to secure abstracts
through court processes after the court ordered the contrary, that
“no . . . collection-related efforts shall be initiated by . . . plaintiff’s
counsel . . . .” Together, these actions support the court’s findings of bad
faith, meticulously explained in its opinions, as well as the dollar amounts
imposed. Again, counsel’s arguments are meritless.

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Case: 22-40383      Document: 194-1     Page: 6   Date Filed: 04/17/2024

                                 22-40383
                             c/w No. 22-40403

      Finally, counsel raises unspecific due process challenges to the
imposition of sanctions. The court, however, thoroughly considered both
sides’ arguments in its opinions, had personally been involved in the
discovery disputes, heard evidence on the Texas abstracts, and imposed
amounts that counsel does not attack.
      For these reasons, the judgment is AFFIRMED.

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