Court Opinion

ID: 5129274
Source: CourtListenerOpinion
Date Created: 2021-11-24 17:01:05.440409+00
Date Added: 2024-06-11T08:23:11.448840
License: Public Domain

UNITED STATES DISTRICT COURT
                            FOR THE DISTRICT OF COLUMBIA

 ANDREW CHIEN,
       Plaintiff
         v.                                                Civil Action No. 18-2050 (CKK)
 RICHARD J. FREER, et al.,
        Defendants.

                          MEMORANDUM OPINION AND ORDER
                                (November 23, 2021)

        This matter comes before the Court on Defendants’ [9] Motion for Sanctions.

Defendants ask that the Court enter sanctions against Plaintiff, a vexatious and frivolous litigant

who has filed numerous unsuccessful cases against Defendants across several jurisdictions.

Specifically, Defendants ask for: (1) dismissal with prejudice, (2) a prefiling injunction against

similar complaints that Plaintiff may seek to file, and (3) attorneys’ fees. Having already granted

Defendants’ [8] Motion to Dismiss, the Court will not dismiss the case as a sanction. Nor will

the Court grant attorneys’ fees. The Court shall, however, enter a prefiling injunction against

Plaintiff in the United States District Court for the District of Columbia, requiring Plaintiff to

seek leave of court to file any future action arising from or similar to the cases that have been

before this Court. As such, the Court GRANTS IN PART AND DENIES IN PART

Defendants’ [9] Motion for Sanctions.

   I.         BACKGROUND

        As further explained in the Court’s [33] Order granting Defendants’ [8] Motion to

Dismiss, this is Plaintiff’s third case before the Court alleging various species of fraud against

Defendant Richard J. Freer (“Freer”), his former business partner, and China Bull Management,

Inc. (“CHBM”), a corporate entity which Freer and Plaintiff fought each other to control. See

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Compl. at 5-7; Compl., Chien v. Ransom et al., 17-cv-2334 (Nov. 1, 2017) (Chien I) at 4;

Compl., Chien v. Morris et al., 19-cv-03101 (Oct. 11, 2019) (“Chien III”). 1 Unhappy with the

Court’s rulings across his three cases, Plaintiff also unsuccessfully filed suit against the

undersigned. Order, Chien v. Kollar-Kotelly, 19-cv-3100 (D.D.C. May 6, 2020) (dismissing the

case due to judicial immunity).

       In essence, all of Plaintiff’s suits arise from the same nucleus of facts. Freer was, at one

point, an officer of the defunct Commonwealth Biotechnologies, Inc. (“CBI”), which filed for

bankruptcy in January 2011. Memorandum Opinion, Chien I, at 4, ECF No. 52. Freer served as

an operating director of CBI during bankruptcy, while Plaintiff was either a shareholder or a

representative of another shareholder. Id. After Freer made compensation claims from CBI,

Plaintiff claimed that Freer was attempting to embezzle money from the company. Id. For this

allegation, Freer successfully sued Plaintiff for defamation in Virginia state court, obtaining a

default judgment of $1,600,000.00 plus interest. Id. Freer eventually obtained stock certificates

for CHBM to satisfy that judgment, and subsequently re-registered CHBM from Nevada to

Wyoming with the U.S. Securities and Exchange Commission (“SEC”). Id. at 5.

       In Chien I, Plaintiff sued the SEC and SEC officials for, among other things, facilitating

Freer’s filings. Id. This Court dismissed Plaintiff’s complaint in that case for, among other

things, failure to exhaust administrative remedies. Id. at 26-27. Plaintiff then filed an identical

suit making the same allegations against SEC officials in Chien I. Order, Chien III (Feb. 15,

2021), at 1, ECF No. 33. The Court dismissed that case on res judicata grounds and,

1
  This case was filed after Chien I and before Chien III. The Court shall refer to it as “Chien II”
for ease of reference.
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subsequently, Plaintiff’s four motions for reconsideration in that case. Memorandum Opinion,

Chien III (Nov. 12, 2021), ECF No. 50.

        Plaintiff’s prior cases alleging these same facts and similar causes of action are legion.

Plaintiff’s successive, frivolous, and vexatious filings have earned him sanctions across several

jurisdictions. They include:

 Name                              Court                             Sanction

 Chien v. Skystar Bio Pharm.       United States District Court      Attorneys’ fees and costs
 Co., 3:09CV149                    for the District of Connecticut
 In re Commonwealth                United States Bankruptcy          Bar on new pleadings and
 Biotechnologies, Inc., 11-        Court for the Eastern District    money sanctions
 30381-KRH                         of Virginia
 Chien v. Barron Capital           United States Court of            Attorneys’ fees and costs
 Advisors, LLC, 12-16263           Appeals for the Second
                                   Circuit
 Chien v. Freer, 3:13CV540         United States District Court      Ban on new pleadings in
                                   for the Eastern District of       action without leave of court
                                   Virginia
 Chien v. Freer, CL                Circuit Court, Prince George      Ban on new filings in action
 14000491-00                       County, Virginia                  and filing new actions against
                                                                     named defendants in Virginia
                                                                     state court
 Freer v. Chien, NNH-CV-12-        Connecticut Superior Court        Ban on new filings in action
 4053717
 Freer v. Chien, AC 40144          Connecticut Appellate Court     Dismissal and pre-filing
                                                                   injunction
 Chien v. Clark, et al.,           United States District Court    Prefiling injunction without
 3:16CV1881                        for the District of Connecticut leave of court

By the Court’s count, Plaintiff has filed twelve actions in Connecticut state and federal courts,

thirty-three actions in Virginia state and federal courts, four actions in the United States District

Court for the District of Columbia, six appeals in the United States Court of Appeals for the

Fourth Circuit, one appeal in the United States Court of Appeals for the Second Circuit, and one

appeal in the Supreme Court of the United States. See Defs.’ Ex. A (listing cases). All of these

cases have either been unsuccessful or remain pending.

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         Defendants filed the instant Motion on October 5, 2018. Taking notice of the Motion and

its fourexhibits, Plaintiff filed his opposition on October 11, 2018. On October 12, 2018, the

Court stayed the case while it resolved Chien III. The Court issued its final order in Chien III on

November 12, 2021. Having addressed that case, the Court now turns to the instant Motion’s

resolution.

   II.        DISCUSSION

              A. Prefiling Injunction

         When faced with “frivolous, duplicative, and harassing lawsuits,” the Court has the

inherent power to “‘employ injunctive remedies when needed to protect the integrity of the

courts and the orderly and expeditious administration of justice.’” Caldwell v. Obama, 6 F. Supp.

3d 31, 49, 51 (D.D.C. 2013) (quoting Mikkilineni v. Penn. Nat. Mut. Cas. Ins. Co., 271 F. Supp.

2d 142, 143 (D.D.C. 2003)). When fashioning a pre-filing injunctive remedy, “‘a court must

take great care not to ‘unduly impair[] [a litigant’s] constitutional right of access to the courts.’”

Id. at 49 (brackets original) (quoting Urban v. United Nations, 768 F.2d 1497, 1500 (D.C. Cir.

1985)). Before entering a prefiling injunction, the Court must: (1) provide notice to the affected

party, (2) consider the “number and content” of the filings, and (3) “make substantive findings as

to the frivolous or harassing nature of the litigant’s actions.” In re Powell, 851 F.2d 427, 431

(D.C. Cir. 1988); see also In re Visser, 968 F.2d 1319, 1324-25 (D.C. Cir. 1992) (prohibiting pro

se plaintiff from filing further complaints without leave when he filed 11 repetitive and meritless

complaints).

         First, Defendants’ Motion placed Defendant on notice of the sanctions Defendants seek.

Moreover, despite previously filing an opposition on October 11, 2018, the Court directed

Plaintiff to file an additional opposition in its October 12, 2018 [11] Order. Plaintiff did so on

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October 16, 2018. ECF No. 12. Consequently, the Court finds that Plaintiff has been adequately

notified of the sanctions Defendants request.

        Second, the “number” of Plaintiff’s filing are legion and the facts in each are near

identical. Having reviewed the dockets and select filings across Plaintiff’s four in this Court and

forty-nine other cases, they all revolve around Plaintiff’s alleged injuries sustained by Freer and

associated entities. Although some concern the bankruptcy and defamation cases, most center on

SEC filings Freer made indicating his ownership of CHBM. State and federal courts in

Connecticut and Virginia have already rejected the panoply of claims Plaintiff has advanced on

these facts. Nevertheless, Plaintiff has continued to make frivolous filings.

        The United States District Court for the District of Connecticut, for example, warned

Plaintiff that it would enter a prefiling injunction if Plaintiff filed another suit involving Freer.

Order at 5, ECF No. 40, Chien v. Clark, et al., No. 3:16-cv-01881-AVC (D. Conn. Sept. 8, 2017)

(slip op.). Plaintiff ignored that warning, filing another identical case, and the court promptly

entered a prefiling injunction “prohibit[ing] [Plaintiff] from filing further actions in this court

without leave of the court.” Id. at 6. Similarly, in the United States Bankruptcy Court for the

Eastern District of Virginia, the court barred Plaintiff on May 1, 2014, from making further

filings in the case without leave of court. See Order at 3, ECF No. 50, Chien v. Freer, et al., No.

3:13CV540 (E.D. Va. Aug. 15, 2014) (slip op.). After violating that order several times, the

United States District Court for the Eastern District of Virginia agreed with the Bankruptcy

Court after finding that Plaintiff “made numerous and frequently incoherent motions” during the

“pendency of th[e] appeal.” Id. at 6-7. While this case was pending, and without notification to

this Court, Plaintiff moved for relief from the Eastern District of Virginia’s order on April 7,

2021, which the court there subsequently denied. Order at 1, ECF No. 55, Chien, No.

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3:13CV540 (Sept. 1, 2021) (slip op.). Moreover, Plaintiff’s incessant filings and refusal to

comply with court orders has even resulted in his incarceration in Virginia for civil contempt of

court. Order at 5 n.2, Chien v. Freer, No. 1117-14-2 (Va. Ct. App. June 30, 2015) (slip op.).

Having sued Freer, CHBM, and associated entities in scores of actions across several

jurisdictions, the Court concludes that a pre-filing injunction is warranted. See Visser, 968 F.2d

at 1324-25. As such, the Court shall enter an injunction requiring Plaintiff to obtain leave of

court making any future filing involving Freer, CHBM, the U.S. Securities and Exchange

Commission, or any other entity and a similar set of facts.

           B. Attorneys’ Fees

       Next, Defendants ask the Court to sanction Plaintiff by awarding Defendants’ attorneys

fees. 2 Although the Court has the inherent power to sanction a party by awarding attorneys’

fees, “[b]ecause of their very potency, inherent powers must be exercised with restraint and

discretion.” Chambers v. NASCO, Inc., 501 U.S. 32, 44 (1991). The power to award attorneys’

fees as a sanction arises from a court’s “inherent authority to control and maintain the integrity of

its own proceedings.” HTH Corp. v. NLRB, 823 F.3d 668, 679 (D.C. Cir. 2016). The Court has

already determined to dismiss this case and to enter a prefiling injunction on future, similar

filings. These actions sufficiently serve the Court’s interest in the integrity and efficient

administration of the proceedings before it. Indeed, awarding further sanctions may result in

even more protracted and lengthy proceedings that would not further the “just, speedy, and

inexpensive determination of [this] action and [future] proceeding[s].” Fed. R. Civ. P. 1. As

2
  Defendants also ask the Court to sanction Plaintiff by dismissing this case with prejudice. As
the Court has already dismissed the case in its [33] Order granting Defendants’ [8] Motion to
Dismiss, it need not address this requested relief.
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such, the Court shall not exercise the “potent” inherent power to award attorneys’ fees as a

sanction in this case.

   III.      CONCLUSION

          For the foregoing reasons, it is hereby

          ORDERED, that Defendants’ [9] Motion for Sanctions is GRANTED IN PART AND

          DENIED IN PART; it is further

          ORDERED, that that the following pre-filing injunction is hereby imposed on Andrew

Chien and shall remain in effect unless and until it is modified by the Court:

          1. Andrew Chien is not permitted to file any additional pleadings, motions, requests, or

             other documents in this case, Chien v. Ransom et al., 17-cv-2334, or Chien v. Morris

             et al., 19-cv-03101, unless he first receives leave of court to do so. Therefore, the

             Clerk’s Office is directed not to file or docket further submissions received from

             Andrew Chien in this action or in those related actions unless or until it receives an

             appropriate order from this Court;

          2. Andrew Chien is prohibited from commencing a new lawsuit in the United States

             District Court for the District of Columbia, without leave of Court, against Richard J.

             Freer, China Bull Management, Inc., the U.S. Securities and Exchange Commission,

             Mara L. Ransom, Kara M. Stein, Denis Brand Morris, the United States of America,

             and/or any new party where the facts alleged in any new pleading arise from the same

             nucleus of facts as in the pleadings in this case, Chien v. Ransom et al., 17-cv-2334,

             or Chien v. Morris et al., 19-cv-03101;

          3. If Andrew Chien seeks leave to file a new lawsuit in the United States District Court

             for the District of Columbia as described in subpart 2, he is required to file the

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         following along with his Summons and Complaint: (a) a motion captioned “Motion

         Pursuant to Court Order Seeking Leave to File;” (b) as Exhibit 1 to that motion, a

         copy of this Order; (c) as Exhibit 2 to that motion, a sworn affidavit certifying that the

         claim he wishes to present does not arise from the same nucleus of facts as in the

         pleadings in this case, Chien v. Ransom et al., 17-cv-2334, or Chien v. Morris et al.,

         19-cv-03101; and (d) as Exhibit 3 to that motion, a list of the full captions of each and

         every action previously filed by him or on his behalf in any court against each and

         every defendant to the proposed new action. Andrew Chien’s compliance with this

         requirement will not guarantee that such motion will be granted.

         SO ORDERED.

Dated: November 23, 2021
                                                       /s/
                                                    COLLEEN KOLLAR-KOTELLY
                                                    United States District Judge

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