Bojicic v. DeWine

1

Erica Bojicic et al., Plaintiffs, v. Michael DeWine et al., Defendants.

No. 3:21-CV-00630-JGC

United States District Court, N.D. Ohio, Western Division

March 27, 2023

ORDER

James G. Carr Sr. U.S. District Judge

This is a § 1983 case where I dismissed Plaintiffs' complaint as frivolous and entirely without merit. (Doc. 49); Bojicic v. DeWine, 569 F.Supp.3d 669, 676 (N.D. Ohio 2021), aff'd, 2022 WL 3585636 (6th Cir. Aug. 22 2022), cert. denied, 143 S.Ct. 735 (2023).

Pending are Defendants Eric Zgodzinski, David Covell, Joseph Mazzola Kirkland Norris, Peter Schade, Kate Siefert, and Donna Skoda's^[1] (“Defendants”) Motions for Sanctions under 28 U.S.C. § 1927 and the inherent authority of the courts. (Docs. 53, 54). Also pending is my own sua sponte order directing Respondent Plaintiffs' counsel, Robert Gargasz and Thomas Renz (“Respondents”), to show cause why I should not impose sanctions under Federal Rule of Civil Procedure 11 § 1927, and my inherent power. (Doc. 61). Plaintiffs themselves are not parties to this sanctions proceeding; it concerns only the Respondent attorneys.

Procedural Background

Following dismissal, Plaintiffs filed their notice of appeal on November 22, 2021. (Doc. 51). A week later, Defendants moved for sanctions. (Docs. 53, 54). On March 7, 2022, I issued my own sua sponte order directing Respondents to show cause why I should not impose sanctions under Rule 11, § 1927, and my inherent power. (Doc. 61).^[2]

I held a status conference on the various sanctions vehicles and scheduled an evidentiary hearing for July 11, 2022, to give Respondents a full opportunity to be heard and present any information they saw fit. (See Minute Order, Mar 21, 2022).

After that hearing, Respondents filed an “Objection to [the] March 21 Court Order

Imposing Burden of Proof on [Respondents] at Sanctions Hearing.” (Doc. 66). I overruled the objection (Doc. 77). I explained the purpose of my March 7, 2021 show cause order-that I had already found a prima facie cause for sanctioning Respondents. The evidentiary hearing, as I discussed, was thus Respondents' “opportunity to ‘persuade' [me] that sanctions are not warranted.” (Id., pgID 915 (quoting Cook v. Am. S.S. Co., 134 F.3d 771, 776 (6th Cir. 1998))).

On July 8, 2022, Respondents moved for, and I granted, a continuance of the evidentiary hearing to allow them time to recruit outside counsel to defend the sanctions proceeding. (Doc. 82; Minute Order, July 8, 2022).

On August 22, 2022, the Sixth Circuit affirmed my dismissal order. Bojicic v. DeWine, 2022 WL 3585636 (6th Cir. Aug. 22, 2022). Around this time, Respondents secured new counsel, and I reset the evidentiary hearing on sanctions to February 13, 2023. (See Minute Order, Oct. 12, 2022).

Plaintiffs petitioned the Supreme Court for a writ of certiorari on November 21, 2022. (See Doc. 96). Six weeks later, on January 4, 2023, Plaintiffs moved for, and I granted, a stay of the sanctions proceeding pending resolution of their petition. (Doc. 100; Minute Order, Jan. 9, 2023). The Supreme Court denied the certiorari petition on January 18, 2023. Bojicic v. DeWine, 143 S.Ct. 735 (2023). Upon that denial, I reset the evidentiary hearing yet again for May 1, 2023. (See Minute Order, Mar. 28, 2023).

Respondents presented two days of testimony and documents at the May hearing, discussed below. And Defendants and Respondents submitted post-hearing briefs in support of and in opposition to sanctions, respectively.

Discussion

I consider sanctions under Federal Rule of Civil Procedure 11, 28 U.S.C. § 1927, and my inherent power. These sanctions vehicles are closely related but different in their details.

1. Burden of Proof

Common to all three sanctions mechanisms is their treatment of the burden of proof. A party seeking sanctions bears the ultimate burden of proof to show that sanctions are appropriate. TEGG Corp. v. Beckstrom Elec. Co., 2008 WL 5216169, at *3 (W.D. Pa. Dec. 10, 2008) (“The burden of proof and persuasion rests on the party moving for sanctions [under Rule 11]”); Scott v. Bank of Am., N.A., 2022 WL 4587839, at *12 (E.D. Mich. Sept. 29, 2022) (“The burden of proof is on the party seeking attorney fees under § 1927.”) (citing Cook v. Am. S.S. Co., 134 F.3d 771, 776 (6th Cir. 1998)); Young v. Aramark Corr. Serv. Llc, 2022 WL 20487073, at *2 (N.D. Ohio Nov. 2, 2022) (Armstrong, Mag. J.) (“[T]he party seeking [inherent power] sanctions bears the burden of proof in establishing these facts.”).

I have already decided that Defendant's Motions for Sanctions and the facts of this case show a prima facie case for application of Rule 11, § 1927 and inherent power sanctions. (Docs. 61, 77). Thus, while the ultimate burden of persuasion stays on Defendants, Defendants have satisfied their initial burden of production through a prima facie showing.

Once a movant establishes a prima facie case, the burden of production shifts to the sanctions respondent to come forward with a reason why they should not be sanctioned. See Digeo, Inc. v. Audible, Inc., 505 F.3d 1362, 1368 (Fed. Cir. 2007) (“Once a litigant moves based upon non-frivolous allegations for a Rule 11 sanction, the burden of proof shifts to the nonmovant to show it made a reasonable pre-suit inquiry into its claim.”); see also Elec. Workers Pension Tr. Fund of Loc. Union 58, IBEW v. Gary's Elec. Serv. Co., 340 F.3d 373, 379 (6th Cir. 2003) (discussing a contemnor's burden of production after the party moving for contempt has established a prima facie case).

In this sanctions proceeding, the burden of production is now on Respondents, who have had the “opportunity to respond[] by presenting evidence and arguments why sanctions should not be imposed.” Cook, supra, 134 F.3d at 776 (“[T]he party has the opportunity to ‘persuade' the court that sanctions are not warranted. This is a well established procedure in dealing with § 1927 sanctions and we see no reason to repudiate the procedure now. Therefore, the burden of proof has not been shifted; the show cause order merely facilitated the due process requirements[.]”); Olga's Kitchen of Hayward, Inc. v. Papo, 108 F.R.D. 695, 701-02 (E.D. Mich. 1985) (“The party whose conduct is under [Rule 11] scrutiny has the burden of demonstrating that he discharged his duty of reasonable inquiry.”), rev'd in part on other grounds sub nom. Olga's Kitchen v. Papo, 815 F.2d 79 (6th Cir. 1987).^[3]

2. Facts and Conduct Considered

I base my decision on Respondents' litigation conduct. This includes, for Rule 11, Respondents' pre-suit conduct, inquiry, investigation, and research in preparing and filing their Complaint. Relevant to both Rule 11 and § 1927, I consider Respondents' conduct following the initiation of this lawsuit and their efforts in opposition to Defendants' Motions to Dismiss.^[4] I further consider the testimony and documents provided to me at the evidentiary hearing.

Respondents argue that I should not consider their conduct on appeal as evidence of bad faith or frivolous conduct before the district court (Doc. 129, pgID 1998), but that I should consider their conduct on appeal as evidence of nonfrivolous conduct (Id., pgID 1996).

I do not consider here Respondents' conduct during the unsuccessful appeal or the petition for certiorari, neither of which affected in any substantive way my original dismissal. See Cooter & Gell v. Hartmarx Corp., 496 U.S. 384, 407 (1990) (“The Federal Rules of Appellate Procedure place a natural limit on Rule 11's scope. On appeal, the litigants' conduct is governed by Federal Rule of Appellate Procedure 38, which provides: ‘If a court of appeals shall determine that an appeal is frivolous, it may award just damages and single or double costs to the appellee.' If the appeal of a Rule 11 sanction is itself frivolous, Rule 38 gives appellate courts ample authority to award expenses.”); Webster v. Sowders, 846 F.2d 1032, 1040 (6th Cir. 1988) (“We recognize that in the course of a lawsuit, the proceedings often take place in both the trial and appellate courts, and that some motions or other actions, such as the motion to stay the pay orders pending appeal, may have impacts at both levels. Nevertheless, the sanction statutes, the rules, and the case law provide for fairly clear separation between conduct on appeal sanctionable by the appellate court and conduct in the trial court sanctionable by the trial court.”).

Thus, I do not consider any conduct on appeal as evidence of sanctionable conduct at the district court level. But I also do not consider conduct on appeal as excusing or redressing nunc pro tunc what happened before me.

Whether or not the appellate court sanctioned appellate conduct has no relevance here. It is entirely consonant that Respondents' conduct on appeal may have comported with the law while their conduct before me did not.^[5] See, e.g., DiPonio Const. Co. v. Int'l Union of Bricklayers & Allied Craftworkers, Loc. 9, 687 F.3d 744, 754 (6th Cir. 2012) (“For the reasons stated above, we AFFIRM the district court's decision to dismiss DiPonio's claims for lack of subject-matter jurisdiction and to award sanctions under Rule 11, but DENY the Union's motion for further sanctions because the appeal is not wholly without merit.”).

Respondents take issue with Defendants' decision not to present evidence at the sanctions hearing. Respondents assert that “there are insufficient facts in evidence to support a finding of misconduct.” (Doc. 129, pgID 1993). According to Respondents, my allowance of a full, in-court hearing to present testimony and documents acted as a complete and self-contained trial- requiring Defendants, as movants and the party with the burden of persuasion, to present its affirmative case much like the plaintiff or prose...