Miranda v. Southern Pacific Transp. Co.

• Decision Date: 12 July 1983
• Docket Number: No. 80-5413,80-5413
• Citation: 710 F.2d 516
• Parties: Victor MIRANDA, Plaintiff, v. SOUTHERN PACIFIC TRANSPORTATION COMPANY, a Delaware corporation, Defendant. In the Matter of R. Edward PFIESTER, Esquire, and G. Richard Ford, Esquire, Appellants.
• Court: U.S. Court of Appeals — Ninth Circuit

Page 516

710 F.2d 516

Victor MIRANDA, Plaintiff, v. SOUTHERN PACIFIC TRANSPORTATION COMPANY, a Delaware

corporation, Defendant.

In the Matter of R. Edward PFIESTER, Esquire, and G. Richard

Ford, Esquire, Appellants.

No. 80-5413.

United States Court of Appeals, Ninth Circuit.

Argued and Submitted Feb. 5, 1982.

Decided July 12, 1983.

H. Andrew Wasmund, Bank, Wasmund & Davidson, Manhattan Beach, Cal., for appellants.

Appeal from the United States District Court For the Central District of California.

Before WALLACE, HUG and ALARCON, Circuit Judges.

HUG, Circuit Judge:

Pfiester and Ford, opposing counsel in a civil case, appeal a district court's order imposing sanctions of two hundred and fifty dollars on each of them for failing to comply with the local rules regarding the pretrial conference. On appeal, they contend that: (1) the district court has no authority to impose monetary sanctions without a finding of contempt; (2) the district court violated due process by imposing the sanctions without affording them notice, an opportunity to prepare a defense, and a hearing; and (3) the sanctions were invalid as contempt penalties because there was no evidence demonstrating their willful violation of the district court's orders.

We hold that Local Rule 28 of the District Court for the Central District of California authorized the district court to impose monetary sanctions for failing to comply with the local rules. We reverse the order imposing the penalties and remand the case to allow the attorneys an opportunity to request a hearing and show cause why the sanctions should not be imposed.

FACTS

In June 1977, Miranda, an employee of the Southern Pacific Transportation Co., filed a negligence action against his employer under the Federal Employers' Liability Act, 45 U.S.C. Sec. 51 et seq. (1976). The attorneys submitted memoranda of contentions of law and fact and a proposed pretrial conference order in April 1980.

At the pretrial conference, the district court found the documents "totally unsatisfactory." Specifically, the court found plaintiff's Memorandum of Factual and Legal Contentions to be "rambling" and "prolix," rather than concise, as required by Central District of California Local Rule 9. ¹ The court also found that plaintiff's exhibits were combined for identification, rather than being individually identified. ² Finally, the court found that both parties had failed to comply with Local Rule 9 with respect to the expert witnesses' qualifications and the substance of their testimony. ³

With respect to the pretrial conference order, the court told the attorneys to "determine what documents you seek to exclude, stating the legal grounds for your objection, and state such further material with respect to that objection as is necessary to understand your position." ⁴ The At the second pretrial conference in May 1980, the court found that the attorneys still had not complied with Local Rule 9, in part because both parties had again identified certain exhibits together. The court also found the pretrial conference order seriously deficient, and concluded by imposing sanctions of $250 on each counsel.

court concluded by warning counsel to pay particular attention to the local rules if they wanted to avoid sanctions.

The attorneys paid the $250 sanctions. Eight days after the second pretrial conference, the parties stipulated to dismissal of the complaint. Two days later, the attorneys filed a notice of appeal with respect to the order assessing sanctions against them.

More than two months later, the attorneys moved the district court to remit their penalties. Both attorneys argued that the sanctions appeared to be criminal in nature, thus necessitating contempt proceedings. They also contended that contempt would not be a proper sanction because they had made a good faith effort to comply with the court's orders.

On November 20, 1980, the court rejected counsels' request to remit the penalties:

Where, as here, both counsel are at fault and the remedy of sanctions against one party in favor of the other is unavailable, it is our view that the court's inherent power to enforce its rules, orders and procedures and to impose appropriate sanctions for failure to comply may be invoked, that the sanctions here imposed were reasonable and appropriate and that contempt proceedings were unnecessary.

The court found that the attorneys did not make a good faith attempt to comply with its orders, but stated that it did not believe that good faith would bar the sanctions.

Counsel filed an amended notice of appeal from this order on February 3, 1981, more than sixty days after the district court's order declining to remit the penalties.

DISCUSSION

I Jurisdiction

The first notice of appeal, filed within 30 days of the district court's order assessing the $250 sanctions, was timely. ⁵ Fed.R.App.P. 4(a). Consequently, this court has jurisdiction to consider the appeal from the order imposing the sanctions. We do not have jurisdiction to consider the district court's order denying the attorneys' motion to remit their penalties. The district court lacked jurisdiction to consider the motion to remit because the timely filing of the notice of appeal from the original order imposing sanctions transferred the action to this court. See Davis v. United States, 667 F.2d 822, 824 (9th Cir.1982). ⁶

II Authority to Impose Sanctions

We first consider whether the district court had authority to impose the $250 sanctions. The district court apparently relied upon the local rules of the Central District of California as authority for levying the $250 sanctions for failure to comply with C.D.Cal.R. 9. C.D.Cal.R. 9.10 provides: "Failure of counsel to comply [with Rule 9] shall subject counsel to the sanctions provided by the provisions of Local Rule 28 and 28 U.S.C. Section 1927." Because we find that C.D.Cal.R. 28 ⁷ authorizes the $250 sanctions here, we do not reach the question of whether 28 U.S.C. Sec. 1927 authorizes the imposition of sanctions payable to the court. ⁸

The appellants contend that we should follow Gamble v. Pope & Talbot, Inc., 307 F.2d 729 (3d Cir.) (en banc), cert. denied, 371 U.S. 888, 83 S.Ct. 187, 9 L.Ed.2d 123 (1962). In Gamble, the district court imposed a $100 sanction on defendant's counsel, payable to the United States, for filing his pretrial memorandum late. The district court acted under a "standing order" of the Eastern District of Pennsylvania that authorized the imposition of monetary sanctions and costs on counsel for failure to prepare for a pretrial conference. Id. at 730. The Third Circuit, sitting en banc, held that the Federal Rules do not authorize monetary sanctions to be imposed against attorneys in a civil litigation unless the attorneys are held in contempt under 18 U.S.C. Sec. 401. Id. at 731. The majority reasoned that the sanction actually constituted a criminal penalty. Id. at 733.

Two judges dissented. Chief Judge Biggs stated that: (1) imposing monetary sanctions on counsel was more appropriate than penalizing a party for counsel's negligence, which would occur if the court dismissed the action under the rationale of Link v. Wabash Railroad Co., 370 U.S. 626, 82 S.Ct. 1386, 8 L.Ed.2d 734 (1962); (2) the district court's standing order was valid under Fed.R.Civ.P. 83 as a rule not inconsistent with the Federal Rules; and (3) the district court has the inherent power to impose appropriate and reasonable sanctions upon those admitted to its bar. Id. at 734-36. For the reasons stated by Judge Biggs, we decline to follow Gamble and uphold the authority of the district court to impose a monetary sanction for violation of local rules under C.D.Cal. Local Rule 28.

The Supreme Court recently cited Judge Biggs's dissenting opinion with approval in Roadway Express, Inc. v. Piper, 447 U.S. 752, 100 S.Ct. 2455, 65 L.Ed.2d 488 (1980), where it reaffirmed the inherent power of the district courts to levy sanctions. Id. at 765, 766 & n. 12, 100 S.Ct. at 2464 & n. 12. ⁹ Our holding is also supported by the Ninth Circuit rule that, before dismissing a case under Fed.R.Civ.P. 41(b) for failure to comply with an order of the court, the district court should consider less severe sanctions. Raiford v. Pounds, 640 F.2d 944, 945 (9th Cir.1981). We have previously suggested that the court may wish to consider disciplinary proceedings against the noncomplying attorneys as a penalty less severe than dismissal. Raiford, 640 F.2d at 945 n. 1. ¹⁰ We believe that imposing a monetary penalty on counsel is an appropriate sanction considerably less severe than holding counsel in contempt, referring the incident to the client or bar association, or dismissing the case. If we were to foreclose the district court from imposing this relatively mild penalty for violation of the local rules, district courts would be forced to resort to more severe sanctions. See, e.g., Chism v. National Heritage Life Insurance Co., 637 F.2d 1328, 1331-32 (9th Cir.1981) (affirming dismissal of case with prejudice for plaintiff's continual failure to comply with discovery rules, pretrial conference obligations, and local rules of court); C. Renfrew, Discovery Sanctions: A Judicial Perspective, 67 Calif.L.Rev. 264, 278 & n. 54 (1979). We also believe it is appropriate that sanctions such as these are directed at the lawyers responsible, rather than the litigants. See Flaksa v. Little River Marine Construction Co., 389 F.2d 885, 889 & n. 11 (5th Cir.), cert. denied, 392 U.S. 928, 88 S.Ct. 2287, 20 L.Ed.2d 1387 (1968); R. Rodes, K. Ripple, & C. Mooney, Sanctions Imposable for Violations of the Federal Rules of Civil Procedure, 70-73 (Federal Judicial Center 1981).

Local Rule 28 is not inconsistent with any federal law or the Federal Rules of Civil Procedure and therefore not invalid under 28 U.S.C. Sec. 2071 and Fed.R.Civ.P. 83. See Transamerica Corp. v. Transamerica Bancgrowth Corp., 627 F.2d 963, 965-66 (9th Cir.1980)....