Brown v. Federation of State Medical Boards of U.S., No. 86-2652

CourtUnited States Courts of Appeals. United States Court of Appeals (7th Circuit)
Writing for the CourtBefore COFFEY and FLAUM, Circuit Judges, and ESCHBACH; FLAUM
Citation830 F.2d 1429
Parties44 Empl. Prac. Dec. P 37,398, 56 USLW 2205, 9 Fed.R.Serv.3d 1 Samuel W. BROWN, M.D., Plaintiff, David Neely, Appellant, v. FEDERATION OF STATE MEDICAL BOARDS OF THE UNITED STATES; Educational Commission for Foreign Medical Graduates; and The National Board of Medical Examiners, Defendants-Appellees.
Docket NumberNo. 86-2652
Decision Date18 November 1987

Page 1429

830 F.2d 1429
44 Empl. Prac. Dec. P 37,398, 56 USLW
2205, 9 Fed.R.Serv.3d 1
Samuel W. BROWN, M.D., Plaintiff,
David Neely, Appellant,
v.
FEDERATION OF STATE MEDICAL BOARDS OF THE UNITED STATES;
Educational Commission for Foreign Medical
Graduates; and The National Board of
Medical Examiners, Defendants-Appellees.
No. 86-2652.
United States Court of Appeals,
Seventh Circuit.
Argued June 5, 1987.
Decided Sept. 22, 1987.
Rehearing and Rehearing En Banc Denied Nov. 18, 1987.

Page 1431

Bruce H. Bornstein & Alan M. Freedman, Freedman & Bornstein, Chicago, Ill., for appellant.

Helen E. Witt, Kirkland & Ellis, Chicago, Ill., for defendants-appellees.

Before COFFEY and FLAUM, Circuit Judges, and ESCHBACH, Senior Circuit Judge.

FLAUM, Circuit Judge.

The appellant, David Neely, appeals from the district court's order imposing sanctions against him pursuant to Rule 11 of the Federal Rules of Civil Procedure. The district court's order required Neely, an attorney, to pay the three defendants over $30,000 in attorneys' fees. On appeal, Neely argues that Rule 11 sanctions should not have been granted, and that, even if it was proper for the district court to award sanctions, the court abused its discretion by granting such a large award. We conclude that, although the district court was correct in imposing sanctions, the absence of an appropriately specific award requires a remand of this case for a redetermination of sanctions.

I.

Samuel Brown, M.D., the named plaintiff, received his medical education from the University of Graz, Austria. Brown attempted to pass various state licensing exams thirteen times between 1975 and 1982. These exams were administered under the auspices of the defendants. See Brown v. National Board of Medical Examiners, 800 F.2d 168, 169 (7th Cir.1986). Despite his studying, however, Brown never passed the exams. See id.

Apparently, Brown became convinced that the "testing organizations were engaged in some form of statistical manipulation." Id. Brown pursued several nonlegal channels seeking relief. Id. However, he soon became frustrated with these nonlegal routes. Consequently, on December 2, 1982, Brown, with the aid of an attorney, Toole, filed a complaint against the defendants in federal court. Brown, a black man, was 51 years old at the time he filed this complaint. The complaint alleged violations of equal protection and due process, and alleged discrimination against medical school graduates over 35 years old. Brown requested review of his exams, including his test booklet. However, in June, 1983, the district court dismissed the complaint for want of prosecution.

The next month, the district court reinstated the complaint. At the pretrial conference, the defendants informed Brown that his test booklet had been destroyed during the ordinary course of business. Id. at 170. The defendants offered to allow Brown to review his answer sheets and compare them to the master answer key. "Brown found this approach unacceptable, because he contended that the booklets did still in fact exist and the booklets provided proof of his correct answers." Brown v. Federation of State Medical Boards, No. 82 C 7398, slip op. at 3 (N.D.Ill. May 31, 1985) (footnote omitted) (memorandum opinion).

Brown then filed an amended complaint, which he signed. Toole, however, did not sign this amended complaint which alleged "various constitutional deprivations and

Page 1432

prayed for millions of dollars in damages." Brown, 800 F.2d at 170. At this point, Toole withdrew as Brown's counsel. Brown immediately retained new counsel, Walker. Walker, however, withdrew one month later.

On March 30, 1984, David Neely appeared on Brown's behalf for the first time. Neely filed a second amended complaint. In the second amended complaint, Neely added claims of race discrimination, and violations of the Age Discrimination in Employment Act (ADEA), 29 U.S.C. Secs. 621-34 (1982 & Supp. III 1985). The second amended complaint contained nine related claims:

(1) intentional racial discrimination; (2) intentional age discrimination; (3) violation of due process; (4) violation of the Privileges and Immunities Clause and equal protection; (5) violation of ADEA; (6) violation of 42 U.S.C. Sec. 1981; (7) violation of 42 U.S.C. Sec. 1983; (8) violation of plaintiff's right to travel, right to contract and freedom of expression; and (9) intentional infliction of emotional distress.

Brown, No. 82 C 7398, slip op. at 4-5.

Neely soon became concerned that important documentary evidence would be altered or destroyed. Consequently, he filed an emergency motion to produce documents and have them placed under the court's seal. The district court held a hearing to determine the basis of Neely's request. The district court concluded that the motion was groundless, and assessed attorney's fees of $2,538 against Neely. On appeal, we affirmed this award of attorney's fees. Brown v. National Board of Medical Examiners, 800 F.2d 168 (7th Cir.1986).

The district court, in the same order in which it sanctioned Neely for filing the emergency motion, dismissed the second amended complaint. The court dismissed the Sec. 1983 causes of action because it concluded that there was no state action on the part of the defendants. The district court reasoned that the defendants were not state agencies and did not license the physicians; rather, the defendants only supplied a service used by state licensing boards and examinees. The district court dismissed the Sec. 1981 claims because Brown neither identified the contract that formed the basis of the Sec. 1981 claim nor alleged either intent or any type of actionable activity. The district court dismissed the ADEA claims because, inter alia, Brown had failed to file a complaint with the Equal Employment Opportunity Commission. Finally, the district court dismissed the state claims, declining to exercise its pendent jurisdiction. The district court dismissed the ADEA claims and the Sec. 1983 claims with prejudice. However, the court provided Brown an opportunity to amend the Sec. 1981 counts within 30 days.

After dismissing the complaint, the district court discussed the possibility of sanctions. The court noted that the ADEA claims had no basis in the law, and that the Sec. 1983 claims suffered from "legal infirmities." The district court did not at that time, however, make a finding as to whether the Sec. 1983 claims were unreasonable. Finally, the court noted that if no facts existed to warrant the Sec. 1981 claims, then an amendment of these claims might be sanctionable.

Brown decided not to amend his Sec. 1981 claims. Subsequently, on April 29, 1986, the district court ruled on the defendants' petitions for fees. The district court concluded that Neely's action in filing the second amended complaint was unreasonable, and that the defendants were entitled to their attorneys' fees for defending against that second amended complaint. The court first reviewed the petition of the National Board of Medical Examiners ("National"). The court reduced the billing rates of one of National's attorneys from $140 and $150 per hour to $100 per hour; the court approved the $80 and $85 per hour rates of the other attorney. The court, without making any determination as to the amount of hours that National's attorneys spent defending each count of the second amended complaint, concluded that the time spent was "reasonable" and awarded fees in the amount of $7,281.30. Under the court's order, Brown and Neely were jointly and

Page 1433

severally liable for the award. The court found, however, that the fee petition of the Educational Commission for Foreign Medical Graduates, Inc. ("Commission") and the Federation of State Medical Boards ("Federation") were lacking in specificity. The court, therefore, ordered these two parties to file more detailed petitions. They subsequently filed revised fee petitions.

On July 24, 1986, the district court issued another memorandum order. The court first considered both Brown and Neely's objections to the Rule 11 sanctions. One of Neely's objections to the fee petitions was his inability to pay the sanction. The district court rejected this claim, finding that although Neely's expenses exceeded his income, he would be able to spread his payments over time. Brown, No. 82 C 7398, slip op. at 10. The court refused to consider other equitable factors, such as the wealth of the defendants and Neely's inexperience, because the court believed that "the Seventh Circuit does not find equitable factors relevant, save perhaps a sanctioned party's indigency." Id.

The district court then considered Commission's and Federation's revised fee petitions. Federation had requested $41,359.91. The court disallowed $641 in fees attributable to the first amended complaint. The district court also found that Federation's "petition include[d] excessive time for conferring, both among Federation's own counsel and with counsel for the other defendants." Id. at 7. The court reduced Federation's fee request from over $40,000 to $20,000, and concluded that Neely was jointly and severally liable for $15,000 of the $20,000 in fees awarded to Federation. The court further concluded that Neely was jointly and severally liable to Commission for fees attributable to the second amended complaint in the amount of $8,278.75. Thus, Neely was jointly and severally liable for $7,281.30 to National, $15,000 to Federation, and $8,278.75 to Commission. The district court did not assess costs against Neely. Final judgment was entered on these fee amounts, with interest, and Neely filed a timely notice of appeal.

II.

Rule 11 of the Federal Rules of Civil Procedure provides that if an attorney files pleadings that are not reasonably based on the law or in fact, or that are meant to harass, then "the court upon motion or upon its own initiative, shall impose ... an appropriate sanction." Fed.R.Civ.P. 11...

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200 practice notes
  • Harris v. Marsh, No. 81-60-CIV-3
    • United States
    • United States District Courts. 4th Circuit. Eastern District of North Carolina
    • 28 Diciembre 1987
    ...Advisory Committee Note to Rule 11, 97 F.R.D. at 198-201. See also Brown v. Federation of State Medical Boards of the United States, 830 F.2d 1429, 1435 (7th Cir.1987); Golden Eagle Distributing Co. v. Burroughs Corp., 801 F.2d 1531, 1536 (9th Cir.1986); Blair v. Shenandoah Women's Center, ......
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    • United States
    • United States Bankruptcy Courts. Ninth Circuit. U.S. Bankruptcy Court — Central District of California
    • 31 Marzo 2020
    ...on an attorney's career and personal well-being." 967 F.2d at 1421 (citing Brown v. Federation of State Medical Boards of the U.S., 830 F.2d 1429, 1437 (7th Cir. 1987)). Mindful of these policy concerns, the court approaches the task of determining Milner's Motion for Sanctions against CCM ......
  • Newman-Green, Inc. v. Alfonzo-Larrain R., NEWMAN-GREE
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    • United States Courts of Appeals. United States Court of Appeals (7th Circuit)
    • 11 Agosto 1988
    ...sanction of dismissal. Excessive sanctions are as inappropriate as inadequate ones. See, e.g., Brown v. Federation of State Medical Bds., 830 F.2d 1429, 1437 (7th Cir.1987). So the district court may decide to dismiss Bettison after all, though perhaps on terms different from those proposed......
  • In re Hermosilla, Bankruptcy No. 05–11048–WCH.
    • United States
    • United States Bankruptcy Courts. First Circuit. U.S. Bankruptcy Court — District of Massachusetts
    • 1 Junio 2011
    ...for inquiry, and the ease (or difficulty) of access to the requisite information. See Brown v. Federation of State Medical Bds., 830 F.2d 1429, 1435 (7th Cir.1987); Century Prods., Inc. v. Sutter, 837 F.2d 247, 250–51 (6th Cir.1988); Thomas v. Capital Sec. Servs., Inc., 836 F.2d 866, 875 (5......
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199 cases
  • Harris v. Marsh, No. 81-60-CIV-3
    • United States
    • United States District Courts. 4th Circuit. Eastern District of North Carolina
    • 28 Diciembre 1987
    ...Advisory Committee Note to Rule 11, 97 F.R.D. at 198-201. See also Brown v. Federation of State Medical Boards of the United States, 830 F.2d 1429, 1435 (7th Cir.1987); Golden Eagle Distributing Co. v. Burroughs Corp., 801 F.2d 1531, 1536 (9th Cir.1986); Blair v. Shenandoah Women's Center, ......
  • In re Ministries, Case No. 2:12-bk-15665-RK
    • United States
    • United States Bankruptcy Courts. Ninth Circuit. U.S. Bankruptcy Court — Central District of California
    • 31 Marzo 2020
    ...on an attorney's career and personal well-being." 967 F.2d at 1421 (citing Brown v. Federation of State Medical Boards of the U.S., 830 F.2d 1429, 1437 (7th Cir. 1987)). Mindful of these policy concerns, the court approaches the task of determining Milner's Motion for Sanctions against......
  • Newman-Green, Inc. v. Alfonzo-Larrain R., NEWMAN-GREE
    • United States
    • United States Courts of Appeals. United States Court of Appeals (7th Circuit)
    • 11 Agosto 1988
    ...sanction of dismissal. Excessive sanctions are as inappropriate as inadequate ones. See, e.g., Brown v. Federation of State Medical Bds., 830 F.2d 1429, 1437 (7th Cir.1987). So the district court may decide to dismiss Bettison after all, though perhaps on terms different from those proposed......
  • In re Hermosilla, Bankruptcy No. 05–11048–WCH.
    • United States
    • United States Bankruptcy Courts. First Circuit. U.S. Bankruptcy Court — District of Massachusetts
    • 1 Junio 2011
    ...for inquiry, and the ease (or difficulty) of access to the requisite information. See Brown v. Federation of State Medical Bds., 830 F.2d 1429, 1435 (7th Cir.1987); Century Prods., Inc. v. Sutter, 837 F.2d 247, 250–51 (6th Cir.1988); Thomas v. Capital Sec. Servs., Inc., 836 F.2d 866, 875 (5......
  • Request a trial to view additional results
1 books & journal articles
  • Ethics in Pandemics: the Lawyer For the (crisis) Situation
    • United States
    • Georgetown Journal of Legal Ethics Nbr. 34-2, April 2021
    • 1 Abril 2021
    ...square off in a search for the truth184—the “normal” rules of 181. See, e.g., Brown v. Fed’n of State Med. Bds. of the United States, 830 F.2d 1429, 1435 (7th Cir.1987) (describing factors courts should take into account regarding lawyer obligations under emergency situations). 182. See Aut......

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