Martin v. SGT, Inc.
| Decision Date | 22 May 2023 |
| Docket Number | 2:19-cv-00289-RJS |
| Parties | CHRISTINE MARTIN, Plaintiff, v. SGT, INC. f/k/a TGT, INC., a Wyoming corporation, Defendant. |
| Court | U.S. District Court — District of Utah |
On December 28, 2022, the court granted terminating sanctions and an award of attorneys' fees and expenses for Defendant SGT, Inc. after concluding Plaintiff Christine Martin had altered and deleted material evidence.[1] Now before the court are SGT's requests for attorneys' fees and expenses,[2] and Martin's Motion for Reconsideration or Relief from Judgment requesting reconsideration of the court's attorney fee sanction.[3] For the reasons explained herein Martin's Motion is DENIED and SGT's requested attorneys' fees and expenses are GRANTED IN PART.
BACKGROUND AND PROCEDURAL HISTORY[4]
Martin filed this action alleging SGT exceeded the scope of a license to use her artwork, thereby breaching an oral contract between the parties.[5]After protracted discovery mired by Martin's misconduct and “scattershot” document productions,[6] the court was alerted to uncontroverted evidence that she had altered and destroyed material evidence concerning the parties' oral contract.[7] After reviewing the evidence, the court found-by clear and convincing evidence-that Martin had altered a July 2018 email to the owner of SGT, Timothy Tasker, by adding language helpful to her position, which was then forwarded to her counsel.[8]The court further found that Martin had “deleted all other copies [of the email] in her possession which could be used to undermine her forgery,” violating her obligation to retain materials related to the litigation.[9]“By altering and destroying material evidence,” the court concluded that Martin had “undermined the discovery process, her own credibility the authority of the court, and the legitimacy of this litigation-which she initiated.”[10]
In light of Martin's repeated discovery abuses and the misconduct surrounding the July 2018 email, the court determined “serious sanctions” were warranted.[11] On December 28, 2022 the court therefore granted SGT's Renewed Third Motion for Sanctions[12]and terminated Martin's lawsuit with prejudice.[13]Additionally, the court determined SGT was entitled to an award of reasonable expenses associated with Martin's discovery misconduct and spoliation pursuant to Federal Rule of Civil Procedure 37(b)(2)(C), which was assessed against Martin personally.[14]
The court's December 28, 2022 Order prompted a flurry of activity by Martin and her counsel. First, on January 11, 2023, Martin's counsel[15]attempted to discontinue representation by filing a Notice of Withdrawal of Counsel.[16]Because the withdrawal would leave Martin unrepresented even as she faced a substantial attorney fee sanction, the court directed counsel to comply with the withdrawal procedures of Local Rule 83-1.4(c).[17]However, shortly thereafter, Martin obtained new counsel from the law firm of Zimmerman Booher,[18]and promptly filed a Notice of Appeal with the United States Tenth Circuit Court of Appeals.[19]In particular, Martin appealed the court's “December 28, 2022 Judgment in a Civil Case . . . [and] all subsidiary rulings and orders leading to final judgment.”[20] Given the appearance of her new counsel, the court granted Martin's former counsels' request for leave to withdraw from representation.[21] While her appeal was pending, Martin responded to SGT's fee application[22]by arguing, among other things, that former counsel should pay for SGT's attorneys' fees and expenses “because the sanctions arose from counsel's conduct.”[23]She also claimed the spoliation of evidence “was an unfortunate accident” potentially caused by her “severe dyslexia . . . and processing disorder,” rather than “an attempt to tamper with evidence.”[24] SGT disputed Martin's post hoc theory for the spoliation of the July 2018 email and challenged her argument as procedurally improper.[25]Following SGT's objections, Martin submitted the present Motion for Reconsideration or Relief from Judgment under Federal Rules of Civil Procedure 54(b) and 60(b)(6), respectively, “to provide a procedural vehicle by which the court can exercise its discretion and impose attorney fee sanctions on prior counsel, rather than on [her].”[26]
In the following weeks, the Tenth Circuit abated Martin's appeal, “[i]n the interest of judicial economy,” pending this court's “decision regarding the amount of attorney's fees and costs” owed to SGT.[27]Additionally, the court received extensive briefing from SGT,[28]Martin,[29]and former counsel[30] concerning the reasonableness of SGT's fee request and Martin's argument that the court should shift the attorney fee sanction to former counsel. Moreover, SGT filed a second fee request “for the work it performed post-judgment to recover the fees [previously] awarded to it.”[31]Upon full consideration of the parties' briefing, oral argument concerning Martin's Motion was heard on May 2, 2023,[32]and the matter taken under advisement. For the reasons discussed below, the court DENIES Martin's Motion for Reconsideration or Relief from Judgment and GRANTS IN PART SGT's requested attorneys' fees and expenses.
Martin proceeds under Rules 54(b) and 60(b)(6), which allow parties to request reconsideration of a prior court order or relief from a judgment or order, respectively. Although not formally recognized by the Federal Rules of Civil Procedure, motions for reconsideration are generally construed under either Rule 54(b) or Rule 60(b), depending on when the motion is filed.[33]Motions for reconsideration filed before entry of final judgment are construed under Rule 54(b), whereas motions for relief filed more than ten days after judgment are generally construed under Rule 60(b).[34]Because there is some ambiguity regarding the finality of the court's December 28, 2022 Order and Judgment,[35]Martin moves for relief under both Rules, with Rule 54(b) as her primary procedural vehicle and Rule 60(b) as her alternate.[36] Motions for reconsideration under Rule 54(b) may only be granted based on the availability of new evidence, an intervening change in the controlling law, or the need to correct clear error or prevent manifest injustice.[37]A motion for reconsideration therefore may be granted only where “the court has misapprehended the facts, a party's position, or the controlling law”[38]Importantly, motions to reconsider are improper when used to[39]“revisit issues already addressed or advance arguments that could have been raised in prior briefing.”[40]
Rule 60(b), by contrast, “permits a party to seek relief from a final judgment, and request reopening of [the] case, under a limited set of circumstances.”[41]Martin's specific ground for relief comes under Rule 60(b)(6), which affords courts “a grand reservoir of equitable power to do justice in a particular case.”[42]Relief under this subsection “is appropriate only when circumstances are so unusual or compelling that extraordinary relief is warranted or when it offends justice to deny such relief.”[43]Generally, the situation must be one beyond the control of the party requesting relief under Rule 60(b)(6) to warrant relief.[44] It is “not intended to allow a party to present its argument on the merits as many times as it takes to get it right.”[45]
The court first addresses whether Martin's Motion should be construed under Rule 54(b), as she asserts, or Rule 60(b)(6). As prefaced above, the finality of the court's December 28, 2022 Order and Judgment is unclear under Tenth Circuit case law, so Martin moves for relief under both Rules.[46]But she maintains that “[w]hat seems clear is that the attorney fee sanction-as distinct from the terminating sanction-is not final because the court has not yet reduced that award to a sum certain.”[47]Therefore, she contends that the court can, under Rule 54(b), reconsider its decision to assess the attorney fee sanction against her personally.[48]SGT counters that Martin already appealed the court's sanction by filing a Notice of Appeal, thereby divesting this court of jurisdiction to reconsider its prior sanction.[49]
The Supreme Court explains, “[t]he filing of a notice of appeal is an event of jurisdictional significance-it confers jurisdiction on the court of appeals and divests the district court of its control over those aspects of the case involved in the appeal.”[50]Yet, while a notice of appeal narrows a district court's plenary jurisdiction over the case, its jurisdictional effect is not absolute. The Federal Rules of Civil Procedure and Tenth Circuit case law contemplate a “jurisdiction phased de-escalation process” during the first twenty-eight days following entry of final judgment, wherein a district court “goes from pre-final judgment plenary jurisdiction . . . to limited review.”[51]After twenty-eight days following entry of final judgment, the district court's review is limited to requests for relief from judgment under Rule 60.[52]However, even after filing a notice of appeal, the district court retains jurisdiction over certain “collateral matters not involved in the appeal,” such as “the propriety and amount of attorney's fees.”[53]
Martin does not dispute that her Motion was filed more than twenty-eight days following entry of the court's December 28, 2022 Order.[54] But she argues the court can properly consider her Rule 54(b) ...
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