Opinion
Civil Action No: 02-160, Section: "R" (1)
October 25, 2002
ORDER AND REASONS
Before the Court is the motion of defendant, Diamond Offshore Management Company and Diamond Offshore Drilling, Inc., to dismiss this action pursuant to Federal Rule of Civil Procedure 12(b)(6), or in the alternative, grant summary judgment pursuant to Rule 56, on the grounds of res judicata. The Court will treat defendant's motion as a motion for summary judgment. Defendant further moves the Court to order Rule 11 sanctions against the plaintiff.
Plaintiff filed suit in this Court pursuant to 46 U.S.C. § 688, invoking the Court's federal question jurisdiction under the Jones Act. Plaintiff advances theories of negligence and unseaworthiness and asserts a claim for maintenance and cure for injuries he allegedly sustained aboard the defendant's vessel.
For the following reasons, the Court GRANTS defendant's motion for summary judgment on the grounds of res judicata and GRANTS defendant's motion for Rule 11 sanctions.
I. BACKGROUND
On August 29, 2000, plaintiff filed a complaint in the Southern District of Texas, captioned as Clinton Stacey Dillon v. Diamond Offshore Management Company and Diamond Offshore Drilling, Inc. In that lawsuit, plaintiff advanced theories of negligence and unseaworthiness and a claim for maintenance and cure for injuries he allegedly sustained aboard the defendant's vessel.
On September 17, 2001, the district court dismissed plaintiff's case without prejudice because he failed to appear the morning of trial, which had been scheduled for over nine months. Plaintiff's counsel, who was present at trial, stated that plaintiff had actual notice of the trial but could not be located. The court declined to continue the trial, and plaintiff's attorney stated he was unprepared to proceed. The court dismissed the case for want of prosecution, with each party to bear its own costs. The court also held that if plaintiff sought to reinstate his case within thirty days, the court would be amenable, but that plaintiff would first have to pay the costs defendant had incurred to prepare for trial.
On September 28, 2001, plaintiff's counsel withdrew his representation. Plaintiff began sending letters to the district court judge as a pro se plaintiff, repeatedly asking the court to give him a chance for "a fair trial." The court responded with orders restating and explaining its preconditions to reinstatement of his case. When plaintiff claimed that defendant had not timely provided plaintiff with documentation of defendant's reimbursable expenses, the court extended its thirty-day deadline for plaintiff to reinstate his case, even though defendant insisted it had provided the documentation. Plaintiff did not meet this extended deadline.
The court found that plaintiff never provided a reasonable explanation for his absence at trial. In his fourth letter, plaintiff finally offered the explanation that his lawyer had not informed him of the exact trial date. In its fourth and final order, dated November 28, 2001, the court considered this allegation and held it to be completely contrary to the evidence. Plaintiff also alleged he was absent because his lawyer told him that the court had already decided his case by the morning of September 17, 2001. The court found this second allegation "utterly preposterous and gratuitously insulting," and added that any disputes between plaintiff and his former lawyer regarding statements made by the lawyer were not relevant to plaintiff's case against defendant. The court ordered plaintiff to refrain from any further communication with the court, denied him any further relief, and instructed him to file an appeal with the Fifth Circuit if he desired further recourse. The court also observed,
Dillon has wasted more than his share of this Court's valuable resources and has abused the legal system unfairly and to the detriment of other more deserving litigants. His actions cost defendants thousands of dollars and even now, Dillon refuses to accept responsibility for his own inexplicable conduct. This farce must now come to an end.
(Order Denying Plaintiff Any Further Relief, attached to Def.'s Not. to Dismiss, Ex. 8.)
On December 26, 2001, plaintiff filed a notice of appeal in the Southern District of Texas, seeking the Fifth Circuit's review of the district court's dismissal. On January 18, 2002, with his appeal pending before the Fifth Circuit, plaintiff filed this lawsuit, alleging the same claims against defendant that he asserted in the Texas case. On July 23, 2002, the Fifth Circuit affirmed the district court's holding dismissing plaintiff's lawsuit and treated the dismissal as "tantamount to a dismissal with prejudice." The Fifth Circuit said that its dismissal was in effect with prejudice because the claim was barred by the applicable statute of limitations.
In the Louisiana case, this Court ordered plaintiff to appear on its call docket on June 12, 2002 and July 12, 2002. Plaintiff's case was passed for thirty days each time to allow plaintiff the opportunity to serve the defendant. Plaintiff finally served defendant with a summons on August 5, 2002, more than six months after he filed his complaint. Defendant did not file an answer because plaintiff did not include a copy of his complaint with the summons. See FED. R. Civ. P. 4(c).
On August 19, 2002, defendant filed this motion to dismiss or alternatively for summary judgment. On August 22, 2002, in accordance with Rule 11(c)(a), defendant sent plaintiff a letter advising him that filing his complaint violated Rule 11 and requesting that he voluntarily dismiss the action within twenty-one days to avoid possible sanctions. After that deadline passed, defendant filed its motion for Rule 11 sanctions on September 17, 2002. On September 30, 2002, this Court received a letter from plaintiff in which he did not address any of defendant's legal arguments, but instead complained that his former attorney did not inform him of his need to be present at his trial and that he had been unable to raise the pre-payment costs of reinstating his case in a timely manner.
The Court set oral argument on defendant's motions for October 23, 2002, at 10:00 a.m. Despite several conversations between plaintiff and this Court's law clerk regarding the time and purpose of the oral argument, plaintiff failed to appear at the hearing. Instead, he showed up in the judge's chambers after the hearing was over.
For the following reasons, the Court GRANTS defendant's motion for summary judgment on the grounds of res judicata and GRANTS defendant's motion to order Rule 11 sanctions against the plaintiff.
II. DISCUSSION
A. Legal Standard
Summary judgment is appropriate when there are no genuine issues as to any material facts, and the moving party is entitled to judgment as a matter of law. See FED. R. Civ. P. 56(c); Celotex Corp. v. Catrett, 477 U.S. 317, 322-323, 106 S.Ct. 2548, 2552 (1986). A court must be satisfied that no reasonable trier of fact could find for the nonmoving party or, in other words, "that the evidence favoring the nonmoving party is insufficient to enable a reasonable jury to return a verdict in her favor." Lavespere v. Niagara Mach. Tool Works, Inc., 910 F.2d 167, 178 (5th Cir. 1990) (citing Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 249, 106 S.Ct. 2505, 2511 (1986)). The moving party bears the burden of establishing that there are no genuine issues of material fact.
If the dispositive issue is one on which the nonmoving party will bear the burden of proof at trial, the moving party may satisfy its burden by merely pointing out that the evidence in the record contains insufficient proof concerning an essential element of the nonmoving party's claim. See Celotex, 477 U.S. at 325, 106 S.Ct. at 2554; see also Lavespere, 910 F.2d at 178. The burden then shifts to the nonmoving party, who must, by submitting or referring to evidence, set out specific facts showing that a genuine issue exists. See Celotex, 477 U.S. at 324, 106 S.Ct. at 2553. The nonmovant may not rest upon the pleadings, but must identify specific facts that establish a genuine issue exists for trial. See id. at 325, 106 S.Ct. at 2553-54; Little v. Liguid Air Corp., 37 F.3d 1069, 1075 (5th Cir. 1996).
B. Res Judicata
Under federal law, res judicata bars a subsequent action when a prior judgment has been rendered in an action in which: (1) the parties are the same in both suits, (2) the prior judgment was rendered by a court of competent jurisdiction, (3) there has been a final judgment on the merits, and (4) the same cause of action is involved in both cases. See Agrilectric Power Partners v. General Elec. Co., 20 F.3d 663, 664-65 (5th Cir. 1994) ; Nilsen v. City of Moss Point, Miss., 701 F.2d 556, 559 (5th Cir. 1983). When these four conditions are met, the parties cannot raise any claim or defense in the later action that was or could have been raised in the prior action. In re Howe, 913 F.2d 1138, 1144 (5th Cir. 1990). In this case, all four elements are precisely met. Plaintiff brought his complaint against the same defendant in both suits. The Fifth Circuit Court of Appeals is a court of competent jurisdiction. The Fifth Circuit rendered a final judgment on the merits by dismissing plaintiff's case with prejudice. See Kasper Wire Works v. Leco Engineering Machine, Inc., 575 F.2d 530, 534 (5th Cir. 1978); Burger v. United States, 2001 WL 1490736, *4 (E.D. La. 2001). Lastly, this lawsuit involves the same claims as the previous lawsuit, for negligence, unseaworthiness, and maintenance and cure.
This is a clear-cut case of res judicata. For the foregoing reasons, the defendant's motion for summary judgment on the grounds of res judicata is GRANTED.
C. Rule 11 Sanctions
This Court may impose appropriate sanctions, including attorney's fees and costs, upon a party who files a pleading in violation of Rule 11 of the Federal Rules of Civil Procedure. See Cooter Gell v. Hartmarx Corp., 496 U.S. 384, 393 (1990); Johnson v. Tuff-N-Rumble Mgmt., Inc., 2000 WL 622612, *6 (E.D. La. 2000). Rule 11 is applicable to all pleadings, whether submitted by an attorney or a pro se litigant. See Johnson, 2000 WL 622612 at *6; Hicks v. Bexar Cty., Texas, 973 F. Supp. 653, 687 (W.D. Tex. 1997), aff'd, 137 F.3d 1352 (5th Cir. 1997) (collecting cases). A litigant who submits a pleading to the court certifies to the best of his knowledge, information, and belief that: (1) the pleading is not interposed for any improper purpose, such as harassment, unnecessary delay, or increased costs of litigation; (2) the pleading is warranted by existing law or in good faith argument for modification of existing law; and (3) the litigant has conducted a reasonable inquiry into the factual allegations and denials which support the pleading. FED. R. Civ. P. 11(b); Childs v. State Farm Mutual Ins. Co., 29 F.3d 1018, 1023 (5th Cir. 1994); American Airlines, Inc. v. Allied Pilots Ass'n, 968 F.2d 523, 529 (5th Cir. 1992). A litigant is required to conduct a reasonable inquiry into the law before filing his pleading and may be subject to Rule 11 sanctions if he fails to do so. See Business Guides, Inc. v. Chromatic Communication Enters., Inc., 498 U.S. 533, 551 (1991); Jennings v. Joshua Indep. Sch. Dist., 948 F.2d 194, 197 (5th Cir. 1991). A party seeking Rule 11 sanctions must afford the offending party twenty-one days before presenting the motion to the court, so that the offending party can withdraw the claim or correct its defects. FED. R. Civ. P. 11(c)(a).
In the Fifth Circuit, it is well-settled that once a notice of appeal has been filed, a district court has no jurisdiction over any matters involved in the appeal. See Creations Unlimited, Inc. v. McCain, 112 F.3d 814, 816-17 (5th Cir. 1997); Sierra Club v. Cedar Point Oil Co., 73 F.3d 546, 578 (5th Cir. 1996); Henry v. Indep. Am. Savings Ass'n, 857 F.2d 995, 997-98 (5th Cir. 1988) ; 20 JAMES WM. MOORE ET AL., MOORE's FEDEPAL PRACTICE § 303.32 (3d ed. 2002) (explaining that this is "a judge-made doctrine, designed to promote judicial economy and avoid the confusion and inefficiency that might flow from putting the same issue before two courts at the same time.") In this case, plaintiff either failed to conduct a proper inquiry into this matter before filing his complaint in this Court, or knowingly ignored the law. Plaintiff had only two appropriate courses of action after the Southern District of Texas entered a dismissal without prejudice against him on September 17, 2001: either comply with the district court's condition to reinstatement of his case, or appeal the district court's decision to the Fifth Circuit. The district court judge repeatedly made these two options known to plaintiff. Plaintiff chose the latter option because he did not meet the district court's condition for reinstatement of his case.
The Court finds no authority to support a distinction between filing the same suit in a new district court or in the original court where it was filed. Either way, the action is improper because the filing of a notice of appeal divests a district court of jurisdiction over any matters involved in the pending appeal.
Defendant's August 22, 2002 letter to plaintiff expressly gave notice to plaintiff that filing his lawsuit in the Eastern District of Louisiana while his appeal was pending in the Fifth Circuit violated Rule 11 and might result in sanctions. ( See Def.'s Ex. 1.) Further, the letter stated that defendant believed plaintiff had filed the lawsuit in this Court for an improper purpose. ( See id.) In plaintiff's letter to this Court in opposition to defendant's motions, plaintiff offers no explanation as to why his filing of the same lawsuit in this Court is proper or does not deserve sanctions. Moreover, plaintiff raises the same complaints about his lawyer and his trial to this Court as he raised in the previous lawsuit, which the Southern District of Texas told plaintiff were "utterly preposterous and gratuitously insulting," as well as irrelevant. Plaintiff cannot argue that he did not know his conduct was improper. Further, defendant properly warned plaintiff that Rule 11 sanctions might be forthcoming and gave him the requisite twenty-one days to voluntarily dismiss his case.
In light of the foregoing, the Court finds that the only plausible explanation for plaintiff's conduct is that he filed this lawsuit to circumvent the order of the United States District Court in Texas requiring him to pre-pay defendant's expenses before reinstating his case. This violates Rule 11(b)(1) prohibiting a litigant from submitting a pleading that is interposed for an improper purpose. FED. R. Civ. P. 11(b)(1). Further, plaintiff's decision to file the same lawsuit in the Eastern District of Louisiana while his appeal in the Fifth Circuit was pending violates Rule 11(b)(2), which requires him to certify that the claims asserted are warranted by existing law. FED. R. Civ. P. 11(b)(2). The Court also observes that plaintiff failed to dismiss this suit after defendant served him with a Rule 11 motion and after the Fifth Circuit held that his claim was barred by the statute of limitations. In fact, he served defendant after the Fifth Circuit issued its ruling and continued to press his claim in response to defendant's motion.
Once a court finds that an unrepresented party has violated Rule 11, the Court has discretion to impose an appropriate sanction. FED. R. CIV. P. 11(c). Although the district court has broad discretion, the sanction imposed should be the "least severe sanction" adequate to deter future violations of Rule 11. See Merriman v. Security Ins. Co., 100 F.3d 1187, 1194 (5th Cir. 1996); Thomas v. Capital Sec. Services, 836 F.2d 866, 877-78 (5th Cir. 1988). The purpose of Rule 11 sanctions is to deter rather than to compensate. See FED. R. CIV. P. 11 advisory committee's notes. Sanctions may be monetary or nonmonetary and may include "striking the offending paper, issuing an admonition, reprimand, or censure; . . . ordering a fine payable to the court. . . ." See id. The rule expressly provides that a court may also award the movant some or all of the reasonable attorney's fees and other expenses incurred as a direct result of the Rule 11 violation. FED. R. CIV. P. 11(c)(2); see also Hicks, 973 F. Supp. at 689 (holding that amount of Rule 11 sanctions must be limited to those expenses actually and directly caused by the filing of the pleading found to violate Rule 11) ( citing Jennings, 948 F.2d at 199 (5th Cir. 1991); Bogney v. Jones, 904 F.2d 272, 274 (5th Cir. 1990)).
In determining whether to impose a sanction, the court should consider
[w]hether the improper conduct was willful, or negligent; whether it was a pattern of activity, or an isolated event; whether it infected the entire pleading, or only one particular count or defense; whether the person has engaged in similar conduct in other litigation; whether it was intended to injure; what effect it had on the litigation process in time or expense; whether the responsible person is trained in the law; what amount, given the financial resources of the responsible person, is needed to deter that person from repetition in the same case; what amount is needed to deter similar activity by other litigants. . . .
FED. R. CIV. P. 11 advisory committee's notes. The Court finds sanctions are in order given plaintiff's history in the Texas district court and his conduct in this Court, which have needlessly prolonged and increased the costs of this litigation.
Accordingly, the Court GRANTS defendant's motion for Rule 11 sanctions. The Court ORDERS that plaintiff's complaint be stricken and that he file no other pleadings in this lawsuit or on this claim in this Court. The Court further ORDERS that plaintiff pay to defendant attorney's fees in the amount of $3,250, which represents one-half of the fees defendant incurred in preparing and filing these motions and appearing for oral argument in court.
Defendant proved that it incurred attorney's fees in the amount of $7,561.35. This figure represents 41.90 hours of work at rates of $190/hour for the partner handling the case, $165/hour for the associate, and $90/hour for the paralegal, plus office and computer costs. Counsel for defendant indicates that these rates are lower than usual because the client is a longstanding one. Defendant's documentation of hours billed and costs expended is detailed and adequate. ( See Def.'s Ex. 2.)