Opinion
CIVIL ACTION NO. 02-1848
July 22, 2003
MEMORANDUM AND ORDER
This is a bad faith claim brought by plaintiff, Buster Younis, to recover damages against defendant, The Infinity Group after the parties reached a delayed settlement of an auto insurance claim. This action itself has had a tortured history due to numerous discovery disputes and delays. Finally, only days before the scheduled trial, and after the deadline for dispositive motions had passed, plaintiff filed several motions, including a motion for sanctions and a motion for default judgment, in which it was brought to the Court's attention that in addition to disregarding all other deadlines, including that for the filing of a pre-trial memorandum and proposed findings of fact and conclusions of law, defendant had never filed an Answer to the Complaint. The pleadings having been closed for some time, this Court had no choice but to grant default judgment and to schedule trial on the issue of damages only. At that time, this Court reserved consideration of the motion for sanctions against defendant to be dealt with during the trial on damages. Even after this Order, defendant still failed to comply with the next date ordered for the submission of his pre-trial memorandum and proposed findings of fact and conclusions of law. Also, after that time, the discovery disputes between the parties continued. This Court held a telephone conference resulting in a subpoena being quashed and received copies of correspondence regarding defendant's failure to produce portions of a claims manual, which had been ordered to be produced last year.
Finally, after the trial on damages was postponed and rescheduled for July 15, 2003, the motions now pending were filed. On June 27, 2003, plaintiff filed a Motion in Limine seeking to preclude defendant from offering any evidence and specifically seeking to preclude defendant from offering any evidence or cross-examining plaintiff regarding his use of the name "Johnny Bull" or anything that happened while plaintiff was known by that name. On June 25, 2003, defendant filed a Motion for Rule 11(B) sanctions. Defendant has now, nine months after defendant admitted during a deposition that he used the name "Johnny Bull" as an alternate identity, investigated and learned that he allegedly filed other auto insurance claims under this alternate name and recovered for the same injuries. As a result, defendant now seeks sanctions alleging that plaintiff's counsel had a duty to investigate. Defendant also seeks to recover the $15,000 which was paid to plaintiff in the underlying insurance settlement, as well as attorney's fees and seeks to have this matter, in which judgment has already been entered, dismissed. After receipt of defendant's motion, plaintiff s counsel contacted this Court to indicate that she was meeting with her client. After this consultation, plaintiff filed a Praecipe to have the Judgment Marked Satisfied. Plaintiff then filed a response to the motion indicating that defendant failed to comply with the 21-day safe harbor provision contained in Rule 11, which requires that the motion be served upon opposing counsel 21 days prior to being filed with the Court in order to allow the party to voluntarily withdraw the pleading. Not having been given this opportunity, plaintiff's counsel quickly responded after receiving the motion and made requests upon defendant to withdraw the motion. As a result of defendant's refusal to withdraw the motion without repayment of the underlying $15,000, plaintiff now once again seeks attorneys' fees and sanctions against defendant.
When filing this motion, defendant's counsel also claimed, without citing any authority, that a magistrate judge lacks the authority to grant Rule 11 sanctions and requests that the Motion be transferred to the Court judge. While a Rule 11 Motion is not dispositive, we note in this regard, that the same counsel now making this assertion, signed a Consent to the Exercise of Jurisdiction by a United States Magistrate, voluntarily consenting to have a Magistrate Judge handle "any and all further proceedings in the case, including the trial, order the entry of final judgment, and conduct all post-judgment proceedings" in accordance with the provisions of 28 U.S.C. § 636(c) and Fed.R.Civ.P. 73. We therefore proceed to decide the motion pursuant to the consents signed by the parties.
Due to the complete lack of diligence by all parties in this matter, we decline to grant sanctions against anyone. We also decline to reopen this matter to allow defendant to attempt to recover the underlying settlement as part of this action when pleadings are and have been closed. We note that plaintiff's alleged conduct was fraudulent and we find it to be reprehensible, as was the handling of this entire matter. We therefore, dismiss this action, requiring the parties to pursue any additional related claims independent of this action. Accordingly, we issue the following Order:
ORDER
AND NOW this 22nd day of July, 2003, upon consideration of Defendant's Motion for Rule 11(B) Sanctions and Plaintiff's Response thereto, and it appearing that Defendant did not comply with the 21-day safe harbor provision set forth in the Rule, and given the fact that Plaintiff after receiving said motion has filed a Praecipe to have the judgment marked satisfied, it is hereby ORDERED that:
1. Defendant's Motion for Rule 11(B) Sanctions and all other relief requested therein is DENIED;
2. Plaintiff's Motion In Limine is DENIED as moot;
3. Plaintiff's Motion for Sanctions, which was left open for consideration during the trial on damages is DENIED as moot;
4. Plaintiff's current request for sanctions is DENIED; and
5. This action is DISMISSED WITH PREJUDICE.
It is so ORDERED.