Commercial Litigation and Arbitration

Civility with Teeth — Inherent Power Sanctions for Failing to Inform Law Firm Defendants of Claim Before Suit — Statutorily-Authorized Fees Withheld

The plaintiff in Sahyers v. Prugh, Holliday & Karatinos, P.L., 2009 U.S. App. LEXIS 5037 (11th Cir. Mar. 3, 2009), was a paralegal suing her former law firm and its partners for failure to pay overtime required by the Fair Labor Standards Act, under which a prevailing plaintiff is entitled to an award of some reasonable attorney's fees and costs. 29 U.S.C. § 216(b). After the plaintiff refused to settle the case for less than $25,000 (or $35,000, depending on whom you ask), the defendants served a Rule 68 offer of judgment for $3,500, which the plaintiff accepted. The District Court refused to award attorneys' fees, as an inherent power sanction for the plaintiff’s lack of civility in springing the lawsuit on the defendants unannounced:

A federal court may wield its inherent powers over the lawyers who practice before it. This control derives from a lawyer's role as an officer of the court. Theard v. United States, 77 S. Ct. 1274, 1276 (1957). It encompasses, among other things, the authority to police lawyer conduct and to guard and to promote civility and collegiality among the members of its bar. See, e.g., Chambers, 111 S. Ct. at 2132 ("[A] federal court has the power to control admission to its bar and to discipline attorneys who appear before it."); In re Finkelstein, 901 F.2d 1560, 1564 (11th Cir. 1990); (court has power to supervise professional conduct of lawyers who practice before it).

[Footnote 4.] As Justice Cardozo (then-Chief Judge of the New York Court of Appeals) once observed: "Membership in the bar is a privilege burdened with conditions. [A lawyer is] received into that ancient fellowship for something more than private gain. He [becomes] an officer of the court, and, like the court itself, an instrument or agency to advance the ends of justice." People ex rel. Karlin v. Culkin, 248 N.Y. 465, 470-71 (1928).

[Footnote 5] We believe and defend the idea that maintaining a bar that promotes civility and collegiality is in the public interest and greatly advances judicial efficiency: better "to secure the just, speedy and inexpensive determination of every action and proceeding," as Rule 1 demands. For background, see Fed. R. Civ. P. 1.

In exercising its powers, a court need not free a client from the acts of his lawyer, especially when the client is aware of or directs those acts. See Jochum v. Schmidt, 570 F.2d 1229, 1232 n.5 (5th Cir. 1978) ("[F]ailing to impose sanctions [] merely because the plaintiff should not be penalized for the omissions of his own attorney would be visiting the sins of the plaintiff's lawyer on the defendant.") (internal quotation marks omitted); Anderson v. United Parcel Serv., 915 F.2d 313, 316 (7th Cir. 1990) ("There is no injustice in holding a client responsible for acts of his attorney of which he is aware."). A court, therefore, may deny an award of litigation expenses to which a client is otherwise entitled. See Litton Sys., Inc. v. Am. Tel. & Tel. Co., 700 F.2d 785, 827-28 (2d Cir. 1983).

The district court's inherent powers support its decision here. Defendants are lawyers and their law firm. And the lawyer for Plaintiff made absolutely no effort — no phone call; no email; no letter — to inform them of Plaintiff's impending claim much less to resolve this dispute before filing suit. Plaintiff's lawyer slavishly followed his client's instructions and — without a word to Defendants in advance — just sued his fellow lawyers.

[Footnote 7.] This explanation counts for little: a lawyer's duties as a member of the bar — an officer of the court — are generally greater than a lawyer's duties to the client. See Malautea v. Suzuki Motor Co., 987 F.2d 1536, 1546 (11th Cir. 1993) ("An attorney's duty to a client can never outweigh his or her responsibility to see that our system of justice functions smoothly. This concept is as old as common law jurisprudence itself."); Thomas v. Tenneco Packaging Co., 293 F.3d 1306, 1327 (11th Cir. 2002) ("Independent judgment is an essential ingredient of good lawyering, since attorneys have duties not only to their clients, but also, as officers of the court, to the system of justice as a whole.") (internal quotation marks omitted). Plaintiff's lawyer showed little concern for the district court's time and energy and no courtesy to his fellow lawyers.

As the district court saw it, this conscious disregard for lawyer-to-lawyer collegiality and civility caused (among other things) the judiciary to waste significant time and resources on unnecessary litigation and stood in stark contrast to the behavior expected of an officer of the court. The district court refused to reward — and thereby to encourage — uncivil conduct by awarding Plaintiff attorney's fees or costs. Given the district court's power of oversight for the bar, we cannot say that this decision was outside of the bounds of the district court's discretion.

[Footnote 9.] We have said that a court may not sanction a lawyer under its inherent powers absent a showing "that the lawyer's conduct constituted or was tantamount to bad faith." Thomas, 293 F.3d at 1320 (internal quotation marks omitted). We have assumed that awarding no attorney's fees and costs constitutes some informal sanction. Nevertheless, even if bad faith is required, we conclude that the conscious indifference to lawyer-to-lawyer collegiality and civility exhibited by Plaintiff's lawyer (per his client's request) amounted to harassing Defendants' lawyers by causing them unnecessary trouble and expense and satisfied the bad-faith standard.

We strongly caution against inferring too much from our decision today. These kinds of decisions are fact-intensive. We put aside cases in which lawyers are not parties. We do not say that pre-suit notice is usually required or even often required under the FLSA to receive an award of attorney's fees or costs. Nor do we now recommend that courts use their inherent powers to deny prevailing parties attorney's fees or costs. We declare no judicial duty. We create no presumptions. We conclude only that the district court did not abuse its discretion in declining to award some attorney's fees and costs based on the facts of this case.

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