Commercial Litigation and Arbitration

Order for New Trial Based on Misconduct of Counsel Does Not Constitute Appealable Sanctions Order — Circuit Split as to Whether and When Order Containing Criticism Comprises a Sanction

From In re Metropolitan Gov’t of Nashville and Davidson County, TN, 2010 U.S. App. LEXIS 11368 (6th Cir. 2010), a contentious employment discrimination action:

2. Attorney sanctions as a basis to appeal

Metro's alternative contention is that we have jurisdiction over this case because the district court's order amounts to a finding that Metro's counsel committed sanctionable misconduct. In some circuits, a "particularized finding of misconduct" by a district court constitutes enough of an injury to make that finding appealable. See United States v. Barnett (In re Harris), 51 F. App'x 952, 956 (6th Cir. 2002) (citing cases). This circuit, however, has never reached such a conclusion. See id. at 956-57 (explaining that "[t]his court has not yet addressed the extent to which a district court's written order can constitute a sanction" that would create an injury sufficient to provide standing to appeal).

Moreover, the circuits vary in how they apply this rule. See, e.g., Bowers v. NCAA, 475 F.3d 524, 542-44 (3d Cir. 2007) (holding that attorneys whose behavior was declared sanctionable could appeal despite not receiving "any additional monetary or disciplinary sanctions . . . beyond factual findings and language in the actual order that the conduct of those attorneys merited sanctions"); Butler v. Biocore Med. Techs., Inc., 348 F.3d 1163, 1166, 1168-69 (10th Cir. 2003) (allowing attorneys to appeal orders that "directly aggrieve them"); Williams v. United States (In re Williams), 156 F.3d 86, 90-93 (1st Cir. 1998) (allowing attorneys to appeal orders criticizing their conduct only where the district court identified the criticism as a reprimand or a sanction); Walker v. City of Mesquite, 129 F.3d 831, 832-33 (5th Cir. 1997) (allowing an appeal from a district court's order reprimanding an attorney for misconduct despite the lack of a fine or other punishment); Clark Equip. Co. v. Lift Parts Mfg. Co., 972 F.2d 817, 820 (7th Cir. 1992) (rejecting an attorney's attempt to appeal a district court order that was critical of his conduct where he could not show that he suffered any monetary harm from the criticism).

Metro offers no argument for why we should set a new precedent by declaring that an attorney who is sanctioned or, as in this case, who is found to have prejudiced a trial based on improper conduct, suffers an appealable injury. It also fails to make any argument about why, if we do establish such a precedent, we should adopt the most lenient standard available.

Moreover, we find the reasoning in our unpublished decision in Barnett, which dealt with very similar circumstances, to be persuasive. The district court in that case accused the federal prosecutor of knowingly presenting perjured testimony after several government witnesses testified inconsistently about their level of illegal activity. Barnett, 51 F. App'x at 953-55. When the jury returned a verdict convicting Barnett, the district court granted a motion for a new trial, partially on the ground that the prosecutor knowingly introduced false testimony…. The case was retried and Barnett was convicted once again. After the retrial, the prosecutor filed an appeal challenging the order granting a new trial, arguing "that the district court's findings as to her conduct constitute an appealable sanction." ***

The opinion in Barnettexplained that "even if this court were to adopt the position that an order containing particularlized findings of professional misconduct is an appealable sanction, [the prosecutor] fails to demonstrate that the district court made such a finding." *** In that case, the district court repeatedly stated that it was not finding the prosecutor guilty of misconduct, and instead simply addressed her conduct "in the context of its legal conclusions."

This treatment of alleged misconduct in Barnettparallels how the district court in the present case dealt with Metro's counsel. The court here never specifically sanctioned or formally charged Metro's counsel with misconduct. Instead, the court simply relied on its conclusion that Metro's counsel had prejudiced the jury as part of its rationale for granting a new trial.

Indeed, the prosecutor in Barnettmay have had an even a stronger argument that she suffered an appealable injury because the district court in that case sent a letter to the Department of Justice suggesting an investigation into her possible misconduct (although the sending of such a letter is, in itself, plainly not appealable)…. Nothing similar was done by the district court in the present case. Also noteworthy is the fact that, in Barnett, the prosecutor herself attempted to appeal the district court's ruling. Here, Metro, not Metro's trial counsel, is attempting to appeal, which provides an even less compelling reason to take up the issue of attorney sanctions on an interlocutory basis. [Ed. note: This means there is likely no jurisdiction for this appeal.]

Furthermore, unlike Barnettwhere the case was retried before the prosecutor brought an appeal challenging the district court's order criticizing her conduct, Metro in the present case seeks to appeal the district court's ruling without waiting for a retrial. If we were to find standing to appeal in a case like this, parties would be able to file interlocutory appeals in cases where an attorney's allegedly prejudicial conduct was used as a basis to grant a new trial, effectively opening a "back door" method of appealing such orders. We would thus be creating a hybrid system for the review of orders granting new trials, where those that relied on alleged attorney misconduct would be immediately appealable but those that relied on other grounds would not. Creating this disparity is unwarranted, especially because Metro — should it lose a second trial — will eventually be able to attack the district court's decision on appeal. See Duncan v. Duncan, 377 F.2d 49, 52 (6th Cir. 1967) ("Although an order granting a new trial is generally not appealable, it is clear that such orders are reviewable on appeal from the final judgment in the second trial."). We thus reject Metro's contention that we have jurisdiction to consider Metro's appeal by means of reviewing the district court's purported finding of alleged attorney misconduct.

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