Commercial Litigation and Arbitration

Rule 11 and Res Judicata — Eleventh Circuit’s Three-Part Test for § 1927 Sanctions

From Meidinger v. Healthcare Indus. Oligopoly, 2010 U.S. App. LEXIS 16448 (11th Cir. Aug. 9, 2010):

[Rule 11 and Res Judicata]

"A plaintiff may be sanctioned under Rule 11 for filing claims barred by res judicata." Thomas [v. Evans, 880 F.2d 1235, 1240 (11th Cir. 1989).

[Note: Because res judicata is an affirmative defense, this holding is not a compelled one.]

[§ 1927 Sanctions]

[T]he plain language of the statute imposes three essential requirements: (1) the attorney must engage in unreasonable and vexatious conduct; (2) that conduct must multiply the proceedings; and (3) the amount of the sanction must bear a "financial nexus to the excess proceedings." Peterson v. BMI Refractories, 124 F.3d 1386, 1396 (11th Cir. 1997). We also have stated that § 1927 must be "strictly construed" because it is "penal in nature." ***

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