Sanctions Not Appropriate for Presenting Issues of First Impression — Litigants Should Not Be Deterred from Advancing Any Supportable Position (Good Quotes)

From Mid-Continent Cas. Co. v. Eland Energy, Inc., 2011 U.S. Dist. LEXIS 63493 (N.D. Tex. June 14, 2011):

Mid-Continent has failed to demonstrate that Sundown has practiced a fraud upon this court or defiled the very temple of justice, or that it has acted in bad faith, vexatiously, wantonly, or for oppressive reasons. Mid-Continent's demand for attorney's fees is based entirely on Sundown's pursuit of a theory that the court has held is unsupported under existing law (i.e., that an insured can place a claim in abeyance). Sundown did not act in bad faith simply by presenting a novel theory of law. "[S]anctioning a party for presenting an issue of first impression would not be permissible, as it would unduly chill advocacy." Macklin v. City of New Orleans, 300 F.3d 552, 554 (5th Cir. 2002) (citing Estiverne v. Sak's Fifth Ave., 9 F.3d 1171, 1174 (5th Cir. 1993) (per curiam)). Moreover, the court should not "deter any litigant from advancing any claim or defense which is arguably supported by existing law, or any reasonably based suggestion for its extension, modification, or reversal . . . although they may be unsuccessful[.]" Farguson v. MBank Hous., N.A., 808 F.2d 358, 359 (5th Cir. 1986).

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