Commercial Litigation and Arbitration

FRAP 38 Sanctions — Not Just for Frivolousness But Also for “Blatant Misrepresentations” — Good Quotes: (1) Weak, “Almost Hopeless” ≠ Frivolous, (2) Sleeping on One’s Rights and (3) Pointlessness of Epithets in Court Filings

Candelario-Del-Moral v. UBS Fin’l Servs. Inc. (In re Efron), 2014 U.S. App. LEXIS 5322 (1st Cir. Mar. 21, 2014):

For over four centuries, persons learned in the law have known that, when litigation is in prospect, vigilance is good and somnolence is bad. Commentators and courts have phrased this sentiment in different ways. See, e.g., In re Wood, [1883] 23 Ch.D. 644 at 653 (Eng.) ("It is a reasonable presumption that a man who sleeps upon his rights has not got much right."); Edmund Wingate, Maxims of Reason (1658) ("Laws come to the assistance of the vigilant, not of the sleepy."). The lesson to be derived is that "[t]he law ministers to the vigilant not to those who sleep upon perceptible rights." Puleio v. Vose, 830 F.2d 1197, 1203 (1st Cir. 1987). This appeal illustrates the wisdom of that statement.


C. Sanctions.

After Efron appealed, Candelario moved for sanctions on the ground that the appeal was frivolous. A duty panel of this court referred the motion to this merits panel for disposition. We now address that motion.

Candelario's motion for sanctions invokes Federal Rule of Appellate Procedure 38 and its counterpart, 1st Cir. R. 38.0. Rule 38 affords the court of appeals discretion to "award just damages and single or double costs to the appellee" if the court "determines that an appeal is frivolous."  Fed. R. App. P. 38. An appeal is frivolous if the arguments in support of it are wholly insubstantial and the outcome is obvious from the start. See Cronin v. Town of Amesbury, 81 F.3d 257, 261 (1st Cir. 1996) (per curiam). Put another way, an appeal is frivolous "when the appellant's legal position is doomed to failure -- and an objectively reasonable litigant should have realized as much from the outset." Toscano v. Chandris, S.A., 934 F.2d 383, 387 (1st Cir. 1991).

By dint of judicial interpretation, the scope of Rule 38 has been enlarged to reach beyond frivolousness simpliciter. See, e.g., In re Simply Media, Inc., 583 F.3d 55, 56-57 (1st Cir. 2009) (per curiam). Thus, we have sanctioned various shortcomings above and beyond frivolousness under the aegis of Rule 38. See, e.g., Thomas v. Digital Equip. Corp., 880 F.2d 1486, 1491 (1st Cir. 1989) (imposing Rule 38 sanctions for "blatant misrepresentations in [an] appellant's brief" (internal quotation mark omitted)). So, too, Local Rule 38.0 authorizes sanctions not only for frivolous appeals but also for vexatious litigation conduct. See Jasty v. Wright Med. Tech., Inc., 528 F.3d 28, 34 (1st Cir. 2008).

Candelario serves up a menu of grievances. To whet our appetite, she lambastes Efron's noncompliance with the briefing schedule. As a side dish, she calumnizes a number of statements contained in Efron's appellate filings as false and misleading. The main course is her insistence that the appeal itself has been frivolous from the start.

We can quickly dispose of her first argument. At the time that Candelario moved for sanctions, Efron's brief was one week overdue. While an appellant who files his briefs out of time risks dismissal of his appeal, see 1st Cir. R. 45.0, the untimely filing in this case occasioned only a brief delay. To impose sanctions would be tantamount to using an elephant gun to kill a fly.

The claimed misrepresentations present a different type of problem. An appellate court lacks the factfinding capability of a trial court; and we are not prepared to choose, on this algid record, between the parties' wildly conflicting versions of the truth.

This brings us to the principal thrust of Candelario's argument: her assertion that the appeal lacked any vestige of merit and should not have been taken at all. This argument presents a closer question.

Given his protracted delay, Efron's case for intervention was manifestly weak. But "weak" is not synonymous with "frivolous." "[A]n appeal can be weak, indeed almost hopeless, without being frivolous . . . ." Lallemand v. Univ. of R.I., 9 F.3d 214, 217-18 (1st Cir. 1993). In the last analysis, we think that the case-specific nature of timeliness determinations counsels against saying that Efron "had no legitimate ground for pursuing this appeal." E.H. Ashley & Co. v. Wells Fargo Alarm Servs., 907 F.2d 1274, 1280 (1st Cir. 1990). We therefore decline Candelario's invitation to sanction Efron simply for prosecuting the appeal.3

3   In her brief on appeal, Candelario endeavors to expand the dimensions of her motion to include, as additional grounds for sanctions, 28 U.S.C. § 1927 and this court's inherent power. While we may have discretion to allow such an expansion, it would be pointless to do so here. The same reasons that lead us to deny sanctions under Rule 38 are sufficient to ground a denial of sanctions under section 1927 and this court's inherent power.

Let us be perfectly clear. Our denial of sanctions should not be taken as an endorsement of Efron's decision to appeal. Although we have determined that Efron did not cross the line by appealing, he came perilously close to doing so.4

4   We add, moreover, that neither Efron nor Candelario gains any advantage from the incessant hurling of epithets. Rancor and petulance are not attractive qualities, and giving vent to them rarely if ever advances a litigant's cause.

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