Commercial Litigation and Arbitration

FRAP 38 / § 1927 Sanctions on Appeal Permissible for Failure to Engage Substantively with Cases District Court Relied on or If Appeal Brought Solely to Delay

B. Bowles's Motion for Fees, Costs, and Sanctions

In re De La Madrid (De La Madrid v. Bowles Custom Pools & Spa, 2016 U.S. App. LEXIS 5626 (1st Cir. Mar. 25, 2016):

This appeal arises from a dispute whether the bankruptcy court erred in enlarging time for a creditor to file an unsecured claim. Appellant Julio Enrique Gil-De La Madrid, debtor to Appellee Bowles Custom Pool & Spa, appeals the district court's order affirming the bankruptcy court's decision to permit Bowles to file an unsecured claim after the initial statutory ninety-day deadline from the date of the initial creditors' meeting had passed.1 Because this deadline fell in a period between the case's dismissal and subsequent reinstatement, the bankruptcy court reset the deadline to account for the time the case was dismissed and accepted Bowles's claim as timely. We affirm. We also deny Bowles's motion for attorney fees, costs, and/or sanctions.


Arguing that this appeal is frivolous, Bowles moves under Rule 38 of Appellate Procedure and in the alternative under 28 U.S.C. § 1927 for payment of costs and attorney fees. That rule provides that "if a court of appeals determines that an appeal is frivolous, it may, after a separately filed motion or notice from the court and reasonable opportunity to respond, award just damages or single or double costs to the appellee." Section 1927, by contrast, specifically penalizes attorney conduct, such that "[a]ny attorney . . . who so multiplies the proceedings in any case unreasonably and vexatiously may be required by the court to satisfy personally the excess costs, expenses, and attorney's fees reasonably incurred because of such conduct."

According to Bowles, this appeal was filed purely as a delay tactic to keep creditors at bay, and has no basis in law or fact. Bowles further argues that Appellant's attempt to raise before this court an objection to the imposition of attorney fees in the state of Florida "is a [*10]  sign of temerity which warrants a finding that the appeal is frivolous."

The failure to engage substantively with cases on which a lower court has based its decision has, in the past, merited sanctions in this court. See Natasha, Inc. v. Evita Marine Charters, Inc., 763 F.2d 468, 472 (1st Cir. 1985) ("An appeal is frivolous when the result is obvious, or the arguments are 'wholly without merit.'") (internal citation and quotation marks omitted). This court has also granted fees in instances where an appeal had been brought solely for an improper purpose to delay legal proceedings. Alessandri v. April Ind., Inc., 934 F.2d 1, 3 (1st Cir. 1991).

Here, however, Appellant's arguments concerning the express language of the Rules of Bankruptcy Procedure are not altogether frivolous. While we interpret them to allow for the recalculation of time in this case, Rules 3002(c) and 9006 do narrowly define the scope of circumstances in which courts may reset claim filing deadlines. Bowles furthermore offers no evidence that either Appellant or his counsel engaged in unreasonable or vexatious behavior meriting sanctions. We therefore deny this motion.

IV. Conclusion

For the aforementioned reasons, we affirm the bankruptcy court's decision to extend the filing deadline and accept Bowles's claim as timely. We deny Bowles's motion for costs, fees, and sanctions. [*11]


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