Commercial Litigation and Arbitration

Inherent Power Sanctions Apt for Party’s Threats to Sue Witnesses, Opposing Counsel If They Fail to Comply with Demands — District Court Retains Jurisdiction to Sanction During Appeal, Needn’t Explain Why Sanctions Denied

Greene v. Indep. Pilots Ass'n, 2018 U.S. App. LEXIS 28271 (6th Cir. Oct. 4, 2018):

Douglas Walter Greene, a pro se plaintiff, appeals the district court's order imposing monetary sanctions against him and denying his cross-motion for sanctions against the Independent Pilots Association (IPA). This case has been referred to a panel of the court that, upon examination, unanimously agrees that oral argument is not needed. See Fed. R. App. P. 34(a).

Greene was a pilot for United Parcel Service (UPS) and a member of the IPA, the collective bargaining unit for UPS's pilots. UPS terminated Greene in 2013 after he refused to undergo a medical examination to determine whether he was fit to safely function as a crewmember. An arbitrator upheld Greene's termination, concluding that Greene's erratic behavior provided sufficient grounds under the collective bargaining agreement for UPS to order Greene to undergo a non-routine medical evaluation, and that Greene's refusal to submit to the examination provided just cause for UPS to terminate him for insubordination. See Greene v.Frost Brown Todd, LLC, Nos. 16-6761/6763/6772, 2017 WL 6210784, at *1 (6th Cir. Dec. 4, 2017). Greene sued the IPA [*2]  under the Railway Labor Act, for allegedly violating its duty of fair representation to him, and the Labor-Management Reporting and Disclosure Act, for allegedly retaliating against him because he had supported an opposition candidate for union president. The district court granted summary judgment to the IPA on both claims, and we affirmed. Seeid. at *2-3.

The district court granted Greene's attorney leave to withdraw in December 2015, and Greene represented himself from then on. In August 2016, the IPA moved for a restraining order and for sanctions against Greene, claiming that he had threatened and tried to intimidate a witness who provided a declaration in support of its motion for summary judgment. The district court concluded that Greene's conduct in litigating the case was "unacceptable," but it declined to grant the motion for sanctions because it had concluded that the IPA was entitled to summary judgment on the merits of Greene's claims. The district court, however, "caution[ed] Greene that by denying the IPA's motion, the Court is not condoning his behavior" and it "warned [Greene] that in any future litigation, the Court will not hesitate to impose appropriate sanctions."

The IPA filed another motion [*3]  for sanctions against Greene while his appeal of the district court's summary judgment order was pending in this court. The first basis for this motion was an email that Greene sent to UPS pilot Michael Starnes in August 2017. Starnes testified in Greene's arbitration hearing about a flight from Anchorage, Alaska to Louisville, Kentucky, during which Greene talked at length about his problems with UPS, UPS's assistant chief pilot, and the Kentucky Department of Revenue. Starnes thought that Greene's excessive focus on these issues distracted him from flying the aircraft and created a safety risk.

In his email to Starnes, under the subject line "Truthful Testimony," Greene claimed that UPS was leveraging an undisclosed drunk driving incident to coerce Starnes into helping it "target" other pilots, and he told Starnes that Starnes needed to come forward with the truth. Greene reminded Starnes that Starnes needed to demonstrate good moral character to maintain an airline transport pilot (ATP) certificate, see 14 C.F.R. § 61.153(c), and pointed out that falsification of documents and acting in a malicious manner towards others were grounds to revoke an ATP certificate. Greene claimed that UPS and [*4]  the IPA were violating federal criminal law by "protecting" Starnes, and he suggested that under the collective bargaining agreement UPS would not be required to reimburse Starnes if he were fined by the Federal Aviation  Administration (FAA). Greene urged Starnes to "set yourself free from the bondage that UPS has shackled you with by reaching out to me as soon as possible." Starnes felt that Greene's email was a threat to initiate legal proceedings against him unless he contacted Greene. Greene sent a similar letter to Starnes in 2015, as well as to two other witnesses in the case.

The second basis for the sanctions motion was a July 2017 email that Greene sent to the IPA's attorney when Greene served his appellate brief on the IPA. In the email, Greene demanded a monetary settlement from "ALL the complicit players" in order to "alleviate the necessity to pursue criminal charges of ALL those involved and exposing this criminal endeavor to the Court of Public Opinion next."

The IPA argued that the district court had inherent authority to sanction Greene for attempting to influence a witness's testimony, harassing witnesses and potential witnesses, and threatening to initiate baseless criminal [*5]  and bar disciplinary proceedings. The IPA asked the district court to enjoin Greene from threatening witnesses and opposing counsel with criminal prosecution and engaging in threatening, abusive, or intimidating communications, and to award it the attorney's fees and costs it incurred in bringing the motion.

Greene responded and filed a cross-motion for sanctions against the IPA. Much of Greene's response was devoted to relitigating the merits of his termination, and he continued to assert that UPS, the IPA, opposing counsel, and others were involved in a criminal conspiracy against him and that the district judge was biased against him. Greene, however, did argue that the district court lost jurisdiction to sanction him once he filed his notice of appeal and that his actions in contacting witnesses were protected by 18 U.S.C. § 1512(e), which provides an affirmative defense to a charge of witness tampering if "the defendant's sole intention was to encourage, induce, or cause the other person to testify truthfully." Greene claimed that counsel for the IPA made false statements about him and defamed him in its motion for sanctions and engaged in other alleged fraudulent activities before [*6]  the district court. Greene asserted counter-charges of witness tampering by counsel, and he sought sanctions of his own against the IPA in the amount of $50 million.

After we affirmed the district court's order granting summary judgment to the IPA, the district court issued an order granting the IPA's motion for sanctions and denying Greene's motion for sanctions. The district court found that Greene acted in bad faith, vexatiously, wantonly, and for oppressive reasons throughout the case, and that as a result it had authority to sanction Greene for his misconduct pursuant to its inherent authority to protect the integrity of the proceedings. The district court first revisited Greene's misbehavior that generated the IPA's first motion for sanctions and its decision to caution Greene about his conduct, which included Greene's use of foul language, his derogatory comments about individuals involved in or associated with the case, and his inappropriate contacts with witnesses in the case. The court then found that despite its warning, Greene continued to engage in misconduct with his inappropriate and threatening emails to Starnes and opposing counsel. And sealing the district court's decision [*7]  to sanction Greene was his response to the IPA's motion for sanctions, which the court found was replete with insults and baseless accusations of conspiratorial and other criminal conduct by UPS, the IPA, opposing counsel, and the court itself. The district court concluded that "Greene's conduct, both with respect to his contacting individuals via email with thinly-veiled, and sometimes outright, threats of criminal prosecution, coupled with his insistence that witnesses change their statements" fell squarely within its inherent authority to sanction him. The court therefore awarded the IPA the attorney's fees and costs it incurred in bringing its sanctions motion, which was approximately $9300. In light of its decision to grant the IPA's motion for sanctions, the court denied Greene's cross-motion for sanctions, concluding that his allegations of misconduct against opposing counsel were unfounded.

We review a district court's decision to sanction a party pursuant to its inherent authority for an abuse of discretion. See Metz v. Unizan Bank, 655 F.3d 485, 489 (6th Cir. 2011). A district court abuses its discretion if it bases its decision on an erroneous view of the law or on clearly erroneous findings of fact. See United States v. Llanez-Garcia, 735 F.3d 483, 497-98 (6th Cir. 2013); First Bank of Marietta v. Hartford Underwriters Ins. Co., 307 F.3d 501, 510 (6th [*8] Cir. 2002). A district court may assess an award of attorney's fees under its inherent powers if a party has acted in bad faith, vexatiously, wantonly, or for oppressive reasons. See Metz, 655 F.3d at 491-92. "Because inherent powers are shielded from direct democratic controls, they must be exercised with restraint and discretion." Roadway Exp., Inc. v. Piper, 447 U.S. 752, 764 (1980).

First, the district court retained ancillary jurisdiction to sanction Greene for misconduct even though his appeal was pending in this court because the IPA's sanctions motion was a collateral matter that was not related to the merits of the case. See Kallok v. Boardman LocalSch. Dist. Bd. of Educ., 24 F. App'x 496, 498 (6th Cir. 2001); see also Mitan v. Int'l Fid. Ins. Co., 23 F. App'x 292, 298 (6th Cir. 2001) ("The federal courts' inherent power to protect the orderly administration of justice and to maintain the authority and dignity of the court extends to a full range of litigation abuses.").

Second, the district court reasonably interpreted Greene's emails to Starnes and the IPA's counsel as threats to initiate unfounded legal proceedings against them if they did not comply with his demands. And the district court was rightfully concerned that Greene's email to Starnes was an attempt to intimidate Starnes into providing testimony that complied with Greene's view of UPS's decision to terminate his [*9]  employment. Indeed, Greene's email insinuated that he would see that the FAA would revoke Starnes's pilot's license if Starnes did not "reach out" to him. The district court therefore did not clearly err in finding that Greene's correspondence with Starnes and opposing counsel was not sent in good faith, particularly in view of its previous admonition to Greene to cease this behavior. Consequently, the district court did not abuse its discretion in sanctioning Greene for his misconduct. Cf. Kelly v. Panama Canal Comm'n, 26 F.3d 597, 603 (5th Cir. 1994) (affirming the district court's award of monetary sanctions against an attorney who threatened a witness with criminal sanctions if he testified).

Third, Greene's motion for sanctions against the IPA's counsel and his demand for $50 million dollars in damages were patently frivolous, and the district court did not abuse its discretion in rejecting it. Cf. Runfola & Assocs., Inc. v. Spectrum Reporting II, Inc., 88 F.3d 368, 375 (6th Cir. 1996) (stating that a district court is not required to explain its reasons for denying sanctions).

Accordingly, we AFFIRM the district court's order granting the IPA's motion for sanctions and denying Greene's motion for sanctions.

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