Hale v. U.S. Trustee

Procedural entryThis page is a short order in Hale v. U.S. Trustee. Read the opinion of the Court — 509 F.3d 1139
Court of Appeals for the Ninth Circuit·Decided December 10, 2007·No. 06-35349·Published

Opinion

FOR PUBLICATION

UNITED STATES COURT OF APPEALS FOR THE NINTH CIRCUIT

TOM HALE,  No. 06-35349 Appellant,

v.  D.C. No.

CV-04-00289-EJL

U.S. TRUSTEE, OPINION

Appellee.

Appeal from the United States District Court for the District of Idaho Edward J. Lodge, District Judge, Presiding

Submitted November 8, 2007* Seattle, Washington

Filed December 10, 2007

Before: William C. Canby, Jr., Susan P. Graber, and Ronald M. Gould, Circuit Judges.

Opinion by Judge Graber

*The panel unanimously finds this case suitable for decision without oral argument. Fed. R. App. P. 34(a)(2).

16189

HALE v. U.S. TRUSTEE 16191

COUNSEL

Tom Hale, Shelly, Idaho, appellant in propria persona.

Gary L. McClendon, United States Department of Justice, Boise, Idaho, for the appellee.

OPINION

GRABER, Circuit Judge:

Appellant Tom Hale assisted Debtors Eric and Selina Jones in filing a bankruptcy petition. The bankruptcy court found 16192 HALE v. U.S. TRUSTEE that, in doing so, Hale failed to honor his legal and ethical obligations as their lawyer. The bankruptcy court denied Hale’s motion requesting judicial recusal, denied his request for a jury trial on the reasonableness of his attorney fees, disgorged him of his attorney fees, and sanctioned him. The district court affirmed those rulings, and Hale timely appealed. On appeal, he raises only the attorney fees and sanction issues. We affirm.

FACTUAL AND PROCEDURAL HISTORY

Hale provided “PRE-FILING legal services” to Debtors pursuant to a signed disclosure agreement. For a $250 fee, he agreed to analyze Debtors’ financial situation and prepare their bankruptcy petition and required exhibits, but disclaimed representing them at the meeting of creditors required under 11 U.S.C. § 341. In addition, the agreement specified that Hale’s representation “d[id] not include the following services : Adversary proceedings, appeals, and/or conversions, non-dischargeability proceedings, or any other representation .” Hale refers to this practice as providing “unbundled” legal services to “pro se” debtors.

In 2001, Debtors filed for bankruptcy pro se. Hale did not sign the petition. The bankruptcy petition listed the $250 fee paid to Hale and explained that the fee covered “preparation, assistance, pro se advice and counsel, pre-filing, to obtain discharge order, or confirmation of plan.”

Shortly after Debtors filed their petition, the bankruptcy court ordered sua sponte that Hale account for the $250 fee. The order stated that “there is inadequate information in the record to allow the Court to determine whether amount received by Counsel is reasonable under the circumstances.” The court requested an itemization of all services that Hale had rendered to Debtors, including “a detailed and specific description of each individual item of service rendered; the name of the individual who rendered each such service; the

HALE v. U.S. TRUSTEE 16193 date such service was rendered; and the time expended in rendering such service.”

A few days later, the United States Trustee issued a notice of intent to seek sanctions against Hale for his failure to sign the petition. The notice alleged that this omission violated Federal Rule of Bankruptcy Procedure 9011(a).

Hale submitted an itemization, but the bankruptcy court ruled that the itemization was “incomplete and not fully in compliance” with its order. The court explained that the itemization “use[d] a generic description of services with no detail.” The court ordered that Hale supplement his itemization within 15 days.

About three weeks after the expiration of that 15-day period, Hale submitted a 15-page supplemental itemization. For most of the 15 pages, he took issue with the bankruptcy court’s inquiry into his fee. For example:

This is not the first time that I have attempted to protect the debtors and myself from the judicial tyranny that flows from the chambers of a biased Judge.

....

Judge Terry L. Myers has continued the tradition of Judge Pappas by ordering an accounting of more cases to determine subjectively if my legal services were worth $250.00 to the debtors. To provide the “necessary” legal services to debtors, needed to file a no asset Chapter 7 bankruptcy, an attorney must spend hours of his time, at an hourly rate of $125.00.

Hale then described each of the services rendered, but he did not provide “the name of the individual who rendered each such service.”

16194 HALE v. U.S. TRUSTEE The bankruptcy court ruled that Hale’s supplemental itemization still was incomplete: “The Supplemental Itemization contains, at pp. 9-11, fifteen separate descriptions of services rendered, which are segregated by date and time. Counsel shall identify whether he personally performed each and every such service or whether some were performed by his staff and/or interns.” The court required that Hale further supplement his itemization within 10 days.

Hale did not submit any additional itemizations. Instead, he filed a 28-page “Motion to Recuse, Vacate, and Amended [sic] Jury Trial Demand,” wherein he accused Bankruptcy Judges Jim D. Pappas and Terry Myers of harboring bias against him and of casting the legal system into disrepute. He moved for recusal of Judge Myers and requested a jury trial on the issue of his $250 fee.

The bankruptcy court scheduled a hearing to examine Hale’s compliance with its itemization orders. Hale then filed an 11-page “Motion to Recuse, Vacate Hearing, and Jury Trial Demand.” The motion included six pages of unattributed hearsay accusations, in the form of stories and narratives, leveled at Judge Myers. Hale repeated his motion for Judge Myers to recuse himself, renewed his request for a jury trial on the issue of his $250 fee, and asked that the scheduled hearing be vacated. With regard to the latter, he argued that he was unable to attend the hearing because he was working as a professor and because Judge Myers should recuse himself .

The hearing remained on the docket as scheduled. Hale did not attend, and the bankruptcy court continued the matter for further briefing. The court gave the U.S. Trustee three weeks to respond to Hale’s motions and gave Hale 10 days to respond to the U.S. Trustee’s brief once filed. The U.S. Trustee filed a brief, but Hale did not file a reply.

Thereafter, the bankruptcy court published a Memorandum of Decision. In re Jones, No. 01-02853, 2002 WL 818275

HALE v. U.S. TRUSTEE 16195 (Bankr. D. Idaho Apr. 4, 2002). In it, the court denied Hale’s motion for judicial recusal. Id. at *5. The court ruled that Hale had tendered only rumors, innuendos, and unsupported allegations in support of his motion, which are insufficient to warrant recusal under 28 U.S.C. § 455(a). Jones, 2002 WL 818275, at *4-5. The court also denied Hale’s request for a jury trial, citing In re Rheuban, 121 B.R. 368 (Bankr. C.D. Cal. 1990), and In re Rheuban, 128 B.R. 551 (Bankr. C.D. Cal. 1991). Jones, 2002 WL 818275, at *6.

The bankruptcy court then scheduled a status conference to set a briefing schedule on the reasonableness of Hale’s fee. On the morning the conference was to take place, Hale faxed the bankruptcy court a note: “Please accept my apology for not being able to attend the Status Conference scheduled for 3:00 p.m., today. I left class feeling extremely disoriented and I was forced to seek medical assistance.” The bankruptcy court vacated the hearing and rescheduled the status conference for a date nearly three months later.1 All parties attended the rescheduled conference, at which the court established a discovery time line and scheduled a hearing on Hale’s fee.

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