Jones v. Winnepesaukee

• Court: Court of Appeals for the First Circuit
• Decided: April 1, 1993
• Docket: 92-2151
• Status: Published

Opinion

USCA1 Opinion

April 1, 1993    [Opinion reissued as published.]

                            UNITED STATES COURT OF APPEALS
                                FOR THE FIRST CIRCUIT

_________________________

          No. 92-2151

                             CATHERINE M. JONES, ET AL.,

                               Plaintiffs, Appellants,

                                          v.

                            WINNEPESAUKEE REALTY, ET AL.,

                                Defendants, Appellees.

_________________________

                     APPEAL FROM THE UNITED STATES DISTRICT COURT

                          FOR THE DISTRICT OF NEW HAMPSHIRE

                     [Hon. Norman H. Stahl, U.S. District Judge]
                                            ___________________

_________________________

                                        Before

                                Selya, Circuit Judge,
                                       _____________

                            Coffin, Senior Circuit Judge,
                                    ____________________

                              and Boudin, Circuit Judge.
                                          _____________

_________________________

David A. Jones for appellants.
               ______________

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                                    March 12, 1993

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SELYA, Circuit  Judge.   In  this appeal,  a family  of
                    SELYA, Circuit  Judge.
                           ______________

          disappointed plaintiffs asks us  to overturn the district court's

          entry  of judgment on a counterclaim and to annul awards covering

          attorneys'  fees and sanctions.   Finding no cognizable error, we

          affirm.

          I.  BACKGROUND
          I.  BACKGROUND

                    In  early  1989,  Catherine   M.  Jones  and  her  son,

          Alexander  T. Jones, filed suit to recover amounts allegedly owed

          by Reid S. Littlefield  in consequence of Littlefield's agreement

          to  rent a vacation home in Gilford, New Hampshire.  Littlefield,

          through  counsel, answered the  complaint and  counterclaimed for

          breach of contract,  assault, and  trespass.1  In  response to  a

          pretrial  order, the  two  original plaintiffs  filed an  amended

          complaint  in which they  joined David A. Jones,  an owner of the

          property  and a signatory to the lease, as a co-plaintiff.2  Soon

          thereafter, plaintiffs' attorney moved to withdraw from the case.

          On  January 2,  1990,  the magistrate-judge  allowed the  motion.

          From  that point forward, David  Jones served as  his own counsel

          and at times represented his co-plaintiffs.

____________________

               1Appellants' suit  named a myriad  of other defendants.   In
          the  present  posture of  the case,  no  useful purpose  would be
          served by furnishing details relevant to these persons and firms.

               2David Jones is Catherine's  husband and Alexander's father.
          He  is also  an  attorney.    He  represents  the  appellants  in
          connection with this appeal.   We note in passing  that, although
          Alexander Jones is  listed in  the notice of  appeal, brief,  and
          other documents as  an appellant, he  is seemingly unaffected  by
          any  of the  orders  under review.    We, therefore,  ignore  his
          presence  and treat Catherine and David Jones as if they were the
          sole appellants.

                                          2

In April  1990, appellants withdrew most  of the causes

          of  action originally  asserted against  Littlefield.   Buoyed by

          this concession, Littlefield moved to dismiss on the  ground that

          there was no longer a sufficient amount in controversy.  Although

          the  court  denied  Littlefield's  motion  and  gave   appellants

          permission  to  supplement their  pleadings,  appellants made  no

          effort  to cure the perceived  deficiency.3  On  August 27, 1990,

          the court dismissed their complaint.

                    Claiming  that they  had never  received notice  of the

          opportunity  to amend  their  pleadings, and  denying (despite  a

          clear record to the contrary) that they had withdrawn their other

          causes  of action,  appellants sought  and obtained  the district

          court's agreement  to reconsider.   The  court withheld entry  of

          judgment and set a reconsideration  hearing for January 7,  1991.

          The  appellants did not attend.  Instead, they notified the court

          a  week  beforehand  that  Catherine  Jones's  medical  condition

          precluded travel from  Pennsylvania to New Hampshire.   The court

          continued the  hearing until June 24,  1991.  On  that date, only

          David Jones  appeared, claiming that a  daughter's sudden illness

          prevented  his  wife's attendance.    The  court rescheduled  the

          hearing  for April  6,  1992, but  warned  appellants that  their

          failure to attend  on the new date  would result in dismissal  of

          the complaint and, possibly, additional sanctions.
                              
          ____________________

               3We use the  term "perceived deficiency" advisedly.   As the
          district  court  recognized,  the  amount  in   controversy,  for
          purposes of  federal diversity jurisdiction, is  determined as of
          the time the case is  first commenced.  See Klepper v.  First Am.
                                                  ___ _______     _________
          Bank, 916 F.2d 337, 340 (6th Cir. 1990).
          ____

                                          3

Notwithstanding  the  court's admonition,  no plaintiff

          appeared on  April 6.   Appellants  did not  communicate directly

          with the court but  sent a facsimile transmittal to  their former

          attorney  explaining that illness  supposedly prevented them from

          attending.  Its patience exhausted,  the district court acted  on

          its  earlier dismissal of the complaint and entered judgment.  On

          May   5,  1992,   the   court  denied   appellants'  motion   for

          reconsideration  and, at  the  same  time, granted  Littlefield's

          motion for entry  of a  default in respect  to the  counterclaim.

          The court fixed  June 3, 1992 for  a dual-purpose hearing  (i) to

          determine  damages  on the  counterclaim,  see  Fed. R.  Civ.  P.
                                                     ___

          55(b)(2), (d),  and (ii) to  consider the possible  imposition of

          sanctions.  Although appellants  did not show up  for the June  3

          hearing, the court received evidence and reserved decision.

                    On  September 8,  1992, the  court awarded  Littlefield

          $2,000  on  the  counterclaim's   assault  count,  dismissed  the

          remaining counts of the counterclaim (finding Littlefield's proof

          of  damages inadequate), awarded  Littlefield attorneys'  fees in

          the  amount of  $6,338.80, and  fined Mr.  and Mrs.  Jones $5,000

          apiece for  their consistent failure to  attend pretrial hearings

          and  their bad faith in  conducting the litigation.   This appeal

          followed.     

          II.  DISCUSSION
          II.  DISCUSSION

                    Having  studied the  record, we  conclude that  none of

          appellants' contentions  merit  relief from  the  various  orders

          entered  below.  In explaining why this is so, we comment briefly

4

on four of appellants' principal points.

A.  The Matter of Status.
                              A.  The Matter of Status.
                                  ____________________

                    Throughout most  of  this litigation,  David Jones  has

          characterized himself as an  "involuntary plaintiff."  On appeal,

          he  maintains this  characterization, arguing  that, as  such, he

          cannot be forced to pay sanctions.  We do not  think that Jones's

          point is properly preserved.

                    To be  sure, Jones is  an involuntary plaintiff  in the

          sense that, on August 28, 1989, the magistrate-judge ordered  the

          two  original plaintiffs to join him.  (Given his relationship to

          the  property and  the  lease, he  was  a necessary,  perhaps  an

          indispensable,  party,  see  Fed.  R.  Civ.  P.  19.)    However,
                                  ___

          subsequent to joinder, Jones made several personal appearances in

          the case and also made a number of written submissions.  While he

          styled himself at various times as an "involuntary plaintiff," he

          never asked the district court to drop him as a party.  That ends

          the matter.  In this  circuit, "it is a party's  first obligation

          to  seek any relief that might fairly have been thought available

          in the district court before seeking it on appeal."   Beaulieu v.
                                                                ________

          United States  Internal Revenue Serv.,  865 F.2d 1351,  1352 (1st
          _____________________________________

          Cir. 1989); accord  Dartmouth Rev. v. Dartmouth College, 889 F.2d
                      ______  ______________    _________________

          13, 22 (1st Cir. 1989);  Aoude v. Mobil Oil Corp., 862  F.2d 890,
                                   _____    _______________

          896 (1st Cir. 1988).  Thus, here, neither the question of whether

          it  was error for the magistrate-judge to direct that David Jones

          be joined as  a plaintiff,  nor the related  question of  whether

5

Jones participated in the suit under unfair compulsion, is before

          us.4

                            B. The Assessment of Damages.
                            B. The Assessment of Damages.
                            _____________________________

                    We next consider Catherine Jones's contention  that the

          district court improperly assessed damages against her in the sum

          of $2,000.  The  record discloses that, after entering  a default

          on the  counterclaims, the  district court scheduled  a proof-of-

          claim  hearing for June 3, 1992, directed Littlefield to submit a

          full  accounting   of  his  damages  in   advance,  and  directed

          appellants  to respond  to  this submission  before the  hearing.

          Littlefield filed a written statement of damages and a supporting

          memorandum.   The appellants filed nothing.   They also boycotted

          the June  3  hearing.   In  contrast,  Littlefield  appeared  and

          testified.  Based upon the evidence before it, the district court

          awarded Littlefield $2,000 in  damages against Catherine Jones on

          the assault counterclaim.

                    Once the  entry of  a default establishes  the fact  of
                                                                   ____

          damage, the  trial judge,  sitting without  a jury in  a Rule  55

          proceeding, has  considerable latitude in  determining the amount
                                                                     ______

          of damages.  See Sony  Corp. v. Elm State Elecs., Inc.,  800 F.2d
                       ___ ___________    ______________________

          317,  321  (2d  Cir.   1986)  (reviewing  assessment  of  damages

          following entry  of  default  for abuse  of  discretion).    This

          standard dictates  the  result in  the  present situation.    The
                              
          ____________________

               4Moreover,  Jones seems  to have  been perfectly  willing to
          reap  the benefits of party-plaintiff status.  In one motion that
          he signed, Jones deemed  himself "entitled to all the  rights the
          statutes  and/or  case law  afford  to  any  Party, voluntary  or
          involuntary."  He cannot, of course, have it both ways.

                                          6

district judge  determined that, notwithstanding the  default, he

          should not rely merely on  unverified allegations to determine an

          appropriate award of damages in a case not involving a liquidated

          amount,  see, e.g.,  Dundee Cement Co. v. Howard  Pipe & Concrete
                   ___  ____   _________________    _______________________

          Prods., Inc., 722 F.2d 1319, 1323  (7th Cir. 1983); Byrd v. Keene
          ____________                                        ____    _____

          Corp.,  104 F.R.D.  10,  12  (E.D.  Pa.  1984),  and,  therefore,
          _____

          convened an evidentiary hearing  to establish the quantum  of the

          award.  See Al-Kazemi v. General  Acceptance & Inv. Corp., 633 F.
                  ___ _________    ________________________________

          Supp.  540, 542 (D.D.C. 1986);  Systems Indus., Inc.  v. Han, 105
                                          ____________________     ___

          F.R.D. 72, 74-75 (E.D. Pa. 1985).

                    Absent a  sum certain, the district  court, in arriving

          at the award,  could do no more than rely  on the evidence before

          it.  Through no fault of either the court or the counterclaimant,

          the  evidence  produced  at   the  hearing  consisted  mainly  of

          Littlefield's   statement  of   damages   and  sworn   testimony.

          Reviewing this evidence to  the extent possible,5 we  perceive no

          abuse  of discretion in a  $2,000 award.   Littlefield stated, by

          affidavit, that Catherine Jones's  threats of violence caused him

          to  experience fear of physical injury and mental distress.  Non-

          economic  damages  for  apprehension,  emotional   distress,  and

          psychic   injury  are   not  easily   computed   and,  therefore,

          determinations of  this type  are extremely  fact-sensitive. See,
                                                                       ___

____________________

               5Appellants have prosecuted this appeal  without procuring a
          transcript of the June 3 hearing.  They must, therefore, bear the
          onus  of any uncertainties arising out of an incomplete record on
          appeal.   See Real  v. Hogan,  828 F.2d 58,  60 (1st  Cir. 1987);
                    ___ ____     _____
          United  States v. One Motor  Yacht Named Mercury,  527 F.2d 1112,
          ______________    ______________________________
          1113-14 (1st Cir. 1975).

                                          7

e.g.,  Wagenmann  v. Adams,  829 F.2d  196,  216 (1st  Cir. 1987)
          ____   _________     _____

          (observing  that "there  is  no scientific  formula or  measuring

          device  which can be  applied to place a  precise dollar value on

          matters  such  as .  .  . fright,  anxiety,  . .  .  or emotional

          scarring").   Bearing in  mind the  incomplete record,  see supra
                                                                  ___ _____

          note  5, the nature of the  alleged damages, the modest amount of

          the  award, the  appellants'  failure to  submit any  information

          whatever  at  or  before  the proof-of-claim  hearing,6  and  the

          deferential  standard of  review, we  are powerless  to undo  the

          award.     

                            C.  The Award of Counsel Fees.
                            C.  The Award of Counsel Fees.
                                _________________________

                    It  is  beyond serious  dispute  that  a federal  court

          possesses inherent  power to  shift attorneys' fees  when parties

          conduct  litigation in bad faith.   See Roadway  Express, Inc. v.
                                              ___ ______________________

          Piper,  447  U.S. 752,  765-66  (1980)  (recognizing "bad  faith"
          _____

          exception to  general rule that federal  courts cannot ordinarily

          make fee-shifting  awards); Stefan  v. Laurenitis, 889  F.2d 363,
                                      ______     __________

          370 (1st  Cir. 1989) (discussing district  court's inherent power

          under Roadway doctrine); Peltier v. Peltier, 548 F.2d 1083,  1084
                _______            _______    _______

          (1st Cir.  1977) (affirming award  of attorneys' fees);  see also
                                                                   ___ ____

          Chambers  v. NASCO,  Inc., 111  S. Ct.  2123, 2133 (1991).   This
          ________     ____________

          power  should  be  used  sparingly  and  reserved  for  egregious

          circumstances.

____________________

               6This eschewal is an appropriate consideration  on appellate
          review of a damage award.  See, e.g., Knightsbridge Mktg. Servs.,
                                     ___  ____  ___________________________
          Inc.  v. Promociones  Y Proyectos,  728 F.2d  572, 575  (1st Cir.
          ____     ________________________
          1984).

                                          8

The district court, citing the "general non-cooperative

          and often  contentious manner" in which  appellants conducted the

          litigation,  as well  as offering  numerous examples  of untoward

          practice,7  determined  that  the  appellants  had surpassed  the

          threshold  of   egregiousness.    The  court   made  a  specific,

          meticulously  detailed finding  of  bad faith  and exercised  its

          discretion  to  shift the  burden  of Littlefield's  fees  to the

          appellants.  We  have scrutinized  the record on  appeal and  are

          satisfied  that, although  the  court's conclusion  of bad  faith

          might not be  inevitable, it is plainly sustainable.  When, as in

          this instance, there are  two plausible views of the  record, the

          trial  court's adoption of one such  view cannot constitute clear

          error.  See United States v. St. Cyr, 977 F.2d 698, 706 (1st Cir.
                  ___ _____________    _______

          1992).  

                    Once the court made a supportable finding of bad faith,

          it then properly exercised  its discretion and shifted  the fees.

          It  considered the essential factor  (bad faith), did  not add to

          the  mix any improper factors, and made a plausible judgment call

          in  weighing  the use  of  its  inherent  powers.   No  more  was

          exigible.  See Independent Oil & Chem. Workers, Inc. v. Procter &
                     ___ _____________________________________    _________

          Gamble Mfg. Co., 864 F.2d 927, 929 (1st Cir.  1988).  In this age
          _______________

          of burgeoning litigation expense and overcrowded dockets, neither

          a sued defendant  nor a busy trial judge  should have to tolerate

          litigants'  repeated  efforts  to  stall  a  case,  harass  other
                              
          ____________________

               7We have  examined the  pleadings described in  the district
          court's memorandum order.   Many of them are  patently frivolous.
          Others seem to be riddled with demonstrably false allegations.

                                          9

participants, and frustrate the  operation of the justice system.

          See, e.g., Brockton Sav.  Bank v. Peat, Marwick, Mitchell  & Co.,
          ___  ____  ___________________    ______________________________

          771 F.2d  5,  12 (1st  Cir. 1985),  cert. denied,  475 U.S.  1018
                                              _____ ______

          (1986);  Peltier,  548 F.2d  at  1084.   The  court appropriately
                   _______

          invoked its inherent power.8

                           D.  The Imposition of Sanctions.
                           D.  The Imposition of Sanctions.
                               ___________________________

                    We discern no abuse of discretion  in the lower court's

          imposition  of monetary  sanctions on  Catherine Jones  and David

          Jones, separately, pursuant  to its authority under  Fed. R. Civ.

          P. 16(f).9

                    Trial judges enjoy great latitude in carrying out case-

          management functions.   In re  San Juan Dupont  Plaza Hotel  Fire
                                  _________________________________________

          Litig., 859 F.2d  1007, 1019  (1st Cir. 1988).   When  confronted
          ______

          with a party's defiance of  its management authority, a  district

          court  is  necessarily  vested with  considerable  discretion  in

          deciding whether to impose  sanctions on that party, and,  if so,
                              
          ____________________

               8In its  fee-shifting order,  the district court  relied, in
          the alternative, on its power  under state law.  Because  we find
          that  the court  had inherent  power to  award counsel  fees, see
                                                                        ___
          supra,  we  need  not reach  the  question  of  whether, in  this
          _____
          diversity case, New Hampshire  law also allowed for fee-shifting.
                                             ____
          See Chambers, 111 S. Ct. at 2136-38 (explaining that fee-shifting
          ___ ________
          under  a  federal court's  inherent  power to  redress  bad faith
          conduct  is a  matter  of vindicating  judicial authority,  not a
          matter of substantive remedy, and is, therefore, permissible in a
          diversity case whether or not authorized by state law).

               9The rule  authorizes a  district court to  impose sanctions
          "as are just" against a party for, inter alia, failure  to obey a
                                             _____ ____
          scheduling  or  pretrial order,  or for  failure  to appear  at a
          scheduling  or  pretrial conference.    Fed.  R. Civ.  P.  16(f).
          Because  we conclude  that  the district  court properly  imposed
          monetary sanctions under Rule  16(f), we take no view  of whether
          the  sanctions were likewise  permissible in the  exercise of the
          court's inherent power.

                                          10

in  determining what form the  sanctions should take.   See Media
                                                                  ___ _____

          Duplication Servs.,  Ltd. v. HDG  Software, Inc., 928  F.2d 1228,
          _________________________    ___________________

          1238  (1st Cir.  1991).   Because sanctions  are well  within the

          heartland of  the district  court's realm,  we review a  district

          court's imposition of them only for manifest abuse of discretion.

          See Velazquez-Rivera v. Sea-Land Serv., Inc., 920 F.2d 1072, 1075
          ___ ________________    ____________________

          (1st Cir.  1990); Brockton Sav. Bank,  771 F.2d at  12.  Although
                            __________________

          such a deferential  approach does not confer carte  blanche power
                                                       _____  _______

          to the  district court,  see, e.g.,  Navarro-Ayala v.  Nunez, 968
                                   ___  ____   _____________     _____

          F.2d  1421, 1427  (1st Cir.  1992); Figueroa-Rodriguez  v. Lopez-
                                              __________________     ______

          Rivera,  878   F.2d  1478,   1491  (1st  Cir.   1988),  litigants
          ______

          "protesting an order in respect to sanctions bear[]  a formidable

          burden  in attempting to convince  the court of  appeals that the

          lower court  erred."  United States v. One 1987 BMW 325, ___ F.2d
                                _____________    ________________

          ___, ___  (1st Cir. 1993)  [No. 92-1827, slip  op. at 5];  accord
                                                                     ______

          Spiller v. U.S.V. Lab., Inc., 842 F.2d 535, 537 (1st Cir. 1988).
          _______    _________________

                    The record supports an assessment  that, throughout the

          course of  this  litigation, appellants  regularly  defied  court

          orders  directing them  to attend  pretrial hearings,  e.g., both
                                                                 ____

          Catherine and David Jones failed  to appear at hearings scheduled

          for  January  7, 1991,  April  6,  1992, and  June  3, 1992,  and

          Catherine  Jones also failed to appear at a hearing scheduled for

          June  24, 1991.   Although appellants  offered excuses  for these

          episodes, they  offered no  irresistibly convincing reasons.   To

          give one illustration, appellants tried to explain their absences

          on  April 6  and  June 3,  1992,  by claiming  that,  despite all

11

indications  to  the contrary,  they  did not  receive  notice of

          scheduled hearings.  The  district court disbelieved this excuse.

          It was  entitled to do so.   See, e.g., Spiller, 842  F.2d at 537
                                       ___  ____  _______

          (noting  plaintiff's "history  of  foot-dragging"  and  rejecting

          similar excuse  in affirming dismissal of  plaintiff's action for

          failure  to  comply  with   court  orders).    To  give   another

          illustration, appellants continually  claimed illness (theirs  or

          some  other  family  member's)   but  the  medical  records  they

          eventually  proffered were  neither timely  filed nor  served, as

          required, on opposing counsel; moreover, the records were by  and

          large  too  vague to  satisfy  appellants'  burden.   Given  this

          checkered pattern,  and given,  further, that the  district court

          warned  appellants on  more than  one occasion  about  the likely

          consequences of failure to  attend, we find that the  court acted

          within its discretion in levying sanctions under Rule 16(f).  See
                                                                        ___

          Goldman,  Antonetti, Ferraiuoli,  Axtmayer  &  Hertell v.  Medfit
          ______________________________________________________     ______

          Int'l, Inc., ___ F.2d ___, ___ (1st Cir. 1993) [No. 92-1458, slip
          ___________

          op. at 12-14] (holding that a counterclaimant's unexcused failure

          to attend two pretrial conferences after the court had threatened

          sanctions  for  failure  to  attend warranted  dismissal  of  the

          counterclaim under  Rule 16(f)); see  also Thibeault v.  Square D
                                           ___  ____ _________     ________

          Co., 960 F.2d 239,  246 (1st Cir. 1992) (noting that  totality of
          ___

          circumstances for sanction purposes could include events in other

          litigation).

                    We  likewise  conclude  that  the  sanctions   are  not

          excessive.   On  this point,  the  district court,  after  citing

12

appellants'  defiance  of two  orders  directing  them to  attend

          pretrial  hearings  and  noting their  chronicled  propensity  to

          engage in  similar behavior  in earlier proceedings,  stated that

          the  sanctions it chose were  fashioned to "deter plaintiffs, and

          other litigants, from engaging in the course of conduct displayed

          throughout  this   litigation."10     Deterrence   is  a   widely

          recognized  basis  for  determining  the  amount  of  a  monetary

          sanction.  See Media Duplication, 928 F.2d at 1242 (approving use
                     ___ _________________

          of monetary sanctions under Rule 16(f) as a means of deterring an

          attorney's neglect of  scheduled proceedings); see also  Navarro-
                                                         ___ ____  ________

          Ayala,  968 F.2d at 1426-27 (discussing deterrence as a basis for
          _____

          gauging  monetary sanctions under Rule 11).   Having reviewed the

          district court's explanation of why it chose the precise sanction

          amounts and  finding  that the  amounts are  "within the  minimum

          range reasonably  required to deter the abusive behavior," id. at
                                                                     ___

          1427, we are constrained to conclude that the court below did not

          overspill the banks of its discretion under Rule 16(f).

          III.  CONCLUSION
          III.  CONCLUSION

                    We  need go no further.11   In this  case, the district

          judge exhibited  commendable patience.   In the end,  however, he

          found that appellants consistently  defied explicit court  orders

          directing   them  to   attend   pretrial   hearings      hearings

____________________

               10In line with the court's goal of deterrence, the sanctions
          are to be paid into the registry of the district court.

               11Appellants waived many other  assignments of error at oral
          argument.   The rest are utterly lacking in merit and need not be
          discussed.

                                          13

necessitated, in the main, by their own absences and requests for

          reconsideration of earlier rulings.  The judge also found (again,

          supportably)  that appellants pelted the court  with a torrent of

          idle   motions  and   submissions,  many   containing  scurrilous

          allegations, serving no apparent purpose other than to harass the

          court,  burden the defendant, and delay a resolution of the case.

          Given  what  the  nisi  prius  roll reveals,  together  with  the
                            ____  _____

          district court's record-rooted finding that  appellants blatantly

          disregarded the  federal courts'  authority to  manage litigation

          through  reasonable  means,  there  is no  principled  basis  for

          vacating the rulings complained of in this appeal.

Affirmed.
                    ________

14