Shales v. General Chauffeurs, Sales Drivers & Helpers Local Union No. 330

557 F.3d 746, 2009 U.S. App. LEXIS 4237, 2009 WL 483193
CourtCourt of Appeals for the Seventh Circuit
DecidedFebruary 27, 2009
Docket07-3342
StatusPublished
Cited by20 cases

This text of 557 F.3d 746 (Shales v. General Chauffeurs, Sales Drivers & Helpers Local Union No. 330) is published on Counsel Stack Legal Research, covering Court of Appeals for the Seventh Circuit primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Shales v. General Chauffeurs, Sales Drivers & Helpers Local Union No. 330, 557 F.3d 746, 2009 U.S. App. LEXIS 4237, 2009 WL 483193 (7th Cir. 2009).

Opinion

EASTERBROOK, Chief Judge.

After a contested union election, the losers sued the winners under a variety of theories, including racketeering. All aspects of the suit eventually were resolved in defendants’ favor, because the plaintiffs could not prove what the complaint alleged. During discovery it became evident that many of the allegations were fanciful. One plaintiff, for example, contended that the successful candidate for president of the local union had intentionally inflicted emotional distress by threatening to fire her if he won. The evidence showed that, whatever she may have heard through the grapevine, he had not made such a threat; after the election he kept her on with a raise. As a matter of state law, a claim of intentional infliction of emotional distress also requires proof of some severe reaction, and this plaintiff offered none other than an asthma attack more than a year after the election — and she had suffered from occasional asthma attacks for 25 years. Other claims were as weak, or worse.

As discovery continued and it became ever more evident that the complaint lacked a basis in fact, counsel for the defendants began to send letters demanding that particular claims be deleted from the complaint and withdrawn from the litigation. James Gordon Banks, who represented the plaintiffs, did not reply to any of these requests. When the case was over, defendants sought sanctions under 28 U.S.C. § 1927 on the theory that Banks had vexatiously multiplied the proceedings, and under Fed.R.Civ.P. 11 on the theory that Banks had failed to make a reason *748 able investigation before filing suit and had advocated the complaint long after it became clear that the allegations were unfounded. The district judge granted defendants’ motion for sanctions, see 2007 WL 951927, 2007 U.S. Dist. LEXIS 22243 (N.D.Ill. Mar. 26, 2007), and asked defendants to delineate the attorneys’ fees incurred to defeat the suit. Defendants collectively asked for some $200,000, but the judge thought this excessive and concluded that reasonable fees had been approximately $80,000, which he ordered Banks to pay. 2007 WL 2274664, 2007 U.S. Dist. LEXIS 57044 (N.D.Ill. Aug. 6, 2007).

Banks asked the judge to reduce this award, representing that his only assets are $2,000 in cash, his watch, his clothing, and his wedding band. He does not carry malpractice insurance, because he has no significant assets to insure. Defendants replied that Banks has a legal education and thus a potential to earn enough to pay^ — and, the defendants observed, the reason Banks does not own much is that the family home, cars, and savings all are in his wife’s name. With the odor of a fraudulent conveyance in the air, the district judge denied Banks’s motion to reduce the award.

Defendants contend that Banks’s appeal is untimely. The decision sought to be reviewed was entered on August 6, 2007, and the notice of appeal was not filed until September 27, more than 30 days later. But on August 20 Banks had filed a motion to reconsider, which the district court denied on August 28. The appeal was filed 30 days later and is timely, if the motion suspends the decision’s finality under Fed. R.App. P. 4(a)(4). The motion was filed within 10 business days (weekends are excluded from the count, see Fed. R.App. P. 26(a)(2)), so it was timely if it is on the list in Rule 4(a)(4)(A). And that list includes both a motion to amend the judgment under Fed.R.Civ.P. 59 and a motion for relief under Fed.R.Civ.P. 60, if filed within ten business days.

What defendants say is that Banks’s motion does not count, despite its caption (it invoked both Rule 59 and Rule 60), because it did not present a good argument. But Rule 4(a)(4) refers to types of motions (effectively, to kinds of relief sought), not to whether the motion is well taken. See Urso v. United States, 72 F.3d 59 (7th Cir.1995). If a party had to present a good argument for relief, the rule might as well be rewritten to say that the time for appeal runs from the district court’s original decision, unless that decision is actually amended in response to a later motion. The actual rule, however, provides that the existence of a motion, and not the motion’s merit, is what suspends the time for appeal. No other approach is feasible. Jurisdictional time limits must be ascertained mechanically. Budinich v. Becton Dickinson & Co., 486 U.S. 196, 108 S.Ct. 1717, 100 L.Ed.2d 178 (1988). Litigants, and a court of appeals, can ascertain in a mechanical fashion whether, and when, a particular motion has been filed. Making appellate jurisdiction turn on the motion’s substance would introduce a quagmire into appellate practice. Banks made a kind of motion that resets the clock for an appeal, and he filed the notice of appeal within 30 days of the motion’s denial. The appeal is proper.

Banks’s principal argument is that Rule 11 is not a pure fee-shifting statute, so ability to pay should be taken into account. This is true as far as it goes. “A sanction imposed under this rule must be limited to what suffices to deter repetition of the conduct or comparable conduct by others similarly situated.” Fed. R.Civ.P. 11(c)(4). The poorer the lawyer, the lower the sanction can be and still deter repetition by the lawyer or anyone *749 similarly situated. Cf. Leister v. Dovetail, Inc., 546 F.3d 875, 883-84 (7th Cir.2008); Zazu Designs v. L’Oreal, S.A., 979 F.2d 499, 507-08 (7th Cir.1992). A district judge therefore should take the sanctioned party’s resources into account when setting the amount of a Rule 11 sanction. See Johnson v. A.W. Chesterton Co., 18 F.3d 1362, 1366 (7th Cir.1994). But the district judge imposed sanctions under § 1927, a real fee-shifting law, as well as Rule 11. An award under § 1927 depends (as an award under Rule 11 does not) on a finding of bad faith. It is awfully hard to see why a lawyer who acted in bad faith should be let off lightly. Banks’s brief essentially ignores § 1927, but that does not make it go away.

A violation of § 1927 is a form of intentional tort. And there is no principle in tort law that damages depend on a tortfea-sor’s assets. Quite the contrary. Damages depend on the victim’s loss, not the wrongdoer’s resources.

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Bluebook (online)
557 F.3d 746, 2009 U.S. App. LEXIS 4237, 2009 WL 483193, Counsel Stack Legal Research, https://law.counselstack.com/opinion/shales-v-general-chauffeurs-sales-drivers-helpers-local-union-no-330-ca7-2009.