Hart v. Perkins

1 2 3 4 5 UNITED STATES DISTRICT COURT 6 FOR THE WESTERN DISTRICT OF WASHINGTON AT SEATTLE 7 8 CODY HART, et al., CASE NO. 2:23-cv-00404-RSL 9 Plaintiffs, v. 10 11 SKAGIT COUNTY AUDITOR SANDRA ORDER DENYING MOTION FOR ATTORNEY’S FEES PERKINS, et al., 12 Defendants. 13 14 15 In two orders issued on May 16, 2023, and September 14, 2023, the Court 16 dismissed plaintiffs’ claims, finding that plaintiffs lacked standing to seek relief, that the 17 federal statutes they cited do not give rise to a private cause of action, that their state law 18 claims were time-barred, and that plaintiffs could not recover on the Skagit County 19 defendants’ bonds where there was no viable claim against the County defendants. Dkt. 20 # 44 and # 53. Defendant RLI Insurance Company now seeks an award of attorney’s fees 21 pursuant to RCW 4.84.185, the Court’s equitable powers, and 28 U.S.C. § 1927. Dkt. # 61. 22 A. RCW 4.84.185 23 RCW 4.84.185 provides for an award of reasonable expenses, including attorney’s 24 fees, if a claim or defense is “frivolous and advanced without reasonable cause.” Under 25 Erie R. Co. v. Tompkins, 304 U.S. 64 (1938), attorney’s fees may be awarded under state 26 law only if they are part of the state’s substantive, rather than procedural, requirements. ORDER DENYING MOTION FOR ATTORNEY’S FEES - 1 1 “[W]hen fees are based upon misconduct by an attorney or party in the litigation itself, 2 rather than upon a matter of substantive law, the matter is procedural” and the Court must 3 look to federal law to determine the appropriate sanction. In re Larry’s Apartment, L.L.C., 4 249 F.3d 832, 838 (9th Cir. 2001). When an attorney appears in federal court, she is acting 5 as an officer of that court, and sanctions, if imposed at all, must comport with the policies 6 and procedures delineated under federal law. Id. It would be “quite anomalous to suggest 7 that a federal court must look to the . . . state legislature to vindicate an abuse of the federal 8 judicial power.” People by Abrams v. Terry, 45 F.3d 17, 23 (2nd Cir. 1995). 9 Because RCW 4.84.185 is inapplicable, RLI’s request for fees under that statute 10 must be denied. 11 B. 28 U.S.C. § 19271 12 Pursuant to 28 U.S.C. § 1927, “[a]ny attorney or other person admitted to conduct 13 cases in any court of the United States or any Territory thereof2 who so multiplies the 14 proceedings in any case unreasonably and vexatiously may be required by the court to 15 satisfy personally the excess costs, expenses, and attorneys’ fees reasonably incurred 16 because of such conduct.” Fees are appropriate under § 1927 if party “knowingly or 17 recklessly raises a frivolous argument, or argues a [ ] claim for the purpose of harassing an 18 opponent, which qualifies as bad faith.” Caruso v. Wash. State Bar Ass’n, 2017 WL 19 2256782, at *3 (W.D. Wash. May 23, 2017) (quoting W. Coast Theater Corp. v. City of 20 Portland, 897 F.2d 1519, 1528 (9th Cir. 1990)). Actions taken “with the intent to increase 21 expenses ... or delay” may also constitute bad faith worthy of sanctions. Nielsen v. Unum 22 Life Ins. Co. of Am., 166 F. Supp. 3d 1193, 1195 (W.D. Wash. 2016) (citing NewAlaska 23 24 1 Where there is a statute or rule that addresses the conduct at issue, the Court should ordinarily rely on that authority before turning to its inherent powers. See Chambers v. NASCO, Inc., 501 U.S. 32, 50 (1991). The Court will, therefore, first determine whether § 1927 is “up to the task” in the circumstances presented here before turning to its 25 inherent powers. Id. 26 2 “Section 1927 sanctions may be imposed upon a pro se plaintiff.” Wages v. I.R.S., 915 F.2d 1230, 1235–36 (9th Cir. 1990). ORDER DENYING MOTION FOR ATTORNEY’S FEES - 2 1 Dev. Corp. v. Guetschow, 869 F.2d 1298, 1306 (9th Cir. 1989)). However, the statute 2 “applies only to unnecessary filings and tactics once a lawsuit has begun” and cannot be 3 used to attack the initial complaint. In re Keegan Mgmt. Co. Sec. Litig., 78 F.3d 431, 435 4 (9th Cir. 1996). 5 RLI cannot recover fees incurred because plaintiffs filed this lawsuit or asserted 6 meritless claims. Rather, RLI must identify post-filing conduct that (1) was unreasonable 7 and vexatious and (2) caused it to incur unnecessary expense. The two motions for default, 8 the motion to strike, and the motion for disciplinary action were all aimed at parties other 9 than RLI, and there is no indication that RLI incurred any “excess” fees as a result of those 10 filings. The motion for leave to pursue recovery out of the Skagit County defendants’ 11 official bonds did require RLI to respond, but it was filed before the Court had determined 12 that the Skagit County defendants were not liable. The motion was not, at the time it was 13 filed, unreasonable or vexatious and cannot, therefore, be the basis of a fee award under 14 Section 1927. 15 C. Inherent Powers 16 “Federal courts possess certain ‘inherent powers,’ not conferred by rule or statute, 17 ‘to manage their own affairs so as to achieve the orderly and expeditious disposition of 18 cases.’” Goodyear Tire & Rubber Co. v. Haeger, 581 U.S. 101, 107 (2017) (quoting Link 19 v. Wabash R. Co., 370 U.S. 626, 630-31 (1962)). The Court’s inherent powers include “the 20 ability to fashion an appropriate sanction for conduct which abuses the judicial process.” 21 Chambers, 501 U.S. at 44-45. RLI argues that plaintiffs have pursued “the same frivolous 22 claims . . . over and over again in state and federal court, that there is a “clear record of 23 Plaintiffs’ vexatious litigation conduct,” and that sanctions are therefore warranted in this 24 case. Dkt. # 61 at 8. 25 Contrary to RLI’s assertion, this case involved unique and distinct assertions of 26 wrongdoing against the Skagit County defendants. None of the other lawsuits were based ORDER DENYING MOTION FOR ATTORNEY’S FEES - 3 1 on the allegation that the Skagit County defendants had violated state and federal law by 2 neglecting to properly perform duties related to the 2016-2019 election cycles. Seeking 3 judicial resolution of that claim was not an abuse of the judicial process. 4 5 For all of the foregoing reasons, RLI’s motion for attorney’s fees (Dkt. # 61) is 6 DENIED. Plaintiffs’ motion for more information regarding the request for attorney’s fees 7 (Dkt. # 59) is DENIED as moot. 8 9 Dated this 3rd day of November, 2023. 10 11 Robert S. Lasnik 12 United States District Judge 13 14 15 16 17 18 19 20 21 22 23 24 25 26 ORDER DENYING MOTION FOR ATTORNEY’S FEES - 4